The Wilkes Partnership, Employment Law Birmingham Solihull Lisa Moore

As a result of Brexit, legislative updates and various high-profile Judgments, a number of interesting developments are expected in the field of employment law during the months ahead.

Lisa Moore, Associate in the Employment team at The Wilkes Partnership, considers some of the key changes for employers to be mindful of in 2017.

Gender Pay Gap Reporting Requirements

All private and voluntary sector employers with more than 250 employees as of 5 April 2017 should be preparing to comply with the Government’s new gender pay gap reporting requirements. Employers will need to collect data on the pay differences between male and female employees. This information will then need to be published by employers by 4 April 2018 in a prominent place on their website and on a Government website to be unveiled later this year. It is anticipated that non statutory guidance will be published on these requirements in due course by both the Government and Acas.

 Self-Employed Workers and the “Gig Economy”

The use of apparently self-employed contractors by companies like Uber and Deliveroo as part of the so called “gig economy” has been on the rise in recent years. Much publicity was generated last year when an employment tribunal found Uber drivers to be workers in the case of, Aslam and others v Uber BV and others. Uber has, however, lodged a notice of appeal in response to this decision which has been accepted and is likely to be heard in the summer so there will be further updates to follow in this case.

In February 2017, the Court of Appeal handed down a decision in the case of, Pimlico Plumbers Ltd v Smith which gave further consideration as to the distinction between self-employed contractors and employees. It was held that whilst Mr Smith was not an employee, he was a worker despite appearing from documentation to be in business on his own account, and other relevant factors such as having supplied his own materials, tools and insurance. This finding would entitle Mr Smith to pursue a number of claims against the company, including claims for holiday pay and unlawful deduction of wages. Although it is not yet clear whether they have been granted permission to do so, Pimlico Plumbers had previously indicated that it intended appealing to the Supreme Court.

Separately, the results of three inquiries are expected to be published during 2017 on this topic. Firstly, the Business, Energy and Industrial Strategy Committee will seek to address the status and rights of agency workers, the self-employed as well as individuals working in the gig economy. Secondly, the Work and Pensions Committee will consider whether the UK welfare system supports those working in the gig economy sufficiently. Finally, the Royal Society of Arts is conducting an independent review of employment practices in the modern economy.

Brexit

The Government has now triggered Article 50 and the process of the United Kingdom leaving the EU has now begun.

As much of the UK’s employment law is influenced by the EU, Brexit will have significant long term implications for the employment law landscape. For instance, changes could be made to holiday entitlement, the Agency Workers Regulations as well as the TUPE regulations. Further clarity is likely to be provided in this respect during the course of the year.

Employment Tribunal Fees

By some estimates, the 2013 increase in employment tribunal fees led to a 70% reduction in the number of employment tribunal claims. Following the increase in tribunal fees, Unison launched a bid to overturn the fee hike arguing that it restricted the access to justice of potential claimants. Unison’s challenge has made its way to the Supreme Court and is due to be heard in the next couple of weeks. In any event, the general consensus amongst employment law practitioners is that tribunal fees are here to stay.

Holiday Pay

It is anticipated that a hearing of the case of, The Sash Window Workshop Ltd and another v King will take place at the European Courts of Justice (“ECJ”) later this year. In this case, the ECJ will consider whether workers should be entitled to carry their holiday over from one year to the next in circumstances where they are unable to use their all of their allowance due to factors outside of their control.

A decision from the Employment Appeal Tribunal is also awaited in the case of, Fulton and another v Bear Scotland to establish whether statutory holiday pay should be included in overtime pay.

Conclusion

Lisa Moore comments: “The above serves as a brief summary of some of the main developments which are expected in 2017. It looks set to be a busy year with a number of other changes being introduced including an apprenticeship levy as of 6 April 2017 – this will require employers that have an annual payroll of more than £3 million to pay a 0.5% levy on their total pay bill. Furthermore, notable decision are also being awaited in cases relating to issues such as whistleblowing, disability discrimination and subject access requests so please do look out for further updates.”

To discuss anything arising from this update, please contact Lisa Moore or any member of the Employment Team on 0121 233 4333. 

 

Sarah Begley - The Wilkes Partnership, Employment Solicitor, Birmingham, Solihull

There are two types of diabetes: type 1 which is controlled by insulin and is usually defined as a disability under the Equality Act 2010 and type 2, which can be controlled by diet and/or medication. So does this mean type 2 diabetes can be defined as a disability too?

Yes, was the decision of the Employment Appeal Tribunal in the case of, Taylor v Ladbrokes Betting & Gaming Ltd.

Sarah Begley of The Wilkes Partnership considers the key points of the decision and what employers need to do in order to ensure they are following correct procedures when identifying an employee with a disability. 

After being dismissed from Ladbrokes Betting & Gaming Ltd, Mr Taylor declared he had been disabled for a year before dismissal, due to type 2 diabetes. The Employment tribunal decided the he was not disabled after reviewing two medical reports. Mr Taylor appealed.

The Judge hearing the case on appeal disagreed with the Tribunal’s findings. Type 2 diabetes, as a progressive condition, would amount to a disability even if it did not have a substantial effect at that time, as long as it was likely to result into such a condition where it would affect their ability to carry out normal day to day activities. The EAT remitted the case back to Tribunal to reconsider the issue as the Judge felt that the medical evidence was not clear and had been misinterpreted.

Sarah Begley comments: “This is an interesting and important decision. This case illustrates that employers should be careful not to automatically assume that diabetes and/or other common progressive conditions are not a disability. Each case will be determined its own facts and on this basis it is vital to consider and investigate the substantial effect on the employee’s normal daily activities present and future under The Equality Act 2010 before reaching a decision on whether or not the employee has a disability”.

To discuss anything arising from this update, please contact Sarah Begley on 0121 733 4312 or via email at sbegley@wilkes.co.uk. You can also contact  any other member of the Employment Team on 0121 233 4333.

The Wilkes Partnership, Employment Law Birmingham Solihull

The issue of discriminatory dress codes recently came to public attention when a petition calling for it to be made illegal for employers to require women to wear high heels at work received over 150,000 signatures.

The petitioner was a Ms Nicola Thorp, a temporary receptionist working at PwC, who was sent home without pay when she refused to wear high heels at work.

The House of Commons Petitions and Women & Equalities Committee (“Committee”) conducted a detailed investigation into the topic of dress codes and discrimination, and produced a report in late January 2017. The Committee found that employers, particularly in certain sectors of the economy, implemented discriminatory dress codes that sexualised and exploited young women. It has called for the Government to strengthen the law in this area.

Pam Sidhu, Head of Employment at Wilkes, comments: “Most employers specify some form of dress code for their employees. This will usually be based around legitimate concerns such as health & safety and the projection of a professional image. So long as such dress codes are sensibly drafted and allow for flexibility in certain cases, they should be legally compliant. However, there are circumstances where a dress code can be found to be discriminatory on grounds such as gender, religion or disability. As borne out by the recent report, the Equality Act already gives some protection to employees, but the practical application of the law is sometimes unclear for employees and employers. Also, some employers seem unaware of the implications of the Equality Act.”

As the law currently stands an employer will be guilty of direct discrimination if it has a dress code that is “less favourable” to one gender. For example a tribunal has found a requirement for women to wear low cut tops at work to be discriminatory.

An employer can also be found to be indirectly discriminatory where there is a dress code that applies to everyone in the same way but has a worse effect on some employees than others. Examples include dress codes that restrict the ability of employees to wear items associated with their religious beliefs. In order to protect themselves in these situations, employers will need to be confident they can demonstrate that their dress codes constitute a proportionate way of achieving a legitimate objective (for example, safety in the work place).

The Committee’s investigation found that whilst the rules relating to discriminatory dress codes are clear in principle there is often some difficulty in their practical application. It was noted that there is often uncertainty as to what constitutes less favourable treatment. The example of a requirement for women to wear make-up was identified as being problematic, as conventionally many women wear make-up and therefore less favourable treatment may not be easy to prove.

Significantly, the report commented that the 2013 increase in tribunal fees has caused a substantial reduction in the number of “test cases” making their way through the tribunal system. Consequently, there has only been limited opportunity for the building up of a body of cases that flesh out the law on discrimination in the workplace.

The Committee recommended an increase in the financial penalties applicable to employers who are found to have breached anti-discrimination law, so that employers pay more attention to the law when drafting dress codes. This would also encourage employees who have been discriminated against to bring claims.

It was also suggested that employment tribunals be given the power to award injunctions. The rationale being that it would make it quicker and easier for a claimant to resolve an issue. It is not clear how such injunctions would work in practice

Pam Sidhu further comments: “The report highlights some of the uncertainty in anti-discrimination law surrounding employment dress codes and the need to educate employers. Employers need to be vigilant to ensure they do not inadvertently fall foul of the law. The report also shows that there is now some appetite for changes to the system surrounding employment tribunals in order to encourage more claims.”

To discuss anything arising from this update, please contact Pam Sidhu or any member of the Employment Team on 0121 233 4333. 

Lisa Moore, Employment Law, Solicitor, Birmingham, Solihull

On 24 July 2015, the Government launched a consultation as to how termination payments are treated and, during August 2016, released draft legislation outlining its proposed changes.

The Autumn Statement, delivered by the Chancellor of the Exchequer on 23 November 2013, served as a reminder of some of the Government’s recommendations.

Currently, where there is a provision in an employee’s contract of employment which allows the employer to terminate his/her employment immediately by making a payment in lieu of notice (PILON),  any such payment will be taxable and subject to national insurance contributions (NICs).

Otherwise, where there is no express provision in the employee’s contract, the position can be more ambiguous.  If an employee’s contract of employment is silent on this issue and there is no discretionary or other right to a PILON, it can be possible in some circumstances for this payment to be treated as damages and paid without any deductions. However, the position in this respect depends on the specific facts of each matter. Accordingly, whether employers can pay notice payments tax free often becomes a point of contention when severance terms are being negotiated.

Notwithstanding the above, at present, employers may be able to pay non-contractual payments in connection with the termination of employment up to a value of £30,000 free from deductions and above this sum, only income tax is payable.

There are also numerous tax exemptions for particular types of payments, including in relation to injury, disability or death, for foreign service relief in relation to employment performed outside the UK, and for the armed forces.

From April 2018, in an attempt to eliminate the confusion which often arises with termination payments, it is intended that the distinction between contractual and non-contractual PILONs will be removed. Accordingly, moving forwards, all PILONs (regardless of the employee’s termination date) will be treated as earnings subject to income tax, employer and employee NICs.

It has also been suggested that payments which an employee would ordinarily receive during their notice period and would normally be taxable (such as bonus payments), will now also be subject to tax under the terms of a settlement agreement.

Furthermore, employers’ NICs will be payable on compensation payments that are above the £30,000 tax free exemption (whereas, currently, termination payments of any value are exempt from NICs).

Finally, it has been proposed that payments for injury to feelings will fall outside the exemption for injury payments (except where this amounts to a psychiatric injury or a recognised medical condition) and foreign service relief, in relation to employment outside of the UK, will be abolished (except in relation to seafarers).

Lisa Moore comments: “The Government initially proposed removing the £30,000 tax-free allowance altogether so, comparatively, the above reforms are likely to be received as welcome news by employees and employers alike. Although the proposals will provide more clarity for employers when formulating settlement terms, this is likely to come at a cost. Employers may well find themselves having to increase termination payments to compensate for making the PILON on a net basis and will have less flexibility when proposing settlement packages.”

If you would like to discuss any issue or query arising from this update please contact Lisa Moore or your usual contact in the Employment team on 0121 233 4333. Alternatively, email us at employmentlaw@wilkes.co.uk.

Christmas Party - Employment Law, Solicitor, Wilkes, Birmingham

The traditional Christmas party is an event that is eagerly anticipated in the majority of workplaces. It can take many forms, in or outside the office premises, during or after work time, informal or formal.

The one thing that is clear, says Pam Sidhu, Head of Employment at the Wilkes Partnership, is that incidents occurring during this time can potentially land the employee and/ or employer in trouble. It is important to remember that employment laws apply even where a party takes place off work premises and outside working hours. Employers could be liable for acts of discrimination, harassment, assault or other unwanted conduct by employees.

Whilst most parties pass with no more than a dodgy dance move or two, careful planning and appropriate communication by employers with their employees should allow for a safe and happy end to the year.

Avoiding Discrimination

The first issue for an employer to consider comes in the planning stage of the party.

Arrangements for the party should be non-discriminatory. If the party is away from office premises, the employer should ensure it has suitable access for disabled staff.

Additionally, staff of all religions should be considered. Some religions do not celebrate Christmas and employees of those religions may not wish to attend the party and should not be pressured to do so or disadvantaged by not participating.

Further, certain religions forbid the drinking of alcohol or the eating of particular foods. Employers therefore need to ensure soft drinks are equally available and the menu options suitably varied where possible, so as to make the event as inclusive as possible. It would be prudent to check any dietary issues with staff before the event.

If there is an over demand for annual leave requests for the day following the party, employers should avoid automatically giving priority to those attending the party.

Acceptable Standards of Behaviour

Drink fuelled behaviour is the root cause of many employment tribunal claims every year. Pam advises that employers should remind employees prior to the party that they are representing the organisation and set the boundaries in terms of what is acceptable and unacceptable in terms of standard of behaviour.

Employers should make clear to employees that any misconduct at the party will be deemed to be misconduct at work, highlighting the fact that disciplinary sanctions may follow if any employees are guilty of inappropriate behaviour.

Harassment

Remember that employers may be liable for incidents of harassment that take place at work-related social events and could face tribunal claims.

Whilst the Christmas party has often been viewed as the opportunity to pursue that office crush, if the feelings are not reciprocated then the recipient of that advance may, with some justification, feel that they have been subjected to harassment.

Fundamentally an employer will be vicariously liable for the actions of an employee in this respect, advises Pam. There are, however, simple steps an employer can take to mitigate this risk.

There is no harm, and indeed every benefit, in employers reminding employees of the need to behave and treat each other with respect. An up to date harassment policy, which is brought to the attention of all staff will also help to reduce the risk of harassment occurring and go some way to protect the employer.

Additionally, employers should investigate any complaints they receive promptly.

Absence

Finally there comes the morning after the night before.

Where the Christmas party takes place on a working night, there is always the possibility that employees will “pull a sickie” the next day as a result of over-exuberance.

According to Pam it may be an idea to warn staff in advance that unauthorised absence the day after the Christmas party may result in disciplinary action. To mitigate this risk, employers could encourage employees to book annual leave, subject to maintaining adequate staff levels.

Where an employer has a suspicion that the real reason for unauthorised absence is too much alcohol the night before, they must ensure this is in fact most likely the case before taking any action and apply any sanction consistently in line with other cases.  Failure to do so may result in unsafe disciplinary decisions being made.

Ultimately the Christmas party is about rewarding and thanking your staff for their efforts over the preceding year. Following the basic steps above in advance of the party will only serve to enhance everyone’s enjoyment of it.

If you have any query arising from this update, please contact Pam Sidhu on 0121 233 4333 or psidhu@wilkes.co.uk

Costs update in the Employment Tribunal – Litigant in Person

Costs awarded in the Employment Tribunal are uncommon. Costs awarded against ‘Litigants in Person’ (people who represent themselves) are even more unusual. Despite this, in the recent case of Liddington v 2gether NHS Foundation Trust the Employment Appeal Tribunal (EAT) awarded costs against Ms Liddington (the litigant in person) for failing to give sufficient detail and clarify her claims despite been given several opportunities to provide the evidence requested of her.

Sarah Begley of The Wilkes Partnership considers the key points of the decision and the impact this could have on future Employment Tribunals.

Ms Liddington was a community practitioner working for 2gether NHS Foundation Trust. After making a safeguarding referral in relation to a patient, Ms Liddington complained that she was subjected to a number of detriments by her employer before being dismissed. She brought various complaints as a litigant including; constructive unfair dismissal, religious discrimination and whistleblowing.

Unfortunately, Ms Liddington was unable to give the specifics relating to her complaints namely; the key dates, what was said or done and by whom.

The Employment Tribunal has the discretion to make a costs order where a party has acted unreasonably when issuing or conducting proceedings.

Whilst it was acknowledged that the standard of pleadings expected of a lawyer did not apply to a litigant in person, the Claimant was expected to be able to articulate her complaints in lay person’s terms. Although the tribunal accepted that Ms Liddington was not trying to cause deliberate difficulties and delays, her repeated failure to recall the key details regarding what happened, in the opinion of the EAT, did not meet the low standards expected of a litigant in person entitling the employer to an award of costs against Ms Liddington.

Sarah Begley cautions: “This case serves as a useful reminder of the importance of considering language and formality in conducting proceedings as a ‘Litigant in Person’. Even though expectations of the standard of putting your case is at a lesser level, a failure to provide adequate details can be deemed unreasonable conduct and justify a costs award.”

For advice on any employment related matter and to discuss our Free Employment Health Check please contact Sarah Begley on 0121 733 4312 or sbegley@wilkes.co.uk

More Penalties for Employers of Illegal Workers, Employment Law, Birmingham, Pam Sidhu

As part of its continuing drive to crack down on employers employing illegal workers, the Government announced during the 2016 Budget that it planned to limit the ability of those businesses employing illegal workers to claim Employment Allowance. On 8 November 2016, HM Revenue & Customs published a consultation paper setting out draft regulations that would see this policy implemented.

The Employment Allowance was created in 2014 and entitles most businesses to a reduction in their employers’ National Insurance Contributions of up to £3,000 per year.

The Government is looking to exclude employers of any illegal worker from receiving this allowance. It is proposed that the exclusion will apply from 2018 to those employers who have (i) received a civil penalty from the Home Office for employing illegal workers and (ii) exhausted their appeal rights against the Home Office penalty. Those employers who choose not to pursue an appeal against the civil penalty would also be excluded.

The restriction would apply for the tax year following the year in which the employer exhausts its appeal rights in relation to the civil penalty. As it currently stands, Employment Allowance is claimable only by one company in a corporate group at any one time. If one company within a group were to fall foul of the proposed provisions, all companies within the group would be prevented from claiming the Allowance for the period the restriction takes effect.

The Home Office has estimated that approximately 2000 businesses would be affected by this change. In order to limit their exposure to the provision, businesses must be careful to check the eligibility of all new starters and be confident of the status of existing employees.

Pam Sidhu, Head of Employment at Wilkes comments: “The Government is continuing its crackdown on employers who hire workers who do not have the right to live and work in the UK. Apart from this new development, employers are already subject to fines of up to £20,000 per illegal worker they employ, as well as unlimited criminal fines and penalties. It is increasingly important that all employers should be carrying out the appropriate right to work checks on all new hires, even in the case of UK citizens.”

For advice on any employment immigration matter please contact Pam Sidhu on 0121 233 4333 or psidhu@wilkes.co.uk

Solihull region booming for professionals - The Wilkes Partnership - Birmingham, Solihull, Law

A recent report by NatWest’s Regional Economic Tracker indicates that there has been a 1.6% rise in high-skilled employment in the West Midlands, with the strongest concentration being in Solihull.

It is thought that the expansion of Jaguar Land Rover has contributed towards these results. However, it is not just JLR, Solihull as a whole is performing very well.

In terms of the best regional performers, Solihull saw the number of people in highly skilled jobs stand at 54%.

Sarah Begley, employment Solicitor of The Wilkes Partnership based at their Solihull branch, comments “These results are really positive for our local area. Solihull is often thought of as a town where people enjoy living but it is great to see it is also emerging as a big player in terms of a region where professionals can thrive in their working life”. To keep up with this trend and continue to flourish Sarah encourages local business to think about reviewing their current employment contracts to ensure they are up to date and safeguard their business.

Sarah says “Employment law is one of those areas that is constantly developing and contracts of employment can quickly become out of date. It is particularly important for businesses who grow quickly in terms of staff numbers not to get find themselves unwittingly exposed”.

For advice on any employment related matter and to discuss our Free Employment Health Check please contact Sarah Begley on 0121 733 4312 or sbegley@wilkes.co.uk

Planning and Regulatory Lawyer Birmingham Wilkes

Fees were introduced in both the Employment Tribunals along with the Employment Appeals Tribunal in 2013 and this was not without controversy. Claimants who could previously have brought a claim for free suddenly had to factor in the new fees alongside any legal costs. For example, the current regime requires a Claimant bringing an unfair dismissal claim to pay £250 up-front and then a further £950 if the matter proceeds to a full hearing, amounting to a total sum of £1,200 (subject to the individual being entitled to a fee remission which is uncommon).

Since the introduction of fees, the number of new claims has decreased significantly year on year and Government statistics show a decrease of 52% in the number of claims brought by individual employees in 2014/15 compared to 2013/14.

The Government has announced a review of Employment Tribunal fees with the review scheduled to be completed later this year. The review is intended to determine how successful the fee scheme has been in meeting its original aims, these being (a) transferring some costs from the taxpayer to those who use the tribunal, (b) encouraging parties to seek alternative ways of resolving disputes and (c) maintaining access to justice. The review could result in recommendations being made for changes to the structure and levels of fees currently in place along with possible recommendations for increasing the efficiency of certain procedures in the Employment Tribunal in order to reduce costs.

Lisa Outram comments: “The review into fees is likely to give some hope to employees who have been dissuaded thus far from presenting a claim due to the costs. However, from an employer’s perspective, the fees have arguably helped to prevent unmeritorious claims and reduced time and effort spent to date in defending claims. If the Government is satisfied that the aims of the fee scheme have been met, it is likely that fees could be here to stay. However, it is important to bear in mind that using a tribunal is not the only way to resolve a dispute and alternative dispute resolution can, in certain circumstances, produce a quicker and cheaper result.’

If you would like to discuss any issue or query arising from this update please contact Lisa Outram or your usual contact in the Employment team. Alternatively email us at employmentlaw@wilkes.co.uk or on 0121 233 4333

 

This newsletter does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered.

The Wilkes Partnership, Solicitors, law, Lawyers, Birmingham, Solihull, Employment Law, Unfair dissmisal

Handling the long term sick employee is a costly business at the best of times. Take the example of an employee who has been off sick for many months, exhausted all contractual pay and is simply sitting on the books on statutory sick pay (SSP). After a suitable analysis of the situation by the employer, and often a significant investment of management time and effort (as well as patience), the employer may reach the point at which it is time to dismiss the employee.

What notice pay, if any, is due to the employee in this situation?

Given the employee is not receiving any pay and they will continue to be off sick during the notice period, you would expect that no pay (apart from SSP) is due. However, employers need to bear in mind a peculiar rule tucked away in the employment legislation, which not only vexes employers but also employment advisers. The rule is contained within Section 87 (4) of the Employment Rights Act 1996.

In a nutshell, there is a distinction to be drawn between an employee who has a contractual notice period of one week or more than their statutory notice entitlement and those whose contractual entitlement is less than this, usually set at the statutory maximum.

The rule was applied in a case called Scotts Company (UK) Ltd v Budd [2003] IRLR 145. Mr Budd had 12 years’ service and therefore was entitled to 12 weeks’ statutory notice. Amongst other issues considered, the Employment Appeal Tribunal concluded that Mr Budd was not entitled to any remuneration during his notice period as his contract provided for a 13 week notice period, one week more than his statutory entitlement of 12 weeks. Had Mr Budd’s contractual notice period been 12 weeks only, then he would have been entitled to receive full contractual salary for that period. This is, in the eyes of most, rather illogical but the current legal position.

Practical points

Employers should check notice periods in their contracts of employment – it may be worth having a notice period that is at least one week more than the statutory notice period. In some circumstances, this can prove to be cost effective as the Budd case illustrates.

Aside from the matter of notice periods and pay, employers should bear in mind issues relating to unfair dismissal, disability discrimination, holiday pay and any other contractual benefits when dismissing an employee due to long-term sickness absence.

If you have any queries arising from this update, please contact Darryll Thomas on 0121 733 4312 or the employment team by email employment@wilkes.co.uk.

 

This newsletter does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered.