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Oliver McCannn   


Employers Update - January 2011

Welcome to the first Employ! edition for 2011.

Taylors Solicitors will continue to keep you up dated on relevant developments on HR and employment law during what is likely to be a challenging year for many.

We would like to wish you all the best for 2011 and if you want to meet to discuss or plan your requirements for 2011, particularly with the removal of the default retirement age this year, our team would be only too happy to assist. It is best practice to review your employment policies, practices and procedures at least annually.

If you have any queries or wish to have a chat about Taylors Employment Services please contact Oliver McCann on 0844 8000 263 or oliver.mccann@taylors.co.uk.

Oliver McCann - Partner and Head of Employment
James Bellamy - Employment Solicitor

Tel: 0844 8000 263
Email: oliver.mccann@taylors.co.uk


In This Edition:

» Retirement
» Instructions to Discriminate
» Protection For IVF Employees
» Corporate Liability For Bribery!
» Your Questions

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This is likely to be the hot topic of 2011 and it will be interesting to see how differently the abolishment of the default retirement age will be approached by the different sectors and industries.

The government confirmed earlier this month, as expected, that the default retirement age will be phased out completely from 6th April 2011 with complete abolition on 1st October 2011. There is a useful ACAS flowchart showing the transitional arrangements at this link.

In a nutshell if you have an employee who reaches 65 before 30 September 2011 then you can retire that individual but you can only do so in line with current legislation up to 5th April 2011. However after the 30th March 2011 you will be relying on the short notice retirement provisions under current legislation which carry with it some risk of claims being brought.

What do I need to know?
ACAS has published a useful guide here.

Once abolished the options available to an employer are:

  • Set up your own contractual retirement age – this must however be objectively justified and will be known as Employer Justified Retirement Age. Any such contractual retirement agreement should only be put in place after extensive discussions with a recognised trade union or employee representative and based upon solid information to support the imposition of the retirement age.
  • Proceed without a defined contractual retirement age and work on a case by case basis. Any retirement will still have to objectively justified but such a process opens up the risk of challenges that other employees are being treated more or less favourably and could result in other discrimination claims due to a lack of a consistent approach.
  • Proceed on the basis that retirement is too high risk now and the focus needs to be on performance and capability management dismissals– however, again, care needs to be taken not to deliberately target an older worker and treat them less favourable than younger workers who maybe just as incapable or performing just as bad otherwise an age discrimination claim will follow.

Instructions to Discriminate?

Employers need to ensure that they, or their management staff, do not give instructions to staff to engage in unlawful discrimination.

A recent case involved the employer transforming a former gay pub into a gastro pub. As part and parcel of the rebranding exercise the employee was instructed to display a board outside the pub openly stating it was no longer a gay pub and also seating customers who did not appear to be gay in prominent positions.

It was held that this less favourable treatment of third parties on grounds of their sexual orientation (actual or perceived) amounted to less favourable treatment of the employee as well who was therefore entitled to compensation.

What do I need to know?
The case clearly sets out the principle to be taken on board but reiterates the importance of putting in place a detailed equal opportunities policy which is easily understood by all staff and which management buy into. Critical to avoiding matters of this nature is rolling out a programme of training on your equal opportunities policies across the board and ensuring that line management are empowered to enforce its provisions.

When Does Protection Begin and End For IVF Employees?

A recent case has set out some guidelines as to when an employee receiving IVF treatment becomes protected from less favourable treatment and when it gains the same protection as a natural pregnancy.

It was held that a woman undergoing IVF treatment is regarded as pregnant from the period of implantation of a the fertilised ova until the end of compulsory or statutory maternity leave (ordinary or additional) or when the employee returns to work, which ever is the earlier.

In the period before implantation it may constitute sex discrimination to treat a woman less favourably because she is receiving IVF treatment but limited to a defined period i.e. between follicular puncture and the immediate transfer of the in vitro fertilised ova in to the uterus.

What do I need to know?
Take care on how you treat an employee who is undergoing IVF treatment. Usually it will be difficult to know exactly what stage of the IVF process the employee is at – they are not obliged to tell you this information. As such, although there is the “defined period” of protection as set out in this case, often it will be difficult to determine when the period has in fact started. As such, best practice would be to treat those receiving IVF treatment, with care and if they are seeking some kind of special treatment or leave to sit down with the employee and understand where in the process they are.

Corporate Liability For Bribery!

Bribery is the offer or acceptance of a reward to persuade someone to act dishonestly and/or in breach of the law. This can be an expensive business and companies have faced fines in excess of £100m as a result.

What do I need to know?
The Act provides for four bribery offences:

  • Bribing – the offering, promising or giving of an advantage.
  • Being bribed – requesting, agreeing to receive or accepting an advantage.
  • Bribing a foreign public official.
  • The "corporate offence", where a commercial organisation fails to prevent persons performing services on its behalf from committing bribery.

The new corporate offence will be of most interest to employers. A company will be guilty of this offence if a person who performs services on behalf of the organisation (an employee, worker or consultant) bribes another person, intending either to obtain or retain business for the company, or to obtain or retain an advantage in the conduct of the company's business. The offence can be committed in the UK or overseas. If a company is found guilty of corporate bribery, both the company and its directors could be subject to criminal sanctions, including significant fines and an increase from 7 to 10 years imprisonment.

The Government has confirmed that the Bribery Act 2010, set to come into force this April, will be reviewed but it is expected only minor changes will be made.

The government will be publishing guidance to help organisations put practical measures in place to prevent bribery and mitigate their exposure of a prosecution.

A company can escape liability if it can show that it had in place "adequate procedures" designed to prevent those persons performing services on its behalf from committing bribery.

As such, if it is proved that a bribe was paid on a company's behalf with the intention to obtain or retain business for the company, an offence will have been committed for which the company will be liable, subject to the "adequate procedures" defence.

What constitutes adequate procedures to prevent bribery is the key question but the answer is not currently clear and expected guidance is due from the government soon "about the procedures that relevant commercial organisations can or are expected to put in place to prevent persons associated with them from bribing.

It is likely that organisations will have to promote and develop an anti corruption programme and culture, establish a clear code of conduct together with a gifts policy. There may need to be express clauses inserted in to contract of employment and training given across the organisation. There should always be adequate financial controls in place and a whistle blowing policy to aid disclosures of corruption to be made.

Your Questions Answered

1. When can you commence without prejudice discussions with an employee during a redundancy process?

Without prejudice discussions can protect you from that employee later using what is said in evidence. But to gain protection under the without prejudice rule there has to be a dispute which you are making genuine attempts at settling by having the “without prejudice” discussion. Such a conversation should be left until you have at least identified a particular employee who will be made redundant after a full consultation and/ or selection matrix. However to commence discussions early suggests a lack of confidence in your process and will arouse suspicion. Better at the decision stage to put forward, in a separate letter, an offer to pay an ex gratia sum, purely in recognition of service and as a gesture of goodwill, but only on the condition they sign a compromise agreement.

2. We have a cleaner that we employ who starts at 4.30 every evening and works till 6.30. She has worked for us for a number of years but this situation is not working. Our business is open till 5.30 and so she is cleaning around clients and other third parties which is not conveying a professional look. She claims she cannot work later than currently is the case and nor can she work early in the morning due to childcare and other work commitments what are my options?

You can do one of two things:

  1. You can enter into consultation with her about changing her hours as the business requirements are such that the current working arrangements are no longer viable. You need to understand whether contractually you can alter her hours of work or whether by changing the hours, if she refuses to agree, you maybe in breach of contract. Worse case scenario is she refuses to agree, there is no contractual right to vary the hours and you need to terminate her employment on grounds of the needs of the business. There is of course a risk of unfair dismissal and possible indirect sex discrimination, but the level of her earnings maybe such it is a risk worth taking. Critical to any process is meaningful consultation.
  2. A second alternative would be to outsource the cleaning duties to a cleaning contractor. There would be TUPE issues which arise but you could stipulate to the contractor that you did not want anyone starting before 5.30. You would however, in the process of outsourcing the service, have to provide them with the details of the employee and her terms and conditions. It would then be up to the contractor to determine if they wished to take on the problem relating to the employees working hours.

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