The Employers Update - September 2010
Welcome to this month’s edition
of Employ!
This month we take a glance at some
of the key aspects of the Equality
Act 2010 as well as the most recent
Employment Tribunal statistics and
the recent successful launch of The
HR Exchange.
If you have any queries in relation
to the content of Employ, or any
employment issue, please call the
Employment Team on 0844 8000 263
or email
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
|
|
|
On the 1st October 2010 the Equality
Act 2010 becomes law – however a recent
Order published by the government has now
clarified which parts of the Equality Act
are to come in to force and those which will
not be present.
The primary function of the Equality Act
is to harmonise the core provisions of 9
different pieces of discrimination
legislation – rather than separate
discrimination acts i.e. sex, race, there
will be one act which protects “protected
characteristics”. The principles will
largely remain the same as before all though
the defence of objective justification will
now be applied to all protected
characteristics.
However there are a few new areas being
introduced (or now no longer being
introduced at present) which all employers
need to be aware of. So what do I need to
know?
Discrimination
- There will be a new concept of
discrimination “arising from a
disability” – effectively reversing the
decision on Malcolm v Lewisham BC which
obliterated the concept of disability
related discrimination due to changes in
who the comparator should be.
- Discrimination by association and/or
perception will be expressly prohibited
across for all protected characteristics
- Employers maybe liable for
harassment by third parties in the
workplace
Public Sector Equality Duty
- this was intended to be replaced by
a single unified duty but has now been
temporarily suspended.
Positive Action
- it was also intend that employers
would for the first time be able to
adopt positive action in the recruitment
selection and promotion process
(previously it was limited to job
advertisements) but only in
circumstances where the successful
candidate is from a protected group
which is at a disadvantage or
under-represented within the
organisation and where the successful
candidate is as qualified as any other
eligible applicant. This too has been
suspended.
Pre Employment health questions
- pre-employment questions on a
job applicants health (whether at
interview or in a medical
questionnaires) will be banned until the
point at which a job offer is made.
There are exceptions which apply where
the health questions are to monitor
diversity, to make special arrangements
for interview/recruitment assessments,
to take positive action, because a
disability is a genuine occupation
requirement or to establish whether the
applicant will be able to carry out a
function that is intrinsic to the work
concerned (although take care on this
latter exception!). This will come in
to force!
Secrecy Clauses
- such clauses will be unenforceable
against an employee where there is a
relevant pay disclosure (for example
where an female asks a male comparator
to establish if there is a difference in
pay). This will come in to force.
Pay transparency
- the government intended to have the
power to require employers to publish
information relating to differences in
pay between male and female employees
where the employer employs 250+ (private
sector) or 150+ (public sector)
employees. This will apply to the public
sector from April 2011 but the
provisions relating to the private
sector have been suspended.
There seems no end in sight to the
trend of rising employment tribunal claims
year on year. 2009-10 is no exception with a
record high of claims accepted by the
Employment Tribunal - 236,100 being a 56%
increase on the previous year.
The number of unfair dismissal claims has
risen yet again to a high of 57,400.
Unlawful deduction of wages claims have more
than doubled with redundancy pay claims also
nearly doubling. All other claims are more
or less static except for Working Time
Directive claims which have tripled!
The highest award for unfair dismissal
was £234,549 with the average award being
£9,120. In relation to discrimination claims
the highest awards were:
Race - £374,922
Sex - £422,366
Disability - £729,347
Age - £48,710
What do I need to know?
Although claims maybe rising there are
some simple steps which can be taken to
reduce your exposure:-
- Ensure you have in place contracts
of employment and a Staff Handbook which
sets our your rules, policies and
procedures .These are the foundation of
any employment relationship.
- Prevention is far cheaper than cure!
Take pro-active legal advice on HR and
Employment issues before they develop in
to a dispute or to head them off!
- Consider taking out Employer
Protection Insurance which will insure
you against the cost of defending claims
as well as any Tribunal award or
settlement –
see Taylors Scheme here.
Taylors, in association with its
corporate partners, launched The HR Exchange
on the 16th September 2010. Full details,
including event handouts, can be located at
the events archive section of
The HR Exchange website.
What do I need to know?
Future events will occur quarterly with
the next event schedule for 9th December
2010.
A recent decision has highlighted the
dangers of alleging a redundancy situation
in circumstances where a team is effectively
replaced by identical roles requiring the
same skills and abilities but labelled as
“higher quality”.In the case of CIBC
v Beck, Mr Beck aged 42 was Head of
Marketing until he was dismissed on grounds
of redundancy. A recruitment process was
undertaken concurrently with the redundancy
process to find a new Head of Marketing. The
person specification referred to “seeking
younger, entrepreneurial profile (not a
headline rainmaker).
It transpired from the recruitment
process that the Company in fact interviewed
a range of candidates, with a preferred
candidate being aged 50. Eventually a Head
of Marketing was appointed who was 38 years
of age. The Company argued that reference to
“younger” meant less senior individual who
would be less expensive than the Claimant.
It was held by both the Employment
Tribunal and the EAT that there was no
redundancy situation and as such the
dismissal was unfair. The new role required
the same skills as before. The Claimant also
succeeded in a claim for age discrimination
establishing that the only attribute he
could not satisfy from the job specification
was being “younger”.
What do I need to know?
In this current climate it is common for
businesses to reorganise their
organisational structure which can include
potential redundancies.
Where however a redundancy is to be
followed by the recruitment of another
individual extreme care needs to be taken to
ensure that the original position is truly
redundant i.e. reduced requirement for
employees to carry out work of a particular
kind (s.139 ERA 1996). If the new position
genuinely requires an employee with
different skills, capabilities and
experience then this may be sufficient to
satisfy the redundancy definition.
Consideration must be given to whether the
new position constitutes a “suitable
alternative” such that it must be offered to
the redundant employee to avoid an unfair
dismissal or whether it so distinct it would
be appropriate to require the redundant
employee to apply and be interviewed for the
new role in order to assess suitability.
An employee was held to have been
unfairly dismissed because the allegations
set out against her in the investigatory
process and subsequent disciplinary invite
letter were not correctly framed!In
this case the Claimant was a catering
manager who worked for a catering company
supplying services to a 6th Form College.
She had responsibility to account for all
takings taken from the students and sort the
takings for banking. £3000 went missing. She
was subsequently accused of incorrect stock
procedures, discrepancies in the finances
and a failure to follow accounting
procedures relating to the “loss of £3000”.
However the Employer admitted they suspected
her of theft/dishonesty and indeed the
disciplinary officer dismissed the Claimant
as she believed on the balance of
probabilities that the Claimant was guilty
of theft of £3000.
The dismissal was held to be unfair
because the Employer had failed to precisely
set out their allegation of dishonesty
against the Claimant, holding that it was a
fundamental right that someone accused of
dishonesty should have that point made to
them. It found that the reason for dismissal
differed to the actual allegations put to
the Claimant even though the Claimant
suspected she was being accused of theft.
What do I need to know?
- It is critical to ensure that your
allegations of misconduct are accurately
set out in the disciplinary invite
letter – in this case the Employer was
guilty of trying to be too neutral in
its allegations!
- When setting out allegations in a
disciplinary invite letter try to marry
the allegations up with examples of
gross misconduct offences set out in the
Employee Handbook and enclose a copy of
the disciplinary rules and procedures
with the invite letter
- Make sure your decision is based on
the actual allegations put to the
claimant – if you find yourself
considering misconduct issues which have
not been properly alleged against the
employee then it maybe necessary to
start the process again before a
decision is made.
1. I am giving notice to terminate a
contract of employment. We have the right to
make a payment in lieu of notice (PILON) and
wish to exercise that right. When do I have
to make the actual payment? I am intending
on making it in the next months payroll
which will be 3 weeks after the termination
date?
It is critical that you make the employee
aware that you are exercising your right to
make a payment in lieu of notice by
confirming that in the dismissal letter. The
effective date of termination (“EDT”) will
not be established until it has been brought
to the employee’s attention.
There have been a number of cases on
PILON clauses but none on when the payment
actually has to be made. The EAT has
previously stated that in establishing the
EDT you must ask the question "What would a
reasonable employee understand it to be from
the words used". This would suggest that
provided it is plainly clear in the
termination letter that you are exercising
the right to make a payment in lieu and you
subsequently make that payment then the date
of termination will be as stated in the
letter. It matters not if the payment was
made 3 weeks thereafter.
I would advise however that you inform
the employee when the payment will be made
so and seek his agreement that he is happy
for that to occur. If no such objection
arises then the EDT will be as stated.
Despite there being no case law, there is
legal commentary which states that if a
dispute arises on the EDT when payment is
made after termination then the dismissal
letter should clearly state what the EDT is.
2. I have recently taken on an 18 year
old student at an agreed rate between her
and her college of £97.01 per week. The
needs of the business have changes and we no
longer require her. Can I simply dismiss her
bearing in mind she has less than 12 months
service?
It sounds like this student maybe classed
as an apprentice, particularly as she is
earning less than the National Minimum Wage
and there is a tri partite relationship
between you, the student and the College.
You need to fully explore her working status
before taking any further action.
Apprentices have greater protection from
dismissal than normal employees with less
than 12 months service. You may have to
honour the contract for the duration of her
studies/training or find an alternative
employer who could continue with her
apprenticeship. Nothing short of the
business closing down will entitle you to
dismiss an apprentice on redundancy grounds.
Copyright 2006 - 2010 Taylors Solicitors
»
Print
» |
