Employment Legislation – Recent Important changes and a Timetable for the coming months

October 2013

• Minimum Wage rates; From 1 October 2013:
• the adult rate will increase from £6.19 by 12p to £6.31 an hour
• the rate for 18-20 year olds will increase from £4.98 by 5p to £5.03 an hour
• the rate for 16-17 year olds will increase from £3.68 by 4p to £3.72 an hour
• the apprentice rate will increase from £2.65 by 3p to £2.68 an hour, and
• the accommodation offset will increase from £4.82 to £4.91.

Under the Equality Act 2010 an employer can be vicariously liable for harassment by a third party (such as a customer or a contractor) if (a) that third party had harassed an employee on at least two previous occasions; and (b) the employer had failed to take reasonably practicable steps to stop the harassment.

This is now being repealed, with effect from 1st October 2013. Protection from harassment remains covered by the Equality Act and other legislation.

September 2013

Rehabilitation of Offenders 2013

Following a Court of Appeal challenge, changes have been made to the Rehabilitation of Offenders Act, so that minor historical offences no longer interfere with an individual’s right to work in certain jobs. The Disclosure & Barring Service has produced a Guide for Employers on ‘filtering’ – being convictions/cautions which no longer appear on criminal record checks because of changes in legislation. Access to the Guide is at;

www.gov.uk/government/news/disclosure-and-barring-service-filtering

The Ministry of Justice has suggested the following template question for use by Employers in its recruitment process: ‘Do you have any convictions, cautions, reprimands or final warnings that are not “protected” as defined by the Rehabilitation of Offenders Act 1974 (Exceptions) Order 1975 (as amended in 2013)

TUPE

Changes to the Transfer of Undertaking (Protection of Employment) Regulations 2006 (TUPE) were originally to come into place in October 2013, but the Government is only planning to publish its response to the consultation to the change this month, setting out the draft in December 2013. This means they are likely to come into force in January 2014.

Employee Shareholders

Despite overwhelming rejection of these proposals during “consultation”, they are here anyway!! This legislation creates a new type of employment status, whereby employees “give up” a bundle of employment rights (most unfair dismissal claims and statutory redundancy payments, plus the right to request flexible working and longer notice on returning from Maternity Leave) in exchange for an award of shares worth at least £2,000. There are several safeguards, including a right to a statement detailing the shares, a requirement for the employee to take legal advice, and a 7-day cooling off period.

According to the CBI, by early September not one enquiry had been made to their Employer helpline on this topic. A case of we told you so maybe!?

August 2013

The Information Commissioner has produced a Code of Practice on how to deal with a subject access data request. It provides guidance for data controllers on how to respond to subject access requests, explains how to deal with requests involving other peoples’ information, and gives practical examples of requests and various exemptions. It is a mere 58 pages long!! See it at www.ico.org.uk

July 2013

The following changes in employment law came into force on 29th July 2013.

• The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 SI 2013/1237. The new rules combine separate case management discussions and pre-hearing reviews into one preliminary hearing and introduce an initial paper sift. A number of other procedural changes to tribunal operation also introduced.
• A new ET1 claim form has been introduced including information on how to claim “remission” ie be excused from all or some of the fee payment due to lack of resources.

Tribunal fees commence

From 29 July fees will be charged for both Tribunal and Appeal Tribunal (EAT) applications and hearings. There will be two main charges; the issue of a claim, and the final hearing of a claim that proceeds that far. Different fee levels will apply for employment tribunal claims, depending on whether it’s a level 1 or level 2 claim. The issue fee will be £160 and the hearing fee £230 for a level 1 claim (straightforward claims like a failure to pay notice). For level 2 claims (which will be most claims, including unfair dismissal), the issue fee will be £250 and the hearing fee £950. There will only be one level of fee for claims submitted to the EAT; an issue fee of £400 and a hearing fee of £1,200.

• Settlement Agreements. Most offers made, or discussions held, with a view to terminating an employee’s contract on agreed terms, will be inadmissible as evidence to a tribunal in an unfair dismissal claim; providing there has been no unreasonable conduct! See below for more and refer to Section Two for the detail

• A cap of 52 weeks” pay on unfair dismissal compensatory awards in addition to the current cap of £74,200.

(Note: Where a tribunal finds that an employee has been unfairly dismissed, they make an award of compensation to the ex-employee which the employer must pay (many do not apparently but that is another story!!).There are two parts to the award:

The Basic Award – this is calculated in a similar manner to statutory redundancy payments and is linked to age, length of service and pay.

The Compensatory Award – this is calculated as the loss of earnings suffered by the ex-employee due to the unfair dismissal and may include an element for future loss of earnings (which is estimated by the tribunal taking into account the evidence provided relating to the job market, etc.)

The Compensatory Award has always had a cap which has been increased each year in line with inflation.It is currently £74,200.However, this has now been restricted further so that it will be limited to 52 weeks’ pay or the maximum cap (£74,200), whichever is lower.The maximum cap will continue to be increased year on year, but the 52 week restriction is unlikely to be altered. From 2014 the annual review of the statutory cap will be in April each year, not in February as before.

In the vast majority of cases, therefore, compensation will be limited to a year’s pay. In reality most compensation awards only amount to a few thousand pounds, so there is unlikely to be much real impact.However, this could still be good news for employers. If you ever wish to broker a settlement agreement with a problem employee, it is useful to be able to have this 52 weeks compensation backstop in mind during negotiations.Some employees see the headline £74,200 figure and have very unrealistic expectations in negotiations in terms of what they believe to be a reasonable settlement sum.Whilst a year’s pay is still likely to be far too high in most negotiations, it at least sets a much more realistic upper limit and a start point for settlement discussions.

Settlement Agreements introduced.

New legislation which enables discussions about pre-termination settlement offers to remain confidential without the fear of these being referred to in a tribunal in a subsequent unfair dismissal claim is now in place. An ACAS Code of Practice on Settlement Agreements has been published. The changes from the initial draft include:

• A new paragraph sets out the statutory requirements for valid settlement agreements and provides general guidance on best practice as well as the legal requirement.
• The addition of a recommendation that employees should be allowed to be accompanied by a colleague or trade union representative at any settlement meetings.
• An increase in the minimum time period that employees must have to consider any offer – now at least 10 calendar days (increased from 7 in the previous draft).
• The removal of the requirement that the initial offer must be in writing – so these may now be made verbally, although any final agreement must be in writing.
• The template letters have been removed from the Code and will be included in the non-statutory guidance.

The Code contains examples of “improper behaviour”. It also confirms that there are no changes to the existing ‘without prejudice’ principle that applies to negotiations aimed at resolving an existing dispute; nor does it affect the conditions that must be satisfied for a valid compromise agreement (such as the need for a written agreement following independent legal advice).

June 2013

Political protection

The Government has made an amendment to disapply the qualifying period (of 2 years) for claiming unfair dismissal “if the reason (or, if more than one, the principal reason) for the dismissal is, or relates to, the employee’s political opinions or affiliation”. This amendment seeks to implement the decision of the European Court of Human Rights in Redfearn v UK. This involved a bus driver, who was dismissed over his membership of the BNP. It does not make a dismissal on the basis of political opinion or affiliation automatically unfair, but simply permits such an unfair dismissal claim to be heard on normal principles without the need for qualifying service.

The Disclosure and Barring Service (which replaced the Criminal Records Bureau at the end of last year) is launching its new Update Service on 17th June 2013. The Update Service will reduce bureaucracy by allowing Disclosure and Barring Service (DBS) certificates to be re-used when people apply for similar jobs.

Previously called a ‘Portable DBS/CRB check’, job applicants will pay a fee of £13 a year, in exchange for which prospective employers can carry out a free ‘update’ search to check their DBS certificates remain valid / up to date. This is cheaper (and much quicker) for employers, but of course shunts the cost of DBS checks onto the employee.

There’s lots of guidance, and even some PowerPoint slides, on the DBS (Disclosure and Barring Service) website.

Whistleblowing “loopholes” closed

The Public Interest Disclosure Act was introduced to allow employees to make protected disclosures in certain circumstances. Such disclosures should be made in good faith and should be in the public interest. Workers have sometimes argued that a breach of their contract of employment can qualify as a protected disclosure, which is not a public interest matter. The Courts agreed with this interpretation in a case involving Sodexo and an Employee who raised an issue with his own terms of employment. Recognising that such actions are an abuse, an amendment came into force on 25th June 2013. A disclosure will not be protected unless the employee reasonably believes that the disclosure is made in the public interest. NB The disclosure doesn’t have to be in the public interest; it is enough if the worker reasonably believes it to be in the public interest, a subtle but important distinction.

A disclosure no longer needs to be made “in good faith”, but if the tribunal thinks that the disclosure was made in bad faith, (i.e. is motivated primarily by money or spite, rather than a desire to put right a wrong), it will have the power to reduce compensation by up to 25%.

Another “gap” in the original legislation meant that an employee could be harassed by colleagues after Whistleblowing, and the Employer was not liable (vicariously) for these acts. That has changed. Employers can now be vicariously liable where a worker is subjected to a detriment by a colleague because he made a protected disclosure, unless the employer has taken all reasonable steps to prevent the detriment.

April 2013

Statutory Payments increase

Payments for Maternity, Paternity and Adoption leave increase on 7 April to £136.78 per week.

Statutory Sick pay increases to £86.70 per week.

Parental Leave entitlement, which is unpaid and available after one years service, is increasing from 13 weeks to 18 weeks, effective 8 March 2013.

New rights for Adoptive Parents and changes to the Statutory adoption leave and pay levels are to be introduced later. A new right for fathers to take unpaid leave to accompany their partners to two ante natal classes has also been announced.

Consultation period on proposed dismissals

From 6 April 2013

Employers will only need to consult with their workforce 45 days before large scale redundancies. The minimum 90 day consultation period is halved from that date, when100 or more dismissals are proposed in a 90 day period. ACAS is to issue guidance on the subject to promote good quality redundancy consultation.

Discrimination questionnaires to disappear

The Government proposed the removal of Questionnaires from the process of discrimination claims, arguing they were little used and added no significant value to the handling of claims. A claimant could, in the past, send a questionnaire to their employer to obtain information to support a possible claim for discrimination. Likely date for this is April 2014.