HR News Round-up
HR News Round-up
Review of Employment Tribunal Fees
This summer has seen Unison return to Court for the third time in their on-going challenge following the introduction of Employment Tribunal fees in July 2013. This time Unison have been granted the right to appeal against the decision taken by the High Court in December 2014, who had ruled that there was still insufficient evidence to show that the introduction of fees were acting as a barrier to individuals wishing to access justice in employment cases. The appeal was heard on 16th and 17th June 2015 and it is reported that it will be some time before any judgement is announced in this case. So, the waiting for an outcome to this on-going saga continues...
In the meantime, the Government also announced in June that they would be commencing their own review of the Employment Tribunal fee structure. Although this review appears to have been timed to coincide with the Appeal Hearing, it being announced on 11th June; this is in fact a long-standing commitment to review the impact following the introduction of fees, given by the Government at the time. The review will consider a range of evidence in connection with Employment Tribunal fees including:
data on case volumes, progression and outcomes
qualitative research on the views of the Courts and tribunal users
the general trend of the number of cases being heard at Tribunals before the fees were introduced
any consequence arising as a result of an improved economy on the number of people being dismissed
to what extent there has been a discouragement of weak or unmeritorious claims
whether there has been any impact because of changes in employment law
any other reasons for changes in user behaviour
Obviously, any decision taken by the Appeal Court will also be taken into account as part of this review and we will continue to monitor both areas and report back as soon as any update is known... In the meantime; check out our blog for our thoughts on Employment Tribunal fees...
...back to top
The Living Wage
Despite neither of the major political parties having committed to adopting the ‘Living Wage’ within their election manifestos; 3-months on from the General Election and it would seem that the new Conservative Government have shifted their position and Chancellor, George Osbourne announced within his summer budget that a Living Wage of £9.00 per hour will be in place from 2020.
The living wage is defined as being the minimum amount of money that an individual needs to earn in order to pay for their basic living costs and have a minimum acceptable standard of living. The decisions on what should be included in these standards are made by groups which include members of the public and is therefore rooted in a social consensus about what people need to make ends meet, as opposed to being determined by some think tank away in their ‘ivory tower’.
It is calculated on two levels; by the Greater London Authority for those living in London and by the Centre for Research in Social Policy at Loughborough University for the rest of the United Kingdom. Currently, these levels are set at £9.15 in London and £7.85 for the rest of the country. At the present time, the statutory requirement is for employees to be paid the national minimum wage based on their age and the living wage has been a ‘voluntary benchmark’ which employers could sign up to if they chose to do so.
The announcement of the living wage came right at the very end of the budget speech and will be introduced from April 2016, at a level of £7.20 per hour, for those aged 25 and over. Given this starting age and with the greater detail yet to emerge, we can presume that the National Minimum Wage in its current guise will continue for those employees aged up to 25.
Employers with employees aged over 25, will therefore need to budget for an extra 70p per hour over the coming 9-months to meet this new pay rate. Thereafter, for that group of employees, the likelihood is that the rate will continue to rise by approximately 5.7% each year in order to meet the target of £9.00 per hour by 2020. It should be noted that alongside this announcement, the Chancellor also announced that employer’s National Insurance allowance will also raise from £2,000 to £3,000 per annum; meaning that for an employer with 4 employees aged over 25, the effect of the living wage will be ‘cost neutral’.
...back to top
Increase in National Minimum Wage Rates ~ 2015
Following on from the announcement of the Living Wage, it is worth giving a reminder of the National Minimum Wage rates, which as usual will be increased with effect from 1st October 2015. The rate for adult workers aged 21 and over will increase from £6.50 an hour to £6.70 per hour; meaning that those employed for 30-hours per week on the minimum wage will continue to sit below the minimum earnings threshold at which PAYE becomes payable.
There will also be increases for those workers aged below 20 and apprentices as outlined below:
18 – 20 year old will get a 17p per hour increase to £5.30 per hour (3.5% increase)
16 & 17 year old will get a 8p per hour increase to £3.87 per hour (2% increase) and;
Apprentices will receive an extra 57p per hour, taking their hourly rate to £3.30 (21% increase)
Employers who are employing individuals on one of the minimum wage bands will need to increase their employees’ pay from October this year to the new hourly rate and in the longer-term and from a budgetary planning perspective in line with the introduction of the living wage, it will be sensible to assume that there will be further significant increase announced in the coming years, to ensure that they are prepared financially for this.
...back to top
Trade Union Bill and Strike Ballots
As London continues to be gripped by a wave of Tube strikes and elsewhere in the Country other rail services are facing threats of industrial action by Trades Unions; the Government has published the Trade Union Bill and three consultation documents covering:
Ballot thresholds in important Public Services
Hiring Agency Staff during industrial action
Tackling intimidation of non-striking workers
The key areas that will be subject to this consultation will include:
the need for 50% of eligible union members to vote in a ballot for strike action; with a majority voting in favour of taking the action
a higher threshold to be applied to essential public services including health, education, fire, border security, transport and nuclear decommissioning; 50% of eligible union members will need to vote and a minimum of 40% of those eligible members will need to vote in favour of strike action
any ballot in favour of strike action will only be valid for a four month period
a clear description of the dispute and the type/duration of any proposed industrial action must be included on the ballot paper
the notice given to employers of strike action will be increased to 14-days, from the current notice period of 7-days
to include some aspects of the code of conduct in respect of picketing into legislation
union members will have to opt in to contributing to a Union's political fund, rather than opting out as it is currently
closer controls may be imposed on wider protests organised by Unions
public sector employers and other, as yet unspecified, employers delivering public services will be required to publish information about how much time off they allow to Trades Union officials, with a reserved right to limit the amount and cost of this
the Certification Officer may impose a levy on Unions and Employers Associations to cover expenses
Linked to the Trades Union Bill, but not included within it, is the proposal to lift the current ban on the use of agency workers to cover striking employees.
Whilst the Unions are understandably unhappy with the proposed legislation, it has largely been welcomed by the British Chamber of Commerce and the Confederation of British Industry (CBI); however, an unintended consequence of introducing legislation intended to constrain the activities of Unions to this extent may be the emergence of latent Union members, who are not terribly active generally, but who may become so if they perceive their freedoms to be threatened! The three consultations are due to close on 9th September 2015 and the Bill is not expected to be implemented until next Spring at the earliest.
Cases of Interest ~ Holiday Pay and carrying forward Holiday whilst on Sick Leave
The issue of holiday pay and carry over of holiday entitlement whilst absent from work on sickness absence has been receiving a lot of media attention in recent weeks and these two cases provide some clarity on the issues...
Patterson v. Castlereagh Borough Council;
This Northern Ireland Court of Appeal case found that there is no reason in principle why overtime which is undertaken voluntarily should be excluded from the calculation of holiday pay; the key issue is not whether the employer has an obligation to offer overtime nor whether the employee has a duty to work it, but whether it is performed sufficiently regularly by the employee for any pay they receive for working such overtime to form part of their normal remuneration. In this case, Mr Patterson worked an average of 4-hours overtime each week and following the EAT ruling, the case will be referred back to the Tribunal for them to determine the outcome and in doing so, to provide some definitive guidance on this matter. In the meantime, employers are advised to consider all overtime undertaken on a regular basis, whether voluntary or compulsory, when budgeting for and calculating holiday pay for employees.
Plumb v. Duncan Print Group Ltd
This case has provided some clarity from the Employment Appeals Tribunal in respect of two puzzling areas concerning the carrying forward of annual leave when an employee is prevented from taking it within the leave year because of sickness absence. The first point is that an employee can carry forward accrued but untaken annual leave into a new leave year; even in circumstances where they may have been capable of taking the leave during the relevant year it was accrued. The leave can be carried forward without the requirement being placed on the employee to provide evidence that they have been prevented from taking the leave and means that employees cannot be required to take leave whilst on sick leave. However, as previously established in Sood Enterprises Ltd v. Healy, the carry over of annual leave only applies to the basic 4-weeks leave and not to any additional leave.
The second point of clarification coming out of this case, is that any leave carried forward as a result of an employees sickness absence, can only be postponed for up to 18-months following the end of the leave year in which it was accrued, it cannot be carried over indefinitely. In Mr Plumb's case; he had been absent from work for 4-years following an accident in April 2010, until his eventual dismissal in February 2014. He made a request to be able to take his untaken leave accrued between 2010 and 2013 and was allowed to take holiday for 2013, but not for the previous years. The EAT awarded him compensation in lieu of 4-weeks annual leave in 2012, but he was not awarded anything for 2010 and 2011. Both parties have been given leave to appeal to the Court of Appeal, so this one may run further; but in the meantime, employers can place restrictions on when carried over annual leave is taken.
And Finally...
Political correctness gone mad...
The University of Nottingham has been branded 'idiotic' by employment lawyers after it refused to publish a job title with the word 'junior' in it. The Ad was for a 'Junior PR Consultant' and was being placed with the University's career service by Rhizome PR; the Career's service refused to publish it unless the title was changed to 'entry level', 'graduate' or 'trainee'. Although the Company's managing director, Emily Garnham opted to change the word to 'trainee', she remains puzzled by the University's response and commented within her blog that various dictionary definitions of the word 'junior' include 'lower in rank or status' and stated "in the world of business, while we must all be PC, we are not all equal".
In response; the University have stated "we understand that the term 'junior' could be perceived as discriminatory and so to protect employers who are advertising a vacancy with us, we advise against the use of this term."
In our view; whilst there are some words used in recruitment advertising that could be perceived as being discriminatory, 'junior' is not one of them!!!
Previous Updates: -