Age Discrimination - Life After the Abolition of the Default Retirement Age

Since the abolition of the Default Retirement Age (DRA), it is no longer permissible for an employer to dismiss an older worker on the ground of retirement unless this can be objectively justified under the Equality Act 2010.

This does not mean that employees will never be able to retire, but that an employer cannot lawfully force an employee to retire at a set age unless the age can be objectively justified under the Equality Act. If this is not possible, the employer faces the double threat of a claim for age discrimination and for unfair dismissal.

Employers therefore have two options. These are:

• to stop retiring people and use other dismissal options where necessary; or
• to use an Employer Justified Retirement Age (EJRA).

For a set retirement age to be objectively justified, its use must be a proportionate means of achieving a legitimate aim. This is not an easy test to pass, and businesses who do wish to have in place an EJRA are advised to seek legal advice before choosing this option. An EJRA will normally be appropriate for occupations where retirement at a particular age can be justified on health and safety grounds – for example for airline pilots or fire fighters. Employers must provide evidence that the chosen EJRA is necessary – not based merely on assumptions – and be able to demonstrate that no alternative or less discriminatory action could achieve the same result. Employers who have chosen to use an EJRA must follow a fair procedure, giving the employee adequate notice of their impending retirement and, if circumstances permit, consider any request to work beyond the EJRA as an exception to the normal policy. However, it is important to have procedures in place to ensure consistency of treatment of employees who request to stay on.

Older employees can retire voluntarily at a time of their choosing and draw any occupational pension to which they are entitled under the rules of the scheme. If an employee has given formal notice that they wish to retire, the employer is under no obligation to permit them to withdraw their notice should they change their mind. If, however, an employee has only told their employer that they plan to retire, they can change their mind before formal notice is given.

Great care must be taken if an older employee is performing badly. Procedures for dealing with performance issues must be fair and applied consistently across all age groups. To avoid a claim of unfair dismissal, any dismissal must be for one of the potentially fair reasons for dismissal under the Employment Rights Act 1996. Care must also be taken that any decisions taken by the employer do not discriminate against an employee who has a condition that constitutes a disability under the Equality Act. In such cases, the employer has a duty to make reasonable adjustments to remove any barriers to the employee’s performance.

Group risk insured benefits are exempt from the principle of equal treatment on the grounds of age, so employers who provide such benefits can cease to provide or offer them to employees who reach the State Pension Age, even if they continue to work beyond that age. The age at which group risk insured benefits can be withdrawn will increase in line with increases in the State Pension Age.

In addition, under the pensions auto-enrolment rules, employers are not obliged to enrol workers who have reached the State Pension Age.

Whilst the abolition of the DRA has given employees greater choice and flexibility over when to retire, the move has been criticised as having a negative impact on an employer’s ability to plan workforce requirements to meet future business needs.

The Advisory, Conciliation and Arbitration Service has published guidance for employers, entitled ‘Working Without the Default Retirement Age’, which contains useful advice on a possible framework for workplace discussions that will help identify an employee’s future aims, and gives examples of ways of raising the issue of retirement without asking questions that could be seen as discriminatory.

A Guide to Garden Leave

‘Garden leave’ is the term used to describe the situation in which an employee who has resigned or been dismissed is required to serve out their notice period at home, rather than reporting for work.

Normally, garden leave is used as a protective measure to prevent the departing employee from having access to sensitive data or information that could be useful to a competitor or which would assist them in setting up in competition with their former employer, and from poaching staff.

Whether or not an employer can lawfully instruct an employee to stay away from the office on garden leave during their notice period will depend on whether or not their contract of employment contains a specific clause to this effect and whether the employer’s application of its terms is reasonable. The garden leave clause may be in addition to a ‘non-compete’ or restrictive covenant clause in the same contract.

As restrictive covenants are sometimes difficult to enforce, ensuring that a departing employee is denied immediate access to sensitive data is often sensible. Also, the period of garden leave is not counted as part of the restrictive covenant period.

Where there is no express garden leave clause in the employee’s contract of employment, they could argue that its imposition is a repudiatory breach of contract and claim constructive dismissal.

For the duration of the garden leave, the employee must remain available to work for the employer during normal working hours. They continue to receive their usual salary and benefits, which will normally include bonuses, and can rely on their contractual and statutory rights. As the employee is still bound by their contractual duties, they continue to owe the employer a duty of confidentiality and must continue to act in good faith.

An employee subject to garden leave is obliged to carry out any contractual duties requested by the employer, which may include being asked to return to work. The employer may also place restrictions on contact with clients or other business contacts and impose a ban on making any statements about the employer to the media.

The period of garden leave cannot exceed the employee’s notice period and must not be excessive. In the event of a dispute, the courts will consider whether or not the employee’s skills will suffer as a result of the period out of the workplace.

A General Guide to Recruiting Staff

Getting the recruitment process right is vital to ensure that you not only select the most suitable candidate for the vacancy but also do so without falling foul of the applicable law.

The Law
The Equality Act 2010 is intended to eliminate discrimination from all workplace situations, including recruitment procedures. The Act protects people from being treated less favourably because they have a protected characteristic. The relevant protected characteristics in employment are: age; disability; gender reassignment; marriage and civil partnership; pregnancy and maternity; race (including ethnic or national origins, colour and nationality); religion or belief (including lack of belief); sex; and sexual orientation.

In particular, the Act requires employers to make reasonable adjustments to accommodate the needs of disabled job applicants. This could entail adapting recruitment and selection procedures, such as providing the job application form in large print for someone with a visual impairment, or making sure there are no physical barriers that make it difficult for a disabled candidate to attend for interview.

The Act also contains positive action provisions, which mean that it is not unlawful for an employer to recruit or promote a candidate who is of equal merit to another candidate if the employer reasonably believes that the candidate has a protected characteristic and that people with that characteristic are under-represented in the workforce or suffer a disadvantage connected to that characteristic.

Section 60 of the Act prohibits the use of pre-employment health questionnaires prior to a job offer being made. Employers are not prevented from asking job applicants any questions about their health but can only do so for specific purposes, such as deciding whether they need to make any reasonable adjustments to enable an applicant to participate in the selection process or whether a job applicant can carry out a function that is essential (‘intrinsic’) to the work concerned. Once a person has been offered a job, whether this is an unconditional or a conditional offer, the employer is permitted to ask appropriate health-related questions and require a medical assessment where this is normal practice for all applicants.

All employers must comply with the minimum hourly wage rates for workers as provided for by the National Minimum Wage Act 1998. Also, if you are intending to employ young people, there are restrictions on the number of hours they can work and their working conditions.

It is an offence under the Asylum and Immigration Act 1996 to employ anyone who does not have permission to live or to work in the UK. Advice on how to check that a prospective employee is eligible to work for you can be found on the UK Visas and Immigration website.

Unless there is a specific need to check someone’s criminal record for a job, the Rehabilitation of Offenders Act 1974 provides that it is against the law for an employer to refuse to employ them because of spent convictions. The GOV.UK website provides guidance on the Act. For certain jobs exempted under the Act, for example working with children or in healthcare, employers will need to ensure that a prospective employee is cleared to do the work before they can start. Criminal record checks are now called Disclosure and Barring Service (DBS) checks and are carried out by the DBS. The DBS only issues certificates to the individual on whom a check is carried out, so employers wishing to ensure that an employee is cleared to do a particular type of work must ask to see their DBS certificate. Further information on the DBS can be found on the GOV.UK website.

Under Section 56 of the Data Protection Act 1998 (DPA), it is a criminal offence to require an individual to exercise their subject access rights (under Section 7 of the DPA) to gain access to information about their convictions and cautions and provide that information as supporting evidence regarding a job application.

Employers must also make sure that all personal data received during the recruitment process is managed in compliance with the DPA.

Under the Trade Union and Labour Relations (Consolidation) Act 1992, it is unlawful to refuse employment to someone because they are or are not a member of a trade union.

The Employment Rights Act 1996 requires all employees, whether part-time or full-time, to be provided with a written statement setting out the main particulars of their employment, provided their employment lasts for one month or more. All the required particulars must be given within two months of the start of the employment.

All those involved in the recruitment procedure should receive training on the equal opportunities aspects of the process and other relevant legislation.

Guidance
If the skills required to fill your vacancy are in short supply, you may need to redesign the job in order to make it a more attractive prospect – perhaps by offering a greater variety of tasks, training and development opportunities or flexible working arrangements.

The Job Itself
Clarify the requirements of the job and decide what sort of contract of employment you wish to offer. Produce a job description detailing the purpose, tasks and responsibilities of the job. A good job description not only provides the basis for drawing up a person specification but also helps with induction and training when the successful candidate starts work.

Person Specification – The Ideal Candidate
Profile the knowledge, skills and aptitudes deemed essential and desirable. Consider allocating a weighted score to each, based on their relative importance, to come up with an ‘ideal’ total score. The specification can be used later as a check list when assessing the suitability of each applicant and the candidate’s performance at the interview can be compared with the job specification’s ideal score. Take care, however, not to include unnecessary requirements that discriminate against people with a particular protected characteristic.

The Job Advertisement – Attracting the Right Candidates
It is advisable to select at least two recruitment methods in order to draw on as wide a pool of candidates as possible. Each job advertisement should be designed to attract the right candidate, concentrating on the experience, knowledge and competencies necessary for the role, but must avoid bias against anyone with a protected characteristic. For example, avoid terms that could be seen as excluding someone from applying for a role based on their age. Even requiring a certain level of experience from candidates could be seen as discriminating against someone who is too young to have had the chance to gain that experience.

The Application Form
Using a job application form makes for an easier comparison between candidates, but will not be suitable for all jobs. A form should be designed to capture the information necessary to enable an informed selection of candidates at the initial sift stage. Provide information on any selection tests that will be carried out as part of the recruitment process and whether these will take place before or at the time of the interview. Also, make it clear at what stage any references will be sought. Include copies of the job description and person specification as well as a statement of commitment to equal opportunities. Prospective applicants should be offered alternative ways of providing the requested information to guard against claims of less favourable treatment. For example, requiring a form to be filled out ‘in your own handwriting’, where written English is not a requirement of the post, may discriminate against a disabled person or someone for whom English is not their first language.

Sifting the Applications
Identify the applicants who best meet the job description and the person specification. Ideally, this process should be carried out by two or more people so that it is as objective as possible. Send a letter inviting selected applicants to attend for interview, asking them to advise the organisation in advance if they need particular arrangements to be made to accommodate them on arrival or during the interview.

The Interview
Make sure you have made reasonable adjustments to accommodate any candidate who has indicated on the application form that they have a disability.

The length and style of the interview will depend on the nature of the job, but this should be carefully planned in advance. It should be structured so that each candidate is asked the same questions and is given the same opportunities to demonstrate their suitability for the job. This and the use of a scoring system based on the person specification will make it easier to compare their performance.

If you require candidates to complete a test, this must be free of bias and directly related to the necessary requirements of the job. Any information collected during personality tests must be handled in accordance with the data protection principles laid down by the DPA.

Make formal notes immediately after the interview. These will not only help you to reach a decision as to who is the best person for the job but will also enable you to provide feedback if a candidate requests it, bearing in mind that your reason for appointing or not appointing a particular person may be subject to a challenge under discrimination legislation.

The Successful Candidate
Once you have made your decision and carried out any necessary checks, inform all applicants, in writing, of the outcome as soon as possible.

The letter to the selected candidate should set out the job title; any conditions applying to the offer; the terms (including salary, hours, benefits, pension arrangements, holiday entitlement and place of employment); the start date and any probation period; and what the candidate must do either to accept the offer or to decline it. If the letter is to be the employment contract, or form part of it, it should say so and include the main terms and conditions.

In addition, all employees, whether part-time or full-time, are entitled by law to be given a written statement setting out the main particulars of their employment, provided their employment lasts for one month or more. All the required particulars must be given within two months of the start of the employment, unless the employee is to work abroad for more than one month within two months of commencing employment. In this case, the information must be provided before the employee goes away. See Written Statement of Employment Particulars.

The Advisory, Conciliation and Arbitration Service provides free documents for use when hiring staff.

A Brief Guide to TUPE

The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) apply to any size of business and protect the employment rights of employees when their employer changes as a result of the relevant transfer of a business or a part of one. They implement the EC Acquired Rights Directive.

The Regulations introduced:

• a widening of the scope of the existing TUPE legislation so that they now cover situations where services are contracted out, contracted in or where a contract is assigned to a new contractor on subsequent re-tendering. These are described as ‘service provision changes’. The Regulations do not apply, however, where the service provision is a single specific event or task of short-term duration;
• a new duty on the transferor to supply specific information about the transferring employees to the new employer by providing what is termed ‘employee liability information’.
• special provisions making it easier for insolvent businesses to be transferred to new employers – for example, allowing the parties in such situations to agree to vary contracts of employment in an attempt to assist the economic recovery of the business;
• provisions aimed at clarifying the ability of employers and employees to agree to vary contracts of employment if, for example, the reason for doing so is an ‘economic, technical or organisational' (ETO) reason entailing changes in the workforce; and
• provisions aimed at clarifying the circumstances under which it is unfair for employers to dismiss employees for reasons connected with a relevant transfer.

The Regulations place a duty on both the transferor and the transferee employers to inform and consult representatives of their employees who may be affected by the transfer with a view to seeking their agreement to the measures. The transferor and the transferee are jointly and severally liable for any failure to inform and consult, thus ensuring that each has a clear incentive to comply with the requirement.

Amidst concerns that the 2006 TUPE Regulations as implemented had not achieved what they were designed to do, and claims by businesses that they unhelpfully ‘gold-plated’ the Acquired Rights Directive and were overly burdensome and bureaucratic, the Government consulted on proposed amendments.

As a result, the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2014 came into force on 31 January 2014. As well as amending TUPE, they also made changes to the provisions relating to collective redundancies in the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA).

TULRCA was amended to allow a transferee employer who is proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days to elect to begin consulting representatives of affected employees, including transferring employees, about the proposed dismissals before the transfer takes place, provided the transferor agrees to it and is given written notice of the transferee's intention.

The Government decided not to repeal the TUPE service provision change rules introduced in 2006. However, the Regulations clarified that for there to be a service provision change, the activities to be carried on after the transfer must be 'fundamentally or essentially the same' as those carried on before it took place.

The restrictions on varying the terms and conditions of employment contracts when there is a TUPE transfer were relaxed. The Regulations retained the principle that any variation is void if the sole or principal reason for it is the transfer, but contractual variations are allowed if the sole reason for the variation is an ETO reason entailing changes to the workforce, provided the employer and employee agree that variation or the terms of the employee's contract expressly permit the employer to make such a variation.

A dismissal for a reason connected with the transfer of a business or undertaking is automatically unfair unless the employer can show that the sole or principal reason for the dismissal was an ETO reason entailing changes in the workforce. The Regulations amended the meaning of 'changes in the workforce' to include a change to the place where employees are employed to carry out business for their employer, thereby preventing genuine place of work redundancies from being automatically unfair.

Where the contracts of employment of employees who have transferred under TUPE incorporate provisions of collective agreements as may be agreed from time to time, such agreements negotiated and adopted after the date of transfer are not enforceable against the new employer where the latter does not have the possibility of participating in the negotiation process.

In addition, the Regulations introduced a limit of one year during which collective agreements negotiated pre-transfer continue to bind transferees. After that time, terms of employment can be renegotiated provided the new terms are no less favourable overall to employees than those which applied immediately before the variation.

The Regulations also extended the minimum time period for complying with the rules regarding the provision of employee liability information from 14 to 28 days prior to the date of transfer and businesses with fewer than ten employees are allowed to inform and consult directly employees affected by the transfer when there is neither a recognised independent trade union in place nor any existing appropriate representatives.

The Department for Business, Innovation and Skills has published a guide to the TUPE Regulations as amended.

Collective Redundancy Consultation - An Employer's Duties

Under Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA), employers have a duty to consult with appropriate representatives of employees concerning forthcoming redundancies if 20 or more employees are to be dismissed at one establishment within a 90-day period. Failure to do so can lead to a protective award requiring the employer to pay each affected employee 90 days' pay.

In May 2013, in a decision involving the protective awards payable to employees made redundant by retail chains Woolworths and Ethel Austin, the Employment Appeal Tribunal (EAT) ruled that the words 'at one establishment' should be deleted from TULRCA, in order to give effect to EU Council Directive 98/59EC, which it is intended to implement, and protective awards were payable to former employees who had worked at stores with fewer than 20 members of staff (USDAW and Another v Unite the Union and Others).

The effect of that ruling would be that the duty to consult would be triggered when at least 20 employees were to be dismissed as redundant from a business as a whole, irrespective of the number of people employed in each individual workplace.

Permission to appeal was granted, and the Court of Appeal sought the opinion of the Court of Justice of the European Union (CJEU).

In the CJEU's view, where an undertaking comprises several entities, it is the entity to which the workers made redundant are assigned to carry out their duties that constitutes the 'establishment', not the business as a whole. The term 'at least 20' requires account to be taken of the redundancy dismissals in each establishment considered separately.

Whilst member states are entitled to increase the level of protection afforded to workers when there are to be collective redundancies, they are nonetheless bound by the 'autonomous and uniform interpretation' given to the term 'establishment' in EU law.

The case was referred back to the Court of Appeal to determine whether the stores could be classified as separate establishments.

In United States of America v Nolan, the Supreme Court ruled that the US Government did have collective redundancy consultation obligations with regard to civilian workers during the closure of a US army base in Hampshire.

The case arose after some 200 civilian employees were dismissed by way of redundancy following a decision by the Secretary of the US Army to close its base in Hythe. One of the employees, Christine Nolan, brought a claim on behalf of the redundant employees for compensation by way of a 'protective award' on the ground that the USA had failed to consult with representatives of the civilian workforce in accordance with its obligations under Section 188 of TULRCA.

Difficulties over when consultation should commence have arisen in the past because EU Directive 98/59/EC, the Collective Redundancies Directive, provides that an employer should begin consultations when 'contemplating' making collective redundancies, whereas this duty is given effect in domestic law as being a duty to consult when an employer 'proposes to dismiss' employees as redundant.

Mrs Nolan argued that the consultation period was far less than the 90-day period required and, in particular, that there had been a failure to consult before, and about, taking the operational decision to close the base. The USA did not at this stage seek to rely on state immunity or 'special circumstances' in order to defeat the claim, although it was common ground that it could have done so.

The Employment Tribunal found that no meaningful consultation over the closure of the base, and the redundancies this would involve, had taken place and awarded Mrs Nolan a 30-day protective award. The Employment Appeal Tribunal upheld this decision, relying on the decision in UK Coal Mining Limited v National Union of Mineworkers that where closure and dismissals are inextricably linked, a duty to consult over the reasons for the closure arises.

The USA appealed to the Court of Appeal on the ground that the more recent judgment of the Court of Justice of the European Union (CJEU) in a Swedish case (Akavan Erityisalojen Keskusliitto AEK ry and Others v Fujitsu Siemens Computers) is authority for the proposition that, on the true interpretation of the Directive, the consultation obligation is not triggered by a proposed business decision to close down a workplace but only arises at the later stage when the decision has been made and the intention to make the employees redundant has been formed.

The Court of Appeal sought guidance from the CJEU as to the precise point at which the obligation to consult arises under the Directive. However, the hoped-for clarification was not forthcoming. Although TULRCA does not exclude workers employed by public administrative bodies or by establishments governed by public law, the Directive expressly provides for them to be excluded from its scope. The CJEU held that the dismissal of staff at a military base did not fall within the scope of the Directive and declined to hear the case as it did not have jurisdiction to do so.

The case returned to the Court of Appeal, where the USA argued that since EU law did not require or intend a foreign state to be subject to the Directive's consultation obligations, TULRCA should be construed in the same way. The Court rejected this argument and made an order that there be a further hearing to decide on the UK Coal/Fujitsu issue.

The USA appealed to the Supreme Court, arguing that TULRCA should be interpreted in such a way as to accord due respect to its authority as a foreign state to make strategic decisions which are non-commercial in nature. The decision to close the base had been taken at a very high level in Washington, and the interpretation thus far favoured did not accord with principles of international law.

However, the Supreme Court found that the wording of the legislation was clear and that there was no reason to read into it a tailored exemption for a foreign power operating a base within the UK. The Court found that this was the case even though TULRCA goes beyond the requirements of the Directive it implements.

Arguments that the UK had breached international law by seeking to exercise legislative power outside its own territory were also rejected.
Because of the narrow basis of the appeal, the Supreme Court was unable to provide any assistance on the resolution, as a matter of domestic law, of the difficult UK Coal/Fujitsu issue.

The case will now return to the Court of Appeal for it to consider whether or not the US Government complied with its redundancy consultation obligations under domestic law.

It seems likely that resolution of the question as to precisely when the consultation obligation is triggered may take some time. In almost all other cases, the issue will depend on EU law. However, this case must be decided without guidance from the CJEU on this point.

A Guide to the Agency Workers Regulations

The Agency Workers Regulations 2010 (AWR) came into force on 1 October 2011. They apply to those workers who are supplied by a temporary work agency to work temporarily for and under the supervision and direction of a hirer.

All temporary agency workers are entitled, from the first day of their assignment, to information on any job vacancies and to make use of collective facilities and amenities available to comparable workers and employees. These may include staff canteens, childcare facilities, transport services (such as local pick-ups and drop-offs and transport between sites – but not company car allowances or season ticket loans), staff common rooms, prayer rooms and car parking.

Employers should ensure that temporary agency workers know how to access information relating to job vacancies and are aware of all relevant facilities. This can be done either by providing details directly to the worker, as part of an induction pack, or by providing details to the employment agency to pass on to the agency worker as part of the information on the assignment.

Agency Workers Who Have Completed a 12-Week Qualifying Period
Once a temporary agency worker has worked in the same job for the same hirer for a period of 12 calendar weeks, they are entitled to the same basic employment and working conditions as if they had been recruited directly by the employer.

Because the working patterns of temporary agency workers can be irregular, the AWR provide for a number of circumstances in which breaks do not prevent them from completing the qualifying period. Employers are therefore advised to study the rules for calculating this period in order to avoid errors.

Basic employment and working conditions include:

• basic pay;
• duration of working time;
• annual leave;
• night work; and
• rest breaks and rest periods.

The rights with regard to pay include:

• basic pay based on the annual salary the agency worker would have received if recruited directly – this will usually be converted into an hourly or daily rate, taking into account any pay increments the worker would have received;
• overtime payments – subject to the same requirements as if the worker had been recruited directly;
• payment for annual leave;
• bonus or commission payments linked to the amount and quality of work completed – e.g. achievement of sales targets;
• bonuses linked to personal performance or non-contractual payments that are made with such regularity that they are customary;
• vouchers or stamps which have a monetary value and can be exchanged for money, goods or services – e.g. luncheon vouchers, childcare vouchers but not salary sacrifice schemes; and
• paid time off for antenatal appointments.

Some payments may require those recruited directly to complete a period of service – e.g. enhanced entitlement to annual leave after 12 months. A temporary agency worker will need to complete the same period of service to become eligible. This should be calculated from the start of the 12-week qualifying period.

The rights with regard to pay do not include:

• occupational schemes – sick pay, maternity, paternity and adoption pay;
• redundancy and notice pay;
• payment for time off to carry out trade union duties;
• guarantee payments, as they apply to directly recruited staff if laid off;
• advances in pay – e.g. for season tickets;
• payments or rewards linked to financial participation schemes such as share ownership;
• the majority of benefits in kind – e.g. reduced-rate mortgages or employer-funded training allowances;
• bonuses where there is no recognition of a worker’s personal contribution, such as a flat rate bonus paid to the workforce to encourage loyalty or reward long service; and
• additional, non-contractual bonuses – as long as these payments are not made so often that they have become customary.

Temporary agency workers are covered by the automatic pension enrolment scheme. For further information, see the website of the Pensions Regulator.

To ensure equal treatment after 12 weeks’ service, employers who use temporary agency workers should have in place proper job descriptions and pay structures for the roles they perform. In addition, to facilitate calculation of the qualifying period, a record should be maintained showing the dates and hours worked, the location of their work and their job role. Employment agencies should be provided with information on the basic terms of comparable staff hired directly by the employer.

The AWR contain anti-avoidance provisions which prevent a series of assignments being structured so as to prevent a temporary agency worker from completing the qualifying period. Breaks between assignments will not, therefore, necessarily prevent agency workers from gaining the same basic employment and working conditions as staff recruited directly.

Detailed guidance on the AWR can be found on the website of the Department for Business, Innovation & Skills.

A Guide to Shared Parental Leave

Regulations that came into force on 1 December 2014 made changes to the way in which eligible parents can take leave after the birth or adoption of a child.

Shared parental leave (SPL) aims to introduce more flexible, more equal arrangements that will enable mothers to share up to 50 weeks' maternity leave and 37 weeks' pay with their partner so that both parents are able to keep a strong link to their workplace.

Qualifying employees have a legal right to choose to take SPL and to not suffer a detriment for using it or seeking to do so.

To be able to take SPL, parents must meet specific eligibility requirements. The mother or adopter must share the main responsibility for caring for the child with the child's father or the mother's partner and satisfy the 'continuity of employment test' – i.e. have worked for the same employer for at least 26 weeks at the end of the 15th week before the child’s expected due date/matching date and still be working for the employer at the start of each leave period. The child's biological father or the partner of the mother or adopter must have responsibility for caring for the child and meet the 'employment and earnings test' – i.e. must have worked for at least 26 weeks and earned an average of at least £30 a week (the maternity allowance threshold) in any 13 weeks in the 66 weeks leading up to the child's expected due date or matching date. In addition, parents must have properly notified their employer of their entitlement and have provided the necessary declarations and evidence.

The cut-off point for taking shared parental leave is 52 weeks following birth or adoption.

Under SPL, employed mothers are still entitled to 52 weeks' maternity leave as a 'day one' right. However, mothers can opt to end their maternity leave after the initial two-week compulsory maternity leave period – four weeks in the case of manual workers. Parents who are eligible can decide how they want to share the remaining leave and pay once the mother has decided to curtail her maternity/adoption leave. A mother can only share her leave with one person. The father or partner is still entitled to two weeks' ordinary paternity leave, paid at the flat rate of statutory maternity pay (SMP), but additional paternity leave and pay are no longer available.

If an employee is eligible for and intends to take SPL, they must provide their employer with a notice of entitlement to take SPL. This must contain specific information and be submitted at least eight weeks before the employee intends to take a period of SPL, in order to assist businesses in planning their workforce.

Parents can decide to take leave at the same time and/or take it in turns to have time off to look after the child. The number of notifications an employee is entitled to submit is capped at three (the original notification and two further notifications or changes) unless the employer allows them more.

Mothers who give notice to opt into SPL prior to giving birth can revoke the notice up to six weeks following the birth. This is in order to make sure that every mother is able to remain on maternity leave, should she choose to do so, once she has given birth. Otherwise, notice to end maternity/adoption leave is normally binding. However, the allocation of SPL can be varied between the parents at any stage, provided the employer is given details of the changes in writing. Any variation to leave that has already been booked will normally count as one of the three notifications.

SPL must be taken in complete weeks. An employee is entitled to take a continuous leave booking even if the employer does not respond to their notification. Each eligible employee is entitled to three such blocks of SPL. Where a request for discontinuous leave (e.g. a request to work one month in every two) is made, this can be refused by the employer but the entitlement to leave is not lost. Where discontinuous leave is requested and no agreement is reached with the employer, the employee may withdraw the request without it counting as one of their allowed three notifications to book leave, provided this is done within 15 calendar days of the original notification. If the employee does not withdraw their request, the discontinuous leave notification automatically defaults to a period of continuous leave. The employee can choose when this leave commences, provided this is done within 19 days of the original notification and the commencement date is no sooner than eight weeks from the date on which the original notification was given.

Under the new arrangements, there is a new statutory payment – shared parental pay (ShPP), payable at the flat rate of SMP – for parents taking SPL, with the same qualifying requirements that currently apply to SMP and paternity pay. If the mother or adopter gives notice to reduce their entitlement to maternity/adoption pay before they will have been in receipt of it for 39 weeks, any remaining weeks could become available as ShPP. An employee intending to claim ShPP must give their employer notice of how much ShPP both parents are entitled to, in what proportion and when each parent intends to take the paid leave and a declaration from their partner confirming their agreement to the employee claiming their amount of ShPP. The notice to claim ShPP can be included within the notice of entitlement to take SPL.

A notice of entitlement to take SPL or ShPP and the accompanying declarations is sufficient evidence of a right to claim SPL and ShPP. However, the employer can, within 14 calendar days of receiving the notice, request a copy of the child's birth certificate (if one is available). They can also request the contact details of the employee's partner's employer. If a request is made, the details must be provided within 14 calendar days.

If parents choose not to make use of SPL at first, they can opt to do so at a later date while they are still eligible, provided they give their employer eight weeks' notice and take the SPL within a year of the child's birth/adoption.

Under the new regime, the right to return to the same job for employees returning from any period of leave that includes maternity, paternity, adoption and shared parental leave that totals 26 weeks or less in aggregate is maintained, even if the leave is taken in discontinuous blocks. Any subsequent leave attracts the right to return to the same job or, if that is not reasonably practicable, a similar job.

In addition, the employee can agree with their employer up to 20 shared parental leave in touch (SPLIT) days to support them in returning to work. However, there is no obligation on an employer to offer these days or for an employee to agree to them. Parents can use these days to return to work on a part-time basis for a limited time.

Employers are also reminded that, since 1 October 2014, fathers/partners have a new right to take unpaid leave to attend two antenatal appointments.

Organisations that offer enhanced maternity rights, giving mothers maternity pay above the statutory minimum, may wish to 'mirror' these arrangements in their SPL policy. Whilst there is no statutory requirement to offer the same enhanced benefits to male employees, it is important that men and women are treated equally, receiving the same rate of pay in the same circumstances.

Businesses should have in place an SPL policy explaining the changes and the procedures and time limits for dealing with requests for leave under the new system.

Early discussions at the stage where an employee submits a notice to book SPL will avoid any confusion and enable employers to take steps to mitigate the effects of the employee's intended leave pattern on the business.

The Advisory, Conciliation and Arbitration Service (Acas) has produced guidance on SPL, including a good practice guide for employers and employees, together with sample policy/letter templates.

The Government has developed an online calculator to help prospective parents work out what their leave and pay entitlements under the new system are.

On 5 October 2015, the then Chancellor of the Exchequer announced the Government's intention to extend SPL and ShPP to working grandparents.

The planned changes, scheduled for implementation in 2018, recognised the role that grandparents play in providing childcare and support for working families and intended to increase flexibility and choice in parental leave arrangements.

Since then, the Prime Minister and the Chancellor of the Exchequer have changed and the UK has voted to leave the European Union. We await confirmation, therefore, as to whether this policy is to be pursued by the new administration.

E-cigarettes in the Workplace

Legislation under the Health Act 2006 that prohibits smoking in enclosed public places and workplaces, on public transport and in vehicles used for work does not cover the use of e-cigarettes. The devices do not burn tobacco or create smoke but work by vaporising a flavoured liquid for the user to inhale, which is why their use is referred to as 'vaping'.

While debate continues about the absolute level of safety of e-cigarettes, the consensus across England's public health community is that they are significantly safer for users than smoked tobacco. Nor is there any evidence so far of harm caused by second-hand e-cigarette vapour.

Approximately 2.8 million adults in Great Britain currently use e-cigarettes, almost all of whom are smokers or ex-smokers. Public Health England (PHE) has published guidance setting out the key principles that should guide policy making on the use of e-cigarettes in public places and in the workplace. The framework is aimed at helping employers create policies that will support smokers trying to give up the habit whilst managing any risks specific to their setting. Clearly, there is no 'one-size-fits-all' approach as working environments vary. For example, a factory or warehouse is a very different setting from a nursery school, so a different approach will be appropriate in each case.

The five key principles are:

1. Make clear the distinction between vaping and smoking;
2. Ensure policies are informed by the latest evidence on health risks to bystanders;
3. Identify and manage risks of uptake by children and young people;
4. Support smokers to stop smoking and stay smoke free;
5. Support compliance with smoke-free law and policies.

Under each heading, the guidance provides considerations to enable employers to produce a policy that is suited to their particular working environment.

PHE is committed to continuing to monitor the evidence on e-cigarette use and to communicating its findings so that members of the public and policy makers have the knowledge they need to make informed decisions.

A Guide to the Gender Pay Gap Reporting Regulations

The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 came into force on 6 April 2017, introducing mandatory gender pay gap reporting on an annual basis for private and voluntary sector employers with 250 or more employees.

Qualifying employers are required to compute and report on the difference in pay between 'relevant' male and female employees using data from a specific pay period that contains the relevant 'snapshot' date – which is 5 April – from 5 April 2017 onwards. Employers then have 12 months beginning with the relevant date in which to publish the information – i.e. the first report will be due no later than 4 April 2018.

Employers are required to disclose the following information:

• The difference between the mean hourly rate of pay of male full-pay relevant employees and female full-pay relevant employees;
• The difference between the median hourly rate of pay of male full-pay relevant employees and female full-pay relevant employees;
• The difference between the mean bonus pay of male relevant employees and female relevant employees;
• The proportion of male and female relevant employees who were paid bonus pay during the 12 months ending with the snapshot date of 5 April; and
• The relative proportions of male and female full-pay relevant employees in the lower, lower middle, upper middle and upper quartile pay bands.

When deciding whether or not the 250-employee threshold applies, employers should note that the Regulations use the definition of 'employee' as per Section 83 of the Equality Act 2010, whereby 'employment' includes employment under a contract of employment, a contract of apprenticeship or a contract personally to do work – i.e. workers. However, the employer is not required to include data for employees employed under a contract personally to do the work if they do not have, and it is not reasonably practicable for them to obtain, the relevant information. A 'relevant employee' is one who is employed on the snapshot date. Note, this now excludes partners in a firm (including in an LLP). Agency workers are to be included in the gender pay gap report of the agency with which they have a contract of employment.

The Regulations set out six steps to enable employers to calculate a relevant employee's hourly rate of pay and explain how to determine the number of working hours in a week. The calculations are based on the earnings of those employees in receipt of their 'ordinary' or 'full pay' on 5 April, not on actual pay as stated in the draft Regulations. Employees on reduced pay during the snapshot period are not included – for example a woman on maternity leave being paid less than her full salary.

For the purpose of the Regulations, 'bonus pay' means any remuneration that is in the form of money, vouchers, securities, securities options or interests in securities, or relates to profit sharing, productivity, performance, incentive or commission. It does not include ordinary pay, remuneration referable to overtime or remuneration referable to redundancy or termination of employment. The Regulations specify at what point bonus payments will be treated as paid to the employee, which is the point in time at which they would give rise to taxable earnings or taxable specific income.

Reporting on the relative proportions of male and female employees in each quartile pay band involves determining the hourly rate of pay for each male and female full-pay relevant employee, ranking them in order from the lowest paid to the highest paid, then dividing them into four groups containing an equal number of employees. Where there are employees paid the same hourly rate in more than one quartile pay band, the employer must ensure, as far as possible, that the relative proportion of male and female employees receiving that rate of pay is the same in each of those pay bands.

Where companies have a group structure, the reporting requirements apply to each separate legal entity within the group that has at least 250 employees, not the group as a whole.

The report must be submitted together with a statement signed by a director or partner, or by a member of the business's governing body or its most senior employee, confirming its accuracy. These must be published on the business's website, so that they are accessible to employees and the general public, and retained online for three years so that year-on-year comparisons can be made. In addition, employers must upload the same information to a government website – the Gender Pay Gap Viewing Service.

The initial intention was to 'name and shame' employers who fail to comply with their gender pay reporting duties and to keep the issue of penalties under review. However, the Explanatory Notes to the Regulations make clear that failure to comply with an obligation under them constitutes an 'unlawful act' within the meaning of Section 34 of the Equality Act 2006, which empowers the Equality and Human Rights Commission to take enforcement action.

The Advisory, Conciliation and Arbitration Service and the Government Equalities Office have published guidance and fact sheets on this topic to assist employers in complying with their gender pay gap reporting obligations.

The Secretary of State will carry out a review of the Regulations within five years and report on their effectiveness. This will include an assessment of whether or not the objectives of the legislation could be achieved with a system that imposes less regulation.

The Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 extend the requirement to report on the gender pay gap to public sector employers. The Regulations are being introduced as part of the existing public sector equality duty and the snapshot date for the collection of data is 31 March 2017. Public sector employers must therefore publish their first gender pay gap information no later than 30 March 2018.

Advice on Workplace Dress Codes

The Advisory, Conciliation and Arbitration Service (Acas) has guidance for employers who wish to impose dress standards in the workplace. This emphasises that employers should have sound business reasons for applying a particular dress code, such as requiring workers to wear a uniform to promote a corporate image.

The key points to bear in mind are:

• Dress codes must apply to both men and women equally, although they may have different requirements. For example, the policy may require women to wear 'business dress' whilst men 'must wear a tie';
• Reasonable adjustments must be made for disabled people when dress codes are in place;
• Employers must avoid unlawful discrimination in any dress code policy, such as banning the wearing of articles of clothing that manifest a worker's religious faith where this cannot be justified; and
• There may be health and safety reasons for having certain standards in place, for example insisting that those who work with food keep their hair tied back or covered, or banning the wearing of loose clothing by those who operate machinery.
• Acas recommends consulting with employees over the terms of the policy before its introduction. Once agreed, the policy should be written down and communicated to all staff members.

Employment Rights - Ministers of Religion

In President of the Methodist Conference v Preston, the Supreme Court ruled that a Methodist minister was not an employee of the Church and so could not pursue her claim for unfair dismissal.

For many years, it was accepted law that ministers of religion did not normally come within the definition of ‘employee’ for the purposes of the Employment Rights Act 1996 (ERA) because they were traditionally deemed to be ‘office holders’ working for God and the unique nature of their appointment to carry out essentially spiritual duties meant that they did not have a contract of employment because there was no intention to create legal relations.

Subsequent case law has changed this position, however, with the courts recognising that the employment arrangements between a church and its ministers should not lightly be assumed to deny ministers statutory protection in the event of a breach of those arrangements.

Hayley Preston became an ordained minister of the Methodist Church in 2003. In 2005, she was offered and accepted the position of superintendent minister in the Redruth circuit for a period of five years. When she subsequently brought a claim for unfair dismissal, the Employment Tribunal (ET) ruled that she could not proceed with her claim because she was not an employee. Ms Preston appealed against this decision.

The Employment Appeal Tribunal (EAT) overturned the ET’s decision. In doing so it referred to the 2005 decision of the House of Lords, in Percy v Board of National Mission of the Church of Scotland, that the relationship between a minister of religion and her church could be considered to be one of employment within the meaning of the Sex Discrimination Act 1975. As the claimant did not pursue her claim for unfair dismissal, the appeal did not consider whether or not she was an employee within the narrower definition under the ERA. However, the Law Lords had expressed the view that the employment status of ministers of religion needed clarification.

The Court of Appeal subsequently upheld the EAT’s decision, ruling that it was correct in law to find that the relationship between the Methodist Church and Ms Preston was contractual and that her contract was one of service. She was therefore an employee of the Church and entitled to bring a claim of unfair dismissal. The President of the Methodist Conference appealed against this decision and the appeal was upheld by the Supreme Court by a majority of 4:1.

In the Supreme Court’s view, the EAT and the Court of Appeal had ‘over-analysed’ the decision in Percy and paid insufficient attention to the Methodist Church’s Deed of Union and the standing orders which were the foundation of Ms Preston’s relationship with it. The primary considerations in such cases should be the manner in which a minister is engaged and the rules governing his or her service. The intentions of the parties concerned must be construed against their factual background, taking into account the rules and practices of the particular church and any special arrangements made with the particular minister.

The Court found that the manner in which a minister is engaged by the Methodist Church is incapable of being analysed in terms of contractual formation. The mere fact that the arrangement includes payment of a stipend, the provision of accommodation and recognised duties to be performed by the minister is not sufficient to lead to the conclusion that a minister is an employee. Furthermore, the disciplinary scheme applies equally to lay members of the Church and the relationship between a minister and the Church is not terminable except by the decision of the Conference or a disciplinary committee. There is no unilateral right to resign, even on notice.

The Court held that the ministry is a vocation by which candidates submit themselves to the discipline of the Church for life. No special arrangements existed in Ms Preston’s case and her rights and duties arose from her status in the constitution of the Church and not from any contract.

The appeal was therefore allowed and the order of the ET dismissing Ms Preston’s claim was restored.

A Guide to Selecting Employees for Redundancy

When an employer faces having to dismiss employees by reason of redundancy, there are certain procedures that should be followed in order to comply with the relevant law.

Redundancy is a potentially fair reason for dismissal, but it may be found to be unfair – for example if a particular employee is unfairly selected for redundancy. Where the decision to make someone redundant follows the reasonable application of a fair process, however, it will not normally be open to question.

When selecting employees for redundancy, employers should, wherever possible, try to use objective criteria that are precisely defined and capable of being applied in an independent way.

In an ideal world, the business’s written procedures will contain details of agreed redundancy selection criteria to be used in such circumstances. Where this is the case, the employer should follow the established procedure unless there is a very good reason for not doing so.

Proper consultation is the key to a fair process. Where there is a recognised trade union, the employer will consult the union, before any action is taken, as to the best way to achieve the desired result. This will include agreeing the criteria to be applied in selecting the employees to be made redundant. When the selection has been made, the employer will again consult with the union to confirm that decisions have been made in accordance with those criteria. Where there is no recognised trade union, it is best practice to agree with managers, employees and their representatives, in advance of the redundancy process, the criteria to be used at each stage. There should also be an appeals procedure which is clearly communicated to the employees concerned.

Once ways to minimise or avoid compulsory redundancies have been exhausted, the next step is to define the pool of employees from which redundancies will be made.

Defining the Pool of Employees
In dealing with unfair dismissal claims that challenge the fairness of an employer’s decisions with regard to the composition of the redundancy selection pool, an Employment Tribunal will ask whether the employer acted reasonably in selecting those particular employees taking into account the actual position at the time of redundancy.

Although specific jobs may be being lost, the pool should not be confined to those currently occupying those jobs but should include all employees capable of doing that work – i.e. those undertaking the same or similar roles. This will normally include employees carrying out the same kind of jobs in other parts of the business and those who work a different shift pattern. In some cases, it will also include those working at other sites. This will depend on the terms of the employees’ contracts of employment and their past working patterns.

Limiting the chosen pool to employees on part-time or fixed-term contracts may be potentially discriminatory if more women than men are employed on such terms.

There is no need to select a pool or undertake a formal redundancy selection process when the entire business is shutting down and there are no other sites to take into consideration. There will also be cases where the redundant post is unique and it is therefore reasonable for the employer to focus on a single employee without developing, or even considering the development of, a redundancy pool.

The law recognises that different people can quite legitimately have different views as to what is or is not a fair response to a particular situation. Employers do, therefore, have a broad measure of flexibility in determining the selection pool for redundancy. Merely identifying factors an employer has not taken into account will not of itself justify the conclusion that the decision reached was unreasonable. Any such finding must be based on a ‘sound rationale’.

Selecting From the Pool of Employees
The following criteria can be used when selecting employees for redundancy:

• Skills and experience;
• Attendance and disciplinary records;
• Standard of work performance; and
• Aptitude for work.

Care must be taken at every step to ensure that the chosen criteria are assessed objectively and applied fairly and consistently. The assessment should be carried out by someone with direct knowledge of the employees’ work and written records of the process kept.

Be careful of using terms that are hard to quantify and therefore more likely to be subjective. For example, assessing employees according to their ‘flexibility’ could discriminate against disabled employees or women relying on childcare arrangements to enable them to work. Likewise, care must be taken to avoid claims of disability discrimination when assessing sickness absence or performance.

‘Performance’ data should be supported by (at least) annual performance appraisals to ensure that any assessment made is based on objective evidence.

For a dismissal to be fair, it is necessary that an employee can be provided with sufficient information in order to be able to challenge his or her selection for redundancy.

In the past, employers have sometimes adopted a ‘last in, first out’ approach. However, this could mean that only young people are selected for redundancy, which would lay the employer open to a claim for age discrimination.

The criteria used should be appropriate in the circumstances and this will often depend on the size of the business. There is no requirement that they can only be valid if they can be scored or assessed in a ‘box-ticking’ exercise. The criteria are bound to involve a degree of judgment, but this does not mean that they cannot be assessed in an objective way.

It is important to select criteria that will help maintain a workforce that can best support the future needs of the business, so making sure the necessary skills and experience are retained is crucial. As the reduction in work which causes the redundancy dismissals need not relate to the actual work carried out by the dismissed employees, there may be occasions when an employee whose job is redundant ‘bumps’ another employee out of their job and the latter is made redundant instead. This most often happens when a more senior employee is willing to accept a more junior role in order to avoid redundancy.

Employers are reminded that where an employer is proposing to dismiss as redundant 20 or more employees within a period of 90 days or less, specific procedures for handling collective redundancies come into play.

Pregnant Employees and Those on Maternity Leave
Selecting a woman for redundancy because of her pregnancy, maternity leave or a related reason is automatically unfair dismissal as well as being unlawful discrimination. Failure to consult a woman on maternity leave about possible redundancy is likely to be unlawful discrimination.

Regulation 10 of the Maternity and Parental Leave etc. Regulations 1999 entitles a woman on maternity leave whose job comes to an end by reason of redundancy to be offered alternative employment with her employer, before her existing contract ends, where there is a suitable vacancy. The new contract must be for work appropriate for the employee and on terms and conditions that are not substantially less favourable than if she had continued to be employed under her previous contract. An employer's failure to comply with Regulation 10 renders any subsequent dismissal automatically unfair under the Employment Rights Act 1996.

The Advisory, Conciliation and Arbitration Service (ACAS), in partnership with the Equality and Human Rights Commission, has published guidance, 'Managing redundancy for pregnant employees or those on maternity leave', to help employers understand the rights of women who are pregnant or on maternity leave when workplace redundancies are necessary.

The manner in which the redundancy process is conducted is important. To avoid problems, contact us for advice before you take any action.

Constructive Dismissal and Affirmation of Contract

Constructive dismissal occurs when an employee is forced to leave their job against their will because of a fundamental breach of contract by their employer. In order to succeed in a claim for constructive dismissal, the employee must show that they have not acted in a way that suggests that they have accepted the breach, which is referred to in legal parlance as 'affirmation of contract'.

In Chindove v William Morrison Supermarkets plc, the Employment Appeal Tribunal (EAT) has given guidance on the factors the Employment Tribunal (ET) should take into account when deciding whether or not an employee has, by their actions, affirmed their contract of employment following a breach.

Mr Chindove was employed by Morrisons as a warehouse operative from 2003 until he resigned in October 2011. Following his resignation, he brought claims of constructive dismissal and race discrimination on the ground that complaints he made after two separate incidents of racial discrimination and harassment against him by a fellow worker were not pursued to a satisfactory conclusion by his employer.

Although the ET said that each incident had amounted to a fundamental breach of Mr Chindove's contract by his employer, it found that Mr Chindove had affirmed the contract because it was some six weeks after the last act of mistreatment that he decided to resign.

The EAT overturned the ET's decision. In its view, passage of time viewed in isolation is not sufficient for the employee to lose the right to treat himself as dismissed. The principle is whether the employee has demonstrated by his conduct that he has decided to affirm the contract. This could be by what he has done or what he has communicated to show that he intends the contract to continue. Whilst continuing to work after the breach is indicative that the employee does not intend to exercise the right to treat himself as discharged, it depends on the context and not on any strict time test. Factors to be taken into account would include how easy it would be for the employee to find alternative work and whether or not the employee was actually at work and so seen to be continuing to honour their contract. Where an employee is sick and not working, 'that observation has nothing like the same force'.

In this case, Mr Chindove was off sick during the time in question and, for someone who has worked for their employer for eight or nine years, six weeks is a very short time in which to infer from their conduct that they have decided not to exercise their right to resign.

The case was referred to a fresh ET to determine whether, by his conduct, Mr Chindove had affirmed his contract of employment as continuing and had therefore lost the right to treat himself as constructively dismissed.

Graduate Recruitment

Most businesses would like to benefit from an influx of talent, enthusiasm and fresh ideas. The challenge is to achieve it at an acceptable cost.

One option is to employ a recent graduate. In the past, most graduate recruitment was undertaken by large companies. These days, businesses of all sizes are taking advantage of the opportunity. This briefing is primarily aimed at smaller businesses.

It covers:

• The pros and cons of employing a recent graduate.
• Deciding on the sort of graduate you want, and coming up with an offer.
• Recruiting a graduate.
• Retaining your graduate.

A Guide to Equal Pay Audits

Under the Equality Act 2010, it is unlawful for an employer to discriminate between men and women in terms of their pay and conditions where they are in the same employment and are doing the same or similar work, work rated as equivalent or work of equal value. An employer only has a defence against a claim of sex discrimination with regard to pay where the difference in contractual terms is due to a 'material factor' which is not directly or indirectly discriminatory.

The Equality Act 2010 (Equal Pay Audits) Regulations 2014 set out the circumstances in which the ET must order an employer found to have breached the equal pay provisions of the Equality Act to carry out an equal pay audit, the required contents of the audit and the timetable for ensuring compliance with the order.

The Regulations set out the circumstances in which the ET must order the employer to carry out an equal pay audit, the required contents of the audit and the timetable for ensuring compliance with the order.

Employers will not be ordered to carry out an audit where the ET considers that:

• an audit has been completed in the previous three years that meets the requirements as to the content of an equal pay audit;
• it is clear without an audit being done whether any action is required to avoid equal pay breaches occurring or continuing;
• the breach in question gives no reason to think that there may be other breaches; or
• the disadvantages of an audit would outweigh its benefits.

There is also an exemption for existing micro-businesses (i.e. those with fewer than ten employees) and new businesses (i.e. brand new businesses started in the twelve-month period before the complaint was made).

Where an order is made, this will include a description of the persons for whom relevant gender pay information must be included, the period of time covered by the audit and the date on which the audit must be received by the ET.

An audit must:

• include the relevant gender pay information as specified by the ET;
• identify any differences in pay between the men and women specified and the reasons for those differences;
• include the reasons for any potential equal pay breach identified by the audit; and
• include the employer's plan to prevent equal pay breaches occurring or continuing.

Once the audit has been satisfactorily completed, the gender pay information it contains will normally be required to be published 'in a format accessible to all affected staff', which will usually be on the employer's website, for a period of at least three years.

Failure to comply with an order may result in a penalty not exceeding £5,000, with possible additional penalties for employers who continually fail to comply with an order.

Whilst the Equality Act requires public sector organisations to consider gender equality within their workplace as part of the Equality Duty and to publish relevant gender equality data, there had hitherto been no requirement for employers in the private and voluntary sectors to do so. However, the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, which came into force on 6 April 2017, introduce mandatory gender pay gap reporting on an annual basis for private and voluntary sector employers with 250 or more employees. The first report will be due no later than 4 April 2018.

In addition, the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 have extended to public sector employers the requirement to produce annual statistics on the gender pay gap in a prescribed format. These Regulations are introduced as part of the existing public sector equality duty and the first report will be due no later than 30 March 2018.

Failing to Prevent Bribery - Are You at Risk?

The Bribery Act 2010 came into force on 1 July 2011. It created a new offence which can be committed by a commercial organisation if it fails to prevent persons associated with it from committing bribery on its behalf. A business can provide a defence by showing that it had ‘adequate procedures’ to prevent bribery by such persons from taking place, however. Organisations that have not already done so should ensure they have the necessary prevention procedures in place.

What is deemed to be adequate will depend on the nature, size and complexity of your business. The key point is that to rely on the defence, the measures you adopt must be proportionate in view of the likelihood of bribery occurring – for example, a large firm which operates in overseas markets is likely to be more at risk than a small organisation undertaking business primarily in the UK. You should therefore carry out a risk assessment of the potential that exists for bribery offences to be committed, especially when entering into new business arrangements and new overseas markets.

Where appropriate, due diligence should be carried out so that you know exactly whom you are dealing with, especially when engaging others to represent you in business dealings.

Whatever anti-bribery procedures you do decide are necessary should be seen to have the backing of those at the top of the organisation and the policy should be communicated to staff and others who will perform services for you, with training provided where appropriate, so that it is clear that the business culture is one in which bribery is not tolerated. If the risks you face change, your procedures may cease to be effective, so it is important to make sure these are kept up to date.

Concern has been expressed that spending on hospitality could cause a business to fall foul of the Bribery Act. The position is that you can continue to provide bona fide hospitality and spend money on promotional or other business initiatives provided the expenditure is reasonable and proportionate given the sort of business you are engaged in. The expenditure should be made in order to promote your products or services, improve the image of your business or establish good relations with clients, with no intention of corrupting the independence of the recipient.

The Serious Fraud Office has advised that when considering whether expenditure on corporate hospitality can be considered to be a bribe, it will look at five factors:

1. Whether or not the organisation has issued a clear policy regarding gifts and hospitality;
2. Whether the expenditure in question was compliant with the policy and, if not, whether or not it had been sanctioned at the appropriate level within the organisation;
3. Whether or not the expenditure was proportionate with regard to the status of the recipient;
4. Whether or not the expenditure had been entered in the organisation’s books of account; and
5. The lawfulness of the receipt by the recipient under the laws of his or her own country.

Where an offence under the Act is committed with the consent or connivance of a senior officer of an organisation, that person (as well as the body corporate or partnership) is guilty of the offence and liable to be proceeded against and punished accordingly. The maximum penalty for individuals is 10 years’ imprisonment or an unlimited fine, or both. The maximum penalty for commercial organisations is an unlimited fine.

The Ministry of Justice has published guidance on the Act, including case studies illustrating what approach businesses might take in certain situations.

Employees' Right to Request Flexible Working Arrangements

Since 30 June 2014, all employees have had the right to ask their employer for a change to their contractual terms and conditions of employment so that they can work flexibly, provided they have worked for their employer for 26 weeks continuously by the date on which the application is made. Previously, the right only applied to the parents of children under 17 (or 18 in the case of parents of disabled children) or to those with caring responsibilities for an adult.

As of that date, the statutory procedure for considering requests was removed and replaced by an Advisory, Conciliation and Arbitration Service (Acas) Code of Practice containing guidance on an employer's duty to consider all requests in a reasonable manner and to reach a decision within three months (unless an extension is agreed). However, employers have the flexibility to refuse a request on business grounds, provided it is for one or more of the eight reasons for so doing specified in the Employment Rights Act 1996.

If an application for flexible working is made, the employer should consider it carefully, looking at the benefits of the requested changes in working conditions for the employee and the business and weighing these against any adverse impact on the business in terms of the possible costs or logistical implications of granting the request.

In reaching a decision, employers must be careful not to inadvertently discriminate against particular employees because of their protected characteristics, thus exposing themselves to a claim under the Equality Act 2010, for example by failing to agree to flexible working arrangements where this would be a reasonable adjustment for a disabled employee.

In addition, an employer must ensure that part-time workers are treated consistently with other workers as the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 make it unlawful to treat part-time workers less favourably as regards their contractual terms and conditions than comparable full-time workers, unless the different treatment can be justified on objective grounds.

It is important to remember that where an employee's request for flexible working arrangements is granted, the variation to their contract of employment is binding, unless both parties subsequently agree otherwise.

Employers are advised to have in place a policy for handling requests for flexible working arrangements as this can help to ensure consistency of treatment across the workforce.

The Code of Practice and revised Acas guidance on the right to request flexible working can be found on the Acas website.

Employee Rest Breaks

Employers Must Be Proactive to Ensure Workers Get Proper Breaks

Except in certain circumstances, an adult worker whose daily working time is more than six hours is entitled to a 20-minute uninterrupted rest break as laid down by Regulation 12(1) of the Working Time Regulations 1998 (WTR). In an important test case concerning a bus driver who claimed to have been forced to work eight-hour shifts without a break, the Employment Appeal Tribunal (EAT) has ruled that employers are required to take a proactive approach to compliance with this entitlement (Grange v Abellio London Limited).

Prior to July 2012, Mr Grange's working day was fixed at eight and a half hours on the basis that he would enjoy a half-hour unpaid lunch break. However, the nature of his work made it difficult in practice for him to take such breaks. On 16 July 2012, he received an email from his employer, Abellio London Limited, expressing its expectation (at best) or instruction (at worst) that in future he was to work an eight-hour shift, without the half-hour break, but then to leave work half an hour earlier than he had done previously. In July 2014, he raised a grievance on the ground that he had been forced to work without a break and this had contributed to a decline in his health, but this was rejected.

Mr Grange subsequently complained to an Employment Tribunal (ET) that Abellio had denied him his entitlement to a 20-minute uninterrupted rest break, as provided by Regulation 12(1) of the WTR.

In dismissing his claim, however, the ET followed the approach taken by the EAT in Miles v Linkage Community Trust Limited and found that Abellio had not actually refused a request by Mr Grange to allow him to exercise his right to a rest break. The first time that he had complained about not being afforded breaks was when he lodged the formal grievance that his health had been affected by being forced to work non-stop for eight hours and there was no evidence that his employer had, in fact, refused his request.

In upholding Mr Grange's challenge to that decision, the EAT noted that there was conflicting legal authority as to whether there had to be an active refusal by an employer to allow breaks in order to give rise to liability under the WTR.

As the WTR were introduced in order to implement the EU Working Time Directive (WTD), it was appropriate to consider the language and purpose of the WTD, whereby rest periods are considered to be essential for the protection of workers' health and safety. Adopting that approach, it was clear that the construction of the WTR allowed by the EAT in Scottish Ambulance Service v Truslove was to be preferred to the approach taken in Miles.

The EAT therefore held that the WTR impose a duty on employers to actively respect workers' rights to rest breaks. They are required not merely to permit such breaks but to proactively ensure that working arrangements allow for workers to take them.

Appropriate Alternative Arrangements

There are exceptions to this general rule regarding rest breaks in order to take account of unusual or particular working arrangements where strict compliance would cause operational difficulties, for example in the case of workers who are ‘engaged in security and surveillance activities requiring a permanent presence’. Where the exception applies, the employer should nevertheless allow the worker to take an ‘equivalent period of compensatory rest’ wherever possible (Regulation 24(a)). In exceptional cases in which there are objective reasons for this not being possible, the employer must provide such protection as is appropriate in order to safeguard the worker’s health and safety (Regulation 24(b)).

In Hughes v The Corps of Commissionaires Management Limited, a security guard claimed that the arrangements made by his employer with regard to rest breaks during his shift did not comply with its obligations under the WTR.

Mr Hughes’ duties required him to be continuously available to supervise and monitor access to a site in Croydon owned by the telecommunications company Orange. He therefore remained on call during his rest breaks, leaving a note of his contact number on the reception desk. Sometimes, he was able to have an uninterrupted break, although he could never be sure in advance that this would be the case. If interrupted, however, he was permitted to start his break again.

The Court of Appeal held that whereas in normal cases a rest break must be outside working time altogether, in cases where an equivalent period of compensatory rest is offered, this need not be the case. It must, however, ‘have the characteristics of a rest in the sense of a break from work’ and the employer must, as far as is possible, ensure that the period that is free from work is of at least 20 minutes. The Court was satisfied that the nature of Mr Hughes’ job meant that he fell within the exceptions for the purposes of the WTR and the breaks provided to him did equate to an ‘equivalent period of compensatory rest’ under Regulation 24(a). Indeed, since he was permitted to restart any break which had been interrupted, he would sometimes enjoy a longer break than the 20 minutes normally required by the WTR.

In case it was wrong in its judgment that the arrangements in this case fell under Regulation 24(a), the Court went on to consider them under Regulation 24(b). This does not set two hurdles – exceptional circumstances and objective reasons why an equivalent period of compensatory rest cannot be provided. The presence of the latter establishes the former. Cases where the employer can provide neither a normal rest break nor a compensatory rest break will perforce be exceptional. Furthermore, the Court rejected Mr Hughes’ argument that his employer could not satisfy the Regulation unless it had carried out an assessment of the risks arising when there is a possibility of a rest break being interrupted. There is nothing in the legislation that requires this.

The Court of Appeal therefore held that there was no contravention of the WTR in this case.

Early Conciliation - How Does it Work?

For Employment Tribunal (ET) claims lodged on or after 6 May 2014, it is a legal requirement, unless an exemption applies, for the claimant to first notify the Advisory, Conciliation and Arbitration Service (Acas) by completing an Early Conciliation notification form. ET claims will not be accepted unless this procedure has been followed and a formal Early Conciliation certificate has been issued.

Taking part in Early Conciliation is, however, voluntary. A potential claimant is under no obligation to try to resolve the dispute via this method, nor is an employer under any obligation to participate where the claimant does wish to conciliate. In addition, either the claimant or the employer can stop the process at any time.

The easiest method of complying with the requirement is for the prospective claimant to complete the Early Conciliation Notification form on the Acas website. Those unable to access the Internet can submit the form in the post. Information on postal applications can be obtained by telephoning 0300 123 1122. The notification form must contain the prospective claimant's name and address and the prospective respondent's name and address but does not ask for any details of the dispute.

Acas will then acknowledge receipt of the notification and a support officer will attempt to contact the claimant by telephone by the end of the following working day to explain the service and to find out more about the potential claim. The employer will only be contacted if the claimant decides that they do wish to proceed with Early Conciliation, in which case the case will be passed to an Acas conciliator who will aim to contact both parties by the close of the next working day.

If Acas is unable to contact the parties over a reasonable period of time, or the claimant decides that they do not wish to try to settle the matter through Early Conciliation, the case will be closed and an Early Conciliation certificate will be issued. This will include a unique reference number which must be used if the claimant decides to proceed with an ET claim.

Where the Early Conciliation service is used, conciliation is intended to take place during one calendar month, but this can be extended by a further 14 days if both parties agree that more time is needed and Acas believes that the claim is close to settlement. If, at the end of this period, the matter has not been resolved, the case will be closed and a certificate issued.

The Early Conciliation scheme is free and completely confidential. Statements made during the course of the attempted conciliation cannot be used by either party if the process fails and a claim is presented to the ET.

Conciliation will normally take place over the telephone, but a meeting chaired by the conciliator will be suggested where appropriate.

If the dispute is resolved by means of Early Conciliation, the conciliator will record the terms of the agreement on form COT3. This will then be signed by both parties and will form a legally binding contract.

Because the introduction of Early Conciliation impacts on ET time limits, the rules regarding these have been changed accordingly. When a potential claimant notifies Acas under the scheme, this will 'stop the clock' for the time limit that applies for presenting the claim to the ET. The maximum pause is therefore one month, or one month plus 14 days for claims where an extension is agreed. If Acas concludes that settlement is not possible, the pause on the limitation period will end on the day that the prospective claimant receives the Early Conciliation certificate.

An employer who believes that a workplace dispute could result in ET proceedings can also make a request for pre-claim conciliation. However,
unlike an individual making a request, for employers there is no specified time within which the conciliation must take place and there is no extension to the limitation period for submitting a claim.

For more information on Early Conciliation, see the Acas website.

Between April 2015 and March 2016, ACAS dealt with 92,000 early conciliation cases, an increase of around 1,000 compared with the previous year. Of these 31 per cent were settled at the early conciliation stage and 22 per cent were settled at the post-claim stage.

Acas produces regular reports on the number of claims handled and their outcomes.

Driving on Company Business

Research by the Health and Safety Executive shows that 20 people are killed and 250 are seriously injured each week in traffic accidents involving someone driving for business reasons.

The threat of employers being prosecuted for road accidents involving their employees is now more likely as official records are kept of work-related road crashes. Paperwork completed by investigating police officers when logging details of road accidents now includes a section on whether the drivers involved were travelling on company business.

In addition, the Metropolitan Police and several other forces have adopted a policy of investigating company road-safety policies when an accident involving a work vehicle occurs.

Police will investigate whether the company has carried out basic checks, such as making sure employees using their own cars for business purposes have a valid driving licence, are insured to drive on business and have an MOT certificate for their vehicle. In addition, they intend to investigate the reasons for a vehicle involved in an accident being on the road.

Businesses could face prosecution if, for example, one of their drivers who was found to be at fault for an accident did not have adequate insurance cover.

Not all mobile workers are covered by the EU drivers’ hours rules. Many company car drivers cover a lot of miles so it is important to introduce safe driving policies to protect them and other road users. Employers should assess occupational road risk in the same way as they would other workplace risks to health and safety and manage the risks involved. Thought should be given to the choice of vehicle, and working practices, journey schedules, appointments and routes must be organised so that drivers do not break the law.

In addition, it is an offence to cause or permit a driver to use a hand-held phone while driving so the use of hand-held mobile phones should be banned and breach of this rule made a disciplinary offence. Employers should also think twice before supplying staff with hands-free kits. Even though the use of these while driving does not contravene the specific ban on hand-held phones, motorists can face prison if they cause a fatal accident as a result of being avoidably distracted at the wheel.

Section 20 of the Road Safety Act 2006 contains an offence of causing death by careless or inconsiderate driving, which covers distractions that can lead to accidents and carries a maximum penalty of five years’ imprisonment. A distraction can be anything which takes a driver’s attention away from the road and which a court rules to have been an avoidable distraction. The definition includes smoking whilst driving, using a mobile phone (whether hands-free or not), listening to music, talking to fellow passengers, drinking, eating, using technological aids and personal grooming.

Employers with employees who drive on company business are strongly advised to make them aware of the applicable law and to ensure that their road safety policies include a warning not to contravene the latest Highway Code.

The Driver and Vehicle Licensing Agency has a service whereby an employer can check someone’s driving licence information – e.g. the vehicles they are eligible to drive and whether they have incurred any penalty points or are currently disqualified from driving. In order to carry out the check, the employer will need:

• the last 8 characters of the person's driving licence number; and
• a check code from the driver.

The code is only valid for 21 days and can only be used once.

Further information on ensuring someone you employ to drive has the right licence and qualifications can be found on the GOV.UK website.

Dealing with Employee Absence

Employee absences can be both costly and disruptive for businesses.

According to the Chartered Institute of Personnel and Development's 2016 annual survey report on Absence Management, on average people were absent from work for 6.3 days in the year, compared with 6.9 days per employee in 2015. However, absence rates vary considerably within and between different sectors.

Stress was the most common cause of long-term absence, and the second most common cause of short-term absence – after minor illness. Workload, non-work factors and management style were again reported as the top three causes of stress at work. In addition, a quarter of the organisations surveyed reported that non-genuine absence was one of their top five causes of short-term absence.

More organisations are recognising the important part line managers play by giving them primary responsibility for managing employee absence. However, this awareness was not matched by support by way of initial training or tailored ongoing support for the role.

Overall, the survey findings suggest that addressing long hours' cultures and an increased focus on workers' well-being are among the steps employers need to take if they are to reduce employee absence.

Clearly, it is advisable to have systems in place to measure and analyse these costs so that you can identify problem areas and tackle the possible causes. Are there patterns of absence? Does a particular department have a below average record?

Unhappy, demoralised employees are more likely to take time off work. Workplace stress is a common cause of long-term sickness among non-manual workers. Creating a friendly working environment, where staff feel valued as part of a team and where flexible, ‘family friendly’ policies are in force is likely to pay dividends, keeping absenteeism to a minimum.

To manage absence effectively, make sure staff are well informed as to your sickness policy and procedures. Make sure these are seen to be followed and keep accurate records. These must be kept for at least three years after the appropriate financial year-end.

Where line managers are primarily responsible for overseeing employee absence, make sure they are trained in all aspects of absence-handling and have ongoing support, such as online support or a care conference with the Human Resources department, so that they are able to handle what can be difficult conversations with staff in a sensitive manner.

When hiring new staff, make sure you check their attendance record with the previous employer. If new staff are absent it is good practice to make sure you know if there are problems preventing them from settling in. How staff are treated in the first weeks of a new job is vital. Inadequate training can leave them feeling disillusioned.

It is sensible for employers to ensure that contracts of employment allow them the right to get an independent medical assessment in the event of an employee taking more than a few days off work. You may consider requiring all potential employees to undergo a medical examination with an occupational health adviser.

As a matter of company policy always carry out a ‘return to work’ interview. This may range from ‘hope you’re better, we missed your contribution’, to an identification of underlying problems that will affect your management strategy. It may also deter malingerers.

Long-term sickness must be handled sensitively. You must have an employee’s permission to apply for a medical report. It is vital to keep in touch so that the employee doesn’t feel isolated. Consider referring them to an occupational health specialist. This can identify ways of helping them return to work and give you information as to how long the absence is likely to last.

Disciplinary action for unacceptable absence must be distinguished from dismissal on health grounds. Employers need to be aware of the full range of conditions that count as a disability for the purposes of the Equality Act 2010. Where an employee is suffering from a condition covered by the Act, reasonable adjustments must be made to help them return to work. Care must also be taken to avoid a claim for unfavourable treatment 'because of something arising in consequence' of an employee's disability.

As regards the accrual of holiday pay when a worker is on long-term sick leave, workers have the right to carry forward four weeks of their statutory holiday entitlement to the next leave year if they are unable to take it or choose not to do so in the current year owing to long-term illness. However, the leave, or the right to payment in lieu of that leave, will be lost if it is not taken within 18 months of the end of the relevant year in which the entitlement to that leave accrued.

Dealing with long-term absences, in particular, is a difficult area of the law. Each case must be decided on its own merits and proper procedures must be followed. Employers who have not done so for a while are advised to review stress management and long-term absence policies and procedures so that potential problems are identified early on and remedial action is taken as soon as possible.

Fit for Work

Employers are reminded that, since 8 September 2015, employers have been able, with the employee's consent, to make a direct referral to the Fit for Work service, without the need to go via the individual employee's GP.

The aim of the Fit for Work service is to improve the management of sickness absence by helping employees return to work after a period of sick leave.

The service is free and offers occupational health advice and support for people who are in employment. Employees are eligible if they have been off work for four weeks or more owing to sickness and have a realistic prospect of returning to work. For further information and the online form for commencing a referral, see the Fit for Work website.

Homeworking and an Employer's Duties

Since 30 June 2014, all employees who have worked for their employer continuously for 26 weeks have the right to ask their employer if they can work flexibly. For many people, more flexible working arrangements could include carrying out some or all of their work at home.

According to analysis published by the TUC, the number of employees who regularly work from home increased by 19 per cent, to 1,521,000, in the ten-year period from 2005 to 2015 and Government research shows that a further four million workers would welcome the chance to do at least some of their work from home. Whilst there are many jobs that cannot be carried out anywhere other than in the workplace, many roles are suitable for homeworking, and such arrangements can be beneficial to a business in terms of cost savings and staff morale.

Establishing a Homeworking Policy

Where homeworking arrangements are practical, in order to ensure consistency employers should establish a policy, agreed in advance with employees and, where they exist, their representatives, setting out the assessment criteria, all necessary arrangements and how homeworkers will be managed.

Contracts of Employment

When an existing employee becomes a homeworker, this will constitute a variation in the terms of their employment contract. It is preferable for any agreed changes to be recorded in writing. As a change in job location is a change to the information which must be included in an employee's written statement of employment particulars, the employer should give written notification of the change to the employee, within a month of the change taking effect.

Risk Assessments

Under the Health and Safety at Work etc. Act 1974, employers have a duty to protect the health, safety and welfare of their employees, including those who work from home. In addition, the Management of Health and Safety at Work Regulations 1999 require employers to carry out a risk assessment to identify any hazards relating to the work done by homeworkers and to take steps to remove them or, where this is not reasonably practicable, to minimise them. Checks should include whether the ventilation, temperature, lighting, floor, space, chair, desk or workstation and computer are suitable for the tasks being performed. Employers are responsible for any equipment they provide. Any problems identified in the home itself should be rectified by the employee before homeworking commences. A record must be kept of the findings of the risk assessment and the risks kept under review. The employee is responsible for maintaining a safe environment and must inform their employer if any measures taken turn out to be ineffective.

The Health and Safety Executive has a leaflet for employers on where to find useful guidance on health and safety issues as regards homeworkers, depending on the level of risk involved in the type of work being performed.

Equipment

Employers who provide equipment to enable homeworkers to do their job have a duty to make sure that it is both suitable and safe and that its condition is maintained. The effectiveness of home technology is vital to the success of the arrangement, so prompt action in the event of a breakdown in equipment or communications is essential. Where display screen equipment is used, the employer must make sure that it is safe and does not adversely affect the user's health. Employers also have a duty to ensure the provision of appropriate eye and eyesight tests, on request, for all workers who regularly work with display screen equipment.

New and Expectant Mothers

New or expectant mothers are owed a special duty of care under the Management of Health and Safety at Work Regulations. Particular attention must therefore be paid when women of childbearing age are employed. The risk assessment must include risks specific to new and expectant mothers. This is irrespective of whether an employer knows that they have new or expectant mothers working for them.

First Aid

The employer must supply adequate first aid provision for homeworkers. This will depend on the nature of their work and the risks involved.

Insurance

Check that you have appropriate insurance cover for employees who work from home, including statutory employer's liability insurance and insurance covering any equipment or materials provided.

Equality Issues

It is important to treat employees fairly and consistently, whether they work at home or in the workplace. For example, homeworkers should have exactly the same opportunities for training, development and promotion as workplace-based members of staff.

When considering an employee's request to work from home, employers must take care not to discriminate against someone who has a protected characteristic under the Equality Act 2010. The application of a provision, criterion or practice that puts a person with a protected characteristic at a disadvantage compared with others can lead to a claim of indirect discrimination. In addition, it is important to make any reasonable adjustments for disabled staff who are going to work from home. In some cases, allowing a disabled member of staff to work from home will itself constitute a reasonable adjustment.

Security

Employers should make sure that policies on information management and data protection are understood and followed by homeworkers.

Employee Representatives

Employee or trade union representatives need to communicate with employees who work from home. Employers should take reasonable steps to facilitate this – for example by providing a meeting room in the workplace.

Isolation

One problem that can arise when people work from home is that they feel cut off from other members of staff. Employers must beware of adopting an 'out of sight, out of mind' attitude in the case of homeworkers. Maintaining effective channels of communication is important. It is also good practice for homeworkers to attend regular review meetings in the office. The frequency of these will depend on the type of work being performed and the demands of the business.

The Advisory, Conciliation and Arbitration Service has useful guidance on this topic, 'Homeworking – A Guide for Employers and Employees'. This contains a number of case studies and a useful checklist designed for use when setting up homeworking and when carrying out ongoing checks on the arrangements in place.

Drug Policy - Recognising the Signs and What to Do

Substance abuse amongst staff can affect all areas of employment, whether it be a decrease in productivity, increased absenteeism or the increased likelihood of accidents and injuries. The failure to identify and deal with a problem is an unnecessary risk for businesses and can prove costly.

The Law

The Misuse of Drugs Act 1971 makes it an offence for any person to permit the production, supply or use of controlled drugs or substances on their premises, unless they have been prescribed by a doctor.

Employers also have a general duty under health and safety legislation to ensure, as far as is reasonably practicable, the health and safety and welfare at work of their employees and to make sure that no one else is put at risk as a result of the work activities of an employee.

Under the Management of Health and Safety at Work Regulations 1999 employers have a duty to assess the risks to the health and safety of their employees. If you knowingly allow an employee to carry on working whilst under the influence of drugs and this puts others at risk, you could be prosecuted.

Health and safety law applies to driving activities as it does to other work activities and the risks must be managed accordingly. Drivers must not be under the influence of drugs while driving, attempting to drive or when they are in charge of a vehicle. In addition, the Crime and Courts Act 2013 (Commencement No 1) (England and Wales) Order 2014, which came into force on 2 March 2015, makes it a criminal offence for a person to drive with a concentration of any specified controlled drug above the maximum specified limit for that particular drug.

What to Look Out For

Possible signs of drug misuse include:

• impaired performance such as lack of concentration, a tendency to become confused and poor judgement;
• sudden mood changes and unpredictable behaviour;
• poor time-keeping;
• unusual irritability and deteriorating relationships with others;
• lower personal standards – self-neglect;
• increased time off work;
• dishonesty and theft.

There may, of course, be other reasons for such behaviour patterns but it is sensible to consider the possibility that misuse of drugs could be the cause.

What to Do

Even if you are confident that your business does not currently have a problem, drug misuse that affects the workplace is a growing threat. It is advisable to have an agreed, written policy setting out the company’s position.

Employees should be well informed as to the policy and know that it applies to everyone in the company. It should form part of your overall health and safety policy. Make sure you consult with employees and with safety representatives.

The policy should include a definition of drug misuse, have clearly stated aims, name the persons responsible for carrying out the policy and give clear guidelines as to what employees must do to comply with the rules.

If an employee suffers from drug addiction, you should support them, not punish them. Offer them counselling and encourage them to seek voluntary help. Addiction could be viewed as an illness in an unfair dismissal case so disciplinary procedures may not be appropriate. The policy should contain a statement assuring employees that problems will be dealt with in confidence, subject to the provisions of the law. It should, however, be made clear that a breach of the law (for example the possession of or dealing in substances that are controlled under the Act in the workplace) will be reported to the police immediately. Make clear the circumstances in which disciplinary action will be taken.

It is important to train key staff to be aware of the signs of drug misuse and how to handle the situation sensitively.

Review your policy regularly and check that it is widely understood. If you have a staff handbook, it should contain details of the policy. Make awareness of the policy a part of the induction programme for new employees.

Where it is justified, some employers screen employees for illegal substances as part of their drug policy, particularly in safety critical industries. With the widespread advance in non-intrusive methods of testing, this is likely to become more common. However, this is a very sensitive area because of the legal issues involved and we would recommend you take advice to ensure there is no breach of your employees’ rights. Also, the results of any drug tests must be handled in accordance with the Data Protection Act 1998.

Psychoactive Substances and Your Workplace Drug Policy

The Psychoactive Substances Act 2016, which received Royal Assent on 28 January, came into force on 26 May 2016.

The Act makes it an offence to produce, supply, offer to supply, import or export any psychoactive substance if it is likely to be consumed for its mind-altering properties. There is a list of exemptions, which includes legal substances that are in everyday use, such as nicotine, caffeine and alcohol, and medicines, which are regulated elsewhere.

The substances targeted by the Act usually contain one or more chemical substances which, when consumed, imitate the effects of illegal drugs controlled by the Misuse of Drugs Act 1971. Prior to the ban, these substances were frequently referred to as 'legal highs'. They often contain ingredients that have not been tested on humans and so their effects are hard to predict. As such substances are not generally intended for human consumption, they have frequently been marketed as bath salts, incense or plant food. The drugs have three main effects – as stimulants, sedatives or hallucinogens.

Possession of a psychoactive substance is not in itself an offence, except where it occurs within a 'custodial institution' – i.e. a prison, young offender institution, remand or removal centre etc.

The Advisory, Conciliation and Arbitration Service (Acas) advises employers who do not already do so to include the use of psychoactive substances in their workplace drug and alcohol policies. As screening for their use can be difficult, Acas suggests focusing on the effects of such mind-altering substances on employees' behaviour and ability to work, rather than on the drugs themselves.

A Guide to Unfair Dismissal

Only employees have the right not to be unfairly dismissed. The right does not extend, for example, to people who are self-employed, independent contractors, members of the armed forces or workers employed under an illegal contract – e.g. a bar person under the age of 18.

Unless a dismissal is 'automatically unfair', an employee must have completed a qualifying period of two years' continuous service for their employer before they are eligible to submit a claim for unfair dismissal to an Employment Tribunal (ET).

A dismissal is classed as automatically unfair, regardless of the reasonableness, if it was for certain specific reasons or the reason for it was that the employee was seeking to exercise certain specific employment rights. These include:

• pregnancy, including all reasons relating to maternity;
• family, including taking parental leave, paternity leave, adoption leave or time off for dependants;
• discrimination – i.e. because of an employee's race, sex, age, disability, religion or belief, sexual orientation or because of gender reassignment, marriage or civil partnership;
• being a part-time or fixed-term employee or seeking to exercise the attached employment rights;
• membership of a trade union and/or trade union activities;
• carrying out health and safety duties;
• making a protected disclosure (whistleblowing);
• requesting to be paid the National Minimum Wage; and
• acting as an occupational pension scheme trustee.

A dismissal will also be automatically unfair if the reason, or principal reason, for it was a transfer to which the Transfer of Undertakings (Protection of Employment) Regulations 2006 apply or a reason connected with the transfer but which was not an economic, technical  or organisational reason entailing changes in the workforce.

In other cases, a dismissal is fair or unfair depending on the employer's reason for it and how the dismissal process is conducted.

There are five potentially fair reasons for dismissal, which are set out in Section 98(2) of the Employment Rights Act 1996 (ERA). These are:

• the employee's conduct;
• the employee's capability or qualification;
• redundancy;
• where continued employment would be a breach of a statutory restriction; and
• some other substantial reason of a kind such as to justify dismissal.

It is up to the employer to prove that the reason given for the employee's dismissal falls within one or more of these potentially fair reasons. If it cannot do so, the dismissal will be unfair.

Where the employer has demonstrated that the reason for an employee's dismissal was a potentially fair reason, the ET will then consider whether, in the circumstances (taking into account the size and administrative resources of the business), the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee (Section 98(4) ERA). This is called the 'range of reasonable responses' test, whereby the ET examines whether or not the decision to dismiss is one which a reasonable employer could have reached in the given situation. If it is, the dismissal is fair. In reaching its decision, the ET must examine the facts and not substitute its own views for those of the employer.

The procedure to be followed in order to ensure that a dismissal that is for a potentially fair reason is lawful will vary depending on what the reason is. The dismissal may still be unfair if there are procedural defects, for example failing to carry out a proper investigation before dismissing an employee for gross misconduct. Also, a final warning given in bad faith cannot be relied upon when assessing whether or not there was sufficient reason for dismissing an employee.

Where appropriate, it is important that the employer follows the Advisory, Conciliation and Arbitration Service (Acas) Code of Practice on Disciplinary and Grievance Procedures, which sets out the basic principles of fairness that should be adhered to when dealing with disciplinary and grievance matters, providing the standard of reasonable behaviour in most instances. Disciplinary situations include misconduct and/or poor performance, although an employer may prefer to have a separate procedure for dealing with capability issues.

Whilst a failure to follow the Code does not, in itself, make an employer liable to proceedings, the ET will take it into account when considering relevant claims. An ET can also adjust any compensation award made by up to 25 per cent if it feels that an employer has unreasonably failed to follow the guidance provided.

The Acas Code does not apply to dismissals due to redundancy or the non-renewal of fixed-term contracts on their expiry. Whilst redundancy is a potentially fair reason for dismissal, a redundancy dismissal may be found to be unfair – for example if a particular employee is unfairly selected for redundancy. Where the decision to make someone redundant follows the reasonable application of a fair process, however, it will not normally be open to question.

Where an employer wishes to terminate an employee's employment prior to the end of a fixed-term contract, the ordinary rules governing dismissal should apply. The termination should be treated in the same way as terminating a permanent contract. Where the dismissal is related to performance or conduct, the Acas Code should be followed. If it is by way of redundancy, consultation should be undertaken as appropriate.

In all circumstances, dismissing an employee should normally be the last resort. The employer should carry out a thorough and balanced investigation in a timely manner in order to establish the facts on which to base any decision. Employees should be kept informed at all stages and made aware of their respective rights. In order to ensure that a fair and consistent approach is followed, clear written rules and procedures should be made available to employees and steps taken to ensure that these are well understood by employees and managers.

If an employee succeeds in their claim of unfair dismissal, the ET can order reinstatement or re-engagement. However, the normal outcome is an award of financial compensation made up of a 'basic' award, to reflect the fact that the claimant has been unfairly dismissed, and a 'compensatory award' that the ET deems just and appropriate in the circumstances. The basic award is calculated based on the claimant's pay as at the effective date of termination, length of service and age, with a maximum amount of a week's pay set at £479. The compensatory award is intended to put the claimant in the same financial position as they would have been in had they not been unfairly dismissed. Reductions to the award may be made if, for example, the claimant has failed to mitigate his or her loss or failed to comply with the Acas Code of Practice. The compensatory award is subject to a cap of 12 months' pay where this is less than the statutory maximum amount of £78,962.

From 6 April 2016, the Small Business, Enterprise and Employment Act 2015 introduced a new penalty for employers that fail to pay employment tribunal awards or settlements reached through the Advisory, Conciliation and Arbitration Service in the hope that this will improve compliance. Where the amount due remains unpaid, an enforcement officer will issue a 'warning notice'. If the employer fails to pay by a specified date, a penalty of 50 per cent of the relevant amount will be imposed, subject to a minimum of £100 and a maximum of £5,000. The penalty will be reduced if payment is made promptly. The penalty is payable to the Secretary of State, not the claimant employee. Employers who are fined also face the prospect of being publicly 'named and shamed'.

Since the introduction of ET fees in July 2013, the ET can order the losing party in a case to reimburse all or part of the fees paid by the winning party. However, in employment cases, costs awards do not automatically follow the result of the case – i.e. the loser does not automatically have to pay the winner's legal costs. The ET does have the power to make a costs order (or a preparation time order where the receiving party was not legally represented) if it considers a party or their representative has acted vexatiously, abusively, disruptively or otherwise unreasonably' in the course of the proceedings, or where a claim is 'misconceived' – i.e. has no reasonable prospect of success. However, the ET may have regard to the paying party's ability to pay.

Wrongful Dismissal
Wrongful dismissal occurs when an employee's contract of employment is terminated by the employer in circumstances where the termination breaches one or more terms of the contract of employment or is in breach of the employer's statutory obligations – e.g. dismissing someone without giving them proper notice. A claim for wrongful dismissal is, in effect, a breach of contract claim and can be pursued in the civil courts or in the ET. Unlike unfair dismissal, there is no qualifying period of service needed to bring a wrongful dismissal claim.

Constructive Dismissal
Constructive dismissal occurs when an employee is not formally dismissed by their employer but is forced to leave their job against their will because of a fundamental breach of contract on the part of their employer.

Examples of serious breaches of contract are:

• cutting an employee's pay without their agreement;
• unlawfully demoting an employee without reason;
• changing an employee's duties, working hours or work location without agreement;
• allowing an employee to be harassed, bullied or discriminated against;
• making an employee work in dangerous conditions, in contravention of health and safety law; and
• a serious breach of the implied term in any employment contract that an employer should not act in a way that breaches the trust and confidence which an employee can expect from them. The 'last straw' in a series of less serious actions which cumulatively undermine the trust and confidence can also amount to a repudiatory breach of the employment contract.

In order to succeed in a claim for constructive dismissal, the employee must show that they have not acted in a way that suggests that they have accepted the breach, which is referred to in legal parlance as 'affirmation of contract'.

A Guide to Preventing Disability Discrimination in the Workplace

Under the Equality Act 2010, which repeals all previous discrimination law and brings together the relevant legislation in one place, it is unlawful to discriminate against a worker on account of a physical or mental disability or to fail to make reasonable adjustments to accommodate a worker with a disability.

It is not always necessary to categorise an impairment as physical or mental. It is the effect of the impairment, not its cause, which is material in deciding whether or not someone is disabled for the purposes of the Act. A person will be classified as disabled if they have a physical or mental impairment which has a substantial and long-term effect on their ability to carry out normal day-to-day activities.

‘Substantial’ is defined as ‘more than minor or trivial’ and an impairment is considered to have a long-term effect if it lasts for 12 months or more. Even if the condition ceases, it is still deemed a disability if it is likely to recur.

The Act does not specifically define ‘normal day-to-day activities’ but, in this context, ‘normal’ should be given its ordinary, everyday meaning and, in general, the activities are those people do on a regular or daily basis, such as shopping, reading and writing, having a conversation or using the telephone. In deciding whether an activity is a normal day-to-day activity, account should be taken of how far it is normal for a large number of people, and carried out by people on a daily or fairly regular basis. This does not have to be a majority of people, however. Some activities, for example applying make-up or using hair curling equipment, are predominantly carried out by women and would not, therefore, be said to be normal for ‘most’ people. They would, nevertheless, be considered to be normal day-to-day activities.

Normal day-to-day activities do not include work of a particular kind because no particular form of work is ‘normal’ for most people. In any individual case, the activities carried out might be highly specialised. The Act only covers effects which go beyond the normal differences in skill or ability. However, work may still involve normal day-to-day activities – for example sitting down, standing up, verbal interaction, writing, using everyday objects such as a keyboard, or lifting or moving everyday objects.

Whilst people suffering from cancer, multiple sclerosis or HIV are automatically deemed to be disabled for the purposes of Act, whether or not other illnesses constitute a disability will depend upon the full circumstances of the case. Where the effect of the illness is reduced or controlled by medication or medical treatment, its impact must be measured without reference to those improvements. However, in Metroline Travel Limited v Stoute, the Employment Appeal Tribunal ruled that a bus company employee who was able to control his Type 2 diabetes by following a diabetic diet was not a disabled person for the purposes of the Act.

The Act replaces the concept of disability-related discrimination with a new protection from discrimination arising from disability. This means that an employer discriminates against a disabled person if it treats them less favourably than it would another person because of something arising from, or in consequence of, their disability. The employer will have a defence if it can show that the unfavourable treatment was a proportionate means of achieving a legitimate aim or if the employer did not know, or could not reasonably have been expected to know, that the employee had a disability.

Where a provision, criterion or practice (PCP) puts a disabled employee at a substantial disadvantage compared with a non-disabled employee, the employer must take all reasonable steps to eliminate the disadvantage. This could include re-deployment to a different type of work if necessary. The making of an assessment as to what reasonable adjustments might be made is not in itself capable of amounting to a reasonable adjustment.

The duty to make reasonable adjustments for the benefit of an employee who becomes unable to do their job owing to disability is a positive duty which can, on occasion, require the employer to discriminate in favour of a disabled employee if he or she could carry out an alternative job within the same organisation. Depending on the circumstances, this could mean that an existing disabled employee must be given a job, even if there are other better-qualified candidates for the post, if he or she is capable of doing it.

If a non-disabled person would be affected by the PCP in exactly the same way as a disabled person, for example where its effects are purely financial, there is no comparative substantial disadvantage to the disabled person and no duty to make reasonable adjustments arises.

Nor does the duty to make reasonable adjustments to working practices extend to enabling a disabled employee who is no longer able to do their work (or any available alternative) to leave their employment on favourable terms. The whole concept of an adjustment is that it is made in order to make it possible for the disabled employee to remain in employment. It does not extend to taking steps to ensure that they are compensated for no longer being able to do so.

All reasonable steps must be taken to avoid disadvantage to disabled workers that arise because of physical features in the workplace. This could involve making adaptations to the premises, such as removing the physical feature in question, altering it or providing a reasonable means of avoiding it.

In addition, steps must be taken to provide auxiliary aids or services to help disabled personnel overcome a disadvantage. For example, a specially adapted computer keyboard could enable an employee with arthritis to overcome the substantial disadvantage posed by their condition.

These duties are also owed to job applicants. For example, employers must make adjustments to recruitment and selection procedures in order to accommodate disabled candidates, such as providing the job application form in large print for someone with a visual impairment.

In addition, in order to protect job applicants with a disability from discrimination during the recruitment process, the Act prohibits the use of questionnaires on an applicant’s general health and related issues prior to a job offer being made. This includes prohibiting the use of such questionnaires before selecting a pool of applicants from whom the successful candidate will be chosen.

The measure does not prevent employers from asking job applicants any questions about their health but stipulates that they are only allowed to do so for specific purposes, for example deciding whether a job applicant can carry out a function that is essential (‘intrinsic’) to the work concerned.

The Act also contains provisions that allow positive action specifically in the process of recruitment and promotion, in limited circumstances. These provisions mean that it is not unlawful to recruit or promote a disabled candidate who is of equal merit, in relation to the specific job or position for which they have applied, to another candidate for the same post if the employer reasonably thinks that people with a disability are under-represented in the workforce or suffer a disadvantage connected to their disability.

This kind of positive action is only allowed where it is a proportionate way of addressing the under-representation or disadvantage. The Act does not allow an employer to appoint a less suitable candidate just because he or she is disabled and that protected characteristic is under-represented or disadvantaged.

Employers must not treat an employee unfairly who has made or supported a complaint about discrimination because of disability.

Disabled employees are also protected from harassment. Harassment is unwanted conduct that is related to a person’s disability that has the purpose or effect of creating an intimidating, hostile, degrading, humiliating or offensive environment for that person or of violating their dignity.

The Equality Act also outlaws discrimination by association and discrimination by perception.

Discrimination by association, in this context, occurs when a person is treated less favourably because they are linked or associated with someone who is disabled. The person is not themselves disabled but is treated less favourably than others because of the disability of a friend, spouse, partner, parent or another person with whom they are associated. However, an employer's duty to make reasonable adjustments applies specifically to employees who are themselves disabled and does not extend to accommodate the needs of an employee's disabled relative, for example a disabled child for whom they have caring responsibility.

Discrimination by perception, in this context, happens when a person is discriminated against because they are thought to have a disability when in fact they do not.

Guidance on employing disabled people and people with health conditions is provided by the Department for Work and Pensions.

Where a worker requires support or adaptations, employers may be able to obtain a grant from Access to Work, a specialist disability service delivered by Jobcentre Plus, to help cover the costs. For further information, see the Employer's Guide to Access to Work.