Category Archives: Employment Law

Worker-Employee, what’s the difference?

Good question, you may say, since October 2016 the government has been carrying out an enquiry into whether the terms “Employee” and “Worker” are properly defined legally. Currently there are three possible categories; “employee”, “worker” and “self-employed/freelance”

“Workers” are entitled to certain employment rights, including, getting the National Minimum Wage protection against unlawful deductions from wages, the statutory minimum level of paid holiday, the statutory minimum length of rest breaks,  to not work more than 48 hours on average per week or to opt out of this right if they choose, protection against unlawful discrimination, protection for ‘Whistleblowing’  and to not be treated less favourably if they work part-time.

“Employees” have all the rights workers have plus the following; Statutory Sick Pay, statutory maternity, paternity, adoption and shared parental leave and pay (workers only get pay, not leave) minimum notice periods if their employment will be ending, protection against unfair dismissal the right to request flexible working , time off for emergencies and Statutory Redundancy Pay.

“Freelance or casual”, have none of the above rights as they are deemed to be “self-employed” and are only covered for general statutory duty of care, for their health and safety and, in some cases, protection against discrimination. Any rights and responsibilities are set out by the terms of whatever contract they can negotiate with their client.

Evidence put before the enquiry, however, suggests that two categories would improve the situation, “employed” and “unemployed”. “Employed” would mean that all workers have the same rights as employees to make things as simple as possible for businesses since tribunal and court judgments so far have not always managed to explain the differences clearly. This often creates situations where businesses look to minimise their legal obligations by trying to structure their relationships slotting people into the least burdensome category, like in the recent Uber case; what might start out as a clear self-employment relationship, in practice can turn into something quite different once the law gets involved.

We’ll have to wait and see what comes of all this but meanwhile if you need any help or advice on this or any other legal topic, give us a call.

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Filed under Arbitration, contract law, Dispute resolution, Employment Law, HR Issues, Mediation, UK Law, Unfair Dismissal, Whistelblowing, Zero hours

I’m feeling stressed!!!

As a result of a recent case relating to workplace stress or depression being seen as a disability, it may be useful to look at the law relating to disability. The law says that if an employee has a disability and is thereby put at a disadvantage compared with non-disabled employees, then the employer has a duty to take such steps as are reasonable to avoid the disadvantage. A disability is legally defined as a physical or mental medical impairment that has a substantial effect on the ability to carry out normal day-to-day activities  and is “long-term”, meaning it has lasted or is likely to last more than 12 months.

Normally these aspects of disability go together so if an impairment lasts more than 12 months it’s probably a medical condition and probably has a substantial effect on that person’s day-to-day activities.  But that’s not always the case. Recently the EAT accepted that clinical depression is a medical condition and it also accepted that it will often be difficult to distinguish clearly between stress and depression. However, the EAT also accepts that these two conditions are different; stress is a reaction to adverse life events so if those events disappear, the stress should resolve itself.

So what should employers do? Well, in practice most employers will be unable to distinguish between stress and depression, but they have a duty of care to take reasonable measures to reduce or avoid stress in the workplace. If as an employer, you can reduce stress as much as possible it will inevitably lead to a nicer place to work and probably also to greater productivity. There are limits of course, work can be stressful. But often there are things managers can do, like improving workflow systems in order to reduce the need for stressful deadlines. Change how you allocate work, not every job is time critical or vitally important so assess each job or task and allocate accordingly; this will significantly reduce pressure on your employees as they will be able to pace themselves.

Remember employee stress and clinical depression can be used in unfair dismissal cases, so it’s always best to minimise the likelihood that these reasons can be used against you, and as always if you need help or advice, give us a call.

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Filed under Duty of care, Employment Law, HR Issues, Mediation, Sick pay, Unfair Dismissal

Some Other Substantial Reason?

This is an interesting legal topic that rarely gets a mention. Most employers, employees and HR professionals are well aware of the main grounds for which an employee can be dismissed; gross misconduct, continuing misconduct after a final written warning, etc. But there is also a “catch all” legitimate ground for dismissal for “some other substantial reason”, or SOSR for short.

In order to dismiss an employee fairly an employer has to have a fair reason and follow a fair procedure, but if for example, an employer is struggling with a “problem employee” whose behaviour is affecting the morale of other staff, the employer cannot fairly dismiss the employee because of his conduct, as the issue is not the conduct itself, but how their conduct affects other members of  staff. Nor do the other fair reasons for dismissal; capability, redundancy or breach of statutory restriction apply in this situation.

Instead SOSR can sometimes be used in the following situations where the employee:

  • Causes significant business disruption because of personality clashes with others
  • Refuses to accept any changes to their employment contract
  • Is likely to divulge confidential business information
  • Can no longer be trusted
  • Causes important customers or other third parties to call for their dismissal.

Despite the above, it is important however, to follow the correct disciplinary procedure at all times regardless of the situation; the employee must have adequate warning, a chance to appeal and any concerns or issues the employee might have that caused his behaviour should be addressed well before any attitudes harden on both sides and dismissal is contemplated.

It is also important to ensure you follow the ACAS code of practice to the letter, because even if the employee contributes towards his dismissal as a result of his behaviour, employers who fail to follow the ACAS code of practice risk incurring financial penalties as well as the dismissal being deemed unfair because the correct procedures were not followed.

As always, if you need any help or advice in this or any other legal matter, why not give is a call?

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Filed under Arbitration, Dispute resolution, Duty of care, Employment Law, HR Issues, Mediation, UK Law, Unfair Dismissal

Oh, The Crosses We Have To Bear…

With the state of world affairs today, religious fanaticism, radicalisation and hatred is a topic that can spill over into the workplace, especially into the controversial area of religious symbolism. In fact two recent cases adjudged by the European Court of Justice may have muddied the legal waters somewhat.

The ruling that gained most publicity states that banning all religious, political or philosophical symbols in the workplace isn’t direct discrimination, although specifically banning symbols from just one religion would be. This was further complicated as it also stated that, “banning religious symbols would be indirect discrimination if it had a disproportionate effect on a particular religion or belief”.

Ultimately the European Court of Justice left national courts to determine if discrimination had or had not occurred in individual cases. Unfortunately, this ruling clashed with a previous ruling by the European Court of Human Rights which ruled in 2013 that, “manifesting a religious belief is a fundamental right, partly because a healthy democratic society must tolerate pluralism. The court accepted that an employer’s wish to project a certain corporate image was also legitimate, but in that particular case, the court held that the individual’s religious freedom had been unlawfully restricted.”

Religious symbolism therefore remains a legal minefield; especially should a customer wish not to be served by a member of a particular religious affiliation. Indirect discrimination is not necessarily unlawful if it can be justified in respect of a legitimate aim, such as an employer’s desire to project an image of neutrality toward its customers, which is a legitimate aim.

Ultimately make sure you apply the same rule to all religious or philosophical viewpoints and make sure it can be justified by having previously implemented a policy of religious neutrality, before you consider banning all religious symbols in your workplace.  Even then, it is probably safer just to not ban religious symbols. If you need any advice on this or any other legal matter, give us a call.

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Filed under Dispute resolution, Duty of care, Employment Law, EU Law, HR Issues, UK Law

But I don’t want to go!!

One legal issue that rarely gets mentioned is what happens if a company decides to re-locate. Many contracts of employment include mobility clauses which effectively force employees to move, leave or face dismissal. While these clauses are perfectly legal, should an employee choose to leave as a result of the move it may not just be a simple case of dismissal or dealing with a resignation, and if an employee flatly refuses to move, you may have to acknowledge they’re redundant and pay redundancy or you may find yourself at the wrong end of an unfair dismissal claim.

In a recent case, a company decided to close one of their two sites and move the workforce to the remaining site. The company did make arrangements to make redundancy payments for “exceptional circumstances” to some staff who were elderly or had specific problems which made the move impossible, but during this process, two employees were told to move under their mobility clauses and when they refused to relocate, were dismissed.

The Employment Appeal Tribunal heard that although there was a redundancy situation, the actual reason given for dismissal was “misconduct”; but since the company thought that it could rely on mobility clauses to avoid paying out redundancy payments the Employment Appeal Tribunal found that the actual reason for the dismissals was the employees’ refusal to relocate. The Employment Appeal Tribunal also found that the instruction to relocate to offices on the other side of London to be unreasonable, even with the mobility clauses, so that made the decision to dismiss unfair.

Although these types of cases are always adjudged based on the specific circumstances involved, it pays to consider the company’s options. They demanded that their employees relocate without considering the possible legal ramifications, and had they acknowledged their positions would have been redundant and they could probably have been made redundant fairly which would have resulted in redundancy payments far less than the cost of the legal action and subsequent compensation paid. So if you are planning to relocate or downsize, why not give us a call.

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Filed under Arbitration, Employment Law, HR Issues, Legal news, UK Law, Unfair Dismissal

Starting up, have you thought about…?

So the New Year is a month old and you’ve decided to start up on your own, good for you! Whatever you decide you want to do, though there are certain things you should never ignore or overlook if you want to succeed.

Have a Business Plan; this may seem obvious but you’d be surprised just how many new star ups don’t have one written down. Write down both your short term and long term objectives and how you plan to achieve them and while you’re at it don’t forget to include an exit strategy in case it all goes pear shaped. A business plan will help you set your priorities and milestones in terms of financing, customer base, suppliers, staffing, premises, etc. Remember any potential investors or banks will expect to see your plan before they commit and if you can show that you have already fulfilled some of your milestones; you are more likely to achieve a favourable result.

Get the right constitutional documents in place. Articles of Association set out all the formalities regarding the composition of a board of directors and how directors and shareholders can make decisions. Investors are likely to insist upon certain protections with new start ups, so having the right articles in place could avoid disputes which could jeopardise any third party investment.

It’s been said in other blogs here, but you cannot emphasise the importance of creating standardised written terms and conditions for both your customers and your suppliers. Apart from giving you some protection if suppliers fail to deliver or a customer fails to pay, having a legally enforceable agreement in place will mean that you can be more comfortable in finalising contracts quickly and without protracted negotiations. Protect your brand by registering your trading name as a trade mark. Don’t forget to register a domain name for all potential web addresses you’d like to be associated with your business. Intellectual Property is also important; ensure that any ideas or processes people come up with are assigned to the company, and carefully review any contract dealing with IP prior to signing, and that includes your employees. Having written contracts not only satisfies certain statutory requirements but also helps protect confidential information and trade secrets and intellectual property rights.

Have strong financial reporting, controls and procedures in place; appoint an accountant to prepare your company’s accounts so that you, and the rest of your board, understand them. This can be vital when you pitch for investment. Make Companies House filings updating the company registers, keep minutes of board meetings and ensure that your bookkeeping is accurate and up to date.

Think about insurance, whatever the nature of your business you need to have the necessary insurance in place. If you employ any staff, you will need employee liability insurance, if customers visit your premises you will need public liability insurance and if your business provides an advisory service, professional indemnity insurance should be considered.

Don’t forget tax once you start trading to ensure that you properly account for PAYE and NICs. Instruct an accountant or tax advisor to register you for VAT if applicable and to advise you on the most tax efficient means of paying yourself and staying on the right side of HMRC!

These are just a few of the many topics we can advise you on so if you’ve decided to take the plunge, why not give us a call.

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Filed under Company Law, Duty of care, Employment Law

What’s New in 2017? (Part 1)

As the new legislative year begins, here are a few pointers to what employers and employees can expect to see in the New Year as regards employment laws and laws that may impact businesses and employers in general. Firstly, pay disparity, the Gender Pay Gap Reporting regulations  that we blogged about last year, although the regulations are still in draft form the deadline for the first report is expected to be 4 April 2018 based on pay and bonus data from 2016/17.

Apprenticeships Levy; employers with an annual payroll of more than £3 million will be required to pay a 0.5% levy on their total pay bill starting on 6 April 2017. The Apprenticeships Levy is a payment that will be collected from employers in both the public and the private sectors to HMRC via PAYE returns. The idea is to encourage employers to invest in apprenticeship programmes and to raise additional funds to improve the quality and quantity of apprenticeships. All businesses accessing the levy to fund apprenticeship training in their business, may qualify for a government top-up of 10%; while small businesses will also be able to receive funding for accredited apprenticeships by contributing 10% towards the cost of an apprenticeship.

From 6th April 2017, benefit offerings provided by employers as a tax saving method, will be abolished from 6 April 2017. Employees will then have to pay the same tax on what they put into these salary sacrifice schemes as they would on any other income, and employers will have to pay the same NI. Schemes related to pension savings and advice, childcare, cycle-to-work and ultra-low emission cars, will not be affected. Schemes already in place prior to April 2017 will be protected until April 2018, while arrangements related to cars; accommodation and school fees will be protected until April 2021.

Next week we’ll look at the changes to the national living wage, trades union legislation, the visa levy and the new data protection regulation. As always, if you need help or advice give us a call.

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Filed under Employment Law, HR Issues, Legal news, UK Law