How Do You Manage Employee Probation Periods? Part One

By setting a probationary period, as an employer, you can let newly recruited employees know that their performance will be under continuous review during the first weeks and months of employment. It also lets them know that their continued employment is subject to them completing the probationary period. This can help you to manage the employee’s expectations and their relationship with you, as their employer.

Length of Probationary Period

The length of a probationary period will depend on the position and your requirements. A role requiring a high degree of skill and responsibility is likely to need a longer probationary period than one with limited skills or responsibility. Probationary periods are typically between three and six months.

You should set out in writing to your employee that the position is subject to satisfactory completion of a probationary period. You should also specify the length of the probationary period, how progress will be monitored and reviewed and that the probationary period may be extended.

It is important for you to set out employees’ roles and responsibilities at the outset and to go through a comprehensive induction process.

It is advisable for you to hold frequent review meetings or one-to-ones with your new employees to provide progress updates, encouragement and support and to identify training needs. If performance issues are identified during the probationary period, you should consider whether or not extra training or coaching would be appropriate, rather than leaving it to the end of the probationary period before addressing performance issues.

Statutory Employment Rights

Probationary periods have no legal status and an employee who is on probation has the same statutory employment rights as other employees. It is the length of continuous service that defines an employee’s statutory employment rights, including his or her rights in the event of dismissal.

Probationers are entitled to:

  • the national minimum wage
  • statutory sick pay
  • rights under the Working Time Regulations
  • annual leave entitlement
  • family-related rights in the same way as other staff.

Dealing with Disciplinary Issues

Employers often don’t apply their formal disciplinary procedure to employees on probation. To avoid ambiguity, where you do not want to follow your full procedure, you should make clear, in writing, in the contract and/or disciplinary procedure, that there is no contractual obligation for you to do so.

As probationers do not normally have sufficient service to claim unfair dismissal, they cannot challenge the procedural fairness of a dismissal in the employment tribunal.

However, a probationer could claim that a dismissal was for an automatically unfair reason or for reasons that amount to unlawful discrimination. Therefore, where an employee on probation is suspected of misconduct, you should investigate further before taking action. If you prejudge the situation and dismiss the employee without going through your disciplinary process and giving the employee the opportunity to explain his or her version of events, this could increase the risk of a claim of unlawful discrimination or automatically unfair dismissal. You will be in a better position to argue that the reason for dismissal was the employee’s misconduct if you investigated the matter and can show reasons behind its decision to dismiss.

Extending the Probationary Period

Where an employee has not reached the required standard of performance by the end of the probationary period but you recognise that there is potential for improvement, you might choose to extend the probationary period. The right for an employer to extend the probationary period should be set out in the contract or offer letter, which should also make clear the terms and conditions that will apply during the extension period.

The extension should be for a reasonable period, taking into account how long it might take him or her to complete an improvement plan. You should discuss your employee’s performance and why you are extending the probationary period with him or her and allow the employee to put forward any explanation for the performance issues.

The extension should be agreed and arranged before the original probationary period ends.

Sickness Absence

Sickness absence during a probationary period will need to be monitored and managed in the usual way. Where the absence is frequent and/or long term, this may make it difficult for you to assess the employee’s performance during the course of the probationary period because of their reduced attendance.

You will need to consider whether to: terminate the contract due to the employee’s failure to complete the probationary period satisfactorily; extend the probationary period to give the employee more time to demonstrate his or her suitability for the job; or confirm the employee in post regardless of the absence.

You should investigate the sickness absence to find out if it is due to a disability under the Equality Act 2010. If it is, but you dismiss the employee for failing to complete the probationary period satisfactorily, they may have grounds to bring a disability discrimination claim. You would need to be able to justify your actions.

In part two of this series of blogs, we’ll look at what to do if all goes well through the probation period and you decide to keep your new employee on. If you need any advice now about how to handle probation periods, get in touch by emailing sueferguson@optionshr.co.uk or calling me on 0118 940 3032.

What’s the Safest Way to Withdraw a Job Offer?

I have been asked a lot of questions recently about withdrawing job offers based on poor references, so I thought that I would write about it in more detail here. 

Can you withdraw a job offer once it has been made? What risks do you face as an employer if you change your recruitment plans?

Sometimes you will need to withdraw an offer of a job. The hiring situation may change because of a general recruitment freeze, a restructure within your organisation or a change of management. The funding for the post might have been withdrawn or you may become aware that the selected candidate is not suitable after all.

Job offers can be withdrawn after they are made, but there are risks associated with doing this. Withdrawing an offer because circumstances have changed looks like bad planning and could affect your company’s reputation. The employee may be able to bring a tribunal claim for breach of contract.

When is the contract of employment formed?

An employment contract is formed once an unconditional job offer is made and accepted. If you withdraw an unconditional job offer once it has been accepted, you are effectively terminating the contract and could be liable for damages for the individual’s loss.

Even though the individual has not started working for you, there will be a notice period due – just as with other terminations. Damages could amount to what the individual would have received if you had given proper notice – including any pay and benefits due.

What if your recruitment plans change?

If your recruitment plans change due to business needs and you have to withdraw job offers, you should notify the recruits as soon as possible to try to limit the damage and enable them to mitigate their potential loss. The selected candidate might not have resigned from their current employer yet. If they have, they may still be able to ask for their old job back – the sooner this is done the better.

Pre-recruitment checks and job offers

Most job offers are conditional on the new recruit satisfying certain conditions. The selected candidate may need to provide references or evidence of qualifications, or they may need to demonstrate their right to work in the UK. If the individual does not satisfy one or all of those requirements, you can withdraw the job offer without being liable for damages.

If you don’t make it clear that the job offer is conditional, and then withdraw the offer because the recruit has not satisfied one of your requirements, this will amount to a breach of contract and you may be liable for damages. Offers of employment should make absolutely clear that they are conditional on certain requirements being met. Failure to do so can be costly.

If you’re considering making or withdrawing a job offer and you want to make sure that you’re doing it properly, contact us first for some advice. Call us on 0118 940 3032 or email sueferguson@optionshr.co.uk.

What Impact Will Brexit Have on Employment Law?

Although much UK employment law is derived from EU law, the UK’s withdrawal from the EU is unlikely in itself to have an immediate impact on employment law as most EU Directives are implemented in the UK by regulations or Acts of Parliament. It will be for Parliament to decide whether to retain, amend or repeal domestic legislation.

It is possible that the UK will be required to continue to implement elements of EU legislation as a condition of a negotiated trade deal between the UK and EU.

Many areas of domestic law that are derived from EU law have been heavily influenced by decisions of the European Court of Justice (ECJ), for example working time, TUPE and discrimination law. ECJ decisions will continue to apply in the UK until the Government or the UK courts determine otherwise.

What impact will Brexit have on EU nationals currently working in the UK?

It is not yet known what rules on immigration and free movement of people will be in place following the UK’s withdrawal from the EU. However, employers can reassure employees who are EU nationals that there will be no immediate change in their right to live and work in the UK. The same is true of nationals of the other countries of the European Economic Area (EEA) (Iceland, Norway and Liechtenstein) and of Switzerland.

EEA and Swiss nationals who have lived in the UK for five years or more as a “qualified person” have acquired the right to permanent residence. A qualified person is someone who is working, studying, self-employed, self-sufficient or looking for work. A person who has qualified for permanent residence can apply for a document certifying this.

The UK will have a period of up to two years within which to negotiate the terms of its withdrawal. The rights of EU nationals to come to the UK to live and work in the future will be a key element of the negotiations. It is likely that EU nationals who are already living in the UK will be afforded special status, with reciprocal arrangements for UK nationals living in EU countries.

One option for an immigration framework, in the absence of a negotiated deal allowing freedom of movement between the UK and the EU, is that the current points-based system that applies to workers from countries outside of the EEA could be extended to EEA nationals. For most employers, the main route for employing foreign workers under this system is by sponsoring skilled workers, where they can show that there is a shortage of suitably qualified applicants within the resident labour market. There is scope for a points-based system to be extended to allow the employment of non-skilled workers as well as skilled workers.

On 18 October 2016 we’ll be running our next Employment Law Update workshop, to bring you right up to speed on any changes that might affect your business. You can book your place online here.

 

Information Source: XpertHR

The Latest Legal Changes to Employment

Every year around April and October, changes are made to Employment Law that will affect some, if not all of your employees. In April we ran one of our popular Employment Law update workshops, to tell our clients and contacts what they need to know. If you missed it, here’s a summary of what we covered.

More changes will be happening later this year, so we’re running our autumn event on 18 October 2016 and we’ll send you a reminder nearer the time. In the meantime, if you have any questions about the latest changes and what you need to do about them, do get in touch.

Here are some of the issues we discussed at the recent workshop:

Statutory Rates – these usually change, but this year, statutory family-related pay and sick pay rates were frozen.

Postponing a Tribunal – under rule 30A of the Employment Tribunals Regulations 2013 for proceedings presented on or after 6 April 2016, changes have been made, in order to limit the number of postponements and adjournments that can be granted in a single case in the employment tribunal and introduce a deadline after which applications for a postponement will not be allowed. Employment tribunals must also consider making an award for costs where postponements are granted at late notice.

National Living Wage – this applies to all employees over 25 years of age. The new rate from 1 April 2016 is £7.20 per hour, and is expected to increase to £9 per hour from April 2020. Also from 1 April 2016, the penalty was set at 200% for the total underpayment, for each employee who has been underpaid. 300,000 employees will benefit from this increase, with employers needing to find an estimated £3 billion by 2020. The Government intends to align when the national minimum wage and national living wage rates are amended, to be April for both with effect from April 2017. It has asked the Low Pay Commission to recommend the rate of the national living wage and the national minimum wage for April 2017 and to provide an indicative rate of the national living wage for April 2018. The Commission is due to report back on its findings in October 2016.

Zero Hours Contracts – legislation came into force on 11 January 2016, which states that individuals on a zero hours’ contract must not be unfairly dismissed or subjected to a detriment for breaching an exclusivity clause.

National Insurance for under 25s – employer NICs have been abolished for apprentices under the age of 25. As part of the Government’s drive to encourage employers to create more apprenticeships for young people, from 6 April 2016, employers will not pay employer national insurance contributions for apprentices aged under 25.

New State Pension – a single-tier state pension was introduced on 6 April 2016, replacing the previous basic state pension and additional state pension. Employer-provided pension schemes will no longer be able to contract out of the state pension and receive a national insurance rebate. This means that, where an employer provides a previously contracted-out scheme, its employer and employee national insurance contribution liability will increase. Employers should ensure that employees are aware that there may be an impact on their pay.

The Gender Pay Gap – these new regulations will apply from 1 October 2016, for all private-sector and voluntary-sector employers with 250+ employees. Companies will be required to publish the gender pay gap as it is in the pay period in which 30 April 2017 falls.

If you think that your company and your employees will be affected by any of these changes, please do get in touch for a confidential chat. Call 0118 940 3032 or email sueferguson@optionshr.co.uk.

Staff Accuse B&Q of Using the National Living Wage as an ‘Excuse’ to Cut Pay and Benefits

Employers are being warned to avoid kneejerk moves when introducing measures to offset increased wage costs.

A petition drafted by a B&Q manager, accusing the DIY retailer of slashing employee benefits in an effort to offset the costs of the national living wage (NLW), has so far attracted more than 120,000 signatures. As an employer you could face a similar negative reaction if you attempt to alter terms and conditions as a result of the law to increase salaries for your lowest paid staff. The £7.20 an hour wage came into force on Friday 1 April.

As part of the change, the B&Q employees say that the retailer has suggested time-and-a-half pay for working Sundays and double time for working bank holidays; a restructuring of allowances for employees working in parts of the UK where the cost of living is higher; and the removal of a summer and winter bonus, which equates to 6% of annual salary.

The petition says that B&Q staff are required to accept the new terms and conditions of employment, or face losing their job.

“Big businesses like B&Q are using the NLW as an excuse to cut overall pay and rewards for the people who need it the most,” the petition reads.

B&Q denies that the changes to terms and conditions are as a result of the NLW, stating that a review of its pay and reward framework was launched “long before” the new wage was announced.

A B&Q spokesman said: “Our aim is to reward all of our people fairly so that employees who are doing the same job receive the same pay. That isn’t the case at the moment, as some have been benefitting from allowances for a long time when others have not, and that can’t continue.”

A survey from the Federation of Small Business found that 54% of SMEs believe they have been negatively impacted by the 50p an hour increase in pay, and will put off hiring new staff as a result. 41% will cut staff hours, while 26% plan to erode pay differentials by freezing or cutting the wages of higher paid staff.

According to analysis by the FT, employers are actively are actively considering increasing the number of self-employed individuals or apprentices – all of whom are exempt from the NLW – in their staffing mix.

But Esther Smith, employment partner at UK law firm TLT, warned that this could leave employers open to discrimination claims.

“Employers may, consciously or unconsciously, look to employ younger people to avoid the higher wage costs.  Also, if they operate zero hours’ contracts, they may elect to offer less work to those people over 25,” she said. “Both of these actions would expose the employer to age discrimination claims.”

Before you make any major decisions which could affect your business and your employees, get in touch by contacting us on 0118 940 3032 or emailing sueferguson@optionshr.co.uk.

What Do You Do if an Employee Appeals Your Decision?

If you’ve had to make a decision about one of your employees and an issue such as their flexible working request or a disciplinary situation, your employee has the right to appeal against your decision.

What do you do next? How should you handle their appeal?

Your employee can appeal against a disciplinary decision on both conduct and performance matters, or any other employment decision, but they must do so in writing. They need to set out the grounds for their appeal within the number of days set out in your own policy, of you giving them your decision.

You should then hear their appeal without delay. Where possible this should be done by a manager, preferably more senior and not previously involved in the case. This is not always possible in a smaller business, so the same manager or owner may have to hear the appeal, and they must be objective. At this meeting you need to hear what your employee has to say, and consider it against all the facts. You may need to carry out further investigations in order to reach your conclusion, before making your final decision.

Following the meeting, you should write to your employee to tell them the outcome of the appeal, and how the decision was reached. Examples of all the letters for all stages of the formal disciplinary process are available from the Disciplining staff section of the Acas website.

Whatever decision is made regarding the appeal, you must keep a confidential written record of the case.

If you run a small business and need someone impartial to handle appeals, or initial disciplinary meetings for you, do get in touch to talk about how we can do this for you. Call us on 0118 940 3032 or email sueferguson@optionshr.co.uk.

Zero Hours Update – the Latest Developments

A zero-hour contract is the name given to a type of contract, where an employer has the discretion to vary employee’s working hours, usually anywhere from full-time to “zero hours”. The employer typically asserts that they have no obligation to provide work for the employee.

There have been a number of changes made to the rules governing these contracts in recent months and the Department of Business, Innovation and Skills (BIS) has published some guidelines for employers, suggesting the following:

  • Zero hour contracts are only appropriate in situations where an employee is engaged in seasonal work or a one-off event
  • When recruiting, you should clearly advertise the job as a zero hour contract and inform any applicant that hours are not guaranteed
  • You should include within the contract whether you deem the individual an ‘employee’ or a ‘worker’, what rights they are entitled to, how work will be offered to them, and how the contract can be terminated
  • As an employer you should give as much notice as possible when you can’t offer work
  • This is addition to the fact that exclusivity clauses have been prohibited since May 2015. There is more about this in a previous blog here.

In addition to this guidance, the BIS’s Exclusivity Terms in Zero Hour Contracts (Redress) Regulations 2015 give more protection for employees on zero hours contracts. They will have a right not to be unfairly dismissed if the reason is that they have failed to comply with an exclusivity clause. There is no qualifying period of employment needed to bring such a claim. Zero hour workers have the right not to be subjected to detriment because of non-compliance with an exclusivity clause and if you breach these rights, a worker may issue a claim and seek a declaration or compensation.

What does this mean for you as an employer?

If you use zero hours contracts, then you should do the following:

  • Review your employment contracts
  • Audit your workforce to see if zero hours contracts are the appropriate contracts to use, in line with the BIS guidance.
  • Contact us if you need any help with sorting this out! Call us on 0118 940 3032 or click here to email me.

The Year Ahead – Expected Changes to Employment Law

In 2016, employers will see a number of key Employment Law changes. Here is a summary of those agreed so far, to help you prepare for how they might affect your business.

January 2016

Redress for workers punished for breaching exclusivity clause – Regulations came into force on 11 January 2016 to enable workers who suffer a detriment, or are dismissed as a result of breaching an exclusivity clause in a zero hours contract, to make a complaint to an employment tribunal.

March 2016

Gender pay reporting details revealed – Regulations must be introduced by 26 March 2016 that will require employers with 250 or more employees to publish information about their gender pay gaps.

April 2016

National living wage introduced – A new compulsory national living wage, which works as the top rate of the national minimum wage, will be introduced on 1 April 2016 for workers aged 25 and over.

Duty to prepare modern slavery statement takes effect – The duty to prepare a slavery and human trafficking statement (which has been in force since 29 October 2015) will apply in relation to financial years ending on or after 31 March 2016, for companies with a turnover of at least £36 million per year. This will begin to take effect for employers from 1 April 2016, depending on the timing of their financial year.

Penalty for failure to pay national minimum wage doubled – Draft Regulations double the penalty for non-payment of the national minimum wage and the national living wage for pay reference periods starting on or after 1 April 2016.

Statutory pay changes – The maximum amount of a week’s pay for the purposes of calculating statutory redundancy pay, and other awards such as the basic award for unfair dismissal, is likely to increase on 6 April 2016. The weekly rates of statutory sick pay, maternity pay, paternity pay, adoption pay and shared parental pay will not increase for 2016/17.

October 2016

National minimum wage – This may rise on 1 October 2016, subject to the prevailing economic conditions and the Low Pay Commission’s report, which is due to be delivered to the Government in February 2016.

There are many other changes that are yet to be confirmed, including the Trade Union Bill coming into force, a cap on public-sector exit payments being introduced and new rules on apprenticeships. We’ll bring you news of all these and other changes as they are confirmed. If you have any questions about these changes and how they affect your employees and your business, do get in touch by calling 0118 940 3032 or by clicking here to email us. We will be running our next Employment Law Update workshop on 12 April 2016. Click here for details and online booking.

The Latest News on Zero Hours Contracts

The Government has banned the right to include an exclusivity clause in Zero Hours contracts. This means that you can’t employ someone on a Zero Hours contract and then try to prevent that person from doing other work, or stop them from working without your consent.

The clause is now illegal, so if any of your employees have this clause in their contract, as their employer, you can no longer enforce it. The ban became legal on 26 May 2015.

Zero Hours contracts, when used correctly, are very effective, e.g. for students during holiday periods or seasonal work. These casual contracts allow employers to hire staff with no guarantee of work. They mean employees work only when they are needed by employers, often at short notice. Their pay depends on how many hours they work. A Zero Hours contract is generally understood to be a contract between an employer and a worker where the employer is not obliged to provide any minimum working hours, and the worker is not obliged to accept any work offered. Zero hours workers have the same employment rights as regular workers, although they may have breaks in their contracts, which affect rights that accrue over time. They are also entitled to annual leave, the National Minimum Wage and pay for work-related travel in the same way as regular workers.

Zero hours contracts can be used to provide a flexible workforce to meet a temporary or changeable need for staff.

Examples may include a need for workers to cover:

  • unexpected or last-minute events (e.g. a restaurant needs extra staff to cater for a wedding party whose original venue cancelled)
  • temporary staff shortages (e.g. an office loses an essential specialist worker for a few weeks due to bereavement)
  • on-call/bank work (e.g. one of the clients of a care-worker company requires extra care for a short period of time).

If you have staff with Zero Hours contracts and you’re not sure if you have the exclusivity clause in those contracts, contact us on 0118 940 3032 or click here to email us and we’ll talk you through it.

 

Three Stages to Getting Recruitment Right – Part Two

In three blog posts I’m going to cover some of the basics of getting recruitment right – especially if you’re taking on your first member of staff. Last time we looked at how to find the best person (click here if you missed that post or would like to read it again.) In Part Two we’ll look at what to do when your new recruits start working for you and in the third blog, I’ll talk about what to do at the end of their probation. This three stage process will help you find and keep hold of the best people for your business – and avoid some costly pitfalls!

Part Two – How do you make sure they get off to the best start?

Recruitment can be a long, expensive and time consuming process. After all the effort of finding the right person to join your team, you want to help them settled in as quickly and smoothly as possible. Some new staff have been known not to show up after the first weekend, or even on their second day and you don’t want that!

Particularly if you’re taking on your first member of staff, take the time to plan their induction. Make sure they have somewhere to sit and a computer to work at – if that’s part of their job!

Induction training must include the following elements:

  • General training relating to your business, including values and philosophy as well as structure and history
  • Mandatory training relating to health and safety and other essential or legal areas
  • Job training relating to the role that they will be performing
  • Training evaluation, including confirmation of understanding and feedback about the quality and response to the training.

You will also need to take up the references that they provided you with, check the qualifications they say they have and confirm they have the right to work in the UK. (The law about foreign workers has changed recently – there are more details here.)

Acas has produced a very useful Induction Checklist which will give you more ideas on what to cover during induction. You can download it here.

In Part Three of this series we’ll talk about what you need to do once your new recruit (who really is the right person and has started off well) reaches the end of their probation period.