Category Archives: Employment Allowance

Holiday Commission Payments – The Verdict

Posted on by

Finally we have the decision about the calculation of commission payments.

This well publicised case was brought by Mr Lock, an employee of British Gas. He was paid a basic salary and commission based on the sales he made which represented, on average, over 60% of his take home pay.

British Gas paid holiday pay to Mr Lock based on his basic salary only, plus commission on sales he had earned prior to the holiday period. This resulted, in the weeks and months after the period of leave, in times when Mr Lock only received basic salary and not commission. This was because Mr Lock was not at work during the period of leave, did not make sales and did not generate any commission.

Mr Lock brought a claim against British Gas contending that his holiday pay should be based on basic salary and average commission.

The employment tribunal asked the European Court of Justice (ECJ) whether employers should include commission when calculating holiday pay and both decided that Mr Lock should be paid holiday pay including overtime. Since the ECJ we have been awaiting for the employment tribunal to see how to give effect to the ECJ decision.

At the hearing Leicester employment tribunal made it clear that the case was not about whether the commission received by Mr Lock should be included because the ECJ had already decided that it should. The case was about whether the Working Time Regulations could be interpreted to give effect to the ECJ decision.

The employment tribunal concluded that it could by adding wording to the Working Time Regulations which requires employers with workers who have normal working hours but who receive commission or similar payments to calculate holiday pay as if their pay varied with the amount of work done. The effect is to require employers to calculate holiday pay based on an average of the previous 12 weeks’ pay.

The Next Steps

Not all commission payments will qualify and have to be taken into account. You should reconsider how you calculate holiday pay if you operate a similar commission scheme, as you may face a claim for back pay. Legislation was introduced to limit the impact of such claims by restricting back pay for two years for cases on or after 1 July 2015.

This decision relates only to the calculation of four week’s holiday and not the entire current statutory minimum of 5.6 weeks or any enhanced holiday. You should also check any contractual provisions. If you need any help calculating holiday pay for your employees, call us on 0118 940 3032 or click here to email us.

What’s the Best Way to Keep Your Staff Happy?

Posted on by

Happy employees make happy clients and customers. Here’s a check list of all the things you should be doing, to keep your staff – and therefore your clients and customers – happy. How many are you doing?

  • Improve their engagement with your company – low cost options include offering flexibility, the opportunity to buy or sell holiday and working from home
  • Cheer everyone up – buy them food at work
  • Give lots of praise – in public, if necessary
  • Recognise their achievements – a lot
  • Be reassuring (but realistic) about job security
  • Be flexible about working hours and opportunities to improve their work life balance
  • Be open, honest and involved with your team
  • Keep them in touch with all the news – good or bad
  • Keep up with employees training and development – it does not need to cost a lot. Don’t abandon development and new opportunities. Job training is perceived as a value
  • Develop your company culture – involve everyone in decisions and provide opportunities for staff who don’t normally work together to get to know each other
  • Offer chances to put forward suggestions – it could save you a fortune and it increases the sense of ownership and belonging
  • Provide regular team meetings to reinforce the company culture and beliefs
  • Think about using a promotion as a low cost way of improving self-esteem and self-worth
  • Treat everyone with respect – it doesn’t cost anything and it improves motivation.

How well did you score? What more could you be doing to keep your staff happy?

How Do You Investigate Staff Issues?

Posted on by

If one of your employees raises a grievance at work, against one of their colleagues, you need to carry out an investigation into the situation, before you make any decisions. How do you go about doing this?

The first thing to consider is that the person against whom the grievance has been raised cannot carry out the investigation. Look for an impartial party to do it, who should decide what information they need in order to fully understand the situation. They should then interview the person who has raised the grievance, before speaking to the other party and anyone else involved. They should produce written evidence and be prepared to look for evidence both supporting the employee and against them.

All people involved should be asked not to discuss the allegation, or look for corroborating evidence or verification of what the employee and other staff are saying. They should also keep an open mind, as what they uncover may not be what anyone expects. For example, someone may be unhappy at work because of a family bereavement they haven’t told anyone about.

The next stage is to respond to the person who raised the grievance, with your decision based on the evidence. It may be appropriate to bring the two people together to discuss the evidence so that they can discuss the situation and plan how to resolve the situation. You must always respond to a formal grievance in writing, with your decision based on your investigation and offer the right of appeal.

The point of carrying out an investigation is so that you do not blunder into a grievance situation, without first finding out what is really going on. If you don’t have your own policy to follow, then use the guidelines published by Acas. As with most employment matters, following a clear process will keep you safe, if an aggrieved member of staff doesn’t like the way in which their grievance has been handled!

Three Stages to Getting Recruitment Right – Part One

Posted on by

Three Stages to Getting Recruitment Right – Part One

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.

First we’ll look at how to find the best person, then we’ll look at what to do when they 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 One – How do you find the right person?

So your business is growing and you’re getting busier and busier. You’re working longer hours, just to keep up with the work and the demands of your clients. You don’t want to turn business away, so you keep working all the hours you can, including evenings, weekends and holidays. Eventually, when your friends and family are really fed up of not seeing you and you’re completely exhausted, you decide it’s time to take on your first member staff.

But you’re too tired to think about it properly and you certainly don’t want to spend your hard earned cash having someone else do the recruitment. So you put the word out among your contacts and network that you need some help in your business. You’re not quite sure what the job would involve, how many hours it will be, or how long you’ll need them. But that doesn’t really matter does it? You just need someone to ease the burden – and quickly!

A number of people respond to your plea for help and you chat to a few of them. One of them seems quite nice and can start straight away, so you meet up to talk a bit more and then offer them the job.

Sounds easy doesn’t it?! Until you find out that your brand new team member doesn’t actually like doing some of the tasks you need them to do. But never mind, there’s plenty of other work to keep them busy. And then they ask about taking some time off for a holiday and one of your clients complains that some of their work hasn’t been done. Before long, you find yourself working longer hours than before you hired someone, just to check up on their work and correct their mistakes. The atmosphere in the office changes and you don’t look forward to going there in the morning.

That wasn’t supposed to happen – it’s your business and you’re supposed to enjoy what you do!

So how do you avoid all these problems? Do some planning! Think really carefully about the sort of person you want working with you and what they will do. Create a solid job description that includes the hours they will work. You can always start someone on part-time hours if you want to try them out. Most importantly, don’t leave recruitment until you’re desperate for help, as this will make you more likely to take on the first person who comes along, who you think will ‘do’. They probably won’t! If you have any doubts about a potential employee, deal with those doubts and take your time to find the best person for your business.

In Part Two of this series we’ll look at what to do when your new recruit (who really is the right person) starts working with you.

What Are The Latest Employment Law Updates?

Posted on by

What Are The Latest Employment Law Updates?

On 1 May 2014 we held our latest Employment Law Update workshop, when we looked at some of the recent changes that you need to know about, as an employer. Here is a summary of some of the changes.

  • Workers from overseas – from 1 January 2014, restrictions on working in EU states were lifted for Bulgarian and Romanian workers. Remember to check the right to work in the UK for all employees.
  • Employing illegal workers – from 6 April 2014, the maximum civil penalty for employing an adult subject to immigration control, who does not have the right to work in the UK, increased to £20,000 from £10,000. New guidance has been issued by the Home Office in the “Full guide for employers on preventing illegal working.”
  • Employment Allowance – from 6 April 2014 a £2000 reduction in the NIC bill for all businesses and charities has been introduced. HMRC has a calculator and information you can use here.
  • Employment tribunal fees – from 6 April 2014 some re-categorisation of claims has been done. As a reminder, Type A claims are £160 for the issue fee plus £230 for the hearing fee; Type B claims are £250 for the issue fee and £950 for the hearing fee. Type B claims include unfair dismissal. The Tribunal can order the employer to pay if the claim is successful.

These are just a few of the recent changes and we’ll cover more in future blogs. More changes will continue to be made throughout the year to Employment Law. To keep up to date, subscribe to our newsletter here, keep reading these blogs, or come to our next workshop, which will be held in the autumn.