Tag Archives: employment tribunals

Fair Dismissal Can Prevent Tribunal Troubles

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Did you know that since the fees for tribunals were waived in July 2017, there has been a 90% increase in employment tribunal claims?

To protect yourself from risk of being taken to court for unfair dismissal, it’s important to know the difference between ‘fair’ and ‘unfair’ dismissal, as well as ‘wrongful’ and ‘constructive’ dismissal.

Do you know the differences? What about the relevant laws, and codes of practice? If you’re unsure of any of these and don’t want to risk paying thousands of pounds in compensation to employees taking you to tribunal, this blog will help.

What is Fair?

When you need to carry out a dismissal, it’s important to ensure that it’s fair on the employee not only for them, but also for the reputation and integrity of your organisation.

One of the first things you, as an employer, must understand is the differences between ‘fair’ and ‘unfair’ dismissals. ‘Unfair’ dismissal is usually where an employee was dismissed, for example, because of pregnancy; a family situation such as time off for dependents; or in contravention of the Working Times Regulations. These are just three examples of many that could end with you in a tribunal court if they weren’t handled correctly.

For a dismissal to be deemed ‘fair’ as stated under Section 98 of the Employment Rights Act 1996, it would need to be carried out for one of these five reasons:

  1. Capability or performance
  2. Conduct
  3. Redundancy
  4. Contravention of a statutory duty or restriction
  5. “Some other substantial reason of a kind such as to justify the dismissal of an employee holding a position which the employee held.” (This is a direct quote from the Employment Rights Act 1996.)

Let’s delve into each point a little further:

  1. Capability or performance

An employee can be dismissed if:

  • They do not have the capabilities to do the job duties they were employed for
  • They have the capabilities, but are unwilling to do the job properly

However, you should still have a process of looking further into each point to find out more about their situation, especially as poor performance could be down to health issues, or because of stress. Read more about that here.

  1. Conduct

When there’s clear evidence of misconduct, such as persistent lateness or unauthorised absence from work, action should be taken to try to understand why the misconduct is happening, and to give your staff member a chance to improve. For more information on this, read my blog on Managing Capability and Conduct Issues Effectively to Avoid Dismissal.

If gross misconduct is evident, this must also be handled carefully and within the legal parameters of employment law. For more on this, click here.

  1. Redundancy

Making people redundant is always difficult, but may be necessary if the business is changing in some way, moving location, or even closing down. To genuinely make someone redundant, you must demonstrate that the employee’s job will no longer exist. Of course, the employee has certain rights throughout the redundancy process, such as needing time off to look for a new job, and they may be entitled to redundancy pay. Read more on this subject here.

  1. Contravention of a statutory duty or restriction

One example of this is of employees not having the right to work in the UK anymore, or not having proof of their immigration status. Other examples can include undertaking Trade Union duties, or not providing relevant work evidence to support their employment.

  1. Some other substantial reason

If none of the above four reasons for dismissal apply, then the phrase “some other substantial reason of a kind such as to justify the dismissal of an employee holding a position which the employee held” becomes admissible. Examples include:

  • Non-renewal of the fixed-term contract of an employee recruited as maternity leave cover
  • Dismissal and re-engagement of an employee to impose new contractual terms and conditions that the employee has refused to agree
  • A personality clash between employees makes working together impossible
  • Where there are concerns relating to the safeguarding of children or vulnerable adults, but there are no grounds for a misconduct dismissal

I have covered this last point in more detail in other blogs that you can read here.

Even where a dismissal is potentially fair for “some other substantial reason”, it’s important that you follow a fair procedure and act reasonably in dismissing the employee, taking into account all the circumstances.

Being such a minefield, it’s important to get expert help when you need to dismiss someone to reduce the risk of being taken to court.

Before you dismiss any member of staff, for whatever reason, it is best to seek professional HR advice. You can call me on 0118 940 3032 for a confidential chat or click here to email me.

Settlement Agreements Used to be Called Compromise Agreements. What Changed?

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In the UK, a compromise agreement – now known as a Settlement Agreement – is a specific type of contract, regulated by statute, between you the employer and one of your employees (or ex-employees) under which your employee receives payment in exchange for agreeing that they will have no further claim against you as a result of any breach of a statutory obligation by your organisation.

A Settlement Agreement is a legally binding contract which can be used to end an employment relationship on agreed terms. Their main feature is that they waive an individual’s right to make a claim to a court or employment tribunal on the matters that are specifically covered in the agreement. Settlement Agreements may be proposed prior to undertaking any other formal process. They usually include some form of payment to the employee by the employer and may also include a reference.

For a settlement agreement to be legal, the following conditions must be met:

• The agreement must be in writing
• The agreement must relate to a particular complaint or proceedings
• The employee must have received advice from a relevant independent adviser on the terms and effect of the proposed agreement and its effect on the employee’s ability to pursue that complaint or proceedings before an employment tribunal
• The independent adviser must have a current contract of insurance or professional indemnity insurance covering the risk of a claim by the employee in respect of loss arising from that advice
• The agreement must identify the adviser
• The agreement must state that the applicable statutory conditions regulating the settlement agreement have been satisfied.
• A Settlement Agreement can be proposed by both employers and employees although they will normally be proposed by the employer. A proposal can be made at any stage of an employment relationship.

Acas has produced a comprehensive Code of Practice on Settlement Agreements, which you can download for free here. It is very important to take HR advice before starting a process of discussing a Settlement Agreement with your employees so do get in touch if you have any questions. Please call me on 0118 940 3032 or click here to email me.

Are You Up to Date in Employment Law?

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In April, I held a workshop in which I shared the latest Employment Law updates. As usual, the workshop was well received, and everyone learnt a lot of new, essential information to help run the HR aspect of their businesses both smoothly and legally.

In this blog, I talk about some of the less obvious but equally important aspects of Employment Law – Sick Pay, termination payments and Employment Tribunal fees and claims. If you couldn’t attend my workshop, check here to see if your HR is current and fully compliant. If you’re not sure, then do get in touch – I’ll be delighted to help ensure your business is fully legally compliant.

Withholding Sick Pay

An interesting question has been posed about the possibility of withholding occupational or statutory sick pay (SSP) for an employee who is frequently absent from work due to sports injuries. The answer to this is a definite ‘no’ for the SSP aspect – if the employee provides the necessary incapacity evidence, then the cause of his or her injuries is irrelevant.

However, you may be able to withhold occupational sick pay, but that is dependent on the terms of the employment contract. So make sure you check it thoroughly.

Termination and Sick Pay

Employers are often tempted to terminate the contract of an employee who’s on long-term sickness absence before their entitlement to contractual sick pay has been exhausted. I appreciate that many small businesses, in particular, may find having to pay an absent employee for months and months a huge drain on resources. But terminating a contract early means you risk having a valid claim for breach of contract or wrongful dismissal made against you. It’s essential to check the employee’s contract. If, for example, it states that he or she is entitled to three months on full pay plus three months on half pay in the event of sickness absence, a dismissal curtailing that timeframe would be in breach of contract. You could face heavy financial penalties.

Pay in lieu of notice (PILON) is a possibility, as long as you have included this in the Terms and Conditions of your employee’s contract. Also, keep in mind that if termination occurs on or after 6 April 2018, PILON is now subject to tax and NIC. Do be sure to separately label settlement agreement payments so that the tax liability can be identified.

Employment Tribunal fees and claims

Since the government stopped the court fees imposed in 2013, now deemed unlawful, there have been almost double the number of single Employment Tribunal claims. It was the trade union, Unison, who said that the fees were unfair and prevented workers from accessing justice. The Supreme Court agreed that the government was acting unlawfully.

In fact, with a total increase of 90%, multiple employment tribunal claims are up by 467%. Of the claims recently accepted, 22% were for unlawful deduction from wages, 13% were equal pay claims, 7.5% were on breach of contract and 3% were on sex discrimination. The total value of all the payments added up to £2.8 million.
Do keep a close eye on your contracts, pay scales and all other HR matters to ensure you’re fully compliant, reducing any chances of employees taking you to a tribunal.

If there’s a specific Employment Law subject that you would like more information on, do let me know. I’d be very happy to cover that in a future newsletter for you.

Register Now for the Autumn Employment Law Update Workshop

Put 25 October 2018 in your diary now!

Our next Employment Law Update Workshop is taking place on 25 October 2018. Being held in the usual place – The Meeting Room at Hennerton Golf Club in Wargrave, Berkshire – the cost is just £20 plus VAT to include refreshments, running from 9.30am to 1pm.

For more information, click here, or to go direct to our Eventbrite page and book online there.

Do You Know What the Latest Employment Law Changes Are?

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April is the time of year when certain employment law changes come into effect. It’s important to ensure that your business is up to date with legislation. This can be difficult, especially if you don’t have an HR department. Highlighted here are some current and soon to be implemented changes that might affect your business.

Pensions and Auto-Enrolment Minimum Contributions

It’s important to remind your staff that this month, there will be a mandatory increase in contributions. Employers will need to contribute a minimum of 2%, and employees 3%, providing a total minimum contribution of 5% per month.

Statutory Rates

Most years, the Department for Work and Pensions proposes new rates for statutory payment in line with the Consumer Price Index. This year, 2018, the rates are as follows:

  • Statutory Maternity Pay (SMP) – paid at a rate of 90% of the employee’s average weekly earnings for the first six weeks, the remaining 33 weeks are paid at the statutory rate (or at 90%, whichever is lower). From 1 April 2018, the statutory rate increased from £140.98 to £145.18 per week.
  • Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP) and Statutory Shared Parental Pay (ShPP) – will also increase from £140.98 to £145.18 per week.
  • Maternity Allowance – payable for those who don’t qualify for SMP payment, this will also increase to £145.18 per week.
  • Statutory Sick Pay (SSP) – as from 6 April, the rate will increase from £89.35 to £92.05 per week. You can offer more if you have a company sick pay scheme, but you cannot offer less.

The amount that your employees must earn to be entitled to these rates is also increasing from £113 to £116 per week. Employees earning less than this will not be eligible.

National Living Wage (NLW) and National Minimum Wage (NMW) rates

As from 1 April 2018, the minimum hourly rates have increased slightly to the following:

  • NLW for employees aged 25 and over increased from £7.50 to £7.83
  • NMW for those aged 21-24 increased from £7.05 to £7.38
  • NMW for those aged 18-20 increased from £5.60 to £5.90
  • NMW for those ages 16-17 increased from £4.05 to £4.20
  • NMW for apprentices aged under 19, or over 19 but in their first year of apprenticeship, increased from £3.50 to £3.70

Changes to Tax on Payments in Lieu of Notice (PILONs)

As from 6 April 2018, an element of all payments received in connection with a termination of employment are chargeable to income tax as general earnings. Whereas previously, if you didn’t have a contractual right to make a PILON, any payment made in respect of an employee’s notice entitlement was regarded as ‘damages for breach of contract’ with the first £30,000 paid tax-free, with no NICs due. For further information on this, click here.

Employment Tribunal Maximum Awards and Limits

With immediate effect, the maximum amount of a week’s pay to calculate the basic award for unfair dismissal or a redundancy payment increases to £508. The maximum amount of the compensatory award for unfair dismissal increases to £83,682.

And finally, GDPR!

With all the publicity and hype around this topic, you are probably aware that the new GDPR – General Data Protection Regulations – come into effect on 25 May. To find out more about this from an HR point of view, read my newsletter here.

If you need advice on how any of the above relates to your business specifically, I’d be delighted to help. Do call me on 0118 940 3032 or click here to email me.

Our Guide to Employment Law Changes – 1 October 2014

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On 23 October we’ll running our next Employment Law Update workshop. This half day session is aimed at business owners and managers who need to keep up to speed with the changes, to make sure they stay legal. We’ll go through all the new changes and give you the opportunity to find out how they might affect your business.

There are still some places available, so to join us at Hennerton Golf Club in Wargrave, Berkshire for just £15 +VAT, click here.

Here are a few of the changes we’ll be looking at.

Antenatal rights for fathers and partners

Working fathers will have the choice to take unpaid time off to attend up to two antenatal appointments with a pregnant partner. These rights will be available for employees who are in “qualifying relationships”, which means they:

  • are the expected child’s father
  • are the pregnant woman’s husband or civil partner
  • live with the woman in an enduring family relationship and are not a relative
  • are one of a same-sex couple who is to be treated as the child’s parent under the assisted reproduction provisions
  • are the potential applicant for a parental order in relation to a child who is expected to be born to a surrogate mother.

From 1 October both employees are permitted to take time off to attend the same appointment. However you may refuse to grant an employee time off where it is “reasonable” to do so. But you must tread carefully as employees can bring a tribunal claim against you for unreasonably refusing time off. You should adopt a clear policy of how such requests will be dealt with and the parameters for refusal.

Employment tribunals must order equal pay audits

Greater sanctions are to come into force to ensure that employers are carrying out equal pay audits. As part of a new tougher regime, employers who are found in breach of equal pay legislation can be ordered by the Employment Tribunals to carry out an equal pay audit and make the results of that audit public. If the Tribunal determines that you have unreasonably failed to comply with its obligations, it can impose a fine of up to £5,000 at each hearing, in order to address your non-compliance.

Reservists better protected against unfair dismissal

To encourage more new recruits to sign up as a reservist of the armed forces, the Government is making signing up more attractive to people who worry that enlisting might cause problems with their job and career. From 1 October 2014, the statutory qualifying period for unfair dismissal will be removed in the case of a dismissal connected with an employee’s membership of the Reserve Forces. However, reservists will still have to prove that it was unfair to dismiss them because of their absences from work – they will not be treated as automatically unfairly dismissed.

The changes will apply to employees whose effective date of termination falls after 1 October 2014. Prior to these changes, reservists were at a considerable disadvantage when pursuing a claim for unfair dismissal as a period of call-up could not count towards the two year qualifying period needed to bring a claim.

The government is also reducing the financial burden on reservists’ employers.Small and medium-sized employers will now be able to claim £500 per month (pro-rated for part-months and part-time employees working fewer than 35 hours per week) from the Ministry of Defence during periods when a reservist employee is absent on military service.  Employers will also be able to claim up to £110 a day for additional salary costs incurred in providing cover for the absent reservist.

Increase in national minimum wage

Following the recommendations of the Low Pay Commission the Government has implemented the following increases to the national minimum wage which take effect from 1 October 2014: the standard rate for those aged 21 and above will increase from £6.31 to £6.50 an hour; the rate for those aged 18-20 will increase from £5.03 to £5.13 an hour; and the rate for those above the compulsory school but aged under 18 will increase from £3.72 to £3.79 an hour.

There’s a lot more happening, so to keep ahead of the changes and to find out more about these ones, join us on our workshop on 23 October 2014.

 

How Do You Get More From Your Staff? Part Two

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In a recent blog we looked at the importance of managing performance as a way of getting more from your staff, without dramatically increasing your costs.

Here are some top tips you can actually put into action, to get more from your people:

  • Provide a stimulating working environment that encourages members of staff to contribute to the progress of your business.
  • Encourage your staff to reach their full potential by providing opportunities to develop their skills through training and development, as well as coaching in the soft skills needed to be an excellent team member.
  • Carry out formal performance reviews on a regular basis, setting clear objectives and achievable targets; don’t wait for annual appraisals.
  • Build good relationships by providing regular informal feedback and guidance; allow your staff to air their concerns within an environment of trust and honesty.
  • Deal with issues as soon as they arise – don’t wait for them to become problems.
  • Offer a clear career path, to encourage employees to be the best they can be and stay with you for the long term.

How do you get more from your people? What have you done that has worked – or not worked? Leave a reply below.

If you still have questions about how to improve the performance of your team, come to our next workshop on 22 November 2012 near Henley. Places are free but limited, so click here for full details.

Misconduct

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Despite every effort, even the best run business may encounter problems of misconduct from time to time.

Misconduct can range from a minor incidence of unsatisfactory behaviour to an act of violence, theft or malicious damage.  However, the one thing they all have in common is that if handled incorrectly they could not only damage your reputation but leave facing the prospect expensive unfair dismissal claims and employment tribunals.

It is often easier to deal with a minor incidence of misconduct informally by simply explaining to the employee why their behaviour has been deemed unsatisfactory and seeking agreement/agree steps to ensure it does not continue or recur.  However, if this does not have the desired result, or closer investigation reveals that the problem is bigger than initially thought, then it might be necessary to invoke a more formal approach. Most companies operate a 3-stage process: (1) written warning, (2) final written warning, (3) dismissal.

Avoidance is better than cure!  The key to protecting your business is to have in place a clear and fair disciplinary procedure that defines what behaviours you consider to be acts of misconduct relevant to the type of business you undertake and that this is communicated to every member of staff at the outset of employment.  The procedure should cover a range of circumstances, the different types of work performed by your employees, health and safety issues, risks to your business, timekeeping, use and care of company equipment, bullying/harassment, claiming expenses and use of email and internet.

Finally, whatever approach you take, always keep full and detailed records.  This is just as important for minor breaches as it is for acts of gross misconduct and will ensure that if the behaviour occurs or escalates you will find it easier to defend any subsequent claims of unfair dismissal and protect the reputation of your company.