EMPLOYMENT 2018 / 19

Transcription

1 EMPLOYMENT 2018 / 19 A-Z

2 This publication is not meant as a substitute for advice on particular issues and action should not be taken on the basis of the information in this document alone. This firm is not authorised by the Financial Conduct Authority (the FCA). However, we are included on the register maintained by the FCA (www. register.fca.org.uk) so that we can offer a limited range of investment services (including insurance mediation activities) because we are authorised and regulated by the Solicitors Regulation Authority (the SRA). We can provide these services if they are an incidental part of the professional services we have been engaged to provide. Mechanisms for complaints and redress if something goes wrong are provided through the SRA and the Legal Ombudsman. Bircham Dyson Bell LLP processes your personal data in connection with the operation and marketing of a legal practice and will occasionally send you information relating to the firm. If you would prefer not to receive this information or would like us to amend your contact details and/or mailing preferences, please notify us by databasecoordinator@bdb-law.co.uk. Bircham Dyson Bell LLP is a member of Lexwork International and Eureséau, two associations of independent law firms. Printed on sustainable paper.

3 INTRODUCTION The Employment Group at Bircham Dyson Bell LLP is a group within the Business Services Department, advising corporate, public, charity and individual clients on all aspects of contentious and non-contentious employment law. Our policy is one of communication rather than confrontation. We seek to avoid litigation and Court proceedings whenever possible, but undertake all Employment Tribunal and Court proceedings where disputes cannot be satisfactorily resolved or avoided. The Employment Group s strengths lie in taking a pragmatic, commercial and proactive approach to dealing with employment issues and in offering immediate and early advice to clients so as to prevent, where possible, a breakdown of the employer / employee relationship. The Employment Group, with its expert and highly trained lawyers, lectures widely on employment law issues to assist clients in educating and training their managers and executives. We also produce regular Employment Bulletins and run inhouse seminars and mock tribunals to keep clients up to date with employment law developments. While we hope that you will find the information contained in this booklet helpful, it is not meant as a substitute for legal advice on particular issues and is written in general terms. Please seek tailored legal advice from a member of the Employment Group before taking any specific action.

4 CONTENTS 1 Adoption Leave and Pay 2 Breach of Contract 3 Compensation Limits 4 Discrimination 5 Equal Pay 6 Flexible Working 7 Gender Pay Gap Reporting Obligations 8 Grievance and Disciplinary Procedures 10 Health and Safety 11 Holiday 12 Holiday Pay 14 Income Tax 16 Living Accommodation 17 Maternity Leave 18 Maternity Pay 19 National Living / Minimum Wage 20 Notice Periods 21 Options 22 Parental Leave 23 Paternity Leave 23 Paternity Pay 24 Questions 25 Redundancy Payments 26 Shared Parental Leave 27 Shared Parental Pay 27 Statutory Sick Pay 28 Time Limits for Instigating Claims 29 Time Off Work 30 Tribunal Fees 31 Unfair Dismissal 32 Vicarious Liability 32 Volunteers 33 Working Time Regulations 34 Written Statement of Employment Particulars 35 Young Persons and Children 36 Zero Hours Contracts

5 ADOPTION LEAVE AND PAY THE RIGHT Employees are entitled to 26 weeks Ordinary Adoption Leave followed by 26 weeks Additional Adoption Leave. Only one member of a couple adopting jointly may take statutory adoption leave. The other member may be entitled to statutory paternity leave and pay. Adoptive parents can also take advantage of the shared Parental Leave regime. See page S (Shared Parental Leave). From 5 April 2015 the right to statutory adoption leave and pay was extended to include surrogacy arrangements leading to a Parental Order and fostering arrangements resulting in adoption. NOTIFICATION The employee must inform the employer of their intention to take leave within seven days of being notified by the adoption agency (or as soon as reasonably practicable if this is not possible), specifying when the child is expected to be placed for adoption and when they want adoption leave to start. The employee must give 28 days notice to vary the start date of the leave (or, if that is not possible, as soon as they can). The employer must respond within 28 days confirming the expected date of return to work. STATUTORY RATE Employees who meet qualifying conditions based on length of service and average earnings are entitled to 39 weeks Statutory Adoption Pay the first six weeks of which is paid at 90% of the employee s gross average weekly earnings, followed by 33 weeks at the prescribed rate set by government each year. The prescribed rate for payments from 1 April 2018 is (increased from for period 2 April 2017 to 31 March 2018). A 1

6 B BREACH OF CONTRACT THE RIGHT For both an employer and employee to have all of the terms of the contract of employment, including notice provisions, honoured. Both express and implied terms (for example the implied duty of trust and confidence) are covered. QUALIFYING SERVICE There is no qualifying period of service required before an employee may bring a claim for breach of contract whilst still in employment or a claim for wrongful dismissal (actual or constructive) arising out of a breach of contract. However, employees seeking to claim constructive dismissal for the purposes of the statutory right not to be unfairly dismissed must generally have accrued two years continuous service. See page U (Unfair Dismissal). TIME LIMIT See page T (Time Limits). COMPENSATION LIMITS See page C (Compensation Limits). 2

7 C COMPENSATION LIMITS BREACH OF CONTRACT CLAIM Employment Tribunal (on termination of employment only) up to 25,000. Civil Courts no upper limit although a claim cannot be started in the High Court for less than 100,000. REDUNDANCY up to 14,670 for redundancies taking effect between 6 April 2017 and 5 April 2018; and up to 15,240 for redundancies taking effect between 6 April 2018 and 5 April See also page R (Redundancy Payments). UNFAIR DISMISSAL Basic award: up to 14,670 for dismissals taking effect between 6 April 2017 and 5 April 2018; and up to 15,240 for dismissals taking effect between 6 April 2018 and 5 April Compensatory award: from 6 April 2017 to 5 April 2018 the lower of either a year s salary and 80,541; and from 6 April 2018 to 5 April 2019 the lower of either a year s salary and 83,682. UNLAWFUL DEDUCTION OF WAGES No upper limit. DISCRIMINATION CLAIM No upper limit. EQUAL PAY CLAIM No upper limit. FAILURE TO GIVE WRITTEN PARTICULARS Two to four weeks pay (capped) in certain circumstances. FLEXIBLE WORKING CLAIM Up to eight weeks pay subject to the statutory limit on a week s pay ( 508 per week from 6 April 2018 to 5 April 2019) (increased from 489 for the period 6 April 2017 to 5 April 2018). 3

8 D DISCRIMINATION THE RIGHT Not to be discriminated against because of colour, nationality, national or ethnic origin, gender, marriage and civil partnership, pregnancy and maternity, race, sex, disability, sexual orientation, gender reassignment, religion or belief and age. The Government has previously committed to include caste as part of race discrimination. At the time of publication, an implementation date for this was not known although a consultation paper on this topic was published by the Government in March In any event, recent case law has found that caste discrimination can be a form of race discrimination depending on the circumstances. Discrimination claims may also be brought against named Respondents (eg fellow employees, managers or directors), as well as against the employer. QUALIFYING SERVICE There is no qualifying period of service before an employee may bring a discrimination claim. Discrimination claims can be brought by individuals even before an employment contract commences (eg resulting from discriminatory adverts or job interviews), during the employment and after the employment relationship has ended (eg arising out of the giving of discriminatory references or refusal to provide a reference). TIME LIMIT See page T (Time Limits). COMPENSATION LIMITS See page C (Compensation Limits). 4

9 EQUAL PAY THE RIGHT The Equality Act 2010 provides that men and women are entitled to equal pay for work of equal value, like work or work rated as equivalent. This includes not only basic wages or salary but also contractual benefits such as bonuses and pension contributions. Prior to 6 April 2014 workers had the right to request information from their employers via an equal pay questionnaire to help them establish whether they had received equal pay, and if not, the reasons why. A more informal process came into force on 6 April Workers may still ask questions of their employer and Employment Tribunals may take into account any refusal to respond or evasive replies despite the abolition of the formal procedure. Workers can take their cases to an Employment Tribunal where they believe that they have not received equal pay and the Employment Tribunal may use the information obtained from any questions put to the employer. From April 2017, employers with more than 250 employees must also comply with mandatory gender pay gap reporting obligations see page G (Gender Pay Gap Reporting Obligations). For a Tribunal claim for equal pay to be successful, a worker will need to compare their pay to that of someone of the opposite sex (a comparator). The comparator in an equal pay claim: must be the opposite gender to the claimant; can be either a current or previous employee, including a predecessor in the claimant s job; must be (or have been) working in the same employment ; must be actual, not hypothetical. This is a significant difference from other discrimination claims where hypothetical comparators are permitted; and does not have to provide consent to being identified as a comparator. Under the Equality Act 2010, the enforceability of pay secrecy clauses is limited. Colleagues who want to compare their remuneration packages for the purpose of finding out whether any discrimination is taking place are allowed to do this (and are protected from detrimental action if they do), even if there is a clause in the contract which seeks to prevent them from doing so. QUALIFYING SERVICE None. TIME LIMIT See page T (Time Limits). COMPENSATION LIMITS See page C (Compensation Limits). E 5

10 F FLEXIBLE WORKING THE RIGHT To make a request for flexible working (eg change in hours worked, change to times required to work or to work from home). On 30 June 2014, the right to request flexible working was extended to all employees who meet the qualifying conditions and regardless of the reasons for the request. QUALIFYING CONDITIONS Employees must have worked continuously for 26 weeks at the date the application is made. Only one application is allowed in any 12 month period. NOTIFICATION Up to 30 June 2014, a set statutory timetable to deal with flexible working requests was in operation. Since 30 June 2014, employers have had the flexibility to set their own procedures and timetables, provided any request is dealt with in a reasonable manner and finalised within three months. EMPLOYER S GROUNDS FOR REFUSAL burden of additional costs; detrimental effect on the ability to meet customer demand; inability to reorganise work amongst existing staff; inability to recruit additional staff; detrimental impact on quality; detrimental impact on performance; insufficiency of work during the periods the employee proposes to work; and planned structural changes. 6

11 GENDER PAY GAP REPORTING OBLIGATIONS The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 came into force on 6 April They require any business which has 250 or more employees at the snapshot date of 5 April to publish this data before 4 April the following year. The wider definition of employee set out in the Equality Act 2010 is used for the purposes of determining whether a business meets the threshold for reporting. The gender pay gap differs from equal pay. The gender pay gap shows the difference between the average earnings of men and women. It is expressed as a percentage of men s earnings eg women earn 25% less than men. Employers must publish: the overall gender pay gap figures for relevant employees, using both the mean and median average hourly pay; the numbers of men and women in each of four pay bands (quartiles) based on their overall pay range; information on their gender bonus gap (that is, the difference between men and women s mean and median bonus pay over a 12 month period); and the proportions of male and female employees who received a bonus in the same 12 month period. This information must be published on the Employer s website and on the government s Gender Pay Gap Data Reporting website together with a written statement signed by an appropriate person, eg the Chief Executive. Employers also have the option to a provide a narrative with their information which can explain more about the results and set out actions that they are taking to address any gender pay gap. G 7

12 G GRIEVANCE AND DISCIPLINARY PROCEDURES The Employment Act 2008 introduced a new regime for dealing with disciplinary and grievance matters and repealed the old statutory procedures under the Employment Act As part of this regime, a new ACAS Code of Practice on Disciplinary and Grievance Procedures (ACAS Code) was introduced. An updated ACAS Code came into effect on 11 March 2015, replacing the code issued in Following the ACAS Code can help avoid potential claims. If an employee s claim is successful but either the employee or the employer unreasonably failed to follow the ACAS Code, the level of compensation awarded to the employee may be affected. The main provisions of the ACAS Code are as follows: GRIEVANCES the employee should raise the grievance in writing; the employer should hold a meeting and investigate the complaint; the employee may bring a companion who should be a fellow worker or a trade union representative; and the employee has a right of appeal. DISCIPLINARY MATTERS the employer should investigate the issues; the employer should inform the employee of the issues in writing; there must be a disciplinary hearing or meeting; the employee has a right to be accompanied by a fellow worker or trade union representative of their choice; the employer should inform the employee of the decision in writing; the employee has a right of appeal; in misconduct cases, separate persons should conduct the investigation and disciplinary hearing; when informed of the problem, the employee should be provided with written evidence (eg witness statements); there is a more detailed procedure for holding a meeting with an employee (eg opportunities for witnesses to be called); there is guidance on the meaning of reasonable request to be accompanied and on what a companion is permitted to do during the hearing; only a manager with authority to do so may take the decision to dismiss an employee; and in the absence of a good reason being provided, employers must make a decision on the evidence available where an employee is persistently unable or unwilling to attend a disciplinary meeting. 8

13 GENERAL the ACAS Code does not apply to dismissals due to redundancy or the non-renewal of fixed-term contracts upon expiry although it may, in some circumstances, apply to dismissals for some other substantial reason ; the employer and employee are encouraged to use an independent third party to resolve disputes; it provides the standard of reasonable behaviour in most instances; employees and their representatives should be involved in the development of rules and procedures; there is greater emphasis on employees having to behave reasonably and consistently; and there are sections on dealing with overlapping grievance and disciplinary cases, and collective grievances. 9

14 H HEALTH AND SAFETY EMPLOYER S RESPONSIBILITIES The common law duty of an employer to have regard to the health and safety of its employees requires the employer to ensure: that employees work in a safe workplace; that there are safe systems and working practices in place to prevent risks to health; the safe usage, handling and storage of materials; that adequate first aid facilities are in place; that employees are informed about any potential hazards from the work they do, and chemicals and other substances used by the employer, and are given information, instructions, training and supervision as needed; that emergency plans are in place; that ventilation, temperature, lighting, toilet, washing and rest facilities all meet health, safety and welfare requirements; that the correct work equipment is provided, properly used and regularly maintained; that exposure to substances that may damage an employee s health are prevented or controlled; that precautions against the risks caused by flammable or explosive hazards, electrical equipment, noise and radiation are taken; that health supervision as needed is provided; that protective clothing or equipment is provided to the employee free of charge if risks cannot be removed or adequately controlled by any other means; that the correct warning signs are provided and maintained; that certain accidents, injuries, diseases and dangerous occurrences are reported to either the Health and Safety Executive or the local authority, depending on the type of business; and employers have a statutory duty under the Health and Safety at Work Act 1974 (HSWA) and related legislation to ensure the health, safety and welfare of persons at work. EMPLOYER S LIABILITY vicarious liability at common law for accidents caused by acts of employees acting in the course of their employment; and criminal and civil liability. EMPLOYER S PENALTIES improvement and prohibition notices; and criminal proceedings resulting in fines and / or possible imprisonment. 10

15 H EMPLOYEE S RESPONSIBILITIES Every employee at work has a duty under HSWA: to take reasonable care for the health and safety of himself and others at work; and to cooperate with his or her employer, or any other person, in ensuring that any requirements or duties imposed by statutory provisions on the employer are complied with. HOLIDAY THE RIGHT A full-time worker is entitled to 5.6 weeks annual leave in each leave year (ie 28 days for those who work five days a week). The first four weeks of this entitlement comes from European law, with the remainder being provided for in the UK domestic law. A part-time worker is entitled to 28 days holiday reduced pro rata, according to the number of days or hours they work each week. Employers may choose to enhance this right contractually. QUALIFYING SERVICE No minimum period of continuous service is required to qualify for statutory annual leave. A worker whose employment begins part way through a leave year has a pro rata statutory holiday entitlement for that year. NOTIFICATION Under the Working Time Regulations 1998, a worker must give notice if they wish to take statutory holiday, which must be at least twice the period of leave that they are requesting. An employer may give notice ordering a worker to take statutory holiday on specified dates. Such notice must be at least twice the length of the period of leave that the worker is being ordered to take. These notice periods may be varied or excluded by the contract of employment. REFUSAL An employer may refuse a worker s holiday request by serving a counter-notice. This must be given at least as many calendar days before the date the leave is due to start as the number of days which the employer is refusing. 11

16 H CONTRACT CONSIDERATIONS When drafting contracts of employment or other relevant agreements, employers should consider whether: workers should be required to give longer notice of intention to take holiday; holiday dates should require a manager s express (written) approval; there should be pre-set limits on the amount of annual leave that can be taken or requested in any given period (for example, no more than two weeks at a time or no more than one week in total during busy periods); and there should be specific provision for prearranged annual shutdowns. HOLIDAY PAY WORKING TIME DIRECTIVE (WTD) The European WTD requires workers to receive their normal remuneration during periods of leave derived from the WTD (ie the first four weeks of leave (pro-rated for part-time workers) in any holiday year). Following the EAT s decision in Bear Scotland, the following elements of remuneration should be included in the calculation of holiday pay for the four weeks annual leave derived from the WTD: commission payments; incentive bonuses; overtime that workers are required to perform, regardless of whether it is guaranteed; overtime premiums; payments that relate to the personal and professional status of workers, such as those based on seniority, length of service or professional qualifications; productivity / performance bonuses; shift allowances and premiums (eg additional rates for working particular shifts, such as time and a half ); standby payments and payments for emergency call-out duties; and travel and other allowances that are treated as taxable remuneration. The following elements of remuneration should not be included: benefits in kind; bonuses not linked to workers performance; expenses (including travel expenses) which reimburse workers for costs incurred; and one-off bonuses and occasional payments. 12

17 VOLUNTARY OVERTIME The EAT recently confirmed in Dudley Metropolitan Borough Council v Willetts and Others that voluntary overtime can qualify as normal remuneration for the purposes of calculating holiday pay. The EAT stated that a payment will be normal for these purposes where it is paid over a sufficient period of time on a regular basis. PAY FOR THE ADDITIONAL 1.6 WEEKS Holiday pay for the additional 1.6 weeks public holiday per year above the European WTD entitlement is calculated according to the rules in the Employment Rights Act 1996 as set out below. NORMAL WORKING HOURS Generally, a worker who has normal working hours will have their week s pay calculated with reference to those hours. This usually means basic salary, disregarding any overtime hours (except guaranteed, compulsory overtime) and without any additional bonuses, commission payments, overtime premiums or allowances. NO NORMAL WORKING HOURS If a worker does not have normal working hours, a week s pay is calculated as an average of all remuneration earned in the previous 12 working weeks. This includes any overtime payments and commission. The law relating to holiday pay is a complicated and evolving area of law and tailored advice should always be sought. 13

18 I INCOME TAX Rate Earning Bands 2017 / / 19 Saving rate limit (savings income) 5,000 5,000 20% 0-33, ,500 40% 33, ,000 34, ,000 45% over 150,000 over 150,000 DIVIDENDS In the July 2015 Budget, the Government announced that the dividend tax credit was to be abolished and replaced with a new tax-free dividend allowance. From 6 April 2018, the dividend allowance was reduced to 2,000. Dividend income in excess of this allowance will be taxed at the revised dividend income tax rates: 7.5% on dividend income within the basic rate band; 32.5% on dividend income within the higher rate band; and 38.1% on dividend income within the additional rate band. Personal Allowance / / 19 11,500 11,850 1 Personal Allowance reduces where income is above 100,000 by 1 for every 2 of income above 100,000 limit. Thus, those with an income over 122,000 do not get a personal allowance. Married Couples Allowance (at least one partner born before 2017 / / 19 6 April 1935) 2 Allowance 8,445 8,695 Minimum amount 3,260 3,360 2 Subject to an income limit of 28,900 for 2018 / 19 tax year allowance reduced by 1 for every 2 above the limit subject to the minimum amount. 14

19 Annual Allowance for Pension Saving 2013 / 14 50, / 15 40, / 16 40, / 17 40, / 18 40, / 19 40, For high income individuals, the annual allowance is tapered down to 10,000 Lifetime Allowance for Pension Saving 2013 / 14 1,500, / 15 1,250, / 16 1,250, / 17 1,000, / 18 1,000, / 19 1,030, From 6 April 2018 the lifetime allowance will be indexed, rising annually in line with the increase in CPI. National Insurance Bands 2017 / 18 Earnings per week Employee s contribution Employer s contribution Up to 157 Nil Nil % 13.8% Over 866 2% 13.8% National Insurance Bands 2018 / 19 Earnings per week Employee s contribution Employer s contribution Up to 162 Nil Nil % 13.8% Over 892 2% 13.8% 15

20 L LIVING ACCOMMODATION Some employees are provided with accommodation as part of their employment. Contracts of employment should contain a clause explaining that this is provided solely for the proper performance of the employees duties. Key issues to consider regarding this benefit are: TAX TREATMENT tax free in certain circumstances for an employee (not director) where essential for the proper performance of the employee s duties. This exemption extends to payment of Council Tax. NATIONAL LIVING / MINIMUM WAGE accommodation is the sole exception to the rule that benefits in kind do not count towards minimum pay; an employer who provides accommodation can deduct an amount from the employee s pay or can charge for the accommodation; and there is a maximum limit on the amount of deduction or charge for the purposes of whether or not the employee is paid the national minimum wage. These are as set out below: From 1 April March 2018 From 1 April March per day on which accommodation is available per week 49 per week 7 per day on which accommodation is available An employer may charge or deduct more than the maximum permitted weekly amount but the excess amount above the maximum permitted weekly amount would not count towards minimum pay. See page N (National Living / Minimum Wage) for applicable rates. 16

21 MATERNITY LEAVE M ORDINARY MATERNITY LEAVE (OML) The first 26 weeks of maternity leave is defined as OML. All employees (regardless of length of service) are entitled to 26 weeks OML during which time they are entitled to all of the contractual rights that would have been received but for being on leave, except in relation to pay. OML cannot normally commence earlier than the beginning of the 11th week before the expected week of childbirth (EWC) (unless the baby is born before that date). There is a period of compulsory maternity leave in that an employee must not work for a period of two weeks (four weeks for factory workers) commencing with the date on which her baby is born. Failure to comply with this prohibition renders the employer liable to a fine on summary conviction. There is a right to return to the same employment after OML. ADDITIONAL MATERNITY LEAVE (AML) The second 26 weeks of maternity leave is defined as AML. All employees (regardless of length of service) are entitled to 26 weeks AML (which starts on the day after the OML period finishes) and are, again, entitled to all of their contractual rights, except in relation to pay during AML. There is a right to return to the same or similar employment after AML. NOTIFICATION No later than the end of the 15th week before the EWC (or as soon as is reasonably practicable) the employee must notify the employer of: the fact that she is pregnant; the EWC; and the date she wants OML to start. The employee can change the commencement date on giving 28 days notice. EMPLOYER S RESPONSE The employer must respond within 28 days confirming the expected date of return, the assumption being that the employee takes her full entitlement to OML and AML. RIGHT TO RETURN The employee has the right to return to work at the end of AML. The employee must give the employer eight weeks notice if she wishes to return to work early, but the employer may agree to her returning on shorter notice. 17

22 M KEEPING IN TOUCH DAYS Where both parties agree, an employee can work for up to ten days during her maternity leave (provided that this is not during the compulsory maternity leave period) without losing her right to Statutory Maternity Pay or Maternity Allowance. The employer may make reasonable contact with an employee on maternity leave. SHARED PARENTAL LEAVE Since April 2015, a mother has been able to cut short her maternity leave and share the balance with her co-parent subject to meeting certain conditions. See page S (Shared Parental Leave and Pay). MATERNITY PAY QUALIFYING CONDITIONS Employees with 26 weeks continuous service ending with the 15th week before the EWC and with average weekly earnings (over a defined reference period) at least equal to the lower earnings limit for National Insurance Contributions. STATUTORY RATE OF PAY Employees who meet the qualifying conditions and give the requisite notice are entitled to 39 weeks Statutory Maternity Pay (SMP), ie six weeks at 90% of average weekly earnings, followed by 33 weeks at the lower of 90% of average weekly earnings or the flat rate of for payments from 1 April 2018 (previously for the for period 2 April 2017 to 31 March 2018). Maternity pay or benefits may be enhanced by the employer in the contract of employment. MATERNITY ALLOWANCE Employees who do not meet the qualifying conditions for SMP may still be entitled to claim Maternity Allowance from their local Social Security / Jobcentre Plus office. 18

23 NATIONAL LIVING / MINIMUM WAGE THE RIGHT Workers are entitled to be paid at least the level of the national minimum wage for every hour they work. THE RATES From April 2016, a new national living wage was introduced for workers aged 25 and over. The national living / minimum wage rates are reviewed each year, following recommendations by the Low Pay Commission. The current rates set out below are effective from 1 April 2018 to 31 March Workers aged 25 and over 7.83 per hour. Standard Adult Rate Workers aged between 21 and per hour. Development Rate Workers aged 18 to per hour. Young Worker Rate for 16 and 17 year olds 4.20 per hour*. Apprentice Rate for apprentices aged 16 to 19 or 19 or over and in the first year of their apprenticeship 3.70 per hour. Since 1 October 2009, it has no longer been possible to use tips to top up wages to meet the National Minimum Wage. N * Children of compulsory school age are not entitled to the National Minimum Wage. A child ceases to be of compulsory school age on the last Friday in June in the academic year in which he / she reaches the age of 16 or if he / she reaches 16 after the last Friday in June but before the start of the new school year. 19

24 N NOTICE PERIODS THE RIGHT An employee is entitled to receive a statutory minimum period of notice. This statutory minimum period may be enhanced by a longer contractual notice period in the contract of employment. If so, the longer contractual period of notice will apply. In the absence of express agreement, the courts may still imply a longer notice of period if reasonable to do so. NOTICE TO BE GIVEN BY EMPLOYER Length of Service Less than one month After one month After two years completed service After three years completed service After four years completed service For each subsequent completed year of service After 12 years completed service Minimum notice entitlement No notice necessary One week Two weeks Three weeks Four weeks One additional week s notice per year of service 12 weeks* * Maximum statutory notice period irrespective of additional years service. NOTICE TO BE GIVEN BY AN EMPLOYEE After one month s employment, an employee must give the employer at least one week s notice. This minimum period is unaffected by longer service but can be contractually enhanced. TAX All payments in lieu of notice (PILON) are treated as earnings for income tax and NIC purposes from 6 April 2018, regardless of the wording of the contract of employment. 20

25 O OPTIONS Employers often grant share options as a form of employee benefit. The key features of these are as follows: options are only available where the employer is a company limited by shares as they relate to shares in the company; options are usually issued as part of a scheme which entitles employees to buy a certain number of shares in the company at a certain price; the price of the shares is set at the date the options are granted to the employee; commonly the employee cannot buy the shares under the option until a fixed period has elapsed from the date it is granted usually one to three years. This is called the exercise date. This acts as an incentive for the employee to stay with the employer; and the reason the option is of benefit to an employee is that the employee can take advantage of the growth in value of the company over time. This is usually expressed by its share price. Hence, if the price of the shares on the exercise date is more than on the date of grant, the employee is paying less for the share than its current value. Many share option schemes for employees have certain tax exemptions if they are approved by HM Revenue & Customs. 21

26 P PARENTAL LEAVE THE RIGHT Employees are entitled to a total of 18 weeks unpaid leave for each child. A maximum of four weeks leave per year may be taken. Leave must only be used for the purpose of caring for a child. QUALIFYING SERVICE Employees normally must have completed one year s continuous service with their employer and have, or expect to have, parental responsibility for a child. PROCEDURES Employers and employees can agree their own procedures for taking parental leave. In the absence of any agreement, Regulations provide for a fall back scheme. WHEN PARENTAL LEAVE CAN BE TAKEN Up to the child s 18th birthday. 22

27 PATERNITY LEAVE THE RIGHT An employee has the right to two weeks paternity leave, to be taken as either a one or two week period of leave and which has to finish within 56 days of the birth of the child or the child s placement for adoption. Two separate blocks may not be taken. QUALIFYING SERVICE An employee must have been continuously employed by the employer for 26 weeks ending with the 14th week before the expected week of childbirth (EWC). In adoption cases an employee must have been continuously employed for 26 weeks ending with the week in which the child s adopter is notified that they have been matched with a child. NOTIFICATION An employee must notify the employer by the end of the 15th week before the EWC and must confirm the week the baby is due, whether the employee wants to take one or two weeks leave and when he or she wants the leave to start. In the case of adoption, notice must be given no more than seven days after the child s adopter is notified that they have been matched with a child. The employee must give 28 days notice if he or she wants to change the start date. PATERNITY PAY QUALIFYING SERVICE As above for paternity leave but, in addition, the employee must also have continuous service up to the child s date of birth (or the week the child s adopter is notified that they have been matched) and be earning at least the lower earnings limit. STATUTORY RATE OF PAY If eligible, employees are entitled to two weeks statutory paternity pay paid at the rate of for payments from 1 April 2018 (previously for period 2 April 2017 to 31 March 2018) or 90% of average weekly earnings, if lower. SHARED PARENTAL LEAVE Since April 2015 an employee taking advantage of the Shared Parental Leave regime may be able to share some of their partner s maternity leave and pay subject to certain conditions being met. See page S (Shared Parental Leave and Pay). P 23

28 Q QUESTIONS As of 6 April 2014, the statutory questionnaire procedure in relation in relation to discrimination and equal pay claims was abolished. Employees are still able to ask questions of their employer but this is on an informal basis and there is no obligation on the employer to respond. ACAS has published good practice guidance on how employers should deal with questions regarding discrimination in the work place. This guidance is non-binding and adverse inferences will not automatically be drawn from a failure to respond to questions. Nevertheless, tribunals may still take into account whether and how an employer has responded to any relevant questions as part of the evidence in a case. They may also order an employer to answer questions in the course of proceedings. There is no longer a deadline for replying to questions, but the ACAS guidance states that employers should deal with questions seriously and promptly. Employers should be aware that if they do not answer questions, employees may seek out information by other routes such as a data subject access request under the General Data Protection Regulation from 25 May

29 R REDUNDANCY PAYMENTS QUALIFYING PERIOD Two years continuous employment. CALCULATION The amount of any statutory redundancy payment is calculated with reference to the employee s age, length of service and weekly pay (see below). An online calculator is available at AGE for service where the employee is over 41, the factor is one and a half week s pay per full year worked; for service between the ages of 22 and 40, the factor is one week s pay per full year worked; and for service under the age of 22, the factor is half a week s pay per full year worked. SERVICE No more than 20 years service, in any category above, may be counted. WEEKLY PAY The lower of a week s actual pay or weekly pay capped at a maximum of 508 (from 6 April 2018 increased from 489 for the previous tax year). Employers may offer enhanced redundancy pay. The first 30,000 of any redundancy payment can usually be paid to an employee free of tax and National Insurance contributions, however amounts over 30,000 are subject to income tax but not National Insurance contributions. Employer s National Insurance contributions will be payable on amounts over 30,000 from 6 April

30 S SHARED PARENTAL LEAVE THE RIGHT Since April 2015, subject to meeting eligibility criteria, a mother or primary adopter can opt to end their maternity or adoption leave (except for the compulsory two weeks maternity leave) and share their remaining entitlement with their co-parent. Shared Parental Leave (SPL) can be taken by the parents consecutively or concurrently. Employees wishing to exercise their right to SPL must give their employer notice of their intention to do so, including the start and end dates of each period of leave, eight weeks prior to the start of the first proposed period of leave. Employers who receive such notice are entitled to ask for evidence, such as a birth certificate or a copy of the notice of adoption. ELIGIBILITY Births: a mother who is entitled to statutory maternity leave, statutory maternity pay or maternity allowance. Adoption: a primary adopter who is entitled to statutory adoption leave or statutory adoption pay. One of the co-parents must have been economically active (ie they must have worked in an employed or self-employed capacity earning, on average, at least 30 a week) for at least 26 out of the 66 weeks immediately before the expected week of childbirth, or the week in which the primary adopter was notified of their match with a child. ADDITIONAL RIGHTS Parents who opt in to SPL are also entitled to additional rights and protections: reasonable contact during the period of SPL and the option to work up to 20 days during SPL without bringing their leave to an end; additional redundancy protections; a right to return to work; and protection from detriment as a result of taking SPL. 26

31 SHARED PARENTAL PAY QUALIFYING CONDITIONS To qualify for Shared Parental Pay, an individual must be an employee and one of the following must apply: he / she is eligible for Statutory Maternity or Adoption Pay; and he / she is eligible for Statutory Paternity Pay and his / her partner is eligible for Statutory Maternity or Adoption Pay. Workers who are eligible for Statutory Maternity or Paternity Pay also qualify. STATUTORY RATE OF PAY Shared Parental Pay is paid at the rate of (from 1 April 2018 previously for period 2 April 2017 to 31 March 2018) or 90% of weekly earnings if lower for up to the balance of the 39 week period of paid leave not taken by the mother or primary adopter. STATUTORY SICK PAY THE RIGHT Statutory Sick Pay (SSP) is payable to most employees for a maximum of 28 weeks in any three year period. SSP is only payable for Qualifying Days (usually the days on which the employee normally works) and is not payable during the first three days of illness (unless the absences are linked). QUALIFYING PERIOD None. CALCULATION AND RATE OF SSP Eligibility is subject to the employee s average weekly earnings (before deductions). The lower earnings limit is 116 or more per week for the 2018 / 19 tax year. The current SSP rate is per week from 6 April 2018 to 5 April Employers may offer contractually enhanced sick pay. S 27

32 T TIME LIMITS FOR INSTIGATING CLAIMS BREACH OF CONTRACT Three months from effective date of termination for Employment Tribunal claims up to 25,000 in value. Six years from the date of breach of contract in Civil Courts. REDUNDANCY PAYMENT Six months from effective date of termination. UNFAIR DISMISSAL Three months from effective date of termination. UNLAWFUL DEDUCTION OF WAGES Three months from the date of the last deduction (or the last such deduction if there is a series of them). Each deduction must, of itself, be within three months of any prior deduction in the same series. DISCRIMINATION CLAIM Three months from the act of discrimination (or the last such act if there is a series). EQUAL PAY At any time during the employment to which it relates, or, if the employment has been terminated, within six months of the effective date of termination. Note The Employment Tribunals have the discretion to extend the above time limits in certain circumstances, however, they never have this discretion in equal pay claims. Additionally and before bringing a claim in the Employment Tribunal, a prospective Claimant must first go through the ACAS Early Conciliation Process, the effect of which is to extend the time limit in which a claim must be brought. The precise length of the extension is fact-specific to each case and advice should be sought in all cases as to when a time limit expires. 28

33 TIME OFF WORK ANTENATAL CARE All pregnant employees are entitled to time off, with pay, to attend antenatal appointments. Since 1 October 2014 partners of pregnant women and fathers of expected children have also had the right to take unpaid time off to attend up to two antenatal appointments with the mother. CHILDREN Employees have various rights to time off to care for their children. See pages A (Adoption Leave and Pay), M (Maternity Leave and Pay), P (Parental Leave), P (Paternity Leave and Pay) and S (Shared Parental Leave and Pay). DEPENDENTS All employees are entitled to reasonable time off work without pay to deal with an emergency involving a dependent. There is no qualifying period for this right but the scope of what is an emergency and who is a dependent is tightly defined. PUBLIC DUTIES An employer is obliged to allow employees to take a reasonable amount of time off work to perform certain public duties (defined by legislation). The time off work is without pay. There is no qualifying period for this right. TRADE UNION DUTIES An employee who is an official of an independent trade union recognised by the employer is entitled to reasonable time off work, with pay, during working hours to carry out certain trade union duties in his or her capacity as such an official. An employee who is a member of the union is also entitled to reasonable time off work, without pay, for certain trade union activities. SAFETY REPRESENTATIVES Employees who are safety representatives are entitled to time off, with pay, to carry out their duties and to undergo training. OCCUPATIONAL PENSION SCHEMES Employees who are trustees of such schemes or directors of pension trustee companies are entitled to reasonable time off work, with pay, to carry out their duties or receive training for such duties. EUROPEAN WORKS COUNCILS An employee who is a member of a European Works Council, a member of a special negotiating body, an information and consultation representative or a candidate for election as such a representative is entitled to time off, with pay, for performance of related duties. T 29

34 T EMPLOYEE REPRESENTATIVES Employees who act as representatives for consultation about redundancies or business transfers are entitled to reasonable time off work, with pay, during working hours to perform these functions and to undergo appropriate training. REDUNDANCY An employee who has been employed for more than two years and who is being dismissed by reason of redundancy is entitled to reasonable time off, with pay, during his or her notice period to look for another job. TRAINING Employees working for employers with 250 or more employees have a right to request unpaid time off work for study or training. Employees must have completed 26 weeks employment and the training should improve both effectiveness at work and performance of the employer s business although it need not lead to a formal qualification. TRIBUNAL FEES With effect from 26 July 2017, Employment Tribunal fees were abolished with immediate effect following the decision of the Supreme Court in R (on the application of Unison) v Lord Chancellor. All claims following that date do not require a fee to be paid. The Government is now operating a scheme to reimburse Employment Tribunal and Employment Appeal Tribunal fees which were paid after their introduction on 29 July 2013 until the scheme was abolished. As well as being refunded their original fee, successful applicants will also be paid interest of 0.5%, calculated from the date of the original payment up until the refund date. Applicants can apply for a refund using the Employment Tribunals online service. Alternatively, to make an application by paper or , applicants will need to complete and return the applicable form to HM Courts and Tribunals Service England and Wales, or Scotland, as appropriate: Form 1-C if the applicant made the claim on his / her own and paid the fees; Form 3-S if the applicant paid the fees for someone else to make the claim or was the lead claimant in a joint (multiple) claim; or Form 2-R if a claim was brought against the applicant and the applicant was ordered to pay someone s fees, or if the applicant paid any other fees to the tribunal. Further information is available from HM Courts and Tribunals Service. 30

35 U UNFAIR DISMISSAL QUALIFYING PERIOD An employee must normally have two years service before being able to claim unfair dismissal (see examples of exceptions below). TIME LIMIT See page T (Time Limits). COMPENSATION LIMITS See page C (Compensation). EXCEPTIONS TO QUALIFYING PERIOD dismissal related to certain trade union membership, activities or recognition or for taking part in protected industrial action; dismissal for asserting certain statutory employment rights; dismissal related to certain health and safety grounds; dismissal for reasons connected with pregnancy, childbirth or statutory maternity, paternity, adoption, parental, shared parental or dependent care leave; dismissal in connection with an application for flexible working or time off for training; dismissal related to employee performing duties as an occupational pension scheme trustee; dismissal related to national living / minimum wage; dismissal for exercising right under Working Time Regulations 1998; dismissal for making a protected disclosure; dismissal for performing a role as an elected employee representative; dismissal for reasons relating to working tax credit; dismissal of a shop worker or betting worker for refusing to work on a Sunday; dismissal related to the exercise of the right to be accompanied at a grievance / disciplinary hearing; dismissal for performing duties relating to information and consultation between employers and employees or in connection with European Works Council activities; dismissal related to status as a part time worker or fixed term employee; dismissal on grounds related to jury service; dismissal for reasons related to a prohibited list (regarding trade union membership); dismissal for exercising a right to participate in education or training under the Education and Skills Act 2008; dismissal for (or related to) political opinions or affiliation; or dismissal following selection for redundancy on any of the aforementioned grounds. 31

36 V VICARIOUS LIABILITY KEY ISSUES common law liability of employer for acts committed by employees during the course of employment; employer can also be liable for certain acts outside the workplace, such as harassment at work-related functions or parties; some acts of vicarious liability arise automatically, for example under the various pieces of discrimination legislation; the provisions under the Equality Act 2010, concerning vicarious liability of employers for the actions of third parties who discriminate against or harass their employees on more than two occasions were repealed from 1 October 2013 and so are no longer in force from that date; and a defence may be established if the employer can show that it has taken reasonable steps to prevent the act from occurring. EMPLOYERS SHOULD organise training and workshops for senior managers; have in place clear policies, eg equal opportunities and harassment and bullying policies; and deal firmly, consistently, promptly and lawfully with offending employees. VOLUNTEERS Volunteers are not expressly referred to or excluded from employment legislation save that a true volunteer is not entitled to receive the national minimum wage. A true volunteer, however, has few employment rights. Volunteers may, however, be protected by the nondiscrimination legislation (see page D Discrimination) depending on the facts. It is necessary, therefore, to consider the factual nature of the relationship with a volunteer to determine their status. Key factors which a Tribunal will consider in determining the status of a volunteer (and which may convert their status to that of employee or worker) are: mutuality of obligation to accept or provide assignments; personal service; written documentation; set hours and / or performance criteria; the degree of control exercised over the volunteer; similarity of work when compared to employees / workers; remuneration or benefits in kind; and the provision of training. 32

37 WORKING TIME REGULATIONS THE RIGHT The basic rights and protections provided by the Working Time Regulations 1998 are: a limit of an average of 48 hours a week (calculated over a 17 week reference period); a right to 11 hours uninterrupted rest each day; a right to 24 hours uninterrupted rest each week (or 48 hours per fortnight); a right to a 20 minute rest break if the working day lasts longer than six hours; a limit of an average of eight hours work (in 24 hours) which night workers can be required to work; a right to 28 days paid annual leave for a full-time worker (this can include the usual statutory public and bank holidays); and a right to free health assessments for night workers. Young workers have greater entitlements to rest breaks than adult workers. ENFORCEMENT Employment Tribunal; Health and Safety Executive; or Local Authority (Environmental Health Officers). OPT OUT It is possible to opt out of some, but not all, of the above rights. W 33

38 W WRITTEN STATEMENT OF EMPLOYMENT PARTICULARS This must be issued to employees within two months of commencing employment. Any changes must be notified to the employee at the earliest opportunity and not later than one month after the change. The written statement is often covered in a written contract and must contain: names of employer / employee; date when employment began; date when employee s period of continuous employment began; the level of remuneration and pay intervals; hours of work; holiday entitlement; sickness and incapacity details; details of pension scheme; notice provisions (for employer and employee); a job title or brief job description; if the position is not permanent, the duration of employment; the place of work (or indication of the places where employee may be required to work); details of any collective agreements which affect the employment; details of any work abroad (lasting for more than one month); and details of applicable grievance / disciplinary procedures (see page G Grievance and Disciplinary Procedures) including details of the person to whom they should appeal against a disciplinary decision / apply for redress of a grievance. 34

39 Y YOUNG PERSONS AND CHILDREN DEFINITIONS Child Person not over compulsory school age. School Leaving Age In England and Wales a person is no longer of compulsory school age after the last Friday in June of the school year in which their 16th birthday occurs. Young Person Person who has ceased to be a child but is under the age of 18. NATIONAL MINIMUM WAGE See page N (National Living / Minimum Wage). RESTRICTIONS with limited exceptions, no child may be employed (whether paid or unpaid) if he or she is younger than 14. Bye-laws can reduce this to 13 in certain cases; light work only for children; restrictions on times, hours and sustained periods when children and young persons may work; no child may be employed in an industrial undertaking unless it is one in which members of the same family work; special provisions with regard to children working in sport, advertising, modelling or entertainment; detailed risk assessment before employment of young person commences must be undertaken; and time off for young people to train or study must be allowed. 35

40 Z ZERO HOURS CONTRACTS KEY FEATURES Until recently there was no legal definition of a zero hours contract. However, a zero hours contract is now defined as a contract of employment or other worker s contract under which: the undertaking to do or perform work or services is an undertaking to do so conditionally on the employer making work or services available to the worker; and there is no certainty that any such work or services will be made available to the worker. Thus, a zero hours contract essentially arises where there is no obligation to provide any specific amount of employment, but an obligation exists to undertake work for the employer when it is provided. In essence, the employer simply pays the employee for work done. Zero hours contracts are also sometimes known as umbrella contracts. USES bank staff; and retail and hospitality sectors. Zero hours contracts are not confined to employees and may also be used for casual workers, where there is no obligation to undertake work offered. POINTS TO NOTE holiday pay entitlement arises this pay should be calculated as an individual entitlement as rolled up holiday rates are no longer permitted; sick pay entitlement arises; and a casual worker may claim that he or she has sufficient continuity of service to claim statutory employment rights as an employee under an overriding umbrella contract if work is undertaken regularly. SPECIFIC PROTECTIONS exclusivity changes in zero hours contracts are unenforceable; automatic unfair dismissal protection where the reason or principal reason for dismissal is breach or purported breach of an exclusivity clause; and protection from detriment because of breach or purported breach of exclusivity clause. 36

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