HR Breakfast Seminar Employment Law Update

1. HR Breakfast SeminarEmployment Law Update TPP Not for Profit and Julie Fewtrell, HR Consultant Tuesday 29 March 2011

2. Topics • Recent changes in employment law • Future changes • Proposed and potential changes • Any questions

3. Recent changes in employment law

4. Minimum Wage Increases • Oct each year • New hourly rates dependent on age: Between 16 and 17 years: £3.64 Between 18 and 21 years: £4.92 Over 21: £5.93 (5.93 for a 35-hour week = £10,792.60) Apprentices entitled to NMW from Oct 2010 and adult rate of £5.93 at aged 21 (not over 21)

5. Redundancy Pay • From 1 Feb 2011: weekly rate of pay, for calculation purposes, rises from £380 to £400 • New maximum is £12,000 • Case law: employee has right to know reasons for awarding their scores in a selection process

6. Statutory Maternity/Adoption/Paternity Pay Increase in rates: • Currently £124.88 per week • Changing to £128.73 from 6 April 2011

7. Discipline and Grievance • Situation sometimes arises whereby an employee is summoned to a disciplinary hearing and submits a grievance before the meeting takes place or during the process, as a counter to the disciplinary • Case law: the two processes can be combined into one meeting if substance is the same

8. Equality Act Purpose: Instead of having several different acts covering different areas of discrimination (and in different ways), there is now one Equality Act covering all “protected characteristics”. Equalising the “cover” provided, to a large extent.

9. Protected characteristics • Age • Disability • Gender reassignment • Marriage and civil partnership • Pregnancy and maternity • Race • Religion or belief • Sex • Sexual orientation

10. Came into effect on 1 October 2010 but not all aspects implemented. Highlight four areas today: • Recruitment • Disability discrimination definition • Third party harassment • Discrimination by association

11. Recruitment – do’s and don’ts Don’ts • Cannot ask questions about health before an offer is made • Application form cannot ask about number of days off sick or any health-related questions

12. References can only ask about health and time off sick if they are sent after an offer has been formally made • Even more critical that equal opportunities monitoring forms are detached from the rest of the form before shortlisting takes place

13. Do’s • Prior to interview, can ask if any adjustments are needed for attending interview/carrying out any tests • Offer can be conditional on a satisfactory medical or medical questionnaire

14. Think carefully when putting together the Person Specification, ensuring you cover any key physical or mental requirements of the job • Questions can be asked about an interviewee’s ability to perform essential parts of the job – but ask all of them • Tests are fine if they are relevant to the job • Check policy

15. Disability Discrimination Definition Definition: a person has a disability if they have a physical or mental impairment which has a substantial and long term adverse effect on their ability to carry out normal day to day activities.

16. No longer necessary to consider specific listed capacities • “Substantial effect” means an effect which is more than minor or trivial

17. Disabled employees: • are no longer required to establish that their treatment is less favourable than that experienced by other employees; • must simply establish that they have experienced unfavourable treatment; • and that this is because of something connected with their disability.

18. Employers can still defend such claims if they did not know, and could not reasonably be expected to know, that the employee was disabled, or if they can establish that the treatment was a proportionate means of achieving a legitimate aim.

19. Tribunals will have to consider the legitimacy of any business objectives, if they have been met in a fair, balanced and reasonable way, or could reasonably be expected to have achieved them by less discriminatory methods. • Less stringent test than in the past and it is expected that it will be easier for such claims to succeed.

20. Duty to make reasonable adjustments remains in place: “duty to take reasonable steps to avoid a substantial disadvantage to a disabled person as a result of the lack of an auxiliary aid by providing an auxiliary aid”.

21. Third Party Harassment Until now, employers could be held liable for the sexual harassment of their employees by a third party, eg someone outside their organisation.

22. Act extends liability to all “protected characteristics”* where employer has failed to take reasonable steps to prevent it – and provided they know it has happened on at least two prior occasions. * (except pregnancy/maternity and marriage/civil partnerships)

23. Discrimination by Association • This is defined as direct discrimination against someone because they associate with another person who possesses a protected characteristic. • Case law (Attridge law vs Coleman) has led to this: legal secretary claimed she was forced to quit after taking time off to care for her disabled child. She claimed constructive dismissal and disability discrimination by association.

24. Now covers these protected characteristics: • Age • Disability • Gender reassignment • Sex

25. In addition to the following, which were already covered: • Race • Religion or belief • Sexual orientation

26. What didn’t happen • Duty on public bodies to reduce socio-economic disadvantage when taking strategic decisions • Dual discrimination claims • Gender pay gap information • Positive action in recruitment and promotion (from April 2011) + other areas not related to employment law

27. Positive action in recruitment and promotion: • Gives employers the option, when faced with two or more candidates who are “as qualified” as each other, to choose a candidate from a group that is under-represented in the workforce.

28. Not the same thing as positive discrimination which is unlawful under European law • It does not mean allowing “quotas” or giving someone a job just because they have a particular protected characteristic • Provision is not mandatory so employers will not have to take positive action if they do not wish to

29. Future changes in employment law

30. Right to request flexible working From 6 April 2011, this was to be extended to parents with children under 18 years of age. On 18 March 2011, BIS announced that this will not happen.

31. Pensions: Auto-enrollment • Pensions Act 2008 • National Employment Savings Trust • Introduced from 2012 – smaller organisations from 2014 • Fully phased by 2016 • For details of when your organisation needs to implement this, go to: www.pensionsadvisoryservice.org.uk

32. Those not in a workplace pension scheme will be automatically enrolled into their employer’s scheme or this new savings vehicle – but can choose to opt out • Opt out must be in writing • Employer has to offer one or the other

33. Employer contribution: 3% • Employee contribution: 4% • Government (via tax relief): 1% Employers will not have to auto-enroll staff until they have 12 weeks’ service – to ease administrative burden where temporary/short term staff employed.

34. Maternity/Paternity/Adoption“Additional Paternity Leave”APL • Work and Families Act 2006 (subsequent amendments) • Legislation from April 2010 • Takes effect for parents of babies due from 3 April 2011 or notified of a match • Option for fathers/partners of mother to take up to 26 of the 52 weeks as paternity leave, if mother returns to work

35. APL cannot be taken before 20 weeks after birth/adoption • APL must be between 2 and 26 weeks, taken in complete weeks and as one period • Gaps between maternity/adoption leave and APL will be permitted – does not have to run consecutively

36. Father/partner can take second half of maternity leave only • Receives same pay that member of staff on maternity or adoption leave would receive – statutory or enhanced, depending on policy • Both partners entitled to 10 KIT days each • Increase of statutory maternity pay from 39-52 weeks is still under review

37. Practical points: • Update your policy • Legislation sets out various timescales and deadlines, plus administrative requirements by employers and employees • See www.businesslink.gov.uk for full details

38. Time off for training • Apprentices, Skills, Children and Learning Act 2009 • Since 6 April 2010, employees of organisations of 250 or more had the right to request time off for training which they believed would make them more productive at work • Extension to all size of employer due from April 2011 but on hold at present

39. If it comes in........ • Must have 6 months’ service • Requests must be considered seriously • Employers can refuse for sound business reasons • Similar arrangements to the existing right to request flexible working for certain categories of employee • No requirement for an employer to pay for the training or time off

40. Parental Leave • Currently 13 weeks during first five years of child’s life – unpaid • In December 2009, European Council extended this to 4 months per parent, per child • It remains unpaid • Likely to be implemented from early 2012 but our government is also reviewing all family friendly rights as a package

41. Childcare Vouchers • From 6 April 2011 • Higher rate taxpayers who sign up after this date receive tax and NI relief on up to £28 per week (£124 per month) only • At present, all can get relief on up to £55 (£243). In future, only lower rate tax payers, and higher rate taxpayers who are already in their employer’s scheme, can get this amount of relief.

42. Default retirement age • Age discrimination legislation in 2006 made default retirement age of 65 – for men and women • New government has confirmed that default retirement age will be abolished as of 1 October 2011 • Employer must give notice of intended retirement date, and employee’s right to stay on, before 6 April 2011.

43. Notice must be given 6-12 months before intended date of retirement • Retirement need not take effect before 1 October 2011. • Effectively, it will be possible to specify an intended retirement of 5 April 2012, if maximum 12 months’ notice of intention to retire is given on last possible date, ie 5 April 2011.

44. Employee must have reached age 65 before 1 October 2011.

45. Practical issues: • What happens to pension arrangements for those staying on after 65? • If you provide life assurance, will your policy continue the benefit, and if so, for how long? • Likewise with Permanent Health Insurance

46. Performance management will become critical – are managers equipped and trained? • Can you justify a retirement age for all or some of the posts in your organisation? • Documentation will need to be changed: - contracts - policies

47. Data protection breaches • Since April 2010, Information Commissioner has had powers to impose fines of up to £500,000 for serious breaches • Some have already been made, eg sending fax with confidential information to wrong addressee, losing sensitive data • Ensure your staff are familiar with, and understand, your DP Policy

48. Bribery Act • Was due to come into force in April 2011 but pushed back until three months after final version of guidance has been published • Will mean that Britain has the toughest anti-corruption legislation in the world • Penalty for breaching this – up to 10 years’ imprisonment

49. Suggest you do a risk assessment on this area, if not already doing so • Employers need to set out procedures to demonstrate they are doing all they can to prevent bribery and corruption in their workplace

50. What are the offences? • Bribing another person – offering, promising or giving a reward to induce a person to perform a relevant function or activity improperly. • Being bribed – the accepting of, agreeing to accept or requesting of a reward in return for performing a relevant function or activity improperly.