Employment Law Update 2
| Published: 21st March 2008 16:10 |
Supplied by HancocksSolicitors - Employment Law Specialists
INCREASE IN STATUTORY PAYMENT & NATIONAL MINIMUM WAGE RATES
A reminder that the following increases are due to come into effect as from 6 April 2008:
• Statutory sick pay increases from £72.55 to £75.40 per week.
• Statutory maternity/paternity/adoption pay will rise to £117.18 per week, up from £112.75.
• The National Insurance lower weekly earnings limit has increased by £3 per week to £90.
In addition, the Government has already announced increases to the national minimum wage, effective as from 1 October 2008:
Age Band 2007/08 Hourly rates 2008/09 Hourly rates
22+ £5.52 £5.73
18 - 21 £4.60 £4.77
16 - 17 £3.40 £3.53
EXPIRED WARNINGS CAN BE TAKEN INTO ACCOUNT IN DISMISSAL DECISIONS
The Court of Appeal (CA) has recently held that an employer can take into account an expired disciplinary warning when considering whether to dismiss an employee.
In the case of Airbus UK Ltd v. Webb, Webb had previously been issued with a final written warning for misuse of company time, which was to remain on record for a period of twelve months.
A month after the warning expired Webb, together with several colleagues, was found watching television when they should have been working. Whilst Webb was dismissed, his colleagues, all of whom had clean disciplinary records up to that point, received only written warnings.
The CA, in overturning the decision of both the tribunal and the Employment Appeal Tribunal (EAT), upheld the decision to dismiss as fair, stating that the misconduct itself was the principal reason for dismissal and the expired warning had been only a factor in reaching the decision. After a disciplinary warning has expired it cannot stand alone as a reason for dismissal, but the misconduct itself can be considered when determining whether to dismiss an employee for any subsequent offences.
Although this is positive news for employers, caution must always be exercised when contemplating dismissal as the CA also emphasised that such situations would be the exception rather than the rule. Employers must therefore be clear that a reason to dismiss does, in fact, exist in its own right and that the expired warning is not being relied upon too heavily to justify dismissal.
MOBILITY CLAUSES CAN REDUCE REDUNDANCY COSTS
In the recent case of Home Office v. Evans, rather than making a number of immigration staff redundant from their posts at the Waterloo Eurostar terminal, the Home Office instead decided to rely on a contractual mobility clause in order to move them to alternative employment at other locations.
In line with his contract which included a mobility clause clearly stating that he could be transferred to any civil service post in the UK or abroad, Evans was informed that he was to be moved back to Heathrow, his previous place of employment.
Evans argued that the Home Office was in breach of contract having deliberately invoked the mobility clause to avoid having to pay out redundancy costs and, as such, he had been constructively dismissed.
The CA, when considering whether the Home Office had been contractually entitled to rely upon the mobility clause, found that it had, overturning the tribunal's earlier decision. It held that the redundancy policy did not override the express mobility clause.
This decision highlights that, where there is a clear, well drafted and contractual mobility clause, employees who would otherwise be redundant can be required to relocate as long as the employer can offer them suitable alternative employment.
However, employers will not be allowed to use such clauses in a capricious or unjustified way simply in order to save redundancy costs. To avoid successful claims of breach of contract and constructive dismissal, careful consideration must therefore be given in drafting a mobility clause in order to make it legally enforceable and more acceptable to employees.
CAN EMPLOYEES BENEFIT FROM PAID HOLIDAYS WHEN OFF SICK?
Currently under UK law, a worker who is absent due to sickness is not entitled to take paid statutory annual leave during the period of absence. In Stringer and others v. HMRC, the CA held that the right to take holidays is the right to a break from active periods of work, which cannot apply whilst an individual is off sick.
The CA also stated that an employee who has been absent due to ill-health throughout the entire holiday year prior to the termination of employment, would not be entitled to any payment in lieu of untaken holiday. However, those who were absent for only part of the holiday year would be entitled to receive payment for any annual leave accrued during the period of attendance at work.
On appeal, the House of Lords referred a number of questions to the European Court of Justice (ECJ), which the Advocate-General (AG) has recently considered. In contrast to the UK view, the AG held that holidays do continue to accrue for workers on long-term sick leave, although they cannot take, or be paid for, them during the period of absence. However, if the individual does not return to work during the current holiday year, they must be permitted to carry the accrued days over to the following year.
Even more controversially, she also stated that where employment is ultimately terminated, the worker will be entitled to a payment in lieu of accrued leave, regardless of whether the individual was absent for a part or the whole of the holiday year, which must be paid at the normal rate of pay (not the amount of any sick pay the employee was receiving during the period of absence).
Although this may sound warning bells for employers, the ECJ is not due to deliver its final judgment for another six months and is not obliged to accept the opinion of the AG in any event. However, should it choose to do so, employers will consequently have to review their annual leave policies in cases of long-term sickness and possibly also maternity.
REDUNDANCY - RECRUITMENT FOR ANY NEW POST MUST BE FAIR
In Ralph Martindale & Co Ltd v. Harris, the employer decided to remove a layer of management due to an economic downturn, affecting Harris and a second manager. At the same time, a new post was advertised internally, for which both managers applied, in addition to a third candidate.
Following a basic selection process, Harris was not offered the position and was subsequently successful at tribunal in claiming unfair dismissal, a decision which was upheld by the EAT.
The tribunal stated that the vacancy should not have been opened up to the entire workforce until the two individuals who were at risk of redundancy had been fully considered for the role. In addition, it held that the selection process for recruitment had been unfair, as the decision had been largely based on the subjective view of the group director. The EAT later agreed that the tribunal had been entitled to consider the reasonableness of the recruitment procedure in determining whether the dismissal had been fair.
As redundancy is a potentially fair reason for dismissal, it has always been essential that employers follow a fair procedure in handling such dismissals. It is now clear, however, that this extends to the selection of employees for any available alternative employment, ensuring that vacancies are initially only opened up to those at risk of redundancy before other candidates, and also adopting fair objective criteria when making selection decisions.
NEW RULES ON ILLEGAL WORKING
Last month saw new rules on illegal working come into force, with the Asylum and Nationality Act 2006 bringing in more severe civil and criminal penalties for employers who negligently or knowingly employ an illegal worker.
Although employers were already obliged under the earlier legislation to carry out basic document checks on an individual's entitlement to work in the UK, they must ensure they now meet their increased responsibilities in line with updated guidelines set out by the Border & Immigration Agency.
Listed documents must be checked for validity, copied and held on file for at least two years after the period of employment ends. In addition, for migrant workers with time-limited leave to remain in the UK, the employer must carry out further checks on at least an annual basis to ensure the individual's immigration status remains valid.
Employers should provide up to date training for all staff involved in the recruitment of employees, and ensure that document checks are completed as part of a standard procedure for every new recruit, not just for foreign nationals, to avoid possible claims of discrimination.
Assistance is available to employers through the government's "employer checking service" in cases where there are concerns about the validity of a document, and more information regarding the new rules is available from http://www.bia.homeoffice.gov.uk/.
REFERENCES - THE RIGHTS AND WRONGS
The decision whether to provide references for ex- or soon-to-be ex-employees has always been a controversial and concerning issue for employers. With fear of possible claims such as negligence, malicious falsehood or defamation, why would you willingly choose to provide a reference, particularly as there is no legal obligation to do so?
Well, you may wish to help your former employee in securing a new position, either because they deserve to move on to something better, or because you need them to find a new job in order to mitigate any potential losses that they might otherwise be able to claim from you at tribunal!
Although it is undoubtedly safer to adopt the policy of not providing references, if you decide to do so, ensure that it contains only factual information, such as confirming start/end dates of employment, job title, periods of sickness/parental leave etc. Avoid commenting on the employee's performance in the role or investigations into alleged misconduct.
Also be aware that simply adding in a clause disclaiming any liability in providing the reference will not afford you any meaningful protection. The best protection is sticking to the basic facts of the individual's employment.
Whether you choose to provide references or not, you must be consistent in your approach. If you do not provide references as a rule, do not suddenly make an exception for one person simply because you liked them - this could leave you open to potential claims of discrimination.
On the other side of the coin, as the prospective employer it may be worth a try, depending on the role, to obtain references as part of your selection process. Although there are many sophisticated selection tools available these days, or no matter how good a judge of character you are, potential employees will always be on their best behaviour and tell you what you want to hear during an interview. It may therefore be very beneficial to contact a former employer to try and establish how effective the employee will be in your organisation.
If you decide to take up references as part of your selection procedure, ensure that you base the offer of employment upon the satisfactory receipt of such references and clearly highlight this condition to the employee, particularly if you allow them to join sooner. If you are subsequently provided with a poor reference, it will be straightforward to terminate employment with immediate effect.
©2008 hancocks solicitors|15 Wheeler Gate| Nottingham | NG1 2NA |
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