HR Solutions 10th Year Anniversary Employment Law Update

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Employment Law Update presentation provied by Carol Ann Guilford and Greg Guilford of HR Solutions.

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  • For years it has been assumed that there will come a time when as an employer you can dismiss your employees simply because of their age. Before age discrimination law came into force, those over retirement age had no right to complain of unfair dismissal. Under age discrimination law this was replaced with “retirement” as a potentially fair reason for dismissal and excluded from age discrimination law provided that the complex retirement procedures were followed. If the employer followed the procedure, the employee had no right to complain that they had been dismissed on retirement. As of October 2011, this old assumption will no longer apply. Age alone will not be a reason for dismissal, except perhaps for a few exceptional cases such as the emergency services.
  • Employers will only be able to operate a compulsory retirement age if it can be objectively justified. In order for the retirement to be considered justified, its aim must be both ‘legitimate’ and ‘proportionate’.  
  • ‘ Proportionate’ means that:   what the employer is doing is actually achieving its aim the discriminatory effect should be significantly outweighed by the importance and benefits of the legitimate aim, and the employer should have no reasonable alternative to the action.   An aim could be ‘legitimate’ if, for example, it relates to:   the health, safety and welfare of the individual concerned economic factors such as the needs and the efficiency of running the business the particular training requirements of the job
  • This is going to throw greater focus and pressure on employer’s absence and performance management procedures, since these will have to be used if the employer is to fairly dismiss an individual over retirement age by reason of poor health or performance. These procedures will have to apply with full rigour to those of all ages if the employer is going to avoid accusations that it is only older employees who are being subjected to these procedures.
  • HR Solutions 10th Year Anniversary Employment Law Update

    1. 1. Employment Law Update Greg Guilford, HR Solutions
    2. 2. Topics to Cover <ul><li>Abolishment of Default Retirement Age (DRA) </li></ul><ul><li>Maternity/ Paternity Provisions </li></ul><ul><li>The Equality Act </li></ul><ul><li>The Bribery Act </li></ul><ul><li>Agency Workers Regulations </li></ul><ul><li>Pension Reforms </li></ul>
    3. 3. <ul><li>Abolishment of the Default Retirement Age (DRA) </li></ul>
    4. 4. Default Retirement Age <ul><li>The background… </li></ul><ul><ul><li>Previously allowed to dismiss employees simply because of their age </li></ul></ul><ul><ul><li>Age Discrimination introduced ‘retirement’ as a fair reason for dismissal </li></ul></ul>
    5. 5. Default Retirement Age <ul><li>From 1 st October 2011 </li></ul><ul><ul><li>The DRA and statutory retirement procedures will be abolished. </li></ul></ul><ul><li>Quite simply, employer enforced retirement is no longer an option based on age * </li></ul><ul><ul><li>*Unless it can be objectively justified… </li></ul></ul>
    6. 6. Default Retirement Age <ul><li>Objectively justifying retirement </li></ul><ul><ul><li>In order for retirement to be considered ‘justified’ , its aim must be both ‘legitimate’ and ‘proportionate’ </li></ul></ul>
    7. 7. Default Retirement Age <ul><li>Proportionate </li></ul><ul><li>What the employer is doing is actually achieving its aim </li></ul><ul><li>The discriminatory effect significantly outweighs the importance and benefit of the aim </li></ul><ul><li>The employer should have no reasonable alternative to the action </li></ul><ul><li>Legitimate </li></ul><ul><li>The health, safety and welfare of the individual concerned </li></ul><ul><li>Economic factors, such as the needs and the efficiency of running the business </li></ul><ul><li>The particular training requirements of the job </li></ul>
    8. 8. Default Retirement Age <ul><li>Advice: </li></ul><ul><ul><li>Wait and see what happens! </li></ul></ul><ul><ul><li>New piece of legislation, test cases will determine future course of action! </li></ul></ul>
    9. 9. Default Retirement Age <ul><li>So where does this leave employers? </li></ul><ul><li>Performance / Capability Management </li></ul><ul><li>Introduce performance management initiatives </li></ul><ul><ul><li>Performance Appraisal System </li></ul></ul><ul><ul><li>Absence Management </li></ul></ul><ul><ul><li>Capability Policy / Procedure </li></ul></ul>
    10. 10. Default Retirement Age <ul><li>Capability is still a ‘fair’ reason for dismissal. </li></ul>
    11. 11. Default Retirement Age <ul><li>Succession Planning </li></ul><ul><ul><li>Developing talent for the future </li></ul></ul><ul><ul><li>Management of expectations </li></ul></ul><ul><ul><li>Discussions with employees about their future, i.e. are they planning on ‘retiring’ , </li></ul></ul><ul><ul><ul><li>Offer financial discussions with pension provider, etc. </li></ul></ul></ul>
    12. 12. Default Retirement Age <ul><li>Company Benefits </li></ul><ul><ul><li>Health Schemes </li></ul></ul><ul><ul><li>Death in Service </li></ul></ul><ul><ul><li>Employer Liability Insurance </li></ul></ul><ul><ul><li>Company Car Insurance </li></ul></ul><ul><li>These may either increase substantially, or no longer cover employees over 65… </li></ul>
    13. 13. Default Retirement Age <ul><li>How we are helping our clients? </li></ul><ul><ul><li>Revised current policies, issue of new policies </li></ul></ul><ul><ul><ul><li>Capability Policy </li></ul></ul></ul><ul><ul><ul><li>Retirement Policy </li></ul></ul></ul><ul><ul><li>Preparation of draft letters to employees with regards to the impact on their benefits </li></ul></ul>
    14. 14. <ul><li>Maternity / Paternity Provisions </li></ul>
    15. 15. Maternity / Paternity <ul><li>The background… </li></ul><ul><li>Previous position: </li></ul><ul><ul><li>Father entitled to 10 days paid paternity leave (only ) </li></ul></ul><ul><ul><li>Quite often the father took holiday instead of paternity leave </li></ul></ul>
    16. 16. Maternity / Paternity <ul><li>Additional Paternity Leave </li></ul><ul><ul><li>This came into effect from 3 rd April 2011 </li></ul></ul><ul><li>This now allows fathers * to take up to 26 weeks paternity leave in the first year of the child’s life. </li></ul><ul><li>This effectively allows parents to share the full 52 weeks maternity leave. </li></ul><ul><li>*see wider definition in factsheet </li></ul>
    17. 17. Maternity / Paternity <ul><li>Overview of rules: </li></ul><ul><li>Fathers will only be able to start their APL: </li></ul><ul><ul><li>20 or more weeks after the child’s birth or placement for adoption </li></ul></ul><ul><ul><li>Once their partner has returned to work from statutory maternity leave or statutory adoption leave and/or ended their entitlement to statutory maternity or adoption pay, or maternity allowance </li></ul></ul>
    18. 18. Maternity / Paternity <ul><li>In addition 8 weeks before the father wishes APL to start, they must provide: </li></ul><ul><ul><li>Notice of when they wish their leave to start </li></ul></ul><ul><ul><li>A declaration stating that they are taking the leave to care for the child </li></ul></ul><ul><ul><li>A declaration from the mother or other adoptive parent stating certain information </li></ul></ul>
    19. 19. Maternity / Paternity <ul><li>How we are helping our clients? </li></ul><ul><ul><li>Revised current policies, issue of new policies </li></ul></ul><ul><ul><ul><li>Maternity Policy </li></ul></ul></ul><ul><ul><ul><li>Paternity Policy </li></ul></ul></ul><ul><ul><ul><li>Family Friendly Policy (incl. Adoption Leave) </li></ul></ul></ul><ul><ul><li>Preparation of draft letters and forms to help manage the process </li></ul></ul>
    20. 20. <ul><li>The Equality Act (2010) </li></ul>
    21. 21. The Equality Act (2010) <ul><li>The background… </li></ul><ul><li>Previous position </li></ul><ul><ul><li>Previously there were 9 different Acts relating to discrimination </li></ul></ul><ul><li>And now… </li></ul><ul><ul><li>Only one Act, covering all aspects of discrimination </li></ul></ul>
    22. 22. The Equality Act (2010) <ul><li>Key Components </li></ul><ul><ul><li>Tribunals to be able to make common-sense decisions about whether or not particular impairments have a substantial effect on day-to-day activities. </li></ul></ul>
    23. 23. <ul><li>The new legislation also includes: </li></ul><ul><ul><li>Associative discrimination - will now additionally apply to age, disability, gender reassignment and sex discrimination </li></ul></ul><ul><ul><li>Perceptive discrimination - will now additionally apply to disability, gender reassignment and sex discrimination </li></ul></ul><ul><ul><li>Indirect discrimination - will now additionally apply to disability discrimination and gender reassignment </li></ul></ul>
    24. 24. <ul><ul><li>Employers will be potentially liable for harassment of their staff by a third party they don’t employ </li></ul></ul><ul><ul><li>It will be unlawful for employers to ask medical questions of prospective employees, except for defined reasons. It is, however, lawful once an offer has been made and accepted. </li></ul></ul>
    25. 25. <ul><li>What’s not included? </li></ul><ul><ul><li>Dependency on alcohol, nicotine, or any other substance. </li></ul></ul><ul><ul><li>Certain mental health conditions such as a tendency to set fires, steal or physically or sexual abuse someone, or a compulsion towards exhibitionism or voyeurism . </li></ul></ul><ul><ul><li>Tattoos and body piercings </li></ul></ul><ul><ul><li>Hay fever </li></ul></ul>
    26. 26. The Equality Act (2010) <ul><li>How we are helping our clients? </li></ul><ul><ul><li>Revised current policies, issue of new policies </li></ul></ul><ul><ul><ul><ul><li>Equal Opportunities </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Dignity and Respect </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Grievance Policy </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Revised Medical Questionnaire (no longer pre-employment) </li></ul></ul></ul></ul>
    27. 27. <ul><li>The Bribery Act (2010) </li></ul>
    28. 28. The Bribery Act (2010) <ul><li>The background… </li></ul><ul><ul><li>Prior to the introduction of The Bribery Act, the topic of bribery was contained over various pieces of legislation. </li></ul></ul><ul><ul><li>These pieces of law, some of which were over 100 years old, have now been bought together and make up The Bribery Act 2011. </li></ul></ul>
    29. 29. <ul><li>The Bribery Act 2010 came into force in the UK on 1 st July 2011 . </li></ul><ul><li>The Bribery Act will: </li></ul><ul><ul><li>strengthen the UK’s reputation as one of the least corrupt countries in the world,  </li></ul></ul><ul><ul><li>pave the way for fairer practice, encouraging companies to adopt and put into place anti-bribery safeguards. </li></ul></ul>
    30. 30. <ul><li>The Four Key Principles are: </li></ul><ul><ul><li>Paying (or offering) a Bribe </li></ul></ul><ul><ul><li>Accepting a Bribe </li></ul></ul><ul><ul><li>Failing to prevent bribery </li></ul></ul><ul><ul><li>Bribing a Foreign or public official </li></ul></ul>
    31. 31. <ul><li>Failing to Prevent Bribery </li></ul><ul><ul><li>Failure to prevent bribery is also known as the ‘ corporate offence’ . </li></ul></ul><ul><ul><li>This occurs when a company fails to prevent or tackle people who are operating on its behalf from being involved in bribery. </li></ul></ul>
    32. 32. <ul><li>Companies need to pay the utmost attention to this ‘corporate offence’ as it involves everyone associated with them. </li></ul><ul><li>This offence could occur from a range of associated people who operate on behalf of the company whether it is an employee, agent or a consultant . </li></ul>
    33. 33. <ul><li>Possible Defences </li></ul><ul><ul><li>The possible defence against bribery would be the company’s ability to demonstrate that it had adequate policies and procedures in place to stop any bribery from occurring. </li></ul></ul>
    34. 34. <ul><li>Adequate Policies and Procedures </li></ul><ul><ul><li>anti-corruption culture in the organisation </li></ul></ul><ul><ul><li>named senior individual who is responsible for anti-corruption polices and procedures. </li></ul></ul><ul><ul><li>Risk assessments should be in place to determine the potential risk of bribery occurring. </li></ul></ul><ul><ul><li>Companies should have a clear code of conduct that addresses anti-corruptions issues. </li></ul></ul>
    35. 35. <ul><ul><li>Penalties for participating in corrupt activities should be clearly spelt out in employees’ contracts of employment. </li></ul></ul><ul><ul><li>Companies should have a gifts and hospitality procedure that sets out what is and what is not acceptable </li></ul></ul><ul><ul><li>Employees should be given training in anti-corruption matters. </li></ul></ul>
    36. 36. <ul><ul><li>Such financial controls should be set in place so that the possibility of bribery occurring is made unlikely. </li></ul></ul><ul><ul><li>Whistle blowing procedures should be in place where employees can report any matters relating to corruption without, fear of retaliation. </li></ul></ul>
    37. 37. <ul><li>How we are helping our clients? </li></ul><ul><ul><li>Revised current policies, issue of new policies </li></ul></ul><ul><ul><ul><ul><li>Code of Conduct </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Disciplinary Policy </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Business Gifts and Hospitality </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Expenses Policy </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Business Ethics Policy </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Whistleblowing Policy </li></ul></ul></ul></ul><ul><ul><li>Updated Written Statements </li></ul></ul>
    38. 38. <ul><li>SpeakUP Integrity Programme </li></ul><ul><ul><li>Whistleblowing Hotline </li></ul></ul><ul><ul><li>Confidential Reporting </li></ul></ul>
    39. 39. <ul><li>Agency Workers Regulations </li></ul>
    40. 40. <ul><li>The Agency Worker Regulations 2010 will come into force from 1 October 2011 . </li></ul><ul><li>These Regulations have come in on the principle of equal treatment between agency workers and staff recruited directly via a company </li></ul><ul><li>They do not change the employment status of agency workers. </li></ul>
    41. 41. <ul><li>The rule of thumb on what these Regulations mean as ‘equal treatment’ is that they must simply be treated as if they have been recruited directly for the position. </li></ul>
    42. 42. <ul><li>Who is covered by these Regulations? </li></ul><ul><ul><li>These new Regulations cover agency workers, temporary work agencies and employers. </li></ul></ul><ul><ul><li>  An Agency Worker is an individual who is “supplied by a temporary work agency to work temporarily for and under the supervision and direction of a company” .   </li></ul></ul><ul><ul><li>They do not cover self-employed people who work for a company under a contract for services. </li></ul></ul>
    43. 43. <ul><li>Qualifying Periods </li></ul><ul><ul><li>The Regulations will give agency workers 2 rights: </li></ul></ul><ul><ul><li>  The right from day 1 of their assignment to equal access to employment opportunities and collective facilities, and </li></ul></ul><ul><ul><li>The right after undertaking the same role, for the same company for 12 continuous weeks to the same basic working and employment conditions . </li></ul></ul>
    44. 44. <ul><li>Avoidance by a structure of assignments </li></ul><ul><li>Offering 11 week assignments is going to be seen as anti-avoidance if you then break and re-start their assignment. </li></ul><ul><li>A break to discount the qualifying period will need to be at least 6 calendar weeks or more. </li></ul>
    45. 45. <ul><li>From day 1 the agency worker will: </li></ul><ul><ul><li>have the right to be informed of relevant vacancies </li></ul></ul><ul><ul><li>have the same access to facilities </li></ul></ul><ul><li>It does not cover off-site facilities such as an off site gym that is provided as part of a benefit package. </li></ul>
    46. 46. <ul><li>After 12 weeks </li></ul><ul><ul><li>The agency worker has the same basic working and employment conditions as those employees recruited directly. </li></ul></ul><ul><ul><li>This includes: </li></ul></ul><ul><ul><ul><li>Contractual holiday pay </li></ul></ul></ul><ul><ul><ul><li>Overtime pay </li></ul></ul></ul><ul><ul><ul><li>Shift Allowances / Unsocial hours premiums </li></ul></ul></ul><ul><ul><ul><li>Bonuses linked to individual performance </li></ul></ul></ul><ul><ul><ul><li>Luncheon or transport vouchers </li></ul></ul></ul>
    47. 47. <ul><li>Preparation </li></ul><ul><ul><li>Assess the number of agency workers you use </li></ul></ul><ul><ul><li>Assess the number of assignments which last 12 weeks or more </li></ul></ul><ul><ul><li>Review if there are differences between the employment terms and conditions and access to collective facilities </li></ul></ul>
    48. 48. <ul><li>Things to Consider </li></ul><ul><ul><li>Restricting assignments to less than 12 weeks </li></ul></ul><ul><ul><li>Increasing your direct recruitment of temporary employees </li></ul></ul><ul><ul><li>Engaging casual workers through an ‘in house’ bank </li></ul></ul><ul><ul><li>Increase the use of self-employed workers </li></ul></ul><ul><ul><li>Increase the use of managed/outsourced services </li></ul></ul><ul><ul><li>Negotiate with agency suppliers, to reduce risks and costs </li></ul></ul>
    49. 49. <ul><li>The risks </li></ul><ul><ul><li>Agency workers will have the right to bring a claim to an Employment Tribunal to enforce their right to equal treatment. </li></ul></ul><ul><ul><li>The Employment Tribunal can award compensation to take account of any financial loss suffered by the agency worker and can make an additional award of up to £5,000 for any breach of the anti-avoidance provisions. </li></ul></ul>
    50. 50. <ul><li>Pension Reforms </li></ul>
    51. 51. <ul><li>The background: </li></ul><ul><ul><li>In 2012, the Government will be implementing pension reforms in order to increase workplace pension provision. </li></ul></ul><ul><ul><li>The key driver is that there will be more pensioners in the future and those pensioners will live longer. </li></ul></ul><ul><ul><li>This will put a massive strain on the State pension system. </li></ul></ul>
    52. 52. <ul><ul><li>To alleviate this burden, the Pensions Acts 2007 & 2008 make changes to the Basic State Pension, the State Second Pension and introduce new employer duties for pensions . </li></ul></ul><ul><ul><li>The Pensions Act (2008) will auto-enrol some 12 million employees who are not already making the required level of pension contributions into a Qualifying Workplace Pension Scheme (QWPS) . </li></ul></ul>
    53. 53. <ul><li>The employer’s duties </li></ul><ul><ul><li>From October 2012 , employers will be required by law to: </li></ul></ul><ul><ul><ul><li>Automatically enrol all their eligible employees not already in a good quality pension scheme into a QWPS on the day the employee becomes eligible , and </li></ul></ul></ul><ul><ul><li>Pay contributions for every employee who does not opt-out of the QWPS. </li></ul></ul>
    54. 54. <ul><li>Timetable </li></ul>
    55. 55. <ul><li>The Contributions </li></ul>
    56. 56. <ul><li>Quality Qualifying Workplace Pension Scheme (QQWPS) </li></ul><ul><ul><li>Employers can avoid much of the administration burden associated with automatic enrolment by setting up a QQWPS where: </li></ul></ul><ul><ul><ul><li>The total minimum contribution is 11% of qualifying earnings, of which </li></ul></ul></ul><ul><ul><ul><li>At least 6% must come from the employer , </li></ul></ul></ul><ul><ul><ul><li>Automatic enrolment dates can be postponed up to 90 days </li></ul></ul></ul>
    57. 57. <ul><li>Eligible Employees </li></ul><ul><ul><li>All employees will have to be auto-enrolled unless: </li></ul></ul><ul><ul><ul><li>They are already in a qualifying workplace pension scheme , </li></ul></ul></ul><ul><ul><ul><li>They are under the age of 22 , </li></ul></ul></ul><ul><ul><ul><li>They are over the State Pension Age , or </li></ul></ul></ul><ul><ul><ul><li>They earn less than £5,035 a year (in 2006/2007 terms). </li></ul></ul></ul>
    58. 58. <ul><li>What happens next? </li></ul><ul><li>It’s up to you.. </li></ul><ul><ul><li>You can wait until 2012 and let someone else, who knows nothing about your business, set up and run a pension scheme for your employees </li></ul></ul><ul><li>Or </li></ul><ul><ul><li>You can set up your own scheme and retain complete control over your benefits package. </li></ul></ul>
    59. 59. Any Questions?
    60. 60. Employment Law Update Greg Guilford, HR Solutions

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