HR and Employment Law Updates October 2013

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Do you need to know recent changes in employment law? We gave the guests at our HR seminar a brief overview of changes affecting their business. These changes include Settlement Agreements, Employee Shareholder Agreements, CRB checks becoming DBS checks, changes to collective redundancies, and the latest figures of fees and rates.

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  • HR and Employment Law Updates October 2013

    1. 1. #HRSeminarQALaw HR Updates Iain Lock
    2. 2. #HRSeminarQALaw Confidential Pre-Termination Negotiations and Settlement Agreements Came into force 29th July 2013
    3. 3. #HRSeminarQALaw Confidential pre-Termination Negotiations Since 29th July 2013 employers and employees are able to have confidential negotiations between them regarding termination of employment. At the start of any such meeting it is good practice to make sure that the employee is aware that any discussions about the proposed settlement agreement are expected to be: • inadmissible in relevant legal proceedings; and also to • draw the other party’s attention to the Acas Code of Practice on Settlement Agreements before the meeting or at the outset of the discussions. The employee should be informed that the discussions will have no bearing on any disciplinary or performance management procedure in the event that an agreement is not reached. Nb. The offer and negotiations are only confidential in general unfair dismissal claims: claims for automatic unfair dismissal such as for whistleblowing, breach of contract or discrimination claims are excluded.
    4. 4. #HRSeminarQALaw What are Settlement Agreements? Formally known as Compromise Agreements Sets out the terms and conditions that have been agreed by those involved when they agree to settle a potential employment tribunal claim, or other court proceedings. When might a Settlement Agreement be used? To bring an employment relationship to an end in a mutually agreed way. Settlement Agreements are often used in situations where an employer and employee feel that their employment relationship is no longer working and a ‘clean break’ is the best way forward. A Settlement Agreement can allow for both parties to agree the basis for bringing the employment to an end.
    5. 5. #HRSeminarQALaw When would you use a S111A ERA Agreement? Where there is: • no dispute; or • or a possible Unfair Dismissal claim that might be brought to an employment tribunal. When would you not use a S111A Settlement Agreement? In all other cases as there are many exclusions that may mean that you end up in an employment tribunal anyway.
    6. 6. #HRSeminarQALaw Settlement Agreements: The Exclusions: S111 Settlement Agreements only apply in unfair dismissal cases. They do not apply to automatic unfair dismissal cases; for example: • Cases concerning pregnancy and all reasons relating to maternity leave, family leave, parental leave, paternity leave, adoption leave, or time off for dependants • Matters where the employee is acting as an employee representative • Cases where the employee is acting as a trade union representative or in relation to the employee joining or not joining a trade union • In situations where the employee is part-time or a fixed-term employee • Any matters involving Health & Safety or whistleblowing
    7. 7. #HRSeminarQALaw When will the tribunal not allow S111A Settlements in Unfair Dismissal cases? There will be no protection under S111A if there has been some ‘improper behaviour’. When the tribunal finds that there has been ‘improper behaviour’ on either side, the tribunal will have the discretion to decide whether in the circumstances it is just to admit the evidence of the Settlement Agreement Examples of ‘Improper Behaviour’: - All forms of harassment, bullying and intimidation, including offensive words or aggressive behaviour. - Physical assault or threats of physical assault. - Putting undue pressure on the other party, i.e. An employer not allowing the employee a minimum of 10 calendar days to consider a formal offer, or reducing the value of the offer during those 10 days.
    8. 8. #HRSeminarQALaw Should you use S111A Settlement Agreements? The legislation is badly drafted and is full of holes and exclusions so it is easy for an employee to allege improper conduct. They are very limited in scope and could be unravelled at a later stage. They do not protect you from claims of discrimination or other types of claim. They should be treated with care. It is probably best not use them.
    9. 9. #HRSeminarQALaw Employee Shareholder Agreements Came into force 1st September 2013
    10. 10. #HRSeminarQALaw Employee Shareholder Agreements Employee Shareholder Agreements enable employees to have shares in the company that employs them. In return for company shares worth between £2,000 and £5,000, workers would have to give up their rights over redundancy, unfair dismissal, flexible working and time off for studying or training. The employee shareholder must be given full written details of the rights s/he is giving up and the type of shares being offered. The right to independent advice (to be paid for by the employer). 7 day cooling off period.
    11. 11. #HRSeminarQALaw Employee Shareholder Agreements cont. Problems may arise if the employee leaves the company and wants to sell back the shares. What is the mechanism? • Share values on sale. If the company is not listed on the stock market, valuing the shares is elusive and the employee may find themselves stuck with whatever the employer offers. • Shares not valued properly at the outset. There is also a risk that the employee will argue that the shares were not valued properly or correctly at the outset or the shares were not worth the value placed on them therefore the agreement does not stand. If the process is not handled properly the employee can have it overturned at a later date. Our advice is to avoid Employee Shareholder Agreements as they are not worthwhile. If you would like further information please contact us separately.
    12. 12. #HRSeminarQALaw CRB Checks Came into force 17th June 2013
    13. 13. #HRSeminarQALaw Changes to CRB ChecksWhat used to be called the Criminal Records Bureau is now called the Disclosure and Baring Service (DBS). Results of a DBS check will be available online to enable employers to confirm that no new information has been added since the check was originally made, provided that the individual has subscribed to the update service. This means that an employee will not have to obtain a new check. The search will show either show; • “No status change” or • “status change”. • There is no official expiry date for a criminal record check issued by DBS. Any information revealed on a DBS certificate will be accurate at the time the certificate was issued. You should check the date of issue on the certificate to decide whether to request a newer one. You may also be required by law to carry out a fresh check of the DBS children’s and/or adults’ barring lists in accordance with sector-specific guidance.
    14. 14. #HRSeminarQALaw Equality Act Came into force 1st October 2013
    15. 15. #HRSeminarQALaw Changes to the Equality Act From the 1st October the law that makes employers liable for repeated harassment of their staff by people from outside their organisation is to be repealed. The change should ease some of the regulatory burden on employers. Turning a blind eye when there is clearly a problem could still lead to trouble: an employee left to fend off or put up with offensive behaviour without support from their employer is probably going to be unhappy in their job; if morale suffers, so too could performance and ultimately the employee might leave and claim they have been constructively and unfairly dismissed or even bring a personal injury claim if the impact is particularly severe. If the reason for the employer's inaction is related to race or sex or some other characteristic covered by discrimination law, this could constitute unlawful harassment. Caste Discrimination is NOT going to come in.
    16. 16. #HRSeminarQALaw Collective Redundancies Came into force 6th April 2013
    17. 17. #HRSeminarQALaw Collective Redundancies Since 6th April 2013, if you are making: 1. 20 or more people redundant in 90 days, there must be a minimum of 30 days consultation. 2. 100 plus people redundant in a 90 day period, there must be a minimum of 45 days consultation. The effect of the Woolworths case on collective consultation: As a result of a case concerning Woolworths the Employment Appeals Tribunal have stated that where a business is making 20 or more redundancies in a 90 day period and they operate over a more than more site they have to consult across all sites and not just establishment that was making the redundancies. The previous position was that a business only needed to collectively consult where 20 or more redundancies were proposed at one establishment within a 90 day period. This decision is being appealed by the Government so keep an eye out for the decision.
    18. 18. #HRSeminarQALaw Fees and Rates
    19. 19. #HRSeminarQALaw Tribunal Fees: As from 29th July 2013 the Claimant must now pay fees to issue proceedings and if the case goes to a hearing. The fees are as follows: Type A claims are for unlawful deductions claims, holiday pay etc. Type B claims are all other claims Claimants can claim fees back from the Respondent if they win. Issue Fee: Hearing fee: Type A Claim £160 £230 Type B Claim £250 £950
    20. 20. #HRSeminarQALaw Compensation Awards Limit: Came into force on 29th July 2013 The Compensation award is capped at £74,200 or 52 weeks salary, whichever is lower.
    21. 21. #HRSeminarQALaw National Minimum Wage Rates: With effect from 1st October 2013 the National Minimum Wage increased to: Age Minimum Hourly Rate 21+ years £6.31 18 – 20 years £5.03 Under 18 years £3.72 Apprentice £2.68

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