Contracts Of Employment 20.10.09.F

Contracts of Employment What you need to know Michael Scutt Dale Langley & Co 60 Lombard Street London EC3V 9EA www.dalelangley.co.uk www.michaelscutt.co.uk

2 (c) Michael Scutt 2009 Definition of Employee • An employee is “an individual who has entered into or works under ... A contract of employment” • S.230(1) Employment Rights Act 1996

3 (c) Michael Scutt 2009 Contracts of employment – what you need to know • What is an Employee? • Why does it matter? • Employees v Workers • Legal Formalities • Statute/Common Law/Implied terms • Disciplinary/Grievance procedures

4 (c) Michael Scutt 2009 Why does it matter? • Different categories of “worker”; • Employees – “mutuality of obligation” • Agency Workers • Casual/Home Workers • Answer: different obligations and legal remedies available

5 (c) Michael Scutt 2009 Employees’ statutory rights • Unfair dismissal • Redundancy • Minimum period of notice • Statutory Maternity Pay/ Stat. Sick Pay • TUPE protection • Apply to employees only • Additionally, an employer can be vicariously liable for an employee’s negligent act

6 (c) Michael Scutt 2009 Workers’ Statutory Rights • Discrimination (sex, race, age, disability, religious belief, sexual orientation) • National Minimum Wage • Working Time Regs (48 hours max) • Right to rest breaks and min. annual holiday (28 days)

7 (c) Michael Scutt 2009 Workers’ Statutory Rights (cont’d) • Whistleblowing • Right to be accompanied at a disciplinary/grievance hearing • All apply to employees as well • None of the above applies to the genuinely self- employed

8 (c) Michael Scutt 2009 Employed v Self-employed • Usual problem is: is the person self-employed? What do Employment Tribunals look at? • Description in job advert • What does job offer letter or contract say? • Tax status of worker – important but not conclusive

9 (c) Michael Scutt 2009 Employed v Self-employed (cont’d) • What happens if the worker can’t perform his duties? • How much does the employer control the worker? • How are similar workers treated? • Who provides the equipment? • Who pays for any professional insurance?

10 (c) Michael Scutt 2009 Example • Joe – telesales operator • Works hours set by employer • Receives (net) pay • Job is done at direction of employer • There is a staff handbook • Disciplinary/Grievance procedures apply

11 (c) Michael Scutt 2009 Case Study 2 • Sue – HR Consultant • Works from own premises • Works for other businesses • Issues invoices for payment • Paid on commission only • Provides own equipment Remember: it is for the “master” to determine whether the “servant” is employed/self- employed

12 (c) Michael Scutt 2009 Camel or Horse? • “If parties agree to create a horse but instead create a camel, the fact that they intended to create a horse and even call what they have created a horse is of little assistance in determining whether it is in fact a horse.” • Levy McCallum Ltd v Middleton EAT [2005]

13 (c) Michael Scutt 2009 Legal Formalities • Contracts of employment not legally required but cf: S.1 ERA 1996 – written statement of terms and conditions to be supplied within two months of employment commencing • http://www.bailii.org/uk/legis/num_act/1996/ ukpga_19960018_en_1.html#pt1-pb1-l1g1

14 (c) Michael Scutt 2009 Legal Formalities cont’d • No free-standing remedy other than a Declaration by ET, but presented with another claim ET can impose two or four weeks’ pay capped at £380 p.w • Immigration, Asylum & Nationality Act 2008 - it is an offence to knowingly employ a person aged 16 yrs or more and who is subject to immigration controls and has not been given leave to enter or remain

15 (c) Michael Scutt 2009 Legal Formalities (cont’d) • All employers must have employers liability insurance – Employers’ Liability (Compulsory Insurance) Act 1969 • UNLESS the only employee is the owner

16 (c) Michael Scutt 2009 Contract terms implied into every employment contract • Mutual duty of trust and confidence • Employer will provide a safe system of work • Employee will take reasonable care of themselves • Employee will obey reasonable instructions • Employee will carry out their duties personally

17 (c) Michael Scutt 2009 Why have a contract of employment? • Notice provisions – extend statutory notice • Mobility/Alternative duties clauses • Right to vary contractual terms • Contract out of WTR (48 hours p.w) • Bonus provisions • Improve SMP/SPP • Reserve right to obtain medical evidence from independent medic • Confidentiality and return of property • Restrictive Covenants

18 (c) Michael Scutt 2009 Disciplinary/Grievance Procedures • Employment Act 2008 • ACAS Code of Practice – www.acas.org.uk • The statutory dispute resolution regulations have been repealed but some cases still caught by them • Three step disciplinary process – investigation/meeting/hearing (right to be accompanied) • 25% uplift/reduction • Doesn’t apply to redundancies/expiration of fixed-term contracts/claims by part-time workers

19 (c) Michael Scutt 2009 Useful Links • www.hmrc.gov.uk/employment-status/index • www.acas.org.uk • www.businesslink.gov.uk • www.dalelangley.co.uk • www.michaelscutt.co.uk • Tel 0207 464 8433 • Twitter = @michaelscutt • michaelscutt@dalelangley.co.uk

Contracts Of Employment 20.10.09.F

by Michael Scutt on Oct 19, 2009

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Contracts Of Employment 20.10.09.F — Presentation Transcript