The CMO Survey - Highlights and Insights Report - Spring 2024
HR Practices in the UK
1. HR WORKSHOP
8th February 2016
Esther McLeod
HR & Recruitment Director
IMA Ltd
Bishops Walk House
19-23 High Street
Pinner, Middx, HA5 5PJ
Tel: +44(0)208 9669222
Mob: +44(0)7710 038866
2. SUBJECT DO’S DON’TS
Offer Letter • An offer can be verbal but it is advisable to
confirm by letter. It should contain a formal
offer of the job and will set out the essential
terms and conditions of employment.
• Remember to have the formal letter in place
before starting the recruitment process.
• Will not have an opportunity to address pre-
condition to employment e.g. satisfactory
references, DBS (Disclosure & Barring Service)
checks
• Putting together a letter in haste is not a
recommended strategy.
Contract of
Employment
Compulsory to think about:
• Restrictive covenants
• Confidentiality clauses
• Probationary periods & termination
• Any other inclusions that may be relevant to
their specific business (e.g. financial services,
government etc)
• Benefits
Have this ready before engaging a new
employee, ideally this should be issued at the
same time as the offer letter
Consequences:-
• Ambiguity makes it difficult to manage when
issues arise.
• The danger is if the terms are not in line with what
the new employee is expecting opens company
to risk of further negotiation.
Employee
Handbook
Advisable although non-contractual. It provides
details of company policies and procedures.
Where there are no clear policies & procedures
employees can challenge a decision.
HR Systems
(to compliment
all above)
Comprehensive system is advisable
to avoid loopholes and legal action
• Application Form
• Performance management
• Absence/sickness management
• Flexibility working & working from home
Skimping on all the above items may save cost in
the short term,
BUT
When issues arise without clear guidelines
established in your offer letter, contract, handbook
and HR systems
It will, inevitably, cost you more
What is required for an FDI client to be legal in the U.K?
3. SUBJECT DO’S DON’TS
Retracting an
offer of
employment
• Must consult with individual and
confirm reasons
• Can be construed as Wrongful
Dismissal
Employee unable
to start due to
sickness
• Do not assume that the contract is null and
void must write to prospective employee to
confirm retraction of offer
• Take immediate action do not delay
• Once the start date is past, will be difficult to
terminate employment as it would be construed
the reason for termination is sickness – will be
exposed to DDA (Disability Discrimination Act)
regulation
Payroll • Set up payroll with UK provider
• Must set up UK bank account to
pay employees directly
• Disgruntled employees could incur transfer
charges if payments are received via TT from
outside of the UK
• Additionally company is in breach of
contract as they have made an
unauthorised deduction to their pay
Performance
Management
• Understand contractual obligation
• Document everything
• If challenged in a tribunal hearing and there are
no records it would be difficult for the company
to defend a unfair dismissal claim
Sickness – Short
& Long term
• Employers must manage the situation
with positive action and not allow the
absence to roll on indefinitely.
• Company owes the employee a “duty
of care” and their obligation under
the Disability Discrimination Act
Typical HR issues that arise with FDA clients having set up in the UK
4. SUBJECT DO’S DON’TS
Holiday during
sickness
• Holidays still accrue when a person
is absent through sickness
• Statutory – breach of contract
Health & Safety
• First Aiders
• Workplace risk
assessment
All employers must have a H & S statement.
• At least one member of staff should be
trained in first aid
• Risk assessment is necessary where a
member of staff is pregnant or new work
methods have been implemented
• Breaking the law.
• At risk and failure to meet safety
in the workplace regulations
Redundancy • Ensure selection process is fair
• Selection should also include a trial period
of 30 days. First opportunity of alternative
roles must be given to employees at risk of
redundancy
• Consideration of Training
• Challenge with discriminative practices
• Failure to do so puts process at risk and
challenge of discrimination.
Termination
• Probation
Period
• All processes up to termination
must be documented
• Easier to terminate if an employee is
not working out
• Open to interpretation and challenge if not
documented
• Do not assume that you can terminate without
documentation
Typical HR issues that arise with FDA clients having set up in the UK
5. SUBJECT DO’S DON’TS
TUPE – Mergers &
acquisition
• Seek early legal advice to ensure all
statutory obligations are met.
• All terms and conditions are transferred
across to new employer – except pension
and share options
• Onerous, and if process is not followed you will
be opened to “unfair dismissal” claims
• Unless under extenuating circumstances –
where measures have been stated and for ETO
(Economic, Technological & Organisational)
reason could terms & conditions be changed. If
this is not the case the change would be termed
unfair due to the transfer.
Typical HR issues that arise with FDA clients having set up in the UK
6. Changes in Employment legislation and their likely impact on Companies
setting up in the U.K.
Unfair Dismissal
(except in cases of Discrimination –
sickness, sex etc)
Tribunal Process &
Costs (up to 5 Apr 2016)
Fit Note
• Employees must have 2 years
continuous employment to satisfy
their right to bring an unfair dismissal
claim.
• Prior to this, if an employee was
employed before April 6 2012 was
the period was 1 year.
Inadmissible reasons
Discrimination on grounds of:
• age
• disability
• gender reassignment
• marriage and civil partnerships
• pregnancy and maternity
• race
• religion or belief
• sex or sexual orientation.
• All potential employment tribunal
claims will be referred to ACAS for
pre-claim conciliation.
• Fees will be charged for claims
submitted to an employment tribunal
and appeals made to the
Employment Appeal Tribunal.
• Type B Claims
Unfair dismissal, discrimination,
equal pay, whistleblowing.
Issue Fee £250
Hearing Fee £950
• EAT
In the Employment Appeal Tribunal
the fees are £400 to lodge an
appeal and £1200 for a full hearing
• The Government has indicated that
employers may, in principle, be able
to overrule a GP's advice in a fit
note as to whether or not a person is
potentially fit to return to work.
• Employer could give precedence to
the views of an occupational
health practitioner over those of a
GP.
• The guidance states: "The
assessment about whether your
employee is not fit for work or may be
fit for work (and any other advice in
the fit note) is classed as advice, and
it is for employers to determine
whether or not to accept it.”
7. Challenges in new legislation and their likely impact on Companies
setting up in the U.K.
Data Protection
National Living Wage
& Pension
Immigration – Tier 2 Visas
effective 6 April 2016?
The future of EU/US data exports
• The end of Safe Harbor
EU data protection law prohibits the
transfer of personal data to countries
or territories outside the EEA unless
they are considered to provide
adequate protection. One of the ways
certain US organisations used to be
able to demonstrate an adequate
level of protection was by signing up
to the Safe Harbor principles, a self-
certification standard operated by the
US Department of Commerce and
enforced by the FTC.
• In its October ruling the CJEU raised
concerns about the access US
authorities have to the personal data
transferred from the EU and the lack
of rights to judicial redress EU
citizens have in the US when their
data is mishandled.
Living Wage
• From April 2016, all workers aged 25
and over are legally entitled to at
least £7.20 per hour.
------------------------------------------------------
Pension
• All employers will have to provide
workers with a workplace pension
scheme by law over the next few
years. This is called ‘automatic
enrolment’.
• When your business must start doing
this (known as a ‘staging date’)
depends on how many people you
have on your payroll.
• Check with Pensions Regulator
The Migration Advisory Committee
(MAC) has published its report
containing recommendations to the UK
Government on how to tighten the Tier 2
work visa route.
• Currently, the minimum annual salary
for a Tier 2 General visa is £20,800.
The MAC proposes to substantially
increase this to £30,000, but with a
phased implementation for the benefit
of the public sector and start-up
businesses.
• Immigration Skills Charge (ISC) It has
suggested an upfront surcharge of
£1,000 for each year of the Tier 2
visa applied for. So, if this is
implemented, a three year visa would
cost a business an additional £3,000
and a five year visa an additional
£5,000.
8. Challenges in new legislation and their likely impact on Companies
setting up in the U.K.
Data Protection - EU-US
Privacy Shield
Immigration – ICT
effective 6 April 2016?
Immigration – ICT
effective 6 April 2016?
• 3rd Feb 2016 - EC announced an
agreement for a new framework for
the transatlantic transfer of personal
data to replace the now defunct Safe
Harbor mechanism
• The WP has said that until it has
completed its full assessment (which
it expects to do at the end of March
2016, or possibly in April depending
on how quickly information is
provided by the Commission),
Binding Corporate Rules and
standard model contract clauses are
still valid transfer mechanisms for EU
data flowing to the USA.
The MAC proposes several changes to
the ICT route:
• As well as the ISC, all ICT applicants
should be required to pay the
Immigration Health Surcharge as a
contribution towards the NHS (ICTs
are currently exempt);
• The required prior experience with an
overseas employer should be raised
from one year to two years and the
UK sponsor should be required to
provide a more detailed job
description for the UK role on the
certificate of sponsorship;
Cont.………
• Third-party contracting, typically
where a multinational business sends
a worker from overseas to work on a
project at a customer’s site, should
have its own separate ICT route. For
all such visas, the minimum pay
threshold should be £41,500 per
year.
• the changes will have a significant
impact on recruitment plans for many
employers, especially start-up and
growth businesses that may struggle
to meet the combination of a £30k
minimum salary and ISC levy.