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PPMA Annual Seminar 2017 - Employment relations updates


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Our popular annual update returns and will cover the latest understanding on Brexit and forthcoming Government consultations and employment law changes.

Published in: Government & Nonprofit
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PPMA Annual Seminar 2017 - Employment relations updates

  1. 1. Employment Law update Luke Menzies Barrister & Solicitor of Menzies Law Specialist Employment Lawyers, Bristol PPMA 27 April 2017
  2. 2. Trends and headlines… ▪Brexit ▪Atypical workers ▪Gender Pay Gap ▪Dress codes
  3. 3. Brexit
  4. 4. Brexit  Lots of employment law comes from the EU  All EU employment law is already incorporated into UK law  So nothing will change without new legislation  Seems unlikely that employment law is going to be top of the list once we’ve left the EU  Perhaps some tweaking, but not significant change
  5. 5. Brexit  Potentially, a right-wing, pro-business future government would be interested in rolling back some employee rights  But the price of a trade deal might well be some level of buy-in to EU laws
  6. 6. Brexit Likely candidates  Working Time regs – 48-hour week  Working Time regs – calculation of holiday pay  Agency Workers regs  TUPE – post-transfer harmonisation Impact of no longer being bound by ECJ judgments – fewer unexpected developments
  7. 7. Brexit Another key issue is status of EU nationals Already seen a reduction in hire of EU nationals But to make any changes now is potentially discriminatory Likely to need to wait until after we’ve left EU before making any significant changes
  8. 8. Atypical workers
  9. 9. Atypical workers Categories of engagement:  Employees  ‘Workers’ (NMW, WTR, equalities, etc.)  Self-employed contractors/consultants (with or without a service company)
  10. 10. Atypical workers The Gig Economy is putting these definitions under considerable pressure Many more atypical workers = bigger problem Employers  Say it’s all about flexibility  But this can be achieved by other means  In reality it saves NIC, sick pay, holiday pay, family leave pay, redundancy pay, UD risks, etc.
  11. 11. Atypical workers Recent cases:  Uber (workers) – EAT appeal awaited  Pimlico Plumbers (employees)  City Sprint (workers)  Deliveroo (workers for union recognition) Others potentially in the wings
  12. 12. Atypical workers Disruptive modern tech meets employment law The usual tests apply – integration, control, mutuality of obligation, etc. Check status of all your workers Also your consultants IR35 tax risk too Do you rely on suppliers who are taking advantage?
  13. 13. Gender Pay Gap
  14. 14. 1970 46%
  15. 15. Today 18 % 27 %
  16. 16. Gender Pay Gap v. Equal Pay  Equal Pay  Legal right to be paid same as man/woman doing same job/work of equal value  Gender Pay Gap  Simply the difference between average earnings
  17. 17. Gender Pay Gap v. Equal Pay  Gender Pay Gap  You could have huge GPG and no equal pay risk  You could have zero GPG and huge equal pay risk  BUT a significant GPG exposes you to scrutiny  Increased likelihood of equal pay claims  ER and IR problems  Recruitment and retention problems, etc.  External scrutiny: public, press, unions, etc.
  18. 18. GPG key stats
  19. 19. GPG key stats GPG by age group UK 2015
  20. 20. GPG causes  The “lost women” in management  Part-time work & the hourly pay rate penalty  Educational choices and achievements  Work experience (time spent at work)  Occupations and values placed on them  Occupational segregation  Maternity leave and its consequences  Discrimination
  21. 21. GPG causes  Education  Work experience  Occupation  Occupational segregation  Maternity leave  Part-time work  Discrimination The “lost women” in management
  22. 22. GPG causes Full-time v. Part-time work
  23. 23. GPG causes The hourly pay rate penalty
  24. 24. Closing the Gap  Government  Wants to close “in a generation” (more like 60 yrs)  Led by Cameron and now by May  Individual ‘rights based’ approach doesn’t work very well  Mandatory GPG reporting – a big step  Liberal v. Radical approaches (equality of opportunity v. equality of outcome)
  25. 25. Closing the Gap  Society  Women:  ask for more pay rises?  negotiate harder when hired?  refuse to accept PT hourly pay rate penalty!  Men: accept there’s a problem that needs fixing  Schools & colleges: educate to eradicate!
  26. 26. Closing the Gap  Employers  Audit, understand  Educate and train pay decision-makers  ‘Unconscious bias’ training in particular  Equality of opportunity: bonuses, awards, etc.  Equality of outcome: hourly pay rate  Pay structure: more transparency; more flexibility  Reduce (perceived) cost of substituting one worker’s hours for another (good IT helps)
  27. 27. Equal Pay  We all need to be able to spot equal pay risks and assess them  Equal with who?  ‘Like work’  Work rated as equivalent by JES agreed with workforce/unions  Equal value
  28. 28. Equal Pay  How far can you defend unequal pay?  The ‘material factor’ defence: genuine and not a sham or pretence a significant, material factor which definitely caused the whole of the pay differential and not itself tainted with any sex discrimination
  29. 29. Equal Pay  ‘Material factor’ defence examples:  Market rate for the job  Bonus genuinely linked to personal performance  Pay supplement based on additional qualifications  Pay protection  Anti-social hours, unpleasant working conditions, etc.
  30. 30. Equal Pay  Beware the evaporating ‘material factor’ defence  Justification fades over time  Market rate  annual checks  obtaining and archiving evidence  Pay protection… for how long?  restructuring  TUPE
  31. 31. Equal Pay  Legal claims  Time limits  Employment Tribunal – 6 months  Civil courts – 6 years  Back pay  Piggy-back claims
  32. 32. Equal Pay  Transgender  Not yet accounted for in Equal Pay legislation or GPG data reporting  Presumably gender at time of any audit or claim is what will count  Gender fluid/genderqueer/third gender  Again, not yet accounted for in Equal Pay legislation or GPG data reporting  Would add extra layer of complexity to current binary approach
  33. 33. GPG reporting  Voluntary approach not worked  Public Sector Equality Duty not made major dent in public sector GPG  Mandatory GPG reporting: major step change  Highlight issue  Focus minds  Educate  External scrutiny: unions, press, public
  34. 34. GPG reporting  Applies to employers with 250+ workers  Only count within each separate legal body…  … so no need to include subsidiaries except where they employ 250+ (divergence from Equal Pay law)  Perhaps will allow group reporting in future years  Count employees. ‘workers’ and all others working under a personal contract (casuals, consultants, contractors)
  35. 35. GPG reporting  Data ‘snapshot’ is 5 April 2017 for private and voluntary sector; 31 March 2017 for public bodies  12 months to then calculate GPG data and publish  Publish on your website and upload to Government’s searchable website – with a narrative  Narrative content could be critical  Explain your gap, set in context  Outline what you’re going to close your gap
  36. 36. GPG reporting  Data to publish:  the mean and median average gender pay gap figures for the organisation  the mean and median bonus pay gender pay gap for bonus payments over the last 12 months  the number of men and women working across the 4 salary quartiles
  37. 37. Equal Pay audit  Many benefits to having an Equal Pay audit done now:  Know where your risks are  Calculate your financial exposure  Be able to confirm you are in control and are taking action  Reduce your GPG significantly in Year 2
  38. 38. Equal Pay audit  Menzies Law’s Equal Pay audit process:  We include everyone and everything  Collect and collate your data  Align and check  Analyse and understand  Assess your legal risks  Review outcomes and discuss causes  Make recommendations for your pay structure  Draft a report and review it with you  Finalise report and plan your attack
  39. 39. Do we really need an audit?  Yes! Many benefits to getting an external audit  Impartial and objective  Professional expertise your team unlikely to have  Avoids any accusations of axe-grinding  Avoids embarrassment re your own pay!  Messages in external report have more impact?  Helps draw a line under previous practice  Fact that you’re taking expert advice could be useful in your GPG reporting narrative  And you’re busy enough as it is
  40. 40. We can help  Menzies Law’s GPG Audit & Advice service  We are a repository of vast amounts of Equal Pay audit knowledge  Enormous experience in pay structures and JES – to help you improve pay equity
  41. 41. Dress at work
  42. 42. Achbita v G4S  Belgian case at ECJ  G4S banned any visible religious symbols on duty, Ms Achbita was dismissed for her refusal to remove an Islamic headscarf  Advocate General Kokott’s opinion – not discriminatory  Not ‘less favourable treatment’, and even if it was, it was justified as a ‘genuine and determining occupational requirement’
  43. 43. Bougnaoui v Micropole  French case in ECJ  Similar facts – B required to remove headscarf for public facing elements of role and dismissed after a customer complaint  Advocate General Sharpston’s opinion - it was directly discriminatory, and although the genuine and determining defence might be available, it had to be strictly applied.  Probably be the UK tribunals’ approach
  44. 44. The answer…? Sort of.. Indirect discrimination (rather than direct) is the likely risk area National courts to determine any defence of justification So it will depend on the facts
  45. 45. And in other dress code news…  Parliament’s Women & Equalities Committee recommends legal reform  Many women gave evidence – a lot of disciplinary action and threats of it
  46. 46. Dress codes  Time for end of ‘equivalent standards’ approach?  What image do you want to portray?  Where to trans and third gender/gender- fluid staff fit in?
  47. 47. Any Questions?
  48. 48. Luke Menzies 0117 325 0526 @MenziesLaw