Welcome to this month’s edition of our Newswire. You will find the usual selection of articles on various topics related to HR and employment law. If you want to discuss any of the issues raised in more detail, just pick up the telephone and give me a call. I look forward to hearing from you.
What’s in this month’s newsletter?
✔ What do the next 5 years have in store for us? A review of the main political parties’ manifestos
✔ Sleeping on the job – your staff could still be ‘working’
✔ Further (welcome) clarity on the holiday pay issue
What do the next 5 years have in store for us? A review of the main political parties’ manifestos
As promised in our last newsletter, I have being reviewing the manifestos published by the three main political parties here in England, so you don’t have to! Set out below is a summary of the main policy objectives touching on the areas of HR and employment law.
Theresa May intends to:
✔ ensure that people working in the ‘gig’ economy are properly protected, using the recommendations produced by the government-commissioned Taylor Report;
✔ require listed companies to (i) nominate a director from the workforce, (ii) create a formal employee advisory council or (iii) assign specific responsibility for employee representation to a designated non-executive director;
✔ introduce a right for employees to request information about the future direction of the company;
✔ require companies with more than 250 employees to publish more data on the pay gap between men and women;
✔ ask large employers to publish information on the pay gap for people from different ethnic backgrounds;
✔ improve the take-up of shared parental leave;
✔ help companies provide more flexible work environments that help mothers and fathers to share parenting.
Jeremy Corbyn intends to:
✔ create of a ‘Ministry of Labour’, empowering workers and their trade unions;
✔ clamp down on overseas-only recruitment practices, strengthen ‘safety at work inspections’ and increase prosecutions of employers evading the minimum wage;
✔ provide equal rights for all workers from day one;
✔ ban ‘zero hours’ contracts;
✔ introduce four new public holidays, to mark our four national patron saints’ days;
✔ raise the National Minimum Wage to the level of the National Living Wage for all workers aged 18 and over;
✔ introduce maximum pay ratios of 20:1 in the public sector and in companies bidding for public contracts;
✔ give workers a ‘right to buy’, when the business they work for is put up for sale;
✔ abolish Employment Tribunal fees;
✔ double paid paternity leave to 4 weeks and increase paternity pay;
✔ introduce an enforcement system to ensure compliance with gender pay reporting;
✔ consider introducing statutory bereavement leave;
✔ consider increasing employee rights in redundancy situations;
✔ clamp down on ‘bogus self-employment’.
Tim Farron intends to:
✔ encourage the creation and widespread adoption of a ‘Good Employer’ kite mark, covering areas such as paying a living wage, avoiding unpaid internships and using name-blind recruitment;
✔ establish an independent review to consult on how to set a genuine ‘living wage’;
✔ pay the ‘living wage’ in all central government departments and their agencies and encourage other public sector employers to do likewise;
✔ require larger employers to publish the number of people paid less than the ‘living wage’ and the ratio between top and median pay;
✔ modernise employment rights, having regard to the recommendations of the forthcoming Taylor Report;
✔ stamp out abuse of ‘zero-hours’ contracts, by introducing the right to request a fixed contract and potentially introducing the right to make regular patterns of work contractual;
✔ strengthen the enforcement of employment rights, by consolidating enforcement agencies and scrapping Employment Tribunal fees;
✔ encourage employers to promote employee ownership by giving staff in listed companies with more than 250 employees a right to request shares;
✔ strengthen worker participation in decision-making, including staff representation on remuneration committees and the right for employees of listed companies to be represented on the board;
✔ require large companies with more than 250 employees to monitor and publish data on gender, ethnicity and sexual orientation, having regard to employment levels and pay gaps.
So which way should you vote?
Far be it from me to tell anyone how to cast their vote. However, if your main priority is to keep your HR team and/or employment lawyers in work, then hopefully the summaries set out above will give you a helping hand!
Sleeping on the job – your staff could still be ‘working’
From time to time, our clients need advice on the national minimum wage (NMW) entitlements of those employees who sleep at their place of work. This is a rather confusing area of law, as we struggle to distinguish between two quite similar situations:
✔ where someone sleeps on site (by arrangement), is regarded as being ‘on call’, but is only working for NMW purposes when they are called upon to do something; and
✔ where the person sleeps on site and is regarded as working simply by virtue of being present on the premises, regardless of whether they are doing anything or even whether they are asleep or awake.
In the first situation, the NMW is only payable when the person is awake and working. In the second situation, the NMW is payable for the entire shift.
Working out whether a given situation falls into ‘category 1’ or ‘category 2’ is not easy. Most of the decided case have fallen into ‘category 2’. The judges that have heard those cases have tended to look carefully at whether the employee is required to be present on site for legal or regulatory reasons. They have also looked at the extent to which the employee could be disciplined if they were to leave site during their ‘sleep in’ shift. Where their presence on site is effectively essential, then the courts have tended to find that this is a ‘category 2’ situation.
The recent case of Focus Care Agency v Roberts provided the Employment Appeal Tribunal with a further opportunity to clarify the law in this area. The EAT considered 3 related appeals, all concerning ‘sleep in’ shifts. Unfortunately, but rather predictably, the EAT concluded that whether a person is entitled to the NMW in such cases will depend on the facts of the individual case. However, slightly more helpfully, they provided us with 4 factors that are likely to be given particular weight. These are:
✔ The employer’s particular purpose in engaging the worker – Is the employer subject to a regulatory or contractual requirement to have someone present on the premises, such that the worker could be said to be working simply by being present?
✔ The extent to which the worker’s activities are restricted by the requirement to be present and at the disposal of the employer – Is the worker required to remain on site? Could s/he be disciplined if s/he leaves?
✔ The degree of responsibility undertaken by the worker – Is s/he there in case of emergencies only (such as break-in or fire) or is there a ‘heavier personal responsibility’?
✔ The extent to which immediate action is required, if something untoward happens – Is the worker woken by another member of staff (as and when needed) or is it up to the employee to decide when action is required?
Whilst this case doesn’t provide us with the high level of clarity and certainty that we might wish for, at least it continues to provide us with some useful guidance in working out on which side of the line a given case is most likely to fall.
Want to talk about your business?
If you have a situation of this nature and want to discuss your legal obligations, please get in touch.
Further (welcome) clarity on the holiday pay issue
We all know that over the last few years a lot of articles have been written about the extent to which employers could be hit with claims for shortfalls in holiday pay. Put simply, if you are not factoring in overtime pay, commission and the like, you could be underpaying your staff.
Not only has this all given rise to the prospect of increased costs for the future, but we have also had to worry about the risk of employees seeking to bring claims against their employers for shortfalls in holiday pay stretching back into the dim and distant past. Recent changes in legislation have confirmed that employees cannot go back further than 2 years when making such claims. Furthermore, in the widely reported case of Fulton and anor v Bear Scotland Ltd, the Scottish Employment Appeal Tribunal suggested that if there is a gap of more than 3 months between any 2 incidents of underpayment in holiday pay, this will break the chain of underpayments that the employee can claim.
The employees involved in the Bear Scotland case recently sought to challenge the validity of the EAT’s decision, arguing that the judge that made the remarks in question was speaking ‘off the record’, as it were. As a result, the employees have tried to argue that this principle has no legal standing.
In a decision that represents some welcome good news for employers, the EAT has now confirmed that the Bear Scotland decision should stand and that any gap of more than 3 months between alleged shortfalls in holiday pay will be fatal to an employee’s continuing claim.
Want to discuss this further?
If you are still wrestling with your own holiday pay arrangements and would like a longer chat about the issues raised by this article, please get in touch.
Let us know how we can help you.