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US v. ENGLANDKey Differences In Employment
Law
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21/04/23 3
Nicole TrusoEmployment Attorney (United States)
Emma VennessonEmployment Attorney (England)
Overview
Hiring
Employee entitlements
Wage and hour
Changing terms and conditions
Dismissal
Post-termination
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• Mandatory right to work checks
• Before the employee stars work
• Penalties
◦ fine and potential criminal liability
HiringRight to work
England
April 21, 2023 5
• A Form I-9 must be filled out for all new hires
• The employee must complete Section 1, which includes basis employee information, on or before the first date of hire
• The employer completes Section 2, which requires employee present documentation of work authorization, within 3 business days of the date of hire
• Sanctions for hiring or employing an unauthorized worker range from $375 to $16,000
• There are also various levels of sanctions for improperly completed Form 1-9s
HiringRight to work
United States
April 21, 2023 6
• Vetting must be proportionate
• Typical checks
• Less common checks
• Consent is required in most cases
HiringBackground checks
England
April 21, 2023 7
• Highly unusual in England
• Generally only appropriate where the job will entail a high health and safety risk, e.g. factory workers and drivers
HiringDrug testing
England
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• Drug testing is governed by state law
• Many states impose strict requirements:◦ A written drug testing policy◦ Limited testing circumstances◦ Notice to applicants or employees◦ Opportunity to have testing sample retest
• Developing issues related to drug testing with the recent passage of medical marijuana legislation
HiringDrug testing
United States
April 21, 2023 9
• Medical evaluations at the hiring stage are also not common
• Generally only appropriate where physical attribute or certain level of fitness is required for a job, e.g. construction worker or firefighter
• Take care when taking decision based upon medical evaluation as may be used as basis for disability discrimination claim
• Employee consent is always required for medical evaluation
• Strict requirements must be met if medical information is obtained from the employee’s treating physician
HiringMedical evaluations
England
April 21, 2023 10
• An applicant for employment may not be asked for medical information during the hiring process
• Once an applicant has received a conditional offer of employment, the applicant can be required to undergo a medical evaluation or provide medical information
◦ Does not need to relate to the job◦ Must be required of all employees in the same job category
• Applicants may only be disqualified based on such information if:◦ The reason is job-related and consistent with business necessity, or◦ The applicant poses a significant risk of harm to himself or others
• After an employee is hired, all medical inquiries must be job-related and consistent with business necessity
HiringMedical evaluations
United States
April 21, 2023 11
• Many different laws must be considered with regard to background checks
• Fair Credit Reporting Act (FCRA)
• ADA, Title VII, state laws
HiringBackground checks
United States
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• Employees must have a written statement containing certain minimum terms, including those relating to salary, place of work, holiday and notice
• Must be provided within 2 months of starting employment
• Many employers provide employees with an employment contract containing additional provisions for the company’s benefit, e.g. confidentiality restrictions and post-termination restrictions.
HiringEmployment contracts
England
April 21, 2023 13
• Employment contracts are not required and not common for most employees in the U.S.
• Some executives may have employment contracts that provide benefits upon termination of employment.
• Employees are often required to sign confidentiality agreements, which may also include restrictive covenants and invention assignment provisions.
HiringEmployment contracts
United States
April 21, 2023 14
• Common to include post-termination restrictive covenants in employment contracts of mid-senior level employees
• Covenants are only enforceable if:◦ Protect a legitimate business interest◦ Go no further than necessary to protect that interest
• Duration: ◦ generally no longer than 6 months for non-compete covenants◦ generally no longer than 12 months for non-soliciting and non-poaching covenants
• Unenforceable covenants will not be re-written; courts will blue-pencil
HiringCovenants
England
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• Governed by state law◦ Prohibited in some states except in narrow circumstances◦ States may modify, blue-pencil or completely void the entire agreement
• If enforceable, common to enter into such agreements where employee has access to confidential information or customer contact
• Covenants are enforceable if:◦ Protect a legitimate business interest◦ Go no further than necessary to protect that interest
• Duration: generally no longer than two years
HiringCovenants
United States
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• All employees are entitled to a minimum of 28 days’ holiday each year
• No automatic right to time off on bank holidays although most employers include the bank holidays in the employees’ overall holiday entitlement
• Employers may not pay in lieu of unused statutory holiday except upon termination of employment
Employee entitlementsHolidays
England
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• Subject to certain eligibility criteria, employees who are absent from work due to incapacity are entitled to receive statutory sick pay
• Minimum weekly payment payable for up to 28 weeks in any period of absence due to incapacity
• Employers must make these payments and they cannot be recovered from the government
Employee entitlementsSick pay
England
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• There is no federal mandatory vacation or sick pay entitlement
• Vacation and sick pay is governed by an employer’s policies◦ Policies must be carefully drafted and followed
• Some states prohibit use-it-or-lose-it vacation policies
• Certain cities and the state of California have enacted sick pay requirements
Employee entitlementsHoliday and sick pay
United States
April 21, 2023 19
• Maternity leave◦ Up to 52 weeks regardless of length of service◦ Statutory maternity pay at the higher of 90% or fixed GBP amount prescribed by law
for first six weeks, fixed GBP amount per week for the next 33 weeks, last 13 weeks unpaid
• Paternity leave◦ Two weeks for employees with at least 26 weeks’ service◦ Statutory paternity pay at the lower of 90% or fixed GBP amount prescribed by law
• Shared parental leave – new scheme for babies born after 5 April 2015 Scheme allows an eligible mother to choose to end her maternity leave and the other
eligible parent to take the remainder as shared parental leave up to a maximum of 50 weeks
Shared parental leave pay at the lower of 90% or fixed GBP amount prescribed by law up to a maximum of 37 weeks
Employee entitlementsFamily rights
England
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• Family Medical Leave Act◦ 12 weeks of unpaid leave◦ Certain circumstances, including birth or adoption of a child◦ Employee must:
▪ Have worked for employer for at least 12 months
▪ Have worked 1,250 hours in past 12 months
▪ Work at a facility with 50 or more employees within a 75-mile radius
• Many states have additional family leave entitlements
Employee entitlementsFamily rights
United States
April 21, 2023 21
• Regulations require that employees must not work more than 48 hours per week
• Employers must keep records of hours worked
• Employees can-opt out of these regulations
◦ common to include an opt-out clause in contracts for mid-senior level employees
Wage and hourWorking time
England
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• There is a government prescribed minimum wage that applies to all employees ◦ Usually increases year on year
• There is no automatic right to overtime pay under English law
• Generally, an employee will only be entitled to overtime pay if it is expressly stated in his/her employment contract
Wage and hourMinimum wage and overtime pay
England
April 21, 2023 23
• There is no cap on working hours under federal law
• Certain states may require a day of rest per week
• Certain employees are exempt from minimum wage and overtime requirements
• Employers do not need to keep records of work hours for exempt employees
Wage and hourWorking time
United States
April 21, 2023 24
• Certain employees are exempt from minimum wage and overtime requirements
• Exempt employees must be paid on a salary basis and meet certain duty requirements
• Categories of duties:◦ Professional◦ Executive◦ Administrative◦ Outside sales◦ Computer professionals
Wage and hourMinimum wage and overtime pay
United States
April 21, 2023 25
• Non-exempt employees are entitled to overtime at a rate of 1 ½ times their regular rate for hours worked in excess of 40 hours in a week
• Some states have daily overtime requirements or additional premiums for certain hours worked
• Exempt employees are not entitled to overtime
Wage and hourMinimum wage and overtime pay
United States
April 21, 2023 26
• Changes to terms and conditions can only be made where:◦ the contract allows for changes to be made - limited circumstances when this can be
relied upon, or◦ the employee’s consent is obtained
• Obtaining consent will generally involve:• Consulting with the employee• Offering the employee an incentive to accept the changes
• Where possible, consent should be in writing
Changing terms and conditions
England
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If the employee does not consent, the employer has the following options:
1. Dismiss and re-engage on new terms: very risky
2. Impose changes unilaterally: very risky
3. Choose not to implement the changes: will not achieve desired outcome
By far the safest course of action is to consult with the employees to obtain his/her written consent
Changing terms and conditions
England
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• At-will employment
• Cannot be discriminatory, retaliatory or motivated by any other unlawful reason
Changing terms and conditions
United States
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•Need to consider:◦ contractual rights (in particular notice period)
◦ statutory rights (in particular unfair dismissal and discrimination)
◦ reason for dismissal
◦ process for dismissal
Dismissal
England
April 21, 2023 30
Dismissal
England
April 21, 2023 31
Conduct
Capability
Redundancy
Statutory restriction
Some other substantial reason
Fair Reason
Fair Process
•Depends on the reason for dismissal but generally it will involve (as a minimum):
Consultation/investigation Formal meeting to which employee can be accompanied Outcome in writing Right of appeal
Dismissal
England
April 21, 2023 32
• At-will employment
• Employment contracts may specify terms on which employment may be terminated
• Cannot be discriminatory, retaliatory, or for any other unlawful reason
• Treat similarly-situated individuals similarly
Dismissal
United States
April 21, 2023 33
• No required process for terminating an individual employee in the U.S.
• Recommended process similar to that required in England to defend claims of unlawful treatment
Dismissal
United States
April 21, 2023 34
• Unfair dismissal
◦ Must have at least two years’ service
◦ Will succeed if employer fails to prove that it had a fair reason and followed a fair process
◦ Compensation is currently capped at GBP 92,585 (but usually increases year on year)
Post-terminationKey claims
England
April 21, 2023 35
• Discrimination
• Protected characteristics: Sex, age, race (including nationality), religion or
belief, disability, sexual orientation, gender reassignment, marital status,
pregnancy and maternity
• Covers direct and indirect discrimination, harassment and victimisation
(similar to US concept of retaliation)
• No minimum service required
• Compensation is uncapped
Post-terminationKey claims
England
April 21, 2023 36
• Discrimination: protected characteristics under federal law are age, disability, sex, national origin, race, color, religion, pregnancy, and genetic information. State laws may include other protected characteristics, such as sexual orientation.
• Harassment: must be based on a protected characteristic.
• Retaliation: an adverse action is taken because an employee makes a complaint of discrimination or participated in an employment discrimination proceeding.
• Wage and Hour: failure to pay overtime, improper classifications of exempt workers, improper classification of independent contractors.
• FMLA: common claims include failure to provide the required leave or retaliation for an employee taking leave.
Post-terminationKey claims
United States
April 21, 2023 37
• Most claims are brought in the Employment Tribunal
• Employee must notify the employment conciliation service of his/her intention to bring a claim
• Claimant must pay a fee to bring a claim and a further fee to proceed to hearing
• Common for claimants to represent themselves in the Employment Tribunal
Post-terminationBringing a claim
England
April 21, 2023 38
• Federal claims of discrimination, harassment, retaliation and failure to accommodate must first be filed with the EEOC
◦ State law may have similar requirements
• Common for employees to be unrepresented at this stage
• EEOC or state agency will make a finding and issue a right to sue notice
• No requirement that claims for whistleblowing, wage and hour violations, FMLA or breach of contract be brought to an agency before filing a lawsuit
Post-terminationBringing a claim
United States
April 21, 2023 39
• Employees can only waive statutory claims by entering into a settlement agreement
• Typically, settlement agreement is in return for a compensatory payment
• Settlement agreements must satisfy certain statutory conditions, including the employee receiving independent legal advice on the terms and effect of the agreement
• Employer often makes a contribution towards the cost of the employee obtaining such advice
Post-terminationSettling a claim
England
April 21, 2023 40
• Employees can only waive statutory claims by signing a release of claims
• Typically, release is in return for a compensatory payment
• Waivers of federal age discrimination must meet certain requirements
• Certain claims may not be waived without court approval
• State laws may impose additional waiver requirements
Post-terminationSettling a claim
United States
April 21, 2023 41
Questions?
April 21, 2023 42
Conclusion
April 21, 2023 43
Emma Vennesson
Employment Attorney (England)
Tel: +44 (0)20 7450 4562
Email: [email protected]
Nicole Truso
Employment Attorney (United States)
Tel: +1 612 766 8445
Email: [email protected]
Presenters
April 21, 2023 44
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