Annual Employment Law Review – Key Developments

David Poddington, Partner

Jenny Arrowsmith, Associate

Tom Draper, Solicitor

8 December 2011

Outline

Looking back at 2011

Case law update: Top 5 cases

What to look for in 2012

Conclusions & questions

Looking back at

Paternity Leave Changes

Additional Paternity Leave

Applies to parents of babies born (and adoptive parents notified of a match) on or after 3 April 2011.

Gives fathers the right to take up to 26 weeks paternity leave, if: they remain employed by the employer until the week before the first week of their APL; the child’s mother has been entitled to statutory leave; and the mother (or primary adopter) has returned to work early and has stopped claiming the

relevant pay.

APL must be taken as multiples of complete weeks and as one period. The minimum amount of APL that can be taken is 2 weeks. The maximum amount of APL that can be taken is 26 weeks. APL must be taken in the period beginning 20 weeks after the child's date of birth and ending

12 months after the child’s date of birth.

Bribery Act 2010 Came into force on 1 July 2011

Introduced a new offence to prohibit someone obtaining or retaining a business advantage through “bribery”

Liability of non compliance for both individuals and company Civil liability – unlimited fines Criminal liability – maximum jail sentence of 10 years

Defence: if organisation has “adequate procedures” in place Risk assessments – regular and comprehensive to assess exposure risks to bribery Top down commitment – establish a culture acknowledging that bribery is never accepted Due diligence – policies and procedures covering all parties to the business relationship Clear, practical and accessible policies and procedures - communicated to all in organisation Effective implementation – ensure policies are embedded throughout the organisation Monitoring and review – to ensure compliance and identify any issues

Default Retirement Age (DRA) The DRA was abolished on 1 October 2011

For an employer to dismiss an employee fairly on the grounds of retirement they must have issued notice of retirement on or before 5 April 2011 and the employee must have reached 65 on or before 30 September 2011.

The choices for employers now are either to: Abandon a retirement age – face up to the prospect of performance management of older

employees, including very old employees, and the risk of claims as a result; or

Retain a retirement age – unless it can be justified, any compulsory retirement age will be age discrimination and an unfair dismissal.

N.B Case law on justifying retirement ages now eagerly anticipated..........

DRA How to justify a retirement age:

Workforce planning; Health and safety; Physical fitness; Having an age balanced workforce;

Consider the alternatives (less discriminatory ways) Objective, not subjective, justification Evidence – assertions alone are not enough

Implications of DRA removal“Workplace discussions” under ACAS GuidanceNeed a potential fair reason for dismissalConsider alternatives, e.g. Compressed hours, job sharing, redeploymentRecruitment of older employees becomes more likely Need for consistent management of all employeesFlexible working requests.

Facilitating recruitment and retention of younger employees; Managing congenial working environment; and Cost.

Agency Workers Regulations 2010

The Regulations came into force on 1 October 2011

The Regulations apply to workers employed or engaged by an agency and: Assigned to a hirer to provide a service or who work under a contact to provide services; Work on behalf and for an agency; and Assigned to a hirer to work temporarily under the hirers supervision and direction.

The Regulations do not apply to: self-employed independent contractors; consultants; and employees placed into permanent employment via an agency.

Entitlements

Day 1 rights: Agency workers must be given access to certain facilities and be provided with

information on job vacancies, as they would if they were employed by the hirer directly

It is the hirer’s responsibility to provide such access

12 week rights: Agency workers are entitled to the same basic terms and conditions which they

would have been entitled to if they had been employed direct by the hirer for the same job

It is primarily the agency’s responsibility to provide these rights

Alternatives / Exemptions Change agency workers or employ them directly Increase the use of casual labour - zero hour contacts The Swedish Derogation Managed Service Contracts

Case Law update: Top Cases

Case law update 2011

Davies v Sandwell Metropolitan Borough Council (EAT)

Employers proposing to dismiss an employee who is on a final written warning should not assume that the warning will be treated as valid by an Employment Tribunal simply because the employee did not appeal against it at the time.

Implications

Ensure that a fair procedure is followed at all stages.

Review previous warnings before dismissal.

Case law update 2011

Noor v Foreign & Commonwealth Office (EAT)

Adjustments to an interview process should still be made even if it would not have guaranteed that the employee would get the job.

Implications

Although the purpose of a reasonable adjustment is to prevent a disabled person from being at a substantial disadvantage, an adjustment does not have to be completely effective to be “reasonable”

Consider adjustments prior and at interviews to remove disadvantage at that stage, including enabling applicants to be as prepared as other candidates.

Case law update 2011

Marcroft v Heartland (Midlands) Ltd (Court of Appeal)

An employee who had handed in his notice shortly before a TUPE transfer had continued to be assigned to the undertaking despite not attending the office and only doing a small amount of work from home.

Implications

TUPE transfers the employment of those who have resigned from transfer at date of transfer but have not yet left.

There is a duty (under TUPE) to provide representatives of affected employees with certain information, but this duty does not extend to notify individual workers personally.

Case law update 2011X v Mid Sussex Citizens Advice Bureau and others (Court of Appeal)

Volunteers engaged under contracts “personally to do work”, or in a work experience or vocational training placement may be entitled to protection under UK discrimination legislation.

Implications

Organisations using volunteers should review existing arrangements and consider whether contracts are used and, if so, whether that practice will continue, and what exposure they may already have for discrimination claims.

If any exposure to discrimination claims exists then steps should be taken to minimise liability and care should be taken when terminating any volunteer arrangements.

Case law update 2011

Alemo-Herron v Parkwood Leisure Ltd (Supreme Court)

TUPE transferred employees may still be entitled, post-transfer, to pay increases negotiated under industry wide collective bargaining arrangements, even though their new employer is not a party to collective agreement.

Implications

This case could be regarded as bad news by private and third sector service

providers involved in public sector outsourcing.

ECJ referral has been made.

What to look for in

What to look for in 2012Tribunal reform

Employer and employee protected conversations

Compulsory lodging claims with ACAS before an ET claim can be lodged

The qualifying period for unfair dismissal to be increased from one year to two

years with effect from 1 April 2012.

Fees are to be introduced for Tribunal claims

£250 when lodging a claim?

£1,000 payable by the Claimant when the hearing is listed?

Higher fees if the claim is worth over £30,000?

Implications

Less ET claims? Less vexatious claims?

More discrimination or statutory right claims?

What to look for in 2012Collective Redundancy & TUPE Consultations

Redundancy Consultation Single, short consultation period to replace the 30 to 90 day current structure; More guidance on when consultation starts and ends and when notice can be given

and end; and The overlap between collective and individual consultation.

TUPE Consultation is likely to address issues such as: Is a separate category need for change of service provider, post-transfer change or

harmonisation of terms and transfers offshore; In relation to informing and consulting – clarity on where there is a redundancy

exercise as part of a transfer, where there will be two connected but distinct obligations to inform and consult.

What to look for in 2012Auto-enrolment and new employer pension duties – October 2012

Four year staging process.

Employers must automatically enrol eligible jobholders in a pension scheme. Employer’s own occupational pension scheme; Personal pension scheme; or National Employment Savings Trust (NEST).

Staging date determined by number of people on PAYE scheme and reference number.

Compulsory employer/employee contributions

Eligible jobholder: An employee; Between the age of 22 and state pension age; and Earning at least £7,475 per year.

The Pensions Regulator will write to employers 12 months before their staging date to confirm the date that they are required to comply with auto-enrolment.

Any questions?

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