Is this the end of Tribunal Fees?
In a landmark decision early today (26th July ’17) the Supreme Court decided that the Employment Tribunal fee regime introduced in 2013 is unlawful.
This marks the end of Unison’s four year battle to overturn the regime introduced by the Conservative Government back in the days when it had a strong majority in the House of Commons.
The judgment is striking, not only because of its far reaching effects, but also in its conclusions:
- the fees regime was ‘ultra vires’ (i.e. beyond the Government’s legal power) because the 2013 Order effectively prevented access to rights contained in employment legislation
- it was also unlawful under European Law because it introduced unjustified limitations on workers’ rights under EU law
- the higher fees for ‘type B claims’ (which include discrimination) were indirectly discriminatory against women
It is hard to imagine a more comprehensive routing of the fee regime! Furthermore, the decision means fees already paid (reported to be as much as £27 million) will have to be re-paid to claimants.
This decision has immediate effect, so huge efforts are going to be required to amend the applicable rules, systems and guidance. There are also serious questions about whether claims that were discouraged by the regime can now be taken.
Employment Tribunal claims were once the bane of employers’ lives, but after the introduction of fees the numbers of claims fell off a cliff with a reduction of 70%. It is of course too early to predict what will happen to claims in the future, but all indicators are that employers will face significantly more claims.
Quite what the Government’s response will be remains to be seen; they may introduce a new fee regime with significantly lower fees, or simply revert to free access.
How bad will this be for employers?
In our view it should not be a problem for employers who understand employment rights and operate policies and practices that underpin fair and equal treatment. However, it is bound to cause disruption, pain and cost for those who don’t understand or follow employment laws.
Inflation kicks unfair dismissal awards upwards
Inflation affects everything of course, so why shouldn’t awards for unfair dismissal go up also? And indeed they do, in April of each year the new maximum awards are set for basic awards, statutory redundancy payments, and compensatory awards.
So on 6th April 2017 the ‘free money’ element (basic award / redundancy) becomes £14,670.00 (for an employee with 20 years’ service) and the maximum compensation element goes up to £80,541.00.
So the worst case scenario for falling foul of the unfair dismissal legislation will be awards totalling just over £95,000.00 plus legal costs, management time and damage to reputation.
Which leads me nicely on to the next noteworthy development in this area: earlier this month the Ministry of Justice launched its website of employment tribunal decisions.
Already hundreds of judgments have been published. Keen to see what was going on in the world of tribunal misery I subscribed to the free update service and my email inbox has not been the same since!
This is all – quite obviously – bad for employers who get things wrong or pay little regard to employee rights. Good for Employment Law and HR consultants? Well perhaps so.
Indirect Discrimination and Shared Parental Leave (SPL)
Network Rail has recently slashed its maternity pay to female employees, why? The reason is that if an employer pays female employees enhanced maternity pay, but does not pay male employees enhanced pay when they take SPL, this practice is likely to be indirectly discriminatory.
In fact Network Rail has just been ordered to pay £28k compensation to one male employee for this very reason.
It’s one of a handful of anomalies that result from the introduction of SPL and that particularly affect schools who have burgundy book and green book incorporated terms.
I spotted this in 2014 when the SPL Regs were introduced and consulted with clients and the unions to canvass opinion. Only NASUWT responded substantively and they argued for the most beneficial outcome for female employees.
Respect to NASUWT for bothering to consider the issues we highlighted; SPL is headache inducing stuff and the SPL Regulations make the blueprints to the death star seem like instructions for a space hopper!
Problem 1 – indirect discrimination
There are three options, and – sorry about this – none of them are particularly attractive.
The expensive approach
Firstly, you can pay male employees enhanced pay when they are on SPL so there is no difference in treatment. Potentially this means allowing up to 18 weeks of enhanced pay to male employees and so could be very expensive (remember, under SPL female employees can share up to 37 weeks of their maternity pay).
The ballsy approach
Alternatively, you can amend your Family Friendly Policy to make it clear that no employees who are on SPL will be entitled to enhanced pay.
If you are going to do this you need to set out all substantial reasons for this as justification. This way, at least if you face a claim you will have a credible justification defence. It may not work, but you will have something to rely on. If this is your preferred approach you will need professional help when re-drafting your policy.
The Kaiser Chiefs* approach
Finally, you can withdraw female employee’s rights to enhanced pay. If these rights are contractual (e.g. collectively agreed and incorporated by the burgundy / green books) this will be almost impossible without provoking industrial action and risking constructive dismissal claims en masse.
Problem 2 – stop start rights to enhanced pay
The story doesn’t end here, enhanced pay during SPL gives rise to a further quandary:
If an employee opts to take SPL, does this mean that the right to enhanced pay can then be used on a ‘stop start’ basis like SPL rights? e.g. can the employee opt to be on SPL during term time with enhanced pay, and then ‘at work’ during school closure periods (receiving full pay)?
If so, enhanced maternity pay can be used in tandem with SPL to entitle each employee to an additional 10 weeks’ full pay during the 52 week SPL period. Ouch!
The cost to your organisation if this is correct is considerable and the possibility of ‘stop start’ rights to enhanced pay appear patently unreasonable.
The alternative is to create a rule that enhanced pay cannot be used on a stop start basis but must be used during the first 18 week period (i.e. the period in which female employees are entitled under the burgundy / green books to enhanced pay if they remain on maternity leave rather than taking SPL).
So, to avoid the ‘stop / start’ anomaly, all employees must only be allowed enhanced pay during the same limited period (under the burgundy / green books this will be the first 18 weeks only).
- Refuse to pay enhanced SPL to anyone and rely on your best justification arguments to limit the risk of indirect sex discrimination claims (and brace for impact), or
- Conflate your existing enhanced maternity pay rights with SPL to create a level playing field but avoid the cost of ‘stop / start’ rights to enhanced pay.
If you need help with SPL generally (or know someone who does) we can help.
For details of our SPL system follow this link.
* see the Kaiser Chiefs’ popular song “I predict a riot’
Employees who want to whistle blow on their employers
It is not a subject most employers care to consider very much, after all, most employers intend to have their house in compliant, good order. Also one hopes that an employee who has a serious concern will bring it to their employer’s attention first, but this does not always happen.
The Government has recently updated the ‘Pay and Work Rights Complaints Form’, which is available on the gov.uk website. The idea is simple: got a complaint about the national minimum wage, an employment agency, or working hours? Then complain directly to the relevant government department. Wage offenders are ‘named and shamed’ on gov.uk and enforcement bodies are notified and the complaint investigated.
Essentially, the problem is taken out of the employer’s hands and the opportunity for low level resolution is lost.
But how do you encourage employees who have grievances and serious complaints to feel confident enough to raise them directly? The answer is simple but frequently overlooked:
You need to have Grievance and Whistleblowing Policies in place, these documents need to be easy to read and understand (i.e. not lengthy and complex), and your employees need to have been given, or have easy access to them.
It doesn’t need to be costly or difficult either; if you need your old policies updated and made user friendly, or you have nothing in place and recognise the benefits of getting this sorted then do as the Four Tops sang: ‘reach out‘ to us.
The U.K. voted with its heart to leave the EU
-but what will it mean for employers and employees?
After ‘informal discussions’ and a scramble by our leaders to piece together a plan for how Brexit will work in practice, the UK will give notice of intention to leave under Article 50 of the Lisbon Treaty.
Immediate reactions by the leading figures in the ‘leave’ camp were that we should not rush to give notice under Article 50. However, it is becoming very clear that the rest of Europe will use all levers to pressure formal process as soon as possible. Delay will mean harm to relations with the rest of Europe and our chances of negotiating an acceptable trade deal.
Article 50 then provides 2 years for a ‘withdrawal agreement’ to be reached. This can be extended but only by unanimous consent. Only when the withdrawal agreement is complete will the UK cease to be a member of the EU.
So for at least 2 years there will be no changes to UK Employment Law; the Directives and the European Court’s decisions will remain binding for us.
Quite what the withdrawal agreement will look like is anyone’s guess, but to avoid calamity for the UK economy it is almost certainly going to result in the UK either remaining in the European Economic Area (EEA) or putting trade deals in place that require significant compliance with the EU’s rules and regulations.
Put simply: our trade partners in Europe won’t allow us to eat our cake and have it! So the likelihood of deep and meaningful changes seem small.
And when it’s all finally sorted?
The majority of the UK’s employment laws either pre-existed our treaty obligations or ‘gold plated’ what the EU required, so don’t expect Brexit to have a massive impact on employment rights. The tide in recent years has been toward eroding employee rights that were deemed inconvenient for business and pundits suggest that changes may include:
- threshold for collective redundancy consultation reduced
- TUPE prohibition on post transfer harmonisation relaxed
- 48 hour maximum working hours removed
What happens will be in the hands of whoever constitutes our government after the withdrawal agreement: and there lies the really big question!
The Brexit vote cut across political party loyalties and quite how our existing bi-party system will re-shape to take account of the result, and whether the trend for deregulation will continue, remains to be seen.
The ride promises to be bumpy for the UK (and what will fall from the roof rack we cannot tell); we must trust that our nation’s spirit, determination and resourcefulness will see us to a prosperous future!
How will the Modern Slavery Act affect your organisation?
Commercial Organisations who supply goods or services and who have a group turnover of more than £36 million now have to publish a ‘modern slavery statement’. This will either say they have taken “no steps to eliminate modern slavery” (imagine the bad PR on that one!), or describe their business and supply chain and explain what they are doing to combat modern slavery.
You might say: ‘but surely this will only affect the biggest companies, so why should I care?’. The answer is that this will ‘trickle down’ to affect all businesses who are in the supply chain of the Commercial Organisations who are directly affected.
If you supply goods or services to other businesses, then watch this space and expect to be asked by your clients to confirm the steps you are taking to remove modern slavery from your business and your supply chain.
What should you do?
- adopt a policy on modern slavery
- identify parts of your business or supply chain that are at risk to modern slavery
- identify steps you will take to assess this risk
- decide what you will do to prevent modern slavery in your business or supply chain
- decide how you will measure the success of efforts to prevent modern slavery
- train relevant staff (e.g. those responsible for procurement)
I know what you are thinking: ‘surely to comply with these things we are now going to require all of our suppliers to do all of this!’. You’re right of course! This is how the ‘trickle down’ will happen.
Even if your supply chain is completely free from modern slavery, you will still be affected because the largest businesses in the UK have only two choices: they can admit they are doing nothing and suffer the bad PR, or they can pass the problem down the food chain.
If your business needs help with modern slavery statements, policies or training reach out to us.
Exclusivity Clauses Outlawed
From 26th May 2015 Zero Hours Contracts that prevent employees from working elsewhere or require the employee to get consent from the employer before working elsewhere, are void and cannot be enforced.
This change comes along with a statutory definition of a ‘Zero Hours Contract’: in a nutshell, it is when paid work is conditional on the employer providing it and there is no guarantee that work will be provided.
These types of contracts have been in the limelight for a while now; mostly because some employers use them unfairly and unscrupulously. A recent example is provided by Sports Direct, who employ the vast majority of employees at their depot (around 4,700) on Zero Hours Contracts.
However, it is still perfectly legitimate to use a Zero Hours Contract where there is a bona fide requirement for flexibility. We can provide your business with a contract template that is fair and legal.
DfE Advice causes furore
The Department for Education issued ‘Keeping Children Safe in Education: childcare disqualification requirements – supplementary advice’ on 13th October 2014 ostensibly extending disqualification from childcare registration rules to primary schools from 1st September 2014.
The DfE advice is that schools should obtain additional information about certain staff members, volunteers and those who live or work in their households permanently or temporarily.
It is suggested that staff and volunteers be required to answer questions that relate to disqualifying criteria, not only in relation to themselves but also to other individuals who form part of their household. If a disqualifying criterion applies then the member of staff or volunteer in question is disqualified from working with early years or later years children (depending on the type of duties undertaken) until a waiver is applied for and granted.
Whilst calls for greater clarity regarding the rules are clamorous, schools whose staff or volunteers provide care or education to early years children have been left to figure it out on their own. New guidance is not expected until September 2015 at the earliest.
Reports in the media suggest as many as 300 employees have been suspended already following disclosure of information that suggests automatic disqualification.
We have designed a Suitability Toolkit to help new and existing clients deal with compliance and implementation challenges. We are happy to provide advice and assistance wherever it is needed.
Sefton Borough Council v Wainwright
Ms Wainwright was on maternity leave when her job was made redundant. A new role was created and allocated to her colleague. She claimed automatically unfair dismissal, based on the requirement in the Maternity and Parental Leave Regulations for employees on maternity leave to be offered a suitable available vacancy where there is a redundancy situation.
She won her unfair dismissal claim. And a useful point emerged which is that it’s not necessarily discriminatory for an employer to fail to offer someone like Ms Wainwright the alternative position. Although she had been treated unfavourably, it wasn’t necessarily because of her pregnancy or maternity leave.
So while it is automatically unfair to fail to offer a suitable available vacancy to a woman on maternity leave in a redundancy situation, it shouldn’t be assumed to also be discriminatory. This is significant in the context of compensation; unfair dismissal is capped, but there is no limit on the amount that can be awarded in discrimination cases.