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19 Sep 2014

Employment

Latest Employment Law Issues

Flexible working

Since 30 June 2014 all employees (with 26 weeks’ continuous service) have the right to request flexible working. Previously, the right only applied to parents of children under 17, the parents of disabled children under 18 and those caring for an adult.

The Government has simultaneously simplified the procedure for considering requests for flexible working. Employers are now under a duty to deal with requests ‘in a reasonable manner’, but can structure the process for handling the request however they see fit. Any request for flexible working, including any appeal, must be dealt with within 3 months. Requests can only be refused on eight specific grounds.

To help employers, ACAS has produced a code of practice giving guidance on how to handle requests in a reasonable manner. Although, we have yet to see flexible working requests made by employees for ‘non-caring’ reasons, prudent employers will update their policies and procedures. There is certainly more scope for employees to make applications to promote a ‘work life’ balance.

Employment Tribunal system

There has been much publicity attached to the changes to the Employment Tribunal system, with the introduction of fees for claimants wishing to bring a case against their employers. In fact, since the introduction of fees, according to national statistics there has been a 70 percent reduction in claims.

Often, even when an employee is awarded a financial settlement, employers refuse to pay. In order to combat this, the Government has announced, in the Small Business, Enterprise and Employment Bill, that penalties will be imposed for non-payment of an employment tribunal award, or settlement reached following ACAS conciliation. The penalty will be 50 percent of the outstanding sum, subject to a minimum cost of £100 and a maximum of £5,000, and will be payable to the Secretary of State, not the claimant. The penalty will be reduced by 50 percent of the full sum, if the outstanding sum and the reduced penalty, is paid within 14 days of receipt of a penalty notice from the employment tribunal enforcement officer.

High value termination payments

High value termination payments in the public sector always attract significant press publicity, particularly when the recipient quickly goes on to secure new employment elsewhere within the public sector.

The Government has recently announced the introduction of a new requirement on high earners in the public sector to repay some or all of a termination payment if they are re-employed in the public sector within 12 months of leaving it.

Parents’ rights

From 1st October 2014, prospective fathers and partners of pregnant women will be entitled to unpaid time off work to attend two antenatal appointments. There is a maximum of 6½ hours for each appointment.

Employers may need to consider amending their maternity and family leave policies to incorporate this change.

From 5th April 2015, adopters will also be entitled to take time off to attend appointments to meet the child they intend to adopt. This will also be subject to a maximum of 6½ hours for each appointment.

Holiday pay

Finally, we should not ignore changes that are arising from decisions of the Courts. In May, the European Court of Justice held that commission must be included when calculating a worker’s holiday pay. Most employers do not include commission in the calculation of holiday pay and potentially this decision could result in substantial costs to employers if employees contemplate claims for the shortfall arising from payments made in relation to previous periods of holiday.

The Locke decision expands on the principle that any payment that is “intrinsically linked” to an employee’s work should be included as part of the holiday pay calculations. This means that the decision is unlikely to be confined to commission payments and the courts will inevitably be asked to consider overtime payments and bonuses in due course. Indeed judgments are expected shortly from the Employment Appeal Tribunal as to whether voluntary overtime should be included in holiday pay. It is likely that the decision will be a ‘yes’.

This decision matters because most employers calculate holiday pay by reference to basic salary only. Potentially, employees can seek to backdate their claims to the 1st October 1998 by way of a claim for unlawful deduction from wages or for six years by way of a claim to the County Courts.

This issue potentially represents a ticking time bomb for many employers given the substantial sums involved. Prudent employers will take legal advice to work on a mitigation strategy to minimise their liability to claims for arrears.

For more information on these changes please contact Daniel Wilde on 01633 244233 or email wilded@hevans.com
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