Employment & Immigration Legal Updates 15/10/2008

Recent and forthcoming changes that affect your business

We bring you recent and forthcoming changes in employment law. Some of these changes are already in place so will affect your business now, the others come into force in the coming months so should be looked out for.

National Minimum Wage

The new National Minimum Wage hourly rates went up on 1 October 2008, they are:

• Standard (adult) rate: workers aged 22 or over - £5.73
• Development rate: workers aged between 18 and 21 - £4.77
• Young workers rate: workers aged under 18 but above the compulsory school age - £3.53
• Accommodation offset rate - £4.46

Employers' liability insurance

As of 1 October 2008 employers no longer have to keep their employer liability insurance certificate for 40 years and from now on there is also no requirement to display an employer's liability insurance certificate on the premises, instead an employer can make an electronic version available provided it is reasonably accessible to all relevant employees.

Maternity and Adoption leave

The Sex Discrimination Act 1975 (Amendment) Regulations 2008 which amended the Sex Discrimination Act 1975, provide that women whose expected week of childbirth begins on or after 5 October 2008 will have the right to the same terms and conditions during additional maternity leave (AML) as they currently enjoy during ordinary maternity leave (OML).

A similar amendment has also been made in respect of adoption leave, under the Paternity and Adoption Leave (Amendment) Regulations 2008. An employee due to adopt a child on or after 5 October 2008, will have the right to the same terms and conditions during additional adoption leave (AAL) as they currently enjoy during ordinary adoption leave (OAL).

The effect of these changes is that employees on additional maternity/adoption leave have the right to receive all non-monetary benefits under their contract, including the continuing accrual of annual leave.

The Sex Discrimination Act 1975 (Amendment) Regulations 2008 also make changes to discretionary bonuses during the 2 week compulsory maternity leave which must be taken immediately after childbirth. If a woman's expected week of childbirth begins on or after 5 October 2008 and she is on maternity leave during a period to which a bonus payment relates, the employer is permitted to reduce the bonus pro-rata for the period of time when she is on maternity leave.

However, any time spent on compulsory maternity leave must be treated as time worked so that the woman receives the bonus as though she were at work.

Agency Workers - the right to Sick Pay

The law currently provides that an agency worker who has been engaged on a contract for less than three months is not entitled to SSP. As of 27 October 2008 agency workers will be entitled to Statutory Sick Pay (SSP) regardless of the amount of time they have been working on a contract.

Although agency workers are treated as employees of the agency for the purposes of SSP, employers may find that the price they pay to the agency will increase as a result.

Repeal of the Statutory Dismissal and Grievance Procedures - April 2009

The Employment Bill, which is currently awaiting royal assent and is due to come into force in April 2009, repeals the Statutory Dismissal and Grievance procedures.

In response to the repeal, ACAS have issued, for consultation, a revised Code of Practice on discipline and grievance for handling workplace disputes. The draft Code is concise and principles-based compared to the current statutory procedures which are unforgiving and complicated.

ACAS has proposed that the new Code is introduced at the same time as the statutory procedures are repealed. The new Code will extend ACAS's powers of conciliation and will be used by Tribunals to either increase any award by 25% if the employer fails to follow the Code of Practice or reduce any award by 25% if the employee fails to follow the Code of Practice.

Equalities Bill

The Government Equalities Office has published 'Framework for a Fairer Future - The Equality Bill' which outlines the details of the proposed Equality Bill. The purpose of the bill is to have one single piece of legislation covering all the different forms of discrimination in an easy to understand format.

The Government are still working on the bill in an attempt to address the "serious inequalities that still exist in the UK". The following are just a few of the proposals:

• Close the gender gap by forcing public bodies to publish pay rates (Treasury pay gap 26%)
• Encourage positive discrimination, whereby firms discriminate in favour of female and ethnic minority job candidates as long as they are as equally suited for the job as their white/male counterparts.
• Ensure older people are not denied access to health or travel insurance.
• Introduce wider powers to Employment Tribunals to make recommendations in discrimination claims, for example, reviewing pay policies. The purpose of this is to make changes to the way employers practice so that the workforce as a whole benefits rather than just an individual claimant.

The Bill is due to be published in the 2008-2009 Parliamentary session. We will keep you updated of its progress in due course.

The European Commissions Proposals on new maternity rights

The European Commission proposed amendments to the current Maternity Leave Directive, which it hopes can be agreed by 2009.

From a United Kingdom employer's point of view this is however not all bad news as our legislation already complies with some of the proposed amendments.

The proposals made by the Commission are as follows:

1. The current minimum period of maternity leave would increase from 14 weeks to 18 weeks. The proposals contain a "recommendation" that women are paid 100% of their salary for 18 weeks, however Member States may be able to apply an upper limit of "at least the level of sick pay". There is uncertainty as to what the Commission means by sick pay and there are two explanations:
• 1.1 If this makes reference to statutory sick pay then this will not affect the United Kingdom's current maternity pay provisions. Our current statutory maternity pay provisions, both basic and higher rates are higher than our statutory sick pay rate. It would not be possible to lower maternity pay in line with the statutory sick pay rate as this would conflict with European Community law.
• 1.2 If however it refers to contractual sick pay, employers would have to ensure that they pay women in the first 18 weeks of maternity leave at least as much as they would have been paid had they been absent throughout this period due to illness.
2. The current two week compulsory maternity period will be increased to six weeks. Additional to this would be the requirement that women are no longer obliged to take some of their non-compulsory maternity leave before childbirth, although this would have no bearing on the United Kingdom as this is not currently a requirement.
3. The current provision enabling a woman to request written reasons for their dismissal, which currently only apply whilst a woman is on maternity leave will be extended to six months after childbirth.
4. The Commission have also proposed women should have the right to return to the same job or an equivalent after maternity leave which is already provided for in our legislation. There is also to be a right to request flexible working on return to work with the employer and as currently provided for in the United Kingdom there will be no obligation to agree to this request.

We will of course keep you up dated as this progresses further.

New interpretation given to Time off for Emergencies

In RBS v Harrison (2008) UKEAT/0093/08 the Employment Appeal Tribunal considered the scope of the right of employee's to take emergency leave to care for dependants under s57A(1)(d) of the Employment Rights Act 1996 ("ERA"). This provides for unpaid leave due to unexpected disruption or termination of care arrangements for dependents.

Facts

The employee was advised on 8 December that her childminder would be unavailable for 22 December, she tried to make alternative care arrangements but was unable to do so.

She requested the day off work from her employers under s57A (1) (d) of the ERA but they refused this request. The employer disciplined the employee after she stayed at home to look after her children.

The employment tribunal held she was subjected to a detriment for taking time off when s57A (1) (d) permitted a "reasonable" amount of time off to be taken where "necessary".

Judgment

The employer appealed to the Employment Appeal Tribunal ("EAT"). The EAT looked at the meaning of the words "necessary" and "unexpected" in s57A (1).

The employer argued that their employee had been notified of her childminders unavailability two weeks before and termination of care was not therefore unexpected. In addition s57A (1) (d) should only apply to situations which arose suddenly or in an emergency.

The EAT did not agree with this.

It found the time which had elapsed between the employee finding out about the up-coming disruption of care arrangements is relevant to the question of whether it was necessary for the employee to take this time off, but it was not relevant to whether the leave was "unexpected" or not.

If an employee has not taken appropriate steps to make alternative arrangements and has had sufficient time in which to do so the Tribunal will be unlikely to find that it is "necessary" for the employee to take time off. If the time which passes between an employee finding out about the risk of disruption and the actual disruption is very short it will be easier to find it was necessary for the employee to take the time off.

Other factors to be taken into account when considering the necessity for time off will be the nature of the disruption, the availability of alternatives, finance and time.

On consideration of the word "unexpected", the EAT felt this should not include an aspect of time nor was there a requirement to insert the words sudden or in an emergency into s57A (1) (d). It therefore dismissed the Employers appeal.

Comment

Employers should therefore no longer assume that the nature of unexpected leave is restricted to disruption or termination of care in situations which arise suddenly or in an emergency.

This article copyright © 2008 Steeles Law llp. All rights reserved.