News & Views

Employment Law General Update – October 2024

Anne-Marie Pavitt,
30th October 2024

Employment Law

Big changes are afoot this month with the introduction of the new Labour government’s Employment Rights Bill, aiming to fix problems perceived by the Labour party during their long stint in opposition, such as addressing one-sided flexibility, supporting more family friendly rights and prioritising fairness, equality and wellbeing of workers, ensuring fair pay, modernising trade union legislation and improving enforcement of employment rights. Consultation over the Bill will start now and continue in 2025, with the aim to implement the changes in 2026. We also bring you updates on sexual harassment, proposed employment rights for parents of still-born children and those born prematurely, guidance on the new Tipping Act, and a change in equality office.

Legislation: Government publishes Employment Rights Bill
Protection at Work: The Worker Protection (Amendment of Equality Act 2010) Act 2023 to comes into force on 26 October 2024 and EHRC updates its harassment guidance and publishes eight-step guide for employers on preventing sexual harassment at work
Parents: New private members’ bill on Still-Birth and leave for Neo-natal care
Pay: New Tipping Act and supplementary Code of Practice comes into force – guidance available
Equality: Office for Equality and Opportunity replaces the Equality Hub

Legislation: Government publishes Employment Rights Bill

Background: In September 2021, the Labour Party first introduced its plan for working people in its ‘A new deal for working people’, launched at the Labour Party Conference. The document underwent several iterations, with the final version, Labour’s Plan to make work pay: Delivering a new deal for working people (New Deal), published just prior to the release of the manifesto in June 2024. The Labour Manifesto reiterated a number of the promises set out in the New Deal document and stated that the New Deal would be implemented in full within the first 100 days of the Labour government. The King’s Speech on 17 July 2024 confirmed that Labour’s plans would be implemented through the Employment Rights Bill 2024 (Bill) and the Equality (Race and Disability) Bill 2024. The Employment Rights Bill 2024 was published on 10 October 2024.

When will the Bill come into force? Commencement regulations will be required to bring provisions into force, with the exception of provisions on trade unions and industrial action, which will come into force two months from the day on which the Act is passed, and the repeal of the Strikes (Minimum Service Levels) Act 2023 and related provisions, which will come into force on the date the Act is passed.

What does the Bill plan to do? The Bill implements a large number of the reforms promised in the Labour Party’s New Deal document. Alongside the Bill, the government has also published a policy document entitled Next Steps to Make Work Pay (Next Steps) and a set of explanatory notes. The document sets out the government’s plan generally as well as the next steps in implementation for many of the measures.

Laid out below is a summary of the current position, the changes promised prior to the Bill and the expected reforms in relation to the measures set out in the Bill.

Zero hours and ‘low hours’ contracts: Zero-hour contracts are contracts of employment which lack a minimum number of guaranteed working hours and which do not require a minimum commitment from the employee. This means the working hours of an individual are unpredictable and may vary wildly from week to week. Although, individuals on zero-hour contracts do have a number of statutory protections, these are based solely on employment status. At present there is no definition as to what ‘low hours’ means. This will be the subject of consultation.

In order to provide more security for individuals on zero-hour contracts, the Labour Party promised to:

ban ‘exploitative’ zero hours contracts;
ensure a right to a contract reflecting the number of hours regularly worked and is likely to be based on a 12-week reference period;
ensure workers get reasonable notice of any shifts or working time changes, with proportionate compensation for cancelled or shortened shifts;
introduce anti-avoidance measures; and
end ‘one sided’ flexibility by ensuring all jobs provide a baseline level of security and predictability.

The Bill sets out a right to guaranteed hours where a worker regularly works more than those hours. The guaranteed hours are calculated according to a reference period, which is expected to be 12 weeks. Employers will be required to make an offer of guaranteed hours to workers at the start of employment and at the end of each reference period. Workers can also submit claims to the employment tribunal where an employer has failed to comply with their duty to offer guaranteed hours, or where that offer does not comply with the necessary requirements.

The Next Steps document states that the government intends to consult on the details and to ensure the Bill’s provisions on zero hours contracts are effectively and appropriately applied to agency workers.

Fire and re-hire: Currently, employers wishing to introduce changes to the terms and conditions of an employment contract have the option of terminating the contract (with the requisite notice) and offering immediate re-engagement to the affected employee on new terms. While in government, the Conservative party introduced a statutory Code of Practice on dismissal and re-engagement with guidance on engaging in meaningful consultation and exploring alternatives. However, the Labour Party have since committed to ending ‘fire and rehire’ practices entirely in addition to reforming the existing fire and rehire Code and introducing more effective remedies against abuse.

In place of the Code of Practice, clause 22 of the Bill inserts a new section 104I into the Employment Rights Act 1996, which makes a dismissal unfair where the reason for the dismissal is that:

the employer sought to vary an employee’s contract and the employee did not agree, or
the employer sought to employ another person or re-engage the employee under a varied contract to carry out substantially the same duties.

This will not apply where the employer shows that the reason for the variation was to eliminate, prevent or significantly reduce, or significantly mitigate the effect of, any financial difficulties which at the time of the dismissal were affecting, or were likely in the immediate future to affect, the employer’s ability to carry on the business as a going concern or otherwise to carry on the activities constituting the business, and in all the circumstances the employer could not reasonably have avoided the need to make the variation.

Unfair dismissal qualifying period: Under section 108(6) of the Employment Rights Act 1996 the right not to be unfairly dismissed generally only arises where the employee has been continuously employed for a period of at least two years; however the rule is subject to a number of statutory exceptions. The Labour Party has promised to remove the two-year qualifying period for unfair dismissal claims, making it a ‘day one’ right.

The Bill will repeal s.108 of the Employment Rights Act 1996 and remove the two-year qualifying period. However, there will be a new ‘initial period of employment’ (or ‘probationary period’) during which the employer can dismiss an employee for certain reasons, subject to following a specified procedure. The length of the initial period and the details of the procedure will be subject to consultation—see Probationary periods below.

Sick pay (SSP): SSP is currently available to employees who are deemed to have been too ill to undertake any work for a period of at least four consecutive days. Employees must also earn above the lower weekly earnings limit (currently at £123) in order to qualify for SSP. The Labour Manifesto laid out the Party’s commitment to removing the qualifying period for statutory sick pay making it also a ‘day one’ right and removing the lower earnings limit. The Bill reflects both these promises in clauses 8 and 9.

The government will consult on the percentage replacement rate for those earning below the current flat rate of SSP, before bringing it into force as an amendment to the Bill. Furthermore, the Next Steps document states that the new Fair Work Agency will be given responsibility for ensuring SSP enforcement.

Parental leave: Parents of a child (whether born to the parents or adopted) are entitled to take up to 18 weeks of unpaid leave to care for that child at any time before the child’s 18th birthday. Currently parents must have worked continuously for an employer for at least one year to qualify for parental leave. The Bill will make parental leave a ‘day one’ right.

Probationary periods: As noted above, the Bill introduces the concept of an ‘initial period of employment’ (or ‘probationary period’) where dismissals for specified reasons will not be considered unfair. The government has further committed in the Next Steps document to consulting on the length of that initial statutory probation period and to consult on how it interacts with ACAS’s Code of Practice on disciplinary and grievance procedures to ensure that ‘day one’ rights will not be affected by the statutory probation period.

Flexible working: The Employment Rights Act 1996 provides employees with a statutory right to request certain specified changes to their employment contract. However. employees must have had at least 26 weeks’ of continuous service in order to qualify for the right. Earlier legislative changes were made from 6 April 2024, including making the right to request a day one right. However, the grounds upon which an employer can reject a request remain broad.

The Bill introduces a reasonableness requirement into an employer’s decision not to grant flexible working requests, and requirement for the employer to explain to the employee why they consider it reasonable to refuse the request.

Protection for new mothers: Currently, dismissal on the grounds of pregnancy or maternity will be deemed to be an automatically unfair dismissal. This means that an employee dismissed under these circumstances does not require the two years of continuous employment ordinarily needed to bring a claim in the employment tribunal. A woman who takes ordinary maternity leave is also entitled to return to the ‘same job’ at the end of that leave unless that job is no longer available.

The Plan to make work pay also included a promise to strengthen these protections by making it unlawful, except in specified circumstances, to dismiss a woman who has had a baby for six months after she returns to work.

The Bill provides the Secretary of State with the power to make provision for regulations restricting dismissal of an individual during pregnancy or for a period after pregnancy.

Paternity leave: Currently an employee may take paternity leave to support a mother or adopter in taking care of a new child, subject to (among other things) having at least 26 weeks’ qualifying employment. Under the Bill, paternity leave will become a ‘day one’ right.

Bereavement leave: Employees are entitled to Parental bereavement leave (PBL) following the death of a child if they meet the requisite parental relationship conditions and comply with the notice requirements. PBL is a ‘day one’ right; however it is currently only available to employees. The Bill extends the right to take PBL to any ‘bereaved person’. PBL will no longer be limited to circumstances involving the death of a child. A bereaved person will be entitled to take leave for the death of any person as long as they meet the other relevant conditions set out in the regulations.

Equality action plans: Amendments to the Equality Act 2010 made by the Bill will require large employers (with 250 employees or more) to publish equality action plans showing the steps that the employer is taking in relation to their employees with regard to prescribed matters related to gender equality, and to publish prescribed information relating to the plan. These will need to cover addressing the gender pay gap and supporting employees going through the menopause.

Fair Work Agency: The Labour Party has committed to amalgamating the HMRC National Minimum Wage unit, the Employment Agency Standards Inspectorate and the Gangmasters Labour Abuse Authority into a single enforcement body known as the Fair Work Agency. The Bill establishes the Fair Work Agency which will be responsible for:

minimum wage and statutory sick pay enforcement;
the employment tribunal penalty scheme;
labour exploitation and modern slavery; and
enforcement of holiday pay policy (a new responsibility, which was not originally included in the New Deal document).

Fair pay agreements for social care workers: The Labour Party promised to consult on a new Fair Pay Agreement to create a New Deal for Social Care Workers. The Bill provides for the creation of an Adult Social Care Negotiating Body with a remit over remuneration, terms and conditions of employment and any matters specified by the Secretary of State, for social care workers. Agreements over remuneration which have been ratified by the Secretary of State must be paid in accordance with the agreement and any other term will have effect as a term of a worker’s contract. A consultation on how the Fair Pay Agreement should work is promised ‘soon’.

School support staff: The School Support Staff Negotiating Body, the pay body for school support staff, was abolished some time ago. The Labour Party stated that it would reinstate the Body, and task it with establishing a national terms and conditions handbook, training, career progression routes and fair pay rates for support staff to help to address the recruitment and retention crisis. The Bill re-establishes the School Support Staff Negotiating Body.

Trade unions: The Employment Rights Bill makes provision for changes to trade union law relating to:

a worker’s right to a statement of trade union rights;
a trade union’s right of access to a workplace;
trade union recognition;
members’ contributions to political funds, and public sector check-off arrangements;
time off rights for trade union officials, learning representatives and union equality representatives; and
blacklisting.

An employer will be required to give a worker a written statement that the worker has a right to join a trade union at the same time as the employer gives the worker a written statement of employment particulars. Secondary legislation will stipulate what information must be included in the statement, the form the statement must take and the manner in which the statement must be given.

The Employment Bill introduces a new framework for trade unions to request physical access to an employer’s workplace for the purposes of meeting, representing, recruiting or organising workers, and/or facilitating collecting bargaining. Access agreements are to be negotiated in the first instance between the employer and the trade union, with a referral to the Central Arbitration Committee provided for if agreement cannot be reached.

Thresholds required for a trade union to qualify for, and achieve, statutory recognition will be amended, with double thresholds removed where relevant and replaced by a simplified requirement for unions to demonstrate appropriate levels of support. In relation to individual contributions to a political fund of the trade union, the default position will be that individual members will be contributors to the political fund unless they specifically opt out (rather than the other way around, which is the current position.

Changes to the check-off arrangements for public sector workers introduced by s.15 of the Trade Union Act 2016 on 9 May 2024 are to be repealed.

Where an employer permits an employee or a learning representative to take time off for carrying out their duties under the Trade Union and Labour Relations (Consolidation) Act 1992 (ss.168 and 168A), it will also be expected, if requested, to provide reasonable accommodation and other facilities for carrying out those duties.

A new right for reasonable time off for union equality representatives is introduced to support duties related to promoting equality in the workplace.

Secondary legislation will be introduced to extend blacklisting protections; it will be unlawful not only to compile lists of trade union members etc, but also to use such lists for the purposes of discrimination in relation to recruitment or in relation to the treatment of workers, and/or to sell or supply such lists for those purposes.

Industrial action: Changes are proposed in relation to:

balloting and notification requirements for lawful industrial action
lawful picketing;
detriment and dismissal for participating in lawful industrial action; and
restrictions on those working in regulated services from participating in industrial action.

Ballot participation thresholds will be done away with and support thresholds for industrial action will be the majority of those voting in the ballot. Additional balloting thresholds for those engaged in public services will also be done away with. Information that must be included on the voting paper in a ballot is to be significantly reduced and simplified. Provision is made for electronic balloting to be introduced.

The period of notice to be given to an employer to notify it of industrial action is to be reduced from 14 days to seven days.

Lawful picketing will no longer be dependent on the union supervision requirements contained in s.220A of the Trade Union and Labour Relations (Consolidation) Act 1992, which is to be done away with.

A new right for workers to be protected from detriment for participating in protected industrial action, or to deter them from doing so, is to be introduced, and protection against dismissal for participating in protected industrial action is to be extended.

The Strikes (Minimum Service Levels) Act 2023 is to be repealed, and industrial action restrictions on workers working in services that have been designated ‘relevant’ services under the Act are accordingly lifted.

Further reform: In addition to the anticipated reforms announced in the Labour Party’s New Deal and Manifesto, the Bill includes some measures which had not previously been anticipated. Clauses 16–18 of the Bill contain new provisions on sexual harassment, expanding the duty to prevent sexual harassment set to come into force on 26 October 2024 under the Worker Protection (Amendment Of Equality Act 2010) Act 2023. The new sections introduce:

liability for harassment by third parties;
provision for disclosures about sexual harassment qualifying as a protected disclosure under S.43B of the Employment Rights Act 1996; and
the addition of specified steps that an employer must take to demonstrate that they have taken reasonable steps in the prevention of sexual harassment for the purposes of the legislation.

The government will also consult on lifting the cap of the protective award if an employer is found to not have properly followed the statutory collective redundancy processes and on the role interim relief could play in protecting workers in these situations.

As stated above, the Next Steps document provides a general timeline on the implementation of the measures and reforms set out in the Bill. The majority of the measures in the Bill are set to be brought in through commencement legislation, and a number will go through a consultation process before their eventual implementation. According to the Next Steps document, the government expects to start consulting in 2025, although the government is ahead of itself in this regard and launched four consultations on 21 October 2024. The four consultations, which run until early December 2024, seek views of the Bill’s measures relating to a new right to guaranteed hours for zero or low hours workers, collective redundancy consultation and ‘fire and rehire’ practices, trade union legislation and statutory sick pay. This means that any substantive reforms are unlikely to take effect much before 2026. This also means the Bill is likely to see some amendment before all the measures fully come into force.

The Next Steps document also refers to a number of reforms not included in the Bill which the government is nevertheless committed to introducing. These are:

a full review of the parental leave system;
a review of the implementation of carer’s leave and an examination of the benefits of introducing paid carer’s leave;
a consultation on workplace surveillance technologies;
consultations on the creation and implementation of a single ‘worker’ status;
a call for evidence on TUPE 2006 regulations and processes;
a review of health and safety in the workplace aimed at modernising guidance and regulations;
a joint consultation with ACAS on collective grievances;
the introduction of a new National Procurement Policy Statement aimed at reforming the public procurement ahead of the commencement of the Procurement Act 2023 in February 2025; and
an extension of the Freedom of Information Act 2000 to private companies that hold public contracts and publicly funded employers.

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Protection at work: The Worker Protection (Amendment of Equality Act 2010) Act 2023 to comes into force on 26 October 2024 and EHRC updates its harassment guidance and publishes eight-step guide for employers on preventing sexual harassment at work

The Worker Protection (Amendment of Equality Act 2010) Act 2023 comes into force on 26 October 2024. The Act will:

Introduce a duty on employers to take reasonable steps to prevent sexual harassment of their employees.
Give employment tribunals the power to uplift discrimination compensation by up to 25% where an employer is found to have breached the duty to prevent sexual harassment.

At present it’s only a duty to take ‘reasonable steps’, the new Employment Rights Bill already includes a change to ‘all reasonable steps’ which no doubt will come into force in due course. The Employment Rights Bill will also re-introduce employer liability for third party harassment in relation to all relevant protected characteristics under the Equality Act (sex, sexual orientation, age, disability, etc.)

Sexual harassment occurs where both:

A engages in unwanted conduct of a sexual nature.
The conduct has the purpose or effect of either violating B’s dignity, or creating an intimidating, hostile, degrading, humiliating or offensive environment for B.

The EHRC has published an updated technical guidance for employers on the steps they can take to prevent sexual harassment in the workplace. The EHRC has also published an eight-step practical guide to assist with this preventative duty, including developing an effective anti-harassment policy, using a reporting system that allows workers to raise an issue either anonymously or in name, and regularly monitoring and evaluating the effectiveness of an employer’s actions.

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Parents: New private members’ bill on Still-Birth and leave for Neo-natal care

The Still-Birth (Definition) Bill (a Private Members’ Bill sponsored by Liberal Democrat peer, Baroness Benjamin) received its first reading in the House of Lords on 14 October 2024. The Bill would amend the definition of still-birth to apply from 20 weeks into a pregnancy, rather than from 24 weeks as currently is the case, including for the purposes of entitlement to maternity allowance under section 35 of the Social Security Contributions and Benefits Act 1992.

Currently under the Neonatal Care (Leave and Pay) Act 2023 (which received Royal Assent on 24 May 2023) employees with responsibility for children receiving neonatal care will be entitled to receive up to 12 weeks of paid leave per year. Regulations bringing into force its main provisions are awaited.

The latest edition of HMRC’s Employer Bulletin confirms that from 6 April 2025 HMRC will begin to administer statutory neonatal care pay (SNCP). The Bulletin informs employers that SNCP:

is claimable in the first 28 days following the birth of a child after they have spent seven consecutive days in neonatal care

can be paid for a maximum period of 12 weeks but will allow some flexibility dependent upon individual parental circumstances and other statutory payments to which they may be entitled.

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Pay: New Tipping Act and supplementary Code of Practice comes into force – guidance available

On 1 October 2024, the Employment (Allocation of Tips) Act 2023 and statutory Code of Practice on fair and transparent distribution of tips came into force. Under the Act, employers must distribute tips in a ‘fair and transparent’ manner, passing all tips, gratuities, and service charges on to workers, without deductions. Failure to do so could result in employment tribunal claims by workers seeking to enforce their rights.

The Advisory, Conciliation and Arbitration Service (ACAS) has published guidance on tips and service charges in relation to the Act and supplementary Code of Practice which are both now in force. The guidance explains what the new law says, sharing tips fairly, and the obligation to have a written policy and to keep records. The guidance also covers which tips the law applies to, when tips must be paid, tronc systems and what happens if tips are not being paid correctly.

The DBT has also published non-statutory guidance for employers for employers on distributing tips fairly. The guidance is aimed at helping employers apply the statutory code of practice on fair and transparent distribution of tips, and applies to all sectors and businesses where tips are received. The guidance is not part of the statutory Code of Practice, legal advice or an exhaustive account of what is acceptable under either the Employment Rights Act 1996 or the statutory Code of Practice.

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Equality: Office for Equality and Opportunity replaces the Equality Hub

The Equality Hub has been replaced by the Office for Equality and Opportunity. The Office for Equality and Opportunity will cover the overall framework of equality legislation in the UK, including disability policy, ethnic disparities, gender equality and LGBT+ rights.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.

News & Views

Mandatory Payrolling of Benefits from April 2026

Paul Webb,
13th February 2024

Tax

The reporting of benefits in kind (BiK) has transformed over the past few years. Gone are the days of paper based P11Ds, having been replaced by online reporting and the option of ‘payrolling’ BiKs through payroll systems.

On 16 January 2024, the government announced a package of measures to support its ambition to simplify and modernise the tax system, using the efficiencies of digital service to drive public sector productivity and to make the tax system simpler and fairer.

One of the measures announced was that the government will mandate the reporting and paying of Income Tax and Class 1A National Insurance Contributions (NICs) on benefits in kind, via payroll software from April 2026.

How it currently works

Currently, employers have two ways of reporting their BiKs:

To report via P11D submission to HMRC, annually, before the deadline of 6 July following the tax year in which the employee received the benefit. Payment of Class 1A employer national insurance contributions (NICs) must be paid before 22 July (if paying electronically). Using the information reported on the P11D, the employee pays the associated income tax through self-assessment, or it is collected by way of an adjustment to the employee’s tax code in the tax year after the benefits or expenses are received.

To payroll benefits, allowing benefits to be reported in real time through pay as you earn (PAYE), meaning no mid-year changes to tax codes as tax is deducted throughout the year. Class 1A employer NICs still need to be reported on P11D(b) by 6 July after the end of the tax year.

One of the drawbacks of the traditional, or legacy, P11D submission is that an employee could wait over a year before seeing any tax related benefits they’re receiving being deducted from their pay. Any change to an employee’s tax code being made so long after the benefit has been received often causes confusion.

Conversely, the payrolling of benefits allows for the tax on BiKs to be collected in real-time via the employee’s pay, reducing the confusion for the employee, however the system is currently not fool-proof and currently employer-provided living accommodation, and interest free/low interest (beneficial) loans cannot be payrolled.

What should employers consider now?

Less flexibility – employers will no longer have the option to payroll only certain BiKs or employees, with all benefits requiring to be reported. This could have a direct cashflow impact on the employee.
Data management – employers will need to be able to easily access the reportable monthly data so they can provide it to the payroll department ahead of payroll processing cut-off dates.
Increased PAYE risk – compulsory reporting of benefits increases the risk of monthly non-compliance and tax driven penalties.
Employee impact – the employee might experience a cashflow impact in 2026/27 when the mandatory payrolling of BiKs and PAYE code adjustments for the prior year overlap.
Employee communication – upcoming changes to the BiKs reporting system will need to be communicated to employees.
Payroll impact – can your current payroll software/outsources payroll provider cope with the change? Will there be an increase in fees?
Process impact – it has yet to be determined how beneficial loans and employee-related accommodation benefits will be reported. What will the impact be for leavers, if processed before payroll cut off?

Next steps

HMRC has confirmed that government ministers will not be putting the change out to public consultation, but instead will be liaise with key stakeholders such as the Chartered Institute of Payroll Professionals (CIPP), to discuss the forthcoming change at length, ahead of implementation come April 2026.

CIPP are seeking to address the following key issues:

Ensuring calculation methods for employer-provided living accommodation and beneficial loans are updated and can be processed via payroll software.
Ensuring working sheets are available for employers and agents to help with calculating values to be used.
Being mindful of the changes required for payroll systems, and the time taken for software companies to implement the changes.
Pushing for real-time payments of Class 1A employer NICs, to eliminate the need for the P11D(b).

Let’s Talk

If you would like any further information on the changes and how they might affect you or your business, please do not hesitate to contact your usual Dixcart UK contact or enquire at hello@dixcartuk.com

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Employment Law Case Update – January 2024

Anne-Marie Pavitt,
26th January 2024

Employment Law

We welcome you back into the land of employment law cases with a few of cases from the back end of 2023. Learn how the ACAS Code plays a crucial role in handling whistleblowing cases, and its implications for compensation uplifts and the limitations of contractual terms. We take a look at how future discrimination claims can be waived when done correctly in a settlement agreement, and evaluate how timings should be considered when looking at constructive dismissal cases, particularly where the claimant has a long employment history and there have been efforts at negotiation.

Whistleblowing: Using the ACAS Code for grievances and compensation uplifts, and whether contractual terms can limit losses
Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised
Constructive Dismissal: Was resignation too slow to have been ‘the last straw’?

Whistleblowing: Using the ACAS Code for grievances and compensation uplifts, and whether contractual terms can limit losses

In SPI Spirits (UK) Ltd & Anor v Zabelin [2023] EAT 147, the claimant was the Group Chief Investment Officer for the first respondent company (SPI Spirits). He agreed a 30% pay cut from April to June 2020 because of the effects of the coronavirus (COVID-19) pandemic on the business. When the first respondent said that the pay cut was being extended to at least 1 September 2020 the claimant raised, in an email of 4 June 2020 and at a meeting on 5 June 2020, various issues including alleging that the pandemic was being used as an excuse to cut pay and that employees were being intimidated. On 8 June 2020 the claimant had a telephone discussion with the second respondent (Shefler), the majority shareholder in the group, who suggested that the claimant should resign if he didn’t agree to proposed changes to bonuses. When the claimant queried why he should resign the second respondent dismissed him. The claimant brought claims including of automatic unfair dismissal and detriment on the grounds of having made whistleblowing protected disclosures (including regarding (a) the claimant’s pay; (b) the claimant’s 2020 bonus; (c) staff welfare; and (d) coronavirus pretence).

The outcome of the case was that the EAT confirmed that a grievance must be in writing for the ACAS Code on Disciplinary and Grievance Procedures to apply but, once that has occurred, if new grievances arise they do not each have to be put in writing for the Code to be engaged, unless there is a ‘material change’ in the nature or scope of the complaint or redress sought such that fairness requires it. In addition, the uplift to compensation for an employer’s failure to follow the ACAS Code also applies to awards made against individuals if the relevant individual was responsible for the failure. Finally, contractual terms limiting loss will not be upheld if they produce an outcome which would have the same effect as disapplying or limiting a statutory provision, according to the EAT.

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Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised

In Bathgate v Technip Singapore PTE [2023] CSIH 48 the Inner House of the Court of Session held that the various protections for the employee built into section 147 of the Equality Act 2010 do not exclude the settlement of future claims so long as the types of claim are clearly identified and the objective meaning of the words used encompassed settlement of the relevant claim. Section 147 of the Equality Act 2010 allows claims for discrimination to be settled using a settlement agreement provided that the settlement agreement relates to the ‘particular complaint’. Accordingly, a settlement agreement can relate to a future complaint if there is sufficient description of it in the claims waived.

There has been significant uncertainty for some time about whether or not future claims an employee might acquire against their employer but which have not yet arisen could, with the correct wording, be effectively waived as part of a settlement agreement. This decision by the Inner House of the Court of Session (the Scottish equivalent to the Court of Appeal) comes unequivocally to the conclusion that future claims can be waived in a settlement agreement so long as they are sufficiently identified in accordance with the requirements in Hinton v University of East London [2005] EWA Civ 532.

Whilst employers would be wise to consider including future claims in settlement agreements, those representing individuals may try to exclude future claims. However, it should be noted that the decision in this case may not necessarily be followed in England. While decisions from the Inner House of the Court of Session are often considered by employment tribunals and the Employment Appeal Tribunal (EAT) in England, they are not strictly binding, so caution should be exercised.

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Constructive Dismissal: Was resignation too slow to have been ‘the last straw’?

In Leaney v Loughborough University [2023] EAT 155, the claimant had been a university lecturer and warden of a halls of residence with over 40 years’ service at the University. A student had made a complaint against him in 2018, which he disputed and had led to disciplinary action and in turn a grievance being raised by the claimant. He subsequently resigned as warden in December 2019, and asked several times for a grievance appeal to be held. They told him several times to draw a line under the matter but the claimant persisted. On 29 June 2020, he was told that the university could not look at the issue any further. There followed a period of negotiation between solicitors but due to be back at work that autumn, the claimant was so anxious he was signed off sick by his GP on 10 September 2020, and then resigned with notice on 28 September 2020, thereafter claiming constructive unfair dismissal, alleging a cumulative breach of the implied duty of trust and confidence.

The claimant claimed the notification he had received on 29 June 2020 was the ‘last straw’. The tribunal held that he had affirmed the contract of employment during the three months between 29 June, and his resignation on 28 September 2020 because he should have tendered his resignation prior to this.

The EAT disagreed with the tribunal’s approach and remitted the issue of affirmation for reconsideration, holding:

that the tribunal’s focus should not necessarily be on how much time has passed when considering whether affirmation has taken place, but should take into account all the surrounding facts and circumstances should be weighed.
where there has been a period of delay then length of service should be taken into account in deciding whether the contract has been affirmed but it is fact sensitive. It is understandable that an employee with long service may take longer to consider their position (without necessarily having affirmed) before removing themselves from a secure job, but the surrounding context is vital and should be applied on an case-by-case basis.
a period of negotiation before resignation is relevant. Negotiations could be an employee’s attempt to give the employer the opportunity to ‘put things right’ before resigning and therefore such a delay may not necessarily amount to affirmation of the contract.

His claim was dismissed on the basis that, between the date of the last matter that could potentially be relied upon as a last straw, and the date of resignation, he had affirmed the contract. Having regard to the facts found, and the matters relied upon by the claimant as relevant to the question of whether there had been affirmation, the tribunal erred in its approach to affirmation. The EAT found the tribunal had focused incorrectly on things that did not happen (the Claimant did not delay his resignation because of student exams and did not state that he was working under protest), which, if they had happened, might have pointed away from affirmation. Instead, they should have honed in on what conduct there had been which might have amounted to affirmation. The EAT therefore remitted the matter to the same tribunal for fresh consideration of that issue, in light of the facts found, and, as necessary, the further issues to which the complaint gave rise.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – July 2023

Employment,
25th July 2023

Employment Law

This month there has been a lot of movement in rights at work – with a new jobs ‘passport’ for injured or disabled veterans, a private member’s bill to bring in a definition of ‘bullying’ at work, a consultation launched on the Disability Action Plan, the government’s response to the ethnicity pay reporting consultation and ACAS is consulting on a new draft Code of Practice to cover flexible working requests. There is also a consultation from the DBT on the future of the labour market enforcement strategy and ACAS’s latest annual report on how much it is needed.

Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans

Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025

Rights at Work: Parliament introduces bill to define bullying at work

Disability: DWP launches consultation on proposals for Disability Action Plan

Ethnicity Pay Reporting: Government publishes response to ethnicity pay reporting consultation

ACAS: New consultation published on new draft Code of Practice on flexible work requests

ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans

The Ministry of Defence (MoD) and Department for Work and Pensions (DWP) has announced a new Adjustment Passports scheme to help smooth the way for injured or disabled Armed Forces to re-enter civilian work life. This scheme aims to remove barriers to the labour market by providing a transferable record of workplace adjustments, removing Access to Work assessments and reassessments, thus unlocking a pool of talent for employers and businesses to assist in economy growth. Guidance for the scheme has also been published.

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Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025

The Department for Business and Trade (DBT) has published a consultation seeking responses to assist the Director of Labour Market Enforcement, Margaret Beels, in putting together the labour market enforcement strategy for 2024-25. The role of Director of Labour Market Enforcement was created in 2017 to bring together a coherent assessment of the extent of labour market exploitation, identifying routes to tackle exploitation and harnessing the strength of the three main enforcement bodies: HMRC National Minimum Wage; the Gangmasters and Labour Abuse Authority (GLAA); and the Employment Agency Standards Inspectorate (EAS).

Each year the Director submits a Labour Market Enforcement Strategy to Government to set priorities for the three main enforcement bodies.

Both the interim DLME Strategy 2022 to 2023 (published in March 2023) and the full DLME Strategy for 2023 to 2024 (awaiting clearance from government) proposed four themes as a structure for thinking about identifying and tackling labour market non-compliance. These four themes are:

Improving the radar picture to have a better understanding of the non-compliance threat.
Improving focus and effectiveness of the compliance and enforcement work of the three bodies under my remit
Better Joined-up Thinking to minimise the opportunities for exploitation of gaps in employment protection.
Improving engagement with employers and support for workers

The DLME Strategy for 2024 to 2025 will continue to build on these themes and this call for evidence seeks information about a number of these areas and provides an opportunity for respondents to draw to our attention evidence that they have of other areas where they observe significant risk of worker exploitation.

The consultation closes on 8 September 2023.

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Rights at Work: Parliament introduces bill to define bullying at work

Labour MP Rachael Maskell recently introduced a Private Members’ Bill to define workplace bullying and introduce legal duties on employers to prevent it, and it passed its first reading in Parliament on 11 July 2023.

She cited research from the Trades Union Congress in 2019 that estimated one quarter of employees are bullied at work, with most people who say they are bullied never reporting it. Maskell told the House of Commons. ‘There’s no legal definition, no legal protection, no legal route to justice, and without protection, many will leave their employer’.

If adopted, the Bill would provide a legal definition of ‘bullying’ in the workplace for the first time in the UK. Employees would be able to bring bullying claims to an employment tribunal and employers that fail to implement a statutory ‘respect at work code’ would face sanctions. The Equality and Human Rights Commission would also have powers to investigate systemic bullying damaging workplace cultures.

Maskell said the Bill would mean the definition of bullying by the workplace mediator ACAS as ‘offensive, intimidating, malicious, insulting or humiliating behaviour’ would be extended into statute and the usual method of determining compensation for injury to feelings would be applied. But its main goal is establishing a minimum standard for workplace conduct and discouraging managers who use their power over colleagues to ‘denigrate and destroy’, Maskell said.

The Bill follows bullying claims against former Justice Secretary Dominic Raab, who resigned after an investigation found he had belittled staffers. Lawyers said at the time that the lack of a legal definition of bullying made it hard but necessary to set expectations around workplace conduct.

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Disability: DWP launches consultation on proposals for Disability Action Plan

The Department for Work and Pensions (DWP) has launched a consultation on the government’s Disability Action Plan. The plan involves raising awareness of technology for disabled people, mandatory disability awareness training for taxi drivers, autism-friendly programmes for cultural and heritage sites and ensuring businesses are aware of disabled people’s needs. The plan is designed to make the UK a more inclusive society in the long term and to facilitate immediate and practical measures to improve disabled people’s lives for the better. The consultation will close on 6 October 2023.

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Ethnicity Pay Reporting: Government publishes response to ethnicity pay reporting consultation

The UK government has published a response to the ethnicity pay reporting consultation which aimed to gather views on what information should be reported, who should report it, and the next steps for consistent and transparent reporting. The government has concluded that, while ethnicity pay gap reporting can be a valuable tool to assist employers, it may not always be the most appropriate mechanism for every type of employer. Therefore, the government has confirmed that, as set out in the ‘Inclusive Britain’ report in 2022, it will not be legislating to make ethnicity pay reporting mandatory at this stage. Instead, the government has produced guidance (which was published in April 2023) to support employers who wish to report voluntarily.

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ACAS: New consultation published on new draft Code of Practice on flexible work requests

The Advisory, Conciliation and Arbitration Service (ACAS) has published a consultation on a new draft Code of Practice on handling flexible working requests. The new draft code is aimed at addressing the significant changes in ways of working since the current ACAS code was published in 2014. It is also designed to take into account anticipated changes to the Employment Rights Act 1996 around flexible working. The consultation closes at 11:59pm on 6 September 2023.

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ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

ACAS has published its annual report for 2022 to 2023, revealing a greater demand for its dispute resolution services. Key facts and figures include highlighted in this year’s report include:

ACAS’s intervention in 621 collective disputes between employers and groups of workers, a 22% increase to the previous year
105,754 notifications for early conciliation and ACAS staff finding a resolution in over 72,000 cases
over 14.4 million visits to the ACAS website
649,179 calls from employers and employees across Great Britain to the ACAS helpline

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – May 2023

Employment,
29th May 2023

Employment Law

This month’s news provides an update on the effect of the Retained EU Law Bill and the scrapping of the sunset clause, a new smart regulation from the DBT, a report on the post-pandemic economic growth in the UK labour markets, new guidance from ACAS on both managing stress at work and making reasonable adjustments for mental health at work, a new podcast from the HSE to support disabled people in the workplace and a consultation from the EBA on the benchmarking of diversity practices. Lastly, we have the results of research carried out on unfair treatment of parents following fertility treatment.

Brexit: Government scraps the proposed sunset clause from the Retained EU Law Bill and Minister confirms effect of the Bill on equality and employment rights
Employment Law: Department for Business and Trade – Smart regulation unveiled to cut red tape and grow the economy
Flexible Working: House of Commons Committee report on post-pandemic economic growth in UK labour markets
Health at Work: ACAS publishes new guidance on managing stress at work and making reasonable adjustments for mental health at work
Disability: HSE launches podcast to support disabled people in the workplace
Diversity: EBA publishes consultation on guidance on benchmarking of diversity practices
Sex Discrimination: Research reveals unfair treatment at work after fertility treatment

Brexit: Government scraps the proposed sunset clause from the Retained EU Law Bill and Minister confirms effect of the Bill on equality and employment rights

On 10 May 2023, the government announced that it will scrap the proposed sunset clause from the Retained EU Law (Revocation and Reform) Bill. As we have previously reported in our Employment Law News, the sunset clause would have meant that most retained EU law in secondary legislation would have been revoked at the end of 2023. Instead at least 600 pieces of retained EU law will be set out in a revocation schedule, which can be found here. Any laws not listed in the revocation schedule will be retained automatically.

Meanwhile, the Department for Business and Trade has published a response to a letter by the Rt Hon Caroline Nokes MP, Chair of the Women and Equalities Committee, requesting further explanation about the Retained EU Law Bill’s effect on equality rights and protections. The response by the Rt Hon Kemi Badenoch MP, Minister for Women & Equalities, confirms that the Retained EU Law Bill does not intend to undermine equality rights and protections, employment rights or maternity rights in the UK. It sets out that most equality protections will remain unaffected, as they are provided for in primary legislation, in particular the Equality Act 2010 (to which no changes are expected because of the Bill) and any relevant secondary legislation and additional instruments will be considered.

It also highlights that where additional provision is required, the Bill enables the UK Government and the devolved governments to protect the rights and protections of UK citizens. This includes a restatement power which allows departments to codify rights into domestic legislation. The response emphasises that this power will secure rights and protections, by laying them out accessibly and clearly in statute.

Employment rights

The response sets out that the government does not intend to amend workers’ legal rights through the Bill, that the UK provides for greater protections for workers than are required by EU law and that the government remains committed to making sure that workers are properly protected in the workplace.

Parental leave

The response emphasises that the repeal of maternity rights is not and has never been government policy, and that the UK is in fact further along than the EU when it comes to maternity rights.

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Employment Law: Government’s “Smart regulation unveiled to cut red tape and grow the economy”

On the 10 May 2023 the Department for Business and Trade published its paper “Smarter regulation unveiled to cut red tape and grow the economy” which the government describes as “the first dynamic package of deregulatory reforms to grow the economy, cut costs for businesses and support consumers …”

The governments announcements include the following proposed amendments to employment law:

The government is proposing to remove retained EU case law that requires employers to record working hours for almost all.

Making rolled-up holiday pay lawful. Rolled up holiday pay is where an employer includes a sum representing holiday pay in an enhanced hourly rate rather than continuing to pay workers as normal when they actually take leave. This was ruled to be in breach of the Working Time Directive by the ECJ well over a decade ago.
The merger of annual leave (20 days derived from the EU’s Working Time Directive) and additional leave (being the additional 8 days holiday provided under the Working Time Regulations). Whilst this appears to be sensible it will be interesting to see how the European case law which specifically applies to the 20 days annual leave, such as what constitutes holiday pay and taking such holiday in the year in which it falls, is dealt with.
TUPE – there are proposals to do away with the need for elections of employee representatives for businesses with fewer than 50 employees or transfers of fewer than 10 employees.

The government has launched consultation on these points.

The government has also proposed limiting the length of non-compete clauses to three months. This will require the passing of legislation, which, the government says will be dealt with when parliamentary time allows.

So we wait to see exactly what legislative changes come about following these announcements.

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Flexible Working: House of Commons Committee report on post-pandemic economic growth in UK labour markets

A House of Commons Committee report says the government must reconsider the need for an Employment Bill in the upcoming King’s Speech to address gaps in employment protections. The government has two months to respond to the committee’s proposals which are on topics including the machinery of government with responsibility for labour market policy; technology and skills development; workers’ rights and protection; and older workers.

The report, which follows on from a Call for Evidence on the state of play in the UK Labour market post-Brexit and the COVID-19 pandemic, highlights that:

with 500,000 people having left the British workforce since the start of the pandemic, a shortage of labour weighs heavily on the potential for economic growth;
economic inactivity has risen among people aged 50 to 64 years;
the way in which the recommendations of the Taylor Review have been implemented has been fragmented and drawn-out;
the enforcement of labour market rules is under-resourced.

It calls on the government to:

consider establishing a Ministry of Labour and appoint a new Minister of State for Labour in the Cabinet, as well as a Cabinet Committee on Labour;
take various actions in respect of technology and skills;
reconsider the need for an Employment Bill in the upcoming King’s Speech to address gaps in employment protections;
consider new legal structures for flexible work that include appropriate rights and protections for workers;
provide more protection for workers from any damaging effects of night-time working;
pursue the creation of the planned single enforcement body which would clarify rights of redress for those most in need;
continue and expand support for older workers.

It also calls on businesses to:

be more open to create more flexible constructions of work;
offer more flexible working opportunities to benefit from a huge untapped pool of older workers and to assess whether their recruitment practices and workplaces are ‘ageist’.

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Health at Work: ACAS publishes new guidance on managing stress at work and making reasonable adjustments for mental health at work

Managing stress at work:

ACAS has published new advice for employers on managing stress at work after YouGov revealed 33% of British workers disagreed that their organisation was effective at managing work-related stress. YouGov was commissioned by ACAS and surveyed just over 1,000 employees in Great Britain. ACAS sets out that stress can be caused by demands of the job, relationships at work, poor working conditions and life events outside of work such as financial worries. An ACAS poll in March 2023 revealed that 63% of employees felt stressed due to the rising cost of living.

Advice for employers on managing stress at work include:

looking out for any signs of stress among staff. Signs include poor concentration, tiredness, low mood and avoiding social events;
being approachable available and have an informal chat with staff who are feeling stressed;
respecting confidentiality and being sensitive and supportive when talking to staff about work-related stress;
communicating any internal and external help available to staff such as financial advice if the cost of living is a cause of stress.

ACAS states that creating a positive work environment can make employees healthier and happier at work, reduce absence levels and improve performance.

ACAS advice on managing stress can be accessed here.

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Making reasonable adjustments for mental health at work:

ACAS has published new guidance for employers and workers on reasonable adjustments for mental health. ACAS states that ‘employers should try to make reasonable adjustments even if the issue is not a disability’. The guidance covers:

what reasonable adjustments for mental health are;
examples of reasonable adjustments for mental health;
what reasonable adjustments can be made for mental health;
requesting reasonable adjustments for mental health;
responding to reasonable adjustments for mental health requests;
managing employees with reasonable adjustments for mental health;
reviewing policies with mental health in mind.

ACAS has also published case studies exploring how different organisations have helped staff with reasonable adjustments for mental health.

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Disability: HSE launches podcast to support disabled people in the workplace

The Health and Safety Executive (HSE) has launched a new podcast aiming to help employers support disabled workers and those with long-term health conditions in the workplace. The podcast features discussion by host Mick Ord, former BBC Radio journalist, Moya Woolley, Occupational Health Policy Team Leader at HSE and Rebecca Hyrslova, Policy Advisor at Federation of Small Businesses (FSB); and offers advice for employers on how to create a supportive and enabling workplace, take an inclusive approach to workplace health, understand the work barriers that impact on workers, make suitable workplace adjustments or modifications, develop skills, knowledge and understanding, use effective and accessible communication, and support sickness absence and return to work.

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Diversity: EBA publishes consultation on guidance on benchmarking of diversity practices

The European Banking Authority (EBA) has launched a consultation on guidelines on the benchmarking of diversity practices including diversity policies and the gender pay gap pursuant to Articles 75(1) and 91(11) of the Capital Requirements Directive IV (Directive 2013/36/EU) (CRD IV) and Article 34(1) of the Investment Firms Directive (Directive (EU) 2019/2034). The EBA has been collecting data on diversity since 2015 based on information requests. The EBA hopes that the issuance of these guidelines will lead to a higher level of transparency regarding the EBA’s work on the topic of diversity and gender equality and will help improve the quality of the collected data as well as the awareness of all stakeholders on these topics. The new reporting format is expected to apply for the collection of data in 2025 for the financial year 2024. Responses are sought to the consultation by 24 July 2023.

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Sex Discrimination: Research reveals unfair treatment at work after fertility treatment

Pregnant Then Screwed published a press release during Infertility Awareness Week revealing the unfair treatment women face in the workplace due to their reproductive health. Research has revealed that of the 43% of women who informed their employer of their fertility treatment, one in four did not receive any support from their employer. One in four women also experienced unfair treatment because of undergoing fertility treatment. Unfair treatment was also experienced by 22% of women who disclosed their pregnancy loss to their employer while 6% of partners who disclosed the same faced negative treatment.

The press release confirms Pregnant Then Screwed will be launching a new programme to help employers deal with reproductive health issues in the workplace better. They will be hosting a Women in the Workplace seminar for businesses to find out more about the new training and accreditation scheme which signals fertility friendly employers. This free event will take place in June 2023.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – November 2022

Employment,
28th November 2022

Employment Law

This month’s news seems to be full of inequality as we report on the gender pay gap, perceptions and experiences of racism at work, menopause, striking transport workers, bias in recruitment, carer’s leave and new protection from redundancy measures for those on pregnancy-related leave.

Gender Pay Gap: ONS 2022 gender pay gap data published
Race Discrimination: 2021 survey considers perceptions and experiences of racism at work
ACAS: Survey finds 1 in 3 employers feel under-equipped to support women during menopause
Trade Unions: New Transport Strikes Bill introduced to House of Commons
Technology: Research suggests using AI to reduce bias in recruitment is counter-productive
Leave: Government backs Carer’s Leave Bill
Redundancy: Government backs Protection from Redundancy (Pregnancy and Family Leave) Bill

Gender Pay Gap: ONS 2022 gender pay gap data published

The Office for National Statistics (ONS) releases annual statistics on differences in pay between women and men by age, region, full-time and part-time work, and occupation as compiled from its Annual Survey of Hours and Earnings. The ONS analysis of the gender pay gap is calculated as the difference between average hourly earnings (excluding overtime) of men and women as a proportion of men’s average hourly earnings (excluding overtime) across all jobs in the UK. It does not measure the difference in pay between men and women doing the same job and is different from compulsory gender pay gap reporting.

The ONS encourages focus on long-term trends rather than year-on-year trends. It notes that the data for 2020 and 2021 was subject to uncertainty and should be treated with caution. This is due to earnings estimates being affected by changes in workforce composition and the furlough scheme during the COVID-19 pandemic, as well as disruption to data collection and lower response rates.

Over the past decade, the gender pay gap has fallen by approximately a quarter among full-time employees. In April 2022, the gender pay gap for full-time employees was 8.3%. While this is higher than the 2021 gap of 7.7%, it continues a downward trend since April 2019 when the gap was 9.0%.

In 2022, the occupation group for managers, directors and senior officials has seen the largest fall in its gender pay gap figure (10.6%) since the pre-pandemic April 2019 figure (16.3%). This reflects signs of more women holding higher-paid managerial roles. In terms of geography, the gender pay gap is higher in all English regions than in Scotland and Northern Ireland.

Other trends seen in 2021 remain:

The gender pay gap is much higher for full-time employees aged over 40 years (10.9%) than those aged below 40 years (3.2%).
Higher earners experience a much larger difference in hourly pay between the sexes than lower-paid employees.

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Race Discrimination: 2021 survey considers perceptions and experiences of racism at work

Following a survey of 1,193 UK employees (507 White, 419 Asian, 267 Black), Pearn Kandola, a business psychology consultancy, has published a new report, Racism at Work in the UK 2021. The survey replicated the approach previously taken by Pearn Kandola in 2018 (see Racism at Work Survey Result, 2018), asking participants about their perceptions and experiences of racism at work and actions their employers have taken to combat racism.

Of the employees surveyed, 74.8% considered racism to be a problem in the workplace. Of the 52.2% who had witnessed racism at work, 29.8% confronted the perpetrator, 22.4% reported the incident to a manager or HR department while 28.3% took no action.

Racism at work was experienced by 34% of the respondents. Black respondents were 15.1 times more likely than White respondents, and 1.9 times more likely than Asian respondents, to experience workplace racism. Asian respondents were 8.1 times more likely to experience racism at workplace than White respondents. These results suggested that the likelihood of Black and Asian employees experiencing racism at work had generally increased between 2018 and 2021. For White respondents it had decreased.

Almost half of employees worked for organisations that had taken action to promote greater racial equality at work (49.7%). Most frequently this involved anti-racism training and general awareness raising. Internal policies and procedures were changed both to make them more inclusive and to make it easier to report racism to senior colleagues.

The report recommendations include recognition that experiences differ both between and within racial groups, and for employees to be trained to become active bystanders who know how to challenge racism.

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ACAS: Survey finds 1 in 3 employers feel under-equipped to support women during menopause

ACAS has reported on the outcome of a survey in which it commissioned YouGov to ask British businesses how well equipped they felt their workplaces were to support women going through the menopause. Responses indicated that while 46% felt either very or fairly well equipped, 33% considered that they were either not that well equipped or not equipped at all, and 21% of respondents did not know. With regard to confidence in managers having the necessary skills to support staff, 46% felt either very or fairly confident, 37% were either not very or not at all confident and 17% did not know.

ACAS advises that employers:

Develop a menopause policy that explains how the menopause can affect people differently and what support is available.
Provide awareness training for managers on the menopause and how to deal with it sensitively and fairly.
Consider making practical changes at work to help staff manage their symptoms, such as the availability of cold drinking water and temperature control.

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Trade Unions: New Transport Strikes Bill introduced to House of Commons

On 20 October 2022, the Transport Strikes (Minimum Service Levels) Bill had its first reading in the House of Commons. The Bill is intended to balance the right to strike with ensuring people can commute to work and make vital journeys to access education and healthcare during strikes. It will enable employers to ensure minimum service levels in specified transport services during strikes by requiring sufficient employees to work.

The Bill sets out the legal framework through which minimum service levels will be achieved using minimum service specifications, which include minimum service agreements, minimum service determinations and minimum service regulations. Employers and trade unions may negotiate and reach agreement on minimum service levels by entering into a minimum service agreement. Where the parties have failed to reach an agreement after three months, the matter will be referred to the Central Arbitration Committee (CAC) which will make a minimum service determination. The Bill provides that the Secretary of State may set minimum services levels through minimum service regulations which will apply where an agreement has not been entered into and a determination has not been made.

When a union gives an employer notice of a strike which relates to a specified transport service, and the employer and union are bound by a minimum service specification as regards the employer’s provision of that service, the employer may give a work notice to the union. That notice will identify the people required to work during the strike in order to ensure that minimum levels of service are provided and specify the work they will be required to carry out during the strike. Where an employer has given a work notice and the union fails to take reasonable steps to ensure that those identified in the notice do not take part in the strike, the union will not be protected from an action in tort by the employer.

The Transport Strikes (Minimum Service Levels) Act 2022, which will extend to England, Scotland and Wales, will come into force at the end of the period of two months beginning with the day on which it is passed.

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Technology: Research suggests using AI to reduce bias in recruitment is counter-productive

Cambridge University researchers have suggested that using Artificial Intelligence (AI) to reduce bias in recruitment is counter-productive in their report Does AI Debias Recruitment? Race, Gender, and AI’s “Eradication of Difference”.

The research considered the suggestion that using AI in recruitment can objectively assess candidates by removing gender and race from their systems and, in doing so, make recruitment fairer and help organisations to achieve their DEI goals and establish meritocratic cultures. The researchers built their own simplified AI recruitment tool, to rate candidates’ photographs for the “big five” personality traits: agreeableness, extroversion, openness, conscientiousness and neuroticism. However, they found the software’s predictions were affected by changes in people’s facial expressions, lighting and backgrounds, as well as their choice of clothing.

Recommendations made as a result of the research include developers shifting from trying to correct individual instances of bias to considering the broader inequalities that shape recruitment processes. Those, such as HR professionals, tasked with using technology must understand the limitations of AI and need suppliers to explain where AI is being used in their systems and how it is being used to evaluate candidates. The research also suggested that there remains an insufficient contribution from AI ethicists, regulators and policymakers in the scrutiny of AI-powered HR tools.

The Chartered Institute of Personnel and Development’s Resourcing and talent planning report (September 2022) found that only 8% of employers used AI to interpret job requirements and scan databases or the open web for relevant candidates and that 5% of employers used AI to either screen candidates (shortlisting based on a job description) or select them (through analysis of interview responses to match hiring criteria or using chatbots for first-stage interviews).

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Leave: Government backs Carer’s Leave Bill

On 21 October 2022, the government announced that it was backing the Carer’s Leave Bill, a Private Members’ Bill sponsored by Wendy Chamberlain MP. The Bill had its first reading in the House of Commons on 15 June 2022 and its second reading was passed with government support on 21 October 2022.

The Bill will introduce a new and flexible entitlement of one week’s unpaid leave per year for employees who are providing or arranging care. It will be available to eligible employees from the first day of their employment. They will be able to take the leave flexibly to suit their caring responsibilities and will not need to provide evidence of how the leave is used or who it will be used for which, it is hoped, should ensure a smooth process. Employees taking their carer’s leave entitlement will be subject to the same employment protections that are associated with other forms of family-related leave, meaning they will be protected from dismissal or any detriment as a result of having taken time off.

Between 16 March and 3 August 2020, the government consulted on its proposal to give employees who are also unpaid carers a week of unpaid leave each year to provide care. On 23 September 2021, the government response to the consultation confirmed that it would introduce a statutory right of up to one week of unpaid carer’s leave when Parliamentary time allowed.

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Redundancy: Government backs Protection from Redundancy (Pregnancy and Family Leave) Bill

On 21 October 2022, the government announced that it was backing the Protection from Redundancy (Pregnancy and Family Leave) Bill, a Private Members’ Bill sponsored by Dan Jarvis MP. The Bill had its first reading in the House of Commons on 15 June 2022 and its second reading was passed with government support on 21 October 2022.

Currently, the Employment Rights Act 1996 (ERA 1996) allows the Secretary of State to make regulations concerning redundancy “during” periods of maternity leave, adoption leave or shared parental leave. For example, under regulation 10 of the Maternity and Parental Leave etc Regulations 1999 (SI 1999/3312), before making a woman on maternity leave redundant, an employer must offer her a suitable alternative vacancy where one is available with the employer or an associated employer.

The Bill will amend the ERA 1996 to enable the Secretary of State to make regulations providing protection against redundancy “during or after” an individual taking the relevant leave. It will also add a new provision to the ERA 1996 allowing for regulations about redundancy “during, or after” a “protected period of pregnancy”. While the detail will be provided by the regulations, the explanatory notes to the Bill suggest that, by extending protection after a protected period of pregnancy, a woman who has miscarried before informing her employer of her pregnancy will benefit from the redundancy protection.

On 25 January 2019, BEIS published a consultation on extending this protection to apply from the date an employee notifies the employer in writing of her pregnancy, to six months after her return from maternity leave. The consultation also asked whether this protection should be extended to similar types of leave such as adoption leave and shared parental leave. On 22 July 2019, the government published its response to the BEIS consultation suggesting that it would bring forward legislation when Parliamentary time permitted.

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Employment Law General Update – September 2022

Employment,
26th September 2022

Employment Law

A change in prime minister has brought about some immediate changes to laws affecting employment law, such as the Bill on which laws will be retained from the EU, repeal of the off-payroll rules (IR35) and the dropping of the Bill of Rights Bill, which was set to replace the Human Rights Act. Sadly, two reports recently demonstrate that racism and gender discrimination persist at work, while FTSE 100 company chief executives are getting a massive pay rise. Meanwhile, ACAS has published new guidance on staff suspensions.

Brexit: Retained EU Law (Revocation and Reform) Bill 2022-23 introduced to House of Commons
IR35: Off-Payroll Rules to be repealed by April 2023
Human Rights: Bill of Rights Bill 2022-23 dropped by government
Equality: New TUC report highlights prevalence of racism at work
Discrimination: New report highlights persistence of gender discrimination in the workplace
Pay: Chief executives of FTSE 100 companies see average pay jump of 39%
ACAS: New guidance on staff suspensions published by ACAS

Brexit: Retained EU Law (Revocation and Reform) Bill 2022-23 introduced to House of Commons

On 22 September 2022, the Retained EU Law (Revocation and Reform) Bill 2022-23 was introduced to the House of Commons, and written ministerial statements were made summarising the Bill’s provisions. A full legal update on the Bill will follow. The written statements explain that the Bill includes provisions to:

Sunset retained EU law. Retained EU law in EU-derived secondary legislation and retained direct EU legislation will expire on 31 December 2023 unless otherwise preserved. Special features of EU law will be removed from retained EU law that remains in force after that date (assimilated law), ending the principle of the supremacy of EU law, general principles of EU law and directly effective EU rights on 31 December 2023. EU interpretive features will no longer apply to assimilated law. (The sunset date can be extended until 2026 for specified pieces of legislation.)
Reverse the priority currently given to retained direct EU legislation over domestic UK legislation passed before the end of the transition period when they are incompatible, with a power to amend the new order of priority to retain specific legislative effects where necessary in specific circumstances.
Give domestic courts greater discretion to depart from retained EU case law, and provide new court procedures for UK and devolved law officers to refer or intervene in cases involving retained EU case law.
Downgrade the status of retained direct principal EU legislation for amendment purposes so that it no longer has parity with Acts of Parliament.
Give the government powers to make secondary legislation so that retained EU law or assimilated law can be amended, repealed and replaced more easily, and enable the government (via Parliament) to clarify, consolidate and restate legislation to preserve its current effect.

The government’s news story added that all required legislation relating to tax and retained EU law will be made via the Finance Bill or subordinate tax legislation, and the government will introduce a bespoke legislative approach for retained EU law concerning VAT, excise, and customs duty in a future Finance Bill.

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IR35: Off-Payroll Rules to be repealed by 6 April 2023

In his autumn statement on 23 September, Chancellor Kwasi Kwarteng announced that the UK government will scrap the 2017 and 2021 reforms to the IR35 off-payroll working rules in the next Finance Act, aimed to be enacted on 6 April 2023. Addressing the House of Commons he said, “reforms to off payroll working have added unnecessary complexity and cost for many businesses.” This has come as a bit of a shock to many industry experts who have commented that it’s unheard of for a Chancellor to repeal primary tax legislation without consultation. It is just the reforms which are being axed, and not the IR35 system itself, which will likely be celebrated by independent contractors who have found the measures to have wrought havoc to their business and added unnecessary levels of additional work for both the contractors and the businesses that engage them.

IR35 reform in the public sector was introduced in 2017 meaning that public sector bodies become responsible for determining the IR35 status of contractors – the responsibility shifted from the contractor to the end client, rather than the contractor taking the responsibility. In addition, the reforms meant the liability also shifted from the contractor to the fee-paying party (often the recruiter) in the supply chain. IR35 reform in the private sector in 2021 mirrored this but applied only to medium and large businesses. Small companies remained exempt.

The repeal of the 2017 and 2021 reforms from 6 April 2023 doesn’t abolish IR35 but takes us back to the rules in place from 2000 (the Intermediaries Legislation). This puts the onus back on the worker to correctly assess their status and pay the correct amount of tax. It should be noted that for services provided before 6 April 2023, the current rules will still apply, even where the payment is made on or after 6 April 2023.

However, contractors may need to hold off rejoicing just for now. Some Tory Ministers are already claiming they may rebel against the next Finance Act if the pound falls below the dollar. Dave Chaplin, CEO of IR35 Shield, says: “When you read the financial impact of the repeal in the Government’s Growth Plan document, you’ll see that there are six billion pounds worth of reasons why all rejoicing would be premature, and why all parties in the supply chain should not be complacent as we approach April 2023, nor beyond.”

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Human Rights: Bill of Rights Bill 2022-23 dropped by government

On 7 September 2022, it was reported in the press that the Bill of Rights Bill 2022-23 had been dropped by the new government headed by Liz Truss and would not progress to its second reading, which had been scheduled to take place on 12 September 2022. The Bill would have repealed the Human Rights Act 1998 and reframed the UK’s legal relationship with the ECHR, to which the UK would have remained a signatory. Press reports suggest that the government is looking at different legislative options for reform.

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Equality: New TUC report highlights prevalence of racism at work

The TUC has published a report ‘Still Rigged: Racism in the UK Labour Market 2022‘, based on extensive polling, which shows that racism and racial inequality continue to be experienced in the workplace. In addition to racism impacting the types of work ethnic minority workers are employed to do, two in five people reported having experienced racism at work in the past five years. The most common types of racial harassment are racist jokes and banter (27%), being made to feel uncomfortable through use of stereotypes and appearance-based comments (26%), being bullied or harassed (21%), and racist remarks directed at the respondent or in their presence (21%). Most instances were perpetrated by fellow employees and 15% were made by a customer, client or patient. For one in six respondents, the racism was perpetrated by a manager.

Only 19% of people who experienced racist incidents reported the last incident to their employer. Nearly half of people who did not report instances of racist abuse (44%) said that they did not believe the issue would be taken seriously. Even when incidents were reported to an employer, action was taken to prevent future harassment in only 29% of instances.

The TUC has recommended that the government, employers, enforcement bodies and trade unions work together to deliver a “collective, pre-emptive response“. Specifically, the TUC suggests that the “floor of working rights” be improved for everyone, that employers have a duty to embed race equality practices in their workplaces and that there are swift and effective penalties when workers experience racism.

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Discrimination: New report highlights persistence of gender discrimination in the workplace

Randstad has published a new report ‘Randstad: Gender equality in the workplace 2022 (September 2022)‘ on gender equality in the workplace. To inform the report, 6000 workers in the construction, education, healthcare and technology sectors were surveyed. The survey sought insight into the status quo of UK workplaces, the persistence of gender discrimination, how employers in these sectors support their employees and what areas workers would like to see their employers focus on in the coming year. Among the findings are statistics which show that:

Inappropriate behaviour or comments from male colleagues had been witnessed or encountered by 72% of women surveyed.
Only 18% of women surveyed had never experienced gender discrimination.
7% of women reported having been passed over for promotion due to perceived gender discrimination.
Just under 10% said they had been offered a less important role because of their gender.
Employers are not doing enough to support female employees during the menopause, according to 73% of the women surveyed.

The report also highlights findings that are specific to each sector. Recommendations are made in three areas; ensuring the recruitment process is inclusive, fostering an inclusive workplace culture and weaving inclusion into the employee lifecycle.

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Pay: Chief executives of FTSE 100 companies see average pay jump of 39%

Research by the High Pay Centre and Trades Union Congress (TUC) shows that the median average pay for CEOs of FTSE 100 companies increased by 39%, from £2.5 million in 2020 to £3.41 million in 2021. During the pandemic, many CEOs took a voluntary pay cut when employees were placed on furlough, but CEO pay has now surpassed the 2019 median of £3.25 million. A similar pay increase was found in the average wages of FTSE 250 CEOs (38%). The average bonus received by CEOs also jumped from £828,000 in 2020 to £1.4 million in 2021.

Previous research by the thinktank suggested that the pay ratios of FTSE 350 companies between CEOs and median employees would increase to new highs after the pandemic. The report shows that CEOs receive 109 times the average pay of British workers, a higher gap than in 2019 when CEOs received 107 times the average pay of British workers.

Frances O’Grady, the general secretary of the TUC, highlighted that the CEO pay jump comes at a time where workers are experiencing “the biggest real wage falls in 20 years.” Workers’ building dissatisfaction at significantly below inflation pay rises in the context of the current cost of living crisis is being increasingly manifested in industrial action. Strikes across multiple industries have already taken place, with further walk-outs due in the coming months.

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ACAS: New guidance on staff suspensions published by ACAS

ACAS has published new guidance to advise employers on how to consider and handle staff suspensions at work, specifically during investigations. The guidance covers deciding whether to suspend someone, the process for suspending someone, supporting an employee’s mental health during suspension and pay and holiday during suspension.

ACAS recommends that because of the risk of breaching the employment contract and the stress that can be caused, a suspension should only be used when it is a reasonable way of dealing with the situation (such as while an investigation is carried out and there is a need to protect evidence, witnesses, the business, other staff or the person being investigated) and there are no appropriate alternatives. Employers should consider each situation carefully before deciding whether to suspend someone.

Suggested alternatives to suspension include:

Changing shifts, site or working from home.
Working with different customers or away from customers.
Stopping working with certain systems, tools or on specific tasks.

A suspension may also be appropriate in order to protect an employee’s health and safety (such as in medical or pregnancy circumstances).

Employers should support a suspended worker by explaining the reason for the suspension, making it clear that it does not mean that it has been decided they have done anything wrong, maintaining pay and benefits, keeping the suspension as short as possible, keeping it confidential wherever possible, and staying in regular contact throughout. The worker should be informed of their suspension in person if possible. It is good practice to allow them to be accompanied at any suspension meeting and for the suspension to be confirmed in writing.

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Employment Law General Update – July 2022

Employment,
27th July 2022

Employment Law

This month’s news covers health at work with the consideration of the introduction of a maximum limit to workplace temperatures and guidance on the new fit notes. We also have an analysis of recent gender pay gap reporting, a report on the low rates of sustainable disability initiatives at FTSE 100 companies, draft regulations for banning exclusivity clauses in contracts and new ACAS guidance about workplace discrimination.

Health at Work: MPs call for maximum limit to workplace temperatures
Health at Work: DWP publishes fit note guidance for healthcare professionals
Gender Pay Gap: New analysis shows more companies reporting an increase in their average gender pay gap
Diversity: Less than 40% of FTSE 100 companies have sustainable disability initiatives
Contracts: Draft regulations laid extending ban on exclusivity clauses in employment contracts to low-income workers
ACAS Advice: ACAS publishes new guidance on asking and answering questions about workplace discrimination

Health at Work: MPs call for maximum limit to workplace temperatures

An early d ay motion (EDM) which calls on the government to introduce legislation to ensure employers maintain reasonable temperatures in the workplace has been signed by 38 MPs. The EDM calls for legislation to enforce a maximum temperature of 30 degrees Celsius, or 27 degrees Celsius for workers doing strenuous work and to require employers to introduce effective control measures, such as installing ventilation or moving staff away from windows and heat sources. The issue of maximum workplace temperatures, which arises from time to time, was previously raised as an EDM in 2013.

The Workplace (Health, Safety and Welfare) Regulations 1992 (SI 1992/3004) requires employers to ensure that temperatures in all workplaces inside buildings are reasonable. While an Approved Code of Practice sets a limit on minimum workplace temperatures of 16 degrees (or 13 degrees if the work involves severe physical effort), there is no limit on the maximum temperature. See what the Health and Safety Executive says about the law here.

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Health at Work: DWP publishes fit note guidance for healthcare professionals

On 1 July 2022, the Department for Work and Pensions (DWP) published Getting the most out of the fit note: guidance for healthcare professionals. The publication follows the expansion of the category of people who can sign fit notes for the purposes of SSP and social security claims and the earlier removal of the requirement for fit notes to be signed in ink. There will be a transitional period during which both the 2017 and 2022 versions of the fit note will be legally valid while relevant IT systems are updated and stocks of paper fit notes in hospitals are replaced.

The guidance has been issued alongside the publication of non-statutory guidance on who can issue fit notes and a training package on e-learning for healthcare. The resources are intended to be used together to support eligible healthcare professionals in ensuring they have the expertise and knowledge to certify and issue fit notes. The guidance reiterates that an assessment is about whether a patient is fit for work in general and not job-specific. It also recognises that incomplete fit notes can make it difficult for employers to support a patient and cause delays to a patient’s return to work.

Information is provided on the factors that should be considered when assessing fitness for work, as well as information on how to discuss a patient’s beliefs about health and work if they are reluctant to return to work. In addition, there is information on how the free text section of the note should be completed, including the importance of giving practical advice to employers. In this section, it is noted that the only reference to a patient’s current job should be in the context of possible workplace adaptations or if the job may be affecting their health. Towards the end of the guidance, there are several case studies and an FAQ section. The FAQ section highlights that a medical professional’s advice is not binding on an employer, and it is for an employer to determine whether to accept the advice.

The guidance for employers and line managers and employees has also been updated to reflect the expanded category of people who can sign fit notes.

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Gender Pay Gap: New analysis shows more companies reporting an increase in their average gender pay gap

PwC analysis of gender pay gap data has found that of the companies that disclosed their data this year 43% reported an increase in their average gender pay gap (up from 41% the year before). A decrease was reported by 53% of companies and no change was reported by the remaining 4%. 1,826 more companies reported their gender pay gap details this year.

The analysis shows that only small changes, of no more than plus or minus 5%, have been made to most companies’ pay gaps. This suggests that “significant change may take a long time” as organisations “continue to struggle with making impactful changes to the gap“.

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Diversity: Less than 40% of FTSE 100 companies have sustainable disability initiatives

A recent study by Agility in Mind has found that only 37% of FTSE 100 companies have sustainable disability initiatives in place and just 4% have neurodiversity initiatives. This is despite 99% of FTSE 100 companies having inclusive mission statements. Of the 250 business leaders who were polled as part of the research, 16% described their neurodiversity initiatives as “highly effective” compared to 26% of those who described their race or gender equality initiatives in the same way.

Separately, a TUC-commissioned survey of approximately 1,000 HR managers across different workplaces has found that 21% of workplaces do not have specific support policies for LGBT staff and only 25% have a policy setting out support for trans and non-binary staff.

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Contracts: Draft regulations laid extending ban on exclusivity clauses in employment contracts to low-income workers

Draft regulations have been laid before Parliament which will prohibit exclusivity clauses in the employment contracts of workers whose earnings are on, or less than, the lower earnings limit (currently £123 a week). The draft regulations follow a government consultation on extending to other low earners the ban on exclusivity clauses which was introduced in 2015 to zero-hours workers’ contracts.

The draft regulations largely mirror the rights of zero-hours workers set out in section 27A of the Employment Rights Act 1996 and the Exclusivity Terms in Zero Hours Contracts (Redress) Regulations (SI 2015/2021). They will make unenforceable any contractual term which prohibits a worker from doing work or performing services under another contract or arrangement, or which prohibits a worker from doing so without their employer’s consent. Where they breach an exclusivity clause in their contract, employees will be protected from unfair dismissal and workers will be protected from detriment. The new unfair dismissal protection will have no qualifying period. Where an employment tribunal finds that a worker has suffered a detriment, it may make a declaration and award compensation it considers just and equitable up to an amount equal to the unfair dismissal basic and compensatory award.

The draft regulations will come into force 28 days after the day on which they are made and apply to England, Scotland and Wales.

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ACAS Advice: ACAS publishes new guidance on asking and answering questions about workplace discrimination

Following the repeal of the statutory questionnaire procedure in 2014, ACAS published non-statutory guidance, Asking and responding to questions of discrimination in the workplace to assist employees and employers in asking and responding to discrimination questions. That guidance was subsequently withdrawn.

ACAS has now published new information on its website on asking and answering questions about discrimination at work. The guidance sets out suggested steps for an employee who believes that they may have been discriminated against in the workplace, guidance on the information they should provide in writing to their employer and the types of questions they could ask their employer in order to help establish whether discrimination has taken place. The guidance also explains how employers should consider and respond to employees’ questions concerning workplace discrimination, and what might or might not amount to unlawful discrimination. An example statement and questions concerning potential discrimination to an employer and an example employer’s response are also provided.

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Employment Law Case Update – June 2022

Employment,
28th June 2022

Employment Law

A round-up of the most significant employment law cases to be published over the last month including insights on dismissal cases, using without prejudice letters and when injunctive relief may be sought to enforce a non-compete clause. We also have an interesting case on ethical veganism v legality of actions.

Equality Act: Ethical veganism encompassing an obligation to break the law to relieve animal suffering was not a protected belief
Unfair Dismissal: Statutory cap should be applied to unfair dismissal compensation after deduction of earlier payments made to employee
Constructive Dismissal: Fundamental breach possible even where employer’s actions do not suggest intention to end employment relationship
Dismissal: ACAS code applied to discriminatory sham redundancy dismissal
Injunctive Relief: Interim enforcement of non-compete clauses
Without Prejudice: Without prejudice letter inadmissible despite exaggerated allegations

Equality Act: Ethical veganism encompassing an obligation to break the law to relieve animal suffering was not a protected belief

In Free Miles v The Royal Veterinary College ET/2206733/2020, an employment tribunal has found that a belief in ethical veganism encompassing an obligation to break the law to relieve animal suffering did not amount to a philosophical belief under section 10 of the Equality Act 2010 (EqA 2010).

Ms Free Miles was a veterinary nurse employed by the Royal Veterinary College (RVC). In February 2019, she was arrested by police in connection with alleged burglaries by the Animal Liberation Front. The police found a sick turkey at her flat which she said she had rescued. Following her arrest, Ms Free Miles was summarily dismissed by RVC for reasons including that RVC believed she was connected with an animal rights group that endorsed law breaking and that she had participated in activities including trespass and theft.

Ms Free Miles brought an employment tribunal claim against RVC for, among other things, direct and indirect philosophical belief discrimination. She relied on her belief in ethical veganism, arguing that this belief included a moral obligation to take positive action to reduce animal suffering, including trespass on property and removal of animals. By the time of the tribunal hearing, Ms Free Miles had been charged by the police with criminal offences relating to animal rights activities.

The tribunal stated that, had Ms Free Miles’ belief in ethical veganism been limited to the belief that humans should not eat, wear, use for sport, experiment on or profit from animals, it would have had no reservation in concluding that it amounted to a philosophical belief under section 10 of the EqA 2010. It also said that it might have reached the same conclusion had the moral obligation to take positive action to reduce or prevent animal suffering been limited to lawful action.

However, Ms Free Miles’ belief included trespassing on private property and acting in contravention of the law. The tribunal concluded that a belief to take actions that are unlawful and to interfere with the property rights of others could not be worthy of respect in a democratic society, so did not satisfy the fifth element of the test in Grainger Plc v Nicholson [2010] 2 All ER 253. Laws were made by democratically elected representatives and had to be obeyed by all citizens. It was not open to individuals to decide which laws to obey and disobey. Ms Free Miles’ discrimination claims therefore failed.

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Unfair Dismissal: Statutory cap should be applied to unfair dismissal compensation after deduction of earlier payments made to employee

In Dafiaghor-Olomu v Community Integrated Care [2022] EAT 84, the EAT has held that any payments made by an employer to an employee in respect of an unfair dismissal claim must be deducted from the total compensation sum before the statutory cap is applied.

Mrs Dafiaghor-Olomu won an unfair dismissal claim against Community Integrated Care (CIC). She sought re-engagement and compensation. The tribunal refused re-engagement but awarded £46,153.55 in compensation which CIC paid in full. At a second remedies hearing following a successful appeal, the tribunal increased the compensatory award to £128,961.59. The EAT was required to determine whether the statutory cap should be applied after the earlier payment made by CIC was deducted from the sum of £128,961.59 (leaving an outstanding payment of £74,200, being the amount of the statutory cap in place at the relevant time) or whether the statutory cap should be applied to the total award before the earlier payment was deducted (leaving an outstanding payment of £28,046.45). CIC argued for the latter approach, stating that the former would mean it got no credit for the earlier payment and would be penalised for complying with the tribunal’s original order.

The EAT considered the wording of section 124(5) of the Employment Rights Act 1996. It felt that this showed that Parliament’s intention was for the tribunal to calculate the total compensation due to the employee and then subtract from it any earlier payments made by the employer before applying the cap. However, in reaching this conclusion, the EAT expressed considerable sympathy with CIC. In paying the original compensatory award, CIC had complied with what it perceived to be its duty. Had it foreseen the possibility that the tribunal would increase the award at the second remedies hearing, it would probably have declined to make any payment until the compensatory order was final. Instead, it ended up owing £74,200 plus £46,153.55 instead of just £74,200.

Additionally, the EAT upheld the employment tribunal’s decision not to reconsider its refusal to award re-engagement after the second remedies hearing on the basis that such an order was impracticable because of Mrs Dafiaghor-Olomu’s attitude towards which jobs were suitable for her. It also dismissed a cross appeal in which CIC argued that the employment tribunal had not been entitled to increase the compensatory award at the second remedies hearing.

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Constructive Dismissal: Fundamental breach possible even where employer’s actions do not suggest intention to end employment relationship

In Singh v Metroline West Ltd [2022] EAT 80 the EAT has held that, in a constructive dismissal claim, a fundamental breach of contract can be established even where the employer’s actions do not indicate an intention to end the employment relationship.

Mr Singh was invited to a disciplinary hearing by Metroline West Ltd. The next day, Mr Singh was signed off sick by his doctor. While absent, he was examined by occupational health who did not suggest his sickness was not genuine. However, Metroline believed that Mr Singh was trying to avoid the disciplinary hearing. It therefore paid him statutory sick pay only, instead of company sick pay. Mr Singh brought a claim for constructive dismissal, alleging, among other things, that the failure to pay him company sick pay was a fundamental breach of contract.

The employment tribunal found that Metroline had contractual power to suspend Mr Singh without pay if it thought his absence was not genuine, but this power had not been exercised. Separately, Mr Singh’s contract allowed company sick pay to be withheld where, after investigation, absence was found not to be genuine. There was no investigation in this case and no other relevant contractual grounds on which company sick pay could be withheld. There was therefore a breach of contract. However, the tribunal found the breach was not fundamental. By withholding pay, Metroline had not indicated an intention not to be bound by the employment relationship; rather, its aim in withholding pay was to encourage Mr Singh’s participation in a disciplinary process integral to that relationship.

However, the EAT upheld Mr Singh’s appeal on this issue. It was an error of law for the tribunal to adopt the approach that, for the breach of contract to be fundamental, there must have been an intention by the employer not to be bound by the contract in a manner that meant that it no longer wished to continue with the employment relationship. What is required is that the employer demonstrates an intention to no longer comply with the terms of the contract that is so serious that it goes to the root of the contract. In this case, there was a deliberate decision to withhold pay to which Mr Singh was entitled, resulting in a significant reduction in earnings, in circumstances where there were other contractual provisions which would have allowed Metroline to deal with suspicions about his absence. This was a fundamental breach.

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Dismissal: ACAS code applied to discriminatory sham redundancy dismissal

In Rentplus UK Ltd v Coulson [2022] EAT 81 the EAT has held that the ACAS Code of Practice on Disciplinary and Grievance Procedures (ACAS Code) applied to a discriminatory dismissal purportedly by reason of redundancy. The tribunal had not erred in awarding the maximum 25% uplift available for failure to follow the ACAS Code.

The employer’s ground of appeal that the ACAS Code could not apply where their reason for dismissal was redundancy and the reason found by the tribunal was sex discrimination failed. This was because the tribunal had rejected redundancy as the reason for the dismissal and the upholding of the sex discrimination claim did not mean that it was the only reason for the dismissal. The EAT considered it was implicit in the tribunal’s reasoning that the claimant was in a “disciplinary situation” to which the ACAS Code applied, this being that she was dismissed due to dissatisfaction with her personally and/or her performance, which was tainted by sex discrimination, and a fair capability or disciplinary procedure should therefore have applied.

It was clear that the tribunal had concluded the dismissal process was a sham and there had been a total failure to comply with the ACAS Code. The breach was referred to as “egregious” and so was beyond unreasonable. While, generally, a tribunal should identify the employer’s failings for which an uplift is being made by reference to the relevant part of the ACAS Code which the employer is said to be in breach of, in this case the tribunal had concluded that the employer had acted in bad faith such that there was a total failure to apply any of the protections provided for by the ACAS Code. In these circumstances, there was no error of law in the award of an uplift of 25%.

The EAT provided guidance in the form of questions that tribunals considering an ACAS uplift should apply:

Is the claim one which raises a matter to which the ACAS Code applies?
Has there been a failure to comply with the ACAS Code in relation to that matter?
Was the failure to comply with the ACAS Code unreasonable?
Is it just and equitable to award an uplift because of the failure to comply with the ACAS Code and, if so, by what percentage, up to 25%?

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Injunctive Relief: Interim enforcement of non-compete clauses

In Planon Ltd v Gilligan [2022] EWCA Civ 642 the Court of Appeal has dismissed an appeal from the High Court’s refusal to grant an interim injunction to enforce a non-compete clause.

The High Court had held that the delay between the initial exchanges of correspondence between the parties and the application being heard was not the sort of delay that would disqualify the employer from interim injunctive relief. However, the employer’s prospects of success at trial in enforcing the non-compete clause were not that good, the critical point being the non-compete clause was likely to prevent the employee from being able to work in his field for 12 months. Damages would not, or might not, be an adequate remedy for either the employer or employee in this case.

While the Court of Appeal dismissed the employer’s appeal, its reasoning differed from that of the High Court. It held that the High Court had not taken the correct approach when considering whether the non-compete clause was reasonable. However, in view of the delay by the time the matter came before it, the court did not consider it appropriate to express a preliminary view about the enforceability of the clause.

The court considered the effect of delay in the case. There was a divergence of opinion between Elisabeth Laing LJ and Bean LJ, with Nugee LJ expressing no view, on the effect of the delay between the facts becoming known to the employer and the High Court hearing. Elisabeth Laing LJ considered that the judge had reached a decision open to him on the facts while Bean LJ considered that the judge would have been entitled to refuse an injunction on the ground of delay. The court noted that there was no rule of law to the effect that damages would be an adequate remedy for the employee (if it was found that at trial that a restrictive covenant is unenforceable). Bean LJ suggested that, except in cases of very wealthy defendants, or where a claimant employer is offering paid garden leave for the whole period of the restraint, it was unrealistic to argue that damages would be an adequate remedy.

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Without Prejudice: Without prejudice letter inadmissible despite exaggerated allegations

In Swiss Re Corporate Solutions Ltd v Sommer [2022] EAT 78 the EAT has held that an employment judge erred when holding that a without prejudice letter could be admitted into evidence under the “unambiguous impropriety” exception to the without prejudice rule in proceedings brought by an employee against her former employer. The without prejudice rule prevents statements made (whether in writing or orally) in a genuine attempt to settle an existing dispute from being put before the court as evidence of admissions against the interest of the party that made them.

The letter referred to the employee’s actions in having copied three emails to her personal email address when sending them to her employer in pursuit of a grievance. The emails had contained personal data and matters confidential to the employer and its clients. Before offering to settle her complaints by way of termination of her employment and payment of compensation, the letter alleged that the employee’s actions breached the confidentiality obligations in her employment contract, were a criminal offence under the Data Protection Act 2018 and meant that she had acted, or might have acted, without integrity in breach of Financial Conduct Authority (FCA) rules. This could result in summary dismissal, criminal convictions, fines and FCA findings which could make it difficult for her to work again in the regulated sector.

In holding that the unambiguous impropriety exception applied, the employment judge found that there had been no basis at all for the employer’s assertion that the employee’s actions amounted to serious misconduct and that the severity of what she had done had been grossly exaggerated in order to put pressure on her to accept the termination of her employment.

The EAT held that the employment judge had erred in finding there was no basis at all for the allegations of serious misconduct. It considered that the high threshold for unambiguous impropriety could be met in circumstances in which a party made exaggerated allegations although it was unaware of any decided case on this point. However, exaggeration would not usually pass the threshold without findings as to the guilty party’s state of mind. The employment judge did not make such findings, and the EAT doubted that this could have validly been done at a preliminary hearing without oral evidence. The only possible outcome in this case was that the without prejudice letter was inadmissible in evidence.

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Legislation: Government publishes Employment Rights Bill

Protection at work: The Worker Protection (Amendment of Equality Act 2010) Act 2023 to comes into force on 26 October 2024 and EHRC updates its harassment guidance and publishes eight-step guide for employers on preventing sexual harassment at work

Parents: New private members’ bill on Still-Birth and leave for Neo-natal care

Pay: New Tipping Act and supplementary Code of Practice comes into force – guidance available

Equality: Office for Equality and Opportunity replaces the Equality Hub

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Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised

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Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans

Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025

Rights at Work: Parliament introduces bill to define bullying at work

Disability: DWP launches consultation on proposals for Disability Action Plan

Ethnicity Pay Reporting: Government publishes response to ethnicity pay reporting consultation

ACAS: New consultation published on new draft Code of Practice on flexible work requests

ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

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Brexit: Government scraps the proposed sunset clause from the Retained EU Law Bill and Minister confirms effect of the Bill on equality and employment rights

Employment rights

Parental leave

Employment Law: Government’s “Smart regulation unveiled to cut red tape and grow the economy”

Flexible Working: House of Commons Committee report on post-pandemic economic growth in UK labour markets

Health at Work: ACAS publishes new guidance on managing stress at work and making reasonable adjustments for mental health at work

Managing stress at work:

Making reasonable adjustments for mental health at work:

Disability: HSE launches podcast to support disabled people in the workplace

Diversity: EBA publishes consultation on guidance on benchmarking of diversity practices

Sex Discrimination: Research reveals unfair treatment at work after fertility treatment

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Gender Pay Gap: ONS 2022 gender pay gap data published

Race Discrimination: 2021 survey considers perceptions and experiences of racism at work

ACAS: Survey finds 1 in 3 employers feel under-equipped to support women during menopause

Trade Unions: New Transport Strikes Bill introduced to House of Commons

Technology: Research suggests using AI to reduce bias in recruitment is counter-productive

Leave: Government backs Carer’s Leave Bill

Redundancy: Government backs Protection from Redundancy (Pregnancy and Family Leave) Bill

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Brexit: Retained EU Law (Revocation and Reform) Bill 2022-23 introduced to House of Commons

IR35: Off-Payroll Rules to be repealed by 6 April 2023

Human Rights: Bill of Rights Bill 2022-23 dropped by government

Equality: New TUC report highlights prevalence of racism at work

Discrimination: New report highlights persistence of gender discrimination in the workplace

Pay: Chief executives of FTSE 100 companies see average pay jump of 39%

ACAS: New guidance on staff suspensions published by ACAS

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Health at Work: MPs call for maximum limit to workplace temperatures

Health at Work: DWP publishes fit note guidance for healthcare professionals

Gender Pay Gap: New analysis shows more companies reporting an increase in their average gender pay gap

Diversity: Less than 40% of FTSE 100 companies have sustainable disability initiatives

Contracts: Draft regulations laid extending ban on exclusivity clauses in employment contracts to low-income workers

ACAS Advice: ACAS publishes new guidance on asking and answering questions about workplace discrimination

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Equality Act: Ethical veganism encompassing an obligation to break the law to relieve animal suffering was not a protected belief

Unfair Dismissal: Statutory cap should be applied to unfair dismissal compensation after deduction of earlier payments made to employee

Constructive Dismissal: Fundamental breach possible even where employer’s actions do not suggest intention to end employment relationship

Dismissal: ACAS code applied to discriminatory sham redundancy dismissal

Injunctive Relief: Interim enforcement of non-compete clauses

Without Prejudice: Without prejudice letter inadmissible despite exaggerated allegations

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