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Employment Law General Update – February 2023

Employment Law

We bring you a month of reports and inquiries. Two reports from a think tank and the IES into how women’s finances are affected by their working life and what impact this can have on the gender pension gap. A new Bill has been given government backing to give zero hours workers more certainty by requesting a more predictable work pattern. A troubling and impactful inquiry has been published into the TSSA, with stark consequences, and a study finds that despite having whistleblowing policies in place, many require better implementation and training.

  • Pensions: Think tank publishes two reports on the gender pension gap with recommendations
  • Zero Hours Contracts: Government backs law to give workers right to request more predictable work pattern
  • Trade Unions: Inquiry finds Sexual harassment rife at TSSA
  • Whistleblowing: Majority of firms have whistleblowing policies, but lack formal training for those handling concerns, study finds

Pensions: Think tank publishes two reports on the gender pension gap with recommendations

Two reports from think tank Phoenix Insights and the Institute for Employment Studies (IES) exploring women’s finances through the lens of the workplace, set out a number of recommendations to assist women’s ability to save thereby closing the gender pension gap. The gender pay gap already disadvantages women’s future finances because it means they are more likely to contribute less to their retirement savings than their male peers. The research found that this disparity is made worse by life events, including motherhood, menopause, divorce, childcare, menstruation and caring responsibilities which can all disproportionately affect a woman’s earnings, and therefore pension contributions.

Some of the key findings in the reports include that the gender pay gap is a significant contributor to the gender pension gap, yet women on average contribute a larger proportion of their salary to their pension. On average, women are contributing a higher percentage of their monthly income into their pension than men up until middle age – 6.1% compared to 5.8% aged 35-44 by middle age – where care responsibilities fall to one in four women in the UK – men are paying almost £80 more per month into their pension than women. Women are more likely than men to fall under the auto-enrolment threshold (women 35% : men 11%). Automatic enrolment closed the contribution gap in participation but increased the gap in terms of contribution. Women are more likely to be economically inactive due to long-term health conditions than men. There is limited awareness among employers of the causes and consequences of the gender pension gap, resulting in a lack of action over and above the statutory minimum allowances that seek to improve the savings capacity of women across the different life stages.

The think tank report recommends employers should be required to inform employees about the pensions impact that changes to their working hours and earnings may have, to help close the gender pension gap.

The opportunity for employers – five key recommendations:

  • re-enrol workers into pension schemes annually, rather than the statutory three years, to give workers the opportunity to re-engage if they have taken career breaks or have opted out because of a lack of affordability
  • ensure employer pension contributions continue during periods of parental leave
  • adopt a minimum of five days unpaid leave per year for those with childcare responsibilities, and where possible, five days paid carer’s leave
  • make flexible working the norm from day one and highlight this across all job roles
  • ensure workplace health policies offer explicit and visible support for reproductive conditions such as miscarriage, fertility treatment, for those diagnosed with endometriosis and managing menopause symptoms

The role of government – five key recommendations:

  • legally require employers to provide information on how contractual changes impact pension contributions
  • revisit the Carer’s Leave Bill to ensure that unpaid careers can access up to ten days statutory paid leave
  • the legal right to flexible working should be available from the first day of employment, and the number of reasons to reject flexibility should reduce from eight to two
  • widen the coverage of auto-enrolment by lowering age and earnings eligibility threshold to 18 years and £0, respectively
  • review the advice and guidance boundary so that a larger population can access tailored and reliable financial support

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Zero Hours Contracts: Government backs law to give workers right to request more predictable work pattern

The Department for Business, Energy & Industrial Strategy (BEIS) has announced that the government is backing Blackpool South MP Scott Benton’s Workers (Predictable Terms and Conditions) Bill. The Bill seeks to ensure that all employees, even agency workers, receive more predictable working patterns.

‘Hard working staff on zero hours contracts across the country put their lives on hold to make themselves readily available for shifts that may never actually come’ said Labour Markets Minister, Kevin Hollinrake. ‘Employers having one-sided flexibility over their staff is unfair and unreasonable. This Bill will ensure workers can request more predictable working patterns where they want them, so they can get on with their daily lives.’ The Bill provides that if an employee’s existing working pattern lacks certainty in terms of the hours they work, the times they work, or if it is a fixed term contract for less than 12 months, they may make a formal application to change their working pattern to make it more predictable. The move comes as part of a package of policies designed to further workers’ rights, such as:

  • paid neonatal care leave
  • requiring employers to ensure that all tips, gratuities, and service charges are paid to workers in full
  • entitling unpaid carers to a period of unpaid leave
  • providing employees with a day one right to request flexible working, and a greater say over when, where, and how they work

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Trade Unions: Inquiry finds sexual harassment rife at TSSA

A misogynistic, ‘mafia-like’ culture of sexual harassment, bullying and violent language has permeated one of Britain’s transport unions, a new independent inquiry has revealed. An investigation by Baroness Helena Kennedy KC into the Transport Salaried Staffs’ Association (TSSA) concluded on 8 February 2023 that ‘there has been sexual harassment, discrimination and bullying within the TSSA and that the leadership and culture has enabled these behaviours through wilful blindness, power hoarding and poor practices’.

Kennedy’s report called for sweeping changes in an organisation where absolute power was concentrated in ‘a very small number of hands’, and called for new leadership at the TSSA. The TSSA opened the investigation in September 2022 after its General Secretary at the time, Manuel Cortes, was accused of sexual harassment by several women. Cortes, who has since retired with an undisclosed payout, denies the allegations. Kennedy pointed out in her report that neither the internal leadership of the TSSA nor the executive committee understood that to say they had not witnessed inappropriate behaviour is not an acceptable response to an ‘atmosphere of fear’ and an environment of ‘open secrets’.

Only two of the 50 people who volunteered to speak to Kennedy as she carried out her inquiry had any positive words to say about the TSSA’s culture, according to her report. The rest described a ‘dysfunctional’ and ‘mafia-like’ culture across the TSSA. The organisation was sexist, racist and homophobic, they said.

Kennedy said that a ‘distressing element’ of her inquiry was realising how little senior leaders at the TSSA seemed to have ‘moved with the times’. Their approach to management was ‘controlling’ and described by many staff members as bullying. The barrister said that, combined with governance failings, meant the ‘outdated attitudes of scepticism and disbelief of women’ formed a ‘dangerous mixture’.

Kennedy noted that the recent history of ‘wage suppression’, particularly in the public sector, and the ‘casual erosion of employment rights’ through precarious work points to an urgent need for healthy trade unions. She recommended a sweeping change of leadership, a realistic time-frame for reform and ‘serious investment of time in culture change’ to make a success of the TSSA.

TSSA said in response that the report made ‘difficult reading’ and highlighted serious problems that the union had to tackle. A spokesperson said the TSSA recognised the need for sweeping reform and stated its commitment to tackle institutional issues and drive through a culture change. ‘As a union, TSSA fights for equality, fairness and social justice for all, regularly winning on equality issues for our members’, the spokesperson said. ‘But it is clear from this report that our union has not followed the values we aspire to for our members.’

The President and Treasurer of the TSSA have stood down with immediate effect and interim replacements had been appointed, the spokesperson added. The TSSA has confirmed it is committed to take comprehensive, considered and meaningful action to address [the report’s] findings, and to enable the necessary further investigation and decisions to be made, the TSSA has suspended all five senior members of staff named in the report, including former General Secretary, Manuel Cortes.

Responding to the report, the TUC stated that ‘sexual harassment and bullying have no place in the trade union movement or any workplace. The TUC believes the women who came forward to share their experiences’. The TSSA have been asked to meet with the TUC General Secretary and the TUC President to discuss next steps.

The Kennedy report comes after a similar 2020 investigation into the GMB, conducted by Karon Monaghan KC, concluded that the GMB is institutionally sexist, and bullying, misogyny, cronyism and sexual harassment are endemic within the GMB.

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Whistleblowing: Majority of firms have whistleblowing policies, but lack formal training for those handling concerns, study finds

On 16 February 2023, an article by People Management reported that a study by whistleblowing and compliance services provider Safecall, which surveyed HR managers and directors from 222 organisations, found that that while 17 per cent of respondent organisations lacked a whistleblowing policy, the majority (83 per cent) did have one in place, and for those companies that provide internal whistleblowing services, only 58 per cent of their investigators had been formally trained.

The report also discovered:

  • more than two fifths (42 per cent) of employees responsible for managing whistleblowing complaints have either self-taught, learned their skills through experience, or have no experience at all
  • more than half (57 per cent) of HR professionals surveyed believed that their employees were actively encouraged to report wrongdoing.
  • however, just 42.6 per cent said employees “generally feel safe” to do so, 
  • the majority (74 per cent) of HR professionals could not be certain that whistleblowers were confident in raising concerns, and
  • one in five (20 per cent) organisations have whistleblowing processes that their employees would find to be “highly untrustworthy”.

The article goes on to discuss various aspects of having whistleblowing policies. A policy that emphasises how employees can bring matters to their employer’s attention, which may help employers avoid or at least reduce the risk of employment claims by increasing the likelihood that disclosures will be readily identified as qualifying as a protected disclosures.

However, problems arise where there is a fundamental lack of trust between an organisation and its workforce. Having a whistleblowing policy that ensures there is a clear procedure that must be followed by all staff when a complaint is made can support businesses in fostering a transparent and open company culture. The policy should also demonstrate that staff should not be victimised or subjected to any detrimental treatment as a result of bringing a complaint.

Last year, legal experts warned HR professionals of the consequences of workers whistleblowing on their former and current employers for coronavirus job retention schemes, with law firm Pinsent Masons reporting that 13,775 furlough fraud whistleblowing reports were made to HMRC.

Meanwhile, a previous People Management report found that one in five (20 per cent) employees who had gone to their bosses with concerns over furlough fraud and breaches of Covid-19 safety rules were sacked as result. 

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Further Information:

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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.

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