Member Article

Employment Law alert; whistleblowing, employee shareholders, caste discrimination

Breaking news:-

• A much promoted piece of legislation has reached the statute book
• A new employment category is introduced
• A protected characteristic takes on new features and …
• This years new National Minimum Wage increases are published

1. Enterprise and Regulatory Reform Act

This key piece of employment legislation recently became law. Not all of the measures contained in the Act are being introduced this year but those that are include:-

• simplified rules for Employment Tribunals in deciding cases
• an amendment closing the loophole in the whistleblowing provisions. Only those disclosures that are made in the public interest are protected. This is to prevent claimants arguing that a breach of their own contracts should be covered.
• a provision ensuring dismissal for political opinions or affiliation to a political party will not require the two year qualifying period in order to be protected.

These measures will come in to force on 25th June. Other provisions in the Act, inluding; compulsory Pre-claim Acas Conciliation and fines of between £100 and £5,000 for employers found by an Employment Tribunal to have breached employees’ rights in cases where there are “aggravating features”, will come in to force this Autumn or Spring next year.

2. Employee shareholders

The Governments’ plans for the new employment status. {the existing ones are ‘employee’ and ‘worker’} are set to become law after a bumpy ride through Parliament. Following resistance from the House of Lords, a number of amendments have been added to the related clauses in the Growth and Infrastructure Bill. They include:-

• employee shareholders being given a ‘written statement of particulars’ on their status and rights associated with the shares which they are being given. Including; voting rights, transferability of the shares, rights to dividends, and so forth.
• a compulsory seven day ‘cooling off’ period between the employee shareholder accepting the role and being able to take it up;
• existing workers not suffering a detriment if they refuse to switch to employee shareholder status;
• guidance to Job Centre staff to be amended so that Jobseekers cannot be compelled to accept an employee shareholder job, or have their Jobseekers Allowance affected if they refuse to apply for such a job.

And … just before the final whistle; a further clause was introduced, requiring applicants to receive independent legal advice, paid for by the employer, before being allowed to take up an employee shareholder role.

The new scheme is due to be introduced this September. In return for receiving a minimum £2,000 worth of company shares, tax free up to this amount, employee shareholders will give up their rights to claim unfair dismissal and statutory redundancy payments and to request flexible working and time off for training. Other rights - such as protection from discrimination and automatic unfair dismissal, are unaffected.

3. Collective redundancies

Acas has published new guidance on managing collective redundancies, following the reduction in the minimum consultation period for 100 or more redundancies from 90 to 45 days, which came into effect on 6th April. There are transitional arrangements for redundancies proposed before that date. A collective redundancy arises when an employer plans to make 20 or more employees redundant in a 90 day period.

The new Acas guide has a 10 point checklist which deals with, amongst other items; the meaning of an ‘establishment’ an issue which has continually come up in case law because it is the number of employees an employer proposes to make redundant ‘at one establishment’ that triggers the requirement to consult. The guide points out that that an establishment can mean more than one place, and be somewhere that the employees ‘do not habitually work’. It suggests questions to ask when attempting to decide whether a particular work entity is an establishment but warns employers to seek professional advice if in any doubt.

The guide also mentions ‘fixed-term contracts’. Since 6th April, employers must include fixed-term contracts when counting the number of redundancies to determine whether or not consultation rules are applicable if they are proposing to terminate the contract early on the grounds of redundancy. Contracts terminating on a date already agreed are not included in the calculation.

4. National Minimum wage

The Government has announced new rates in its response to the Low Pay Commission’s report on the National Minimum Wage, With effect from 1st October 2013:-

• the adult rate will increase 12p to £6.31 per hour
• the rate for 18-20 year olds will increase by 5p per hour to £5.03 per hour
• the rate for 16-17 year olds will increase by 4p to £3.72 per hour
• the apprentice rate will increase by 3p to £2.68 per hour
• the accommodation offset will increase from the current £4.82 to £4.91

The Low Pay Commission had recommended freezing the apprentice rate because of lack of compliance among employers. However, Business Secretary, Vince Cable said that instead of doing this the Government would raise the rate in line with the others in order to “continue to make them attractive to young people” and would “be working on tough new measures to ensure we tackle non-compliance issues across the board”.

5. Caste discrimination

The Government has decided to bow to pressure during debates on the “Enterprise and Regulatory Reform Bill’ {now an Act} and make ‘Caste Discrimination’ an aspect of race under the Equality Act 2010. The Equality and Human Rights Commission is to provide “expert analysis” later this year on what it describes as “an extremely complex area”.

Keep checking my articles for more Employment Law Alerts.

This was posted in Bdaily's Members' News section by Andrew Dane .