Some Employement Law Changes To Note For 2012

Posted on January 2, 2012 by bill

Every year brings with it some important new employment legislation for the employer to negotiate. Whether related to unfair dismissal, pensions, employment tribunals or redundancy, 2012 presents new legislation relevant to all organisations, large or small. Read our guide to the six key updates to make sure you are ready for the year ahead.

1. Qualifying period for unfair dismissal protection is increased

The biggest change to employment rights for 2012 is the increase of the qualifying period for an employee to bring an unfair dismissal claim from one year to two years. This change comes into force on 6 April 2012. The Government has said that it intends to increase the qualifying period for unfair dismissal to “provide more time for employers and employees to resolve difficulties, give employers greater confidence in taking on people and ease the burden on the employment tribunal process”.

2. Pensions auto-enrolment begins

In what may prove to be one of the biggest challenges of the year for larger employers, starting from 1 October 2012, employers with 50 or more employees have to enrol eligible employees automatically, and make mandatory employer contributions, into a qualifying workplace pension scheme or the National Employment Savings Trust (Nest).

3. Changes to employment tribunal procedure

The Government has announced a “fundamental review” of the Employment Tribunal Rules of Procedure, with substantial changes to employment tribunal procedure expected to be introduced on 6 April 2012. Employment judges will hear unfair dismissal cases alone in the tribunal, unless they direct otherwise. The maximum amount of a deposit order, which a tribunal can order a party to pay as a condition to continuing with tribunal proceedings, will increase from £500 to £1,000. The maximum amount of a costs order, which a tribunal may award in favour of a legally represented party, will increase from £10,000 to £20,000. Witness statements are to be taken “as read” unless a tribunal directs otherwise.

4. Statutory redundancy payments and guarantee payments increase

The maximum amount of a week’s pay used to calculate a statutory redundancy payment and the basic and additional awards for unfair dismissal increases from £400 to £430 on 1 February 2012. The maximum unfair dismissal compensatory award increases from £68,400 to £72,300. The limit on the amount of a guarantee payment payable to an employee in respect of any day also increases from £22.20 to £23.50.

5. Maternity, paternity, adoption and sick pay increase

The Government has confirmed that the standard rate of statutory maternity, paternity and adoption pay will increase from £128.73 to £135.45 per week from 1 April 2012. Statutory sick pay will increase from £81.60 to £85.85 per week from 6 April 2012.

6. Watch this space…

There are a number of other employment law developments that are in the pipeline, but for which no date has been set. For example, there are proposals for the introduction of employment tribunal fees and plans for the introduction of “protected conversations”, and there have been calls for evidence over whether or not the law on TUPE and collective redundancy consultation should be amended to reduce the burden on businesses. The Government has also announced that it will consult on reforming the law on employment disputes and removing the third-party harassment provisions of the Equality Act 2010.

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Self Assessment – How Much Money To Set Aside

Posted on December 26, 2011 by bill

When you start self-employment, you do not get your first tax bill for a while, so you need to think about how much money to set aside now.

The table below can help you to do this. It shows you how much money you might need to set aside to meet your tax and Class 4 National Insurance contributions (NICs) bill. It doesn’t include Class 2 National Insurance contributions which you will need to pay separately – this is around £2.50 a week for 2011–12.

The information below uses estimated weekly/monthly profit figures and is based on a self employed individual, who has no other income which should be taxed and is entitled to a basic Personal Allowance. Profit is your income less expenses.

The exact amount of tax and/or Class 4 National Insurance contributions due and payable can only be worked out once you have completed your Self Assessment tax return.

The table below will help you work out the approximate Income Tax/Class 4 NICs to set aside each week/month.

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How Will Adverse Weather Affect Your Business?

Posted on December 19, 2011 by bill

Bad weather such as heavy snow can cause major operational difficulties for small businesses as well as issues in the workplace including: staff turning up to work late or not at all due to travel disruptions; matters relating to the closure of the business; and health and safety concerns.

MBB Business Services provides you with an overview of your obligations and arms you with the answers to some of the trickier questions – to help keep you out of the tribunals!

Do I have to pay employees who turn up to work late or do not turn up at all due to severe weather conditions or disruptions to public transport?

There is no obligation to pay employees who fail to attend work or who arrive late due to bad weather or disruptions to public transport for the missed time, unless there is specific provision for such absence to be paid in the contract of employment. The burden is on the employees to get to work and the obligation to pay under the contract of employment arises only where they are ready, willing and available for work. If employees fail to turn up for work or turn up late in these circumstances, you are under no obligation to pay them for time not worked, even though their absence or lateness was through no fault of their own. A failure to pay an employee in this situation is not an unlawful deduction of wages under the Employment Rights Act 1996 because there is no contractual right to any such payment.

However, if employees are having problems getting to work due to bad weather or public transport disruptions, you may wish to consider making some accommodation for them. You should first encourage the employees to explore alternative means of transport, for example other public transport options, walking, cycling, travel by car or car-sharing with other employees.

If my business allows it, should I let employees work from home?

If an employee is still unable to attend work, you may wish to give consideration to whether or not the employee could usefully work from home or from an alternative local office until the travel situation improves, or whether or not the time could be made up at a later date. If these are not viable options, the alternatives available for you are to advise the employee that any time off work in these circumstances will be unpaid, paid or paid on a discretionary basis but in exceptional cases only. You could also suggest that the employee take paid annual leave if he or she wishes to be paid for the time off.

If employees cannot make it in to work, can I require them to take annual leave instead?

You cannot insist that an employee take annual leave without giving appropriate notice. Such notice should specify the day or days on which you require the employee to take leave and must be at least twice the period of leave you require the worker to take. For example, if you require the employee to take one week’s annual leave at a particular time, you must give the employee at least two weeks’ advance notice.

However, there is nothing to stop you asking if an employee would like to take a day’s holiday because of being unable to attend work on that day.

If I close the business because problems with public transport stop employees from turning up to work, do I have to pay staff?

You may choose to close your business if disruption to public transport means that a significant number of your staff, or a few key individuals, cannot get into work. Depending on the nature of the work, some employees may be able to work from home, in which case you must pay them their normal wages.

If employees are not able to work due to your decision to close the business temporarily, this will in effect be a period of lay-off. You should pay the employees their normal wages during this period, unless there is a contractual provision allowing for unpaid lay-off, or the employees agree to being laid off without pay. In the absence of the employees’ consent, or a contractual right to lay them off without pay, a failure to pay them would amount to a breach of contract on your part. Employees may also claim that you have made an unauthorised deduction from their wages.

What if employees have a contractual provision for a period of lay-off without pay?

Even where there is contractual provision for a period of lay-off without pay, the employees may be entitled to a statutory guarantee payment, up to a maximum of £22.20 for any day when work is not available.

To be eligible for a guarantee payment, an employee must have at least one month’s continuous employment ending on the day before the day the business is closed. He or she must remain on standby to be available for work if you reasonably request this. There is no obligation on you to pay an employee who unreasonably refuses an offer of suitable alternative employment for a day when the business is closed.

Is there a minimum workplace temperature below which employees cannot be expected to work?

The Workplace (Health, Safety and Welfare) Regulations 1992 states that, during working hours, the temperature in all workplaces inside buildings shall be reasonable. However, the Regulations do not provide a minimum workplace temperature. Whether or not a temperature is reasonable will depend on factors such as the nature of the workplace and the type of work that is being carried out.

The Health and Safety Executive provides guidance on the Regulations, which recommends a minimum temperature of 16°C for workplaces where the activity is mainly sedentary, such as offices. For workplaces where much of the work involves physical effort, the minimum recommended temperature is 13°C.

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