Five Things an Employer Needs to Know About Employment
It is an unavoidable demand of running any business that an employer must have a good knowledge of employment law whether they are self employed and/or employ other staff. They should have an awareness of the rights of the employee, the employer themselves and where each party stands in the unfortunate event that the normal working relationship breaks down. This article addresses the five key areas that employers and HR departments need to consider when dealing with employment law in the UK.
- How You Define Employees and Employers
It is important, before delving into the intricacies of employment law to have a clear idea of the parties that are involved and how their roles should be defined.
- Employed vs Self Employed: This distinction can be less apparent than you may think. If a worker has agreed to provide a service/work under contract for an organisation then they will be a worker employed by that organisation unless the organisation is actually employing the services of that individual’s business, in which case the worker is self-employed and thus not a direct employee of the organisation. An example of such a scenario would be a contractor who offers his services to an employer via his own business rather than agree a direct contract of employment himself.
- Part Time vs Full time: This is a heavily contextualised concept as the hours a full time employee works in one organisation could be the same as the hours worked by a part time employee in another. Once an organisation has set the hours that a full time employee is expected to work, a part time employee is defined as a worker employed on the same contractual basis but for reduced hours. The key thing to remember here is that part time employees should not be treated any less favourably in comparison to their full time counterparts purely because of the difference in hours that they work, unless their hours are a justifiable factor in the decision process. For example, pay should always be awarded on a pro-rata basis for part time workers in comparison to an equivalent full time role. Employees have the right to challenge and demand written explanations if they think that they are being treated differently on this basis alone.
- Temporary vs Permanent: This distinction depends upon the contract of employment which we will discuss later on. The temporary or fixed term worker will have a contract which agrees their employment for a fixed period of time as opposed to an ongoing permanent relationship. As with part time workers, temporary workers must not be treated any differently to their permanent counterparts purely on the basis that they are on fixed term contracts.
- Statutory Rights
These are the rules that govern and provide the framework for how you will need to deal with your staff from the start of the recruitment process to the cessation of the contract of employment. They cover not only the definitions of employment types mentioned above but every other area of individuals’ rights in the work place. They are too broad and detailed to discuss in their entirety here but, in summary, include:
- Minimum Pay – Rates for over 16s, varying for different age groups
- Equal Pay – Contracts for women employees must include the same pay and benefits as that of a man in an equivalent role
- Pay Slips – To be itemised and provided before or on the date of pay
- Discrimination – Employees must not be discriminated against based upon “protected characteristics” such as age and sex. Provisions must be in place for disabled workers
- Equality Act 2010 – Employers do have the right to choose between two candidates of equal ability on such a characteristic if it is under-represented amongst their staff
- Maximum Working Week – 48 hours, regular breaks etc. Opt outs can be agreed but not demanded
- Flexible Working – Parents of children up to 18 years old have a right to apply to changes to their hours and work location which an employer can only refuse if specific circumstances are met
- Parental Leave
- Maternity Leave – 26 weeks ordinary and 26 weeks additional entitlement
- Paternity Leave – 2 weeks entitlement with additional 26 weeks when mothers return to work
- Sickness – Statutory sick pay entitlement etc
- Compassionate Leave – Employees have a right to time off (but not pay) if they have illness or death in the immediate family
Whistleblowing – Protection for some disclosures in specific circumstances which would otherwise breach the employee’s contract.
Workplace Health & Safety (see below)
Redundancy – When an employee’s role is no longer required.
- Statutory Pay
- Notice Period
- Relocation Opportunities
TUPE – Conditions of employment must be transferred in the event of a take over.
Pensions – Most employers must offer employees a stakeholder pension provision.
Dismissal & Disciplinary
- Unfair Dismissal – The employer must have a fair reason (e.g., employee conduct) to dismiss an employee with 1 years employment and must follow a fair dismissal procedure. Some reasons for dismissal will qualify to be considered as automatic unfair dismissals such as union action, time off for parenting etc
- Wrongful Dismissal – Notice must be given by all parties (unless a fixed term contract is lapsing) as set out in common law
- Constructive Dismissal – If an employer breaks the terms of a contract and consequently forces an employee’s dismissal
Retirement – The Default Retirement Age is ultimately due to be scrapped by Oct 2011 although there are certain measures already in place to reach this end (Retirement is therefore no longer a fair reason for dismissal).
One of the most essential things to remember with statutory rights is that they are regularly changing. As an employer or HR worker you must remain familiar with the latest developments.
- The Contract
Perhaps the most important element of any employer-employee relationship is the contract of employment. All parties will have certain statutory rights as mentioned above but the finer details and practicalities of the relationship will be contained in the employment contract. The contract will determine the procedures to follow in the event of staff under-performance or disciplinary proceedings, any employee benefits and concessions above and beyond their statutory entitlements (e.g., maternity leave, compassionate leave) and ultimately the conditions and processes of releasing staff either through dismissal, redundancy or resignation.
- Trade Unions
If you are an employer of more than 21 individuals you may be approached by a trade union seeking recognition from your organisation. The Trade Union needs to show that it has a 10% representation in your workforce and that those members wish your organisation to acknowledge it. You will have 10 days to respond to the request otherwise you will have effectively rejected the approach. In the event of rejection the Trade Union can apply to Central Arbitration Committee to force you to accept their approach for recognition. Once a Trade Union has been recognised, an employee is entitled to take part in industrial action organised by the union (for a period of up to eight weeks) if the industrial action was called for by an official Trade Union ballot. Any dismissals resulting from this action would automatically qualify for unfair dismissal.
- Health And Safety
An employer is obliged by common law to provide a safe working environment and to ensure that their workers are fully competent in the roles they are filling. However employers are also bound by statutory requirements which reinforce these obligations and the fact that all employees must, at all times, be fully capable, be trained in the safety procedures that they must follow and be aware of the Health & Safety Act 1974.
To this end employers are also required to perform regular assessments of the risk in the workplace, not only to their own employees but any other individuals who may be affected. Employers of at least five members of staff must document these assessments and are in addition required to produce a documented health and safety policy which is communicated to all members of staff.
There are many more requirements that an employer must be aware of to fulfill these objectives and specific additional regulations which apply to particular industries and workplaces.
As you can see employment law is a very broad and nuanced topic and it takes a fair amount of effort and time to become familiar with it. Therefore, if you are in doubt, or you need guidance on a specific circumstance you should seek advice from a qualified employment law specialist, such as Employment Solicitors Basingstoke to make sure you take the easiest and most economical path to a resolution.