Keeping up to date
We take seriously our responsibility to keep you up to date so that you can use changes in employment law to commercial advantage. By understanding and interpreting the latest case law and legislation we can deliver updates to you that are concise and usable. With imagination, we are able to ensure that developing law can be used to allow you to achieve commercial solutions, cost effectively and expediently.
Business change on the horizon?
If you’re thinking there might be business change on the horizon and the potential for redundancy, you’ll need to identify that you have a genuine redundancy situation.
It sounds simple, but it’s not always intuitive – here are a few things for you to consider:
The same amount of work – even if you have the same amount of work, if you now need fewer people to do that work, it is still likely to be a redundancy situation.
Reduction in work – if you have a reduction of a particular kind of work but the same number of employees needed, asking employees to change what they do perhaps by reducing their role or hours, may amount to a redundancy.
Practical reality – you need to focus on the practical reality of the role and not what was written down in a job description years before (if that’s different from what’s happening on a day-to-day basis).
Adding to a role – it will be a redundancy situation if it means that the particular kind of work that the employee is doing is disappearing or reducing.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Employment contracts and the ‘3Cs’ – pt.4 | Contemporary
Did you know, fewer than 20% of employees actually read their employment contract before signing? That’s staggeringly low for such an important document, and why our last ‘C’, contemporary, is key to boosting engagement.
Here are my top tips for creating contracts that are engaging, practical…and actually read:
Stop writing in the third person – swapping ‘the Company’ for ‘we/us’ immediately creates a connection with your audience and creates a more personal, interesting and engaging read.
Cut out the jargon – if your reader is having to wade through little understood terminology you’re losing their attention, fast! Employment contracts should be user-friendly and easy to understand throughout.
Intuitive layout – create a ‘start, middle and end’ that corresponds with the employment journey to make it easier to navigate and find relevant detail.
Keep it simple – don’t worry about catering for every eventuality. From a legal perspective that can be unhelpful and means the length of the document will in itself switch off the reader.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Employment contracts and the ‘3Cs’ – pt.3 | Commerciality – avoiding unnecessary costs
This is the second part of what ‘commerciality’ means for your employment contracts. You don’t need to include these provisions, but in doing so you’re giving yourself the potential opportunity to avoid unnecessary costs for your business.
Here are my top three ‘quick wins’ to help save some cash within your contracts:
Holidays – departing employees often lose their ‘mojo’ during their notice period – it’s human nature. By requiring them to take accrued unused holiday during their notice period, you save on paying them a lump sum in lieu of untaken holiday when they leave.
PILON – payment in lieu of notice clauses are important, but costly. You’re paying a lump sum for someone to avoid working for you! How can you minimise the cost of PILONs? You can stagger payments and require departing employees to start their job search immediately, and then to tell you when they’ve found a new job. If you add in that they must start their new job as soon as an offer is received, you can potentially end notice pay at that point (provided you’ve paid at least the statutory minimum).
Probationary periods – save unnecessary admin and cost by commencing pension contributions once the employee has successfully completed the first three months of employment. You can also limit notice periods during probation – that way, if you feel that the individual doesn’t have the skills for the role, or simply just doesn’t ‘get it’, you can limit notice costs during this period.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Employment contracts and the ‘3Cs’ – pt.2 | Protecting business interests
What do we mean when talking about ‘commerciality’ in employment contracts? Well, it’s all the stuff that you don’t need to include but can choose to add in order to protect your business interests and what matters most to you.
There’s loads I could go into but my top tips would be:
Reflect reality – what’s important to your business will change over time. If you don’t think about updating your employment contracts as your business evolves, their value and effectiveness will dilute over time.
Protecting know-how – think about what makes your business unique. Your proposals, pitches, products, pricing…I could go on! They’re all capable of being protected, but you need to call them out in your contracts! Otherwise, they’re often fair game to departing employees.
Post-termination restrictions – “they’re not enforceable!”…if I had a pound for every time I’ve heard that! They’re definitely easy to get wrong, but are enforceable when drafted appropriately. Restrictions that aren’t specific or drafted tightly enough are highly unlikely to be upheld. You need to make sure the terms of the restrictions don’t go further than necessary to protect your legitimate business interests – stating an employee can’t ever work for a key competitor isn’t going to work unfortunately!
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Further Brexit announcements
Following the announcement last week that all EU-derived law will remain unless specifically repealed, the government has announced their intention to make changes to the Working Time Regulations and TUPE provisions following Brexit.
Rena Christou, Halborns’ Managing Director, shares her thoughts:
Working Time Regulations
Rolled up holiday pay to be allowed – there are plans to allow holiday pay to be included within hourly pay (particularly relevant for zero-hours or agency workers). This could mark a significant and welcome change for employers.
Merging holiday entitlements – employees’ holiday entitlement is currently split into two parts (4 weeks based on EU law and 1.6 weeks based on UK law). The proposal is to merge the two. My view is this should simplify the admin of managing the two different entitlements, but at the moment we’re unclear how this will be achieved and how it will affect holiday pay calculations.
Recording working time not required – whilst this sounds appealing there will still be the need to maintain “adequate records” for the purposes of National Minimum Wage and holiday pay. How this will change things in practice is unclear.
Changes to TUPE consultation
The plan is to remove the requirement to consult with appointed representatives for businesses with fewer than 50 employees and transfers affecting fewer than 10 employees. My view is this is a welcome change to ensure more appropriately facilitated communication for smaller TUPE transfers.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Legal lightbulb – people law, policy and practice
Annual tribunal limit increases
The Employment Rights (Increase of Limits) Order 2023 has been published, listing the usual annual tribunal award increases. The main increases to be aware of are:
- Maximum compensatory award – now £105,707 (was £93,878)
- A week’s pay for basic award and redundancy payments – now £643 (was £571)
New guidance on voluntary ethnicity pay gap reporting
The government has published guidance for businesses wanting to voluntarily publish their ethnicity pay data. The aim being to develop a consistent approach for businesses to follow in order to allow meaningful comparisons to be drawn.
The guidance provides advice on how to collect data, consideration of data protection issues such as maintaining confidentiality, calculations, reporting, and plenty more. Get ahead and have a go!
New Autism Employment Review announced
The focus of the review is on supporting businesses to recruit and retain individuals affected by autism and to benefit from a more neurodivergent workforce. Currently, less than three in 10 people with autism are in employment – the review will consider how employers can identify and better support individuals, as well as reducing the stigma around neurodiversity.
We’re creating a ‘neurodiversity toolkit’ for employers – get in touch to find out more.
People dates for your diary – June 2023
01-30 | Pride Month
05-11 | Bike Week
05-11 | National Growing for Well-being Week
12-18 | Men’s Health Week
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Employment contracts and the ‘3Cs’ – pt.1 | Compliance
It’s safe to say I’ve seen a few employment contracts in my time! A non-compliant employment contract can be expensive – a tribunal can award up to four weeks’ pay for each out-of-date contract you’re using.
Key areas of compliance for employment contracts were introduced in 1996 by the Employment Rights Acts…there’s no excuse for getting those elements wrong! More recently in 2020, the Good Work Plan added more red tape with further compliance requirements which employers have been slow to adopt. Here are the top five areas I’ll see regularly missing from employment contracts:
- Any paid leave the employee benefits from (maternity or paternity leave, for example)
- Details of all remuneration and benefits (such as enhanced maternity pay or private medical insurance)
- Training requirements for the role, whether they’re mandatory, and who will pay for the training
- Whether working hours are variable (or not as the case may be)
- The correct statutory minimum notice employees are entitled to (one week for each complete year they’ve worked for you, up to a maximum of 12 weeks)
Reference to these areas needs to be included within the contract, even if they don’t apply. If there is no training requirement for example, you need to say as much.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Bank holiday 08 May – King’s coronation
Some employees will be entitled contractually to the bank holiday (taking the decision out of your hands unless they’re happy to agree to something different). In summary, if the employee’s employment contract says their holiday entitlement is:
- Plus bank holidays – they’re entitled to the day off;
- Plus eight or usual bank holidays – they’re not entitled to the day off;
- Inclusive of bank holidays – they’re entitled to the day off but this comes out of their existing holiday entitlement because it already includes bank holidays in the calculation.
Of course, even if the contract doesn’t allow for employees to take off the bank holiday you can agree to a variation by giving them the extra day or you could offer to pay them in lieu. Any variation should be confirmed in writing.
This update is accurate on the date it was published, but may be subject to change which may or may not be notified to you. This update is not to be taken as advice and you should seek advice if anything contained within affects you or your business.
Well-being watch – four-day working week
The trial – 61 UK companies trialled the “100:80:100” model for six months – that’s 100% pay, 80% hours, 100% productivity. Of those 61 companies, 56 have extended the trial period, including 28 who have made it a permanent arrangement.
Well-being wins – 71% of employees reported lower levels of burnout and 39% said they were less stressed than at the start of the trial period. The trial found a 65% reduction in sickness absence and a boost to retention with a 57% drop in the number of employees leaving compared to the same period the year before.
Poor productivity? – the trial saw a 1.4% increase in revenues with participants (across a wide range of sectors) seeing healthy growth during the trial. Employees were found to be more proactive through their own improved efficiency, whether through technology, fewer meetings, or simply a lower inclination to kill time.
Employment law implications – we are lawyers, after all! If you want to trial a four-day week you’ll want to think about how you’ll treat fairly those already working part-time, what the impact will be on holidays and benefits, and how you’ll give the business flexibility if it doesn’t work out (to name a few).