Employment Law Update March 2011

Thanks to David Buckle for this great update on . We hope you find it useful!

For some time, Parliament has adopted the practice of launching new employment law in April and October of each year. This April is no different.

Next month sees those parents (usually fathers) of children born or adopted after 3 April 2011 get the right to take up to 26 weeks paternity leave, if the mother/primary adopter) returns to work early.

The default retirement age is also being phased out. New Regulations state employees who are 65, or will be 65 by 30 September 2011 can be only be retired if they are given notice by 5 April 2011. Where long notice is given (say 12 months) there is a longstop of 5 January 2012 for an employee to exercise their right to request to work beyond retirement. This means the last possible date for retirement of an employee under the existing law will be 3 October 2012. This would cover the employee who was given 12 months’ notice of retirement on 5 April 2011, taking them to 4 April 2012, and then given the maximum six month agreed extension, which can be given without a fresh notice of intention to retire, ending on 3 October 2012. All clear? As mud.

Further confused legislation in the form of the Bribery Act 2010 was due to come into force in April 2011, but luckily this is under review and is expected mid 2011. This will introduce a new corporate offence of failing to prevent bribery by individuals acting on behalf of an organisation and will require employers to have “adequate procedures” in place to prevent bribery and corruption.

Agency Workers Regulations

Of most concern are the Agency Workers Regulations 2010 which are due to come in on 1 October 2011.

These will mean that after 12 weeks in the same role, agency workers will be entitled to basic working conditions that are no less favourable than employees recruited direct by the hirer.  I will write more on this later this year.

On the money front, the tax concessions for legal fees on termination of employment will be reduced and no longer apply to cases settled through ACAS conciliation. Also amendments to the PAYE Regulations will mean that payments after employers have issued a P45 must be subject to a full rate tax deduction. At present, income tax can be deducted at basic rate only. Also from 6 April 2011 there will be a reduction to small employers’ relief for statutory maternity pay. Small employers are entitled to recover 100% of their statutory maternity pay from HMRC, together with a percentage compensatory amount. From 6 April 2011, the compensatory amount will reduce from 4.5% to 3%.

Finally, on the immigration side, the Worker Registration Scheme, which requires nationals of eight Member States that joined the EU in 2004 to register when they start work in the UK will end on 1 May 2011.

This month’s developments in case law

The European Court of Justice has given a much publicised decision stating insurers can no longer discriminate by using gender as a factor in assessing risk. Potentially good and bad news for your car insurance renewal depending on your gender. The Court of Appeal also discharged two injunctions against strike action by rail unions. In doing so it has made it easier for strikes to occur. For male commuters at least it will be cheaper to drive to work when the trains are not working.

The Employment Appeals Tribunal wins the award for the most obvious decisions of the month. It has upheld a decision that a heterosexual employee who was subjected to homophobic banter did not suffer harassment because of his own “extremely offensive behaviour” and that he remained friends with his tormenters and had not complained about them. It has also handed down a decision that confirmed that without “mutual obligations”, there can be no employment relationship. In this second case, a taxi driver engaged for just over six weeks did not receive any notice, holiday and sick pay. As the driver was under no obligation to accept work and the taxi firm was under no obligation to offer work, it held he was not an employee and could not claim these amounts.

By way of general interest an Employment Tribunal has also found anti-fox hunting beliefs capable of protection under discrimination law. It was seen as a belief in the sanctity of life, extending to a fervent belief in anti-fox hunting and anti-hare coursing. Whilst the Tribunal emphasised that its decision was based on specific facts and that not all the opponents of fox hunting were necessarily protected, this decision mirrors earlier cases which supported “green” beliefs in the same way. No doubt this will be appealed and will add to the number of cases the President of the Tribunal predicts for next year.

This article was written by David Buckle of Cubism Law