Legal

Welcome to our Legal Eagle page.

    Employment legislation is constantly changing and considering the changes in April 2009, and Annette has been lecturing and writing to the Commercial clients of the practice in relation to the following:

1. Table of current rates and limits

National Minimum Wage rates from 1 October 2008:

                      Workers aged 22 and over -           £5.73 per hour

                      Workers aged 18-21 -                    £4.77 per hour

                      Workers aged 16-17 -                    £3.53 per hour

                      Accommodation offset -                 £4.46 per day (£31.22 per week)

Tribunal Compensation post 1 Feb 2009

      Weeks pay                                   £350

       Minimum basic award                   £4,700

       Maximum basic award or

       maximum statutory redundancy    £10,500

          Maximum compensatory award     £66,200

          Guaranteed day rate (lay offs)       £21.50

2. Statutory Holiday Entitlement and amendments to the existing contracts

1. The statutory paid holiday entitlement has risen to 5.6 weeks from 1st April 2009.  For those working a five day week this is a raise to 28 days.  Part time workers must receive a pro-rata allowance.

2. Those working a 6 day week still have an entitlement of 28 days, as the entitlement is capped at 28 days.

3. As the increase in holiday is a beneficial change in the terms and conditions of employment for the staff, there is no need to reissue contracts or give employees time to approve.

4. If your holiday year does not run from April to March, the additional holiday entitlement will be calculated by multiplying the proportion of workers’ remaining holiday year by the additional holiday entitlement that applies in that year.

5. Bank Holidays can count towards the 28 days.

3. National Minimum Wage and the new HMRC powers

1. from 6 April 2009, businesses will face penalties if they do not comply with changes to how the National Minimum Wage is enforced by the HM Revenue & Customs (HMRC),

2. Compliance officers will be able to remove any relevant material in connection with enquiries into the national minimum wage including pay records from an employer’s premises for photocopying.

3. If HMRC find that there has been an underpayment of the national minimum wage in an investigation that is ongoing from 6 April 2009 they may issue a notice of underpayment requiring the employer to

·        repay arrears to the workers and

·        pay a financial penalty to the Secretary of State. Workers will be entitled to have arrears of wages repaid at current rates.

4. The financial penalty is set at 50 per cent of the total underpayment but there is a minimum penalty of £100 and a maximum penalty of £5,000. Employers who comply fully with the notice of underpayment within 14 days of service will receive a discount of 50 per cent on the penalty.

5. With effect from 6 April 2009, the most serious cases of breaches of the NMW will be triable in the Crown Court.

Do not forget the Accommodation Offset Provisions!

The rate of the accommodation offset is merely £4.46 per day (£31.22 per week)!

If an employer charges any amount of rent for accommodation, any rent charged above £31.22 per week will reduce national minimum wage pay.

Also, if an employer provides accommodation on an uncharged basis as part of a package, the rules allow the accommodation offset to count towards national minimum wage pay. Any rent the worker is obliged to pay as a condition of being provided with accommodation (including charges for gas, electricity, laundry and provision of furniture) must be regarded as a charge paid in respect of the provision of accommodation.

In other words, if your worker is 30 years old, is working 28 hour week, receiving £6.50 per hour in wages and pays you what is usual market rent in this area of £90 a week for their fully furnished accommodation including gas and electric bills, your worker is actually receiving a wage of £4.36 per hour!

Please note that some Directors can be classed as employees and the above provisions apply to them.

4. Flexible Working Rights

a.      From 6 April 2009, the right to request flexible working is extended to cover eligible employees with parental responsibility of a child aged 16 or under.

b.     The right previously applied - and continues to apply - to carers of children under six or disabled children under 18, as well as to employees who care for certain adults.

c.      Employers have a duty to consider such requests seriously and can refuse only having produced a proper business case for this refusal and having complied with the relevant procedure.

5. The Immigration, Asylum and Nationality Act 2006

a.      From 29 February 2008 there is a new civil penalty (up to £10,000) for employers of illegal workers.

b.     Also, the Act introduced a new criminal offence of employing a person knowing that they are not legally entitled to work in the UK. The sanction is up to 2 year imprisonment or an unlimited fine.

6. Employment Disputes and the new Code of Practice.

The existing dispute procedures are repealed and replaced with a new code produced by ACAS.

a.      From 6th April 2009, businesses are no longer required to follow the mandatory three-step process to dealing with grievances and dismissal. However, if the “trigger event”, which could be a letter of grievance or a letter inviting an employee to a disciplinary meeting, has been sent prior to 6 April 2009, then the old rules will apply.

Dismissals are no longer treated as “automatically unfair” if procedure is not followed 

The accent is on the fairness of the procedure, not the detailed compliance. However, it would be left for a tribunal to determine whether the applicable procedure was fair.

Employment tribunals can vary compensation. 

Employment tribunals will have the power to increase or reduce awards by 25% where the relevant Code of Practice has not been followed.

No tribunal hearing needed when all parties agree

A wider use of mediators is encouraged. When all parties give a written confirmation of their agreement (or where the respondent has not replied to the claim) a tribunal can now determine on a case without the need for a hearing. This will save legal costs and we can provide a mediator!

Sanctioning your employee:

Please revise your contracts and procedures to make sure that they specify appropriate sanction for certain misconduct (consider such modern issues such as Information Technology, Intellectual Property, etc). We have been known locally as a Company offering very competitive packages for revision or preparation of Contracts and Policies.