Are you up-to-date with changes in employment law?

This bulletin contains the recent changes as of:

October 2015
National Minimum Wage – 1 October 2015
Modern Slavery and Human Trafficking Statement – 1 October 2015

April 2016
National Living Wage – April 2016

Other important updates
Fit for Work – National Roll Out
Case Law Update

October 2015

National Minimum Wage – 1 October 2015

This October the National Minimum Wage hourly rates has increased as set out below:

  • Standard adult rate (workers aged 21 and over): £6.70
  • Development rate (workers aged between 18 and 20 inclusive): £5.30
  • Young workers rate (workers aged under 18 but above the compulsory school age who are not apprentices): £3.87
  • Apprenticeship rate (apprentices who are under 19 years of age or those aged 19 and over but in the first year of their apprenticeship): £3.30

Non-compliance with National Minimum Wage is being heavily penalised, therefore businesses will need to undertake a full review to ensure that the above rates are captured correctly, particularly those who have recently moved from one age bracket to another.

Modern Slavery and Human Trafficking Statement – October 2015

This applies to commercial organisations that are supplying goods or services and have a turnover of £36m or more. Such organisations will have to produce a statement each financial year, published on the organisation’s website, with a prominent link from the home page.

The Modern Slavery Act 2015 maintains that the statement can contain information about:

  • the organisation's structure, its business and supply chains;
  • its policies in relation to slavery and human trafficking;
  • its due diligence processes in relation to slavery and human trafficking in its business and supply chains;
  • the parts of its business and supply chains where there is a risk of slavery and human trafficking taking place, and the steps it has taken to assess and manage that risk;
  • its effectiveness in ensuring that slavery and human trafficking is not taking place in its business or supply chains, measured against such performance indicators as it considers appropriate; and
  • the training available to its staff.

April 2016

National Living Wage – April 2016
The government will be introducing a new mandatory National Living Wage (NLW) for workers aged 25 and above, initially set at £7.20.

Meaning that a worker who is currently aged 25 and receiving the National Minimum Wage of £6.70 per hour will receive an increase to £7.20 per hour.

Employers should undertake a strategic review now to assess the impact of the increase on their business. In certain sectors it has been recognised that this increase can potentially cause concerns around profitability. Such businesses should assess the impact early on and identify strategies for minimising the negative impact on profits at the point the increases will apply.

A new team of compliance officers at HMRC will focus on those who deliberately do not comply and they will have the authorisation to use sanctions including penalties and prosecutions, in addition to naming and shaming.

Employers who do not pay the appropriate rate will be considered for disqualification from their director role for up to 15 years. These are measures put into place by the government in an attempt to ensure workers receive the government set rates.

Other important updates

Fit for Work – National Roll Out
The new Fit for Work (FFW) service is free and intends to proactively manage long-term sickness absence. Following an initial pilot scheme earlier this year, FFW is now being rolled out nationally.

The trigger is an employee who has been absent for four weeks or more, and have a reasonable likelihood of making a phased return to work. Normally the GP will refer the employee to FFW, however an employer can also request it. The following briefly summarises what will take place:

  • Telephone assessment by an occupational health professional to ensure they identify the full range of issues preventing a return to work. This professional then becomes the case manager;
  • A Return to Work (RTW) plan will be agreed where possible and emailed to the employer and the employee’s GP (with the employee’s consent). The plan will state whether an employee is fit for work or whether they may be fit for work subject to the employer following certain recommendations;
  • The case manager contacts the employee during the life of the RTW plan to check if it is on schedule. The case manager may consider whether further assessment is required if employee does not return as anticipated and may also facilitate RTW through liaison with employer and employee. 

Employers will be expected to take the RTW seriously and consider its recommendations. Although, the employer does not have to follow the RTW Plan it will need to have very sound business reasons for not doing so.

A Return To Work plan can be produced as evidence of fitness to work instead of a fit note.

The FFW scheme does not stop an employer seeking their own occupational health specialist report which may be particularly useful where the employer does not agree with the RTW plan provided.

Case law update

Travelling for work or to and from work
A ruling by the Court of Justice of the European Union (CJEU) has stated that time spent travelling by workers, with no fixed place of work, to their first and from their last journey of the day is classed as working time. This is a ruling about working time (in relation to the Working Time Directive) and not about pay. It does not automatically follow that a worker is entitled to be paid however there is a case going through the courts at the moment where the challenge is just that.

For example, a care worker is claiming they should have been paid at least the National Minimum Wage for travel time. The claimant had to travel from one appointment to another, and it is this travel time that meant that some working days were as long as 12 hours. Their pay was based on a 7.5 hour day at an hourly rate of £7.68 but for those days when they worked longer, the hourly rate then fell below the National Minimum Wage.

Tribunal fees here to stay (for the time being)
Unison’s attempts to have employment tribunal fees removed has been rejected by the court of appeal due to lack of evidence. It is expected that Unison will take this to the supreme court.

Caste Discrimination covered by Equality Act 2010
The claimant, a domestic worker, was of a caste which some in India consider a low caste and claimed she was forced to work for 18 hours a day, seven days a week and had to sleep on the floor by her employer. The claim for unpaid wages was successful and was awarded £184,000 in unpaid wages and a further hearing is to take place regarding compensation for discrimination and other claims.

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