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Latest Brief - Week Ending 1 December 2017

Another important holiday pay case!

The latest holiday pay case from the European Court of Justice has unfortunately created further difficulties for employers in working out their obligations in respect of holiday pay.  

The case before the court involved an individual who his "employer" believed to be self-employed.  The employer did not therefore give the individual paid holiday, and the employee did not seek to take holiday as a consequence.  A Tribunal found that he was in fact a worker, and therefore entitled to 5.6 weeks' annual leave per year.  
The court held that a worker is entitled to be paid on termination for any periods of annual leave accrued during employment, where the worker has been discouraged from taking this leave because it would have been unpaid, and this would include unused holiday carried over from previous years.  Crucially, the court held that there was no limit on the amount of leave that could be carried over in this type of case.  Back pay claims for the 4 weeks leave under the Working Time Directive can therefore potentially go all the way back to 1996 when the original Working Time Directive came into force.  This decision will have significant implications for workers who have been misclassified as independent contractors, and potentially gives these individuals the right to many years of unpaid holiday pay.  The decision also potentially casts doubt on the legality of the recent Regulations implemented by the UK which limit back pay to 2 years.  We will have to watch this space to see if more clarity on this point is forthcoming.   

Proposed increases to statutory maternity, paternity, adoption and sick pay rates

The government has announced the following proposed increases to statutory benefit payments:
Statutory maternity, paternity, adoption, shared parental pay and maternity allowance will increase from £140.98 to £145.18 per week.

Statutory sick pay will increase from £89.35 per week to £95.05 per week.  The increase would usually occur on 1st April, but the statement from the government suggests that the increases will in fact take effect from 9th April 2018.

Latest Brief - Week Ending 24 November 2017

Autumn budget - implications for employment law

This week has seen the Government's autumn budget published and there are a few areas which will impact upon employment law.  Firstly, the Government has confirmed that increases to both the living wage and national minimum wage will be brought in from April 2018.  These will be as follows:

  • From £7.50 to £7.83 for workers aged 25 and over (living wage);
  • From £7.05 to £7.38 for 21 to 24 year olds;
  • from £5.60 to £5.90 for 18 to 20 year olds;
  • from £4.05 to £4.20 for 16 and 17 year olds; 
  • and from £3.50 to £3.70 for apprentices.

The Government will also publish a discussion paper exploring the case and options for longer-term reform, as part of its response to the Taylor review of employment practices, and will increase the tax free personal allowance.

Can giving a false reason for dismissal be a breach of the implied term of trust and confidence?

Yes.  The EAT has held that in circumstances where an employer decides to give a reason for the termination of employment, the employer assumes an obligation not to mislead.  In this case, an employee was informed that he was going to be dismissed due to a reorganisation rather than because of his capabilities.  The employee in this case then resigned and brought a breach of contract claim.  The employer had wanted to soften the blow of dismissal, in part because it wanted the employee to work his notice period and carry out a full handover of his work.  The EAT held that the employer's actions in misleading the employee as to the real reason for his dismissal were intended to keep the employment relationship alive, and did not relate to the manner of the employee's dismissal.  Therefore the employer's actions in misleading the employee constituted a breach of the mutual term of trust and confidence here. 

It can often be tempting for employers to try to soften the blow to an employee, by providing an alternative reason for dismissal.  This case is a reminder that this can come back to bite an employer!   

New ACAS Guidance

ACAS has this week produced new guidance on both sexual harassment at work, and also on how to prevent pregnancy and maternity discrimination at work. 

The guidance on sexual harassment highlights a number of behaviours that could be interpreted as sexual harassment, recommends that employers have policies in place to ensure that any incidents are quickly resolved, and explains what action to take when historical allegations are reported.  

The guidance on pregnancy and maternity discrimination comes after ACAS received 14,000 calls about pregnancy and maternity discrimination in the last year.  The guidance recommends ensuring that employees on maternity leave are aware of all promotion and training opportunities, and developing a policy that includes assurances that pregnant employees (and those on maternity leave) will not be dismissed or made redundant as a result.

The ACAS guidance on sexual harassment at work can be found here:

http://www.acas.org.uk/index.aspx?articleid=6078 

The ACAS guidance on pregnancy and maternity discrimination can be found here:

http://www.acas.org.uk/index.aspx?articleid=5271