In this newsletter we look at legislation updates, case law judgements, and settlement agreements.
We hope you find this information helpful, if you would like more detail on any aspect please contact us. Don’t forget to take a look at our website to see the full range of our services.
From basic Contracts of Employment to a fully Outsourced HR service we can help. If you would like to know more about any of our support, consultancy, and training services, and see how we can help you, please visit our website or contact us at info@connectivebusiness.co.uk to arrange a Free no-obligation consultation.
Legislation Updates
Employment (Allocation of Tips) Act
Withholding tips from workers is set to become illegal under the Act, which will come into force on 1 October this year. The statutory code of practice, which outlines the requirements for employers under the new legislation, states they will need to distribute tips in a “fair and transparent manner” and pass on all tips and service charges to workers without deductions. Employers will also have to maintain a written policy on how tips are dealt with at their place of business and ensure the policy is made available to all their workers. They will need to keep a record of all tips paid at their place of business, as well as their allocation and distribution.
The statutory code of practice states that:
- workers will be able to enforce their rights under the Act through the employment tribunal system. If the tribunal finds the complaints are well founded, they can make a public declaration of this and order the employer to revise a previous allocation of tips, or to pay workers compensation.
- allocating and distributing tips fairly does not necessarily mean employers have to allocate the same proportion of tips to all workers. However, it states they should use a “clear and objective set of factors” to determine this, such as:
- Type of role or work
- Basic pay
- Individual and/or team performance
- Seniority or level of responsibility
- Length of time served with the employer
- Customer intention
It also highlights that employers must avoid unlawful discrimination when selecting and applying these factors for allocating tips.
- employers should consult with workers to seek agreement that the system used to allocate tips is “fair, reasonable and clear” and the factors they decide to consider must be stated in the company’s tipping policy.
The new law will also require employers to be “transparent” in their allocation of tips, meaning workers have to be aware of their entitlements in the tipping policy, so they can effectively challenge it if they consider it to be unfair. This means businesses must maintain a record of the allocation and distribution of tips for three years, and workers will have the right to request to view it
Worker Protection Act
The Act is set to take effect from 26 October this year, requiring employers to take ‘reasonable steps’ to prevent sexual harassment of their employees.
Employers have an anticipatory duty under the new legislation and should therefore proactively identify situations when their workers may be subject to sexual harassment in the course of employment and implement measures to prevent harassment taking place. If sexual harassment has taken place, the preventative duty means an employer should take action to stop sexual harassment from happening again.
Whilst there is no guidance on what constituted ‘reasonable steps’, employers should ensure they are carrying out risk assessments, reviewing contracts policies and procedures, implementing regular training sessions and providing accessible channels for employees to voice concerns.
If a tribunal finds a business failed to take steps to protect workers, it will be able to order them to pay a 25 per cent uplift to any award of compensation for sexual harassment.
Case Law
Tracking / Carry-over of Annual Leave
A recent case `concerned a dispute over holiday entitlement and highlights how the recently amended WTR carry-over rules may impact payments due when employment ends.
In brief, the Employment Tribunal (ET) ruled that the employee in question had been able to set his own hours and therefore had not been prevented from taking his holiday entitlement, as such no carry-over of unused holiday applied in this case. The employee appealed. The Employment Appeal Tribunal (EAT) held that the ET had been entitled to find that the employee could have taken leave and the rules allowing for carry over did not apply. However, consideration needed to be given to whether there had been a failure by the employer to give the employee sufficient warning in respect of the need to take the leave and the consequences of him failing to do so. It was directed that the case be remitted back to the ET for this issue to be fully addressed.
The decision highlights the importance of employers having in place a system under which workers are informed of their holiday entitlement and the requirement that they take it before the end of the year or that they risk losing it. The fact that the employee has the opportunity to take it may not alone be sufficient. The onus will be on the employer to show that it had taken steps to encourage the employee to take the leave. This is due to the paid leave entitlement under the WTR being recognised as not just a benefit but as a requirement to protect the health and safety of workers.
Training
Operational Managers are key to a Company’s success, and how they work with and manage their teams is an essential part of this. Failing to provide them with the essential training they require will lead to more issues within the workplace.
We run a number of ‘1 to 1 HR Coaching for Managers’ modules, all of which are delivered remotely via Microsoft Teams:
- Being an Effective Manager / Responsibilities of a Manager;
- Dealing with Misconduct (Discipline), Poor Performance (Capability) and Grievances;
- Managing Attendance / Sickness Absence;
- Managing Performance / Developing People;
- Dealing With Conflict;
- Managing Recruitment;
- Managing Investigations.
Each module is focussed on the key elements involved, and takes around 1½ hours, with Managers also completing a workbook containing a number of questions and scenarios which is then analysed and feedback provided to ensure an in-depth understanding of the subject(s).
More details on all of the above can be found on our website.
Focus on HR / Employment Law: Settlement Agreements
When putting any settlement agreement in place, employers must ensure it is carefully drafted and tailored to the employee concerned to increase their likely enforceability. As well as the specifics for the employee, it is also advisable to note that settlement agreements should cover other general elements such as:
- A statement that payment of the compensation payment is a strict condition of compliance with certain terms, such as not making any derogatory comments about the employer or its employees, keeping the terms of settlement and circumstances surrounding termination of the employment relationship confidential and the return of all company property. This will increase the chances of being able to withhold payment or sue the employee to recover the compensation payment if these obligations are breached;
- Ensuring the ‘entire agreement’ clause in the agreement does not override any terms of the employee’s contract of employment that continue to apply after the employment has ended, such as any post-termination restrictions relating, for instance, to soliciting the business of any customers that the employee has had dealings with in the 12 months before the termination of their employment, and regarding misuse of confidential information;
- A warranty that the employee has not received any offer of alternative employment at the time of signing the agreement. This can be a particularly helpful provision because a large proportion of the value of most tribunal claims is for compensation for future loss of earnings.
Partner Services
We have long-term partnerships with key providers which enables us to provide other recommended services to our clients covering:
- Financial Services;
- Health Insurance and Staff Healthcare Benefits;
- Health and Safety.
Visit our website to see full information on our partners and their services.