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Employment Law Bulletin October 2015

Thursday, October 15, 2015

Welcome

The Rugby World Cup 2015. A meeting of minds, muscles and mauls.

But for all the enthusiasm it generates, the tournament is another workplace distraction for employers to manage. Time off to watch matches; calling in sick to nurse a hangover. The reality is that entire workforces are being swept up in the excitement and businesses are having to try to keep up.

That is unless you’ve got a strategy worked out. For lots of employers, this means tackling the issues head-on: letting staff know what is and isn’t acceptable, and dealing properly with those who abuse the rules. But perhaps the real winners are those employers who recognise that this is an event that’s bound to spark interest and which has the potential to boost staff morale. They know it’s once every four years.  This time it’s close to home.  And they get involved.

October changes

October (along with April) is always a significant month for employment law. It’s when changes take effect. These include, from 1 October 2015:

- An increase in the National Minimum Wage from £6.50 to £6.70 per hour for those aged 21 and over. For workers aged between 18 and 20, it rises to £5.30 and for those aged 16 between 17 it’s £3.87. The apprentice rate is £3.30.

- A ban on smoking in cars in England, following the ban’s introduction in Wales. Smoking in any private vehicle is now prohibited if there are child (under 18) passengers. It’s worth looking at your policies on smoking and company cars in light of this change.

- Sikh workers who wear turbans will be exempt from wearing safety helmets in all workplaces and not just on construction sites, as was the previous rule. There are a few situations in which this exemption won’t apply.

Working time for mobile workers

Federación de Servicios Privados del sindicato Comisiones Obreras v Tyco

This is an important case for businesses in the construction, care, security and catering sectors. It also affects businesses that employ sales staff, engineers, or others who travel between customers.

The Court of Justice of the European Union has decided that mobile workers’ first and last journeys of the day will now count as working time. Workers (which covers employees) who don’t have a fixed office or base are ‘working’, for the purposes of the Working Time Directive, when they drive from home to their first appointment of the day and from their last appointment home. The Court decided that these are not ‘rest periods’, as the employer in this case had claimed.  It’s working time.

What does this mean for you?

First, you need to make sure that your workers aren’t ‘working’ too much and exceeding limits set by the Working Time Regulations. Remember all workers are entitled to a 20-minute rest break every 6 hours, and to 11 hours uninterrupted rest every 24 hours. You now need to include their travelling time as part of ‘working time’, meaning that the workers might be entitled to rest breaks – or, at least, different patterns of breaks – that they weren’t previously entitled to.

Second, there are implications for the maximum 48-hour working week. If the worker spends one hour travelling to their first site, and one hour returning home at the end of the day, this adds ten hours to their working week. If that pushes them over 48 hours (normally averaged over 17 weeks), you’re probably breaking the law unless they’ve signed a document opting out of their legal rights.

Third, there may be ramifications for pay. Contrary to what’s been reported in the national press, these hours won’t count for calculating whether someone is receiving the national minimum wage. So on the example above, just because an employee is working an extra 10 hours week, you don’t need to worry about their average hourly rate being pushed below the minimum wage. It won’t be.

But there may be other important points on pay. If they are paid by the hour, and your contracts don’t define what is meant by ‘working time’ (ie they don’t exclude this travel time), there is a risk that they will be able to bring a claim for unpaid salary at their normal hourly rate. Such claims can be backdated for up to two years in an employment tribunal, and up to six years in the small claims court.

You may need to think about introducing contractual changes, altering shift patterns and factoring in additional rest breaks. It’s worth talking to us to discuss the impact on your business, and how you’ll need to adapt.    

Scope of HR role in disciplinaries

Ramphal v Department for Transport

Mr Ramphal was suspected of misconduct relating to his expenses and use of hire cars. The manager who was appointed to carry out the investigation and disciplinary was inexperienced and turned to HR for help. So far, so good.

But the problems for the employer began when the HR officer’s input went further than just advising on the law, procedure and sanctions. In this case, HR appeared to have given advice on issues around Mr Ramphal’s credibility and culpability. A step too far?

Yes, held the Employment Appeal Tribunal (EAT). Drafts of the manager’s report had become more critical of Mr Ramphal following communications with HR who seemed to have influenced the manager’s views. The manager had initially concluded that Mr Ramphal was guilty of misconduct and should receive a final written warning. But that was later changed to gross misconduct and dismissal, seemingly at the behest of HR.

While it’s fine for a dismissing or investigating officer to ask for guidance, that guidance should be limited to law and procedure and to making sure that everything has been addressed and that there’s clarity. An employee in Mr Ramphal’s position is entitled to expect that the investigating officer will make their own decision, without being lobbied by others, held the EAT. They should also be given notice of changes to the case against them so that they can address them properly.

Enterprise Bill

A new Enterprise Bill has been published.

One point we think you need to know about is around the use of the term ‘apprenticeship’. It will be an offence for someone to describe a course or training it provides as an apprenticeship, unless it’s a statutory apprenticeship.

It’s all about protecting the term ‘apprenticeship’ and what it stands for, just as ‘degree’ is safeguarded. The Government wants to make sure that the apprenticeship brand can’t be misused through the delivery of lower-quality courses.

TUPE transfer where activities continue

Ferreira da Silva e Brito & Others v Estado Portugues

The TUPE Regulations apply to ‘relevant transfers’. One type of relevant transfer is a business transfer – the transfer of an economic entity that retains its identity. It’s not always easy to tell whether identity has been retained and, therefore, whether workers are protected by TUPE. And that’s what this case was all about.

Air Atlantis (AA) was wound up, and Mr Brito and more than 90 other employees were dismissed via collective redundancy. They claimed reinstatement and pay after the company’s major shareholder (TAP) took over AA’s planes, lease contracts, routes, offices and equipment. TAP had also taken on a number of former AA employees.

The Court of Justice of the European Union (CJEU) disagreed with an earlier court decision that there was no transfer.  Merely continuing a commercial activity didn’t by itself mean that a transfer had happened because the business also needed to retain its identity, the previous court had held. The CJEU held that AA’s operations were effectively continuing through TAP and identity had been retained. TUPE applied.

The transfer of tangible assets is a key factor in determining whether there has been a transfer of a business like AA. It was relevant here that TAP had taken over AA’s leases and used AA’s aircraft – these were essential to pursuing the activities that AA had previously carried on. The fact that TAP had taken over AA’s charter flight contracts indicated that it was dealing with AA’s customers. TAP had also taken on AA staff. And, the three-month gap between AA being wound up and TAP operating some of the charter flight business, meant that there was hardly any suspension of the activities.

Always a tricky area to deal with and, although we’ve got some broad rules, it’s one that will only ever be decided on the facts.

Sick employees and TUPE

BT Managed Services v Edwards

In another TUPE case, the issue was about who does and who doesn’t transfer. In particular, is a long-term sick employee who isn’t working “assigned immediately before the transfer” so that their employment transfers under TUPE?

Mr Edwards was considered to be permanently sick. There were no prospects of him returning to work but BT had kept his employment going so that he could benefit from a PHI scheme and, once that had come to an end, similar payments from BT.

There was a service provision change. The new service provider went on to claim that Mr Edwards had not transferred to become its employee. The tribunal agreed. It held that Mr Edwards was not assigned to the organised grouping because he did not contribute to its economic activity.

The Employment Appeal Tribunal upheld that decision. Mr Edwards wasn’t participating (and wasn’t expected to participate) in the activities carried out by the group. An employee who had no connection with the economic activity of the grouping and would never have one in the future could not be regarded as being assigned to that grouping. Mere administrative connection isn’t enough; there needs to be some participation in the group’s economic activity.

Treat this decision with some caution, whether you are the transferor or transferee. It doesn’t mean that no long-term sick employees will transfer under TUPE. Think about the prospect of the employee returning to work. Think, too, about their contribution to economic activity. Both are crucial factors in determining whether or not they’ll transfer.    

And finally…..

“Will this go to you, and only to you?”

It’s a question many of us now ask before tapping our PIN into a waiter or waitress’s card machine. And it’s not a daft question, especially since one pizza restaurant chain’s reported practice of taking a slice of tips paid by debit and credit cards was publicised.

The Government is now looking at how tips work in practice. It’s calling for evidence on how employers pass on tips, gratuities, service changes and cover to employees. The Government wants to know how it can ensure greater transparency and limit the amount an employer can keep.

If you’re interested in taking part, get your responses in by 10 November 2015.