Top tips when reviewing employment contracts
Employment contracts are the building blocks of the employment relationship. However, they are often not given the care or attention they deserve. Even if a full review of your contracts is a step too far it is worth giving them a regular health check. Here are our tips for some key areas to focus on:
- Do you have a signed contract on file for each employee? It would be difficult to hold an employee to terms contained in a document which you do not have any evidence of them agreeing to.
- Do your contracts comply with the requirements for written terms set out in section 1 Employment Rights Act 1996? These cover all the obvious areas such as pay, hours of work, place of work and holidays as well as less obvious areas such as trade union recognition and working outside the UK. More recently, they have been updated to also require the inclusion of details of training provision and paid leave.
- Do your contracts work for your business? Different businesses will have different areas of focus. For example, businesses with sales employees will want to consider including restrictive covenants to control the ability of leavers to take customers with them when they leave. Businesses with fluctuating demand will want to consider adding an express clause allowing them to place employees on short-time working or lay them off.
- Do your contracts give you control in key areas? Look for terms requiring employees to return company property; a right to suspend employees; a right to monitor employees and a right to deduct from wages for monies owed by the employee.
The employee would usually need to expressly agree to any changes you decided you needed to make and sometimes financial consideration may be appropriate.
How to judge whether misconduct ‘arises from a disability’
Employees have a right not to be treated unfavourably by their employer because of something arising from a disability (unless the treatment can be justified). It is often the knock-on effect of a person’s disability which leads to problems in employment rather than the disability itself.
Where an employee has a mental impairment, it is not always easy for an employer to know what behaviour ‘arises from’ a disability and what behaviour is just poor behaviour. In McQueen v The General Optical Council, Mr McQueen had various neurodiverse impairments. He was disciplined for a pattern of aggressive behaviour at work.
He brought a claim alleging that he had been treated unfavourably for this aggressive behaviour, which he claimed arose from his disabilities. The medical evidence stated that his disabilities meant that he was more likely to lose control when stressed. Despite this, the Employment Tribunal decided that the aggressive behaviour was not something which arose from his disabilities at all. The Employment Appeal Tribunal agreed that this assessment could stand.
They noted that the test of whether behaviour ‘arises from’ a disability is a wide one and does not require the disability to be the sole or main reason for the behaviour. They found that there was no need for the ET to assess multiple factors contributing to the behaviour in this case as they had concluded that the disabilities had no impact on the behaviour – so did not ‘arise’ from them at all.
This case, as with all cases looking at discrimination arising from a disability, is very fact specific but there are some useful points that can be taken away:
- You do not have to accept your employee’s self-assessment of their impairment and what arises from it. Obtaining occupational health support will give you a more objective view.
- A disability does not have to be the only reason for the behaviour in order for the behaviour to ‘arise’ from it. The ET’s conclusion that the disabilities had no impact on Mr McQueen’s behaviour was a bold one. It is wise to exercise caution where the position is not clear.
- Employers will not be liable even if they do treat an employee unfavourably for a reason arising from their disability, provided that they can justify their actions.
Rate increases
The Government has announced the employment law rate changes that come into force in April 2023.
From 1 April 2023:
- National Living Wage for workers aged 23 and over increased to £10.42 per hour
- For workers aged 21-22 the rate increased to £10.18 per hour
- For workers aged 18-20 the rate increased to £7.49 per hour
- For workers aged 16-17 and those on apprenticeships the rate increased to £5.28 per hour
From 2 April 2023 Statutory Maternity Pay, Statutory Paternity Pay, Shared Parental Pay, Statutory Parental Bereavement Pay and Statutory Adoption Pay all rose to a maximum of £172.48 per week.
From 6 April 2023:
- Statutory Sick Pay increases to £109.40 per week
- A week’s pay for statutory redundancy pay (and basic award for unfair dismissal) purposes rises to a maximum of £643.
For Employment Tribunal claims for discrimination presented on or after 6 April 2023, the Vento bands which the ET uses to assess the level of compensation for injury to feelings in discrimination cases increase to:
- a lower band of £1,100 to £11,200 (less serious cases);
- a middle band of £11,200 to £33,700 (cases that do not merit an award in the upper band); and,
- an upper band of £33,700 to £56,200 (the most serious cases), with the most exceptional cases capable of exceeding £56,200.
Reflections on the 4 day working week trial
Data from the UK’s large-scale 4 day working week trial was published in February 2023. The data emerged from a 6 month trial involving over 60 businesses of varying sizes across a wide-range of industries. Each business involved moved its employees to a 4 day working week whilst maintaining salaries at a 5 day level.
The headline results showed that 30% of the businesses who completed the trial intended to keep the arrangement permanently. There was some evidence that productivity and output increased. The trial had a positive impact on employee engagement. However, its impact varied widely from business to business. Participants in warehousing and manufacturing businesses struggled to keep up with demand. Customer-facing businesses (like call centres) also encountered issues with service levels with some needing to recruit additional headcount (at additional cost) to make sure that service levels did not drop.
The outcome of this trial indicates that, much like the shift to homeworking caused by the pandemic, a reduced working week is easier for some types of business to accommodate than others.
Spring 2023 Budget: Get back to work!
There was a definite theme running through the employment proposals announced in the Spring 2023 Budget: ‘get back to work’! This was approached from various angles but one of the key announcements was the proposed introduction of ‘returnerships’ (later life accelerated apprenticeships) for those over 50 returning to the workplace following a break.
The impact of this on employers is largely indirect and hopefully positive. A larger prospective workforce means a larger and more diverse pool of potential candidates for roles. As a society we are living longer and UK productivity relies on using talents of all ages and re-engaging and potentially re-training those who may have already had a ‘first career’. Personnel Today reports that the over 50s are the fastest growing demographic in the UK – numbering 27.9 million people by 2030.
There are factors that will need to be considered. For example, what rate of pay will those on ‘returnerships’ be entitled to? Will they be treated in the same way as other apprentices? Employers will also need to consider specific needs and priorities of those returning to work over the age of 50. They might favour flexible working or job-sharing so you may face an increase in flexible working applications. There could also be an increased need for occupational health support if those returning have age-related health issues. An employer’s obligation not to discriminate on grounds of age, sex or disability will apply in the context of returnerships just as it does to other areas of employment.
Communicating dismissal in ‘without prejudice’ correspondence
You might think that it would be tricky for an employer to dismiss an employee without meaning to. A recent Employment Appeal Tribunal decision highlights the importance of careful drafting when making offers of settlement.
In Meaker v Cyxtera Technology UK, Mr Meaker’s employer sent him a letter on 5 February 2020 which was marked ‘without prejudice’. The letter said there would be a mutual termination of Mr Meaker’s employment on 7 February 2020. No agreement had actually been reached with Mr Meaker. The letter went on to make an offer of an additional payment to the employee if he signed a settlement agreement. Mr Meaker did not sign the settlement agreement. The Employment Tribunal found that Mr Meaker’s employment terminated on 7 February 2020. The EAT agreed. The additional payment was dependent on him signing a settlement agreement but the dismissal was not.
This case is a reminder of the need for careful drafting when making offers of settlement. If the full offer (including termination of employment) had been stated to be conditional on the signing of a settlement agreement then, if the offer had not been taken up, the employee would have remained employed and the employer would still have had the chance to deal with dismissal openly (and fairly).
Less favourable treatment of part-time workers
It is unusual for a group of judges to complain about their pay but the recent case of Ministry of Justice v Dodds is an exception. Part-time workers have a right not to be treated less favourably than comparable full-time ones. The judges in this case claimed that when, on occasion, they had to work in higher courts, they were part-time workers in the higher position and should be paid at the same rate as full-time judges in the higher role. This argument was successful in the Employment Tribunal but the Employment Appeal Tribunal did not agree.
The EAT did not think that the judges were part-time workers in the higher roles which they were asked to ‘sit-up’ in. It followed that they could not claim less favourable treatment as part-time workers and compare their rate of pay whilst ‘sitting up’ with that of permanent full-time judges in the higher court. The EAT said that acting-up in a higher court on occasion was not a different employment which could be looked at separately from their main role. It was just part of their job.
If a different decision had been reached this could have had far-reaching consequences for all employers with employees whose role may, on occasion, involve them working in a higher (and better paid) position. Employers would be faced with either having to increase pay rates every time they temporarily took on some more senior duties or avoid the possibility of them having to act-up at all. Luckily ‘justice’ appears to have been done in this case!
Ramadan – considerations for employers
The Muslim holy month of Ramadan began on 22 March and will end 29 or 30 days later. During Ramadan, healthy adult Muslims observe a fast between dawn and dusk. Exceptions are made for those who are pregnant, menstruating or in poor health.
There is no automatic right to time off for religious observances. Subject to any agreement you might reach with your staff they would be expected to come to work as usual during Ramadan (and, indeed, during Eid al-Fitr which follows it).
There are several points which employers should consider when looking to support Muslim employees during Ramadan:
- Awareness is important. You should make sure that all employees are aware of the timing of Ramadan and that discrimination or harassment on grounds of religion will not be tolerated.
- You have an obligation to support the wellbeing of your employees. Consider what adjustments you might be able to put in place to help your employees with the impact of fasting. For example, you could replace a lunch hour with several smaller breaks and could avoid scheduling long meetings where concentration might be an issue.
- Do not assume that all Muslim employees will need adjustments or, indeed, that they will be observing Ramadan. There are specific exceptions for menstruation, pregnancy and ill health. Muslim employees who are not observing Ramadan for one of these reasons may not wish to discuss such personal issues or have attention brought to them.
- You should consider the appropriateness of holding social events focused on eating or drinking. You want to make sure that employees do not feel excluded.
Disclaimer: This post is for information purposes only. Reasonable steps have been taken to provide accurate information, but no responsibility is taken by the author (Hunter Law Ltd) for any consequences arising from its usage.
This post is not intended to and does not constitute legal advice and you should instruct a solicitor formally should you require this.
