Coronavirus Job Retention Scheme update
The Government has published a number of versions of its guidance for employers and employees on the Coronavirus Job Retention Scheme (‘CJRS’), separate guidance on employees taking annual leave and, most recently at the time of writing, a second version of the Treasury Direction for the CJRS.
Due to the changing nature of the guidance issued by the Government, it’s imperative that employers take advice from a reputable source on CJRS-related matters.
Recent changes include:
- An extension to the CJRS to the end of October 2020. At the time of writing, the only information we have available is that until the end of July, there will be no changes. From August to October 2020, the scheme will continue on the basis that furloughed employees can be brought back part-time.
- Employers can compel employees to take annual leave during furlough leave. However, the guidance does state that ‘the employer should consider whether any restrictions the worker is under, such as the need to socially distance or self-isolate, would prevent the worker from resting, relaxing and enjoying leisure time, which is the fundamental purpose of a holiday.’
- Agreements issued by employers to employees amending their terms and conditions of employment such that they are placed on furlough leave must be retained by the employer until 30 June 2025.
- Where Statutory Sick Pay (’SSP’) is in payment or due to be paid, furlough cannot begin until immediately after the end of the ‘period of incapacity for work’ for which the SSP is being paid or due to be paid. The guidance goes on to suggest that the timing of the end of the period of incapacity should be determined by agreement between the employer and employee.
- The recently introduced regulations in relation to sick pay and coronavirus have been extended to people who have been told to isolate under the new ‘test and trace’ system. A person who has been notified that they have had contact with a person with coronavirus, and who is self-isolating for 14 days due to this, will be entitled to statutory sick pay.
Coronavirus-related reorganisation and redundancy
Despite the support offered to employers by the UK government under the Coronavirus Job Retention Scheme, some employers will unfortunately and unavoidably have a need to make redundancies/reorganise their workforce in order to make savings and/or due to a reduction of available work.
Irrespective of the exceptional circumstances, employers will still need to ensure that they comply with employment law in terms of consulting with employees, the fairness of any dismissals and that any decisions made to make employees redundant and/or change their terms and conditions of employment are not done so on the basis of discriminatory criteria.
Employment law requires employers to consult with affected employees and, where an employer is proposing to dismiss 20 or more employees in a 90 day period or less (even if those proposed dismissals relate solely to making changes to terms and conditions of employment), it must collectively consult with elected employee representatives for the relevant minimum period and also provide the required notification to the government.
When selecting employees for redundancy or appointment to alternative positions (whether by way of selection criteria or an interview process), employers need to ensure that they use criteria that are not directly or indirectly discriminatory on the grounds of any of the characteristics protected under the Equality Act 2010 (age, sex, race etc.) and that any criteria used is applied fairly.
. . . and in other news . . .
Equal Pay – 50 years on
The Equal Pay Act 1970 (‘the Act’) received Royal Assent on 29 May 1970 and came into force five years later. It was subsequently repealed and replaced by the Equality Act 2010. The Act established the legal principle that workers should receive equal pay for equal work and arose out of a strike by women at Ford’s Dagenham plant. The strike was called in 1968 by female workers who were disgruntled about a pay structure that favoured male workers. Their action led to a meeting between strike leaders and the employment secretary who brokered a deal that included the conception of the new act.
The statistics reported by the Office of National Statistics show that the gender pay gap is declining slowly and that the gap in average pay for men and women working full-time stands at 13.1%. The gap does however vary across age brackets and occupations. Despite this decline, the Ministry of Justice’s Employment Tribunal statistics report an annual average of 29,000 equal pay claims since the financial year 2007/08, constituting 12% of all Employment Tribunal complaints. This doesn’t take into account cases that do not proceed to a hearing due to strike out, settlement etc. The statistics suggest that, despite the passing of 50 years, there is still some work for employers to do on reducing the gender pay gap and achieving the pay equality that was intended when the Act was passed.
Changing Terms and Conditions under TUPE
In the case of Ferguson and Ors v Astrea Asset Management Limited, the Employment Appeal Tribunal (‘EAT’) held that contract variations made by a transferor by reason of a TUPE transfer, that are beneficial to the employee, are void.
TUPE protects the employment, and terms and conditions of employment, of employees in cases where there is a transfer of an undertaking (or, in this case, a change to the provider of a service). The claimants were directors of a company. The company lost an estate management contract and, prior to the loss of the contract, the directors varied their own contracts to give themselves more generous terms in relation to bonuses and termination payments. When the new contract provider discovered this, it refused to allow some of the claimants to transfer and dismissed the others for gross misconduct. The EAT held that, even though the changes were beneficial to the employees, they were void because they had been made by reason of the TUPE transfer. The EAT reduced the claimant’s compensation by 100% due to his involvement in making the variations and the fact that his misconduct was sufficient to justify dismissal.
It might still be possible for a transferee (the new contract provider) to agree on changes that are beneficial to an employee after a transfer has taken place.
Continuity of employment
In the Employment Appeal Tribunal (‘EAT’) case of Mr R O’Sullivan v DSM Demolition Limited, the EAT held that unofficial work carried out prior to a formal start date did not count towards a period of continuous employment.
Mr O’Sullivan needed to have two years’ continuous service in his employment to bring a claim for unfair dismissal against his employer, DSM Demolition Limited (‘DSM’). DSM maintained that his start date was 2 November 2015 and Mr O’Sullivan claimed it was 26 October 2015. Mr O’Sullivan had carried out work on-site during the week of 26 October 2015 and that he was paid £100 cash in hand for that week. His terms and conditions of employment stipulated a start date of 2 November 2015 and he was not put on the payroll until that date. The EAT held that the employment tribunal had been entitled to conclude that the work carried out in the week of 26 October 2015 was an unofficial arrangement and not under a contract of employment.
However, employers should exercise caution when calculating the length of service of employees who have been required or permitted to carry out work prior to their official start date as whether or not that work amounted to ‘employment’ will be very fact-specific.
A reminder of April’s Employment Law changes
Due to all focus having been on coronavirus-related matters over the past two months, April’s employment law changes may have passed employers by so here is a reminder of those changes…..
- Employees will be entitled to a written statement of terms from day one of employment
Prior to 6 April 2020, under section 1 of the Employment Rights Act 1996 (‘ERA’), employees had to be provided with a statement of written terms of employment within two months of commencing employment. A statement of written terms is essentially a short version of an employment contract. From 6 April 2020 onwards, all employees and workers have the right to a written statement of particulars from their first day of employment, rather than after two months.
Section 230(3), ERA defines a ‘worker’ as an individual who has entered into or works under (a) a contract of employment; or (b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual.
Previously, employers had to provide employees with the following in writing within two months of starting:
- The names of the employer and employee.
- The date the employment starts and the date the employee’s period of continuous employment began.
- Pay (or method of calculating it) and interval of payment.
- Hours of work, including normal working hours.
- Holiday entitlement and holiday pay.
- The employee’s job title or a brief description of the work.
- Place of work.
- A person to whom the employee can appeal if they are dissatisfied with any disciplinary decision relating to them or any decision to dismiss them.
- A person to whom the employee can apply for the purpose of seeking redress of any grievance relating to the employment and the manner in which any such application should be made.
(Section 2(4) and section 3(1)(b), ERA)
In accordance with The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 (SI 2018/1378) additional information now has to be included from day one of employment (unless stated otherwise) as follows:
- Normal working hours, including the times of the week when the employee/worker is required to work, whether these hours or days may be variable and, if so, how they may vary.
- Any benefits other than pay that the employee/worker is entitled to, including non-monetary benefits such as vouchers or meals.
- Any probationary period, including the duration and any conditions.
- Sick pay entitlement.
- Details of any other paid leave such as maternity leave and paternity leave.
- Any training to be provided and details of any mandatory training that the employee/worker must complete (within two months of starting)
- The notice periods for termination by either side.
- Terms as to length of temporary or fixed-term work.
- Terms related to work outside the UK for a period of more than one month.
- Terms as to pensions and pension schemes. (within two months of starting).
- Details of any collective agreements directly affecting the employment.
The changes only apply to new employees/workers engaged on or after 6 April 2020 although similar requirements apply to employees/workers whose particulars of employment change on or after that date.
- National Living/Minimum Wage Increase
NLW/ NMW: From 1 April 2020:
- The NLW for workers aged 25 and over increased from £8.21 to £8.72 per hour.
- The NMW for 21- to 24-year-olds increased from £7.70 to £8.20 per hour.
- The NMW for 18- to 20-year-olds increased from £6.15 to £6.45 per hour.
- The NMW for 16- to 17-year-olds increased from £4.35 to £4.55 per hour.
- The apprentice rate for those aged under 19 or in the first year of an apprenticeship increased from £3.90 to £4.15 per hour.
Family Rates: From 5 April 2020
The following rates applied from April 2020:
- The weekly rate of statutory sick pay (SSP) is £95.85 (up from £94.25).
- The weekly rate of statutory maternity pay (SMP) and maternity allowance is £151.20 (up from £148.68).
- The weekly rate of statutory paternity pay (SPP) is £151.20 (up from £148.68).
- The weekly rate of statutory shared parental pay (ShPP) is £151.20 (up from £148.68).
- The weekly rate of statutory adoption pay (SAP) is £151.20 (up from £148.68).
For more information, please contact Tom Evans: tom.evans@dtmlegal.com/ 0151 230 1217 or Elizabeth Judson on 0151 556 1125
