1. Employment Law in a Nutshell
Elizabeth Delafosse
Millbank Solicitors
Farringdon Road
London
EC1R 3BW
Millbank Solicitors (SRA ) – April 2012

2. Millbank Solicitors (SRA 349339) – April 2012
What is Employment Law?
Law that governs the workplace – ERA 1996 – Equality Act 2010
Offers protection for employees, workers and agents
It covers recruitment, promotion, dismissals, staff management, disciplinary action, and grievance complaints
Millbank Solicitors (SRA ) – April 2012

3. Millbank Solicitors (SRA 349339) – April 2012
What is my status?
Employee or worker?
Employee: “An individual who has entered into or works under a contract of employment”
Contract = contract of service or apprenticeship (express or implied)
Millbank Solicitors (SRA ) – April 2012

4. Millbank Solicitors (SRA 349339) – April 2012
Worker status
Worker: a person who is either
an employee working under a contract of employment;
or working under a contract offering a personal service in return for remuneration
Self employed contractors/freelances/ subcontractors/casual workers who are in a subordinate and dependent position = workers
Millbank Solicitors (SRA ) – April 2012

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Worker
Those who are self employed and are in business to provide a client or customer with professional or other services are not workers
(ie: Consultant running a consultancy practice)
Millbank Solicitors (SRA ) – April 2012

6. Employee Statutory Rights
Main Statutory rights:
Continuity of employment on transfer of undertaking
Equality for fixed term employees
Guarantee payments
Itemised pay statements
Maternity, adoption, paternity and parental rights
Minimum period notice
Not to suffer unlawful deductions
Redundancy rights
Request flexible work
Sick pay
Unfair dismissal & written statement of reasons for dismissal
Written statement of main terms
Millbank Solicitors (SRA ) – April 2012

7. Worker Statutory Rights
Main statutory rights:
Break and rest periods
Equal pay
Equality for part time workers
Health and safety rights
National minimum wage
Not to be discriminated against
Paid annual leave
Right not to suffer detriment for inadmissible reason
Right to be accompanied at discipline and grievance hearings
Trade union activities
Whistleblowing rights
Millbank Solicitors (SRA ) – April 2012

8. Part time and Fixed Term
Employers must ensure that part-time workers or fixed term workers are not treated less favourably than full-time or permanent staff
Fixed term employees become permanent employees if they have served under successive fixed term contracts (exception of apprentices and students on work experience)
Millbank Solicitors (SRA ) – April 2012

9. Employee or Self Employed?
Important for Employment and Tax Law purposes
Self Employed: pay less National Insurance Contributions
Employees: have more statutory rights and will often have more contractual benefits (eg: contractual sick pay etc)
Sometimes difficulty in distinguishing – look for mutuality of obligation, sufficient control and work carried out personally
Millbank Solicitors (SRA ) – April 2012

10. Volunteers and Interns
The legal status of volunteers and interns is not clear cut
Whether they acquire rights depends on the relationship between the parties
Case law starting to develop re: potential entitlement to national minimum wage
Volunteers only entitled to NMW if ‘workers’
Millbank Solicitors (SRA ) – April 2012

11. Volunteers and Interns
Avoiding the risks of creating legally binding contracts with volunteers:
Avoid making payments to volunteers that could be construed as wages – ensure that it is expenses only
Remove/minimise perks that could be considered “consideration”
Reduce obligations on part of volunteer – give volunteer the ability to refuse tasks & choose when to work
Avoid using language that sounds “contractual” – “usual”/ “suggested”
Treat volunteers fairly
Millbank Solicitors (SRA ) – April 2012

12. What rights do employees have?
Contractual rights
Statutory rights
Common law (case law)
Rights accrue from recruitment stage (protected rights) through to dismissal
Gradually accrue more rights the longer the length of service
One year – protection from unfair dismissal
Two years – right to statutory redundancy pay
Probationary period – important to address issues as early as you can
Millbank Solicitors (SRA ) – April 2012

13. Why is status important?
Employees have a number of rights – if not respected – could lead to tribunal claims
Every year thousands of cases are presented in employment tribunals – why and how??
Leads to great expense in terms of time and money for employers
Many can be avoided by a little common sense and some good management......
Millbank Solicitors (SRA ) – April 2012

14. Millbank Solicitors (SRA 349339) – April 2012
The Contract
Employment Rights Act states must have a contract or S.1 Statement within 2 months of commencing employment
Copy of handbook
Told where to access policies (ie: health and safety, grievance, disciplinary, etc) and pro forma forms (ie: expenses form)
Millbank Solicitors (SRA ) – April 2012

15. Millbank Solicitors (SRA 349339) – April 2012
The Handbook
Non – contractual document
Sets out what is expected of employees and also what they are entitled to expect in terms of leave, sickness and how a grievance and disciplinary procedure will take place
Acts as a guide for managers so they know how to conduct a disciplinary or grievance procedure
Needs to be used and referred to regularly – encourage employees to use it
Millbank Solicitors (SRA ) – April 2012

16. Disciplinary Procedure – how it works
Case example – Misconduct
Brian has been working in the finance department for 10 years.
He has a clean disciplinary record, but due to some personal problems he has been behaving erratically lately.
Last week one of his female colleagues, Sophie, caught him looking at inappropriate websites and reported the matter to her line manager.
What are the issues?
What would you do if you were the line manager?
If you do nothing what could happen?
Millbank Solicitors (SRA ) – April 2012

17. Applying the handbook to the case
Step One: Considering suspension (contract) and investigating NB: Confidentiality is key!
There could be a simple explanation and the presumption of innocence should be retained.
Talk to Sophie, ask her to write a short statement of what she saw, what was said, if there were any other witnesses – remember to write down the dates, times etc... These details will be important later on. Ask her what she considers appropriate
Speak to IT – obtain the records of websites viewed that day by Brian, length of time on websites etc
Investigating officer should write a report of his/her findings and decide whether there are grounds for disciplinary action
Millbank Solicitors (SRA ) – April 2012

18. Investigation – what happened?
As part of his investigation, Brian’s line manager spoke to Sophie, she appeared very distressed by what she saw and said she will find it very hard, if not impossible to work with Brian again
The IT manager provided a list of websites accessed by Brian which included a number of “adult” sites which were viewed for over two hours in total that day
Millbank Solicitors (SRA ) – April 2012

19. Millbank Solicitors (SRA 349339) – April 2012
At the hearing....
An appropriate manager will conduct the hearing
Decide who is appropriate
Investigating officer should be there
Notetaker should be there (warn him/her about confidentiality)
A colleague or TU rep may be present with Brian – can ask questions but cannot answer questions on his behalf
Go through allegations
Full note should be taken
Adjourn hearing if further investigation is needed
Millbank Solicitors (SRA ) – April 2012

20. Millbank Solicitors (SRA 349339) – April 2012
After the hearing
Confirm that a decision will be made as soon as possible and communicated to him
Notes of the meeting will be sent to him in the post
Person conducting hearing should go away and consider the evidence he/she heard and Brian’s version of events and any mitigating circumstances
The decision should be sent to him in writing and he must be offered the right to appeal if a disciplinary action is taken
Millbank Solicitors (SRA ) – April 2012

21. Millbank Solicitors (SRA 349339) – April 2012
Brian’s case...
In the meeting Brian admitted that he had looked at the adult websites but said that he has a lot of personal stress at the moment, his wife has asked for a divorce and he believes he is having a midlife crisis. He is seeking medical advice
Sophie has since threatened to leave if she has to work with him
Given the extenuating personal circumstances and Brian’s good personnel record, the line manager decides that the most appropriate action is to issue him with a final written warning, and move him to another department which will involve a demotion of one level
Millbank Solicitors (SRA ) – April 2012

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The Appeal
Brian has the right to appeal against the outcome of the disciplinary hearing
An appeal hearing should take place as quickly as possible and by someone more “senior” than the person who carried out the initial disciplinary procedure (probably the MD). Again Brian has the right to be accompanied
They will look at the documents, any new information that has come to light (ie: anything stated in Brian’s grounds to appeal letter) and conduct the appeal hearing
Final decision should be communicated to Brian by letter as soon as it has been made – no further right of appeal!
Millbank Solicitors (SRA ) – April 2012

23. Problems if not handled properly....
In the Brian situation Sophie could raise a grievance against the Company and Brian personally
Issues of vicarious liability – office parties etc
Breach of contract – if suspend him without having the right to do so
Breach of statutory rights – if not offered right of companion
Breach of natural justice and unfair dismissal if not investigated properly and decided to dismiss him
Millbank Solicitors (SRA ) – April 2012

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Grievance Procedure
What is a grievance?
Written complaint, sent by the employee to his/her line manager
Examples....
Bullying, harassment, discrimination
Complaint about colleague
Millbank Solicitors (SRA ) – April 2012

25. Millbank Solicitors (SRA 349339) – April 2012
Why should I care?
Grievances can quickly go out of control
If it becomes a tribunal claim you may be a witness
Expensive, time consuming and your actual job will suffer as a result
Example of an ‘out of control’ grievance
Millbank Solicitors (SRA ) – April 2012

26. Millbank Solicitors (SRA 349339) – April 2012
Grievance Procedure
If an employee raises an issue – try to defuse it as quickly as possible
Informal chat, appear to care but do not necessary agree with what they say
Reasonableness is key
If they wish to take it further they need to follow the procedure in the handbook
Millbank Solicitors (SRA ) – April 2012

27. Millbank Solicitors (SRA 349339) – April 2012
Grievance Procedure
Similar to disciplinary procedure
Step one – investigate the grievance
Step two – grievance meeting (can be accompanied)
Step three – Letter setting out outcome
Step four – appeal
Communication is important – find out what the employee wants – sometimes it’s as simple as an acknowledgment
Will ascertain their ‘motivation’ by speaking to them
Millbank Solicitors (SRA ) – April 2012

28. General Employment Issues
Always behave fairly and reasonably
No set rules in the employment tribunals
Communication is vital
Silence leads to bad feeling and aggravates the situation
Make a note of everything
Attendance notes, s etc
Set up sub-folders for each of your staff in your inbox
Treat every one of your employees the same
Act promptly to any issues
Millbank Solicitors (SRA ) – April 2012

29. Tax and National Insurance Contributions
Employees are taxed at source via the PAYE system – Employer takes income tax and NI on behalf of employee
Self employed – responsible for own payment of tax – assessed via self assessment form
Personal Allowance for tax year 2012/13 is £8,105
NI contributions – standard rate in most cases 12% on monthly earnings between £633-£3540
Millbank Solicitors (SRA ) – April 2012

30. Millbank Solicitors (SRA 349339) – April 2012
Tax Rates
Rate
Basic rate: 20%
£0-£34,370
Higher rate: 40%
£34,371-£150,000
Additional rate: 50%
Over £150,000
Millbank Solicitors (SRA ) – April 2012

31. Millbank Solicitors (SRA 349339) – April 2012
Pensions
Employers who have 5 or more employees must provide access to a designated stakeholder pension
From October 2012, phased over 4 years, employers will be obliged to automatically enrol all their eligible employees into a contributory pension scheme
Millbank Solicitors (SRA ) – April 2012

32. Millbank Solicitors (SRA 349339) – April 2012
Overlapping Matters
Non- Employment matters that need to be considered
Health and safety (personal injury claims)
Keep a record of all accidents
Carry out “risk assessments” regularly and in particular when an employee announces she is pregnant or hurts themselves at work
Immigration
Copy of the passport/visa of each employee on file when they join – avoid discrimination issues
£10,000 fine for each illegal worker if you did not know
2 year prison sentence if knowingly employed illegal worker
Millbank Solicitors (SRA ) – April 2012