Articles | Employment bulletin July 2015

STOP PRESS!  Government announces new National Living Wage.  We also look at the impact of voluntary overtime on holiday pay and whether employees must report alleged misconduct.

 

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David Clay

David Clay

National Living Wage

Government announces new compulsory rate of pay

National Living Wage

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The government has announced a new National Living Wage to apply from April 2016.  The National Living Wage prescribes a minimum rate of pay for all workers aged 25 or over.  The National Living Wage will initially be £7.20 per hour and is expected to rise to at least £9.00 per hour by 2020.

With the National Minimum Wage due to increase to £6.70 in October 2015, employers must now budget for another increase of 50p per hour for the majority of their workforce just six months later.  The financial impact of the National Living Wage may be partially offset by cuts in the rate of corporation tax and an increase in the National Insurance contributions (NICs) Employment Allowance from £2,000 to £3,000.

Holiday Pay (Again)

Does voluntary overtime need to be included as well?

Holiday Pay (Again)

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The long-running saga of holiday pay cases continues unabated.  In November 2014 we reported on a series of cases heard by the Employment Appeal Tribunal (EAT) which confirmed that holiday pay should take into account not only overtime that is guaranteed, but also any overtime that an employee is obliged to carry out.  Now the Northern Ireland Court of Appeal (NI Court) has turned its attention to voluntary overtime, i.e. where an employer is not obliged to provide overtime and the employee is not obliged to work it if offered.  The case concerned Mr Patterson, who regularly worked voluntary overtime for which he was paid at time and a half.  However, his holiday pay was calculated on the basis of his basic salary only.

In the view of the NI Court, there was no reason why voluntary overtime could not, in principle, be included in statutory holiday pay.  The NI Court felt that the key question was whether the voluntary overtime was sufficiently permanent to form part of Mr Patterson’s normal remuneration.

Decisions of the NI Court are not binding in England and Wales, but may be taken into account.  Employers accordingly need to be aware that if an employee regularly works overtime, even on a purely voluntary basis, this may need to be factored in when calculating holiday pay.  Employers who rely heavily on voluntary overtime should assess their potential liabilities and consider whether they need to amend their working practices and contracts of employment.



Allegations of misconduct

Do employees have a right to stay silent?

Allegations of misconduct

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To effect a fair misconduct dismissal, an employer must be able to demonstrate that its decision to dismiss was reasonable in all the circumstances.  A recent case before the Employment Appeal Tribunal (EAT) considered whether this requirement was satisfied when an employee was dismissed for failing to disclose allegations made against him.

The case involved Mr Amadi, who worked part-time as a Cover Supervisor at Basildon Academies.  In breach of an express term in his contract, Mr Amadi failed to inform the Academy that he had taken on a second job at Richmond upon Thames College.  While working at Richmond, Mr Amadi was accused of sexual assault by a female pupil.  Following a police investigation, Mr Amadi was not prosecuted. However, when the Academy learned of the allegations (via the police) it suspended Mr Amadi and subsequently dismissed him.  In the Academy’s view, Mr Amadi’s failure to inform it about both his second job and the allegation of sexual assault were each instances of gross misconduct.  Mr Amadi brought a claim for unfair dismissal.

The EAT reviewed Mr Amadi’s terms of employment and concluded that there was no express or implied contractual term requiring Mr Amadi to disclose the alleged misconduct.  While employees could be under an implied duty to disclose their own misconduct in certain circumstances, it was not the case that an employee must disclose (in the absence of an express contractual term) any allegation, however ill-founded.

The dismissal of Mr Amadi was accordingly deemed unfair, although his compensation was reduced by 30 per cent due to his contributory conduct in failing to inform the Academy about his second job.

The EAT’s decision demonstrates that employers who want the flexibility to take disciplinary action on the basis of failure to report alleged misconduct must adopt precise contractual wording and make specific reference to the reporting of allegations within their disciplinary policies.  This may be especially important for those employers who work in the education sector or have responsibilities for safeguarding children or vulnerable adults.

Is travelling time working time?

Workers on the move may need more rest breaks

Is travelling time working time?

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Under the Working Time Regulations, workers are entitled to receive a rest break of 20 minutes where their working day exceeds six hours and a break of 11 hours between one working day and the next.  There is also a limit of 48 hours on the average working week (unless the worker has agreed to opt out).  For employers, knowing what counts as working time is essential to providing the required periods of rest.

A case currently before the European Court of Justice (ECJ) has raised the issue of whether travelling time should count as working time for calculating rest breaks.  The case concerns a group of technicians who have no fixed place of work and spend each day driving to different customer sites to install and maintain equipment.  Their employer calculates their working day as starting at their arrival at their first customer site and ending at their departure from their last customer site.  The workers argue that their working time should include the time spent travelling to and from their homes to their first and last assignments.

The Advocate General (AG) has given his opinion on the case and concluded that the time spent by the workers travelling to and from their homes should count as working time.  This was on the basis that travelling was an integral part of peripatetic workers’ duties and essential for them to provide their services.  The workers were also at their employer’s disposal during this time, as their employer dictated the start and end points of the working day and could add in new appointments or swap the order of site visits.

The AG’s opinion is not binding on the ECJ, but if the ECJ agrees then UK employers with travelling workers must review their shift patterns and allocated breaks to avoid a breach of the Working Time Regulations.  Employers may also need to consider the use of tracking or monitoring if they are concerned about workers falsifying time sheets or using travel time to run personal errands.

Expressing an opinion in the workplace

What’s acceptable?

Expressing an opinion

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An employer may face a claim for direct discrimination where it treats an employee less favourably than it treats or would treat others because of that employee’s religious beliefs.  However, where religious beliefs appear to infringe upon the rights of other workers, employers can be left in a difficult position.  An Employment Tribunal has recently looked at an employer’s response to a Christian employee’s interactions with a lesbian colleague (LP).

Ms Mbuyi, a Christian nursery assistant, worked at Newpark Childcare alongside LP.  During a conversation, LP asked what Ms Mbuyi believed God thought of her living arrangements.  Ms Mbuyi told her that “God is not okay with what you do”, but added “we are all sinners”.  Although LP did not make a formal complaint, Ms Mbuyi was subsequently invited to a disciplinary hearing.  During the hearing it also emerged that Ms Mbuyi had previously given LP a bible as a gift after LP had been hospitalised.  The bible included a handwritten note referring to LP’s “struggle”.  Newpark concluded that Ms Mbuyi had harassed LP and dismissed her for gross misconduct.  Ms Mbuyi brought claims for direct and indirect discrimination.

The Tribunal upheld Ms Mbuyi’s discrimination claims, finding that she had suffered discrimination because of her belief that homosexuality is a sin.  The Tribunal emphasised that Ms Mbuyi had not initiated any conversation about religion in contravention of Newpark’s policies.  It also heavily criticised the disciplinary process followed by Newpark, citing a catalogue of procedural failings and characterising its approach as construing almost anything said or done by Ms Mbuyi as targeting LP because of her sexuality, despite there being little or no supporting evidence.  The Tribunal could only understand Ms Mbuyi’s treatment as arising from Newpark’s stereotypical assumptions about evangelical Christians and Newpark was unable to provide a non-discriminatory explanation for its actions.

Employers should note that the Tribunal’s decision was highly fact-sensitive. Inappropriate manifestations of religious beliefs could still provide grounds for a fair dismissal in certain circumstances, and the fact that an employee is invited to express an opinion is not a free pass to speak without repercussions.  In this case, it was the employer’s flawed analysis of the evidence and its sub-standard disciplinary process that sealed its fate.