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Welcome to our August 2014 Employment Law Newsletter, keeping you up to date with changes in employment law and informing you of recent case developments over the last month.
DEVELOPMENTS TO LEGISLATION
Shared parental leave: draft regulations laid before Parliament
On 21 July 2014, the government laid three sets of draft regulations before Parliament to implement the new system of shared parental leave under the Children and Families Act 2014. Two further sets of regulations are still awaited. There are no major changes from the earlier drafts published for Consultation.
As it stands, the scheme will be available in respect of children due to be born or placed for adoption on or after 5 April 2015. Although this seems quite a way off, remember that employees conceiving a child now are likely to be entitled to this right and may start making plans or putting in requests in the coming months.
As a follow up to our recent breakfast briefing, we are currently offering a Shared Parental Leave Policy at a discounted fee. This will give guidance on the new provisions and set out clear rules for employees and employers to follow to simplify the various issues including the complex notification procedures. Please contact us for more information.
National minimum wage increases for October 2014
The government has accepted the recommendations of the Low Pay Commission and announced the following increases in the national minimum wage, which will take effect from 1 October 2014.
The new rates are as follows:
• The standard adult rate (for workers aged 21 and over) will rise to £6.50 an hour (from £6.31).
• The youth development rate (for workers aged between 18 and 20) will rise to £5.13 an hour (from £5.03).
• The young workers rate (for workers aged under 18 but above the compulsory school age who are not apprentices) will rise to £3.79 an hour (from £3.72).
• The rate for apprentices will rise to £2.73 an hour (from £2.68).
• The accommodation offset will rise to £5.08 a day (from £4.91).
Prohibiting the advertising of jobs exclusively in other EEA countries
On 23 July 2014, the government confirmed its intention to consult on banning “overseas only” recruitment practices by employment agencies. The government seeks views on amending the relevant regulations, to include a new regulation prohibiting employment agencies and employment businesses from advertising vacancies in another EEA country, without also advertising in Great Britain. The government’s intention is “to create a level playing field for workers”.
TUPE: micro-businesses able to inform and consult with employees directly
The last of the changes made to the TUPE provisions came into force on 31 July 2014. The new regulation 13A of the TUPE Regulations now provides that employers with fewer than ten employees may directly consult affected employees in cases where there are no existing appropriate representatives and the employer has not invited employees to elect employee representatives. The previous provisions required the appointment and election of employee representatives irrespective of the size of the employer.
CASE LAW DEVELOPMENTS
Does obesity qualify as a disability?
If yes, then the duty to make reasonable adjustments might include employers having to provide bigger chairs and desks, car parking spaces near the front door, and duties involving less mobility.
The Advocate General has issued an opinion on this point in Kaltoft v The Municipality of Billund. The first part of the opinion confirmed that obesity was not a protected characteristic in itself. However, he then went on to consider whether obesity, without more, fell within the definition of a disability.
He concluded that in cases where the condition of obesity has reached such a degree that it hinders full participation in professional life on an equal footing with other employees due to physical and/or psychological limitations, then it can be considered to be a disability. So if an employee is severely obese they might be disabled if the obesity has a real impact on their ability to participate in work. The full decision of the European Court of Justice has not been received but it usually follows the opinion of the Advocate-General.
Therefore, employers should be aware of the possibility that a seriously obese individual may be protected under disability discrimination if there is a significant adverse impact on their day to day activities such as any significant mobility issues.
Contractual disciplinary procedure did not allow for increased sanction on appeal
In McMillan v Airedale NHS Foundation Trust the Court of Appeal has upheld the High Court’s decision that an employer could not increase the disciplinary sanction it imposed following the employee’s appeal. The employer had incorporated a formal and detailed disciplinary procedure into the employee’s contract. The employee appealed against the imposition of a written warning and the Trust contemplated increasing the severity of that sanction, which would lead to the employee’s dismissal. The court held that the contractual procedure did not allow for an increased penalty on appeal. If the Trust wished to reserve its right to increase the disciplinary sanction on appeal, they should have made this explicit in the procedure.
This case emphasises the importance of employers following their own disciplinary procedures and ensuring that they are as thorough and comprehensive as possible.
Judge should not have read words into poorly drafted restrictive covenant
In Prophet plc v Huggett the Court of Appeal has overturned the High Court’s decision to read words into a non-compete covenant and termination. The covenant, if read literally, offered the employer no protection at all. The Court of Appeal disagreed with the High Court’s view that the clause was ambiguous and that there had been a drafting error. The court held that the only interpretation available was the one that rendered the covenant useless. In the court’s view, the employer had simply not thought through the extent to which its chosen words would in fact provide adequate protection. The employer had made its bed and now had to lie in it.
This case demonstrates that if you are going to use post-termination restrictions to prevent competition that they need to be carefully and professionally drafted to avoid them being rendered useless.
Mandatory Retirement at 65 was objectively justified
In Seldon v Clarkson Wright & Jakes the EAT upheld an employment tribunal’s decision that a law firm’s mandatory retirement age of 65 for partners was a proportionate means of achieving the legitimate aims of workforce planning and staff retention. The retirement age was objectively justified and did not amount to direct age discrimination against a partner, Mr Seldon, who was required to retire on that date. The tribunal correctly determined where the balance lay between the discriminatory effect of choosing a particular retirement age and its success in achieving the aims identified.
This decision confirms the earlier decision in his case and gives hope to employees who wish to use fixed retirement ages. However, please be aware that this case was decided on its specific facts and that you should take careful advice before using set retirement ages.
If you require any further clarification in relation to the above developments, or if you need any further assistance then please do not hesitate to contact our team of specialist employment solicitors on 0161 832 3304.