In this update we have picked out a number of recent news items that relate to employment rights or processes that will be of interest to small and medium-sized business/organisations.
Right to work in the UK
There is already a requirement on an employer to carry out a ’right to work (in the UK) check’ on employees. Failure to carry out a check or to do it properly can lead to a fine of up to £20,000.
The good news is that from 28th January 2019, for non-EEA nationals who hold biometric residence permits or biometric residence cards you can rely solely on the Home Office online right to work checking service.
Employees who use the online service will be excused from a civil penalty if:
- The online check confirms that the employee is allowed to work in the UK and perform the work in question.
- The employer is satisfied that any photograph on the online right to work check is of the employee.
- A copy of the online check is retained for at least two years after the employment ends.
- In respect of students, details of the term of vacation dates of the individual’s course of study are obtained and retained.
EEA nationals who have not been granted status under the EU settlement scheme will still need to demonstrate their rights to work using the appropriate documents.
The situation regarding EEA nationals is clearly linked to what happens with Brexit.
The Home Office has now published information to clarify how was the UK immigration rules will be applied to EU citizens in the event deal with the EU cannot be reached.
EU citizens (plus family) who are resident in the UK on or before 29th of March 2019:
EU citizens in the UK will have until 31 December 2020 to apply for pre-settled or settled status under the EU settlement scheme (you can use the right to work check-in service for the EU settlement scheme).
EU citizens who arrive in the UK on or after 30th March 2019:
Temporary transitional rules will apply between 30th of March 2019 and 31 December 2020 which mean EU citizens can stay for up to 3 months without a visa and are permitted to study/work. Those wanting to stay longer will be able to apply for a non-extendable three-year visa which will permit study/work.
After the transition period, all visa applications will fall under the new skills-based immigration system which is planned to take effect from 1 January 2021 and will be applied equally to EU and non-EU nationals.
The dangers of unilateral salary cuts
In his role as a sales executive, an employee had reported disappointing figures over the course of four year period. As a result, his employer asked him to accept a reduction in his basic remuneration of almost 50% (from £45,000-£25,000 per annum). He refused and alleged that this was an attempt to remove him from the business. When the employer rejected this and indicated that it would move forward with the unilateral pay cut, the employee resigned without notice and brought a tribunal claim on the grounds of constructive unfair dismissal. He argued that such conduct breaches the employed term of mutual trust and confidence within their employment relationship.
The employment tribunal rejected the claim on the grounds that the employee’s poor performance and failure to improve gave his employer reasonable and proper grounds to take action.
On appeal, this decision was overturned and the appeals tribunal said that unilateral pay cuts will revoke any express term of an employment contract (in relation to remuneration) and will generally entitle immediate resignation.
This decision demonstrates a unilateral pay cut will generally in time for the employer to resign with immediate effect with potential claims of unfair and wrongful dismissal.
Postponement of disciplinary hearings
This is a common situation faced by employers. A worker is due to attend a disciplinary but then request a postponement. HR practice has been to allow one or maybe two postponements but then to conduct the hearing if necessary in the employee’s absence. In a recent case, an employer turned down a request to postpone a hearing that it already been postponed because of sick leave and holiday. The employee had said that their trade union companion was unavailable.
The court found that given the employee’s long service history a further delay of fewer than two weeks would not significantly impact the employer and therefore the dismissal was unfair.
Pay in lieu of annual leave
The European Court of Justice has held that a worker who does not apply for paid annual leave does not automatically lose the right to that leave or a payment in lieu of intake and leave on termination.
The worker must’ve been given an opportunity to take that leave and it is for the employer to show that it encouraged the worker to do so, while informing him or her, accurately and in good time, at the risk of losing that leave if it is not taken.
Confirmation that “self-employed” plumbers are workers
In 2018 the Supreme Court held that a plumber who is employer labelled him as self-employed in fact qualified as a worker, entitling him to basic employment rights such as paid annual leave.
The government has previously tackled alleged underpayment of PAYE by self-employed contractors through HMRC IR35 rules and they are now hinting at legislation to make a clear distinction between workers and genuinely self-employed contractors.
Employers that regular use self-employed contractors should ensure that they are familiar with the definition of a worker and employee.
New legislation comes into force from six April 2019 requiring employers to provide an itemised payslip to all workers and show that I was worked on payslips where the workers pay varies depending on the number of hours they have worked.