Court rejects review of new travel expenses law

A judicial review into the Government’s decision to stop travel expenses for journeys to a temporary place of work from counting towards the calculation of the National Minimum Wage has been rejected today by the Administrative Court. Mr Justice Kenneth Parker ruled that the Government’s proposed legislative amendment to the National Minimum Wage Regulations was not unlawful, irrational or disproportionate. He also refused leave to Cordant Group plc, which has a number of staffing companies as subsidiaries, to appeal his decision. As a result of the decision the amendment will come into force as planned on 1 January 2011. It does not outlaw the claiming of travel expenses to a temporary workplace, which can continue to be paid gross subject to the usual tax rules. However,  these expenses will no longer count towards the calculation of the national minimum wage. The ruling and new law probably also affect subsistence and…

Consultation for unified Courts and Tribunals

A consultation has been launched by the Ministry of Justice on whether to merge the Courts service and the Tribunals service to create one single organisation. The new organisation would include the Employment Tribunals service and the Employment Appeal Tribunal. The proposed name of such organisation is ‘Her Majesty’s Courts and Tribunals Service’. The legal processes and procedures will not change as the focus is on unification of administrative and management functions. The Ministry of Justice insists that a unified service would bring about significant benefits including greater efficiency in administration and reduced costs. The consultation ends in late February 2011.

Equality Act Code of Practice published

The Equality and Human Rights Commission (EHRC) has published three Codes of Practice on the Equality Act 2010 which came into force in October 2010.  The Codes of Practice cover three areas: Equal Pay Employment Services, Public Functions and Associations. The Codes of Practice provide guidance to organisations about the provisions in the Equality Act 2010. An Employment Tribunal should take the Codes of Practice into account in cases involving areas they cover. The Codes of Practice can be found on the EHRC website http://www.equalityhumanrights.com/

Avoiding scam claims in job applications

Unfortunately, there are a minority who seek to abuse anti-discrimination legislation by bringing false claims in the Employment Tribunals. These scams usually focus on job applications and the scam operates by an individual submitting two job applications which only differ on particular characteristics. For example, one application has a typical Anglo-Saxon name, and the other does not. Where one application is accepted and the other rejected; the applicant then commences a discrimination claim. Employers often pay out a few hundred pounds to avoid the nuisance of such claims. Employment Tribunals are aware of such scams and generally will not award compensation when they suspect the claim has resulted from such a scam. Recently phony claims have been in the context of age discrimination where an applicant has applied for a job clearly suitable for a young person and stressed their age in the application. If he/she is not invited for…

Employment Tribunal appeals only on a point of law

A recent case serves as a reminder that you cannot appeal to the Employment Appeal Tribunal (‘EAT’) against a decision of an Employment Tribunal, unless it is on a point of law only. The EAT will not hear an appeal which relates to a disputed fact in a case. In this case, an employee who had brought a sex discrimination claim against her employers, alleging that they had not offered her a new post because some members of the interview panel knew she was pregnant. The Employment Tribunal, faced with conflicting evidence, had ruled in her employer’s favour and dismissed the sex discrimination claim. The employee appealed but the EAT said no point of law was involved; the ruling by the Employment Tribunal was based on the question of whether any of the interview panel members knew that she was pregnant and this was simply a matter of fact for…

Bonus excluded upon termination of employment

The Court of Appeal has ruled that an employer does not have to include a bonus in payments made to an employee when their employment ends if the contract allows this. In this case the contract allowed for a bonus to be paid after 12 months of employment and stated ‘you must be employed by the company in order to receive the bonus’. The employee’s employment was terminated 10 days short of the 12 month period, and he was paid payment in lieu of notice (PILON) based on salary only. The employee sought the unpaid bonus as part of the PILON payment, but the Court ruled that this was not how the contract could be construed given the wording relating to when the bonus became due. Although the case is specifically related to the particular contract, it is a helpful pointer that it can be beneficial to specify in contracts when…

Judicial review of proposed NMW changes

With many lower paying agencies and umbrellas worried about expenses and the National Minimum Wage (NMW), the Cordant Group PLC has lodged a judicial review. The application challenges the proposed amendments to NMW legislation due to come into effect on 1st January 2011. The amendments will prevent travel expenses from counting as income for the purposes of calculating whether a worker has received the National Minimum Wage or not. These changes will have a significant impact on some low paid agency workers, particularly those operating via umbrella companies. In terms of net pay, someone on £6.00 per hour based on an average 35 hour week with £50 worth of expenses would currently take home £199.50. If the proposed changes take place, the same worker would see their take home pay reduced to £183.65, to maintain the same level of take home pay, the worker’s rate would need to increase to…

EU says “non” to increased maternity pay

Employers and recruiters can breathe a sigh of relief as the EU Council has rejected proposals for the right to 20 weeks’ fully paid maternity leave. Currently in the UK, employees and qualifying agency workers are entitled to up to 39 weeks of maternity leave, the first 6 weeks of which is to be paid at 90% of average pay. However earlier this year the European Parliament proposed to extend rights across Europe to full pay for 20 weeks. One estimate circulating was that the proposals would cost around £2.5 billion a year. The UK was among other EU nations including Germany and France that successfully lobbied for the proposals to be rejected. Provisions relating to paternity leave were also rejected from the draft Pregnant Workers Directive. Belgium, the current holder of the EU presidency, will now propose a plan to reach a compromise, which is expected around the New…

Data Protection penalties issued by the ICO

Recruitment company hit as, for the first time, the Information Commissioner’s Office (ICO) exercises new powers to serve penalties for serious data protection breaches. We reported earlier this year that the enforcement powers of the ICO had been extended. The new powers allow the ICO to issue a penalty notice up to the value of £500,000 in respect of serious contraventions of the 8 Data Protection Principles. The ICO has now announced the first two such penalties to be issued. The first fine amounted to £100,000 and was imposed on Hertfordshire County Council after it erroneously faxed sensitive information to members of the public, including information regarding a child sexual abuse case. The second fine was imposed on a company offering recruitment services. This time the fine was for £60,000 after the theft of a laptop which contained the personal data of 24,000 people. An employee had been allowed to…

ARC welcomes government plan to end “gold-plating”

The Association of Recruitment Consultancies (ARC) welcomes the Government’s commitment to end “gold plating” announced by the Business Secretary Vince Cable on 15th December. Adrian Marlowe, Chairman of the ARC commented “This is a very welcome move by the Government. No one is asking for favours, all that is needed is for the Government to help British business compete fairly. That is the route to creating greater employment and prosperity for all. “It makes sense that, in future, Directives will be directly copied into UK law rather than adding on an interpretation that many may disagree with.” The ARC believes that the direct copying principle would address to a large extent one of the problems of implementing Regulations following an EU Directive. They are not subject to the same open debate as UK led legislation. Thus, as with the Agency Workers Regulations, the rules pass into law without a Parliamentary vote. Marlowe…