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…

The ARC to work with BIS on AWR guidance

The Association of Recruitment Consultancies (ARC) has reported that it has been invited by the Department of BIS to work with it on drafting promised guidance for the Agency Workers Regulations. The Department has indicated that it plans to issue guidance as soon as possible on the Regulations that are due to apply from October 2011. Adrian Marlowe, chairman of ARC, said “Having played a significant part in the consultations leading to the Regulations we are pleased to now be invited to the drafting table. It is hoped that the guidance will unravel some of the more complex areas of the Regulations and we will certainly lend our weight towards achieving that objective. However guidance cannot itself change the law, it can only seek to clarify confusing areas. Those currently awaiting the guidance should note this accordingly.” As guidance is only intended as a non enforceable explanatory tool the ARC’s…

Government plans to tax EBTs

The announcement made this week states that a new Finance Bill will introduce the measures in April 2011. The draft rules include anti-forestalling measures to stop upfront payments or arrangements being made from 9th December and before the legislation takes effect. According to the Treasury, the legislation will “ensure that where a third party makes provision for what is in substance a reward or recognition or loan in connection with the employee’s employment, an income tax charge arises”. Clearly targetted are those schemes that use employment benefit trusts and loans as part of an arrangement to reduce levels of tax paid. Accordingly this would appear to attack some schemes used to pay agency workers and contractors. The Treasury estimates that 5,000 employers and 50,000 workers will be affected, as it expects many such schemes to be “discontinued” as a result. For more information or advice on the application of the…

Agency worker not an employee

The Court of Appeal has decided that Mr Tilson, who was employed by an umbrella company and provided services via an agency to the end hirer (Alstom), was not an employee of Alstom. Mr Tilson was trying to bring a claim of unfair dismissal against Alstom. This case is particularly interesting because there were elements that suggested there was an employment relationship between Mr Tilson and Alstom; namely: there was a high degree of integration of him into workforce the contractual arrangements said there would be no control over his work yet this was not true in practice he had to notify his line manager of intended holidays. The Court of Appeal rejected these arguments and decided that Mr Tilson was not an employee. The Court of Appeal made the following general points: integration of an agency worker into a workforce is a requirement for an agency worker to be…