When Christmas parties get out of hand

It is the season for Christmas parties and many workplaces will hold events in pubs or hotels where alcohol is likely to fuel the proceedings.

That is the context for the latest in a series of court decisions concerning the liability of employers for the actions of their employees. 

When I was first in practice my clients would often find that an employer argued that they ought not to be liable for what other employees had (negligently or wilfully) done – on the basis that such employees were “on a frolic of their own”.  The employer’s defence would be that they ought not to be held responsible for things that were not done in the ordinary course of employment.  So a bouncer using more than reasonable force to eject someone from a nightclub might result in a successful claim against the employer – since the bouncer was doing something that he was employed to do, even if he overdid it.  But the weaker the link between work and an employee’s conduct, the more likely the employer’s defence would be to succeed.

This all changed fairly dramatically in the Morrisons case this year when the supermarket was held liable for catastrophic injuries suffered by a customer following a very violent and quite unprovoked attack upon him by an employee at the supermarket’s petrol station.  It was just, said the Supreme Court, to hold the employer liable because of the “connection” between the employee’s work and the assault.  But that connection appears to have been little more than the fact that the employee was physically present at the place of work and inevitably going to come into contact with customers.

So it is somewhat surprising, then, to see the latest case – Bellman v Northampton Recruitment - taking a rather different tack in relation to an incident of violent behaviour at a Christmas party.

Mr Bellman was assaulted by the owner/manager of the company for which he worked, following an argument at a social event. 

Now, it is commonly accepted that the “workplace” does not end at the office door.  An employer can end up liable for, say, sexual harassment that happens when colleagues go together to the pub after work. 

In Bellman the Claimant and colleagues had been to a Christmas party and thereafter an impromptu drinking session took place until the early hours. 

Tragically Mr Bellman suffered a brain injury following an assault upon him by his manager.  He will not work again.

The High Court has held that the company is not liable to compensate Mr Bellman. 

The Judge took the view that there was not a sufficiently close connection between the “after party” and the Claimant’s employment.  This despite the fact that this event immediately followed the Christmas party, involved the Claimant, his boss and their colleagues, and the violence was the upshot of an argument that at least in part related to the manager’s assertion of his absolute authority at work. 

Since the manager himself is uninsured and not in a financial position to meet a substantial compensation payment if a claim against him succeeds, Mr Bellman’s main hope for a remedy has to lie in a claim against the employer – which of course has the benefit of employer’s liability insurance.

So Mr Bellman at present is without a remedy against the firm; and his remedy against his manager is not worth pursuing.

I find the decision in Bellman surprising, having regard to the Supreme Court’s view in Morrisons.  It seems to me that there was here altogether just as much of a “close connection” – indeed, arguably a greater one (bearing in mind the context of the argument that erupted) – than in the earlier case.

Claimant will, rightly, look for “deep pockets”.  It seems to me not unreasonable that an employee facing career ending injuries ought to have the opportunity to take advantage of insurance that can spread the cost of compensation across the community of employers generally.  That’s the whole point of insurance: so that the many can help the few.  If the Supreme Court’s view – rightly, in my opinion – is that a “connection” with work needs be made out in only pretty general terms, then that has to be a good thing for deserving Claimants in the general scheme of things and is not going to put the cost of employer’s liability insurance through the roof.  I will revisit the point if, as I suspect, Bellman is pursued on appeal.

Paul Scholey - Senior Partner

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"Employee Shareholder” regime

The Autumn Statement sees  the Chancellor phasing out the “employee shareholder” regime – initially by removing the tax advantages associated with it; but in due course it is expected to disappear altogether.

This is no great surprise.

We blogged about the scheme when it was introduced in late 2013.  You can read our reservations here:  http://morrishsolicitors.blogspot.co.uk/2013/09/employee-shareholders.html

Not for the first time in the last few years, dogma has overcome common sense – until the stark weight of reality sets in.

We predicted the scheme would be short-lived, but even in April of 2016 some tinkering had been required.

It turns out, unsurprisingly, that the idea of selling your employment rights was not terribly attractive – save for a few who saw tax advantages associated with it – and it’s those loopholes that were limited in April, and are now being closed as a precursor to abolition of the scheme entire.

Ironic then, that a proposal driven by the ideology that entrepreneurs don’t need rights but will trade them for a business share, ends up being a tax avoidance mechanism for the well off.

We’ve blogged before, too, about governments and their attitude to consultations (i.e. that they don’t tend to listen to the experts – or indeed anyone).  A classic example, we think.  No-one wanted the ES regime, no-one thought it was needed or desirable or likely workable.  A few wasted tax pounds later, and back to square one it is.  We know that “experts” don’t seem to be flavour of the month this year, but really?

Paul Scholey - Senior Partner

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Future world of work and rights of workers inquiry

The Business, Energy and Industrial Strategy Committee has launched an inquiry into the ‘future world of work’ and in particular, the 'gig economy' – agency workers, zero-hours work, the use of ‘self-employment’, worker status, low pay and poor working conditions. They refer to the recent Sports Direct scandal and also other organisations with similar poor working conditions.

This is good news. Hopefully, whatever its outcome, turning the lamp onto these types of employers can bring some heat on these organisations with more public attention drawn to the growth of the ‘precariat’ – individuals who work in poor conditions with weak terms and conditions, be it low pay, the absence of paid holiday, sick pay and the like.

My view is that the rise of the ‘precariat’ is nothing new – this country has a history of shoddy employers treating working people poorly and of governments legislating to either counter this, with increased protections (the introduction of redundancy pay in the 1960s, unfair dismissal in the 1970s and the recent(ish) minimum wage in the 1990s) or to aid it, by reducing employment rights (the scrapping of wages councils, the introduction of ET fees of up to £1,200, limits on compensation – all within the last 3-4 years). Since 2010, the move has been to reduce employment protection and to restrict trade unions. My view is that this has encouraged shoddy employers and weakened the position of employees.

Evidence suggests that as a result of the reduction in protections, the equal pay gap is now growing and certain sectors of the workforce, such as disabled people and pregnant women or women on maternity leave, are suffering more, not less, discrimination. I also believe that it has encouraged the growth of the ‘gig economy’ – individuals working in sham ‘self-employment’ situations or in weak zero-hours roles with little control or say about the number of hours they work. This causes illness, harms the economy and damages lives, not least children of adults who work for low pay, on horrendous hours and with uncertain futures.

I’m pleased that the Committee have this on the agenda. Let’s hope for all concerned, not least our children and grand-children, that whatever recommendations are made, they are followed by those in power and a more secure workforce results with more (not less) permanent, well-paid jobs. After all, apart from shoddy employers and obscenely profitable multinationals, how do we as a nation benefit from the rise of the precariat?

The Committee is seeking comments – please do so at:

http://www.parliament.uk/business/committees/committees-a-z/commons-select/business-energy-industrial-strategy/news-parliament-2015/the-future-world-of-work-and-rights-of-workers-launch-16-17

David Sorensen - Partner

For further information on Employment Rights please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.

Exit payments in the public sector

Exit payments (or severance payments) in the public sector have been the subject of much media scrutiny in recent months.

As employment lawyers acting for private and public sector employees, we regularly come up against these issues when it comes to trying to advise on and negotiate settlements or agree termination packages. As trade union lawyers, we are also opposed in principle to any government attempts to water down employee rights.

On 26 September 2016, HM treasury issued its response to a consultation on reforms to public sector exit payments. The proposed changes will affect the civil service, the NHS, teachers, police, firefighters, members of the armed forces and employees of local authorities.

The government proposals are as follows:

1. Setting a maximum tariff for calculating exit payments at three weeks' pay per year of service.
2. Introducing a cap of up to 15 months' salary on all redundancy payments.
3.  Setting a maximum salary for the calculation of exit payments.
4. Tapering the amount of lump sum compensation an individual is entitled to receive as they get close to the normal pension age or target retirement age of the pension scheme to which they belong, or could belong, in that employment.
5. Requiring employer-funded early access to pensions to be limited or ended, denying access altogether by increasing the minimum age requirements or introducing more flexibility (which I interpret as ‘restrictions’) as to the circumstances in which pension top ups are available.

The government says these reforms could achieve savings of up to £250 million a year and bring public sector exit terms in line with those in the private sector.

And let’s not forget, the changes proposed above are in addition to two other recent initiatives:

1. Imposing a cap of £95,000 on the total aggregate value of most public sector exit payments.
2. High-earning employees leaving the public sector to repay some or all of their exit payments if they return to public sector employment within 12 months of their departure.

The government received around 350 responses to the consultation on public sector exit payments. The majority opposed the proposals. However, despite that opposition (and as is commonly the case these days) the government has suggested that it will nevertheless be going ahead with some or all of the changes. I begin to wonder whether responding to these consultations is at all worthwhile.

Aside from the obvious attack on public sector pay and benefits, two major issues were raised in opposition to the proposals:

1. What about collective agreements?

The public sector has the benefit of numerous workplace collective agreements, carefully negotiated between employers and trade unions, often over decades, and which afford employees significant redundancy benefits. Those collective agreements are industry-specific, balancing the needs of the employee and employer. Imposing restrictions that cut across these agreements will be damaging, have a disproportionate impact on particular groups of employees and could have a serious impact on staff morale.

2. What about discrimination?

Might employer-funded early retirement and tapering payments for those close to retirement age be age discriminatory? There are certainly cases where it has been argued and questions of ‘justification’ and ‘proportionality’ are surely going to come into play, depending what form the final changes take.  It is understood that the government will consider the case for applying elements of the framework flexibly, for example, where it can be demonstrated that a particular option may not lead to significant cost savings, where there is an alternative approach that may lead to costs savings, or where a particular option may have an unwarranted impact on equality. However, just how much leeway there is for this remains to be seen.  

The government wants departments to begin restructuring their exit terms immediately and to produce proposals for reform by the end of 2016. Departments should consult on the proposals and follow the normal process of discussions and negotiations with trade unions and other workforce representatives, to try to seek agreement to them. The government would like the entire process to be concluded by the end of June 2017.  Should it not be possible to achieve meaningful reform within this timescale, the government will consider options for primary legislation to take forward reform.

So it is not so much a question of “if” these changes come in we need to be prepared for them, it is a question of “when” they do but I think we can count on continued strong opposition from trade unions. 

Daniel Kindell - Associate Solicitor

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Taxation on Termination - The Price of Simplicity

HMRC has published a piece of draft legislation which attempts to simplify the current regulations surrounding taxation of termination payments. The legislation is due to come into force in April 2018 and is currently open to consultation until the 5^th of October 2016.

It has been suggested that the overall complexity of the current tax rules in terms of termination payments make the system overly open to manipulation, therefore, a number of simplifications have been suggested.

Firstly, I will address changes to PILONS. PILONs or payments in lieu of notice currently take two main forms, contractual and non-contractual. Although almost identical in nature the fact that one is contractual and one isn’t makes all the difference for tax purposes. Currently if you are contractually entitled to a PILON it will be subject to tax, however, non-contractual PILONs will not. This seems like an arbitrary difference.

There are two ways to potentially fix this situation but only one obvious one for HMRC. So, it will not come as a surprise that they have proposed to make all PILONs taxable regardless of contractual status. The distinction between the two forms will stay for clarity’s sake but in terms of tax they will be treated equally.

How this change will affect the use of PILONs is yet to be seen, however, now that the loophole has been plugged it certainly makes non-contractual PILONs less attractive from an employee’s perspective. Overall it seems that the simplification of PILONs has come at the expense of the employee, just how much expense is yet to be determined and could potentially lead to employers being asked to increase PILONs to account for the extra tax.

Secondly and probably most importantly is the confirmation that the £30,000 tax free allowance on termination payments will remain intact. This has been debated on numerous occasions and it comes as a welcome surprise that it has emerged relatively unscathed.

However, a key change that has been proposed is the introduction of employer national insurance contributions on payments over £30,000. This change will mean that on any termination payment over £30,000 employers will be liable to pay national insurance contributions. This may seem irrelevant to employees at first glance but the implications could be quite serious.

Two things seem fairly certain with this change:

• Firstly, Employers will be less likely to want to venture over the £30,000 tax fee allowance in terms of payment;
• Secondly, if they do venture over the tax free allowance the tax is likely to impact the amount of settlement, meaning the employee may have to foot the NIC bill instead of the employer.

Given that the highest rate of employer’s NIC in 2016-2017 is 13.8% that could constitute a large deduction from any employee’s likely settlement. Overall I think it’s fair to say that if this new procedure is introduced it will see employees disadvantaged in many cases.

Finally, the last major change is the confirmation of taxation on injury to feelings awards. Currently there is conflicting case law surrounding this subject which HMRC have attempted to clarify by putting a blanket tax on all injury to feelings awards. Again this is not ideal for employees, particularly since injury to feelings awards often seek to compensate for some particularly horrendous treatment by employers. With current income tax rates ranging from 0 – 45% this could significantly reduce the settlement amount that the employee actually receives.

Clearly there is a price to pay for simplicity and as the draft legislation stands it will likely be employees paying the lions share, however, it is worth reiterating that this is merely the draft legislation and much could change before the implementation date in 2018.

Link to the draft legislation. 

James Battle - Legal Assistant

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Ban on Islamic Headscarves – Indirect or Direct Discrimination?

This issue has come to light in the media recently, with conflicting decisions from two Advocate Generals causing some controversy.

In Bougnaoui and another v Micropole SA (Case C-188/15) Advocate General Sharpston considered whether a French employer's ban on the wearing of Muslim headscarves by staff amounted to direct and/or indirect discrimination under the Equal Treatment Framework Directive (2000/78/EC). AG Sharpston’s opinion was in stark contrast to the opinion given recently by Advocate General Kokott in Achbita and another v G4S Secure Solutions NV (Case C-157/15), involving very similar facts.

The facts in Achbita involved a Muslim employee who began to wear a headscarf three years into her employment at work despite a company rule which prohibited the wearing of any visible signs of religious beliefs. She was dismissed and she appealed through the courts to the Belgian Constitutional Court which then posed the question to the European Court of Justice (ECJ).

AG Kokott expressed the opinion that the prohibition of wearing a headscarf stemmed from a general neutrality policy, and so did not amount to direct discrimination; at most, it could amount to indirect discrimination. Even then, it might be justified as an occupational requirement, with consideration to be given to the size of the symbol, the nature and context of the employee's activity and the national identity of the Member State concerned.

In Bougnaoui, the Claimant was employed by Micropole SA as a design engineer. She was a practising Muslim and wore an Islamic headscarf at work; her role involved her meeting with clients face to face. A client complained to Ms Bougnaoui’s employer and requested that there should be “no veil next time”. She was asked not to wear her headscarf when visiting clients and when she refused to do so, she was dismissed.

The French Labour Tribunal dismissed Ms Bougnaoui's claim for discrimination based on her religious beliefs and held that the dismissal was well founded on the basis of a "genuine and serious reason".

The case was referred to the ECJ and questions were asked specifically whether, on the assumption that Ms Bougnaoui's treatment was discriminatory, it could be justified as being based on a “genuine occupational requirement” under Article 4(1).

Advocate General Sharpston opined that Ms Bougnaoui's dismissal for wearing a headscarf when in meetings with customers of the employer's business constituted unlawful direct discrimination on the grounds of religion or belief. She further stated that it was clear that she had been treated less favourably on the ground of her religion than a comparator would have been treated in a similar situation.

AG Sharpston also sought to widen the concept of direct discrimination to include, not only less favourable treatment because of a person's religion, but less favourable treatment because of a person's manifestation of their religion – this is significant because there is no general defence of objective justification to a claim of direct religious discrimination.

So, will the decision affect UK law?

If AG Sharpston’s opinion is upheld then it may potentially add a direct discrimination claim. The Judgment in the case of Eweida v British Airways plc will still be considered good law in the UK. The current assumption in the UK is that dress codes could give rise to an indirect discrimination claim, rather than direct, as the requirement to dress in a particular way is applied to everyone.

Given the two very conflicting opinions in these two cases, the decisions of the ECJ will be eagerly anticipated.

Kiran Chana - Trainee Solicitor

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The EU debate - discrimination

In this blog I want to look at the legal effect of EU membership from the perspective of discrimination law.

I begin by quoting (again – I hope he does not mind) from the advice of Michael Ford QC to the TUC* on this subject:

“It is difficult to overstate the significance of EU law in protecting against sex discrimination.“

I am (again) deliberately trying to avoid a political take on this stuff. I think Ford’s point would be accepted without significant qualification by perhaps 80-90% of employment lawyers.

Why is that? Here are a few concrete examples of legal changes that arose directly out of EU legislation/caselaw:

• Protection from discrimination on the grounds of sexual orientation. Until 2003 this was not a protected characteristic (like sex, race and disability). The Regulations that made it so came about in consequence of the EU Framework Directive.

• Pregnancy protection: the European courts decided that it was not open to an employer to argue that it could justify discrimination against a pregnant woman by saying “we would have treated a man off with sickness the same way” – they ruled that pregnancy is (rather obviously) a female-specific condition – so that no comparison was necessary. Without that ruling protection from pregnancy discrimination would be hugely undermined.

• In the Equal Pay sphere the ECJ extended the concept of pay to pensions – so that part time workers were successfully able to claim equality of terms on the pensions front (and since most part timers are women…

• The ECJ has opened the way to claims of “associative discrimination” e.g. you must not discriminate against A, on the basis of A’s child’s disability (even if A is not disabled).

• Compensation: the European requirement for proper compensation for discrimination made it so that the UK now allows unlimited compensation for victims of discrimination (it is plain that imposing a cap is on the agenda in the event of a Leave vote).

None of this is controversial stuff. Links to the cases and Regulations that support these conclusions are all in the advice to which I link below.

Of course, none of this means you must vote any particular way. My aim is simply to shed some factual light on just a small part of a subject that seems littered at present with half-truths and hyperbole.

* https://www.tuc.org.uk/sites/default/files/Brexit%20Legal%20Opinion.pdf

Paul Scholey - Senior Partner

For further information on Employment Rights please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.

The EU debate – thoughts on holiday rights

There is a lot of fairly heated discussion on the “Brexit” debate.  The claims and counter-claims by each side have begun, I suggest, to border on the silly.  Hyperbole is the order of the day.

I want to look, in the next couple of weeks, at just a handful of what I think are concrete matters (in so far as law is ever so dependable) that relate to the legal effect of our participation in the EU.

First off: holidays.

My clients were always surprised when, early in my career (nearly 30 years back), I advised them that they were not automatically entitled to paid holidays.  Indeed, they were not entitled, unless their contract provided otherwise, to any holidays at all.  Not even bank/public holidays.  It was perfectly possible to agree to work 52 weeks a year, with no holiday; or to find that such holidays as one might take, were unpaid.

That held true till 1998 and the Working Time Regulations (WTR).  Under those Regulations, as subsequently amended, employees are now entitled to 5.6 weeks a year paid holiday.  Also rest breaks, and a limit (usually honoured in the breach) on working hours.

The WTR arose directly out of Europe’s health and safety based Working Time Directive.  I doubt many people now think it’s a bad thing, to have a legal entitlement to paid time off.  But UK governments have not all agreed.

So it’s worth bearing in mind that the UK government:

• took 2 years longer than it ought, to implement the WTR
• challenged the legality of the Directive in the ECJ
• campaigned against it
• took advantage of derogations from it (e.g. the individual opt-out for the maximum working week)
• framed the WTR so that regular overtime and e.g. commission payments were all ignored in calculating holiday pay

Michael Ford QC, in his excellent advice to the TUC* on the implications of a Leave vote (and whether you agree with him or not, it’s an impressive piece of work), says this:  “In  the  event  of  Brexit,  substantial changes to or wholesale revocation of WTR is predictable.”  That can’t be far wrong, given the above mentioned approach of the UK to the WTR/Directive historically.

We can see more recent evidence of this in relation to the “Bear Scotland” series of cases on calculating holiday pay.  As soon as it became clear that a European approach to calculation was appropriate (so that e.g. overtime would be included in holiday pay), the government legislated almost overnight a) to put a 2-year “long stop” on claims for historical back pay and b) to prevent aggregation of claims where there existed any 3-month or longer gap between underpayments.

And to get an idea how politicians are already thinking, you can do worse than looking here: http://www.publications.parliament.uk/pa/bills/cbill/2015-2016/0046/cbill_2015-20160046_en_2.htm#l1g1 – a link to the Private Members’ Bill supported by C R Coope, MP for Christchurch.  There is already a move to water down our holiday rights – it’s not realistic to think that will change on a Brexit event.

None of the above will be much controversial to employment lawyers.  It is a shame that the debate (on both sides of the fence) hasn’t been put in more factual (and less frenetic) terms.  I’d welcome views from readers, especially if expressed in reasonable terms.

* https://www.tuc.org.uk/sites/default/files/Brexit%20Legal%20Opinion.pdf

Paul Scholey - Senior Partner

For further information on Employment Rights please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.

Everyone’s a Lawyer

Or a jury member, perhaps.

As we reflect on the outcome of the 2-years-in-the-making Hillsborough inquest, I can’t help but notice that a lot of people have a lot of views about what happened that fateful day 26 years ago, and whether the jury got it right, or partly right, or not at all right.

It’s a common thing – all the more common in this age of insta-comment thanks to Social Media in all its many flavours.  Everyone’s a critic, they used to say.

But as a lawyer I’ve often been asked my opinion on the latest trial outcome.  “Did you see that Mr X got off?  Disgusting, isn’t it?”

As an aside I can’t help but mention that the questions always seem to be phrased this way:  did the defendant “get off”?  No, he didn’t “get off”.  He was acquitted.  He was innocent till proven guilty, and he wasn’t proven guilty, so how could he “get off” anything?

I’ll get back to Hillsborough in a moment.

My answer is, nearly always, “I don’t know enough about it to form a view.  But the jury probably did, and probably got it right.”

Court proceedings are nothing like as interesting as they are portrayed in fiction.  A moment’s brilliant cross-examination might take your breath away – once, for a minute, in a 3 day hearing – but it’s the exception, not the rule.

The rule is prosaic.  The advocates take the jury through the evidence, one step at a time.  Many witnesses recount uncontroversial matters.  Many items of evidence – photos, maps, diagrams, items from the scene and so on – will be looked at and looked at again.  Experts will give evidence, in detail, sometimes for hours, sometimes for days.  Reports running into 100s of pages will be reviewed, meticulously, by judge and jury.  Tough questions will be asked.  Opinions change.

And sometimes the outcome is the wrong one.  Every now and then there’s a miscarriage of justice.  That’s why I’m so sure that we need to keep an excellent, expert and legally-aided criminal defence system going in this country – because without it, you can face the full weight of “the system” with no-one to help; and sometimes you’ll be locked up for being in the wrong place at the wrong time.

But that isn’t common.  The usual outcome, in my experience of nearly 30 years in practice, is that the jury gets it right.

The Hillsborough jury took 2 years to get it right.  They lived and breathed that dreadful day, for 2 years.  Lawyers represented just about everyone with a proper interest.  All the questions seem to have been asked, all the evidence considered.

Is it likely that the odd commenter on Social Media is right, and that this jury got it wrong?

I don’t think so.  From what I’ve seen and read in the press – and you can’t rely on it too far, I know – the conclusions of the jury are not only likely right – but fairly unsurprising.

Social Media gives everyone the chance to be a lawyer.  But I think we should all think twice before we take a view contrary to the people who have really looked into a case.

Paul Scholey - Senior Partner

For further information on Employment Rights please visit our website or call 0033 3344 9603 and ask to speak with our Employment Rights team.

Mind the Gap – Gender pay reporting rules

The government has published in draft The Equality Act (Gender Pay Gap information) Regulations 2016. These set out the framework for the new gender pay reporting requirements.

So who will this impact?

The reporting obligation will apply to private, voluntary and public sector employers in the UK with at least 250 employees.

What are the requirements?

Employers will be required to publish the following information:-

1. The overall mean and median gender pay gap across their workforce, using an hourly pay rate for each relevant employee. “Pay” for these purposes is defined broadly and includes basic pay, paid leave, maternity pay, sick pay and most allowances such as car allowances, shift premium pay and bonuses. However overtime, the value of salary sacrifice schemes and benefits in kind will not be included as part of the calculation.
2. The difference between the mean bonus payments made to men and women. The number of men and women in each quartile of the employer’s pay distribution. This is intended to illustrate whether female employees are concentrated in a particular way in terms of their remuneration, which would potentially indicate impediments to career progression.
3. Employers will have the option to publish a narrative to accompany the pay gap information.

Where is the information to be published?

The information must be published on a searchable UK website that is accessible to employees and the public and then maintained for at least three years to allow progress to be tracked. The information must also be uploaded to a government website.

Is there to be any ‘penalty’ for non-compliance?

The plan to introduce a civil penalty in the form of a fine has been replaced with a focus on ‘naming and shaming’ the employers who fail to comply. There is no specific penalty for non-compliance at the moment but this will be kept under review.

So what happens next?

The draft regulations are subject to a consultation that will close on 11 March 2016. The draft regulations are scheduled to take effect on 1 October 2016. Employers will be required to prepare a preliminary data snapshot showing the gender pay position as at 30 April 2017 and the detailed pay information must then be calculated and published on a date of the employer’s choosing but by April 2018 at the latest.

It will be interesting to see how the implementation of the Regulations is carried out, if the website will be up and running on time, and also how many Employers will actually feel threatened enough by the “naming and shaming” to even comply with the Regulations.

Samantha Simpson - Trainee Solicitor

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Deregulation for all – except unions?

For a Government obsessed with the ‘D’ word, their proposed changes to unions by way of the Trade Union Bill will cause unions to have to dig very deep to meet the anticipated additional costs of the red-tape they are required to comply with.

The Government’s own BIS impact assessment identifies that the changes will immediately cost UK unions over £11 million and a further £26 million over 5 years. Yes, tens of millions of pounds will be incurred by unions in complying with the additional red-tape involved.

Of those costs, the Certification Office (the statutory body overseeing unions) will increase its operating costs from the current £850,000 per year to nearly £2 million per year. These costs will be paid for by the unions.

If deregulation is a good thing – and we certainly hear that from Ministers often enough – why on earth is all this additional Red Tape being required?  It is hard to avoid the conclusion that it’s a thinly-veiled attack on the Unions.  Few countries in the West regulate and control their Unions to the extent we do here.  Is it really necessary to add to that burden?

David Sorensen - Partner

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