The Government’s Approach to Women in the Workplace

In November 2011 our Prime Minister said that he was committed to end what he called the ‘scandal’ of women being paid less than men for doing the same job.

If that is right, he is going about things in a strange way.

His government are currently consulting about scrapping the statutory Questionnaire process. This is used by a person who believes she/he has been discriminated against in the workplace, for example, a female employee who believes she has been paid less than her male colleagues, to question her employer and seek information about pay and practices to see whether there has been discrimination. This process is long established having been in place for decades now and is a vital tool for a person who believes they have been discriminated against, enabling that person to obtain true facts and figures, such as pay levels between employees, particularly important when the employer tries to hide such information from its employees (very common in my experience). If this tool is scrapped it will have an enormous, adverse impact on women, disabled persons, minority ethnic groups and so forth within the workplace, making it even harder than it is now for them to show they have suffered discrimination. It will do nothing to help stop pay inequalities; in fact it will make things worse.

The Equality Act 2010 gave an Employment Tribunal wider ranging powers to require employers to stop discriminatory practices (known as ‘recommendations’). In my view, this was an extremely positive development of enormous benefit to not only those who have been discriminated against in a workplace, but the rest of the workforce, as such recommendations are designed to prevent future discrimination. Again, the government is currently consulting about scrapping this power.

The Government has just announced consultation on bringing in mandatory pay audits for employers who lose equal pay claims in an Employment Tribunal. Sounds good on the face of it, but if it’s even harder for an employee to win such a claim because Questionnaires are scrapped, the likelihood of an employer losing reduces.

Scrapping the Questionnaire process and Employment Tribunal recommendations is a scandal in my view and will find favour only with employers who discriminate and use discriminatory practices in their pay systems.

David Sorensen - Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

Age Discrimination – Do We Have a Level Playing Field?

The Supreme Court has recently given Judgment in the case of Homer v Chief Constable of West Yorkshire Police, which is a case concerned with indirect discrimination on the grounds of age and we think the consequences of this decision are interesting.

Mr Homer worked as a legal advisor for the police and in 2005 his department introduced a new grading structure.  In order for him to reach the third threshold he was required to have a law degree.  When he was appointed, a law degree was not essential.  Mr Homer was aged 62 and had a normal retirement age of 65. A law degree would take four years to complete by part-time study. Mr Homer claimed he had been indirectly discriminated against on grounds of age because the requirement to obtain a law degree disproportionately affected people aged 60-65 who would not be able to obtain a law degree before they had to retire.

Mr Homer failed in the Tribunal, Appeal Tribunal and Court of Appeal but the Supreme Court has agreed with him. It has now found that the reason for Mr Homer’s disadvantage was that people in his age group did not have time to acquire a law degree before they retired and this was indirectly discriminatory. Unless the employer can justify this less favourable treatment, it must modify its practices so as to remove the disadvantage.

Is this decision an example of the law of unintended consequences? Won’t an employee who is aged 25 be able to argue that the Supreme Court’s decision will lead to more favourable treatment for older employees? Will a 25 year old need a degree where that condition doesn’t apply to a person aged 60? How will the Tribunal find the right balance?

Perhaps achieving true equality in indirect age discrimination cases will always be taxing. It seems that any attempt to prevent a provision, criterion or practice from being indirectly age discriminatory always has the potential to lead to a disadvantage for another generation. 

Can we really therefore achieve a level playing field in indirect age discrimination?

Dan Kindell - Solicitor

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

Equal Pay Legislation

There has been equal pay legislation in the UK for more than four decades.

The Equal Pay Act (now replaced by the Equality Act 2010) became law in 1970 but direct and indirect discrimination regarding pay against women still persists in the workplace.

Pay gaps widen the higher up the pay scale you look. The recession and government cuts to the public sector are also widening the gap.

The equal pay provisions are complex, and in consequence, the cost of legal proceedings in pursuit of equal pay is beyond the reach of most women. With the issue fees set to be introduced as of April 2013, this will only add an additional burden to potential claimants.

In 2010/11 Employment Tribunals received 218,100 claims, of which only 34,600 were equal pay claims.  Of the claims, 1980 went to a full hearing – 5% of the total. Of those 5%, only 16% succeeded, 84% failed.

However, all is not doom and gloom.

Earlier this month, in the cases of Bury Metropolitan Borough Council v Hamilton and others and the Council of the City of Sunderland v Brennan and others, the Court of Appeal rejected a challenge made by the Councils to a Tribunal’s finding and upheld the original decision made by the Tribunal.

Female council workers (including caterers, cleaners and carers) compared themselves with male council workers (including gardeners, refuse collectors and drivers). Although the female claimants received the same basic pay as their comparators, their overall pay was less because of productivity bonuses which were paid to the male workers.

Both the tribunal and the Court of Appeal found that the bonus schemes were genuinely intended to increase productivity when introduced.  However, the Council’s defence was rejected as the Court found in reality the bonuses were no longer linked with productivity which in turn meant they had become part of the males workers basic pay.

The Court said this was discrimination.

The Court of Appeal judgment is helpful for employees as it is clear that pay differences based on historical factors that no longer apply can be challenged, and it places employers on notice that such reasons should also be kept under careful review.

Anna Power - Solicitor

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

Have the Police and MI5 been helping companies to blacklist employees?

According to the Observer newspaper, David Clancy, investigations manager at the Information Commissioner’s Office (ICO) and a former police officer recently told the Central London employment tribunal that the police or security services are believed to have supplied information to a blacklist that has kept thousands of people out of work over the past three decades – a blacklist that has been funded by the country’s major construction firms. The newspaper has reported that Mr Clancy believed records that could only have come from the police or MI5 were included in a vast database of files held by a shadowy organisation known as the Consulting Association, covering about 3,200 construction workers, mostly targeted for their trade union and particularly safety activities.

Such allegations are given greater authority by the fact that the ICO is the UK’s independent authority set up to uphold information rights in the public interest, promoting openness by public bodies and data privacy for individuals.

This came out during an employment tribunal hearing concerning allegations by a number of these individuals against construction giant Carillion and other building firms alleging they have been denied employment and treated poorly because they were on the blacklist.

One of those individuals, Dave Smith, told the newspaper that "if managers on a building site don't like the fact that I am a safety rep because it affects their profit and their deadlines, then I understand why they might do it. I disagree with it, I think it is wrong, but I can understand, but for the police to be involved is appalling. This is the state linking up with big business basically, and any decent person in a civilised society would think it is appalling. This is about human rights. I have not done anything illegal; I am a member of a trade union. I have worked in an attempt to improve health and safety on building sites and yet it appears my employers, the state, security services and the police have been conspiring against me."

The Consulting Association was closed down and a 66-year-old private investigator, Ian Kerr, was fined £5,000 for administering the database, although the construction firms escaped prosecution.

Given the phone-hacking scandals involving newspapers and alleged close ties with the Metropolitan Police, these allegations by the ICO investigations manager, if true, appear to indicate a murky world operating between the state and big business – query whether this is a rarely sighted tip of the iceberg? Do employers in other sectors of industry operate similar blacklists? How widespread are the links between business and the state? And just as importantly, is the Government going to anything at all about it?

David Sorensen - Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

If it ain't broke why try to fix it?

A few months ago David Cameron said that a businessman told him “I don’t care if the UK’s processes are more flexible than most European countries”, as it was cheaper to hire and fire in the US. The Prime Minister went on to say “that’s like saying we’re better than Italy at cricket. The real competition is the US and Asia. That’s why I want to deregulate and cut back on bureaucracy”.

Vince Cable chipped in saying “what we are doing here is hacking through the excessive red tape and regulation that prevents too many businesses from creating new jobs in the first place” along with “ambitious plans to deregulate and modernise employment relations”. However, within the same speech he admitted “the UK has one of the most effective and lightly regulated labour markets among developed economies”.

A few weeks ago Liam Fox continued the theme arguing for the wholesale “deregulation” of the labour market saying “it is too difficult to hire and fire and too expensive to take on new employees”.

I think we can safely conclude that the government’s aim is to deregulate employment law, moving away from what was previously employment protection, to employer protection.

Aside from political ideology, I believe there is no credible evidence to support this push for deregulation.

According to the World Bank’s ‘Doing Business’ rankings, the UK ranks 7th in the world for business ‘ease of operating’ out of a total of 183 countries, behind only, in order, Singapore, Hong Kong, New Zealand, the US, Denmark and Norway. Yes, that’s right; we are currently, according to the World Bank, the 7th easiest country in the world within which to operate a business. That’s before any of the government’s proposed employment deregulation kicks in.

On top of this, the OECD’s ‘employment protection index’ measures the procedures and costs involved in dismissing and hiring workers and employees across the developed world. Of the world’s 21 largest economies, the UK currently already ranks as the 3rd cheapest behind only Canada and the US. This means that out of the 21 major economies, the UK has the 3rd lowest level of employment protection and associated costs.

In contrast, in terms of increases in unemployment, Germany and the Netherlands, whilst having much higher levels of employment protection and regulation, have had smaller rises in unemployment. Also many would point to heavily regulated and protected German workers as being very productive and of course no-one can deny Germany’s current success.

There is no credible hard evidence supporting the government’s view that ‘hacking and slashing’ employment protection will fix the UK’s economic problems. Given the fact that many countries have much higher levels of employment protection, not least Germany, maybe the Government should take an alternative approach, by increasing employment protection!

Finally, given the most recent Employment Tribunal statistics, the government no longer seems to be banging the drum that ‘there are too many Employment Tribunal claims and so we must cut employment protection’. This is hardly surprising, given the fact that as reported in our last blog the latest quarterly statistics for the Employment Tribunal covering the period from July to September 2011, show there was an overall fall of 30% in new claims with a 41% fall in new multiple claims (such as for equal pay). Hardly an imperative for change!

David Sorensen - Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

All Change in the Employment Tribunals

We blogged in January about the introduction of Tribunal fees.

More changes lie ahead.

Firstly from 6th April 2012 the qualifying period for eligibility to claim unfair dismissal increases from 12 months to 2 years.

Employees who started work on or before 5th April will still benefit from the old rule.

But new employees will have to wait 2 complete years before they are entitled to make a claim for unfair dismissal.

That means 2 years of uncertainty in a job climate that is already filled with uncertainties for many.

But we’ve blogged before that Government seems to be deaf to the many well-informed arguments about this.

I was intrigued to see that the latest Tribunal statistics show that for the period July to September 2011, the number of new claims received by the Employment Tribunals dropped 30% compared to the same period in 2010.

30 per cent.

Our experience is that, given the difficult economic times, many workers are refusing to stick their heads above the parapet, and we suspect that that accounts in no small part for the drop off in Tribunal claims.

But what with new fees to pursue claims, and longer waiting periods before one is eligible to pursue them at all, and much political posturing about the importance to business of “cutting red tape” we have to pose the question: with the number of Tribunal cases dropping off sharply, is Government trying to fix something that isn’t even broken?

Paul Scholey - Senior Partner
 
For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.
 
 

In the Spotlight: Tribunal Fees

The Ministry of Justice has now published its consultation paper in relation to charging fees in Employment Tribunals. The Department is seeking opinions 2 proposals put forward in relation to the structures. It is, however, clear that fees will be introduced irrespective of any access to justice issues.

Both proposals divide claims into levels according to the potential complexity of the claim, with more straightforward areas of the law being level 1 (for example breach of contract and unlawful deductions from wages), level 2 claims for more complicated cases such as unfair dismissal and complaints in relation to failure to inform and consult under TUPE, and then the most complicated claims such as equal pay and discrimination are at level 3.

What this means is that it may cost £150 to issue a level 1 claim under option 1 or £200 under option 2. It is proposed that this fee will apply irrespective of the value of the claim. So what this means in practice is that an employee who is owed say £50 unpaid wages will have to pay 3 or 4 times the amount that he is owed in order to reclaim that amount. Employees who simply want a declaration as to their terms and conditions of employment will also have to pay this fee.

If option 1 is adopted, not only will the individual have to pay the £150 on issue, but if the case has to be determined at a hearing, they will then have to pay an additional £250 hearing fee.

Level 3 claims will have to pay £250 issue fee plus a staggering £1,250 hearing fee.

What that will mean in practice is that employees are likely to be dissuaded from pursuing low value complaints simply because the Tribunal fees will be more than they could expect to recover from a claim. There does not appear to be any proposal for a dispensation of the fee in such low value claims.

It is also likely to mean that employers will be taking a tactical approach to claims and may defend claims to a hearing on the basis that the level of the hearing fee that will have to be paid will again put individuals off continuing their claim and the claim is then more likely to be withdrawn.

So whilst the Government’s intention is to encourage early resolution of workplace disputes, the effect will simply be to prevent employees from pursuing complaints and access to justice will limited.

And what does “low value” mean? We’re sure that for the politicians £250 is no great shakes; but for many people it’s a week’s pay. But who will be able to risk (or simply, afford) £150 to try to recover £250. It’s the people who can least afford to take the hit, who will have to do so under the proposed regime.

Toni Haynes - Solicitor

For further information, please contact our Employment Rights team on 0113 245 0733