19 November 2007

The environment in which companies operate is forever changing and employment law is no exception. From April 2008 employers will be faced with new regulations and the Government is already proposing a number of other new laws, not to mention developments in case law. Here’s what you can expect to happen next in the core HR areas.

Health and safety
The employer’s statutory duty to ensure health and safety will be bolstered by the Corporate Manslaughter and Corporate Homicide Act, coming into force on 6th April 2008. The Act does not in itself present any new obligations but does create a new offence, which will enable organisations to be more easily prosecuted where a breach of existing duties results in fatality. An organisation will be guilty of corporate manslaughter (or corporate homicide in Scotland) if the way in which its activities are managed or organised causes a death. The organisation’s conduct must be far below what would reasonably have been expected, so as to amount to a gross breach of a duty of care to the deceased, and a substantial part of that failure must have been at a senior level. If found guilty, the organisation guilty will be liable to an unlimited fine.

Pay and benefits
Although the increase to the minimum statutory holiday entitlement, from 24 days to 28 days, will not take place until April 2009, employers may be required to make other changes to their holiday rules much sooner. The ECJ ruling in HM Revenue and Customs v Stringer (formerly Commissioners of Inland Revenue v Ainsworth) is eagerly awaited, which will determine if employees on long term sickness are entitled to paid holiday in full or on a pro rata basis.  The ruling is expected to have wider implications for staff who are absent for other reasons e.g. additional maternity leave. 

At the beginning of the current parliamentary session the Government introduced a Pensions Bill to enact the remaining pension reforms set out in its White Paper “Security in retirement: towards a new pension system”. If the Bill is passed eligible workers will be automatically enrolled into the employer’s pension scheme unless they opt out. Employers will have to make a minimum contribution to the scheme, which is expected to be at least 3% of the employee’s salary, and employees are likely to be required to match their employer’s contribution.

Equality and diversity
Plans to harmonise and modernise the current legislative framework on discrimination through the introduction of a Single Equality Bill may have been postponed for a further year but changes are still afoot. 

The ECJ is expected to rule shortly on whether provisions under the age discrimination regulations, which allow employers to retire employees at the age of 65, is in breach of the European Equal Treatment Directive in the “Heyday” case. Plus, in Coleman v Attridge Law, the ECJ will rule on whether a person is protected from discrimination by their association with a disabled person, which would require amendments to be made to the Disability Discrimination Act.

Legislative changes are also due to come into force following the High Court ruling that the Employment Equality (Sex Discrimination) Regulations 2005 failed to implement properly the Equal Treatment Directive. Amendments are required to the provisions on pregnancy and maternity leave discrimination and the definition of harassment.

The issue of equal employment rights for agency workers has been dodged so far but discussions on the Temporary Agency Directive will continue next month at the EU Social Affairs Council. The TUC has stated that if negotiations fail at a European level they will call on the Government to introduce domestic legislation and the Temporary and Agency Workers Bill, which failed to get its second reading last session, may yet be re-introduced as a private members’ bill. Nonetheless the Government is committed to providing greater protection for vulnerable agency workers, including migrant workers. The newly introduced Employment Bill now in progress is expected to implement proposals in the Government’s consultation document “Protecting Vulnerable Agency Workers”, including giving agency workers the right to withdraw, without detriment, from services provided in connection with the work, such as accommodation. 

Employee relations
The Information and Consultation of Employees Regulations 2004 will be extended from April 2008 to cover business undertakings with 50 or more employees. Under these regulations employers are required to make arrangements for informing and consulting the workforce if a statutory request is made by its employees. The statutory provisions do not allow much flexibility and employers should consider introducing arrangements under a pre-existing arrangement before a request is made.

Following the recommendations in the Gibbons review, the Government’s Employment Bill is proposing a repeal of the statutory dismissal and grievance procedures and will enable replacement measures to be introduced, based on the outcome of the consultation paper "Success At Work - Resolving Disputes in the Workplace". The Government has indicated in the consultation exercise that it favours allowing tribunals to distinguish between dismissals which are unfair on procedural and substantive grounds. It is suggested that a lower penalty would be imposed, where there is a finding that a dismissal is procedurally unfair but substantively fair, rather than revert back to the “Polkey” rule where the dismissal is unfair but compensation is reduced.

Despite all these changes, employers have been given some respite. Draft regulations to implement provisions in the Work and Families Act 2006 increasing paid maternity and adoption leave to 12 months, and the new right to additional paternity leave, are not now expected to come into force until April 2010.

The much talked about Flexible Working Bill was dropped in the last session of Parliament, presumably because the Government gave a commitment to extend flexible working rights. The Government has since commissioned an independent review to consider the extent to which the current right should be extended, including any upper age restrictions of a child.  The outcome of the review is not expected until spring but the recommendations will eventually find there way to the statute books so keep watching this space!