1 October 2014 - Important employment law changes
Just a few months after the extension of the right to request flexible working, 1 October 2014 sees the introduction of new “family friendly” rights, mandatory equal pay audits as well as the annual increase in the National Minimum Wage and improved protection from dismissal for reservists.
Time off work to attend ante-natal appointments
From 1 October, there is a new right for fathers, partners and parents to take unpaid time off work to accompany a pregnant women to up to two ante-natal appointments. Although there is no need for employees to satisfy any qualifying period of service before being eligible for the right, they will need to be in a “qualifying relationship” with a pregnant woman or her expected child and this covers the following:
- The pregnant woman’s husband or civil partner.
- The pregnant woman’s partner (including same sex partner) who is in an enduring family relationship with her and not a relative.
- The father of the expected child.
- One of a same sex couple who is to be treated as the child’s other parent under assisted reproduction legislation.
- The potential applicant for a parental order in relation to a child born to a surrogate mother.
If the husband/partner is not the father of the child, both of them will each have the right to time off.
Agency workers will also have the right to take time off but in addition to satisfying the relationship test referred to above, they must have done the same kind of job for the same hirer for at least 12 weeks.
Unlike the pregnant woman’s right to paid time off for ante-natal appointments, the new right is to unpaid time off, limited to two appointments lasting no more than six and a half hours each which is deemed sufficient time to cover travel, waiting and attendance at the appointment.
Employers can choose to (but don’t have to) ask the individual making the request to provide a signed declaration confirming that they have a qualifying relationship with the pregnant woman (or the expected child), that the purpose of the time off is to accompany the pregnant woman to an ante-natal appointment, the time and date of it and that the appointment is made on the advice of a registered medical practitioner, midwife or nurse.
It is important to ensure that line managers who may be dealing with requests for time off are fully aware of the new right because an individual who is unreasonably refused time off to accompany a pregnant woman to an ante-natal appointment can bring an Employment Tribunal claim. There is also protection from being subjected to a detriment and employees are protected from dismissal. Significantly, any dismissal is automatically unfair and no qualifying period is necessary.
So if you have not already done so, amend your Maternity policies and Staff Handbooks to refer to the new right as a matter of urgency and consider how you intend publicise the new right. Finally, note that the government has recently published helpful Guidance with more details, Time off to accompany a pregnant woman to ante-natal appointments - Employer Guide.
Mandatory equal pay audits
Where an equal pay claim is made on or after 1 October 2014 and that claim is successful, Employment Tribunals must order the employer to conduct an equal pay audit unless:
- The relevant information is already available from an equal pay audit which has been carried out by the employer in the 3 years prior to the Employment Tribunal ruling.
- It is clear, without an audit, whether action is needed to prevent recurrence.
- The breach found gives no reason to think there may be other breaches.
- The disadvantages of an audit would outweigh its benefits.
The Equality Act 2010 (Equal Pay Audits) Regulations 2014 provide that the audit must include relevant gender pay information, identify any differences in pay between men and women, identify the reason, as well as a plan to avoid breaches in future. The Employment Tribunal will determine which section of the workforce should be covered (or all of it), how long is given for compliance (at least 3 months), and then whether the employer has complied. If not, a penalty of up to £5,000 could be imposed, repeatedly if necessary.
Micro-businesses (fewer than 10 employees) and “new businesses” (broadly, one which is set up in the year before the claim is brought) will be exempt initially.
Mandatory equal pay audits will have significant implications for employers. An audit will be costly both financially and in terms of time, and could trigger more claims. Moreover, the employer will not only have to make the audit available to everyone whose gender pay information was included, but also publish a copy on its website for three years. Although to date, most of the equal pay litigation has involved the public sector this is no time for complacency in the private sector. Recent cases show that equal pay claims are gathering momentum in the private sector. Employers should consider their strategy now. Will it be better to avoid compulsory audits in the future – and publication of it to the world – by conducting a voluntary audit now? In practice this would need to cover the entire workforce, and its effect could be alerting staff to inequalities and potential claims. Or will it be to settle every equal pay case? What is certain is that employers need to look carefully at their pay practices as soon as possible. For further information on how we can help please see our previous article on this topic - Beware the new regime of equal pay audits.
Increase in National Minimum Wage rates
The new rates from 1 October 2014 are as follows:
- The standard adult rate (for workers aged 21 and over) increases from £6.31 an hour to £6.50, a rise of 3%.
- The youth development rate (for workers aged between 18 and 20) increases from £5.03 an hour to £5.13, a rise of 2%.
- The young workers rate (for workers aged under 18 but above the compulsory school age who are not apprentices) increases from £3.72 an hour to £3.79, a rise of 2%.
- The rate for apprentices increases from £2.68 an hour to £2.73, a rise of 2%.
Members of the Reserve Forces
The Defence Reform Act 2014 includes better protection from dismissal for reservists. On 1 October 2014, the two year qualifying period of continuous service to bring an unfair dismissal claim is removed. No qualifying period is necessary to bring a claim where the dismissal is because or principally because the individual is a member of the Reserve Forces. Also introduced from that date is a scheme for small and medium-sized employers to claim up to £500 a month from the Ministry of Defence for each full month that a reservist is away from work depending on the size/turnover/staff of the organisation.
UK Corporate Governance Code
On 17 September 2014, the Financial Reporting Council published a new version of the Code which applies to financial years beginning on or after 1 October 2014. Of particular interest is the provision for listed companies to include a clawback power in their executive share plans and bonus arrangements.