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November, 2007
Launch of Employee Benefit Audit
How employee benefits can help your organisation
Family-friendly rights put on hold until 2010.
The government has delayed its planned extensions to maternity and paternity rights.
Redundancy Consultation
The truth and nothing but the truth, but not necessarily the whole truth.....
Is the UK retirement age legal?
Under age discrimination law, employees can be retired compulsorily at age 65. A recent decision by the European Court of Justice has thrown some doubt over whether we comply with European law.
We are pleased to announce that we now have an Employee Benefit partner, Beckett Financial Services Ltd. We have taken this step to extend the range of services you can access via Picasso HR. An introduction to Employee Benefits has been added to our website here. To launch this new service our Employee Benefit partner Beckett Financial Services Ltd will be offering a free Employee Benefit audit. The aims of this initial audit are: - To ensure you have complied with relevant legislation e.g. Stakeholder Legislation, HSE Duty of Care Guidance
- To highlight any areas where your employee benefits may breach Age Discrimination Legislation
- To ensure your arrangements are good value for money
- To highlight what is working well and what could be improved
- To ensure you have established the right structure of benefits to match organisational objectives
- To examine the effectiveness of your employee communication’s around employee benefits
- To ensure that your healthcare and sickness absence arrangements are aligned
If you would be interested in an Employee Benefit audit please contact Lina Hogg at Picasso HR. We hope you will welcome this opportunity to review your employee benefits. We plan to include hot topics in the field of employee benefits in our newsletter on a quarterly basis. If there is anything that you would find of particular interest please let us know. We have several items already planned including more detail on the Government plans to introduce a National Pension Savings Scheme in 2012 which will mean compulsory pension contributions for all employees and employers.
On 1st October 2006 the entitlement to paid maternity leave was increased to 39 weeks, while paid statutory paternity leave remained at 2 weeks. At the same time, the government announced plans to extend maternity pay to 52 weeks and allow fathers to "share" up to 26 weeks of their partner's maternity pay. The idea is that the mother can return to work after 26 weeks and then the father can take a further 26 weeks paternity leave. This plan was due to be implemented in April 2009 but has been put on hold until April 2010 at the earliest. HM Revenue and Customs announced that the delay was made in order to "give employers some clarity and further time to make their preparations". However it's good to know that the delay is for the benefit of us employers and not simply because the government hasn't had time to work out all the details of what sounds like a fiendishly complicated scheme.
When UK Coal decided to close down Ellington Colliery with the loss of 329 jobs, they told the unions it was for safety reasons, due to flooding. In fact the closure was for economic reasons, but UK Coal thought that using the safety angle would allow them to get away with consulting for a shorter period than the law normally requires. When faced with a tribunal claim, the company argued that there was no legal requirement to consult on the reason for the redundancies themselves, only the outcome.
The background to the case is that under employment law, employers who are contemplating redundancies are required to consult with employees on the following:
- avoiding the dismissals
- reducing the number of employees to be dismissed and
- mitigating the consequences of the dismissals
In this case, the unions argued that it was not possible to consult adequately about ways to avoid dismissals where a whole site was being closed, without consulting about the reasons for the closure itself.
The definition of consultation, after all, is discussing with a view to reaching agreement on something - it's a bit difficult to reach agreement on something that's already been decided before you start, said the unions...
The case went to the Employment Appeals Tribunal, who agreed wth the unions. It has to be said that the fact that the original reason given by the company was untrue did not help their case.
The outcome for the company? A hefty bill for compensation for failure to consult adequately, and the dubious distinction of being one of those cases that will be famous for changing employment law.
The outcome for the rest of us? Any employer considering making any staff redundant will now be expected to consult with those staff about the business decision in the first place, as well as the implications arising from it.
It will also now be necessary to consult on the proposed reasons for the business decision before any final 'proposal' is confirmed in order for consultation about the reasons for the closure to be meaningful.
For advice on any aspect of redundancy, please contact us.
When the Age Discrimination laws came into force we at least knew we could retire someone at age 65 even if they didn't want to go. Well we thought we could. But Age Concern were unhappy with this state of affairs. Their view is that if we are serious about age equality it can't be right to force anyone to retire on the basis of their age. So they backed an organisation called Heyday to mount a legal challenge against the UK retirement age. To be honest, most people didn't give Heyday much hope of success. A few people who were forced to retire at 65 brought cases to tribunals but as long as the proper procedures were complied with the tribunals followed the regulations and threw the cases out. One gentleman, Mr Johns, asked the tribunal to "stay" his case (ie put it on hold) until the Heyday case has been decided by the European Court of Justice. The tribunal refused. Presumably they were mindful of the fact that Heyday isn't expected to be decided until early 2009, and they didn't give it much hope anyway. Well Mr Johns wasn't satisfied and lodged his appeal. Then just before the appeal was heard there was unexpected news from the European Court of Justice. They were hearing a challenge to Spain's compulsory retirement provisions. In Spain they do it differently of course so the case didn't directly relate to the UK. However the European judges decided that any State retirement provisions were subject to scrutiny on the basis that the State must be able to justify them on an objective basis. Now this doesn't mean that Heyday will win their case but the bookies have shortened the odds against them. And it threw enough doubt into the appeal tribunal's minds that they allowed Mr John's case to be "stayed". So does this mean that anyone who is compulsorily retired will be able to take a case to a tribunal and have it lodged there until Heyday is decided in 12 months time or so? At the moment the answer seems to be yes. A point to bear in mind if a compulsory retirement is on the horizon and the person doesn't want to go.
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