Sign in
Courtesy navigation
Search
Posts for July 2009
No more pay "that is not paid through the payroll"
July 30, 2009
The minimum wage is due to increase by £0.07 to £5.80 from 1st October. But more importantly for some businesses in the service industry is the plan to omit “that is not paid through the payroll” from the legislation.
For businesses in the service industry, this small edit to the law will have a more significant impact in two months time than the 7 pence increase, as the National Minimum Wage Regulations will have these words deleted, making it illegal to use tips to make-up the minimum wage.
While due to come into force on 1st October, the information is in no way easy to find. It is available on the Dept for Business, Innovation & Skills’ website, but tucked away in consultations – Government’s decisions on the treatment of tips & gratuities for the minimum wage, although it doesn’t get a mention on the Pay & NMW page, and the associated Business Link’s page only refers to current law, with no reference to these changes.
Small businesses that currently make use of tips to supplement the wages paid to staff need to ensure they’re ready for these changes, and with it being only two months, planning budgets should be well under way now.
The actual line of legislation that will come into force on 1st October, a draft of which is available from the Office of Public Sector Information simply states: ‘In regulation 31(1)(e) of the Principal Regulations (reductions from payments to be taken into account) omit “that is not paid through the payroll”.’ Simple, but very significant for a lot of businesses.
Have your say: government consults on plans to stop age discrimination when supplying services
July 28, 2009
Businesses have until 30 September to respond to a government consultation seeking their views on proposed laws to stop age discrimination in the provision of services, such as group holidays and special deals for particular age groups. The proposal is that providers of goods, services and facilities in both the private and public sectors should not be allowed to discriminate against adults aged 18 and over unless it can be objectively justified – that is it can be justified because it is a proportionate means of achieving a legitimate business aim. The main areas to be covered are:
- Health and social care services.
- Financial services.
- Other commercial services, including age-related holidays and special deals for particular age groups.
The consultation closes on 30 September 2009. Download the consultation document on the Equalities Office website.
When does performance management become bullying?
July 24, 2009
Ask an underperforming employee and many will say, setting targets, giving me warnings is bullying me. Ask their manager and they will say they are frustrated by the lack of performance .
They will tell you an employment law requirement such as warnings make their life difficult and impose unnecessary procedural burdens. Ask a high performing employee and they will say the setting of targets and giving of feedback is welcome and helps them improve their performance.
Employers have often failed to confront performance problems, or ‘square pegs in round holes’ and used transfers and ‘promotions’ to move employees out of critical performance areas. Until quite recently it was common to hear “he’s been here twenty years and he’s never been any good” as a long saga of under-performance and under management unfolded. Now underperforming staff are more likely to be ‘performance managed’ out of the business.
The practise of setting objectives, then warnings, then dismissal (if objectives are not met), can look like a fair and objective process. But, poor practise and a few rogue players are giving performance management a bad name, that in some organisations announcing that an individual needs to go on a performance improvement programme is tantamount to handing them their notice!
The setting of impossible goals (by over stating the goals or under resourcing what is needed to achieve it) is one of the behaviours identified as bullying. Not only will unrealistic goals undermine the fairness of any dismissal but they may also trigger claims of bullying. If these claims are linked to any issue of discrimination this can turn into a very expensive 'efficiency exercise'. Managers need to take care that their performance management and supervision is based on what can be achieved and offers adequate training, resourcing and support.
Health and Safety Executive warns against poster scam
July 24, 2009
The HSE has warned businesses to be on their guard against buying unnecessary and over-expensive new health and safety posters following recent changes in health and safety law requirements. The HSE has issued new versions of the health and safety law poster and pocket card that must be displayed in workplaces or given to workers. Businesses have until 5 April 2014 to replace existing poster and cards. It is asking businesses to tell the HSE if they are approached by unscrupulous commercial suppliers of posters and cards, who tell them that their posters/cards must be replaced now and/or offering overpriced copies.
New Law Society guide helps businesses conclude deals by email or fax
July 23, 2009
Businesses that sign (or ‘execute’) contracts and documents virtually, using email or fax, can now refer to a new Law Society guide on how to avoid the legal problems that can arise. The guide, 'Guidance on execution of documents at virtual signing or closing', sets out suggested ways to deal with electronic or virtual execution of simple contracts:
- The parties email or fax the contract to each other. The signature page is printed and signed at each end. Final versions, including the signature page, are circulated afterwards.
- Signatories can email signed signature pages for a final document, and give authority for these to be attached to the final approved version of the document.
- Signatories can email signed signature pages before the final document, and give authority for these to be attached to the final approved version.
The guide specifies the steps required for each (including that all the parties’ lawyers agree in advance which route to take, and that all documents are Microsoft Word or Adobe .pdf files) to make sure that the parties can prove the document was validly signed. While it is not legally binding, it provides valuable guidelines for company officers and their advisers. Only the first option can be used with other documents – such as leases or documents disposing of land, guarantees or other documents that have to be executed as deeds - but there are also additional legal formalities for deeds that mean they should not ordinarily be executed without legal advice in any event. Download the guidance at the City Solicitors website.
Swine flu just got personal
July 21, 2009
My three-year-old son is being treated for suspected swine flu. And this has really brought home how little we actually know about what to do in this situation.
Is it okay for my other son to go to his summer holiday club or his Tae Kwon Do class? What about myself and my husband going to work – will we be infectious? And how will our work colleagues feel about having us in the office?
In the absence of any official guidelines we’ve just used common sense. Of course we have to go to work – juggling looking after the sick child at home. And we’re keeping our other son away from other children as far as is reasonable for the next week or so until we know if he’s caught the bug too. But what advice is there out there and what do the rules say?
The Government and the NHS have issued some guidance on this and the National Pandemic Flu Service is due to be launched at the end of this week. But business owners should be thinking now about what they can do to lessen the impact of swine flu and how to control the spread of infection. People will be infectious soon after they develop symptoms so it makes sense to raise awareness among staff of the signs and symptoms and the need for people to stay at home if they think they may have caught the bug. It also makes sense to promote an environment at work where staff that do become ill can go home and stay at home until they recover. And good hand hygiene is a must.
You should also think about business continuity planning. With the summer holidays upon us you may find yourself very low on staff if half the office are away on holiday while the other half are at home with swine flu or looking after a dependant with the virus. The Gov.uk has advice on general business continuity planning as well as specific information on planning during a flu pandemic.
Re-visit your policies on sickness absence and SSP. If you don’t currently have a policy in place for sickness absences now would be a good time to write one and make sure all your employees are aware of what is required of them, especially in the event of a swine flu outbreak among your staff.
Visit the Business Link.gov website for more information on your responsibilities as an employer and the legal requirements for record keeping. You can also download an Employer Helpbook for Statutory Sick Pay (PDF) from the HM Revenue and Customs website.
If your business hasn’t yet been hit by swine flu it is probably a matter of time. If you are well-prepared you can minimise the impact of staff absences and help prevent further spread of the virus.
New Code of Practice on privacy notices
July 20, 2009
Businesses will welcome new guidance from the Information Commissioner’s Office (ICO) on producing user-friendly privacy notices that comply with the law. Privacy notices set out how the information your organisation collects about someone – for example, because they complete a paper or online form - will be used.
Following a public consultation earlier this year, in the light of consumer research showing that half of consumers do not understand what they are signing up to when they fill in online and paper forms, the ICO has published a new Code of Practice that will help organisations provide more user-friendly privacy and marketing notices.
The guidance reminds businesses that personal information is required by law to be processed fairly, and a privacy notice should state:
- the identity of the organisation in control of the processing;
- the purpose or purposes for which the information will be processed; and
- any further information necessary, in the specific circumstances, to enable the processing in respect of the individual to be fair.
In addition, the ICO has produced a checklist to help small businesses decide if they need to provide a privacy notice to their customers (eg where customers do not already know who they are or what they will do with personal information, including disclosing it to a third party).
- Download the Code of Practice and small business checklist from the ICO website
A blind date ... with the law
July 17, 2009
When you operate a small business you need to have lots of different relationships with different people. Clearly, you have relationships with customers. You'll probably have a series of relationships with buyers. You will undoubtedly have varying relationships with prospects and contacts. There will also be key relationships with business advisors.
But there are few that as are important as good working relationship with a lawyer, which means that your choice of legal advisor is something that you need to get absolutely right. It’s not enough that your legal adviser has the skill and experience that you need. He or she also needs to be someone that can relate to you and your business.
Consider your first meeting with a new prospective lawyer as a blind date. You need to make sure you're comfortable with them and also that they feel that they can work successfully with you. Don't be afraid to ask questions - consider how they communicate, how they work, and also key business details (such as how their charges work and who will be working on legal matters when you're not actively meeting with them). It’s absolutely imperative that you “check out” your potential legal advisor properly. This is potentially one of your most important business relationships and could last years or even decades. It’s not enough that a potential lawyer will do the job. You need to be able to develop high levels of trust with this key person. I would even go as far as saying you should trust your instincts.
Just like a blind date, finding the perfect legal adviser might take a bit of time and effort. But rest assured that, it will be worth it in the long run and, who knows, it just could be find love at first site.
Case law: workers’ paid holiday rights while on long-term sick leave
July 15, 2009
Businesses must take note of a recent decision of the House of Lords, applying a European Court of Justice (ECJ) ruling on the holiday rights of workers on long-term sick leave.
In this long-running case, all the workers had been employed by HM Revenue & Customs (HMRC), and brought proceedings under the Working Time Regulations 1998 (WTR) for unfair dismissal. Earlier this year, the ECJ ruled that a worker is entitled to paid annual leave during the time that he has been on sick leave; where he remains unable to work until the end of his employment relationship, he is entitled to an allowance in lieu of the paid annual leave, to be paid at his normal rate of pay.
Giving its decision in this case, the House of Lords overturned the decision of the Court of Appeal from 2005, and ruled, in accordance with the ECJ ruling, that the workers were entitled to be paid for annual leave that accrued while they were on sick leave, on the basis that their claims for failure to pay under the WTR could be treated as a claim for unlawful deduction from wages under the Employment Rights Act 1996, which provides for a longer time-limit for bringing a claim. While this decision will inevitably increase costs for employers who find themselves in this situation, businesses must not be tempted to dismiss employees on long-term sick leave or they risk facing claims of unfair dismissal and, potentially, disability discrimination.
Important message from Law Donut HQ
July 14, 2009
We are now reaching the final stages of preparation for the build of the Law Donut website, and getting very excited about it too. Law Donut is due to launch mid-August and, barring the whole company going down with Swine flu in the next two weeks, we are right on schedule.
While the Marketing Donut and the Start Up Donut may have got there first, the Law Donut is the one all the smart people are waiting for. Lawyers have a reputation for being scary, intimidating and tricky customers if you don’t know what you, or they, are talking about. The Law Donut will change all that forever.
A bold statement perhaps, but we at Law Donut HQ are confident that the sets of FAQs, toolkits, videos, interactive questionnaires and a whole host of other material on the site will enable small business owners like you to go to your solicitor armed with the information you need to make the most of their time (and your money).
The proof of the pudding (or should that be Donut) will be in the tasting and I’m already licking my lips…
Redundancy and unfair dismissal compensation payments to rise
July 13, 2009
From 1 October 2009, the maximum statutory amount that employers must pay for redundancy and unfair dismissal claims is due to increase.
The maximum amount of ‘a week’s pay’ for employees made redundant, or who succeed in a claim for unfair dismissal, will increase from £350 to £380 per week. The amount is usually increased in February each year, but next year’s increase has been brought forward to help employees being made redundant in the current economic climate.
As a result, the next annual increase of the amount will not be made until February 2011. In addition, Acas has recently updated its guidance on redundancy handling, which emphasises:
- the importance of planning labour requirements to avoid or to minimise the need for redundancies;
- the benefits of establishing an agreed procedure for handling redundancies; and
- the need for fairness and objectivity when selecting members of the workforce for redundancy.
The booklet also considers the practicability of offering redundant employees alternative work, counselling or other assistance.
- Download the ‘Redundancy handling’ booklet from the Acas website
Disciplinary procedures and redundancies
July 10, 2009
The new 2009 Acas Code of Practice on disciplinary issues says that it does not apply to redundancies, but Acas has updated its guidance on redundancy handling. Check out what businesses are doing to make sure redundancies are handled fairly.
Where a redundancy takes place entirely after 5 April 2009, you must now follow fair procedures, taking into account rules established by the courts over the decades, if you want to avoid claims that the redundancy amounted to unfair dismissal.
This means that you must:
- Identify a reasonable ‘pool for selection’, ie the group of employees from whom the employees selected for redundancy will be chosen.
- Adopt objective selection criteria and apply them fairly to the employees within this pool.
- Warn and consult employees about the potential redundancy situation.
- Seek a view from the union (if any).
- Inform and consult employee representatives in cases of collective redundancy (20 or more proposed redundancies at one establishment within a 90 day period), and notify the Department for Business Innovation and Skills (formerly BERR and, before that, the DTI).
- Allow employees to be accompanied at consultation meetings.
- Consider alternative employment for those employees whose roles are redundant.
- Give reasonable paid time off to look for work or make arrangements for training for future employment.
- Give redundant employees a right of appeal.
If you have your own company policy, and you are satisfied it is fair, it must be followed. The Acas guidance Redundancy Handling has been updated to help you. It reassures employers that the new procedure to be followed is similar to that under the recently abolished statutory disciplinary procedures. Many businesses are reviewing their redundancy policies, or introducing one, to take account of the new rules and the general requirement for fairness.
Law is dreadfully, dreadfully boring
July 07, 2009
If you run a small business and you cringe at the thought of having to do anything to do with legal contracts, terms of business, disputes, leases or anything else to do with the law, rest easy - you're not alone.
In my experience, the vast majority of people in business find most things legal to be complicated, boring, annoying or even a bit scary. So business people tend to do what humans like to do when things are a little uncomfortable: hide, ignore it, and generally avoid dealing with the uncomfortable stuff. I've been involved in many businesses both as an owner and as an advisor. But I've also been a practicing lawyer and I understand just how beneficial good legal "cover" can be in almost any business.
As boring, inconvenient or dry as it may be at times the reality is that getting your legal ducks in a row is one of the most crucial parts of running a successful business (new or established). You just never know what is around the corner, or what protection you might need.
At times it can seem that there is so much in the way of compliance, rules and regulations you need to worry about - and in a lot of ways, there is. But it’s also really important to remember that basically business is all about relationships. So when good relationships go sour, if you don't have your legal i's dotted and t's crossed, then you could be in big trouble. It's essential that you develop a great working relationship with a practical, business-minded legal advisor. That way, you can be assured that any legal queries you might have can be answered quickly and that the legal side of your business is water-tight. It also means that you can spend less time being caught up dealing with the legal issues, and get on to the fun stuff! Because really, that’s what running a business is all about.
Legal resources for you and your business - employment law, personal law and more | Law Donut
Copyright © 2009-2013
