Various developments in employment law

2 March, 2017
by: Cripps Pemberton Greenish

Employment law is always changing and there are several things going on at the moment.  Here is a summary of some of those developments.

Equality in the workplace

Last week we heard that Aviva had threatened to terminate contracts with suppliers that fail to promote women to senior roles, using its buying power to drive change.  The warning was aimed at suppliers that have failed to sign up to gender equality initiatives such as the 30% Club campaign. 

This week, Baroness McGregor-Smith’s Review into race in the workplace was published   In the Review the Baroness calls for the public sector to use its purchasing power to drive change.  She recommends that anyone tendering for public sector contracts should have to show what steps they are taking to make their workplaces more inclusive in order to be awarded the contract.   She urges employers with 50 or more employees to;

  • publish a breakdown of their workforce by race and pay band, on their website and in the annual report;
  • draw up five-year aspirational diversity targets and measure progress annually; and
  • nominate a board member to deliver on these targets.

This goes further than the 250 employee criteria for publishing gender pay gap data, which comes into force from April 2017.

The Government have responded stating that their preference is to rely upon pressure from investors to have a diverse workforce rather than legislation.  It will however monitor the progress over the next 12 months and “stand ready to act if sufficient progress is not delivered”.

A Business Diversity and Inclusion Group will be set up and chaired by Business Minister Margot James.  This will bring together business leaders and organisations and will include Baroness McGregor-Smith, Sir Philip Hampton and Dame Helen Alexander (who are leading a review aimed at increasing female leadership in FTSE companies) and Sir John Parker (who is currently leading a consultation on recommendations to increase Black Minority Ethnic (BME) representation in the boardroom).

Holiday and commission

The holiday pay saga has been making its way through the courts for a few years and I’m sure you will have all heard of Lock v British Gas.  For the full background read Chris’ blog.  The Supreme Court has now refused permission to appeal to British Gas and the case will go back to the employment tribunal to calculate the amount Mr Lock is owed.  Employees are entitled to be paid holiday pay based on both their basic pay and any commission they earn. Unison have however warned that because the decision is based on the Working Time Directive, which is a European Directive, it could be at risk as a result of Brexit.

Employment status

Employment status and the gig economy remain very much in the press.  Patrick wrote about the Uber case in November and Chris wrote last week about the Pimlico Plumbers. The Government is currently considering employment status issues as part of the Independent Review of Employment Practices in the Modern Economy.  Patrick attended one of the Matthew Taylor ‘Modern Employment Review’ events last week, getting involved with some interesting discussions on topics such as employability, enhancing skills investment for all and the mismatch between the tax regime and employment law around self-employment and worker status.  The Review is expected to publish in June this year.

Trade Unions

The Trade Union Act 2016 came into force on 1 March 2017.  The Trade Union Act prohibits industrial action unless there has been a ballot turnout of at least 50%.  This actually means that the industrial action will not be protected by law and so it can be stopped by obtaining an injunction.

An additional threshold of 40% of support to take industrial action from all eligible members must be met for action to be legal in some public services such as health, transport, education, boarder security and fire sectors.

Compensation limits: the new compensation limits have now been published and will come into force from 6 April 2017. There will be an increase to the limit on:

  • the compensatory award for unfair dismissal from £78,962 to £80,541; and
  • a week’s pay for the purposes of calculating statutory redundancy payments and the basic award for unfair dismissal from £479 to £489.

Both apply to dismissals where the effective date of termination is on or after 6 April 2017.