8 Employment Myths Busted

We've clarified the truth on some of the most common employment law myths.

Myth 1: No employment contract exists if there is nothing in writing or signed.

Fact: Even verbal agreements are binding. An employment contract exists from the moment a job offer is accepted. Legally, an employer should within two months of an employee starting work, issue a written statement of terms and conditions of employment. However, if this document has never been issued a binding employment contract still exists between the employer and employee. Where terms are agreed orally, the situation is ripe for disputes.

Myth 2: Holidays start to accrue once the probationary period is successfully completed.

Fact: Holidays start to accrue from the first day an employee is employed. The existence of a probationary period will not affect a new employee's length of service or statutory employment rights.

Myth 3: Employees can say when they take their holidays.

Fact: Employees requests for annual leave can be refused by an employer for business reasons. However, when considering leave requests employers should also bear in mind the employees family responsibilities and entitlement to rest periods. Based on business needs employers can specify certain periods where annual leave can or cannot be taken. Employers should consult with employees at least one month before any holidays are due to commence. Employers are advised to agree with employees how and when employees should give notice of annual leave, ideally through an annual leave policy.

Myth 4: Employees on long-term sick leave should be left alone.

Fact: Although employers should not put undue pressure on employees who are on long-term sick leave, they are entitled to find out more information about the illness with the aim of establishing when and how the employee could return to work. 

Myth 5: An employee’s continuous service resets after moving roles within a company.

Fact: Moving roles within the same company does not ‘reset’ an employee’s continuous service.

Myth 6: Employees have the right to have bank holidays off work, or to be paid overtime for working them.

Fact: Employees are not automatically entitled to a day off or extra pay on a bank holiday. Any such right will depend on the contract of employment. Employees are entitled to 5.6 weeks annual leave per year, whether or not bank holidays are included as part of this leave will be up to individual employers.

Myth 7: An employee who is dismissed for gross misconduct is not entitled to pay in lieu for holidays accrued.

Fact: Regardless of the reason for dismissal, if an employee is dismissed part way through a holiday year, they will be entitled to pay in lieu of untaken statutory holiday that has accrued up to the termination date. Regarding holidays over and above statutory entailment, payment for these should be made unless the contract of employment specifically states that these days will be forfeited in cases of dismissal for gross misconduct.

Myth 8: The 10 keeping-in-touch days for employees on maternity leave, adoption or additional paternity leave and 20 shared parental leave KIT days are pro rated for part-time employees.

Fact: The legislation does not make provision for the 10 keeping-in-touch days or 20 shared-parental-leave-in-touch days to be pro-rated for part-time employees. For example, an employee on maternity leave who normally works only a three-day week is still entitled to 10 keeping-in-touch days.

BrightPay - Payroll and Auto Enrolment Software

Bright Contracts - Employment Contracts and Handbooks

Posted in Employee Handbook, Employment Contract

Reasons for not paying minimum wage

Last week the Government named and shamed 360 employers who are underpaying their employees. Top of the list was Debenhams were nearly 12,000 employees were short-changed.

Some of the more generic excuses for underpaying employees included:

• Pay is topped up with tips
• Wages were docked to pay for their Christmas Party
• Wages were docked to pay for their uniform

However, some more imaginative excuses included:

• “It's part of UK culture not to pay young workers for the first three months as they have to prove their worth first.”
• "I thought it was OK to pay foreign workers below the national minimum wage.”
• "She doesn’t deserve the national minimum wage because she only makes the tea and sweeps the floors.”
• "I’ve got an agreement with my workers that I won’t pay them the national minimum wage; they understand, and even signed a contract to this effect.
• "My workers are often just on standby when there are no customers in the shop; I only pay them for when they’re actually serving someone.”

The national minimum wage and national living wage (those over 25) will increase from 1 April 2017. If employers wish to avoid being named and shamed, they need to familiarise themselves with new rates and make plans to amend payrolls where necessary. 

National minimum wage rates from 1 April 2017.

BrightPay - Payroll and Auto Enrolment Software

Bright Contracts - Employment Contracts and Handbooks

Why your business needs contracts of employment

The contract of employment is one of the most important documents any employer will deal with, it is the cornerstone of the employer / employee relationship. Unfortunately however, this essential document is often neglected or feared, particularly by busy, small employers.

Below are some of the key points employers need to know about contracts of employment.

• A legal obligation: all employees must receive a written statement of their terms and conditions within two months of starting employment. Legislation sets out certain terms that must be put in writing:
• Name of employer & employee
• Date employment and continuous employment started
• Job location
• Pay and pay frequency
• Working hours
• Holiday entitlement
• Details of job and job title
• Details of any collective agreement
• Possible fines: in the event of an employment tribunal, if a business is found to have not issued a complete contract they could face a fine of up to a month’s pay.
• Employer Protection: additional clauses can be included in the contract that can protect your business’ interests.
• Short-time working or lay-off: if inconsistent demand for work is a factor in your business this clause may help you manage staff levels.
• Notice on termination: legislation requires employees to give their employers 1 weeks notice if they intend leaving employment. Would this be enough for your business to find alternative cover and schedule a proper hand-over? If not you can include longer notice periods in the contract.
• Confidentiality: if your employee will have access to confidential information or any trade secrets you may need to consider protecting the use of this information through a confidentiality clause.
• Restrictive covenant clauses: are you fearful that ex-employees might set up in competition to you, or work for a competitor, putting your business in jeopardy? If so, restrictive covenant contract clauses can help protect your business.

Having appropriate contracts of employment will not only ensure your business is legally compliant, but it will also make clear to employees what their rights are and what is expected of them, ultimately helping to protect your business in times of disputes or conflict.

BrightPay-Payroll and Auto Enrolment Software

Bright Contracts - Employment Contracts and Handbooks

4 Tips to Banish your Employee's January Blues

The third Monday in January has officially been reported as the most depressing day of the year, Blue Monday. Research also shows that the month of January has the highest rate of sick leave.

After the hype and excitement of December, January brings lighter bank balances, tighter waistbands, and overall melancholy that the fun and festivities are over for another her. So it’s not surprising that your employees will catch the “January Blues”, feeling tired, unmotivated, lacking energy and focus. However, the New Year is also a time for fresh starts, a time to plan and to set targets for the months ahead.

Here are our top tips on how to stamp out the January Blues in your workplace:

Generate enthusiasm

To help generate enthusiasm, you need something for staff to look forward to that will be energetic and fun. Why not introduce a team building event or social event? Something that will refocus the team, it’s upbeat and entertaining. Even a team lunch on a Friday afternoon will lighten the mood and enthuse staff to apply themselves.

Set targets

 Goal setting in January is a good idea. It allows you to set out plans for the year ahead and let your employees know what the key objectives for the business are – and how they will play a crucial role in achieving that. Along with setting Company goals, set individual goals, and team goals.

Recognition

A key factor in driving motivation amongst employees, is the feeling of being recognised for their work and achievements. Acknowledging employees for a job they have done well, will make them feel valued and encourages them to continue doing what they do effectively.

The impact of simply saying thank you, can go a long way. These two words, can have an overwhelming effect on employee engagement and productivity.

Workplace wellbeing

One of the most popular New Year resolutions people pledge, it to lose weight. The chances are several of your team will be looking to achieve this, as they are feeling sluggish from all the Christmas over-indulgence.

As we know, it’s important as an employer to invest in workplace wellbeing and fruit is a fantastic superfood that can help concentration and productivity levels. So why not show your support to staff and their resolution, by providing complimentary fruit platters for employees to enjoy.

The New Year is an opportunity to start fresh and achieve success. You need a fully focused workforce to accomplish this. Follow these top tips to help refocus employees and make 2017 a prosperous year.

BrightPay-Payroll and Auto Enrolment Software

Bright Contracts - Employment Contracts and Handbooks

SSP The Rules Made Simple

Here’s what you need to know about paying Statutory Sick Pay (SSP).

To be eligible the employee must:

• have started work. There is no minimum requirement period -it doesn’t matter how long the employee has worked for the employer.

• notify the employer within 7 days from the 1st day of sickness (or whatever is specified on the company sick pay policy) that they will be out of work due to sickness.

• be sick for at least 4 days in a row, known as the Period in Waiting (PIW). All days count towards a PIW including weekends and non-working days. PIW’s can be linked if there are 2 periods of sickness of 4 or more days in no more than 56 days or 8 weeks.

• earn enough money to qualify. They must have earnings at or above the NIC Lower Earnings Limit (LEL), currently £112 per week. If the earnings vary the employer would need to work out the Average Weekly Earnings , this is done over the “Relevant Period” of 8 weeks prior to the first day of sickness.

SSP will be paid for each qualifying day that the employee is out of work sick. Qualifying Days are the employee’s normal working days. The first 3 qualifying days of sickness will not be paid, these are called the Waiting Days. If PIW is linked, only period of Waiting Days needs to be served – if 2 waiting days are in the first PIW then in the second linked PIW only 1 waiting day needs to be accounted for. The daily rate of SSP is the weekly rate divided by the number of qualifying days; the weekly rate of SSP currently is £88.45.

If an employee is not entitled to SSP, the employer must give them a form SSP1 with the Part B filled in, indicating the reason for them not being entitled.

Records for SSP should be kept for a minimum of 3 years, as and per HMRC guidelines.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Review to be made on Statutory Sick Pay (SSP)

It has been announced by the Government, new plans to help people with long term conditions avail of the benefits of work and improve their health. Statutory Sick Pay will be reviewed as part of these new plans. The aim is that phased returns to work and supportive conversations will be encouraged.

The plans proposed are as follows:

• a review of Statutory Sick Pay and fit for work notes from GPs to help employees return to work quicker and for longer
• to encourage employers to engage with their employees that have long term health conditions to prevent the employees not returning to work
• a debate about recognising the value of work as a positive health outcome
• to encourage Jobcentre Plus work coaches to signpost claimants to therapy
• the launch of a consultation on Work Capability reform, the scheme that assesses claimants of disability benefits. 

The current government believes the system is not working that they inherited in 2010. They believe improvements have been made in the areas of supporting and encouraging employees that can work and for those that cannot, guaranteeing a safety net. Further work in the areas of extending fit notes from doctors to other healthcare professionals to help ensure employees receive more support and help making sure the system works for everyone and no one is disadvantaged.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted in Bright Contracts News

Are you up to date with family friendly leave?

Family friendly leave has developed significantly in recent years. Keeping abreast of what’s what can be challenging for employers.

BrightPay’s employment law experts have designed a free webinar for employers, which will give attendees an overview of Maternity, Paternity, Shared Parental Leave and Parental Leave how to process them directly through payroll.

The webinar will highlight frequently asked questions in relation to the leave types mentioned above, such as:

• Who is eligible?
• How employees apply?
• Pay and other benefits during family friendly leave.
• Managing family friendly leave efficiently and legally!

The webinar will give attendees a chance to ask any questions you may have, with an interactive Q&A session at the end of the webinar.

Places are limited for this webinar. Don’t miss out – book your place now!

If you cannot attend the webinar, don't worry – the webinar will be recorded and as long as you have registered you will receive a link to the recording afterwards.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted in Bright Contracts News, Events, Parental Leave

Auto Enrolment Spotlight on SMEs

The auto enrolment spotlight is now very much focused on small to medium businesses. Over 600,000 SMEs are due to enrol in the tax year 2016/2017.

Under automatic enrolment regulation, all employers must have suitable workplace pension arrangements in place to which they must contribute and automatically enrol eligible workers.

Every employer in the country has been given a staging date, by which they must have enrolled by. The advice to small employers is to know your staging date and start planning early. If you don’t already know your staging date it can be found here.

Key aspects of any planning stage will include:

• Review any existing pension scheme: if there is a pension scheme in place, does it meet the statutory requirements for auto enrolment?
• Choose a Pension Provider: as a small employer, will you opt to go with the National Employment Savings Trust (NEST) or will you shop around for a provider who may better suit your needs?
• Decide how to manage auto enrolment: managing auto enrolment does not have to be a nightmare, financially or otherwise. There are low cost options available to employers; for example BrightPay provides all automatic enrolment functionality as standard, simply process AE with your payroll. Further details on BrightPay’s auto enrolment offering can be found here. 

Although some policy decisions will be harder than others, small employers do not need to dread auto enrolment. Since the program’s roll out in 2012, many of the teething problems have been ironed out, and a number of rules have been simplified and relaxed. In addition, software solutions and support are now far better established, all of which mean SMEs can manage auto enrolment easily in-house.

In addition to the above planning stages, there are other concerns that the small employer may want to start considering:

• Data Quality: are your employee records up-to-date and correct? Incorrect information could result in an employee being enrolled or not enrolled incorrectly, putting your business at risk of breaching statutory obligations.
• Communication: regulations set specific communications which employees must receive from their employer. Are you familiar with these? Can your payroll provider assist you?
• New Employees: there is no qualifying period for auto enrolment, if a new employee meets the age and earnings limits they will need to be enrolled from their first day, even if they are on probation. If you have a probation policy stating the employees must have successfully completed their probation period before they are entitled to join a pension scheme, this will need to be reviewed. Some employers choose to postpone enrolment, this can be done for a period of 3 months, allowing employers the opportunity to assess a new employee.

AE can also pose questions in relation to your contracts of employment, and how different types of workers should be dealt with. Answers to these questions and more can be found here. 

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Dress Code - To heel or not to heel

A recent case  has brought the issue of dress code into the headlines. A temporary secretary started on her first day as a receptionist in the large Accountancy Firm Price Waterhouse Cooper, only to be told she had to go and buy herself a pair or heeled shoes as the flat shoes she wore were not deemed to be appropriate as they were not part of the dress code that the recruitment agency stipulated. She refused, stating that male employees did not have to wear heels so why should she. She was sent home without pay.

So this brings us to the question, how important is a dress code in the workplace?

The employer is fully within his rights to include a policy in the company handbook stating that employees must wear a particular dress code, i.e. smart, business-like attire or a uniform if there is one. If the employees are dealing with customers on a face to face level or representing the company in any way then it is especially important that the employees are seen to be dressed appropriately in neat and smart attire.

But can an employer make requests from one group of employees and not from another? Can an employer request that female staff wear heels over flat shoes? In this day and age and with all the advancements made for equality across all I would have to say no. But obviously there are some archaic ideologies still in practice out there.

Commenting on the situation, Rebecca Hilsenrath, chief executive of the Equality and Human Rights Commission in the UK, said: "Forty-one years on since the introduction of the Sex Discrimination Act, it's baffling that there are still some companies that are practicing this sort of outdated sexism."

"In our view, unless equally stringent requirements are applied to male workers, it is likely that a requirement to wear two inch heels would constitute unlawful discrimination, and we will look into whether action needs to be taken."

The employee in question has now set up a petition asking for it to be made illegal for companies to require women to wear the footwear for their jobs.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

New National Living Wage from 1 April 2016

From 1 April 16, a new National Living Wage will come into effect. The new Living Wage, set at £7.20 per hour, will be compulsory to all workers aged 25 years and above. This increase is part of an overall plan by the Chancellor that a compulsory national living wage of £9.00 per hour will be in existence by 2020.

In addition, the financial penalty payable by employers who underpay minimum wage rates will increase from 100% to 200% of the underpayment due to each worker. However, this will be halved to 100% if the fine is paid within 14 days.

Research shows that the higher wage rate will have the greatest impact in the retail and hospitality sector.

The question on many employers’ lips now is how to fund this increase. Reports suggest that there are three common coping mechanisms:

• Accept lower profits
• Reduce overtime and bonuses
• Reduce employee numbers through redundancy and/or slower recruitment

Other facts employers need to know include:

• Living Wage does not apply to self-employed
• Tips cannot be counted towards the Living Wage
• Living wage will apply regardless of geographical location, it is not just a London initiative. 

So regardless of how you will fund the new wage bill it is important that you make the changes come 1 April. Failure to do so could see your company facing hefty fines and being named and shamed. In October 2015 HMRC named 113 employers that hadn’t been paying workers fairly. As well as many small businesses they included fashion chain Monsoon Accessorize and outlets of sandwich chain Subway.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.