Monthly Archives: May 2017

Gather, Distribute, Process, Retain No Info!

3MonkeysIn terms of legal opinion on which others may place reliance it is often advisable to do away with the needle of innuendo and pick up the club of statement. In line with that adopted position, you are invited to consider the implications of the impending arrival of the General Data Protection Regulations (“GDPR”).

As the regulations have their origins in EU law, an immediate question is will they survive Brexit? The short answer is that even if the regulations do not survive intact post Brexit, the Government has confirmed that the UK will implement the GDPR when it comes into effect on 25 May 2018 because the UK will still be a member of the EU at that time.

The GDPR heralds the biggest shake up in privacy laws in 20 years and will have a seismic impact on the human resource data processing undertaken by employers and employment related entities.

There will be some fundamental changes to the current law and it is suggested that organisations need to be aware of those changes and should be actively developing a strategy for compliance ahead of the changes coming into effect in May 2018. This is especially because the cost for GDPR non-compliance has risen dramatically when compared to non-compliance with current data protection legislation, as the new fines will be based on a percentage of total annual turnover of a business in the previous financial year. It will become easier for individuals to claim compensation and group actions will be more likely.

THE KEY CHANGES…

As a minimum, the key changes for staff engagement purposes include:

Consent: No longer will it be sufficient to include in Contracts of Employment a blanket clause stating an employee is deemed to give consent to the lawful processing of their data. Instead, organisations will be obliged to demonstrate that consent has been explicitly given for each processing purpose of the data in question. Furthermore, the organisation will need to demonstrate the consent was freely given (potentially difficult in the master/servant relationship which is employment) and that the consent is “informed.” Also, the organisation will need to implement a mechanism for the withdrawal of such consent at any time.

Subject Access Requests: The information to which data subjects will be entitled under the GDPR is more extensive. The time for providing that information is reduced from 40 days to one month and there will be no longer be a right for organisations to charge a fee to provide this data.

Right to Erasure: Also known as “the right to be forgotten,” this is a new right where individuals can request that their personal data is permanently deleted in certain circumstances. This will cause organisations particular difficulties where personal files are held both centrally and locally (for example, by a line manager).

Right to Restriction: There are instances when organisations are obliged to restrict processing; this includes employee challenges to the accuracy of personal data. This could result in certain management processes being stalled.

Breach Notifications: Unless the breach is unlikely to result in a risk to the individuals concerned, organisations’ data processers will be obliged to notify the ICO of all data breaches without undue delay and, where feasible, within 72 hours of the breach.

DO WE NEED TO DO ANYTHING YET??

YES! 

Organisations could be forgiven for thinking that, as the GDPR implementation date (25 May 2018) is still the best part of 12 months away, and with Brexit looming, the matter can be left for now. But compliance with this legislation will require a good deal of planning and remapping of existing processes. The immediate steps for any organisation include:

  1. A comprehensive audit of existing systems and processes;
  2. Deciding whether additional personnel should be recruited to take on specific roles and responsibilities;
  3. Designing systems that will assist with GDPR compliance (including breach notification compliance);
  4. Identifying appropriate training for staff – for example, general awareness training for staff with more specific training for those with greater compliance responsibilities (including the IT Department and HR managers); and
  5. Reviewing and upgrading current Contracts of Employment and policies to manage risk.

We can undertake your audit and assist you with preparation for GDPR implementation. For a non-obligation consultation, please call a member of our team on 01604 871143 or email us on info@fgsolicitors.co.uk

5 minutes with Floyd Graham

SJB18326

1)   How has employment law changed over the last 5 years?

Employment law has changed in emphasis. There appears to be a focus on clarifying and simplifying legislation, whilst at the same time striving to make it easier for contentious matters to be resolved without the need for following a full legal process through to resolution by the Courts. With the right support, employers can now create the right blend of performance optimisation and risk management to suit their organisations.

2) How many employees do businesses need to have before they have an employment law strategy?

Even employers with only one employee have employment law obligations and mistakes can be costly! The strategy should focus on legal compliance first, followed closely by achieving enough lawful flexibility to manage the business profitably and efficiently.

3) What advice would you give our readers who need to reduce their headcount over the next 6 – 12 months?

Plan properly to ensure that you do not end up keeping the employees you should be losing and losing the employees that you need to keep! A bit of effort in the planning stage, and the right guidance will ensure that your selection decisions work for your business and that your process will withstand any objective scrutiny. It is important that exiting employees, and those being retained, accept that fair processes have been adopted as this is a crucial part of managing risk.

4) What advice would you give our readers that are planning to increase head count over the next 12 – 18 months? 

Firstly, evaluate and streamline your operational infrastructure to ensure that the increase in headcount adds value and does not just fill a vacancy that has arisen. Next ensure that your recruitment and selection process is capable of selecting the right candidates for the role not just in terms of competence, but also in terms of team fit. Miss-hires are costly! Lastly, spend some time getting the “on boarding” process right, after all your new recruit is not the only one who needs to make a good impression!

5) Finally, one of our readers has 35 employees. They have a member of staff who has been with them for 10 years, who has made significant career progression and is now Sales Director. However, the Managing Director has noticed a “different” person in the last 12 months and believes it would be in the best interest of the company for the Sales Director to leave. How does the Managing Director achieve this as quickly, cost effectively and amicably as possible?

As an advisor, I would be focused on establishing the reason for the change, after all for 9 of those 10 years he has been a good employee and has an invaluable historic working knowledge of the business. The reason could be linked to domestic circumstances, ill-health or becoming disillusioned with the work environment. An accurate assessment of the reason will greatly assist the decision on which “legal tools” are chosen to remove him. Commerciality and risk are the twin stools on which most removal strategies are based.

The law now permits the option of having a protected discussion with the employee to explain the Company’s position and to allow the employee to state his. If the differences are irreconcilable, a protected discussion is generally quicker than a formal process, but can be a more costly option. It is likely that a dismissal on performance grounds is likely to be contentious unless supported by significant evidence. If this option is chosen, great emphasis needs to be placed not only on the reason but also the process, which should be vetted beforehand to ensure that it is legally compliant. This is generally a longer route. Lastly, it may be less contentious and faster to restructure that part of the operation for which this employee is responsible and remove him on this ground. Again, if speed is of the essence, this option may be the most suitable. I note that the employee is a Sales Director and therefore prior to dismissing him, consideration should be given to safeguarding the business against post dismissal competition from him and protecting confidential information.

What’s Next For Employment Law – You Decide?

1622450 - thinker isolated over blueAll three major political parties have now published their manifestos ahead of the snap General Election to be held on Thursday, 8 June 2017, but what do the parties have in store for employment law?

The Labour Party was the first to divulge its plans in the document “For the Many, Not the Few,” which contains numerous pledges in relation to employment rights.

The Liberal Democrats followed closely with the release of its manifesto “Change Britain’s Future,” which includes an acknowledgement that they believe the Conservative Party will win the general election, but that the Liberal Democrats are the only effective opposition, particularly on issues such as Brexit.

Finally, the Conservative Party released “Forward Together,” which Theresa May claims “contains the “greatest expansion in workers’ rights by any Conservative Government in history.” 

We have covered some of the key points from each manifesto in relation to employment law below, but this is not a substitute for reading each manifesto in full, we also provide this update for information only and not with the aim of supporting any particular political party.

Brexit

Conservatives Labour Liberal Democrats
The Conservatives pledge to maintain all rights given to workers by European Legislation post Brexit, for example working time, annual leave, TUPE legislation and anti-discrimination legislation to name a few. Labour has also included a statement that it will ensure that all rights given to workers by European Legislation post Brexit will be protected. Similarly, the Lib Dems have made a pledge to unilaterally guarantee the rights of existing EU nationals in the UK. They have also stated an intention to remain part of the single market and to retain the right to freedom of movement as far as possible due to the vital role that EU workers have to play in the UK economy.


Human Rights

Conservatives Labour Liberal Democrats
The Conservatives have vowed to retain the Human Rights Act during the Brexit process, but would consider amendments to this in due course. Labour intends to preserve the Human Rights Act. The Lib Dems will oppose any attempt to withdraw from the Human Rights Act.


Workers’ Pay & Executive Pay Packages

Conservatives Labour Liberal Democrats
The Conservatives aim to increase the National Living Wage (which applies to workers aged 25 and over and is currently set at £7.50 per hour), in line with the current target for this rate to reach 60% of the median earnings by 2020.They have also pledged to curb executive pay by making executive packages subject to annual votes by shareholders and to commission an investigation into share buyback to ensure that this is not being used to artificially hit companies’ performance targets with the aim of inflating executive pay. Labour pledges to increase the National Minimum Wage for all workers over the age of 18 to the same level as the National Living Wage (currently £7.50 per hour). The National Minimum Wage is expected to be £10 by 2020 for all workers over 18. Labour also proposes to increase prosecutions against employers who fail to pay the minimum wage, and to reinstate the Agricultural Wages Board to monitor wages (and employment standards) in the food manufacturing, farming and fishing industries. Labour intends to reform the pay ratios for public sector employers, and those that bid for public sector contracts, to ensure that the maximum ratio between the highest paid and lowest paid would be 20:1. Labour pledges to abolish the 1% public sector cap on pay increases. Finally, Labour intends to work to close the ethnicity pay gap by introducing equal pay audits requirements on larger employers. The Lib Dems intend to establish an independent review of how to set up a genuine living wage and roll this out across central Government and where possible, across other public sector bodies. They would also call for larger employers to publish data on the number of workers earning less than the living wage and the ratio between top and median pay. They intend to end the pay freeze in the NHS and the 1% pay cap on other areas of public sector pay and to update wages in line with inflation. Finally, the Lib Dems would require binding public votes by Board members on executive pay polices.


Employment Status

Conservatives Labour Liberal Democrats
The Conservatives pledge to continue the current review of employment status and the “gig economy” with the aim to ultimately ensure that the interests of employees working in the traditional master/servant employment relationship are properly protected. Details on how this will be achieved have not been specifically defined. Labour vows to widen employment protection to provide workers with the same protection currently given to employees. In addition, Labour intends to modernise the law on employment status to include creating a statutory definition for “self-employed,” “worker” and “employee” and to crack down on the potential misuse of the self-employed status. Labour intends to ban the use of Zero Hours Contracts so that every worker will receive a minimum number of guaranteed working hours. Finally, Labour intends to support young people at work by creating a target that will see the number of completed NVQ Level 3 apprenticeships double by 2022. It intends to make apprenticeships more accessible to all, and would require the provision of annual reports on completed apprenticeships to monitor access into the workforce. Labour has pledged to maintain the current apprenticeship levy, but will aim to make this more flexible. The Lib Dems pledge to modernise employment rights to make them “fit for the age of the gig economy.” In addition they intend to stamp out the abuse of Zero Hours Contracts and create a right for workers to request a fixed-term contract. The Lib Dems intend to consult on introducing a right to make regular hours of work contractual after a period of time.


Family Friendly Rights

Conservatives Labour Liberal Democrats
The Conservatives have suggested they would introduce a new right for workers to take between 13 and 52 weeks off work to care for a family member who requires full-time care, and to return to the same job afterwards. This is an extension of the current right to take Dependant Leave, which only allows employees to take very brief unpaid periods off from work to deal with unexpected incidents or emergencies. There is also an indication that the Party will introduce a new right to Child Bereavement Leave. No details have been provided about the length of this leave and whether it will be paid or unpaid. Labour intends to increase the scope of the current 30 hours of free child care to cover all 2 year olds and will consult on the possibility of extending this to 1 year olds. Labour also intends to increase the Statutory Paternity Leave period from a maximum of 2 weeks to 4 weeks, and to increase the rate of Statutory Paternity Pay (which is currently set at £140.98 per week). Labour also intends to extend the period of Statutory Maternity Pay to 12 months from the current 39 weeks. Finally, Labour intends to consult on introducing legislation on Statutory Bereavement, however the full details of the scope of this have not yet been disclosed. The Lib Dems intend to provide 15 hours a week of free childcare to all 2 year olds and to children of all working families from the end of paid Statutory Maternity/Paternity Leave or Shared Parental Leave, with an ultimate aim to increase this to 30 hours. They intend to make the right to make a flexible working request and to take Statutory Paternity Leave a “day one” right as opposed to the current legislation that requires an employee to have 26 weeks’ continuous employment with an employer before gaining these rights. In addition, the Lib Dems intend to make the right to take Statutory Shared Parental Leave a “day one” right and also introduce a one month “use it or lose it” period for fathers to encourage them to take this type of leave.


Worker Representation & Trade Unions

Conservatives Labour Liberal Democrats
The Conservatives aim to improve worker representation at Board level for listed Companies by either nominating a Board Director from the workforce, creating a formal Employee Advisory Council to the Board or assigning specific responsibility for employee representation to a designated Non-Executive Director. Labour intends to repeal the Trade Union Act 2016, which covers specified turnout requirements and balloting requirements before industrial action and to replace this with a “sectoral collective bargaining regime.” Labour will also give all employees the right to receive union representation, guarantee all unions’ access to the workplace, only award public contracts to employers that recognise a union and look at introducing electronic balloting. Finally, Labour intends to launch a public enquiry on Trade Union blacklisting. The Lib Dems aim to encourage employee ownership by giving staff in listed companies with more than 250 employees the right to request shares to be held in trust for the benefit of the workforce. They would also continue the drive for Boardroom diversity by pushing for at least 40% of female boards in FTSE 350 companies and improving ethnic minority Boardroom representation.


Discrimination & Diversity

Conservatives Labour Liberal Democrats
The Conservatives intend to extend the scope of the Equality Act 2010 to cover discrimination against those suffering from mental health conditions that are “episodic and fluctuating” to cover people suffering from depression, anxiety and bi-polar disorder. Currently, the legislation provides that certain conditions are “deemed disabilities” such as blindness and cancer and protection is automatically granted. In other cases, an individual would have to demonstrate that they have a physical or mental impairment that has an adverse effect on their ability to carry out day-to-day tasks and that effect is long term. The suggestion is that a Conservative Government would potentially classify depression, anxiety and bi-polar disorder as “deemed disabilities” so that people suffering from these conditions are automatically protected under the Equality Act 2010.There is also a reference to incentives being offered to employers to employ vulnerable workers such as 1 year’s relief from Employers National Insurance Contributions. Finally, the Conservatives propose an extension to the current gender pay gap reporting regime, which came into force on 6 April 2017, by requiring employers to publish more data than is currently required. This scope of this has not been clarified. There is also a suggestion that race gap reporting could be adopted. Labour intends to enhance the Equality Act 2010 to make it easier to challenge disability discrimination at work. It would also consult on reform to the Gender Recognition Act and the Equality Act 2010 to better protect transgender people by changing the protected characteristic of “gender assignment” to “gender identity.” Labour intends to increase pay equality by introducing an independent body to ensure that the gender pay gap reporting obligations are complied with. The manifesto also provides a proposal to audit all proposed legislation to assess its potential impact on women before it is introduced and to strengthen protection for women against unfair redundancy. The Lib Dems aim to extend the current protection against discrimination to cover gender identity and expression and not just gender reassignment. They would also outlaw caste discrimination. The Lib Dems intend to extend the gender pay gap reporting scheme in the private sector to include a requirement to publish information on gender, ethnicity, and LGBT statistics. They would also require name blind recruitment in the public sector and encourage this in the private sector, and will aim to improve diversity in public appointments by including a presumption that every shortlist should include at least one black/ethnic minority candidate. Finally, the Lib Dems would guarantee the freedom to wear religious or cultural dress in the workplace.


Immigration & Modern Slavery

Conservatives Labour Liberal Democrats
The Conservatives aim to increase the Immigration Skills Charge from £1,000 per annum to £2000 per annum, which is levied on employers employing migrant workers. They will also review the application of the Modern Slavery Act to strengthen measures against exploitation of vulnerable workers. The Labour manifesto includes a statement that Labour is committed to working with Trade Unions to ensure there are fair rules to prevent exploitation of migrant workers. The Lib Dems aim to strengthen companies’ responsibility for supply chains to assist in tackling modern slavery.


Tribunal Fees

Conservatives Labour Liberal Democrats
The Conservative manifesto makes no reference to Employment Tribunal fees. Labour aims to abolish Employment Tribunal Fees (which were introduced in the summer of 2013) and extend the time period for bringing a maternity related claim from 3 months to 6 months. The Lib Dems also aim to abolish Employment Tribunal Fees (which were introduced in the summer of 2013).


Other Provisions

Conservatives Labour Liberal Democrats
The Conservative manifesto contains a suggestion that a Conservative Government will introduce a right to request unpaid time off work for training. It also covers protection for Occupational Pension Schemes whereby the Pensions Regulator will be given greater power to review acquisitions that could potentially have an impact on an existing Occupational Pension Scheme, and to issue fines and Director disqualifications to those wilfully leaving a pension scheme under resourced. Criminal sanctions are also being considered. Labour intends to introduce 4 new Bank Holidays to increase a worker’s statutory minimum holiday entitlement to 32 days per annum. The Lib Dems aim to provide more protection to NHS whistleblowers – specific details are lacking.