Tag Archives: contract

If hurricane Sandy came to your business?

We are always more vulnerable to the unexpected than we think. Not so long ago Croydon businesses (and others in the UK) were struggling with the after effects of riot and fire. Since then flood and landslide have upset a lot of UK businesses as we lurched from hosepipe ban and drought, to floods.
Many businesses had real trouble getting paid by their insurers after disaster struck – some of which was because they kept all their receipts and books in the premises that suffered the disaster! (Note to self — off site backups and storage are not optional.) Others simply didn’t have the kind of insurance cover they thought they had.

Hurricanes are not common in the UK, though we had the rare experience of trading through the 1987 hurricane which was centred at the top of the hill we lived on. Two weeks of power outages and phone outages taught us a lot about contingency planning, and we managed to muddle through somehow. Statistically it ought to be 100 years till the UK gets another hurricane that strong, but there is always something unexpected round the corner for business owners.

What are you staff plans for when disaster strikes? If we get snowed in, or floods take over the area, or transport strikes hit? What would happen if neither you nor your staff could reach your premises (or open them) for a fortnight? It’s a chilling thought for most of us, isn’t it?

The planning for the 2012 Olympics taught many companies that they could have people work from home, or change core hours, and still provide a service. It won’t carry you through if the whole country is off line (like the Eastern seaboard of the USA) but having a plan for what you are going to do about/with/for staff is a good place to begin.

Ask yourself:

1) Who could work from home? What equipment and arrangements would they need? Do we have them in place, or how quickly could we get them in place? Have we done a trial run?

2) What are we going to do if we can’t open our main place of business? Will staff still need to be paid if we don’t open? Do we have a plan to open somewhere else? Do our contracts allow us to designate holiday, lay offs? What are we entitled to do?

3) What if all or some of the staff can’t turn up? What if some do turn up, but very late after long and difficult journeys. Who gets paid? Who doesn’t? Can we set expectations?

4) What about parents whose children cannot go to school? Are they clear about dependants’ leave? Are you?

5) What if your business premises are not fit for use for an extended period of time? Do you have a plan to trade from somewhere else? Do you have insurance that covers you just for the cost of repairing your premises? Or do you have insurance that covers you for loss of revenue too? Check your policy — you may not have what you hope for.

6) If you have legal expenses insurers, do you have to check with them first before you can lay off staff or send them home? You may find you are not insured if you don’t get their sign-off. What happens if your insurers are not available? It’s time to check out the small print.

7) What are you going to do about health and safety? There comes a point when it is not safe to encourage people to travel to work/stay at work, etc. How are you going to judge when it is time to say enough is enough?

Many small businesses never recover from the financial losses of a disaster. Many big businesses only cope by calling on the resources of other divisions or companies within the group. Whilst disasters can be times of great camaraderie and heroism, they can also be times when businesses and jobs are swept away, never to return.

Our hearts go out to the people affected by the hurricane on the East coast of the USA. But it’s also a warning to us to be ready for the unexpected.

If you want more information on who is entitled to be paid when disaster strikes, click here

Annabel Kaye is Managing Director of Irenicon Ltd a specialist employment law consultancy

Tel: 08452 303050 Fax: 08452 303060
www.irenicon.co.uk
www.koffeeklatch.co.uk
www.balancingthebump.com
You can follow Annabel on Twitter

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TUPE or not TUPE

. . . or The pangs of despised Love, the Law’s delay

For the last year or so I have been talking about TUPE on a regular basis, both in teleseminars and in person. So far, no employee engagement, talent management or onboarding specialist has turned up.

Is TUPE seen as a completely unrelated discipline or as a simple compliance exercise? This may be why so many of the questions I deal with are around “What do we have to do?” instead of “This is what we need to achieve…”

Consultation

The consultation elements of TUPE are key to success or failure. There are two employers – the current employer (transferor) and the future employer (transferee). The law treats the two for most purposes as if they are one employer, but not at this moment. The transferor has to give elected employee reps information about the transfer, and to state what measures it is proposing to take (sometimes known as a “measures statement”), and the ‘measures’ it expects the transferee to take. The transferor is required to consult the employee reps about its ‘measures’ – with a view to seeking employee agreement to them.

Misconceptions

Often that the transferor fails to organise TUPE reps, believing that there is a ’20 person’ threshold to this requirement. That threshold is a redundancy one – it does not apply to TUPE. There is no statutory timetable for TUPE consultation unless more than 20 employees are at risk of redundancy and the redundancy thresholds are triggered. It can be tricky to do a good consultation exercise in no time at all whatever the law says. Many HR departments think they have to consult only on proposed changes to contracts (most of which would be difficult under TUPE anyway) whereas the ‘measures statement’ should cover changes to the contractual terms (such as pension schemes so far as TUPE permits) but also to non contractual arrangements (e.g. discretionary sick pay and bonus schemes).

Measures

The transferee is required by TUPE to provide their ‘measures statement’ to the transferor in good time so that the transferor can pass it on to the employee reps. Sometimes the transferor will even allow the transferee access to staff to begin their own consultation process. But there is no requirement for the transferor to allow personal contact or meetings with staff prior to the transfer date. If the two parties are rival contractors (rather than a situation of client outsourcing), there can be little practical motivation for the outgoing employer to invest a lot of time in the consultation process for outgoing employees. Some employers simply make an announcement and say “your new employers will tell you everything when you turn up to work for them”.

Compliance is not much of a goal

The real problem for the transferee is not legal compliance, which can be fairly easily achieved in most circumstances. Difficulties arise because the incoming employees are bringing with them the whole psychological contract they had with their existing employer, along with their own personal set of misunderstandings about their contractual and legal entitlements, their expectations of how they should be treated, and their memories of how they were. They will be adding to that psychological contract how they are treated during this process – by the transferee and by their soon to be ex-employer, the transferor It’s a potent mix that can result in three way tribunal claims, disaffected employees and a lot of wasted time and effort.

If the transferee is “allowed in” prior to the transfer, the consultation process can be a wonderful way to start to understand these issues, and to arrange to bring those individuals into their new employment relationship with a better basis for working together. At any point consultation can also be the time when a mini ‘skills audit’ is done to see what training is needed to properly induct the new team members. It can be a ‘getting to know you’ process and a ‘checking we understand the data’ process. Alternatively, you can make this process into: ‘This is where we tell you what we want you to know, and you just listen and obey’.

The spirit of consultation is often overlooked in the rush to compliance, and many highly motivated and resourceful individuals start working for their new employer confused, angry and resentful. It is an extremely hard thing for some people to be sent to work for someone they have never met, never applied to work for or indeed wanted to work for. We need to recognise that, and build our processes accordingly. This is the first opportunity you have to show them how your ’employer brand’ really works – are you going to fail?

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy.

Tel: 08452 303050 Fax: 08452 303060
You can follow Annabel on Twitter
www.irenicon.co.uk
www.koffeeklatch.co.uk
www.balancingthebump.com

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Every worker in the UK is entitled to statutory minimum paid holiday?

When the Working Time Regulations were first introduced in 1998 they created a legal right to a minimum amount of paid leave.   At that time there was a three month’s qualifying threshold. Later the three months threshold was removed and the basic holiday increased.

The threshold still lives on in the organisational memory – we still see contracts today that say you don’t get any leave during the first 3 months (or some other period) of employment. Whilst employers can prevent staff from taking leave during this period, they cannot prevent at least statutory leave from accruing.

So anyone on a short term contract of employment is accruing statutory leave whatever the contract says and should be able to take the paid leave during their employment or paid for any unused leave when they leave.

For more information on holidays

Tel: 08452 303050 e-mail: info@irenicon.co.uk
twitter: annabelkaye
http://www.irenicon.co.uk
Employment law with attitude
http://www.koffeeklatch.co.uk
http://www.balancingthebump.com

via Annabel Kaye’s blog at Ecademy http://www.ecademy.com/node.php?id=176767 by Annabel Kaye

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Don’t let compliance lock you down

Is your way of dealing with employment law to look at compliance and do that?   A lot of organisations do just that.   If minimum wages go up, pay goes up.  If statutory holiday goes up, holidays go up.   If maternity leave goes up, that goes up.  You get the picture.

This approach to employment law tends to go with a defensive model of HR.  The processes in the business are ‘locked down’ – often by HR – to prevent ‘mistakes’ or ‘employment tribunals’.     The whole focus of how employees are dealt with is on process compliance.   A lot of insurance based schemes effectively require it.  This has an effect on the organisation – locking it down to processes and timescales that make it hard to keep agile.    

Like a Sumo wrestler, the organisation ‘wins’ by keeping their weight low, making it hard to shift things and staying in the circle.  Sumo wrestlers who are pushed out of their circle lose their match!.   Attacking Sumo wrestlers stay low and use their weight and momentum to knock their opponent out of the circle.  

Is that what someone accessing your grievance procedure is experiencing?  Do people have to ‘hack your sytems’ to get anything done?

This model has its merits in organisations that don’t need to change very quickly, or need to negotiate every detail of their change with Unions or multi-tier boards.   As long as the organisation remains stable, it can work, but anyone who tries to wrestle the Sumo champion will find themselves outside the circle in another job!

Smaller organisations and more entreprenurial
organisations prefer to stay agile  and want to be free
of ‘process’.  Flexibility is a big thing for organisations
that are trying to grow fast and respond to their market.   

They can turn on a spot, and there is nothing they can’t do.  Their approach to employment law is not based on any kind of coherent decision.  They might be generous about one thing, under the legal minima about another, but they handle things as they go.  Of course, not everyone has the skills or the training to be that balanced or that flexible.   This can work if the organisation devotes a lot of time to training, communication and embodying their values, but it can degenerate into something where the people who are not emotional or intellectual gymnasts get hurt.    A lot of organisations appoint their first internal HR person when someone falls over and they or the organisation gets hurt.   There is a temptation to ‘do a Sumo’ on the entrepreneurial gymnasts.  The experienced HR practitioner will miss having systems and processes in place.  The temptation is to import the systems that existed where you were before.   Unless you figure out where the organisation really wants to be on employment law, you will soon be the corporate ‘No’ person.  The one who says, “Employment law says you can’t…..”

Organisations need to be able to adapt and respond to change.  Employment law is part of a bigger mix of ingredients, and should not be allowed to dominate the organisation’s thinking about people, any more than consumer law should make you refuse to sell a product (unless it is dangerous of course).  Most people are neither Sumo wrestlers or gymnasts.   They need to know fundamentals in order to perform their role, but they don’t usually want to be rooted to the ground or a high wire act!.    Employment law is not about demonising or criminalising behaviour (though some off the graph behaviour does belong in that category).  It is about setting codes and signals that let people know what is expected of them, when they are able to move freely and make their own decisions, and what fundamental rules  exist that really are not to be broken.

On the social dance floor, ordinary people can do great things, cooperating with their immediate partner and within a group.   They do this because they learn the fundamentals of the dance and the codes of the dance floor.

Social dancers are not show dancers, they are not athletes but people working and playing in co-operation (and sometimes competition) with a group.   Too many rules and the dancers melt away to dance somewhere else.  Too few and the egoists take over the dancefloor and destroy the flow.

Employment law is a powerful tool in the workplace.  Like the codes of the tango dancefloor it can be used to help the flow of work and relationships.   Our strength in the UK is our ability to make contracts that reflect our own organisational priorities.   We can choose to Sumo, do gymnastics, dance tango, or anything else and embody that into our contracts and handbooks.

And in the interests of equality, everyone can dance – here is a picture of a wonderful ‘disabled’ dancer.

The question I want to ask you today is:

Do your contracts and handbooks speak with the right voice for your organisation and set the fundamentals and codes you need for success? 

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy. Tel: 08452 303050 Fax: 08452 303060
Website : www.irenicon.co.uk     You can follow Annabel on twitter

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Filed under contract, employment law, employment tribunal, free stuff, www.irenicon.co.uk

How many bosses don’t read contracts?

A recent Which? Magazine survey suggested that up to 5.1m British workers have failed to read their employment contract properly.

How many bosses don’t read or understand the contracts they are issuing?

Which? make some great suggestions about what employees should do, but what should the boss do?

1. Read your contract! Are you prepared to do all the things it says you will do (if the situation arises)? If not, you should consider changing it. Being ‘in breach of contract’ can be a big problem and making promises in writing you don’t intend to honour just documents your failure.

2. Check the handbook – If your contract refers to a handbook, make sure you read this too, as its terms will also be binding

3. Ask questions – Do you understand your contract? Are there grey bits you just ignore? Do your staff? Ask them if they have read it and know what it means – that can be a shock!

4. Issue the documents – Some bosses keep contracts in a locked drawer and don’t issue them. If they are no good, get them changed, if they are good you need them out there doing what you need them to do.

5. Keep copies of the signed terms – You may need to show someone had a copy to make sure you chase up for signed copies and keep them locked away.

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I notice you paid too much notice

shutterstock_84794962I was helping a small employer recently. They had four short serving part-time staff who were contracted to hours and duties that really didn’t suit the customer or business needs.

We were sorting out ending the current contracts and offering new ones that mean the business could service its existing customers at times when the customers wanted service.

 

I was surprised to find that all four staff were on contracts that offered one month’s notice. Their statutory entitlement would otherwise have been one week.

Three week’s additional notice x four staff is another 12 week’s notice.

This is money that small and struggling business had to fund at a time of great financial hardship when the owner wasn’t getting paid at all.

Why were the staff on contracts that offered so much more than the basic entitlement?

I asked their boss. “Oh we had an HR consultant who told us this was best practise. We didn’t have enough money to get out contracts done properly so we just copied some we had from when we were employees“.

When it comes to money, an employment contract is what a court is going to make you do, come what may.

The commonest problem is contracting to pay money you can’t afford. This constant ‘gold plating’ or employment law by government, large companies and even advisors makes small employers frightened to take someone on.  They worry about being able to afford notice if things go wrong.

In times of high unemployment and economic uncertainty, let’s not add to employers woes.

If you want to take someone on:

  • anyone with less than one month’s service has no right to statutory notice
  • after one month statutory notice is one week
  • after two year’s service. It’s two weeks

There is no legal requirement to go beyond this. You may need to if you are recruiting someone who is in a job with longer notice, but that is something you negotiate, not something you are obliged to do.  If you are taking someone off the dole – you can get to longer notice later IF you want to.

It is important you set in writing out at the recruitment/contract stage that your notice is one week – otherwise you could get stuck with ‘reasonable notice’ which might turn out to be a month if they are monthly paid (or longer if really senior).  If you don’t sort out this simple step you will end up spending money you don’t need to.

If you’d like to know the real deal on getting yourself flexibility and not making commitments you can’t afford join one of our free teleseminars and start saving yourself money.

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy. Tel: 08452 303050 Fax: 08452 303060 www.irenicon.co.uk twitter/annabelkaye

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May 4, 2010 · 2:18 pm

Volcanic eruptions over pay?

It’s not just airline strikes that stops people getting to work.  Who gets paid? Who does not? What happens when staff can’t get to work through no fault of their own?  What if the Olympics stop play?  A transport strike?  Bad weather?

Who is entitled to be paid and for what?

The UK has a remarkably flexible labour market, and the answer depends on what type of contract you have got with your staff.  There is no general right for employees who don’t turn up for work to be paid, and if they are stranded and can’t get to work, you may not be obliged to pay.  Many employers do pay more than they are required to, but it is important to know when you are choosing to pay more, and when you have to pay.

Hourly paid workers

People who are paid by the hour are not automatically entitled to be paid for their absence.

Employees can ask you to allow them to take the day(s) as paid leave. You are not obliged to authorise paid leave retrospectively, but if you do so, make sure the holiday records are kept properly up to date. You cannot decide retrospectively to make this a day’s leave without the employee’s consent.

Salaried staff

There is an historic tradition in the UK (fading fast) that distinguishes between staff on annual or monthly salaries, and those on an hourly rate – the old ‘white collar-blue collar’ divide. Traditionally salaried staff are not paid by the hour, do not receive overtime when they work more hours, nor receive a deduction when they work less.

These staff are viewed as being paid for service, rather than for the particular work performed. This group of individuals is generally entitled to pay unless the contract provides otherwise. You should check your contracts carefully. This applies even if no work is actually performed or where the employee is prevented from working due to factors beyond their control, as long as the employee remains ready and willing to serve the employer. Ready and willing would normally mean making an effort to get to work where it is safe to do so. Locally based staff who could have made it in would not be automatically entitled to pay if they did not turn up.

Many organisations no longer feel comfortable about having a two tier contract system, and increasingly have one single status contract that applies to all. So it’s possible your hourly paid staff may be in the same contractual position as salaried staff. A lot depends on what your contracts say.

Annual hours and flexi-hours contracts

Check the terms of your contracts – it may be that time not worked does not count for payment, and missed work will have to be performed at another time.

How long can this go on for?

Technically this is known as ‘temporary frustration of contract’. This is a situation when through no fault of employer or employee the contract cannot be performed.

During this period the contract is ‘on ice’ with no work being performed and no money being paid (unless the contract is set up in a particular way – see above).

Employers with time sensitive work to be performed may find themselves needing to get in other staff or contractors to do the work.  Call us if you are not sure if you need to pay your existing staff as well.

Are people going to be dismissed for absence?

Most employers are not going to dismiss people for a problem that is not their fault. However, some employers may feel they have no alternative but to “accept the ‘frustration” of contract if this goes on too long. “Accepting the frustration” means that the employer “accepts” that the contract has come to an end by operation of law. The law of “frustration” says that if the underlying basis of the contract no longer exists, the contract comes to an end. This is not technically a dismissal , though it has a similar effect.  Staff with less than one (two if they started after April 2012) year’s service will find there is not a lot they can do about this, unless their dismissal is related to some form of unlawful discrimination.

Employers will think long and hard before doing this, but for some organizations with time sensitive work there may be little choice but to find replacements.

Those who were wise enough to set up contracts that did not commit them to pay when no work is done will not have to consider accepting frustration at this point, but those with different contracts may, if this goes on, find themselves with little choice.

If you don’t know if you have to pay people  – send your contracts to us for a quick free review. – email to advice@irenicon.co.uk or fax them to us.

Annabel Kaye is Managing Director of Irenicon Ltd, a specialist employment law consultancy. Tel: 08452 303050 Fax: 08452 303060 Website : www.irenicon.co.uk. You can follow Annabel on twitter – http://twitter.com/AnnabelKaye

 

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