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Emplaw Monthly - End of March 2020

NEW FROM OUR AUTHORS

Furloughing employees - FAQs for employers on the coronavirus job retention scheme

A useful resource from Emplaw authors, Lewis SIlkin, incorporating  the latest updates (27th April) from the government on how furlough will work in practice under the new Coronavirus Job Retention Scheme

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Insolvent Employers, Redundancy, and Covid 19

Emplaw authors Parklane Plowden  set out what it means for employees when businesses fail, what are they entitled to, and how do they go about getting it.

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Free webinar on The Job Retention Scheme - Pensions & Benefits Issues

Free online webinar to download - recorded 15th April - from Emplaw authors, Gowling WLG

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FOCUS ON CONTENT

The Emplaw law card on the Written Statement of Employment Particulars has been updated by Emplaw authors Moorcrofts and explains clearly what information employers need to provide employees following the recent ERA Section 1 changes. This is part of the series of cards on Employment Contracts from Moorcrofts.

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NEWS

Employer/Advisor Need to Know

Suspension of enforcement of gender pay gap reporting

In the light of COVID-19 enforcement of the gender pay gap reporting deadlines have been suspended for this year.

https://www.gov.uk/government/news/employers-do-not-have-to-report-gender-pay-gaps

Off-payroll working extension to private sector delayed until 2021

The government has announced that in the light of the coronavirus crisis it has taken the decision to delay the extension to the private sector of the off-payroll working rules until 6 April 2021.

For employers and contractors wishing to continue to prepare ahead of 2021 and looking for the latest information, the HMRC Employment Status Manual is a very useful reference

https://www.gov.uk/government/news/off-payroll-working-rules-reforms-postponed-until-2021

https://www.gov.uk/hmrc-internal-manuals/employment-status-manual

Acas guidance on working from home

Acas has published new guidance on working from home.

https://www.acas.org.uk/working-from-home

COVID-19: Changes to DBS ID checking guidelines

Temporary changes to the DBS ID checking guidelines are being made as a result of the coronavirus crisis.

https://www.gov.uk/government/news/covid-19-changes-to-dbs-id-checking-guidelines

Proportionate approach to data protection practices during pandemic

The ICO has published a guide called Data protection and coronavirus: what you need to know

https://ico.org.uk/for-organisations/data-protection-and-coronavirus/

Rules on carrying over annual leave relaxed to support key industries during COVID-19

The Working Time (Coronavirus) (Amendment) Regulations 2020 provide that where it is not reasonably practicable for a worker to take some, or all, of the holiday to which they are entitled due to the coronavirus, they have a right to carry the 4 weeks under regulation 13 (the minimum  leave in compliance with the Working Time Directive) into the next 2 leave years.  An employer may only require a worker not to take such leave where the employer has good reason to do so.This will not apply to the additional 1.6 weeks leave under regulation 13A of the Working Time Regulations .

http://www.legislation.gov.uk/uksi/2020/365/made

https://www.gov.uk/government/news/rules-on-carrying-over-annual-leave-to-be-relaxed-to-support-key-industries-during-covid-19

Targets for the National Living Wage

Alongside the Budget (see more  below) , the government announced a new, ambitious target for the National Living Wage (NLW) to reach two-thirds of median earnings and be extended to workers aged 21 and over by 2024, provided economic conditions allow. Based on the latest OBR forecast, this means the NLW is expected to be over £10.50 in 2024.  

See page 4 of the Budget Report at

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/871799/Budget_2020_Web_Accessible_Complete.pdf   (page 4)

Policy paper on future UK/EU relationship

The government has published a policy paper of the future relationship between the U.K. and the E.U. and the U.K.’S approach to negotiations.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/868874/The_Future_Relationship_with_the_EU.pdf

Litigation and Legislation

Employment tribunal etc limits April 2020

The Employment Rights (Increase of Limits) Order 2020 has been published setting out the increases in compensation from 6 April 2020.

Subject of provision

Old limit

New limit

Amount of award for unlawful inducement relating to trade union membership or activities or for unlawful inducement relating to collective bargaining.

£4,193

£4,294

Minimum amount of basic award of compensation where dismissal is unfair by virtue of section 152(1) or 153 of the 1992 Act.

£6,408

£6,562

Minimum amount of compensation where individual excluded or expelled from union in contravention of section 174 of the 1992 Act and not admitted or re-admitted by date of tribunal application.

£9,787

£10,022

Limit on amount of guarantee payment payable to an employee in respect of any day.

£29

£30

Minimum amount of basic award of compensation where dismissal is unfair by virtue of section 100(1)(a) and (b), 101A(d), 102(1) or 103 of the 1996 Act.

£6,408

£6,562

Limit on amount of compensatory award for unfair dismissal.

£86,444

£88,519

Limit on amount in respect of any one week payable to an employee in respect of a debt to which Part 12 of the 1996 Act applies and which is referable to a period of time.

£525

£538

Maximum amount of “a week’s pay” for the purpose of calculating a redundancy payment or for various awards including the basic or additional award of compensation for unfair dismissal.

£525

£538

http://www.legislation.gov.uk/uksi/2020/205/schedule/made

The Social Security Benefits Up-rating Order 2020 increases statutory sick pay from £94.25 pw to £95.85. Statutory Maternity Pay, Paternity Pay, Adoption Pay and Shared Parental Leave increase to £151.20 from 6 April 2020.

http://www.legislation.gov.uk/ukdsi/2020/9780111192634/article/4

April 2020 - legislative changes

There is a reminder of  the April changes including Parental Bereavement Leave and Pay, changes to written statements of employment particulars and changes to agency workers' rights

https://archive.acas.org.uk/lawupdate

Consultations and reports

Consultation: carers leave

A government consultation seeks views on a proposal to give employees a week of unpaid leave each year to provide care. Consultation closes on 3 August 2020.

https://www.gov.uk/government/consultations/carers-leave

COVID-19

Links to advice on court hearings:

https://www.judiciary.uk/publications/civil-court-guidance-on-how-to-conduct-remote-hearings/

https://www.gov.uk/guidance/coronavirus-covid-19-courts-and-tribunals-planning-and-preparation

https://www.barcouncil.org.uk/resource/updated-guidance-on-attending-hearings.html

https://www.sra.org.uk/sra/news/coronavirus-update

https://www.barcouncil.org.uk/useful-information/coronavirus-advice-and-updates.html

https://www.supremecourt.uk/news/update-about-visiting-the-uk-supreme-court.html

https://www.gov.uk/guidance/hmcts-priorities-during-coronavirus-outbreak

Relevant key government interventions so far

The Spring Budget

The Chancellor, Rishi Sunak, presented the Spring 2020 Budget on 11 March.

The Budget announced a £12 billion plan to provide support for public services, individuals and businesses, whose finances are affected by COVID-19. This includes a £5 billion COVID-19 response fund to ensure the NHS and other public services receive the funding they need to respond to the outbreak as the situation develops, and recover and return to normal afterwards.

For individuals it includes extending Statutory Sick Pay (SSP) for those advised to self-isolate, and those caring for others who self-isolate, and support through the welfare system for those who cannot claim SSP, as well as a hardship fund.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/871799/Budget_2020_Web_Accessible_Complete.pdf   (page 4)

Coronavirus updates for employers/ employees

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19#history

https://www.acas.org.uk/coronavirus

https://www.who.int/docs/default-source/coronaviruse/getting-workplace-ready-for-covid-19.pdf?sfvrsn=359a81e7_6

Coronavirus Act and SSP

The Coronavirus Act 2020 has received Royal Assent.  It covers, for employment law purposes,  the right to take unpaid emergency volunteering leave and for amending statutory sick pay provisions (it provides for regulations to be made so that HMRC may fund SSP and to allow for  the temporary suspension of waiting days) where the illness relates to coronavirus. The provisions allow for retrospective implementation so that incapacity for work falling on or after 13 March will be covered.

The government has announced in COVID-19 guidance that the eligibility criteria for the scheme to reclaim SSP paid for sickness absence due to COVID-19 will be as follows:

  • the refund will cover up to 2 weeks’ SSP per eligible employee who has been off work because of COVID-19
  • employers with fewer than 250 employees will be eligible - the size of an employer will be determined by the number of people they employed as of 28 February 2020
  • employers will be able to reclaim expenditure for any employee who has claimed SSP(according to the new eligibility criteria) as a result of COVID-19
  • employers should maintain records of staff absences and payments of SSP, but employees will not need to provide a GP fit note. If evidence is required by an employer, those with symptoms of coronavirus can get an isolation note from NHS 111 online and those who live with someone that has symptoms can get a note from the NHS website

The government has also published The Statutory Sick Pay (General) (Coronavirus Amendment) Regulations 2020 which came into force on 13th March 2020.

Regulation 2(1) of the 1982 Regulations provides for categories of people to be treated as incapable of work for the purposes of claiming statutory sick pay. These Regulations amend regulation 2(1) to provide that a person who is isolating himself from others in accordance with advice on coronavirus disease is deemed to be incapable of work.

The government has produced an online service so that people unable to work for more than seven days can obtain an isolation note.

https://www.gov.uk/government/news/online-isolation-notes-launched-providing-proof-of-coronavirus-absence-from-work

http://www.legislation.gov.uk/uksi/2020/287/pdfs/uksi_20200287_en.pdf

http://www.legislation.gov.uk/ukpga/2020/7/section/41/enacted

 

Coronavirus job retention scheme

On 20 March 2020 the Chancellor announced a new Coronavirus Job Retention Scheme to help employees’ wages to be paid. The scheme enables employers to ask HMRC for a grant to cover up to 80% of a worker’s wages, up to a total o £2,500 per worker each month. These payments will be backdated to 1 March and will be initially open for 3 months, to be extended if necessary.

The website states that employers will need to:

  • Designate affected employees as ‘furloughed workers’ and notify employees of this change. It notes that changing the status of employees remains subject to existing employment law and, depending on the employment contract, may be subject to negotiation;
  • Submit information to HMRC about the employees that have been furloughed and their earnings through a new online portal.

Guidance has been published which states:

‘The Coronavirus Job Retention Scheme is a temporary scheme open to all UK employers for at least three months starting from 1 March 2020. We expect the scheme to be up and running by the end of April. It is designed to support employers whose operations have been severely affected by coronavirus (COVID-19).

Employers can use a portal to claim for 80% of furloughed employees’ (employees on a leave of absence) usual monthly wage costs, up to £2,500 a month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that wage. Employers can use this scheme anytime during this period.

The scheme is open to all UK employers that had created and started a PAYE payroll scheme on 28 February 2020’.

Any UK organisation with employees can apply. Furloughed employees must have been on the employer’s PAYE payroll on 28 February 2020, and can be on any type of contract, including:

  • full-time employees
  • part-time employees
  • employees on agency contracts
  • employees on flexible or zero-hour contracts.

The scheme also covers employees who were made redundant since 28 February 2020, if they are rehired by their employer.

To be eligible for the subsidy, when on furlough, an employee can not undertake work for or on behalf of the organisation. This includes providing services or generating revenue. While on furlough, the employee’s wage will be subject to usual income tax and other deductions. Employees hired after 28 February 2020 cannot be furloughed or claimed for in accordance with this scheme.

If an employee is working, but on reduced hours, or for reduced pay, they will not be eligible for this scheme and the employee should be paid through the payroll in the usual way.

Employers should discuss with their staff and make any changes to the employment contract by agreement. When employers are making decisions in relation to the process, including deciding who to offer furlough to, equality and discrimination laws will apply in the usual way.

Employers need to make a claim for wage costs through this scheme.

The employer will receive a grant from HMRC to cover the lower of 80% of an employee’s regular wage or £2,500 per month, plus the associated Employer National Insurance contributions and minimum automatic enrolment employer pension contributions on that subsidised wage. Fees, commission and bonuses should not be included.

At a minimum, employers must pay their employee the lower of 80% of their regular wage or £2,500 per month. An employer can also choose to top up an employee’s salary beyond this but is not obliged to under this scheme.

Under the Chancellor’s announcement, the next quarter of VAT payments will also be deferred until the end of the year.

https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses#support-for-businesses-through-the-coronavirus-job-retention-scheme

https://www.gov.uk/government/speeches/the-chancellor-rishi-sunak-provides-an-updated-statement-on-coronavirus

https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme

Help for the Self employed

The Chancellor has also announced help for self employed workers. He has guaranteed a direct cash grant of 80% of profits, up to £2,500 per month. The scheme will be called the Self-Employed Income Support Scheme, with those eligible receiving a cash grant worth 80% of their average monthly trading profit over the last three years. The scheme will be open to those with a trading profit of less than £50,000 in 2018-19 or an average trading profit of less than £50,000 from 2016-17, 2017-18 and 2018-19.

To qualify, more than half of their income in these periods must come from self-employment. The income support scheme, which is being designed by HMRC from scratch, will cover the three months to May. Grants will be paid in a single lump sum instalment covering all 3 months, and will start to be paid at the beginning of June.

https://www.gov.uk/government/news/chancellor-gives-support-to-millions-of-self-employed-individuals?utm_source=07409265-e5c2-4787-999d-6fd6e407a8f0&utm_medium=email&utm_campaign=govuk-notifications&utm_content=immediate

CASES: 

ICTS (UK) Ltd v Visram [2020] EWCA Civ 202

Interpretation of a provision about long term disability benefit

This case concerns the proper interpretation of a provision about long term disability benefit, which formed part of Mr Visram’s contract of employment with American Airlines (AA).

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Case Summary Tag: 

Pharmagona Ltd v Taheri & Anor [2020] EWHC 312

Interim injunction granted against an employee not to use or disclose confidential information

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Human Kind Charity v Gittens [2019] UKEAT 0086/18

Wrongful dismissal : employee investigating her own wrongdoing; the right to remain silent where it exists is not the same as saying something that is not true

This case concerns an appeal against a finding of wrongful dismissal and award of damages for notice pay.

Ms Gittens worked for Human Kind Charity, a charity working with drug and alcohol users. She was summarily dismissed on 16 May 2016.

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Case Summary Tag: 

Dawson-Damer v Taylor Wessing LLP [2020] EWCA Civ 352

Court of Appeal overturns High Court decision on ‘relevant filing system’

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Scott v LGBT Foundation Ltd [2020] EWHC 483

No breach of DPA 1998 when counsellor made disclosure to GP and Foundation not a public authority

This claim concerns the legality of an oral disclosure by LGBT Foundation Limited ("LGBT Foundation") of certain personal information concerning Mr Scott to his general practitioner (GP) on 25 July 2016.

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Allen t/a David Allen Chartered Accountants v Dodd & Co Ltd [2020] EWCA Civ 258

Sufficient state of mind for liability in tort for inducing a breach of contract

The issue raised on this appeal is what amounts to a sufficient state of mind to make a person liable in tort for inducing a breach of contract.
Mr Pollock worked for David Allen, an accountancy firm, as a business specialist. His contract of employment contained what appeared to be restrictive covenants. He was offered and accepted a job with a competitor, Dodd & Co.

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Royal Bank Of Scotland Plc v AB [2020] UKEAT 0266/18

ET wrong to conclude assessment of claimant’s capacity to litigate was not necessary

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Revenue and Customs v. Middlesbrough Football and Athletic Company (1986) Ltd [2020] UKEAT 0234/19

Weekly reductions in pay for cost of season tickets reduced pay for the purposes of NMW

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