Top Stories
More redundancies expected due to gloomy economic outlook
The UK jobs market is facing its most difficult quarter since the recession, according to a survey by the Chartered Institute of Personnel and Development (CIPD). The Labour Market Outlook Winter 2011-2012 report, conducted by YouGov, indicates that nearly a third of employers plan to make redundancies in response to slow economic growth. Read more
Flexible working systems stress tested in advance of the Olympics
The largest-scale test of flexible working ahead of the London Olympics was carried out last week by Whitehall and businesses in preparation for the difficulties expected to arise throughout the games. Read more
Other HR News...
Campaign launched to protect unpaid interns from abuse
Any intern who undertakes work, with a duty to turn up and do the work and with set hours is usually entitled to be paid the national minimum wage, and be entitled to working time and holiday rights. However, the TUC and National Union of Students is concerned that interns are being exploited by employers who see interns as a useful source of free labour. Interns may well accept unpaid work placements due to their desperation to gain experience in the economic downturn. Read more
Attitude outweighs qualifications in graduate recruitment
A survey published by Ernst & Young has highlighted that a good degree from a respected university no longer guarantees students a job in the current climate of rising unemployment. Read more
Survey shows rise in recruitment in January
A survey of 400 recruitment companies has revealed that recruitment of permanent staff in the services, manufacturing and construction sectors rose modestly in January for the first time in four months. Read more
Government-wide review of bonus structures could extend to part publicly-funded bodies
Ministers could review the way part-publically-funded organisations issue bonuses as part of a wider investigation of bonus structures within the public sector, media reports have said. Read more
Shares awarded to employees in 'cash box' companies should be subject to income tax, tribunal rules
Shares awarded to employees in 'cash box' companies as part of an avoidance scheme are 'readily convertible assets' (RCAs) on which an employer must account for income tax under pay as you earn (PAYE), a tribunal has ruled. Read more
Cases
Post-employment victimisation not protected under Equality Act 2010
An employment tribunal has held that post-employment victimisation is not unlawful under the Equality Act 2010. Read more
Employee working abroad could bring unfair dismissal claim
The Supreme Court ruled that an employee who was working in Libya at the moment of his dismissal, but had employment links to Great Britain, would be protected under the Employment Rights Act 1996 (“ERA) and therefore able to bring an unfair dismissal claim. Read more
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Top Stories
More redundancies expected due to gloomy economic outlook
The UK jobs market is facing its most difficult quarter since the recession, according to a survey by the Chartered Institute of Personnel and Development (CIPD). The Labour Market Outlook Winter 2011-2012 report, conducted by YouGov, indicates that nearly a third of employers plan to make redundancies in response to slow economic growth.
The findings show that the net employment balance – which measures the difference between the proportion of employers intending to increase staff levels and those planning a decrease – has fallen from -3 last April to -8. This is the worst figure since spring 2009. Meanwhile, the twelve-month net balance, which offers a longer term perspective on recruitment and redundancy intentions, has also fallen from -2 to -6.
Worsening employment prospects are almost entirely due to a drop in confidence by the private sector. This is demonstrated by net private sector employment intentions, which have halved from +20 to +10 over the past three months. The figure for the public sector remains at -49.
There is expected to be an increase in redundancies rather than a drop in recruitment. Overall, 37% of employers are planning redundancies in the next three months, up from 33% last autumn. Within the private sector, 31% of service firms intend to make redundancies, a rise of 7% from the previous quarter.
Gerwyn Davies, Public Policy Adviser at the CIPD, explained the findings: "Whereas employers were in 'wait and see' mode three months ago, more private sector firms, particularly among private sector service firms, have decided to push the redundancy button in response to worsening economic news."
Mr Davies also highlighted the management challenges posed by changing employment prospects, adding: "...business leaders need to focus attention on communicating and consulting with staff to build trust and employee engagement in these uncertain times. Employees are likely to respond more positively to change, and even to the threat of redundancies, if they feel that they have a voice in the workplace and that senior leaders listen to their views before taking decisions."
The results of the survey also suggest a further widening of the north-south divide in terms of employment prospects. The net employment balance for the South of England has gone up from -4 to -1 over the past three months, with London the only region in the UK to register a positive score (+3). In contrast, job prospects in the North have fallen to -20 from -17 over the same period.
(Rise in private sector redundancy intentions contributes to worst employment prospects since the recession, CIPD; Outlook for jobs market worsens, Financial Times) Back
Flexible working systems stress tested in advance of the Olympics
The largest-scale test of flexible working ahead of the London Olympics was carried out last week by Whitehall and businesses in preparation for the difficulties expected to arise throughout the games.
Transport for London has spent months lobbying businesses to allow greater flexibility at work in order to reduce demand for the public transport network by a target 30 per cent. This is in addition to an £8.8m public campaign to encourage commuters to change their travel routines during the games. As well as the foreseen problems with transport, there are also concerns about other Olympics-related disruptions this summer, including possible cuts to internet access as an increased number of people attempt to access the internet.
Ben Dowd, O2's business director has accepted that it will be difficult for workers to get to work and indeed that working remotely would cut costs for the company, which has a 12,000 strong workforce. However, Peter Bishop, the deputy chief executive of the London Chamber of Commerce, has recognised that "you can get everything else right but, if you've got everyone working from home and they can't access their screens, then that's not very good". (Flexible working tests Olympics stress; Financial Times) Back
For more on the potential problems the Olympics pose for employers, see our previous coverage in HR Briefing (20 January 2012) and our London 2012 Olympics Update.
Other HR News...
Campaign launched to protect unpaid interns from abuse
Any intern who undertakes work, with a duty to turn up and do the work and with set hours is usually entitled to be paid the national minimum wage, and be entitled to working time and holiday rights. However, the TUC and National Union of Students is concerned that interns are being exploited by employers who see interns as a useful source of free labour. Interns may well accept unpaid work placements due to their desperation to gain experience in the economic downturn.
The use of unpaid interns is especially in popular career destinations such as journalism, advertising, film, television and public relations. As a result, a new campaign calling for the fair treatment of interns has been launched in order to ensure that "young people's enthusiasm and desire to work cannot be exploited". (TUC and NUS launch year of campaigning to protect interns from abuse; TUC Press Release) Back
Watch Nicola Johnston comment on this story in our HMRC campaign to lift lid on silent interns programme on HR Network TV.
Attitude outweighs qualifications in graduate recruitment
A survey published by Ernst & Young has highlighted that a good degree from a respected university no longer guarantees students a job in the current climate of rising unemployment.
Stephen Isherwood, head of graduate recruitment at Ernst & Young stated that the firm "interviews more than 3,000 bright graduates every year, but only about 25% have the all-round skill set". Graduates have been warned about becoming complacent and the need for them to develop their skills from school-level if they are to stand a chance of achieving their career aspirations. (Graduate attitude 'more important than degree', says survey; Personnel Today) Back
Survey shows rise in recruitment in January
A survey of 400 recruitment companies has revealed that recruitment of permanent staff in the services, manufacturing and construction sectors rose modestly in January for the first time in four months.
The findings by the Recruitment and Employment Confederation (REC) and KPMG also demonstrated that, although the hiring of temporary staff has contracted slightly in recent months, the latest figures show a small improvement on the December figures.
Kevin Green, the REC’s chief executive commented that the survey findings were “the first positive indicator for some time that employers are looking to hire staff despite the ongoing weakness of the economy”.
Despite the good news, most economists expect unemployment to rise further in the future. For example, Lloyds Banking Group said it would axe 990 jobs as part of 15,000 job cuts announced last year.(Rise seen in staff recruitment; Financial Times) Back
Government-wide review of bonus structures could extend to part publicly-funded bodies
Ministers could review the way part-publically-funded organisations issue bonuses as part of a wider investigation of bonus structures within the public sector, media reports have said.
Bonus arrangements at organisations such as the BBC, Channel Four, Royal Mail and the Met Office face scrutiny to ensure they are "fit for purpose" and provide "value for money for taxpayers," according to a report by the BBC.
For more information read our Out-law article. Back
Shares awarded to employees in 'cash box' companies should be subject to income tax, tribunal rules
Shares awarded to employees in 'cash box' companies as part of an avoidance scheme are 'readily convertible assets' (RCAs) on which an employer must account for income tax under pay as you earn (PAYE), a tribunal has ruled.
Although transferring the shares was not the same as a "payment of money", they fell within the RCA definition because they could easily be sold or converted to cash, the Upper Tax Tribunal said in its decision.
For more information read our Out-Law article. Back
Cases
Post-employment victimisation not protected under Equality Act 2010
An employment tribunal has held that post-employment victimisation is not unlawful under the Equality Act 2010.
The employee in this case was dismissed and brought claims for age discrimination and unfair dismissal. Following the claims being issue his former employer provided an unfavourable reference to an employment agency and the employee raised a claim for victimisation.
The Tribunal agreed that the reference had been provided as a result of the employee raising tribunal proceedings. This constituted an act of victimisation under the Equality Act 2010 (the Act). However, under section 108(7) of the Act, victimisation was not covered by the Act's post employment provisions. Therefore, the claim could not succeed.
This decision reflects a change in the legal position following the introduction of the Act. Previously, victimisation was defined as a form of discrimination and was prohibited post-employment. Nonetheless, it remains open to claimants to seek to rely upon the decision of the House of Lords in Rhys-Harper v Relaxion Group plc [2003] IRLR 484 to argue that section 39(4) of the EqA 2010, which concerns victimisation in employment, should be interpreted as protecting former employees.
Jessemey v Rowstock Ltd and another. Back
Employee working abroad could bring unfair dismissal claim
The Supreme Court ruled that an employee who was working in Libya at the moment of his dismissal, but had employment links to Great Britain, would be protected under the Employment Rights Act 1996 (“ERA) and therefore able to bring an unfair dismissal claim.
The employee, a British citizen, worked for the employer which had its registered head office in Scotland. In 2003 the employee transferred to a German co-subsidiary of the employer and his role involved working on a rotational basis, involving 28 days in Libya and 28 days in the UK. R’s salary was paid in sterling and he was taxed in the UK.
The employee tried to bring a claim for unfair dismissal. The Court held the employee was protected against unfair dismissal because he still had a “sufficiently strong connection with Great Britain”.
When assessing the facts the Court noted that the employee’s home was in Great Britain; his contract was stated to be governed by UK law; human resource matters were handled in Great Britain and he was treated as a commuter. Therefore, the question for tribunals to decide is whether the connection to Great Britain is strong enough, to displace the normal rule that the place of work is decisive.
Ravat v Halliburton Manufacturing and Services Ltd. Back
See our latest news stories on HR network TV
Racial bias among recruitment agencies
A new report indicates racism is prevalent among recruitment agencies during the hiring process (BBC report). Catherine Johns advises.
Departing employees and springboard injunctions
The High Court has granted an employer a springboard injunction to protect against unlawful competition. Jon Coley comments.
DDA - redeployment and "queue jumping"
Selwyn Blyth explains how redeployment in disability cases may amount to “queue jumping” ahead of non-disabled employees.
HMRC campaign to lift lid on silent interns
HMRC is planning a NMW enforcement campaign to tackle unlawful intern practices. Comment from Nicola Johnston.
Employment status: well drafted contracts not enough ...
Latest case law highlights the limitations of contracts when determining employment status. Ed Goodwyn advises.
Disability discrimination - reasonable adjustments
Recent case law highlights the need for employers to focus on outcome when making reasonable adjustments. Selwyn Blyth comments.
Feedback
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