4 December 2006

NEWS

Smoking Ban to Come into Force on 1 July 2007

Following lengthy consultations, the government has announced that smoking is to be banned in all enclosed public places and workplaces in England from 1 July 2007.  Read more

Muslim Classroom Assistant Dismissed For Wearing a Veil in Lessons

Aishah Azmi, the teaching assistant who was unsuccessful in her discrimination claim against Kirklees Council after they asked her to remove her veil in the classroom, has been dismissed.  Read more

BA to Review Ban on Religious Jewellery

BA has announced that it will review its ban on religious jewellery following the much publicised and highly controversial decision against Nadia Eweida.  Read more

Employers Encouraged to Help Combat UK Skills Shortage

Tony Blair and Gordon Brown have urged UK businesses to make a joint effort with the government to develop the skills of the UK workforce.  Read more

UK Workers Suffering From Lack of Engagement

A global survey conducted by HR consultants Right Management has found that less than a third of UK employees (29 per cent) are fully engaged at work (compared with 47 per cent in Norway and 43 per cent in the US).  Read more

UK Now Heavily Dependent on Economic Migrants

A study by professional services firm Harvey Nash and the Centre for Economic and Business research shows that a massive £54.3 billion is contributed to the UK economy by professional and managerial workers from overseas.  Read more

More Than One Third of Workers Fear They Will be Unfit for Work by 60

A European Working Conditions survey has revealed that 36.5 per cent of UK workers believe they will be unable to do their job at 60.  Read more

TUC Seeks to Allay Fears Over Paternity Leave Changes

The TUC General Secretary, Brendan Barber, has tried to allay employer concern over changes due to come in to force under the Work and Families Act.  Read more

30 Per Cent Increase in Pay for UK's Chief Executives

A combination of strong corporate performance and an increase in bonus opportunities has resulted in the chief executives of the UK's top 100 companies taking home an average of £3 million in the last year.  Read more

LEGISLATION

Disability Equality Duty in Force from 4 December 2006

The general disability equality duty created under the Disability Discrimination Act 2005 comes into force on 4 December 2006.  Read more

New Tribunal Award Limits Announced

The annual increase in limits to tribunal awards has been announced.  The increases will come into force on 1 February 2007.  Read more

CASES

Employers who Cause an Employee's Illness Can Still Dismiss Fairly on Capability Grounds

The EAT has confirmed that the fact that an employer is wholly/partly responsible for an employee's incapacity does not mean that a capability dismissal cannot be fair.  Read more

NEXT HR NETWORK EVENT

Our next HR Network Event will be our half day seminar "Multi Topic Review of the Year" which is taking place in December.  A full list of HR Network workshops and seminars is available here.

NEWS

Smoking Ban to Come into Force on 1 July 2007

Following lengthy consultations, the government has announced that smoking is to be banned in all enclosed public places and workplaces in England from 1 July 2007. 

The announcement has provoked strong reactions.  The TUC general secretary Brendan Barber said: "The pubs, bars and restaurants will become healthier places to work overnight, and in the longer term fewer workers will fall ill or die as a result of second-hand smoke."

Though the announcement has received condemnation from many smokers, Health Secretary Patricia Hewitt has said: "The scientific and medical evidence is clear – secondhand smoke kills, causing a range of serious medical conditions including lung cancer, heart disease and sudden infant death syndrome "SIDS" in children.  This legislation will help to prevent the unnecessary deaths caused every year from secondhand smoke, and recognises that there is absolutely no safe level of exposure."

Regulations providing the detail of how the smoke free legislation will operate are being finalised following on from the consultation which ended on 9 October and will be laid before Parliament shortly.  For details of the matters the Government consulted upon, please click here to see our earlier Briefing.

Information and resources to support the introduction of smokefree legislation are available on the Smokefree England website.

Smoking is already banned in enclosed public places and workplaces in Scotland and a ban is due to come into force in Wales in April next year.  (The Times, 1 December 2006)  Back

Muslim Classroom Assistant Dismissed For Wearing a Veil in Lessons

Aishah Azmi, the teaching assistant who was unsuccessful in her discrimination claim against Kirklees Council after they asked her to remove her veil in the classroom, has been dismissed.

An Employment Tribunal ruled in October that a Church of England school's requirement for Ms Azmi to remove her veil was not contrary to the new religious discrimination rules.  A spokesman from Kirklees Council has now confirmed that the teaching assistant has been dismissed as a result of a disciplinary hearing following her suspension.

Ms Azmi's claim arose after she refused to remove her veil in front of children if there were male colleagues present.  As yet she has not launched an appeal against the Tribunal's decision or her dismissal by the Council.

The claim was a test case under the new religious discrimination regulations and was central to the national debate on multiculturalism in Britain.  (BBC News, 24 November 2006)  Back

BA to Review Ban on Religious Jewellery

BA has announced that it will review its ban on religious jewellery following the much publicised and highly controversial decision against Nadia Eweida. 

Ms Ewieida, an employee of BA, recently lost her internal appeal against BA's uniform policy which prevents her displaying a small crucifix over her clothes.  The decision provoked a campaign, backed by almost 100 MPs and 14 bishops, in support of Ms Eweida.

BA has indicated that the review of its uniform policy, which will seek the view of its employees, will aim to find a way to allow symbols of faith to be worn openly, for example on small lapel badges.  The decision has been welcomed by Ms Eweida's supporters.  The Archbishop of Canterbury commented that: "This is a most welcome development and a victory for common sense." 

BA currently allows Muslims and Sikhs to wear veils and turbans for religious reasons as these symbols are not practical to conceal.  Willie Walsh, BA's chief executive is keen however to demonstrate that BA is not "anti-Christian" and said it will aim to "examine ways in which our uniform policy will be adapted to allow symbols of faith to be worn openly while remaining consistent with the British Airways brand".  (The Times, 25 November 2006)  Back

Employers Encouraged to Help Combat UK Skills Shortage

Tony Blair and Gordon Brown have urged UK businesses to make a joint effort with the government to develop the skills of the UK workforce. 

Speaking at the CBI annual conference, Blair said: "To get the workforce of the future, we need to get the private sector working with the government.  We will only get the skills we need when we get the involvement from business.  There is a long way to go on that."

Brown reiterated the need for a government/business collaboration: "Government and business need to work in partnership – employees taking responsibility to upskill; employers offering time off; government paying for basic training."

The CBI agreed and revealed that it is in talks with the government about reinstating the individual learning accounts system, which enables members to undertake subsidised learning.  The system, abandoned in December 2001 due to abuse and claims of fraud, had 2.5 million registered members and 9,000 organisations registered as learning providers.  (Personnel Today, 29 November 2006)  Back

UK Workers Suffering From Lack of Engagement

A global survey conducted by HR consultants Right Management has found that less than a third of UK employees (29 per cent) are fully engaged at work (compared with 47 per cent in Norway and 43 per cent in the US). 

In the UK, dissatisfaction is most notable for those at junior management level and below, but the survey does indicate that engagement is a problem even at the most senior levels – only 47 per cent of chief executives, managing directors and board directors are fully engaged.

Length of service was also found to be a major factor in the levels of disengagement.  Lack of satisfaction or commitment was evident in three quarters of workers who had been with their employers for five years or more, compared to 57 per cent of workers who had been with their employer for less than a year.  (Personnel Today, 29 November 2006)  Back

UK Now Heavily Dependent on Economic Migrants

A study by professional services firm Harvey Nash and the Centre for Economic and Business research shows that a massive £54.3 billion is contributed to the UK economy by professional and managerial workers from overseas. 

Migrants' contributions, in the form of worker skills and consumer spending, mean that the UK's economy now relies on migrants.

The chief executive of Harvey Nash, Albert Ellis, said: "Economic migration has many detractors, but clearly what we are seeing here is unquestionably positive and beneficial to the UK as a whole.  In fact, the UK could not do without its influx of economic migrants."

Mr Ellis noted the NHS as an example of a UK sector now dependent on migrant workers: "The NHS takes many thousands of migrant workers – more than 30% of NHS nursing roles are held by migrants to the UK.  So the effect we are seeing is not a temporary blip – the UK is vastly dependent on its migrants to sustain its steady economic growth and will be for the foreseeable future". (Personnel Today, 29 November 2006)  Back

More Than One Third of Workers Fear They Will be Unfit for Work by 60

A European Working Conditions survey has revealed that 36.5 per cent of UK workers believe they will be unable to do their job at 60.

This means that UK workers are now in sixth place in the league table of those confident they will be able to do their current job at age 60, a dramatic drop from the coveted first place position held by the UK in the 2000 survey.

Though the UK figure is still below the EU averages of 39 per cent (of the 15 countries who were members of the EU in 2000) and 41.1 per cent (25 EU countries of today), it is still a disappointing figure when compared with the most optimistic country's 26.4 per cent (Germany).

The TUC General Secretary Brendan Barber has expressed his concern at the figures.  Referring to the increasing dependency ratio between workers and pensioners, he noted that "Britain is sitting on a demographic timebomb".  He said that the new age discrimination laws should be "a useful tool in ensuring older workers can continue to earn a quality living but also that the UK economy benefits from the energy and expertise of a valuable section of the workforce."

With an ageing workforce and an inevitable increase in state pension age, a report in the journal 'Hazards' has called for older workers to have a legal right to request flexible working patterns and for employers to develop "age management strategies" to minimise strains on health.  In addition, the report suggests that employers should consider requests for reasonable adjustments to the working environment to enable staff to work longer.  (TUC Press Release and BBC News, 24 November 2006)  Back

TUC Seeks to Allay Fears Over Paternity Leave Changes

The TUC General Secretary, Brendan Barber, has tried to allay employer concern over changes due to come in to force under the Work and Families Act.

The employer concerns, highlighted by a CIPD/KPMG survey, are in response to the proposed introduction of Additional Paternity Pay and Leave, as reported in last week's HR Briefing.

Mr Barber said: "Employers have nothing to fear from these modest proposals and much to gain.  Managing change is always challenging but if managed well these new rights will benefit business and service delivery.  And any move that enables working fathers to play a greater role in that first important year of their children's lives should be welcomed."

Emphasising that fathers will appreciate the ability to spend more time at home where they can get involved in the sharing of childcare, Mr Barber said: "…as a result they are likely to return to work with a much greater sense of work/life balance and a renewed commitment to their jobs".  (TUC Press Release, 24 November 2006)  Back

30 Per Cent Increase in Pay for UK's Chief Executives

A combination of strong corporate performance and an increase in bonus opportunities has resulted in the chief executives of the UK's top 100 companies taking home an average of £3 million in the last year. 

A survey of 1900 senior executives of 120 top companies showed that performance-related pay is continuing to rise faster than basic salaries, with average bonuses now worth 85 per cent of salary if the chief executives reach set targets, and up to 150 per cent if they exceed those targets.  Together with a 12 per cent rise in the FTSE 100 index over the year to July and total returns reaching 16 per cent over the survey period, it is clear that the rise in performance- related pay is the reason behind the chief executives' massive pay increase.

However, the windfall has raised concerns among shareholders at the widening gap between the wage increases of workforces and top executives.  Robert Talbut, chief investment officer of Royal London Mutual, said: "The concern is that there is insufficient differentiation between executives who deliver superior performance and those who are just benefiting from a good external environment.  While things are going well, investors find it more difficult to restrain remuneration.  But when times get less benign, the debate is bound to get more aggressive."

The FTSE 100 executives have also gained in the percentage rise in basic pay.  In comparison to their counterparts in small companies who have seen their salaries rise just 4.7 per cent to £350,000, the CEOs of the top 100 companies received a 7.1 per cent increase resulting in an average basic salary of £800,000.  (Financial Times, 23 November 2006)  Back

LEGISLATION

Disability Equality Duty in Force from 4 December 2006

The general disability equality duty created under the Disability Discrimination Act 2005 comes into force on 4 December 2006.  The duty under the 2005 Act will require public authorities to:

• Eliminate unlawful disability discrimination;
• Eliminate disability-related harassment;
• Promote equality of opportunity for disabled people;
• Take steps to take account of disabled persons' disabilities, even if this involves more favourable treatment than others;
• Promote positive attitudes; and
• Encourage disabled people to take part in public life.

In addition, under the Disability Discrimination (Public Authorities) (Statutory Duties) Regulations 2005, certain listed public authorities will be under a duty to publish and implement a Disability Equality Scheme outlining how they will fulfil their duties under section 49A.

Disability Discrimination Act 2005

Disability Discrimination (Public Authorities) (Statutory Duties) Regulations 2005  Back

New Tribunal Award Limits Announced

The annual increase in limits to tribunal awards has been announced.  The increases will come into force on 1 February 2007.  The new limits include:

• Increase in the compensatory award for unfair dismissal from £58,400 to £60,600; and
• Increase in a week's pay from £290 to £310.

The Employment Rights (Increase of Limits) Order 2006  Back

CASES

Employers who Cause an Employee's Illness Can Still Dismiss Fairly on Capability Grounds

The EAT has confirmed that the fact that an employer is wholly/partly responsible for an employee's incapacity does not mean that a capability dismissal cannot be fair.

The employee developed a stress-related illness which the Tribunal found was attributable to the conduct of one of her managers which was then exacerbated by the mishandling of her grievance. 

After a year of sickness absence, she was dismissed for incapacity in circumstances where the employee accepted, and the medical evidence showed, that there was no prospect of her ever returning to work.

The Tribunal held that the dismissal was unfair because the illness had been caused by the employer's unreasonable behaviour and because of that the dismissal could not be fair.

The EAT said the Tribunal had applied the wrong test.  The question of whether the employer is responsible for the employee's incapacity is relevant to (but not decisive on) whether it was reasonable for him to dismiss and in such cases it may be necessary for the employer "to go the extra mile" in finding alternative employment.

It is not the case that an employer can never dismiss fairly if it has caused the employee's incapacity.   If that were so, employers would have to keep employees on their books indefinitely if they were incapable of any work.  It pointed out that employees who have been injured by their employer as a result of a breach of duty will have a personal injury claim in the ordinary courts. 

Tribunals must resist the temptation through sympathy for an employee to grant by way of compensation for unfair dismissal what is in truth compensation for personal injury.

The fact that an employer is responsible for an employee's incapacity is relevant in assessing the reasonableness of the decision to dismiss but does not mean that the dismissal can never be fair.  It just goes into the balance when considering whether the decision to dismiss was a reasonable one in all the circumstances.  The fact that an employer is culpable may mean that more is required of it, for example, in terms of finding alternative employment. However, in this case, the medical evidence showed that the employee would never be able to return to work. On that basis the EAT found that there was nothing more the employer could do to facilitate her return to work and the dismissal was therefore fair.

Royal Bank of Scotland v McAdie EAT  Back

© Pinsent Masons 2006

This bulletin is not intended to be a definitive analysis of legislative or other changes and professional advice should be taken before any course of action is pursued.

Should you have any questions please contact your usual Pinsent Masons advisor, your local office (see below) or hrnetwork@pinsentmasons.com

National Head of Employment

Chris Booth