Hand Morgan & Owen Employment Bulletin – September 2015
The interpretation of the Transfer of Undertaking Protection of Employment Regulations continues. Two developments took our eye.
For an employee to be protected upon a “service provision change” the Regulations require him to be “assigned” to an organised grouping of resources or employees. It has been decided that where an employee is permanently absent from work and is not expected to return but remains on the books, perhaps receiving some continuing benefits, he will not be protected by TUPE. So his contract will not move across to the new service provider. This contrasts with the position where an employee may be temporarily sick but expected to return.
The second issue relates to services provided by a sub-contractor. TUPE in relation to service provision change applies to contractors who provide services for “clients”. The Regulations, however, include sub-contractors in the definition of contractors. Where part of the service, therefore, is sub-contracted out careful consideration should be given to those employees who work for the sub-contractor. If the service provided by the sub-contractor is taken back in house then the contracts of the employees could well transfer automatically to the client. Definitely a situation in which legal advice should be taken.
COMPENSATION: TAXABLE OR NOT
The general principle is that damages or compensation awarded by a court or tribunal will not be taxable.
Notwithstanding this HMRC recently argued before the Tax Tribunal that an ex gratia payment of £600 in reality related to underpaid bonuses from previous years and therefore should be treated as earnings and taxable.
The Tribunal found that the compensation was paid to settle a race discrimination case and notwithstanding that the amount may have been calculated by reference to loss of income this did not make it taxable as earnings.
Cases continue to be decided in connection with an employee’s attire. There have been issues about the wearing of a cross for example. The latest of such issues is a Muslim lady who claimed that she had been discriminated against because she was told she could not wear a full lengthy jilbab because it was a tripping hazard. The prospective employer (the lady was undergoing a trial) asked her to consider wearing a shorter jilbab on the basis of health and safety.
The Employment Tribunal dismissed the claim saying that this did not amount to discrimination (indirect discrimination). It applied to all staff of all religions and if it more particularly affected a Muslim it was justified. It was a proportionate means of achieving a legitimate aim namely health and safety protection.
Restaurant tips have been in the news of late for a number of reasons. One is the practice of some employers keeping back a share of the tips towards expenses. Responses to the consultation have to be submitted by the 10 November 2015.
It is worth double checking that as an employer you are compliant since penalties are doubling and in response to criticism of a lack of prosecutions HMRC are assembling a team to concentrate on criminal prosecutions.
COMPANY CAR FUEL ADVISORY RATES
New advisory fuel rates for employers with company car schemes apply to all journeys made on or after the 1 September 2015.
If confirmation was required that the early conciliation procedure before presenting a claim to the Tribunal is mandatory we now have it.
A lady argued before the Employment Appeal Tribunal that because she had been, she said, sexually abused by her employer it was wrong in principle that she should be forced to conciliate through ACAS with that employer. The Tribunal, however, said “rules is rules” and it was a pre requisite to presenting a claim that the procedure had been adopted – even if it was likely to fail.
16 September 2015
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For advice and assistance in respect of Employment matters contact Nigel Pepper, Consultant or Patrick Nelson, Associate on 01785 211411.
The contents of this article are for the purpose of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.