The Most Expensive Sandwich in HR History?
Potentially the most expensive sandwich in HR history… was it filled with foie gras? Were there layers of lobster? Absolutely covered in caviar?
Well, no. It was a plain, ordinary sandwich by all accounts, coming well under the expenses limit. Yet this sandwich was integral to a Senior Banker’s dismissal (Szabolcs Fekete v Citibank NA 2023).
Fekete, a Senior Banker, put two sandwiches, two pasta dishes, and two drinks, on his lunch expenses during a work trip.
The quantity was suspicious, so he was questioned about this rather substantial lunch. Fekete responded to say the items were all for him and they were well within his expenses limit. He was hungry after skipping breakfast, the drinks were small, and the second sandwich was for his dinner. He asked why he was being put under scrutiny. However, the investigation continued, and Fekete later admitted some items were consumed by his partner, in breach of his employer’s Expenses policy. The Disciplinary procedure concluded with his dismissal.
Fekete then raised an Unfair Dismissal claim. He argued the sanction was unfairly harsh and had not sufficiently considered that he had been going through personal difficulties at the time. However, he lost the case as the Judge decided the dismissal was a reasonable response. The Judge’s conclusions emphasised that as a global financial institution, it was reasonable for Citibank to have high standards for honesty and ethical conduct.
If the Disciplinary Policy had been unreasonable, the case could have ended differently of course!
Bright Contracts clients have access to a comprehensive Employee Handbook, including a template Disciplinary Policy. Please contact us if you would like more information.
No More Excuses! Consequences of Not Providing Employment Documents
Excuses, excuses, excuses… there are many reasons why employers fail to provide legally required documents to employees. Unfortunately for employers who have failed in these responsibilities, excuses will not protect them from consequences including financial penalties and reputational damage.
In Cartmill v Always Transport and Others, the claimant Ian Cartmill explained he had not been issued with a written statement of his employment terms and conditions despite working as a Lorry Driver at Always Transport for over three years. On behalf of the respondent, Jean Murray admitted she had not completed this document as his ‘four days on and four days off’ shift pattern made it more difficult.
The Tribunal Judge stated that Ms Murray’s belief in the difficulty of completing the statement was ‘no real excuse’ and confirmed that Cartmill’s claim succeeded. Given the importance of drivers to the business, and ‘the absence of a credible reason’ for not providing the written statement, the Judge ordered an award of four weeks’ pay.
Likewise, in Mrs A Yeates v GT Plumbing & Heating Ltd, the respondent admitted there was ‘a lack of comprehension’ around HR practice. When the claimant Mrs Yeates joined the small business as a Showroom Manager/Designer, there was no employee handbook, and she did not sign an employment contract. Due to the failure to provide the written terms of employment, the Tribunal Judge ordered the respondent to pay the claimant the sum of £480.
Takeaways for Employers
It is essential to comply with the legal requirement to provide employees with written terms and conditions of employment within the required time limits. Excuses about difficulty or lack of understanding were not accepted in these tribunal cases.
Bright Contracts clients can quickly and easily create legally compliant terms and conditions of employment using the step-by-step instructions in our software.
Bright Contracts also provides a ready to go Employee Handbook which clients can tailor to their requirements. Policies and procedures are reviewed and updated in line with employment law changes and recommended practices.
Lay offs: What you need to know
As unpredictability in the global economy continues, company layoffs remain in the news. While layoffs may be necessary and appropriate, in many cases they cause more damage than benefit. Some leaders taken actions to reduce risks to company performance, reputation and long-term viability. What can we learn from these actions?
1. Be clear in the reason for layoffs
When it comes to lay-offs, some are strategic and forward-looking with higher valuations and others are focused solely on cost cutting. Examples of strategic reasons for lay-off include exiting less profitable sectors, products or markets due to changing customer habits. Businesses who are transparent regarding the reasons for layoffs see an increase in investor, customer and employee trust and engagement.
2. Use layoffs as a last resort
Most organisations that conduct layoffs do not see improved profitability, especially those that are highly reliant on innovation and growth. Leaders often underestimate the negative impact of layoffs on productivity, employee engagement, retention and brand reputation.
Effective leaders know that they should pursue all possible alternatives before embarking on layoffs, including temporary furloughs, redesigning jobs and work models, moving some workers to contractor status and offering more flexible benefits to create cost and operational flexibility.
3. Act fairly
Layoffs historically have had a negative impact on women and underrepresented employees. Recent news stories show the effect of layoffs among employees on maternity and health leave, as well as those in vulnerable positions with visas.
Reasons cited as acceptable for determining who is laid off include factors such as employee performance, tenure, experience and skill set. Effective leaders know that evaluating performance, skills and other factors is difficult and time-consuming, and that maintaining ongoing performance evaluation and review processes can position companies well for both ongoing and unanticipated events.
4. Know the people being laid off
Great leaders spend the time and thought required to understand not only who they are laying off but also why and the potential impact. They conduct workforce planning exercises using data science to understand employee performance, skills, networks and collaboration patterns to safeguard against losing key talent and creating unintended consequences.
5. Take responsibility and show appreciation
Leaders must ensure they take responsibility for layoffs and show appreciation for those impacted. They demonstrate their empathy and compassion through all communications. They understand their audience, allow opportunity for employees to process the information and share their feelings, and provide support and resources.
While layoffs are difficult for all involved, effective leaders handle them with care to avoid unravelling company purpose, culture and performance.
Employment Key Changes 2023: What is coming?
The year ahead see's changes to rates of pay, major reforms to EU law and details on the much-awaited Employment Bill.
1. Increased Rate Changes
The new year welcomed various rate changes. Here is what you can expect:
- National Minimum Wage / National Living Wage rates are set to increase from 1st April 2023.
| 23 years or older | Increase from £9.50 per hour to £10.42 per hour |
| 21 – 22 years old | Increase from £9.18 to £10.18 per hour |
| 18 – 20 years old | Increase from £6.83 to £7.49 per hour |
| 16 – 17 years old and apprenticeships | Increase from £4.81 to £5.28 per hour |
- Statutory maternity, adoption, paternity, shared parental pay. The rate of £156.66 per week will increase to £172.48 per week on 2nd April 2023.
- Statutory sick pay. The rate of £99.35 is set to increase to £109.40 per week. This increase is expected to occur on 6 April 2023.
2. Retained EU law (Revocation and Reform) Bill
The Retained EU Law Bill will repeal all EU law unless new legislation keeps it in place. The introduction of the Bill could see changes to:
- Transfer of Undertakings (Protection of Employment) Regulations
- The Working Time Regulations
- The Agency Workers Regulations
- Fixed-term Employees Regulations
- Part-Time Workers Regulations
- The Information and Consultation of Employees Regulations
- Various health and safety regulations
- Maternity and Parental Leave Regulations
3. Employment Bill
The much-awaited Employment Bill, mentioned in 2019, is likely to come in to force in 2023. The Employment Bill is said to include some of the following:
- Changes to the existing right to request flexible working. Employees no longer need 26 weeks of service to request flexible working; they can do so right away.
- Proposals to provide job security for new and expectant mothers for up to 6 months after their maternity leave ends.
- Introducing the right to receive up to 12 weeks’ paid neonatal leave for parents of babies needing neonatal care.
- Providing employees who are carers the day one right to receive one week’s unpaid leave per year.
- Allowing workers on variable hours the right to request a more predictable and stable work contract after 26 weeks’ qualifying service.
- Proposals making it unlawful for employers to withhold tips, gratuities and service charges from workers.
- Imposing a new duty on employers to prevent sexual harassment at work (extending to third parties). There are also proposals to extend the time limit for claims to 6 months.
Also in 2023, the Harbours (Seafarers’ Remuneration) Bill will come into effect, giving UK ports authority to deny access to ships that pay their crew members below the national minimum wage.
The Transport Strikes (Minimum Service Levels) Bill will likely take effect in 2023. It requires employers and unions to agree on a minimum service level during transport strikes for three months. It will also remove the automatic unfair dismissal protection available to employees who participate in strike action during that period.
Holiday Pay Calculations: Consultation Period
The government has issued a consultation containing proposals for legislative reform to address the challenges faced by many employers in response to the Supreme Court’s decision in Harpur Trust v Brazel last year.
Last year the Supreme Court ruled that all workers (including part-year and other irregular-hours workers) are entitled to 5.6 weeks’ paid leave per year, irrespective of the number of weeks worked, and that their holiday pay should be calculated in line with the relevant statutory provisions. Further details can be found here.
The key proposal in the consultation document is that the statutory annual leave entitlement for part-year and casual workers should be calculated in two steps:
- Calculate the total hours a worker has worked in the previous 52-week reference period, including any weeks without work
- Multiply the total hours worked by 12.07% to determine the worker’s total annual statutory holiday entitlement in hours
At the beginning of a leave year, an employer will be required to look over the total hours worked in the previous 52 weeks (including non-working weeks) and use that figure to determine the worker’s annual leave entitlement for that leave year.
How does this work for the first year of work or casual workers on short-term assignments? Employers will be required to work out a worker’s statutory holiday entitlement, in hours, on a monthly basis by reference to the number of hours worked in the previous month multiplied by 12.07%.
Agency workers are also covered by this consultation. When an agency worker is on assignment, their holiday entitlement should be calculated by 12.07% of the hours worked over the previous month. If an agency worker is not on an assignment, they will not accrue holiday.
The consultation document also proposes a new means of calculating how much of their holiday entitlement a worker uses when they take one day off. The suggestion is that employers calculate a flat average working day based on the average number of hours worked during the relevant reference period.
The consultation closes on 9 March 2023. Due to a short consultation period, it suggests that the government is keen to crack on with its proposals and that we can expect implementing legislation sooner rather than later if the proposals gain the backing of affected employers.
Related articles:
Case Law: Harper Trust v Brazel
The Benefits of Hiring Seasonal Workers
Seasonal workers are usually encountered in the tourism, hospitality, construction and agricultural industries, mostly in the summer months but they can also be hired in the lead-up to Christmas too to assist with the busy period.
Some may think that seasonal workers are unskilled and a lower-paid alternative to permanent employees, however, that is not the case. There are many benefits to seasonal workers such as:
- Meet business demand and customer expectations: seasonal employees provide you with the flexibility to increase the size of your team during peak trading periods so that you can continue to provide customers with the service they expect even during busy times.
- Improve morale for the permanent team: you can’t expect your permanent employees to start working double shifts or deferring their annual leave. It’s best practice to ensure that there is sufficient cover for this annual leave.
- Meets skills shortage: temporary workers can help fill the gap with a particular skill shortage during busy periods.
- Return year on year: many seasonal workers are happy to return to work for the same company each year- which is a win for both the employer and the employee.
Legal obligations as an employer
A temporary, seasonal worker hired under a fixed-term contract is entitled to the same working conditions and the same legal rights as permanent employees.
Your main obligations are to:
- Ensure every employee has the right to work
- Provide a Contract of employment
- Pay at least the national minimum wage
- Provide a payslip
- Ensure that the employees’ working week does not exceed 48 hours
A contract of employment for a seasonal worker will be largely the same as for a permanent employee. However, a fixed-term contract will need to have an end date.
Confronting Poor Performance
Whether you are a manager or an employee, annual performance reviews can be gruesome. It may be a little daunting, but these reviews are essential for any business, and they can empower or de-empower your employees.
What’s a performance review?
A performance review formally examines the employee’s job performance over a certain period. It’s importance is emphasized due to the fact that only 50/5 of employees know exactly what their superiors expect from them.
During the process, managers asses an employee’s entire performance, including their strengths and flaws. At this point, the supervisor can give constructive feedback and help workers set new goals.
Qualities of a successful performance review
These three qualities make any performance review effective and successful for managers and employees.
1. Achievement-oriented
Performance evaluations are far too frequently perceived as punishing rather than helpful, which demotivates workers. The best bosses praise their workers for their accomplishments and show them where they might grow in the future. Successful progress reviews should provide an opportunity for discussion about achievements as well as opportunities for critique.
Managers should communicate what they are supposed to achieve and address potential methods workers can use to operate at their peak performance.
2. Accurate and free of bias
Regular reviews allow workers to respond to what is said in the review instantly. Aside from that, they are more inclined to depict performance accurately.
Supervisors can conduct progress reviews frequently e.g every six months.
3 things workers should do during a performance review
Instead of worrying and waiting their turn to defend work achievements and failures, here are some of the things that they can do to prepare themselves during a performance review.
1. Create Notes: before each performance evaluation, workers should take notes on the discussion topics, objectives, strengths and flaws.
2. Self- evaluate workers should simulate a performance review for themselves to learn self- evaluation. They need to sit down in groups per department and analyze accomplishments, ambitions, shortcomings, and strengths.
3. Bring questions: in performance assessments, workers should be able to ask questions about certain parts that might be unclear to them. It might help to guarantee that all necessary questions are answered if they prepare their inquiries in advance.
Changes to Right to Work Checks
Right-to-work checks are an important part of employment law, but the ways in which they are conducted have changed in response to the pandemic.
The Current Situation
Under UK Law it is illegal to employ individuals who cannot prove they have the appropriate right-to-work documentation. Those who choose to recruit illegal workers face criminal convictions and can incur fines of up to £20’000 per employee. It is therefore crucial for employers to follow the necessary steps and to be able to show evidence that the correct steps have been taken.
What’s Next?
Since the pandemic, the government announced new ways of conducting right-to-work checks as face-to-face checks were no longer an option.
From April 6th, the status of all foreign nationals who hold either a biometric residence card, biometric residence permit, or frontier worker permit now needs to be checked online rather than manually. All that is needed is a date of birth and a share code to verify someone’s eligibility via the government’s online checking service.
From 1st October 2022, employers will be asked to use certified Identity Service Providers (IDSPs) to complete digital right-to-work checks for any British or Irish citizen holding a valid passport, as an alternative to undertaking the manual checks. Employers must submit digital images of personal documents, rather than copying original documentation.
These amendments will leave employers with a choice: return to the manual process, which is more time-consuming, or revert to digitally checking which will have cost implications for future budgets.
Related Articles:
What you need to know about Hiring Employees in the UK
Case Law: Harper Trust v Brazel
In the case of Harper Trust v Brazel, the Supreme Court has confirmed that workers who only work for part of the year, but on permanent contracts, are effectively entitled to the same holiday allowance as workers who work all year.
Background to the case
Mrs. Brazel brought a claim against her employer, Harpur Trust, in relation to holiday pay. Ms. Brazel was a visiting music teacher, employed on a permanent, zero-hours contract. She was paid for the work she did. Mrs. Brazel did not work a full week and she was not required to work during the school holidays.
She argued that as a worker, she was entitled to a full year’s paid leave (5.6 weeks) in accordance with the Working Time Regulations 1998 and not a pro-rated holiday based on the weeks she actually worked. She also argued that her holiday pay should be calculated based on her earnings in the previous 12-week reference period (now 52 weeks). The Trust- as many employers have done- was following ACAS’ guidance which suggested that employers use a multiplier of 12.07% to pro-rate holiday entitlement for part-year workers. Since the Supreme Court ruling, this ACAS guidance has been removed.
Supreme Court Decision
Where a part-year worker works on a permanent contract throughout the holiday year but has irregular hours and pay they are entitled to 5.6 weeks statutory leave and their holiday pay should be calculated, not on a pro-rata basis, but based on a ‘week’s pay’ averaged out over the previous 52 weeks.
The effect of the judgment is that Mrs. Brazel ad other similar workers who work atypical working patterns or who don’t work a full leave year will be paid proportionally more by way of holiday pay than those who work full-time or part-time.
Next Steps
Firstly, employers must assess the number of workers that could be impacted by this decision. Employers should also ensure that when calculating holiday pay, they use the correct calculation moving forward and make any amendments to workers’ contracts to reflect how holiday pay will be calculated moving forward. Employers may also consider in the future, whether a fixed-term or a temporary contract rather than a permanent one.
Employers may want to use this as an opportunity to review the working patterns they have in place and particularly how permanent contracts are used for employees working different patterns.
Employing Young People: What you need to know
With the Summer season upon us, may employers will be looking at recruiting teenagers for the summer months. In doing so employers need to be mindful of the specific legislations that apply to young workers.
There are a number of employment rights all workers have when they start a job, but younger workers, those who are under 18 years old, have a few additional rights to protect them at work.
Key Points:
- Younger workers are entitled to two days off per week
- A daily rest break of 12 consecutive hours (the break between finishing work one day and starting work the next)
- A rest break of at least 30 minutes if the working day lasts more than 4.5 hours
- Younger workers normally will not work more than 8 hours a day or 40 hours a week.
- Younger workers don’t work at night, but there are some exceptions
- Workers aged 16-17 are entitled to be paid at least the National Minimum Wage at the relevant rate.
National Minimum Wage Rate April 2022
Age 23 or over - £9.50
Age 20-21 £9.18
Age 18-20 £6.83
Apprentices & Under 18 £4.81
Working Time Regulations
Normally younger workers (16 & 17 year old’s) are entitled to 12 hours of uninterrupted rest within a 24 hour period in which they work for.
They are entitled to 2 days off per week and these cannot be averaged over a 2 week period and they should be consecutive days.
Night Work Limits
Workers under 18 are not usually allowed to work at night, however, exceptions can apply in some circumstances.
Young workers may work during the night if they are employed in a hospital or similar places of work, or in areas such as, advertising, sporting or cultural activities.
Young workers may work between 10 pm or 11 pm to midnight and between 4 am to 6/7 am if they are employed in:
- Agriculture
- Retail
- Postal or newspaper deliveries
- A catering business, hotel, public house, restaurant etc
- A bakery
Working Hours for workers over 18
In general, workers aged 18 and over are entitled to:
- Work no more than six days out of every seven, or 12 out of every 14
- Take a 20-minute break if they work more than six hours at a stretch
- Work a maximum 48-hour average week
