Earlier this year we conducted a study which aimed to highlight the illegal practices that businesses were unknowingly undertaking, in a bid to increase education surrounding the correct HR and employment procedures which organisations should have in place.
We were aware that many of these violations often took place without businesses understanding the repercussions that they could face if they were caught acting negligently. Yet, minor incidents, which could have been avoided if awareness surrounding employment law and HR policies were raised, often lead to costly – and brand damaging – tribunals.
With employment law and HR policies regularly changing, for smaller businesses who do not have dedicated HR personnel in the office or even outsource their HR functionality, organisations are often getting left behind leaving their paperwork out of date and the business vulnerable to HR discrepancies.
With gender pay gap reporting recently introduced from April 2017 (one of the biggest legislation changes in recent years) and Brexit set to generate greater employment law uncertainties and changes, now is the time for organisations to ensure that their practices are up to date and ready for future amendments.
To aid your business in understanding the instances where it may be acting illegally, we have collated the results of our study, along with advice on how you can ensure that you aren’t playing foul and that your policies are on the right side of the law.
While 62% of businesses are aware that an employment contract should be in writing, 38% of businesses believe this not to be the case.
A written contract is a legal obligation that you hold as an employer and should be provided within two calendar months of an employee’s start date with you, something which 68% of companies were aware of.
While a written statement of terms is required, verbal agreements are also legally valid, so you should be aware that any statements you make which aren’t in writing must also be adhered to. However, it’s best practice to ensure that all terms and conditions surrounding employment are put in writing.
A contract between employee and employer sets out an agreement of the employment conditions, rights, responsibilities and duties. A written contract should include details such as pay, probation period, hours of work, holiday entitlement, incapacity for work terms, pension details, termination period, whether employment is permanent or temporary, where expected place of work is, disciplinary rules, grievance procedure, and any other terms you wish to put in writing.
An employment contract covers both terms and implied terms. An ‘implied’ term may not be written down, but still forms part of the contract; for example, your employer providing a safe working environment, something which is necessary to do the job (e.g. driving license), or not stealing from your employer.
It’s also worth keeping in mind that once an employment offer has been accepted, regardless of whether a contract has yet been signed, you have entered into a legal arrangement which is in effect a contract of employment. Therefore, it is recommended that you provide all employees with a written contract as soon as possible.
To maintain best practice, it is advised that you have a grievance and disciplinary process in place. 54% of businesses thought that disciplinary processes have to be handled by an HR company. However, 46% knew this not to be the case.
Businesses often find that they are vulnerable as they fail to implement the correct policies. However these should be detailed clearly in writing and made available for employees to review as they wish.
As a guide, a disciplinary should take the following structure:
- Establish facts for the case
- Inform employee of the issue
- Hold a meeting to discuss the issue (with accompanying employee if appropriate)
- Decide on action to be taken
- Allow the chance for an employee to appeal
Right to Work Visas
Companies can be fined up to £20,000 for each individual worker and face five years in jail if they do not have copies of their employee’s passports or visas as proof of their right to work in the UK. Our study found that only 51% of businesses are aware they need to check right to work visas.
As an employer, it is your obligation to check that a worker has the correct supporting documents to work in the UK. You should check the original documents, in the presence of the applicant and ensure that you make copies of the paperwork, along with a record of the date the check was made.
Documentation should be checked that it is genuine, photos and date of birth are the same across the documents and are representative of the worker, the employee has the right to conduct the work that you are offering, and that the dates of the right to work in the UK haven’t expired. If documentation holds two different names, then supporting documents must be provided as explanation – e.g. marriage certificate, etc.
Copies should be made of the documents, and be kept during the worker’s employment with you, as well as two years after they have stopped.
If the employee cannot show documentation, then you should ask the Home Office to check their immigration status. This can be requested if you are satisfied that documents cannot be shown due to an administrative review or home office application, they have an application registration card or a certificate of application that is less than six months old.
Storing employee data
With cybercrime and data breaches on the increase, it’s good to see that 77% of businesses are aware that employee data should be stored securely and accessed by authorised personnel only. To maintain best practice, data should be password protected if stored digitally and locked in a secure place if it is in a hard copy format.
The following details should be kept about employees: personal details, employment history, tax and national insurance information, holidays, details of terms and conditions, absence details, further training or education records and details of disciplinary action and accidents in the workplace.
In addition, organisations may choose to keep additional details as part of a company-wide analysis. This could include data relating to salary, production, time-keeping, absences levels, etc. – however, records should only be kept if they are relevant.
It is illegal for businesses to immediately rehire for a role which they made someone redundant for, yet this is something which many are unaware of, with 46% believing that they can rehire for the same role, compared to 54% who understand that this is against the law.
Redundancies can happen for a number of reasons; a job may no longer exist in the business, workforce may need to be reduced, the business may close, or the work may no longer be required. As an employer, you must demonstrate the employee’s job no longer exists in the business.
A collective consultation period must exist if 20 or more employees are being mundant. This is a chance to explain why the redundancy is necessary and if any alternatives are available. It’s recommended that employers work with a trade union or formal representative during the consultation period.
Those selected for redundancy should be done so through a fair and objective process, based on the skills and attributes that each individual possesses. This may involve you looking through attendance and disciplinary records, skills, experience and work standards.
If, once an employee has been made redundant, you are able to rehire for the position due to your economic position changing or another contributing factor. However, you will need to prove that at the time the redundancy was of a genuine nature, and the demand for the job role is there once again if you face an unfair dismissal claim.
Many businesses often make employees redundant, to avoid tackling wider issues such as individual’s performance and rehire for the same position. However, it’s best practice to avoid this situation as not only are you acting illegally if you rehire for the same role immediately after, you are also avoiding addressing another issue – employee performance.
Checking Personal Messages
In the most infamous European Court of Human Rights (ECHR) cases relating to employment, in 2016 it was found that an employer had the right to monitor messages during working hours on a work device sent on an employee’s personal Facebook, WhatsApp and webchat applications. However, it is worth noting that the employer had an established policy in place which made clear that devices and the internet were not for personal use during working hours.
However, just 62% of businesses are aware they are legally allowed to take action such as this, with 38% unaware of the laws surrounding the checking of employee messages on work devices.
In their ruling, the ECHR called on employers to draw up policies which stated how and what information would be collected and whether they planned on doing so. So, if you plan on carrying out similar action, then ensure that you have a policy in place which covers whether you will check personal messages.
Discriminating During Recruitment and Interview
49% of respondents believe that they can ask different questions to candidates. However, this can lead to companies unknowingly discriminating against potential employees. Therefore, when interviewing it is best practice to ask the same questions where possible.
While you can pull out individual details on an applicant’s application form or CV, if you are examining competencies then the same question should be posed to each person who is interviewing for the position.
When interviewing you shouldn’t ask about a candidate’s protected characteristics. These include age, whether they are married or in a civil partnership, if they are pregnant (or plan on getting pregnant), on maternity leave, whether they are or are becoming a transsexual person, race, religion, sex, sexual orientation and disability.
Spent criminal convictions cannot be used as a deciding factor when looking to employ someone unless the area of employment makes them exempt. Whether an individual is a member of a trade union should not be taken into account, including whether they are already a member of a union or insisting that they join one before you employ them.
Businesses should also be aware that recruitment discrimination can occur through the wording of a job advert. The wording in your advert should not state nor imply that you will discriminate against anyone. For example, wording such as ‘recent graduate’ should only be used when this is a requirement of the job role. Otherwise discrimination could be implied. Where you advertise a position could also cause discrimination, as you may only be reaching one particular audience.
While many employers admit to checking a candidate’s social media profiles before they choose to interview or hire them, this could allow them to view protected characteristics which an employer is not entitled to. 46% of businesses admit to believing it is legal to check a candidate’s social media, and while it is legal to do so, the decisions you make should be based on the information and knowledge that you legally have access to.
Even if you don’t have a company sick pay policy in place, if an employee has been sick for four or more days (including non-working days), earns more than £112 per week (pre-tax) and provides you with proof of illness, then you are legally required to pay them Statutory Sick Pay (SSP). This is to the value of £89.35 per week, up to 28 weeks.
While it is not paid for the first three days that you are ill, if you have been paid SSP in the past eight weeks and are eligible again then the first three days you are sick will be paid.
Payment is made in the same way that an employee would receive their normal wage; and tax and national insurance will be deducted as per usual.
In order for an employee to claim SSP, they should contact you in writing (if required) and by the deadline you have set (if no deadline is in place, this should be within seven days). If you are sick for more than seven days, then a ‘fit note’ from a doctor should be provided.
63% of businesses were aware of their legal obligation to pay people when they are off sick, with 37% unaware that they were required to pay employees if they were ill for three or more days.
Of course, this study is not exhaustive, but it does help to highlight some of the key areas where HR and employment education and awareness is lacking. With Brexit set to change the employment landscape once more when the UK officially leaves the European Union, businesses need to ensure that their HR policies are legally correct and ready to be updated when changes are announced.
We do, of course, advise that you have a dedicated HR person in your organisation or outsource this functionality to not only safeguard your business from unwanted – and unnecessary – tribunal claims, but to ensure that you are doing right by your employees too.