The annual increase in compensation limits and levels of tribunal awards came into effect for dismissals on or after 1 February 2008. A week's pay for the purposes of calculating statutory redundancy payments and the basic award for unfair dismissal increased to £330; the maximum compensatory award for unfair dismissal increased to £63,000; guarantee pay (where a worker is laid off due to there being no work to do) increased to a daily rate of £20.40 per day and the minimum basic award in cases where the dismissal was unfair by virtue of health and safety, employee representation, trade union, or occupational pension trustee reasons increased to £4,400.

See: /docs/legal/keystatistics.html

However, some things remain at the same rate! For the second consecutive year fees for criminal record checks will remain the same: £31 for a standard CRB check and £36 for an enhanced check. A Protection of Vulnerable Adults (POVA) first check remains £6 and the checks are free for volunteers. During the last year, the CRB has upgraded its online tracking service, allowing applicants and organisations registered with the CRB to track the progress of their applications, and they have also added more data sources to their database including data from the British Transport Police and the Police Service of Northern Ireland.

See: /docs/legal/employeesconvictions.html

Just a reminder that new, tighter rules apply from 29 February regarding checking the right of new employees to work in the UK - those who negligently hire illegal workers now face a fine of up to £10,000 for each offence and those who knowingly do this risk an unlimited fine and a prison sentence.

The BIA has now released final details of the documents which need to be checked - there are two lists, A and B - those in list A provide ongoing cover and those in list B are for those with leave to work for up to 12 months, and where there is a need to review these at least annually. See:www.bia.homeoffice.gov.uk/sitecontent/documents/employersandsponsors/guidancefrom290208/

For more information on checking the right to work in the UK generally, see /docs/legal/foreignnationals.html

We've waited a long time for clarification whether employees on long term sick should accrue statutory paid holiday - and we're now a bit closer to a definitive ruling, although we suspect that many of our clients will not approve of the outcome!

Back in spring 2005, the Court of Appeal (in Stringer v HMRC, previously known as Ainsworth v HMRC) decided statutory paid holiday does not continue to accrue whilst an employee is off on long-term sick-leave. They also decided that if a worker's employment ends without him/her having worked at all during the holiday year, the worker would not qualify for a payment in lieu of untaken leave.

The employees concerned appealed to the House of Lords, who referred the question to the European Court of Justice (ECJ).

The Advocate-General, who advises the ECJ and whose opinion is normally, but not always, followed by the court, has advised that paid holiday SHOULD accrue whilst an employee is absent on sick leave. She also advised that workers may not take their holiday while they are on sick leave; and that if the contract ends, the worker is entitled to a compensatory payment to reflect accrued but untaken holiday, even where the worker was on sick leave throughout the holiday year. This means that for the purpose of holiday accrual, sickness absence should be treated as if the worker had been at work, at least as regards accruing statutory leave guaranteed by the Working Time Directive.

The Advocate General failed however to clarify whether a worker may carry forward and then take statutory annual leave if he/she returns to work from sick leave after the end of the holiday year. Previously, in a German case (Schultz-Hoff) the opinion was that if a worker cannot take his/her leave entitlement before the end of the leave year due to sickness, the employer should allow this to be carried over to the following year. How this would work in practice remains unclear, though the Advocate General suggests that it would be for individual member states to fix the circumstances in which carry-over would be permitted and workers could be given incentives to encourage them to take leave within a reasonable period.

The ECJ will give its final decision later this year - at the moment our advice is to stick with the previous Court of Appeal ruling, until such time as this may be overturned.

But we do have some clarification regarding sick pay for employees on ordinary maternity leave! The EAT has ruled (in Department of Work and Pensions v Sutcliffe) that an employee who is sick during her ordinary maternity leave period is not entitled to be paid contractual sick pay during that period. So:

• normal contractual sick pay rules apply prior to maternity leave
• during maternity leave, the statutory maternity pay scheme replaces ordinary pay (including sick pay)
• after maternity leave, a woman who is off sick is once again entitled to any contractual sick pay in the normal way.

The Pensions Bill passed its second reading on 7 January 2008. This covers more detail about the new Personal Accounts (due to come into force in 2012), automatic enrolment and minimum employer contributions. Under the new Personal Accounts the worker is required to contribute a minimum of 4% of salary, the employer a minimum of 3% and there is 1% tax relief from the government. Workers will be automatically enrolled into a Personal Account unless the employer offers a workplace scheme that is at least as good.

The Pension Regulator has also recently issued 'Guidance for Trustees' which is aimed at anyone who is or would like to become a trustee of their pension scheme. It offers a basic overview of the duties and responsibilities of the role and is a useful introduction. See: www.thepensionsregulator.gov.uk/trustees/guidance/index.aspx

In fact there are quite a lot to report this month!

Discrimination - some interesting developments

Age: we have the first successful case of age discrimination in Northern Ireland since the Employment Equality (Age) Regulations were introduced there in October 2006! This is a case of a job applicant, Terence McCoy, who unsuccessfully applied for a sales job with a timber merchant (McCoy v James McGregor and Sons Ltd). The employer recruited two younger candidates, had advertised for candidates with "youthful enthusiasm" and also asked age-related questions at interview. We would have thought that most employers would have been aware of the dangers of this but research shows that interviewers are still asking questions which are illegal under anti-discrimination legislation - the most commonly-asked banned question apparently is whether an interviewee is thinking about starting a family. Do note that it is not just bad practice to ask discriminatory questions; it could be very expensive!

And another age case - this time involving a firm of solicitors! When legal firm Clarkson Wright and Jakes forced a senior partner, Leslie Seldon, to retire at the age of 65 they may not have foreseen the amount of publicity this case would bring! The firm argued that whilst this was less favourable treatment, any discrimination was justified and proportionate. Seldon lost his claim, but intends to appeal. As a result of this, other similar claims are being put on hold pending the outcome of the case.

Disability: other forms of discrimination clearly protect anyone against discrimination "on the grounds of" religion, race, sexual orientation etc. In Coleman v Attridge Law and Steve Law, the Advocate General has considered disability, and the case of a lady who claimed discrimination when she requested flexible working arrangements to look after her disabled son. Mrs Coleman felt that she received less flexibility and support than colleagues with non-disabled children, and that her employer used her son's disability to manipulate her working conditions. Whilst the Disability Discrimination Act 1995 protects those who have disabilities, the Advocate General took a broader view and suggested that the European Equal Treatment Framework Directive prohibits all unlawful discrimination and harassment by association - ie the claimant does not have to be disabled herself. The Advocate General's opinion is usually, but not always, followed by the ECJ.

The implications of this would be to broaden the scope of the disability discrimination protection to cover not just those who are disabled, but also those employees who are associated with the disabled.

If the ECJ agrees with the Advocate General, the Government may need to change the relevant disability and age legislation to bring these in line.

Sexual orientation: a female bouncer who claimed harassment due to her being heterosexual has been awarded more than £6,000 damages for unfair dismissal. Sharon Legg, who worked at a gay club in Bournemouth, claimed that she was abused by fellow door staff (all of whom were gay) for not being a lesbian or bisexual. Mrs Legg also told the tribunal that she was referred to in a derogatory manner by her manager as a "breeder." When she was sacked without warning she claimed unfair dismissal (Sharon Legg v Rubyz Limited).

The employment tribunal ruled that she had been unfairly dismissed and had suffered harassment for being heterosexual, but that she was not dismissed because she was heterosexual. However, this case has set a precedent in terms of clearly confirming that all employees can bring a claim under the Sexual Orientation regulations - ie whilst the regulations were put in place primarily to protect minority groups, they can also serve to protect heterosexual employees.

Part-time workers

This case is a German case involving a part-time teacher, Ms Voss, but it's one which could potentially affect many part-time workers in the UK who do unpaid overtime. Ms Voss was contracted to work 23 hours per week (a full-time comparator would work 26.5 hours). Overtime was generally unpaid, but if it exceeded five hours in a month the employee would be given time off in lieu or, if not possible, then this would be paid. Ms Voss worked between 4 and 6 hours overtime per month but instead of getting the time off in lieu, she claimed that any overtime she worked (up to a maximum of 26.5 hours) should be paid at the same rate as the full time workers.

The EJC agreed - they said that Ms Voss should receive the same pay as a full-time teacher receives for the same hours.

The implications for those who employ part-time workers who work overtime is that they should be paid in full until they have worked the same hours as a comparable full-timer. (A previous ruling of the ECJ had suggested that any threshold for paid overtime should be reduced pro rata for a part-time employee.) There is of course no right to be paid MORE than the full-timer - so the part-timer receives basic rate pay until such time as he/she has worked the normal full-time hours, and when the part-timer has done the full time hours, any further overtime is unpaid or paid at the applicable rate as for full-timers.

See: /docs/legal/parttimers.html

Customer pressure

If your clients put pressure on you to remove a worker from a contract, what do you do? An interesting case (Greenwood v Whiteghyll Plastics Ltd) involved a shop fitting business who received complaints from its customer, the supermarket Morrisons, about its employee, Mr Greenwood.

The employer, who had just made 9 staff redundant, considered whether they had any alternative work available for Mr Greenwood, but found none and therefore dismissed Mr Greenwood, who claimed unfair dismissal.

The tribunal recognised the power that Morrisons, who were a major client, held over the employer, and found that there was a fair reason for the dismissal, namely "some other substantial reason". They felt that Whiteghyll had acted fairly in dismissing for that reason.

On appeal, the EAT accepted that there was a potentially fair reason for dismissal, namely pressure from an important client, but said that the tribunal should have also taken into account the nature and extent of the injustice caused to the employee as a result of the dismissal. This would involve looking at the whole picture, including the employee's length of service, performance record and the likely difficulties in finding another job. The EAT went on to say that if an employer finds that the employee has suffered serious injustice, it should consider ways of alleviating the injustice. This could include speaking to the customer to see if there is a way of resolving the situation without removing the employee, for example, by performance managing or re-training the employee. If not, the employer should consider alternative work and if none is available consider solutions such as swapping the employee with one working for another customer or perhaps finding a role for the employee that is not customer facing. Finally, and only then, if no alternatives are available, the employer must remember to follow the statutory dismissal procedure before dismissing.

See: /docs/guides/thirdparties.html

Dismissal procedures

The Employment Appeal Tribunal has ruled that a capability dismissal will normally be unfair if the employer fails to take reasonable steps to find out whether the employee is entitled to ill-health retirement benefits and therefore unreasonably deprives the employee of these.

Dismissal and grievances - extensions to time limits

Firstly, a case regarding the extension of time to bring a claim. Employees must normally lodge an unfair dismissal claim within three months of dismissal but this timescale may automatically be extended by three months where the employee has lodged an appeal which is still ongoing at the end of the normal deadline. In Ashcroft v Haberdasher's Askes' Boys School, Mr Ashcroft's appeal against dismissal was dismissed at 6pm on the last day of three-month period. Therefore at midnight, the time the three month deadline expired, there was no pending appeal and therefore no automatic extension of time.

The EAT decided that Mr Ashcroft had the "anticipated protection" of regulation 15 (extending time for three months) up until 6pm on the last day of the limitation period, and since the statutory disciplinary and grievance procedures aimed to discourage tribunal proceedings before an internal appeal was dealt with, it was not reasonably practicable for him to lodge tribunal proceedings within the normal three month period. They therefore allowed the extension. So don't delay resolving an appeal until just before the deadline in the hope that the employee won't be able to submit his/her case in time!

The EAT has also clarified that the three month extension to time limits under the statutory grievance procedure means that the total time limit for (most) claims is six months less one day, not six months. Presumably this also applies to an extension for appeals!

Redundancy consultation

Even if you are making less than 100 employees redundant, any failure to consult for the appropriate period may be penalised at the maximum rate. The EAT has held that the maximum penalty of 90 days' pay should apply unless there are good reasons for awarding less. In Evans v Permacell, more than 20 (but less than 100) employees were made redundant so they should have consulted for at least 30 days. The employment tribunal therefore awarded 30 days' pay as a protective award but this was reversed by the EAT who said that the full 90-day penalty should apply.

In another case relating to protective awards for failure to consult over collective redundancies (Day v Haine), the High Court held that protective awards made after the liquidation of company are not recoverable in the liquidation, as the 'debt' (ie the protective award) only comes into existence after the liquidation. An appeal has been lodged: the implication for employees is that if the debt is not recoverable under the the liquidation process then they may lose out - under s184 of the Employment Rights Act 1996, BERR is only bound to pick up a total of eight weeks' pay including any protective award.

We have a new government body, the Risk and Regulation Advisory Council (RRAC), which is aimed at helping the government to manage and clarify any risks to the public. It will examine public risks in areas such as public health, pensions, health and safety etc to try to ensure a more balanced approach.

The government cites examples where measures have been disproportionate to the risk, including:

• the banning of hanging baskets because they could fall down and hit someone on the head
• stopping actors in pantomimes from throwing sweets to children in the audience in case someone is injured
• the case of a Rotary club's Father Christmas being made to wear a body harness in case he fell off his sleigh
• the banning of home-made cakes being offered at fetes for fear of food poisoning.

The RRAC will replace the Better Regulation Commission and will work with ministers and senior civil servants to develop a better understanding of public risk, and how best to respond to it.

France, Germany and Portugal have now introduced workplace smoking bans - although their rules are a little different to ours (for example in Portugal, public buildings can have smoking zones if they are clearly signposted and ventilated).

The government has published new inspection figures which reveal that over 1200 written warnings were issued to UK employers for failing to prevent smoking in their premises between July and November last year. Do double check your smoking policies and if you don't have a policy you may like to use our template: /docs/pol/smoking/index.html

Do your employees regularly skive or do they come in when they should be at home in bed?

A survey of 2698 employees by Peninsula apparently found that 8 in 10 employees had considered using the Norovirus as a perfect excuse to have some time off work, and 73 % admitted to using the flu as an excuse to 'pull a sickie' in the past. Media coverage of the virus has raised awareness of it, and it's hard to find out whether someone is genuinely ill, especially since the government advice to those suffering has been to stay away from GPs and take time off work for at least 48 hours. However, regular skivers can come a cropper later on when they are legitimately sick and really do need to take time off work, but have exhausted their sick pay or else trigger an attendance management review!

Research from Boots shows that those who drag themselves into work whilst suffering from colds and flu are just as unpopular! They found that 47% of UK workers would prefer their colleagues to take time off and keep their germs to themselves - although 33% thought time taken off for a cold (not flu) was skiving. Almost everyone in the survey agreed that "man flu" does exist. 82% of women think that men moan more when they have a cold and 56% of men agreed with this!

If you're concerned about absences generally, bear in mind that employers who monitor their absence levels closely and who conduct return to work interviews are least likely to suffer from malingerers and are therefore in a better position to sympathise with and manage those who should be wrapped up in bed! Read our guide to managing absence: /docs/legal/absence.html

Just one addition this month- a template letter for a dismissal for Some Other Substantial Reason. See: /docs/lf/SOSR/index.html

There has been a lot of media coverage about our working lives recently, all adding further fuel to the work-life balance debate!

New research by Peninsula found that average commuting times have doubled over the past five years - the average time is now 1 hour 5 minutes (it was 35 minutes in 2003). It's not just those who travel by public transport - whilst the most common complaints included this being late, cancelled, breaking down, or too full to stop and pick up passengers, road users also complained of congestion and accidents creating severe delays (we would add the usual spate of February/March roadworks to that!)

On top of more time spent commuting, we're also working more unpaid hours! Peninsula found that on average workers take in total just 2 hours per week for lunch - compared to 5 hours in 2002. This is particularly prevalent amongst office workers who use the time at their desks to catch up on work, read emails and also do a bit of internet shopping or use social networking sites. And the TUC reckon that five million workers in the UK do nearly £5,000 each in unpaid overtime every year - an extra seven hours a week! According to the TUC, if workers did all their unpaid hours upfront, they'd not start earning until 22 February. The union has therefore designated this day as 'Work Your Proper Hours Day'.

So it will come as no surprise to find that a survey found 22% of employees would be prepared to take a pay cut to work from home.

• 6% were prepared to take a pay cut of between 6-10%
• 2% were prepared to take a pay cut of between 16-20%
• 83 per cent of respondents agreed that their decision whether to take a new job would be influenced by the ability to work from home.

Research by Zurich found that almost a third of full-time employees surveyed (30%) worked from home at least once during the month, spending an average of 15.7 hours there. One in ten spent more than 40 hours each month working at home.

If you are struggling with your annual pay review, or your retention rates, there is a clear message here to those who can afford to offer some degree of flexibility to their workers. The benefits can also include reduced absenteeism, less problems with timekeeping etc, as well as cost savings, improved technology, shorter working days and environmental benefits.

See: /docs/guides/flexible.html

Whilst on the subject of pay, the CIPD's Annual Reward Management survey reveals that almost half of organisations (46%) no longer award an "across the board" annual pay rise or cost of living adjustment. Manufacturing, production and private sector service firms were the least likely to do so.

The trend instead seems to be to allocate pay budgets to departmental heads to distribute among staff based on individual and or collective contribution, and movements in market rates and inflation. In such cases, in order to avoid claims of discrimination, there is a real need to communicate pay messages clearly and to have transparent criteria for awards.

In the private sector, the final salary pension scheme is also declining, with only one fifth of organisations offering these to all employees. Within the manufacturing and production sector, 50% have closed their pension schemes to new entrants, expected to increase to 68% this year. The survey detects an increasing number of employers putting more money into defined contribution pension arrangements.

Finally, following the recent public leaks regarding loss of data in government departments, you may be reassured to learn that a new rule has been introduced banning the removal of laptops containing sensitive information from any public sector offices!