When organisations panic

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Category: Briefings & HR Updates

A couple of high-profile, corporate cases recently have highlighted what happens when organisations panic. When they try to fix one problem, but unwittingly create another elsewhere.

And, in case anyone was wondering whether it was all worth it, it also underlines the importance of having robust legislation to ensure that organisations do the right thing, not just try to fix today’s problems.

Sainsbury’s fined £1 million

This was a health and safety case which happened during Covid, which resulted in not only Sainsbury being fined £1 million, but also resulted in very serious injuries to a lady on a mobility scooter.

As the pandemic began to hit, Sainsbury’s in Newbury were keen to get their health and safety correct to protect both customers and staff. So, they put together a queueing system outside the store, the likes of which many of us became familiar with during 2020.

The problem was that the tape they used to divide the lanes was so weak that customers either broke it deliberately, or the plastic barriers below it blew over in the wind. So, they decided to use something altogether more robust, and pretty well unbreakable. The problem was that the parcel strapping was black, not easily seen and at head height for anyone on a mobility scooter.

The lady involved endured life changing injuries when she failed to spot the tape fixed between two car park pillars.

Sainsbury’s were investigated and prosecuted by the local Health and Safety Executive. The judge recognised that they were trying to do their best in difficult circumstances. However, no health and safety risk assessment had been carried out. If they had, they would hopefully have spotted the danger immediately.

As no risk assessment was carried out, and the result of the serious accident that occurred was found to be the fault of the organisation, Sainsbury’s were duly fined £1 million. Something that will have a big impact on the store and organisation’s reputation and profitability. Let us not forget that all of the supermarkets continued to have a pretty profitable time during the pandemic which could explain the size of the fine.

The investigating officer stated “I think the message to take from this is to not to take your eye off the ball. Consider all areas of potential hazards and risk assess.”

“If Sainsbury’s had carried out an adequate risk assessment, I am sure staff would have considered the potential outcomes. Of course, the circumstances of the pandemic played a role in this, but I think the lesson to take is that it is easy to be distracted, and think you’re doing the right thing in one area, but actually find yourself creating another issue somewhere else.”

The victim is likely to also have a very strong and expensive personal injury claim.

The P&O situation

We have not really had to comment too much on P&O’s current, lamentable situation. There has been enough coverage about it in the press.

But it, like the Sainsbury’s case, shows exactly what happens when the organisation takes a short-term view and either ignores the consequences, or thinks it can get away with it.

By the admission of their Managing Director, P&O Ferries (not P&O cruises, who are a completely separate company and entirely innocent, but whose reputation has also been badly affected), the organisation knew they were breaking the law. Nevertheless, they decided that the cost of doing so and any subsequent fallout was preferable than continuing to pay the lawful UK national minimum wage or above to their workers.

Not only were they relying on a slightly perverse provision in the law that said ships registered overseas were not subject to UK employment law, even on UK routes, but they had also cynically re-registered a number of their ferries a few years ago to take advantage of this loophole.

The subsequent fallout has surely cost them far more than the savings that they make on the hourly rate for their crew. Their failure to even carry out the minimum of consultation, let alone the statutory 45 days, shows why we have such laws.

Their fairly weak argument that they had lost £100 million the year before during the pandemic so that they could not afford to continue, scarcely holds water. Especially when their parent company had just spent £250 million on sponsoring the European golf tour.

The immediate outcome has been that the Government has rushed through a change in the law to ensure that any new crew have to be paid the national minimum wage. We suspect that the fallout for P&O will continue for many years, and we wonder whether they will have a viable future in the UK. If they are relying on insurance cover to cover the costs of the losses from their actions, that may not happen given the fact that they made a conscious decision to break the law on collective redundancy consultation.

If they had operated in exactly the opposite way, done proper group redundancy consultation and supported their workers throughout all of this, the public probably would have come flocking back. How their rivals must be rubbing their hands with glee.

In a tight labour market, they are unlikely to be an attractive employer to anyone other than a seafarer from abroad, who regards c. £5 per hour as a good deal.

So, what is the learning from these two cases?

Large employers are no more immune from getting matters wrong than SMEs if they fail to follow good professional advice. Always take a holistic view when making business decisions, be it traffic flow as part of a car park risk assessment through to making large scale redundancies.

Follow the basic legal requirements, take a reasonable and considered approach as opposed to a knee jerk one.  Always consider the reputational as well as safety risks arising from rushed decisions, or calculated ones designed to get around the law.

 

 

The guidance provided in this article is just that – guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice. 

Having been extended on a number of occasions, the Covid adjusted Remote Right to Work Check will officially come to end on 5th April to be replaced by a mixture of in-person manual checks and a number of online checks.

These are significant changes to the previous procedures and they need to be carefully studied. Full details, and they are very long and involved, can be found here.

Legitimate Checks do not need to re-done

Originally, the Government had stated that once the temporary Remote Checks period had come to an end, all checks would have to either be verified or be repeated in person. But now that is no longer necessary.

So, the good news is that any legitimate check carried out before 5th April will not have to be re-done, even if carried out remotely.

Of course, if such checks reveal the Right to Work is a time limited one, they will still need following up at the appropriate time.

Online Checks

Many employers are already familiar with the online check for EU and EEA nationals who qualify for settled and pre-settled status.

But until now employers have also been able to take copies of their Biometric Residence Cards and Permits. From 6 April this will no longer be possible and the free online checking service will be the only way to check this and show a “Statutory Excuse”.

The UK Visa and Immigration Service (UKVI) has suggested they will also be introducing a paid for online check for British and Irish Passport holders and those with Indefinite Leave to Remain.

A manual check will always still be permitted for the time being, which will cost nothing.

Permanent or Temporary?

Carrying out Right to Work checks is something that all employers should know about. It is mandatory to carry these out for all new employees.

There are two lists of documents, List A and List B.

List A refers to those who have a permanent right to remain and work in the UK. You do this check once, and if you establish the worker has a permanent or continuous Right to Work, you are done forever. It does not have to be checked again while they continue to work for you.

List B on the other hand, relates to those who have a temporary or time-limited permission to remain or work in the UK. Depending on how temporary or time-limited that permission is, employers have to recheck the permission periodically, and certainly shortly before it expires. This is also the case for the online check. Check the guidance for more detail on this.

These Lists A and B are slightly different to what they were so do not rely on old lists!

It is the re-checking process we suspect which is where most employers will fall down. Many are quite assiduous at checking people’s Right to Work when they first joined the organisation, but singularly fail to follow up and recheck their permission as prescribed by the law.

Any audit of your workers could lead to embarrassing situations, and indeed, we have dealt with employers who have found themselves in this situation. In almost all cases, it has not meant that individuals are not allowed to work in the UK, simply that their paperwork is not up-to-date, and in some cases the individual themselves has not renewed it.

The risk to the employer, however, is an expensive fine, so make sure you have a robust system in place, especially if you employ a lot of existing non-UK nationals. If you do not employ many/any non-UK nationals do not think it is unimportant. Just checking people who look/sound different is a good way to generate a race discrimination claim.

The UKVI has stated its intention to put all checks online by 2024.

 

 

The guidance provided in this article is just that – guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice. 

Despite the rise in the number of requests for flexible working recently, there have been relatively few cases on the subject since the start of the pandemic.

Earlier in the year, we had a decision regarding the turning down of flexible working requests without proper consultation in Hodgson v MDA Ltd.  We reported on that here, and the employer’s stance was held to be unlawful and it cost them £60,000. Proper, meaningful consultation had not been carried out.

We had another case, Dobson v North Cumbria Integrated Care NHS Foundation Trust.  Here, it was ruled that unfairly applying criteria to flexible working requests that discriminated, in this instance particularly against working mothers, was unlawful. You can read about our thoughts here.

But so far, we have not had anything that has talked about the length of time it takes to make a decision.

This was set a few years ago by the ERA (Employment Rights Act 1996, as amended) at three months. Once a flexible working request is properly submitted by the employee in writing (this includes email), the employer must have come to a decision, including allowing for any appeal, within three months. The only exception to this is where both parties mutually agree to an extension of the time between them.

Way before the pandemic, in early 2019, in Walsh v Network Rail Infrastructure Limited, the Claimant had submitted a proper flexible working request. This had been turned down by the organisation and that decision was appealed.

Unfortunately, and this was not disputed, through no fault of either party, that appeal could not be heard until after the three months was up. The Claimant then submitted an ET1 (an Employment Tribunal claim) that the organisation had not treated his request properly, and that the process had not been completed within the decision period.

The Employment Tribunal rejected the claim, saying they were not able to hear it until the appeal process had been completed. And, as they had both agreed to it taking place after the deadline, they had both implicitly agreed to extend the decision period, something that the law allows them to do by mutual consent.

This decision was overturned by the EAT (Employment Appeal Tribunal), so the Employment Tribunal was told to hear the case. The facts of the case are not particularly relevant, but some of the Judge’s comments are. In particular, it is beholden upon employers to complete these requests within three months, as very often employees are in situations where they need a quick decision.

“Part of the statutory purpose of these provisions is to ensure that decisions are made with reasonable dispatch. That is for obvious reasons. Employees often seek flexible working because of urgent personal circumstances.”

It is simply not good enough to delay, even if the reason for that delay is beyond both parties control. In reality, with hindsight, it is possible that the employer could have acted upon the initial request earlier, and not relied so much upon ACAS, who were the ones who were responsible for the hold-up.

Flexible working requests are becoming more and more frequent, as the pandemic has caused many to re-evaluate their working lives and patterns. We just need to remind employers that these need to be treated properly, with a proper process and a right of appeal, and that everything should be completed within three months.

That is unless both parties agree explicitly to extend the period. Silence or lack of complaint, cannot be held to signify that the employee has actually agreed to delay beyond the three-month timeframe.

 

 

 

The guidance provided in this article is just that – guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice. 

You may recall that over the past year we have referred to Fire and Rehire strategies on a number of occasions.

These have been used by some organisations during lockdown to help organisations ‘renegotiate’ their employment contracts, supposedly to help them survive. They have been called into question by unions, politicians and members of the HR community.

ACAS wrote a very critical report on the subject during the summer. And they promised to the Government that they would produce guidance to employers, laying out the best way to negotiate changing contracts.

It has been something that we have never advocated either. Essentially, it is a unilateral breaking of the original employment contract, softened by the promise of new employment, albeit generally on less favourable terms.

Not only does it seem to us to be unfair to the employees and damages working relations, it also potentially lays the organisation open to legal challenge and bad publicity.

We recognise that there are times when contracts do need to be renegotiated or altered. The pandemic and the furlough scheme meant that many employers had to quickly sort out a plan to allow short time working and layoff to be incorporated into employees’ contracts.  We are pleased to comment that nearly all of our clients did not have that hassle, as the appropriate lay off the short time working policies were already in place.

But the blunderbuss approach of firing everyone and then re-engaging is a sledgehammer to crack what is very often a much smaller problem. And many who have approached their staff problems in this way are finding it difficult to win back the trust of employees now there is a genuine labour shortage. Long term the approach may very well prove to be more expensive than the savings.

ACAS certainly seems to think so, and last week followed up their report by publishing new advice. This is aimed at helping employers maintain good employment relations and reach agreement with staff if they are thinking about making changes to their contracts.

In particular, the guidance covers

  • When to considering employment contract changes
  • How to propose them
  • Consulting about the changes
  • Handling requests for changes to an employment contract
  • How to proceed if employment contract changes are agreed
  • What to do if they cannot be agreed

ACAS Chief Executive, Susan Clews, said:

“Our new advice is clear that fire and rehire is an extreme step that can seriously damage working relations and has significant legal risks for organisations.

Employers should thoroughly explore all other options first and make every effort to reach agreement with staff on any contract changes.

Organisations that consult with their workforce in a genuine and meaningful way about proposed changes can help prevent conflict at work and stay within the law.”

ACAS’ full advice is available here.

We would see fire and rehire as the nuclear option, only to be considered when extensive negotiation has failed and/or when impending insolvency/liquidation means that there is genuinely no alternative, other than to cease to exist after energetic attempts have been made to make ‘life-saving’ changes by agreement.

It must also be re-iterated that doing so is likely to mean that key staff will leave, recruiting suitable replacements may be very difficult, and morale will for a time be low.

 

 

The guidance provided in this article is just that – guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice.

Good employers treat their employees well and fairly. We all know that.

And, to protect themselves, good employers also make sure they follow the right processes and procedures when having to manage attendance or performance, or to discipline or dismiss members of their workforce.

But good employers can also fall foul of an increasing trend we are seeing, especially when employees think that they might take their employer to tribunal. The dreaded subject access request (SAR) under the Data Protection Act.

For those who have followed the correct procedures, this should never present a problem. However, careless use of email communications, because the writer thinks that they are private, can come back to haunt the employer in some circumstances.

Over the years, we have received email communication from a number of clients proposing a course of action or outcome with named employees. These were not prompted by us, but should they appear in court documents, they could be very damning. You might think it, but avoid the temptation to put your personal thoughts about people or what you want to happen to them in writing, especially when an individual is named.

Common emails that make us wince when we receive them are often along these lines: “I want to make Joe Bloggs redundant, how do I go about it?” or “Joe Bloggs is useless, how do we get rid?”

A subsequent redundancy process might then go ahead, you do it correctly and include others in the pool, and this individual is then made redundant. The employee then claims it is unfair, puts in a tribunal claim and also makes a subject access request. For a few years, a SAR was normally a precursor to a claim, as the employee (or their solicitor) embarked on a fishing expedition to look for something bad to confirm their suspicions. This has now evolved to other claimants who make their claim and then put their ‘request’ in to get some evidence, when they have very little and/or to put pressure on the employer to settle.

Depending on how that request is made, the original incriminatory email could be part of the disclosure that you are bound by law to reveal. It would then be very difficult, if not impossible, to argue that the redundancy selection process was a fair one.

So, the lesson is that, when dealing with employee issues, anything that could be seen as prejudicial, even if that is not really what you were actually intending, should not be committed to writing. And indeed, if you are thinking of making redundancies, the people chosen should never be a foregone conclusion, they must always be subject to a fair, equitable process, where the most suitable candidate or candidates are chosen for redundancy, not just the outcome you are looking for.

In circumstances where you have decided that a particular individual has come to the end of the road, redundancy is rarely the right solution. Settlement agreements, where issues can be openly discussed and dealt with, are much more effective and secure. And, a properly worded settlement can get around a subject access request “fishing trip” by specifically excluding it from any action that the employee can subsequently take.

 

 

The guidance provided in this article is just that – guidance. Before taking any action, make sure that you know what you are doing, or call an expert for specific advice. 

At this time of the year, thoughts turn to raising morale and entering into a bit of festive spirit, but there are some seasonal hazards to be aware of.        

Most employers put their Christmas tree and decorations well out of the way during the year, and have to get them down from the loft or highest possible shelf. Use something safe to reach, not inappropriate chairs. The same logic applies to hanging decorations.

Are those old lights safe and properly approved with a CE mark? Do not allow your employees to have cables to lights trailing across walkways, or to cause an electrical overload. Paper decorations must be kept away from heat sources, and if you have motion sensors alarms, ensure that they are properly secured.    

We now turn to the more difficult bit surrounding Christmas, i.e. the traditional Christmas booze-up, or punch-up as we tend to call it.  If you organise a function then you need to give serious thought to how much drink you are providing, and warn people about the dangers of excessive consumption of alcohol. There are three main areas of risk:

  • drunks hurting themselves;
  • drunks abusing or hurting others; and
  • drunks driving home illegally;

Apart from the fact that you may be vicariously responsible for the above, there are likely to disciplinary issues arising, whether the function is held on site or off. You may even be responsible even if you do not organise it, if it is associated with work.

The consumption of illegal drugs is something you should also be on the lookout for.

Whilst not strictly Christmas related, this is a cold and dark time of the year and that has its hazards.  As an employer, you have a responsibility to ensure people can get into and out of work safely, especially in ice and snow. You also ought to be assessing the risk to drivers and others working on their own in bad weather, and taking appropriate steps to deal with your findings.   

Many employers take on temporary staff for Christmas, and you have an obligation to look after them. You need at least to complete an adequate induction plan, focussing on safety and appropriate behaviour, and have records of such.       

Christmas can be stressful either because workloads/hours increase and deadlines have to be met. Your employees are also trying to do too much at home, whether it be writing cards or going to parties. Look out for the signs of stress, and make appropriate welfare interventions. Hopefully this short article will not have added to your stress, and you will be able to have a good Christmas break having done all that you need to do to find the balance between looking like Scrooge, i.e. a killjoy, and creating a joyous environment.

We are often asked what are the benefits of using external trainers rather than using internal trainers, or asking a member of staff to run some training.

While the obvious benefit of using internal staff for training is the cost, this has to be carefully weighed against what type of training is needed and what you are looking to achieve for both the attendees and the organisation from any training.

As a general rule, we would say that using an internal trainer for things like your own product training can work, as clearly the Product or Sales Manager will know their products or systems better than an external trainer. However, you have to factor in the time it takes for your internal trainer to prepare the training and deliver it. Also what do you do if some important meeting comes up, or crisis within the organisation which means the trainer is unable to deliver the planned course? All the time spent getting staff together on a specific date is lost.
When you get into the area of behavioural or specialised training, we feel the balance certainly tips in favour external trainers. This is because external trainers are specialists and have to keep up to date with:

  • new methods
  • new industry standards
  • new methods and processes of delivery
  • what is happening across many sectors
  • what is new in their specific area of expertise

The delegates see external trainers as experts, which is less likely to be the case when using your own staff. Delegates can often be more open in sharing problems with an external trainer, either in open forum or informally. If the ‘boss’ or Manager of staff is giving the training, that may well inhibit open communication.

The saying ‘No man is a prophet in his own land’ comes to mind, which means (taken out of its biblical context) that your own people see you they way they always saw you, regardless of what you have to say. A less kind explanation is that ‘familiarity breeds contempt’. Whilst internal trainers may ‘know their stuff’, it sometimes comes better from an expert external source. We often find that people require someone from outside to reinforce what their HR professional has been telling them for years, that they have either never quite understood or believed.

The external trainer can get delegates to think ‘outside the box’ and challenge ‘we’ve always done it that way’ responses. A trainer from within the organisation may well be limited by their own knowledge of the organisation and end up colluding with delegates views, rather than trying to push boundaries.

Finally, we are hearing more and more about a growing skills shortage and organisations will need to focus on developing and retaining staff. Employing an external expert trainer to deliver training and development to your staff shows you are prepared to invest in their future with you, in a way that using internal staff may not.

So while there are some cost savings to be made using internal trainers, it may be a false economy when you consider the many benefits employing an external trainer brings.

  • Specialist training expertise
  • Experts in their area of training
  • Wide and varied industry experience bought to training
  • Increased credibility with delegates
  • More open communication
  • More likely to encourage thinking ‘outside the box’
  • Shows your staff you are taking them seriously by investing in their future with your organisation.

Most of us enjoy the hot weather but many of us also find it oppressive and difficult to work in. It is worth reading the Health and Safety Executive (HSE) on workers whose job keeps them outside for most of the day. Their leaflet INDG337: Sun Protection: Advice for Employers of Outdoor Workers gives advice on reducing the health risks for such employees.

The leaflet advises outdoor workers to follow the sun protection six-point code:

  1. Keep tops on to act as a barrier from the rays of the sun.
  2. Wear a hat with a brim or flap that protects the ears and back of the neck.
  3. Stay in the shade wherever possible, especially at break times.
  4. Use a high factor sunscreen on any exposed skin.
  5. Drink plenty of water to avoid dehydration.
  6. Check skin regularly for any unusual moles or spots and see the doctor promptly.

Employers or managers responsible for outdoor workers should make their workers aware of the above points and especially:

  • Include sun protection advice in routine health and safety training, as well as informing workers that a tan is not healthy but a sign of skin damage.
  • Make sure that they drink plenty of water to avoid dehydration.
  • Encourage workers to keep covered up when the sun is at its hottest.
  • Encourage workers to use sunscreen with a protection factor of at least 15.

The HSE says, “UV radiation should be considered an occupational hazard for people who work outdoors” so this needs to be considered as part of any generic workplace risk assessment undertaken.

Other workers that need to be considered are those that work in hot conditions all year round but when there is additional summer heat, their environments can get even hotter. These can range from professional kitchens, bakeries and laundries through to heavy industrial processing activities such as smelting or welding. These workers are at risk of heat stress, which is when the body’s means of controlling its internal temperature starts to fail. Air temperature, work rate, humidity and work clothing are all factors that can cause heat stress; the problem being is that it is not an obvious risk to people that are only passing through rather than actually working there. Factors to reduce risks include:

  • Control the temperature e.g. fans or air conditioning.
  • Provide mechanical aids to reduce strenuous work.
  • Regulate the length of exposure e.g. job rotation.
  • Encouraging people to drink small amounts frequently during and after working.
  • Provide training about heat risks, symptoms of heat stress, safe working practices and emergency procedures. Make sure first aiders know about what to look out for and what treatment to provide as well.
  • Allow workers to acclimatise to their environment and asses if they are fit to work.
  • Identify those who may be more susceptible to heat related illness, due to health problems or medication e.g. pregnant women or those with heart conditions.
  • Monitor the health of workers at risk and seek OH advice if necessary.

There is a useful example of a heat stress checklist and risk assessment at:
Heat Stress Checklist.

Finally, for those that are simply suffering the heat in an office environment, there is no upper temperature limit that employers must adhere to. The Workplace, Health, Safety & Welfare Regulations however, do require that working areas should be adequately ventilated with clean fresh air drawn from a source outside of the workplace with suitable circulation. That can mean either opening windows to switching on the air conditioning. High quality drinking water must be readily available. Workers who spend many hours in a vehicle driving can suffer with heat exhaustion increasing the risk of accidents, so make sure that they carry plenty of fresh drinking water in their vehicles, switch on the air conditioning, and take appropriate rests especially when driving at the hottest time of the day.

Actions

  • Check that your risk assessments cover hot weather
  • Make sure that your control measures are adequate for all of your workers, indoors and out, and anyone in between!

The guidance provided in this article is just that – guidance. Before taking any action make sure that you know what you are doing, or call us for a free initial chat on 01480 677980.

“I rely on BackupHR to help me ensure we are doing the right thing both for the business and our employees. They provide a first class service with very quick turnaround and help considerably when trying to make sense of ever increasing legislation. The ability to speak to my consultant, knowing I will get that return call even if she is out or busy with another client gives me that little bit of extra confidence when dealing with difficult or tricky situations.”
Moneyfacts (Financial)

“When the responsibility of the HR role was given to me to run alongside my existing finance role, the help I received from BackupHR was crucial to me in managing this role in an effective and efficient manner.”
Environmental Control Systems (Electrical/Manufacturing)

“We have used BackupHR services for many years now and are extremely pleased with their most efficient service they give to our company. The up to date current legislation that is provided is invaluable for our business. The personal touch really makes the difference. I would not hesitate to recommend Backup HR to other businesses that require this support.”
Stepney Ltd (Construction)

Here are some solutions we have delivered to our clients as part of their BackupHR™ Service.

Problem:
A client was instructed by their bank that to remain in business they had to rapidly reduce debt and, in particular, reduce their wage bill by 20% within 14 days. The challenge was that the 14 day timescale was not long enough for proper redundancy consultation, nor was a unilateral cut in pay legally enforceable.

Business Solution:
BackupHR™ helped persuade all of the Directors to take an immediate 25% cut in their pay, and then helped senior management negotiate with the entire workforce to accept an immediate 10% cut in their pay. BackupHR™helped draft the announcements, prepared for the group consultation meetings, dealt with numerous enquiries from Citizens Advice and other advisors, explaining that without this action there would be no company and no jobs.

The target was met within the timescale. The company survived, won many new orders as their competitors disappeared, the 10% pay cut was lifted within a year, and they are now flourishing, even though they still operate in difficult trading conditions.

We helped saved a company from going under with the subsequent loss of jobs in the local community, and all of our advice was given as part of our comparatively modest annual subscriber service.

Problem:
As a small start up business providing educational materials to schools, the founder originally and urgently needed a simple Handbook of all key employment policies relevant for her business, and, one employment contact that she could template for her first few appointments.

Business Solution:
BackupHR™ provided all that was needed within one week of the request, at the cost of £500 + VAT.

As the organisation rapidly grows in size, the next business milestone will be at around 6 month’s time when the founder aims to employ at least 10 employees. At that point, she plans to sign up with our subscriber service at the cost of approximately £200 + VAT per month, so she can get regular HR advice, support and guidance as she continues to grow in staff size and complexity. As her business grows, she will have further options to tap into more HR support, dependent on her staffing needs.

Problem:
A new client had a problem. Shortly before they engaged us, they had ‘laid off’ or made redundant someone who had been off sick due to an alleged accident at work. They had received a solicitor’s letter threatening an unfair dismissal claim.

Business Solution:
It was clear that they needed us. First of all procedural ‘oversights’ meant that they would lose an Employment Tribunal. We reckoned damages could easily be £10 – £20k.

We needed to limit the damage. We sent a letter to the solicitor, offering to re-engage the individual in a different job, provided he was now fit to work.

Over the next 5 weeks, we negotiated through both ACAS and the solicitor an amicable commercial settlement. This meant that the employee did not return to work, and he withdrew his claim. Within two months of using BackupHR™ our client avoided a costly claim, which covered our fee several times over.

If you would like to find out more, call Jackie Bolton 01480 677981

The Government rolled out its latest initiative, i.e. Tax-free Childcare scheme, in late April to show greater support for working parents. This issue has been addressed repeatedly by different governments, so that keeping up has never been easy.  To support parents, Governments have funded free nursery places for very young children, and have offered further support with government money in the form of tax incentives.  Until 2017 this second-phase of financial support has been delivered through Childcare Vouchers – a very tax efficient way of paying for some childcare provision.

Tax-free Childcare is designed to save parents up to £2,000 per year, per child, for children up to the age of 12, but in reality the average saving has been estimated at just £800.
There were problems with the Childcare Voucher offering, not least that to qualify for this support the working parent(s) had to be offered the scheme via their employer.  In our experience, most SMEs employers do not offer (or are completely unaware of) this option, and therefore many working households have missed out on this financial support.

Since 2005, employers have been able to provide parents with childcare vouchers as part of a salary-sacrifice scheme. These vouchers currently help around 780,000 working parents save up to £933 of tax and national insurance on their childcare costs per year. From April 2018, new entrants to the childcare vouchers scheme will not be permitted. Parents already in the scheme will, however, be able to remain in the scheme for as long as they require.

While some families will benefit from the roll-out of Tax-free Childcare, others risk being worse off, which means that employers need to be on top of these changes. Each case needs to be taken on an individual basis. Parents cannot use both childcare vouchers and Tax-free Childcare.  If employees leave the childcare voucher scheme in favour of Tax-free Childcare, they will be unable to re-join, even if their circumstances change in the future. With the roll-out expected to include children up to 12 years old by the end of 2017, there may be quite an increase in enquiries from parents in the not too distant future.

Employers can choose to play a voluntary role, by providing employees with information on the scheme, and/or by paying into employees’ childcare accounts.

Employers are not obliged to play a role in the Tax-free Childcare scheme, as the scheme will operate directly between parents and the Government. This may sound like good news for employers, but childcare costs can also be a problem for employers.  Enforced absence and financial hardship are issues that will distract even the best employees from their work.  This can be bad for productivity, not to mention those who may be actively considering leaving the workplace.

Employers ought to learn about the details of both schemes and understand how they will impact different employees, so they can not only educate their staff and offer guidance on the decisions ahead, but also show their commitment to enhancing their employees’ lives, both in and out of work.

Employers can act as a source of information on the scheme, for example by referring employees to the Government web portal for advice. www.childcarechoices.gov.uk through which parents can sign up to receive email alerts that will tell them when they can apply for Tax-Free Childcare.

A useful time to provide this information may be prior to, and on return from periods of family-related leave. There are also some good websites, such as: Employers For Childcare who produced a guide. Their guide includes a comparison of Tax-Free Childcare with other forms of support, practical examples, and answers to FAQs.

Actions

Employers can show their support for working families (particularly as some employees will be worse off under the new scheme) by:

  • Building a culture that clearly values each employee and their need for a family life
  • Providing employee benefits that helps to keep more money in parents’ pockets e.g. by choosing to pay into a childcare account
  • Having policies that help new parents return to work
  • Pointing employees in the right direction to get guidance

It should be noted that BackupHR™ are not experts in childcare vouchers so on this occasion we are probably not the first point of call for queries on this matter which is why we have provided information links instead.

The guidance provided in this article is just that – guidance. Before taking any action make sure that you know what you are doing, or call us for specific advice.