Tag Archive for: Employment Law

Embracing shared parental leave, calculating holiday pay and policing zero hours contracts
More details published on the new scheme for working parents, judgments on holiday pay awaited from the courts, and the government asks for ideas on how to ensure the ban on exclusivity clauses is observed.
Shared parental leave

Draft regulations have been produced for the new right to shared parental leave (SPL) and official guidance is beginning to appear. The government has published an employer guide, and Acas has added more details on the scheme to its website, including a two-stage eligibility test.

Existing maternity rights remain unchanged and it is for the mother of the child to decide to move from maternity leave to SPL. Adopters will have full access to the scheme. The person requesting SPL must have worked for the same employer for at least 26 weeks by the end of the 15th week before the week the baby is due (or the week an adopter is notified of a match with a child). The other parent must have worked for 26 weeks in the 66 weeks leading up to the baby’s due date, and must have earned in excess of the maternity allowance threshold (£30 in 13 of those weeks). To be entitled to statutory shared parental pay (ShPP), a parent’s average salary must be at or above the lower earnings limit (currently £111) for eight weeks prior to the 15th week before the week the baby is due.

Employers have options once they receive an SPL notification. If the request is for a continuous period of leave, employers cannot reject it but they can ‘seek an agreed modification’ to it, having considered the request, and discussed it with the employee. However, employees are under no obligation to comply. A request to take the leave in blocks can be refused, and employers could choose to make no response to the leave notification, although Acas points out that this is “not good practice and should be avoided.” More in-depth Acas guidance is to follow this autumn.

The SPL regulations are due for enforcement on 1 December 2014 and apply to babies due on or after 5 April 2015, which means employers could begin to receive notices of employees’ intention to take leave in January 2015. Fathers and partners of pregnant women will still be able to take one or two weeks’ paternity leave paid at the statutory rate and, in addition, will have the right from 1 October 2014 to unpaid leave to attend two ante-natal appointments.
Case law round-up

Judgment is now awaited on a number of cases on holiday pay, including Bear v Fulton, that have been heard together (the most well-known of the group, Neil v Freightliner, settled before the hearing). The cases deal with how holiday pay should be calculated for employees whose pay fluctuates according to what hours they work, or what commission they earn. UK courts are still grappling with how to apply the European court ruling in Lock v British Gas earlier this year, which said that employees are entitled to ‘normal remuneration’ during leave and must not be made worse off by going on holiday.

Stuart Jones, head of employment and pensions at Weightmans solicitors, commenting on the cases said that “definite risks have now been identified and some organisations may wish to take steps straight away to calculate the value of the claims they may face. For some organisations, the potential outlay will be significant.”

Last year John Lewis paid out £40 million to 69,000 of its staff to correct errors in their holiday pay going back to 2006, and Jones said some organisations were already following this lead in trying to “neutralise the issue”.

For companies with part time employees who habitually work over and above their contractual hours, “there remains a question mark over whether these extra hours should be included in holiday pay,” he continued. “For many, the sensible approach will be to wait and see how the law develops. The courts have staked out the key issues to watch in the coming months.”
Zero hours
The government is consulting on how its proposed ban on exclusivity clauses in zero hours contracts, contained in the Small Business, Enterprise and Employment Bill, can be enforced. The consultation asks whether employers are likely to try to avoid the ban and how they might do this; whether the government should make provision now for dealing with potential avoidance or wait to see whether it takes place first; whether there should be consequences for employers evading the ban and what these consequences might be.

The government says it will review existing guidance with a view to improving the information available to employers and individuals. But it also suggests that business representatives and unions, with the support of government, should consider working together to “develop industry-led, industry-owned, sector-specific codes of practice on the fair use of zero hours contracts, as the reality of the situation is likely to be different in each sector”.

The consultation closes on 3 November.