Employment Law Birmingham News

New research from the Chartered Institute of Personnel and Development (CIPD) has found that three quarters of employers report a lack of leadership and management skills and too many managers have an inflated opinion of their ability to manage people.

According to the CIPD’s research, 72% of employers report a deficit of leadership and management skills. However, the CIPD’s quarterly Employee Outlook survey of 2,000 employees also suggests that one problem in tackling this skills deficit is that many managers don’t know how bad they are at managing people.

Eight out of ten managers say they think their staff are satisfied or very satisfied with them as a manager whereas just 58% of employees report this is the case. This ‘reality gap’ matters as the survey finds a very clear link between employees who say they are satisfied or very satisfied with their manager and those that are engaged – i.e. willing to go the extra mile for their employer.

The CIPD research found a significant contrast between how managers say they manage their people and the views of their employees.

• Six in ten (61%) of managers claim they meet each person they manage at least twice a month to talk about their workload, meeting objectives and other work-related issues. However, just 24% of employees say they meet their managers with such frequency.
• More than 90% of managers say they sometimes or always coach the people they manage when they meet, while only 40% of employees agree.
• Three quarters (75%) of managers say they always/sometimes discuss employees’ development and career progression during one to ones, but just 38% of employees say this happens.
• There are similar gaps in views between managers and employees on how often managers: joint problem solve with employees; discuss ideas employees might have to improve the business; and discuss employees’ wellbeing.

UK organisations are struggling to cope with Olympics staffing challenges, as many employees (21%) are willing to take unauthorised time off to watch high profile events. Even the risk of being caught is not a deterrence, and UK bosses admit that almost a third of skivers are likely to go unpunished.

Research sponsored by SunGard Availability Services reveals only 22% of workers think their organisation is prepared for disruption brought about by the Olympic Games and only 9% have received communication on flexible working policies for this time.

With almost a third (31%) of employees expecting holiday packages, new technology devices and flexible working hours to be introduced to their working life, organisations will likely be stretched and in a state of flux as it is – without counting the potential cost of employee absenteeism.

SunGard's Keith Tilley commented that: “Communication is the key factor in planning for any disruption. Outlining expectations and educating staff on continuity plans will lay the essential groundwork for continued productivity during the Games, and offers a chance to fine tune working practices for future planned and unplanned incidents.” 

The Supreme Court has given its judgment in the case of Seldon v Clarkson Wright and Jakes (A Partnership). This case concerns the scope for justifying direct discrimination on the ground of age and in particular a mandatory retirement age contained within a partnership agreement.

Mr Seldon joined the Respondent law firm in 1971 and was made an equity partner in 1972. In 2005 he and the other partners in the firm agreed and adopted a partnership deed which (like earlier deeds) provided that, subject to the partners’ agreement to the contrary, partners who attain the age of 65 had to retire from the firm by the end of the following December. Mr Seldon reached the age of 65 on 15th January 2006. Realising that he would need to continue working beyond this point, he asked the other partners to extend his tenure.

The proposals were rejected on the basis of there being no sufficient business need. The partners did however offer Mr Seldon an ex gratia payment of £30,000.

The Employment Equality (Age) Regulations 2006, came into force in October 2006, and Mr Seldon informed the partners that he was considering his rights under these. The partners then withdrew their offer of an ex gratia payment. Mr Seldon issued proceedings alleging, under the Age Regulations, that his forced retirement was an act of direct age discrimination and that the withdrawal of the offer of an ex gratia payment was an act of victimisation.

The Tribunal found that the mandatory retirement age of 65 was a proportionate means of achieving the firm's legitimate aims and therefore rejected the discrimination claim (but upheld the victimisation claim).

The Employment Appeal Tribunal held that the Employment Tribunal had failed to consider whether the aims could have been met by a retirement age other than 65 and remitted the case on that point alone. The Court of Appeal dismissed Mr Seldon’s appeal. He then appealed to the Supreme Court. 

The Supreme Court has now unanimously rejected the appeal and remitted the case to the Employment Tribunal to consider whether the choice of a mandatory age of 65 was a proportionate means of achieving the legitimate aims of the partnership.

Employees across the globe have experienced unprecedented economic turmoil, and, as a result, are restless regarding future career goals. Many are unhappy in their jobs and are actively searching for new opportunities. Others are content with their current employment position but are seeking greater engagement and meaning from their positions.

These findings are part of the latest survey results from the Kelly Global Workforce Index, an annual survey conducted by Kelly Services.

Overall, less than half (44%) of the global workforce feels valued by their employer and two-thirds (66% intend to look for a new job with another organisation in the next year.

The survey finds that among the main workforce generations, Gen X (aged 31-48) are more likely to be thinking about resigning their current jobs than either Gen Y (19-30) or Baby Boomers (49-66).

The survey results also found when evaluating potential employers, the number one factor job seekers regard or consider is corporate brand/reputation (58%) followed by location (52%). In essence, the corporate brand is becoming the employment brand, and resonates strongly with candidates as they weigh their employment options, especially for skilled professional and technical employees.

Across the generational groups, the way that individuals weigh their job choices varies as people age. Personal fulfillment/work-life balance becomes progressively more important as people mature, and is the predominant consideration among Baby Boomers. But for Gen Y, when choosing to accept one job over another, the leading consideration is personal growth/advancement. Among all generations, personal fulfillment/work-life balance and personal growth/advancement both outweigh compensation and benefits when choosing one job over another.

New figures have shown that employers are struggling to hang on to workers, despite the turbulent employment market, with more than 283,000 managers walking away from their jobs in the 12 months to September 2011.

The 2012 National Management Salary Survey, published by the Chartered Management Institute (CMI) and XpertHR, collected data from 38,843 individuals across 160 UK organisations. The survey revealed that nearly one in ten managers (9.4%) resigned from their jobs last year – more than twice as many as quit the year before (3.9%). Overall labour turnover for management roles – those resigning, retiring, transferring internally and being made redundant – has also increased dramatically, almost doubling from 10.5% in 2011 to 20.3% this year.

Christopher Kinsella, Acting Chief Executive of CMI, says: “Employers are struggling to recruit and to retain high quality managers. One in ten managers resigned from their jobs last year, presumably for better offers elsewhere. However, there is a risk that a substantial proportion of these managers left the profession altogether, a grave situation when UKCES/Government data estimates that the UK needs 544,000 new managers by 2020.”

The European Commission's latest annual report on gender equality has found that improving equality between women and men is essential to the EU's response to the current economic crisis.

"The economic case for getting more women into the workforce and more women into top jobs in the EU is overwhelming," said Viviane Reding, Vice-President of the European Commission in charge of Justice, Fundamental Rights and Citizenship. "We can only reach our economic and employment goals by making full use of all our human resources – both in the labour market as a whole and at the top. This is an essential part of our economic recovery plans."

In the labour market, the employment rate for women is 62.1%, compared to 75.1% for men, meaning the EU can only reach the overall Europe 2020 target rate of 75% employment with a strong commitment to gender equality.

Under the Europe 2020 strategy, the Commission has highlighted the need to promote a better work-life balance, in particular through adequate childcare, more access to flexible working arrangements, and by making sure tax and benefit systems do not penalise second earners. These can all help to make sure more women enter and remain in the labour market.

The gender pay gap has narrowed slightly across the EU. On average, women earn 16.4% less than men for every hour worked. The gender pay gap is caused by multiple factors such as labour market segregation and differences in educational choices. Slow progress in narrowing the gender gap in company boardrooms led the Commission to launch a public consultation on possible measures at EU level to address the problem, which risks holding back innovation and growth in Europe.

A recent website poll by the Chartered Institute of Payroll Professionals (CIPP) on the introduction of GP fit notes has found that 90% of employers do not believe they are effective.

The GP fit note, or Statement of Fitness for Work as it is formally known, was introduced in April 2010, following a review of the health of Britain's working age population by Dame Carol Black. In her review, Dame Black found evidence that some employers are reluctant to contact absent staff for fear of being accused of harassment.

According to the CIPP, the fit note was introduced as a tool to encourage conversations between employers and employees about how an earlier return to work, including a phased or adjusted return, could be facilitated.

Diana Bruce, Senior Policy Liaison Officer at the CIPP, commented that “Managing sickness absence is a challenging and often sensitive issue for employers so if the communication channels are open from the outset with clear company policies, the easier the process should be for both employers and employees.”

Employment tribunal changes have come into effect from Friday 6th April as part of the Government's employment law reform measures.

There were 218,000 tribunal claims in 2010-11, a rise of 44% since 2008-09, with each business spending nearly £4,000 per claim on average defending itself. There is an additional average cost of a £1,900 to the taxpayer per claim.

The changes mean that from 6th April:

• The qualifying period for claiming unfair dismissal will rise from one to two years.
• Judges will be able to sit alone in unfair dismissal cases.
• Witness statements can be provided in writing as opposed to the current rules where a witness reads their own statement out aloud.
• The maximum level for costs awarded to businesses winning a vexatious tribunal claim will rise from £10,000 to £20,000. Deposit orders required by claimants when a judge determines that a part of claim is unmerited will increase from £500 to £1,000.

The Government has also announced its intention to publish the average value of awards and time taken to reach a hearing. Included in the guidance for tribunal application and response forms, this information will provide all parties with a greater understanding about what to expect from the tribunal process before they enter the system.

The 2nd European Opinion Poll on Occupational Safety and Health has concluded that job-related stress is a concern for the large majority of the European workforce.

The survey, conducted by Ipsos MORI on behalf of the European Agency for Safety and Health at Work (EU-OSHA), found that eight in ten of the working population across Europe think that the number of people suffering from job-related stress over the next five years will increase (80%), with as many as 52% expecting this to ‘increase a lot.’

Work-related stress is one of the biggest health and safety challenges faced in Europe, representing a huge cost in terms of human distress and economic performance. The poll additionally found that the large majority of Europeans (86%) agree that following good occupational safety and health practices is necessary for a country’s economic competitiveness, with 56% strongly agreeing.

The poll also found that 87% of the general public across Europe believe that good occupational health and safety practices are important to help people work for longer before they retire.

A recent Eurobarometer survey shows that many Europeans are ready for active ageing but their current occupational safety and health conditions might not allow them to continue working to an older age.

Although the typical pensionable age is 65 years across Europe, the average exit age from the labour force in 2009 was about 61.5 years according to Eurostat. In the Eurobarometer survey, four in ten (42%) Europeans believe that they will be capable of doing the work they are currently doing until the age of 65 or beyond, while 17% expect that they will not be able to carry on in their current job past the age of 59.

A recent report from work-life charity Working Families has revealed that many parents are facing impossible choices and discrimination at work.

The report, which was based on calls to the charity's free legal advice line, found that employers are less willing to consider a variety of working patterns, and are imposing changes which undermine parents’ ability to combine work and childcare.

The report also revealed that 8% of calls in 2011 concerned pregnancy and maternity discrimination, including callers dismissed when they told their employer they were pregnant, demoted on their return to work, and unfairly selected for redundancy.

Other callers reported that they could not afford to return to work after childbirth, because of high childcare and travel costs, while parents of disabled children could not find any affordable, appropriate childcare.

The Office for National Statistics has published its Annual Survey of Hours and Earnings, which is based on a 1% sample of employee jobs.

Key points include:

• In April 2011 median gross weekly earnings for full-time employees were £498.
• For men, full-time earnings were £538, compared with £440 for women.
• Median gross weekly earnings for all employees were £400.
• Median gross annual earnings for full-time employees (including those whose pay was affectedby absence) were £26,100.
• Median gross weekly earnings for full-time employees were highest in London at £649 and lowest in Northern Ireland at £446.
• There were 297 thousand jobs paid below the National Minimum Wage held by people aged 16 and over, which constitutes 1.2% of all employee jobs in the labour market.

Government plans to enable micro firms to dismiss employees without good reason risks creating a perverse barrier to economic growth by discouraging small businesses from hiring more workers.

This is the view of the Chartered Institute of Personnel and Development (CIPD) in response to the call for evidence by the Department for Business, Innovation and Skills on proposals to introduce compensated no fault dismissals for firms with fewer than ten employees.

Under a system of compensated no-fault dismissals, businesses with fewer than ten employees (known as micro businesses) would be able to dismiss a worker, where no fault had been identified on the part of the employee, with the payment of a set amount of compensation.

Mike Emmott, employee relations public policy adviser at the CIPD, said:

“There is no economic case to be made for the watering down of employment rights for businesses of any size. Businesses have far more to lose in lost productivity from a de-motivated and disengaged workforce than they stand to gain from the ability to hire and fire at will. The consequences for the UK’s economic growth could prove particularly perverse when it comes to micro-businesses, who may be discouraged from hiring their tenth worker and may even struggle to recruit high calibre employees because they are seen as low-road employers.”

Proposals to examine the current dismissal process have been announced by the Government with the publication of a Call for Evidence.

Through the Call for Evidence, the Government is seeking to establish a strong evidence base on the current understanding of the dismissal process, including awareness, understanding and use of the Acas Code of Practice on Discipline and Grievance. The Government will be seeking the views of employees, business organisations and all other interested parties.

The Government has also published the Employment Law Review annual update in the Houses of Parliament, outlining how the review has been taken forward. The report summarises the current programme and looks ahead to further areas it is considering as part of the Review.

In addition, it was also announced that the Employer’s Charter, first published in January 2011, has been updated to include pointers on sickness absence and recruitment. The Charter aims to counter the misconception that employment protections are all one-way - towards the employee. It will give greater clarity to managers on what they can already do to deal with issues in the workplaces, on subjects such as performance, sick leave, maternity leave, requests for flexible working and redundancy.

Small businesses are looking to employ in the coming months as small business confidence picks up after a quarter of shedding staff, new figures from the Federation of Small Businesses (FSB) show.
 
Figures from the FSB's ‘Voice of Small Business' Index shows a net balance of 8.1% of small firms laid off staff in the three months to February – the highest figure since the survey began, in some cases partly due to rises in wages rises eating into 28.2% of firms margins.
 
Though hiring intentions among small firms may be picking up, unemployment is still set to rise this week – especially youth and female unemployment.

The FSB is calling on the Government to help small firms take on staff in the Budget later this month to help stem rising unemployment by putting measures in place, such as:

• Increasing the National Minimum Wage for apprentices to £123 per week – eight in ten small firms have said they would support a rise in apprenticeship wages.
• Ensuring Work Trials are made available to all suitable candidates on demand with no complicated qualifying criteria.
• Introducing fees for the majority of claimants at employment tribunals to reduce the number of serial claimants and speculative claims, or those which have little foundation.
• Encouraging small businesses to offer jobs they place with Jobcentre Plus as a Work Trial opportunity.

A recent Eurobarometer poll has found that 47% of those interviewed believe that the gender pay gap is best tackled at EU level. However, respondents were almost evenly divided on how best to close the gap.

While the pay gap between women and men doing the same job with the same qualifications is seen as a serious problem by almost seven in ten Europeans (69%), respondents were divided on whether incentives or penalties would be more effective in reducing the gap.

The three possible remedies offered, namely "facilitating access for women and men to any type of employment" (27%), "imposing financial penalties on companies that do not respect gender equality" (26%), or "transparent pay scales in companies" (24%), all scored similar percentages.

When asked at what government level these measures are best taken, 47% of those interviewed said they favoured action at EU level, 38% at national level and 11% at local level.

Unsurprisingly, women saw gender inequalities, and the pay gap in particular, as more of a problem than men did. More than three in four women said that the gender pay gap is a serious problem (76%), compared to 62% of men. More men (35%), than women (21%), said that it was not a serious problem.

When asked about pay trends, 60% of respondents said they thought gender inequalities had decreased over the past ten years, whereas 12% thought that there had been no change.

The British Chambers of Commerce (BCC) has called for the government to do more to lift the burden of regulation on business.

Responding to the publication of the government’s Statement of New Regulation, John Longworth, Director General of the BCC, said:

“Although the costs faced by businesses have been reduced, the government has not gone far enough in terms of real deregulation in key areas such as employment. There is still a long way to go if ministers are to honour their pledge to be the first administration to leave office having significantly reduced regulation.

“Businesses tell us they are still not feeling the burden of regulation lifting. Although doubling the unfair dismissal qualifying period to two years will boost business confidence to hire, more changes are needed to create a hard-hitting and comprehensive deregulatory package.

“This includes reforming redundancy rules, introducing no-fault dismissal and tribunal fees and sufficient action to implement promised health and safety changes. Reforms to mitigate the effect of the removal of the Default Retirement Age must also be put in place. With unemployment so high, it is crucial that these changes are implemented without delay to give businesses confidence to invest and grow.

“The regulatory process must be made more robust and transparent, with the volume of proposals deemed out of scope through the One-in, One-out System reduced. Furthermore, the recommendations made by the Regulatory Policy Committee should be published so the government can be held to account for their promises. This will also help to prevent any single minister or department from creating burdensome and costly new red tape.”

A recent study by the International Labour Office (ILO) has found that the current financial crisis has led to a significant increase in workplace inequality across Europe. 

The study, 'Work Inequalities in the Crisis: Evidence from Europe' analyses how workplace issues, such as working conditions, wages and incomes, employment and gender equality have been deteriorating across the continent since the start of the crisis.

“The central message of this volume can be summarized in simple terms: not only did work inequalities contribute to generating the economic crisis, but these inequalities have even become worse as a result of it”, says Daniel Vaughan-Whitehead, the ILO’s Special adviser, and editor of the book.“Our general economic system will thus continue to be at risk until we properly address this critical issue.”

Key findings of the study include:

• Wage differentials between the top and the bottom earners increased in countries like Bulgaria, Hungary and the United Kingdom.
• Young people are experiencing unemployment rates nearly double those among older workers in the majority of European countries.
• Despite male workers being initially more affected by the crisis than women, discriminatory practices against female workers have worsened over the past years.
• Women employed in male-dominated sectors were the first to be dismissed or experienced higher wage cuts than men.

The TUC has warned against reducing consultation rights during collective redundancy exercises, claiming that it could cost jobs, damage workforce morale and increase unemployment.

The government is considering whether the 90-day consultation period, which applies when more than 100 jobs are at risk of redundancy, should be reduced to make it easier, quicker and cheaper for employers to lay off staff. The TUC argues that cutting back these consultation rights would be detrimental for employers, employees and the wider economy.

Longer consultation periods provide time for employers and unions to explore all alternatives to redundancies, including identifying new orders, efficiency savings, restructuring, and recruitment freezes.

According to the TUC, the 90 days minimum consultation periods provide time for effective redeployment exercises, to ensure any selection processes are fair and for employers and unions to agree redundancy packages which assist workers in getting training and paying bills until they find new employment. It also provides time for union learning reps and government agencies to provide access to training, advice and job search support to those at risk of redundancy.

The TUC believes any reduction in the 90 days minimum consultation period will send a signal to employers that they need not prioritise exploring ways of saving jobs. This could lead to increased unemployment and more reliance on the welfare benefits, and would also have a detrimental impact on local economies and communities - particularly those areas of the UK where unemployment is already high and where there are limited job vacancies.

A recent report has revealed the extent to which women are under-represented in senior executive and management positions across Europe.

According to the data published by Mercer, the ratio of senior executives and managers that were female averages 29% in countries across Europe compared to 71% of men. Mercer has also revealed that despite organisations’ efforts to achieve a diverse workforce, the majority (71%) do not have a clearly defined strategy or philosophy for the development of women into leadership roles.
 
Sophie Black, Principal in Mercer’s Executive Remuneration team, said “Women’s representation on company boards is a big issue and there is substantial noise in the EU about board diversity. It’s not just an issue of gender, of course, although discrimination in any form is undesirable. It’s also an issue of talent as it this sort of bias in a company limits the candidate pool and skill set. A more diverse workforce reduces turnover and absenteeism and increase innovation and creativity,”

The EU is committed to addressing gender inequality and the Gender Pay Gap as part of its EU Gender Action Plan. While there is opposition to the imposition of politics into the workplace, Mercer’s data underscores the role that political intervention can play in balancing the inequalities created by market forces. According to the data, former Soviet-bloc countries have the highest levels of female participation and equality in Europe. In fact, the nine countries showing the best representation of women in senior positions are ex-communist states.
 
In Western Europe, the countries with the greatest proportion of women in the executive suite amongst the sample group were Greece and Ireland (33%), followed by Sweden (30%) and Belgium (29%). Spain, UK and France all had 28% female representation.

Quota systems to increase women’s representation in business have been in existence for several years in countries like Spain, Norway, France, Belgium and Italy. In the UK, the government is taking steps to improve women’s representation in the boardroom following Lord Davis report Women on Boards which recommends increasing the proportion of women executives on boards of the FTSE 350 group of companies to 25% by 2012.
 

In its response to a government call for evidence on TUPE, the TUC warns that changing current legislation could also lead to an increased involvement of the private sector in public services, with contractors competing for business on lower wages rather than on the quality of the service they provide.

TUPE protects employees' terms and conditions of work when a business is transferred from one owner to another. Staff automatically become employees of the new employer on the same terms and conditions as they were on before, and their continuity of service is also protected.

The TUC argues that TUPE regulations also benefit employers by creating a level-playing field for businesses and enabling restructuring to take place more easily and without disputes.

The government is considering increasing the flexibility for employers to cut pay and conditions after a transfer takes place. This could lead to a race to the bottom, warns the TUC, with companies using low wages to compete for contracts in the public and private sector, rather than by quality of service, efficiency or innovation.

Current TUPE regulations also maintain employment levels, as new employers must retain original staff when they take over a business, argues the TUC. Cutting back on this vital right means employees could lose their jobs when the owner of their company changes, which would increase unemployment and reliance on welfare benefits.