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27th June, 2014

Three Hot Topics in Employment Law


Helen Watson, Head of Employment at Aaron & Partners LLP, highlights the latest developments in Employment Law which businesses should be aware of. Acas Early Conciliation As part of plans to make the Employment Tribunal system more efficient Acas has launched Early Conciliation whereby prospective claimants are required to complete the Early Conciliation process before presenting a claim to the Tribunal. Early Conciliation became mandatory for all claims presented to the Tribunal on or after 6 May 2014. The Early Conciliation process begins when a prospective claimant, who is considering presenting a claim to the Tribunal, notifies Acas of that intention through an Early Conciliation form. The form can be submitted either online or by post. Early Conciliation is for a one month period, to allow the parties to attempt conciliation. If conciliation is not possible, or the conciliation period comes to an end before settlement has been possible, Acas must issue a certificate to the prospective claimant to that effect. Receipt of this certificate enables the prospective claimant to submit a claim. Without the reference number on the certificate, a claim will be rejected by the Tribunal. It is important to note that although the Early Conciliation process is mandatory, engagement in conciliation is actually voluntary. If either party decides they do not want to engage, Acas will simply issue the Early Conciliation certificate and the prospective claimant can continue their claim to the Tribunal. Employment Tribunal Fees In July 2013, Employment Law saw one of the major changes arising from the Enterprise and Regulatory Reform Act 2013 come into force with the introduction of fees in the Employment Tribunal. The introduction of fees has been controversial, with several arguments that the regime limits claimants’ access to justice. Two fees are payable to the Tribunal. The first is paid on issue of the claim and the second prior to the final hearing. The level of fees varies between types of claims and the number of claimants involved. However, in most cases, altogether fees are likely to be in excess of £1,000. New statistics have shown that between 29 July 2013 and 31 December 2013, a mere 24% of all remissions applications were granted by the Tribunal. It should also be noted that this figure includes remissions that were granted only in part. This statistic is concerning as it accounts for just 5.5% of all claims submitted to the Tribunal during the relevant period. On introduction of the fees regime last year, it was originally anticipated that 31% of claimants would be eligible for fee remissions but the latest figures significantly depart from that. We will await further updates on this topic, bearing in mind that the judicial review application against Tribunal fees was recently dismissed. It will be interesting to see whether these statistics spark a further application. Case update: Holiday pay should include commission Following a referral from the Employment Tribunal, the CJEU held variable elements of pay should be included in an employees’ holiday pay in the case of ZJR Lock v British Gas. Mr Lock was employed by British Gas as a salesman and was paid a basic salary together with a sales-related commission. This meant that the amount of commission Mr Lock received varied from time to time and was, at all times, subject to the sales he made. Whilst on annual leave, British Gas calculated Mr Lock’s holiday pay using only his basic salary, meaning that he lost part of his usual earnings. Following a preliminary ruling by Advocate General Bot, the CJEU has found that whilst on leave, employees must be paid a comparable amount to what they would have earned, had they been at work. The CJEU held that the underlying principle of the Working Time Directive is to allow employees to take leave and that they should not be deterred from doing so due to financial considerations. The CJEU has however left national courts to decide exactly how holiday pay should be calculated to take into account variable elements of pay. This is an important development for employers and employees alike. Although it may take some time for an amendment to the Working Time Regulations it is important to ensure that your business’ policies and procedures are compliant with this latest ruling. For further information and advice in relation to the latest developments in employment law, please contact Helen Watson on 01244 405565 or send an email to [email protected].



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