Employment tribunal fees are unlawful, court rules

Employers are bracing for a surge in tribunal claims after the government agreed to scrap fees for them and pay back £27 million.

Ministers said that they would take immediate steps to refund payments after the Supreme Court upheld a challenge by Unison that the charges were discriminatory.

The court ruled that the government was acting unlawfully and unconstitutionally when it introduced the fees in 2013 for claims such as unfair dismissal, equal pay and redundancy. The charges of up to £1,200 led to a 70 per cent drop in the number of tribunals in England and Wales and were condemned as impeding access to justice.

Dominic Raab, the justice minister, said: “The Supreme Court recognised the important role fees can play, but ruled that we have not struck the right balance in this case.”

Unison welcomed the ruling, which it said would mean more than £27 million would be paid back to nearly 250,000 people charged since July 2013, when the fees were introduced by Chris Grayling, the lord chancellor at the time.

Dave Prentis, general secretary of the union, said: “When ministers introduced fees they were disregarding laws many centuries old, and showing little concern for employees seeking justice following illegal treatment at work.

“The government has been acting unlawfully, and has been proved wrong — not just on simple economics but on constitutional law and basic fairness too. It’s a major victory for employees everywhere.”

David Isaac, chairman of the Equality and Human Rights Commission, said: “The right to justice must be based on the merit of your case, not your ability to pay. Thousands may have been denied of this right and priced out of getting justice. The judgment of the Supreme Court is a damning verdict on the current regime.

“The law only works if people know that it is a fair and just system and the biggest and strongest will not always win. Women face a double penalty with high fees and short timescales to bring maternity discrimination cases.”

Charlie Mullins, the millionaire founder of Pimlico Plumbers and a Conservative Party donor, described the court ruling as disgraceful. He told World at One on BBC Radio 4 that the benefit of leaving the European Union would be to get rid of “this stupid law”.

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Employee imprisoned following Court Order after sending confidential e-mails to home address!!

A recent ruling in the High Court serves as a reminder to all business owners, especially recruiters, of how important it is to ensure that contracts of engagement with employees and other personnel include strong provisions protecting your confidential information. For those in the recruitment sector this means your databases of candidates and clients – such information being the lifeblood of your business.

The facts – OCS provided aircraft cleaning services to British Airways at Heathrow, that contract was lost to a competing company, Omni Serv which took over supply of the services and transferred OCS’ staff under TUPE regulations.

Just before the transfer OCS became aware that several of their employees had transmitted OCS confidential documents and information to their home email addresses and passed them to third parties, in breach of restrictions in their employment contracts and the duty of confidence. OCS immediately applied to the High Court for an interim injunction prohibiting the employees from disclosing the information, which the Court ordered. The order also imposed an obligation not to destroy any evidence or to disclose the existence of the order.

Shortly afterwards, one of the defendants disclosed to his manager, a trusted colleague, the fact that an order had been made and then, over several days, proceeded to delete some 8000 emails. On discovering this OCS applied back to the Court which decided to send the employee to prison for 6 weeks for breaching the order.

Even though the employee breached the court order OCS was able to protect its confidential information, and this case demonstrates the serious consequences that can flow from the breach of restrictions in an employment contract. No doubt the employee is regretting his actions! Key to this however is having the right protective terms properly set out in the employment contract, a message that all businesses should heed if they are worried about loss of confidential information.

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Bosses told not to spy on social media!

Employers who snoop on the Facebook pages of staff and job applicants are likely to be breaking the law.

The heads of Europe’s data watchdogs said that companies needed legal grounds before screening the social media pages of potential recruits. Any searches must be necessary and “relevant to the performance of the job”.

In new guidance, a working party that includes the UK Information Commissioner’s Office and regulators from other member states, said: “Employers should not assume that merely because an individual’s social media profile is publicly available they are then allowed to process that data for their own purposes.”

It added: “It can be argued that it most likely will not be legitimate to review an applicant’s Facebook profile regardless of whether it is public or not, but that a LinkedIn profile will be OK to process data from.”

They said jobseekers should be told if an employer intends to screen their social media profiles. Employers cannot force them to accept friend requests or hand over passwords, they added, and screening of existing employees’ profiles should generally not happen.

About 60 per cent of employers screen the social media pages of job applicants, according to a survey by CareerBuilder, a recruitment company.

The working party does not make EU law but advises on its consistent application. Its opinion will inform the interpretation of the general data protection regulation, which will come into force next May, and which Britain will continue to implement after Brexit.

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More people in work but real wages are back to 2015 levels

Real wages have fallen for the first time in 30 months despite a drop in unemployment to a level last recorded in 1975.

The Office for National Statistics said that earnings growth excluding bonuses fell by 0.2 per cent in the three months to March, after accounting for inflation. Regular pay growth slipped to 2.1 per cent in March and on Tuesday figures showed that inflation jumped to 2.7 per cent last month. Inflation has accelerated since the Brexit vote as the fall in sterling has driven up the cost of imports.

The bleak news on incomes underscored the unusual dynamics in the labour market, as jobs growth has continued to race ahead. “Britain kicked off 2017 with a renewed jobs boom and a painful pay squeeze,” the Resolution Foundation, a think-tank, said.

Unemployment fell to 4.6 per cent in March, from 4.7 per cent, as 122,000 more people found work in the past three months, the ONS said. The employment rate, which measures the proportion of working-age people in jobs, hit another record of 74.8 per cent. At 31.9 million, the total number of Britons in work was also at its highest level.

Britain’s labour market is now tighter than it has been in four decades, with the number of people out of work per vacancy slipping below two for the first time on record.

At such low levels of unemployment, wages would normally be expected to rise rapidly. Instead they are roughly half the average pace of growth experienced before the financial crisis.

Pay rises have struggled to break through 2.5 per cent since the recession, leaving living standards exposed to the risk of rising inflation that has materialised since last June’s European Union referendum. However, the persistently weak rate of wage growth has been attributed to Britain’s poor productivity, which predates the Brexit vote.

Official productivity figures released yesterday suggested that there was little respite in sight. Productivity, which is key to future prosperity, fell by 0.5 per cent in the first quarter compared with the previous quarter as GDP growth slowed to 0.3 per cent and hours worked rose rapidly.

It was the first fall since the final quarter of 2015.

“The combination of rising inflation and poor productivity paints a grim picture for living standards,” Gerwyn Davies, labour market adviser at the Chartered Institute for Personnel and Development, said.

Confirmation of the pay squeeze raised concerns about the sustainability of Britain’s economic growth, which has in the past been dependent on consumer spending.

“As well as hitting UK workers in their pockets, this fall in real regular pay also potentially puts at risk an economic recovery that has been reliant on strong consumer spending,” Mr Davies said. His institute recently said that employers planned to restrict staff pay settlements to 1 per cent this year. The bank is expecting the economy to grow by 1.9 per cent this year, better than the 1.8 per cent recorded last year.

The Bank’s monthly agents’ report, released at the same time as the ONS data, said that “consumer spending growth had moderated in real terms, as spending power had been hit by higher prices”.

Yet it also noted that “recruitment conditions had tightened a little further, with skills shortages reported in a wider range of activities”.

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Demand for staff rises as availability falls at quickest pace since 2015

Demand for staff is at its highest level in 21 months as the number of people seeking jobs has fallen to a near-two-year low.

According to the Recruitment and Employment Confederation, demand for permanent and temporary staff rose in May as availability dropped at its quickest pace since August 2015.

With demand for workers increasing and supply shrinking, average starting salaries for permanent posts increased at the fastest rate in three months.

Although the survey echoed official data showing that joblessness is at its lowest in 42 years and employment at a record high, it contradicted official pay figures suggesting that earnings are as weak as they have been in a year.

Pay growth for permanent jobs has been accelerating for a year, the employment confederation said. For May, it found that “higher salaries were generally linked to candidate shortages and strong competition for skilled workers”.

The most recent data from the Office for National Statistics showed that wages were rising more slowly than the average of the past year and were lagging behind inflation.

Tom Hadley, director of policy at the confederation, said: “Employers are running out of options. Skill shortages are causing headaches in many sectors.”

The most sought after workers are engineers, nurses and care workers. There was also a sharp increase in demand for construction workers.

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Office workers sit tight as Brexit negotiations begin

White-collar workers are more reluctant to move jobs as the process of leaving the European Union begins, according to a survey of recruiters.

Availability of temporary staff declined in March at the fastest rate since January 2016 and also fell sharply for permanent staff, the Recruitment and Employment Confederation said.

Wariness about the jobs market is reflected in the behaviour of consumers. Retail sales fell at their fastest rate in nearly seven years in the three months to February, according to official figures.

“Economic uncertainty about future prospects is having a detrimental effect on employees’ willingness to risk a career move at this time, which seems to be driving down candidate availability,” Kevin Green, chief executive of the REC, said.

Staff shortages continued to push up the growth in starting salaries, although more slowly than in February, the confederation said. Information technology specialists and medical staff were among those workers most in demand.

Gertjan Vlieghe, a Bank of England rate-setter, said on Wednesday that slow wage growth in official data suggested that the economy could continue to grow without pushing up inflation, despite the unemployment rate falling to its lowest level since 2005.

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Sick days at lowest rate as fearful workers battle on

The number of days taken as sick leave has fallen to the lowest rate since records began, as staff struggle in to work through fear of losing their job.

About 137 million working days were lost to illness last year, equivalent to 4.3 days per worker, according to official figures. When records began in 1993 it was 7.2 days per worker.

The sickness absence rate — working hours lost to sickness as a percentage of total hours worked — now stands at 1.9 per cent compared with 3.1 per cent in 1993.

The Office for National Statistics (ONS), which compiled the figures, noted that the fall had been particularly dramatic since the economic downturn in 2007, suggesting that a lack of job security was a significant factor.

However, HR managers in the public and private sectors alike say that other changes have also had an impact. Many employers have introduced programmes to reduce sick days in recent years. For example, many insist that staff who are sick must speak in person to a manager on the phone rather than leave a message or email.

Perhaps even more significant is the rapid growth of working from home, they say, when staff who feel unwell will often carry out lighter duties rather than take a day off sick.

Frances O’Grady, general-secretary of the TUC, said that too many people were struggling in to work while suffering from colds or flu when they would be better off at home.

“We are really a nation of mucus troopers, with people more likely to go to work when ill than stay at home when well,” she said.

Research carried out by the TUC in the winter months found that half a million employees went to work despite feeling terrible because they did not like to let down their clients, colleagues or employer.

The rate of absenteeism in the public sector has fallen from a high of 4.3 per cent to 2.9 per cent, but it is still higher than the private sector’s rate of 1.7 per cent. Within the public sector, the health service had the highest rate of sickness, at 3.5 per cent.

Minor illnesses such as colds were the most common reason for missing work last year, accounting for 25 per cent of days, followed by musculoskeletal problems such as back pain, which accounted for 22.4 per cent.

Mental health problems including stress, depression, anxiety and schizophrenia resulted in 15.8 million days being lost — 11.5 per cent of the total. Stomach upsets accounted for 6.6 per cent and headaches and migraines 3.4 per cent.

Older workers take the most days off sick, with the rate among the over-65s being 2.9 per cent — higher than in 1993, when it was 2.7 per cent. They are followed by those aged 50 to 64, with a rate of 2.7 per cent, although this has fallen sharply since 1993 when it was 4.4 per cent. Those aged 25 to 34 take the fewest days off, with a rate of 1.5 per cent.

Employees have a higher rate of sickness absence than the self-employed. Last year it was 2.1 per cent for employees and 1.4 per cent for the self-employed. People in Wales and Scotland took the most time off for illness, while those in London and the southeast took the least, the ONS found.

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Low-paid are unaware of their rights

A poll carried out among low-paid workers by the Department for Business, Energy and Industrial Strategy shows widespread ignorance of their financial rights.

The government is launching an advertising campaign to raise awareness, and the poll of more than 1,400 workers earning less than £15,000 a year found that 69 per cent did not know they should be paid for travel time between appointments.

In addition, 57 per cent did not know that having money taken out of their wages to pay for their uniforms was unlawful and almost half did not realise that the tips they are paid cannot be used to top up their pay to the legal minimum.

The campaign comes before the rise in the national minimum and national living wage rates on April 1.

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Plumber’s victory will affect ‘gig economy’

A ruling in favour of a self-employed worker claiming sickness benefit from Pimlico Plumbers could have far-reaching consequences for contractors including accountants and IT professionals, according to lawyers.

The Court of Appeal rejected an appeal by Pimlico on the employment status of the former plumber Gary Smith.

Lawyers said that the ruling, coming three months after a similar verdict against Uber and another case against Deliveroo, would also affect the burgeoning “gig economy”, where people supplement their income with part-time work.

It could have implications for “restrictive covenants” — contractual constraints on working for competitors — that are commonly applied to contractor accountants and IT specialists.

Sean Nesbitt, an employment partner at Taylor Wessing, the law firm, said: “A business like Pimlico cannot have its cake and eat it. If it wants to say someone is self-employed, their economic freedom and ability to compete are an important feature of that status.”

Charlie Mullins, founder of Pimlico Plumbers, said after the ruling that self-employed workers could earn twice as much as if they were directly employed.

The body representing self-employed workers welcomed the ruling.

Jordan Marshall, a policy manager at IPSE, the Association of Independent Professionals and the Self Employed, said: “What is clear is there’s a great deal of interest in gaining clarity on what it means to be self-employed and where does freelancing begin.”

The Road Haulage Association has been warning that “bogus self-employment” is a growing problem for the industry. Jack Semple, head of policy for the RHA, said: “We’re talking about substantial sums of taxpayers’ money being lost, a growing culture of non-compliance and an undermining of the employment rights of lorry drivers.”

The RHA has raised the matter with Revenue and Customs, which said in a last year that it was “concerned by increasing pressure on haulage operators to treat workers wrongly as self-employed, or to hire workers through their own companies in ways that are not compliant with tax laws.”

Self-employment has grown from 3.8 million in 2008 to 4.6 million. The growth was strongest in part-time self-employment, which rose by 88 per cent between 2001 and 2015.

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Top employers to take on more graduates

Britain’s largest graduate employers plan to expand their recruitment of university leavers this year in a further sign of confidence in the economy.

The top 100 graduate recruiters are seeking to hire 20,985 to their management programmes, 868 (4.3 per cent) more than last year.

It will be the fifth consecutive year that leading employers have expanded their graduate programmes and is good news for students, who have become increasingly focused on their career prospects since university tuition fees trebled to £9,000 a year in 2012. The graduate recruitment market contracted sharply after the financial crisis in 2008, falling by 6.7 per cent, and dipped again in 2012 but has increased steadily since.

This year’s projected rise is the largest for four years and suggests that uncertainly over Brexit has not hit confidence.

Public sector employers; high street and online retailers; and engineering and industrial companies are among those preparing to hire more graduates in the coming year. Six organisations plan to increase their graduate programmes by more than 100 recruits.

The figures are based on a survey of the 100 best-known graduate recruiters by High Fliers Research, which found that a minority of employers are also increasing their starting salaries for graduates, although the average figure remains at £30,000 a year.

Law firms, who pay the second highest starting salaries to new graduates, are increasing their pay by an average of £1,000 a year, to £43,000.

Retailers are accompanying their expansion with higher pay, raising average starting salaries by £1,000 to £30,000, although Aldi, one of the most generous, plans to pay its trainee area managers £42,000 a year.

Oil and gas companies are also increasing their new graduates’ pay by £1,000 to an average of £38,000, although this sector is much smaller with only 160 graduate vacancies compared with thousands that are offered by accountancy and professional services firms.

Employers in the engineering and industrial sector, where pay tends to be significantly lower, are raising their starting salary by £500 to an average of £26,500.

The graduate recruitment market has been complicated in the past two years by students turning down jobs at the last minute to accept a better paid or more attractive offer. It has prompted calls among employers to revive a student code whereby applicants must withdraw other job applications once they have accepted an offer.

Some employers say they may be forced to scale back their investment in graduate training programmes if the trend continues, although there has been so sign of this yet.

The survey found that last year 800 positions on graduate programmes were left unfilled after applicants reneged on offers late in the process despite having previously accepted them. Public sector employers and accounting and professional services firms were hit the hardest.

The practice is also a symptom, however, of a trend among employers to make job offers earlier, owing to competition among recruiters to hire the best candidates. This includes offering positions to students who undertake internships in the summer vacation of their second year at university.

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