In June the Court of Appeal ruled that voluntary overtime payments must also be included in holiday pay calculations. It agreed with the Employment Appeals Tribunal’s ruling in the Flowers and others v East of England Ambulance Service NHS Trust case where ambulance workers claimed that two types of overtime should be included in holiday pay calculations; “non-guaranteed” overtime taken when their shifts overrun and any voluntary shifts they choose to take in advance.

The original ruling at Employment Tribunal held that voluntary overtime should not factor into holiday pay calculations, however the ambulance staff successfully appealed this ruling which then resulted in the East of England Ambulance Service NHS Trust taking the case to the Court of Appeal but the judgement ruled in agreement that voluntary overtime should be included in holiday pay if there are regular overtime payments.

When calculating holiday pay it’s important to remember that the following payments must be included in at least 4 weeks of paid holiday:

• Regular overtime payments (both voluntary and compulsory)
• Contractual commission
• KPI bonus payments

This is to ensure that employees’ salaries are not unduly affected when they take holidays and employees are not discouraged from taking their European entitlement of 4 weeks’ annual leave, in other words they should receive the same amount of money as if they had attended for work. This ruling has been in place for some time now, however many employers have not yet implemented it so the government plans to publicise this in the coming year as part of the Good Work Plan so that employees are more aware of their rights.

As part of the Government’s Good Work Plan, recommendations were made to extend the reference period for determining average pay in relation to statutory holiday from 12 weeks to 52 weeks. This is being brought into force by The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 and will apply from 6th April 2020.

A consequence of this will mean that contracts of employment templates will have to be updated to reflect the changes to holiday pay calculation.

To find out more about holiday pay, how to calculate it and ensure that your contract templates are compliant please speak to a member of the Solve. team

HR Masterclass seminar

Join us on Thursday 24th January 2019 at the Mercure Hotel for a free HR masterclass seminar.

Disciplinary and Grievance Masterclass

Disciplinary and Grievance issues affect all organisations at some point and if not done properly it can leave a Company exposed to an Employment Tribunal claim. The Masterclass will cover how to deal with disciplinary and grievances both informally and formally giving you the confidence to undertake such actions without breaching ACAS guidelines.  There will be lots of hints and tips for you to take away and implement and you will leave with clarity on the procedures and what you need to do to ensure that you have effective policies in place.

When: Thursday  24th January

Time: 8.45am for 9.15am start until 10.15am(teas and coffees provided)

Where:  Mercure Hotel, Almondview, Edinburgh EH54 6QB (plenty of parking)

Please feel free to share with colleagues and fellow business associates who you think might be interested.

 

To reserve your place please register on eventbrite below.

                                 REGISTER HERE

On 6th April 2018, and again on 6th April 2019, the rate for the minimum contribution to Workplace Pensions from both employees and employers is increasing.

All employers, with employees in a work place pension scheme, must take action to ensure at least the minimum amounts are being paid into their pension scheme.

This applies to you whether you set up a pension scheme for automatic enrolment or you decided to use an existing scheme.

If you’re using a defined benefits pension scheme then the increases do not apply.

Up to 5th April 2018
Employer minimum contribution 1%
Employee minimum contribution 1%
Total minimum contribution 2%

6th April 2018 – 5th April 2019
Employer minimum contribution 2%
Employee minimum contribution 3%
Total minimum contribution 5%

6th April 2019 – onwards
Employer minimum contribution 3%
Employee minimum contribution 5%
Total minimum contribution 8%

As an employer you can make the decision to move straight to the 6th April 2019 minimum rates from April 2018 if you wish to eliminate the need to make two changes.

By law a total minimum amount of contributions must be paid into the scheme.  You as the employer must make a minimum contribution towards this amount and your employee must make up the difference.  If you decide to cover the total minimum contribution required, your employee won’t need to pay anything.

This is not a change to pension scheme rules which requires legislative communications but we would recommend as good practice that you advise your employees in advance of the expected change to prepare them for the increase in their own pension contributions and your own pension provider should be able to help with this. With the contribution rate for employees tripling this will have a material impact on net pay for many.

If you offer a salary sacrifice we would advise you review communications issued and seek advice from your pension provider regarding any changes you may need to share with your employees.

There are also changes coming for the Auto Enrolment threshold rates:

  • Earnings trigger is to remain at £10,000 per annum.
  • Lower qualifying earnings will rise from £5,876 to £6,032 per annum.
  • Upper qualifying earnings will increase from £45,000 to £46,350 per annum.

In addition, ensure your contracts of employment and/or employee handbook reflect your new contribution rates and we can help with this.

hospitality and human resources

 

It is startling to read how many SME’s in the UK who don’t have HR support.  There can be many reasons for the lack of HR support, such as budget constraints.  SME’s mostly work on a tight budget and focus more on growth and scale of the business versus people and culture related issues. Many SME owners feel that their teams are too small and they can manage their HR activities adequately themselves.

Employers are not being properly educated about the disadvantages they face because of a lack of engagement with HR.

Most businesses – no matter how small – will have specialist support to manage finance, IT and operations, but, don’t realise the benefit of bringing in HR when it comes to the management of their (usually) most valuable asset – their people.

Common issues we are often asked to help employers resolve:

1.     Poor pre-recruitment screening, with promotion decisions based on length of service, not quality of skills, often leading to poor retention rates of the right people who become frustrated working with people in the wrong roles.

2.     People are moved to new roles because they’ve been with the business a long time, not because they have the right skills and experience to succeed in their new role.  This leads to informal conversations with no documentation used to measure performance accurately.

3.     Lack of training and coaching given.

4.     “Warnings” issued on the spot with no documentation to support decisions, and no formal procedures being followed.

5.     No formal policies and procedures in place meaning there is no protection for the manager, the employee or the business.

6.     Absence is not managed, documented or controlled with no return-to-work interviews in place, which often leads to unhappy employees who are picking up the workload of absent colleagues.

7.     Employees unhappy with the way they are managed but feel the culture of the organisation is one that there is no-one to listen to their complaints, or no process for them to lodge a complaint.

8.     No contracts of employment or job descriptions, leading to confusion over terms and conditions and job roles and responsibilities.

Having HR support in your business can mitigate these risks and many others.  As you get in place contracts of employment (which are essential for you to comply with legislation) and structure your policies and procedures with clear standards for managing both good and bad performance, this helps builds engagement and trust.

Well laid out HR practices, these help to remove ambiguities employees may have related to their job role in the business and can help improve employees’ motivation, improve Line Managers skillset in managing people, business efficiency and reduce attrition.

There are many ways to engage with us to ensure your HR support is affordable, the argument that HR is a luxury to SME’s should be revisited before you face the financial consequences of leaving it too late.

HR consulting services

HR consulting services

As an HR and Employment Law Consultancy, we’re often asked to speak with prospective Clients who are ‘beauty parading’ a number of HR consultancies before deciding on the right one for them.  Often, what happens though is much like when you love all the things on a restaurant menu or try too many beautiful fragrances in a local department store – they can’t decide!

They see that there are differences – style and approach to managing HR dilemmas, culture fit with their business or even just plain old fashioned price, but most of the time, the consultancies offerings merge into one and they just can’t determine what consultancy would best meet their needs.  Sound familiar?

If you are scratching your head trying to decide what provider is right for you, we’re here to help!  Here are our top ten things to consider when choosing and using your HR supplier – no bias – promise!

  1. Know what your HR needs are

Are you a small start up business with one employee or a more established SME with a number of staff?  It’s very common in today’s fast paced marketplace that businesses can grow at a rapid rate and often, what worked for you as a start up, can quickly become out of date.  Therefore, when choosing your HR supplier, you need to be really clear on what your HR needs are today and what they are likely to be tomorrow and choose an HR supplier that is flexible and skilled enough to deliver both.  Do you want a call centre or IT solution that you can contact/use 24/7 or do you want a face to face solution?  Do you want to be sent templates to complete or letters prepared for you and ready to send?  Do you want only the Directors of the business to liaise with your HR supplier or do you have managers that require HR support also.  By establishing your current and future needs, you will be more prepared for any supplier meetings and may even be able to de select potential suppliers just by looking at their website!

 

  1. Evaluate their expertise

How many times have we gone into businesses where the owner tells us that they have the HR basics covered, contracts of employment, employee handbooks, absence management etc.  Sometimes of course this is all there and more and is a great foundation for advanced HR strategy and practice, but often, when we review these documents, they are at best ill thought out or at worst out of date legally.  This leaves the business and its Directors exposed to legal risk.  It pays to check who you are partnering with in advance – how long has the consultancy been in business?  What’s their operational structure?  Who will be dealing with your issues on a day to day basis and what are their qualifications? How often will the supplier update your paperwork and ensure that it complies with legislation?  Can they carry out small and larger scale change projects? Have they ever been to a tribunal?  These and many other questions will soon tell you about the credibility of your supplier and their expertise.

 

  1. Eye up the competition

No business owner has time to meet with every HR supplier that’s out there; however, once you have established your needs, you can quickly pick which suppliers you want to meet with.  Our advice would be to keep those meeting numbers low – maximum three potential suppliers.  Any more and your head will be swimming with choice and you will be left in the scenario of not knowing who to choose for the best.

 

  1. Establish if there’s a culture match

Now you have chosen the three suppliers you want to meet with and evaluated their expertise – it’s time to look at what kind of business they are.  What are the Directors/Business Development Manager like?  Are they aloof or down to earth?  Do they appreciate your challenges and have empathy with you?  Will they work with you as a business partner or are they simply there to get the deal?  How do they treat their staff? How long has their team been established?  Questions like these really focus the mind on how alike the supplier is in terms of culture and fit and will help you make a better choice

 

  1. What are they offering?

HR suppliers can vary in terms of what services they offer and how these are packaged for Clients.  It pays to choose a supplier who can be flexible to meet your needs.  Sometimes, before you sign up to a retained agreement, you may want to ‘try before you buy’ and work with your preferred supplier on a small piece of work to confirm that you can work together and that you are happy with their style and approach to dealing with your HR challenges.  If a supplier can’t offer you this – why not?  Retained agreements are great for both Client and supplier, however, if the supplier is the right one for you, they should work with you in a way that makes you feel the most comfortable before signing you up to any longer term commitment.  Of course you may want to commence a retained agreement immediately and that’s great.  Just make sure you are happy with all the terms of the agreement before doing so.

 

  1. What else can you do for me?

As your relationship with your HR supplier becomes more of a partnership, you may wish to use them to support other people related processes in your business.  Recruitment is a great example of this.  Recruitment can be a time and cost drain on your business and it can be a weight off your shoulders to work with a trusted partner to support you in getting it right.  However, many HR suppliers don’t offer additional services such as Recruitment either as part of their retained agreements or as a stand alone offering.  Therefore, it pays to check that your supplier offers the full spectrum of HR activities and has in house expertise in these areas that can help you when you need.

 

  1. Take up References

As you would with any new employee, we would always recommend taking professional references before committing to a supplier.  If they are as good as they say they are, then they should be able to provide at least 2-3 professional references from businesses, similar to your own, that you can speak to independently and ask any questions that you may have regarding the business as a supplier of professional HR services

 

  1. So what’s the deal?

Once you have agreed how you will work with your supplier and taken references, you need to review and agree to business terms.   As best practice, your preferred supplier should have provided you with a written proposal for the work to be undertaken, including the detailed elements of that work and any related costs.  Be sure to clarify what exactly the costs include and exclude e.g. project work and provision of third party services such as Occupational Health Consultations may be charged separately from any retained agreements.   Once you have agreed to the proposal, the supplier should follow up with a contract for services.  Any contractual agreement should be reviewed by Client and Supplier on an annual basis and should be flexible enough to be revised by both parties as required at that stage.

 

  1. Measuring Success

Your HR supplier, should, over time, be able to demonstrate how they are positively impacting on your business.  Once you commence working with your supplier, it might be a good idea to sit down and discuss with them how you will, together, ensure a return on investment.  Whether it’s reduced absence or turnover rates, increased employee satisfaction and engagement, your HR supplier should be able to establish early on how their success can be measured, should you choose to do so

 

  1. Use your HR service!

Finally, whilst you may not have HR issues arising daily, it pays to communicate actively with your supplier and discuss with them pro active HR strategies such as engagement, employee communication and involvement and so on.  Remember HR is not just about being reactive and fire fighting but getting the most from your people for business benefit.  There will always be something to do and your HR supplier should support you in finding the ‘magic dust’ that will take your business from good to great!

 

Contact Solve today to discuss your needs.

Employer Right to Work Checks

The UK’s Data protection rules are set to dramatically change with the introduction of the EU’s General Data Protection Regulation (GDPR) on 25th May 2018.  The new regulations will involve significant changes to how organisations process data.  The new restrictions being brought mean that there will greater penalties for failing to meet data protection regulations.  The introduction of GDPR will have a serious impact on employers in terms of how personal data is processed and stored for not just employees but also for contractors and job applicants.

Don’t let Brexit allow you to think that GDPR won’t apply to the UK as we will still be in the EU when the new legislation comes into force and it is likely that the UK Government will adopt the same or similar legislation when we do eventually leave the EU.

Breaching the law could subject a company to significant fines of up to €20 million, or 4% of an organisations’ global annual turnover, whichever is higher.

The major changes that GDPR will have on HR information are:

1.     Data protection by design and default – A new approach to data that will require organisations to embed privacy considerations in both operational and strategic HR. Employers need to ensure that only personal data necessary for each specific purpose is processed. This includes ensuring that:

  • only the minimum amount of personal data is collected and processed for a specific purpose;
  • the extent of processing is limited to that necessary for each purpose;
  • personal data is stored for no longer than necessary; and
  • access to the data is restricted to that necessary for each purpose.

2.     Processing by consent – Many employers process employee personal data based on consent. This approach has been increasingly criticised, as the validity of employee consent is questionable due to the imbalance of power in an employment relationship. Under GDPR consent must be “freely given, informed, specific and explicit”. Where an employer obtains consent in a written declaration that also concerns other matters, the request for consent must be presented in a manner that is clearly distinguishable from the other matters, in an intelligible and easily accessible form, using clear and plain language. This means that broad consents in employment contracts to process employee data will not be valid. Further, the requirement that consent be freely given means that valid consent will generally be difficult to obtain in the employment context due to the imbalance of power.

3.     Legal basis for processing – There will be a greater focus on the legal basis for processing personal data under the GDPR. As processing employee data on the basis of consent will be problematic, employers will need to rely on other grounds, including that processing is necessary for:

  • compliance with a legal obligation;
  • the performance of a contract; or
  • the purposes of the legitimate interests of the employer or a third party.

If an employee objects to processing based on legitimate interests, the employer cannot process the data unless it shows that its legitimate interests are sufficiently compelling to override the interests or rights of the employee, or that the purpose of processing is to establish or defend legal claims. The right to object could cause significant delay and disruption in the context of disciplinary or grievance procedures, redundancies, terminations of employment or business sales.

4.     Information for employees and job applicants  – Under the GDPR, employers will be required to provide more detailed information than under the Data Protection Act 1998 to employees and job applicants about the processing of their personal data. Under GDPR, information that employers must provide includes:

  • the identity and contact details of the employer as a data controller;
  • the data protection officer’s (DPO) contact details (if the organisation has a DPO);
  • the purposes for which the data will be processed and the legal bases for processing, including, if relevant, the legitimate interests relied on;
  • the categories of personal data to be processed;
  • the recipients of the data;
  • any transfer of the data outside the European Economic Area (EEA);
  • the period of storage;
  • the rights of data subjects, including the right to access, rectify and require erasure of data, the ability to withdraw consent or to object to processing, and the right to lodge a complaint with the supervisory authority;
  • the consequences for the data subject of failing to provide data necessary to enter into a contract; and
  • the existence of any automated decision-making and profiling, and the consequences for the data subject.

Employers must provide the information at the point of data collection. Where an employer wishes to process existing data for a new purpose, it must inform employees or job applicants of that further processing.

5.     Data subject access requests – Employees have an existing right under the Data Protection Act 1998 to obtain from their employer (or former employer):

  • confirmation as to whether or not their personal data is being processed;
  • information on their data, including the purpose of processing, categories of data collected and the recipients of such data; and
  • a copy of the data being processed.

Under the GDPR, employers must provide the requested information within one month of the request (three months in the case of complex requests), and free of charge unless the request is manifestly unfounded or excessive. The GDPR places much more rigorous obligations on employers to ensure that there are systems in place to ensure that they comply with access rights, with particular emphasis placed on the clarity, transparency and accessibility of such systems.

6.     Accountability principle – One of the biggest changes under the GDPR is the new principle of accountability; the GDPR requires employers to demonstrate compliance with the data protection principles. This will mean enhanced obligations for employers, including a requirement to keep extensive internal records of data processing operations, which must be produced to the supervisory authority for inspection on request. Employers should create a data register to meet their record-keeping requirements. This should be an up-to-date written record containing information about all personal data processed by the organisation, including:

7.     Automated decision-making  – Employees have a right under the GDPR not to be subject to a decision made solely by automated processing where that decision significantly affects them. This includes decisions based on profiling (any form of automated processing to evaluate certain personal aspects of individuals, in particular to analyse or predict indicators such as their performance at work, health, personal preferences, reliability and behaviour). The GDPR requirements regarding automated decision-making mean that employers should incorporate human intervention into automated processes that significantly affect employees unless they are relying on an exception to the rule.

GDPR will become law on 25 May 2018 and that is a “hard deadline”. Organisations will need to be 100% compliant from day one.

Accountability needs to be entrenched in an organisation, requiring a cultural and organisational shift and for companies to take a proactive, methodical and answerable approach toward compliance.

For more information on how to comply with GDPR please speak to us at Solve.