IR35 tax legislation has been in force since 1999. The primary purpose of the IR35 legislation is to identify individuals whom are working on a self-employed or contractor arrangement who are in fact classified as a “disguised employee” working for the fee-payer/employer. Therefore the IR35 regulations identify instances of this nature whereby there has been an avoidance of Tax and National Insurance payments by fee-payers/employers and raises the question of employee employment rights. Since 1999, within the private sector it has been the responsibility of the self-employed worker/contractor to confirm the status of their worker arrangement if challenged by HMRC, whereas, within the public sector it has been the responsibility of the “fee-payer”.

From 6th April 2020, the legislation extends the responsibility to the fee-payer not only in the public sector but also to businesses of a certain size, within the private sector. This is a substantial shift of responsibility, which is likely to lead to an increase in awareness, exposure and multiple high profile case studies.

It will be the responsibility of the fee-payer to determine the status of the worker/contractor and to confirm this status in writing between both parties.

HMRC can instigate investigations into both fee-payers and self-employed/contractors at any time.
In addition, a claim could be raised in an employment tribunal for breach to statutory rights if a claimant was to infer they should be considered as a worker or employee. If a claimant was successful in being ruled to be an employee they could in turn raise claims in an Employment Tribunal for; unfair dismissal or breach of statutory rights including the right to the minimum wage, holiday, sickness and family leave and pay and discrimination.

There may be a fear from the fee-payer to suggest that employing all workers/contractors as employees may reduce the risk of failing IR35 Compliance. This is not the intention of the regulations. Employing an employee comes with Employer Tax and National Insurance payment responsibilities along with Employee Rights to all other Statutory and Company benefits provisions along with the accrual of Employment Rights; therefore the genuine contractor working arrangement could continue to be better suited for the fee-payer.

There are key indicators to assist with determining if the fee-payer and worker are likely to be operating within or outside of the IR35 regulations. Solve. can support you with determining these differences and can advise you on the requirements of the “fee-payer” in order to support with status determination. If you operate with service agreements for services provided, such as consultants, please do get in touch.

To find out more about IR35 Tax Regulations please speak to a member of the Solve. Team.

You may decide it is necessary to suspend an employee from work whilst a serious disciplinary matter is investigated. Suspension should not be used as a disciplinary sanction, if an employee is suspended, it is not an indication of guilt.

Most disciplinary procedures will not require suspension. An employee will usually be able to continue doing their normal role while the matter is investigated. Suspension should never be an automatic approach when dealing with a potential disciplinary matter.

The right to suspend an employee is normally set out in the contract of employment or employee handbook. Usually, a period of suspension will be on full pay, unless the contract of employment provides otherwise.

Why would you want to suspend an employee?
The reasons why you might suspend an employee could include:

• to highlight to the employee the seriousness of the matter and potential breakdown of trust;
• to immediately stop the employee carrying on the gross misconduct that is being alleged;
• to stop the employee interacting with other employees or clients/customers, which may otherwise cause a detrimental effect of the business;
• to enable you to properly investigate the potential disciplinary matter without any hindrance;

How long should the suspension last?
Any suspension should be for the shortest period of time whilst an investigation takes place, and you should regularly update your employee as to how long the suspension is likely to last.
If you suspend an employee without any reasonable grounds to do so, or you take an inordinate amount of time to carry out an investigation (without explanation), the employee may have a case for constructive dismissal.

To find out more about when to consider suspension and the correct process to follow, please speak to a member of the Solve. Team.

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

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Every business has different standards of what is deemed appropriate or inappropriate behaviour. While some forms of behaviour will always be inappropriate, it is important that everyone in the business understands where the line is drawn.

1. Bullying: undermining and humiliating another person. For example, off-colour jokes may appear to be simply bad taste, but it depends on the situation. They can be used to target an individual or group.
2. Harassment: unwanted conduct related to a relevant protected characteristic which violates an individual’s dignity. Such behaviour could manifest in subtle ways such as a creeping invasion of personal space.
3. Substance abuse can be identified by unusual changes in a person’s judgment, alertness, perception, performance and emotional state.
4. Violence can be easier to identify than other forms of inappropriate behaviour, and swift action is vital to deal with any incidents.
5. Disregard of company rules; reoccurring lateness, theft, disregard for company property etc.

By watching out for these 5 signs, Managers and businesses can be confident in their ability to offer staff a working environment free of inappropriate behaviour.

For guidance on inappropriate conduct at work, contact Solve on 0131 300 0433

Natwest has found itself at the forefront of the media recently when an employee went on an anti-vegan rant to one of their customers. The debacle made headlines when a Natwest customer phoned up for a loan with the bank and although the customer didn’t meet the loan requirements, the call was recorded and after investigation, it can be revealed that she spoken to in a manner which would not suggest great customer service.

After the staff member learned that the customer was vegan, he was recorded saying that “all vegans should be punched in the face” and told her that he felt vegans were forcing their beliefs on him. The customer stated that she felt his tone was “really unpleasant” and didn’t feel she should be punished for her lifestyle choices by a “big organisation.”

After listening to the recording, the bank decided to accept her loan request for £400 and pay out just under £200 in compensation.

Last year, Starbucks had to deal with public fallout after an employee mocked a customer with a disability. The customer had a lisp and the employee wrote his name on the cup as “SSSAM”.

Like the Natwest story, both of these incidents have a great impact on the Company’s branding. Poor practice, especially within visible customer-facing roles or roles susceptible to media coverages raises questions about how engaged employees are with the Company’s corporate ethos.

The impact for a Company’s brand is huge if their employees are not upholding the tone or image that is expected of the Company.

Often, improving employee engagement is incumbent on HR, as they are looked upon to improve how employees feel about the Company and how they engage with their work. A recent survey found that only just over four in 10 employees knew what their Company stands for.

If you would like help on employee engagement and retaining your company image through your employees, contact us at Solve.

Last month the government unveiled plans for new legislation that will mean that pregnant women and parents returning to work will receive greater protection from redundancy.

The government announced it would begin consulting on extending legal protection against redundancy for pregnant women for six months after they return to work.

The 10-week consultation recommends maternity and parental leave (MAPLE) regulations be extended to cover a six-month period after a new mother returns to work. It could potentially also be applied to others, including men, who return from adoption leave or shared parental leave.

Under current regulations, if redundancies are being made, employers have an obligation to offer those on maternity or shared parental leave a “suitable alternative vacancy” where one is available, giving these employees priority over others who are also at risk of redundancy. However, this provision ends when an individual returns to work.

The consultation cited research commissioned by the Department for Business, Energy and Industrial Strategy (BEIS) that found one in nine (11 per cent) women said they had been fired or made redundant when they returned to work after having a child, or were treated so badly they felt forced out of their job.

The BEIS study also estimated 54,000 women a year may lose their jobs due to pregnancy or maternity.
Separate research published last year found fewer than one in five women feel confident returning to work after maternity leave. The survey also found more than a third (37 per cent) felt so isolated they considered resigning.

The government also committed to exploring evidence for changing employment tribunal time limits for claims relating to discrimination, harassment and victimisation, “including on the grounds of pregnancy and maternity”.

The government said tribunals could already allow the three-month time limit to be extended in discrimination cases if it is considered this “just and equitable” given the circumstances of the case. It hoped the consultation would build on previous work to gather data on the success rate of “out of time” tribunal claims for pregnancy and maternity discrimination.

The consultation on extending redundancy protection for women and new parents will end on 5 April.

Family-friendly regulations and policies are designed help foster inclusive and productive work cultures. If you would like review your existing family friendly policies and procedures speak to us at Solve.