GOOD PRACTICE IN MANAGING EMPLOYMENT RELATIONS GUIDANCE LEAFLET.

Understand the impact of employment law at the start of the employment relationship

Internal and external factors that impact on the employment relationship

Internal:
• Performance, pay and reward: employers should set clear and transparent targets in order to make it easier for employees to know what is expected of them. If these targets are followed employees can be rewarded and this should improve the relationship between employer and employee.
• Management style: there are two types of manager: autocratic and democratic. Autocratic managers make decisions without involving the staff. This can be a good idea in some circumstances (for example the need to make a quick decision to avoid catastrophe or missing a deadline or target) but if this style is used all of the time it can be detrimental to staff motivation, commitment and well-being. Democratic managers involve staff with decision making as much as possible which means everything is agreed on by the majority of staff. This can lead to increased levels of motivation, commitment and well-being which subsequently could increase the profitability of the business.
External:
• Economic factors: slow economic growth or a downturn can make employees just thankful they have a job. This can put pressure on them because employers may decide to increase workload by making individuals do more work in the same time. With the fear of redundancy looming and as the company has less capital employees may feel they have to work harder in order to maintain or enhance their current level of income.
• Legislative factors: legislation such as the “Equality Act 2010” deal with discrimination and various other issues, both nationally and internationally; this helps protect employees from behaviour which previously may have been a source of conflict. There is also the Agency Workers Directive which affords agency workers some protections after 12 weeks like the right to national minimum wage, rest breaks and paid annual leave.

The different types of employment status and why it is important to determine an individual’s employment status

Worker:
• Some examples of different types of workers are agency, short-term, casual and freelancers. Different types of workers have different rules. Someone is generally classed as a “worker” if they have a contract of employment or any other contract to do or perform work or services themselves for a reward which can be money, benefit or the promise of future work. Workers don’t have the right to send sub-contractors in to do the work for them and they can’t do the work as if they are a limited company and the employer is a customer. There are many reasons why someone may be employed as a worker. This can range from covering for leave e.g. maternity, paternity and adoption, employed as extra staff over a busy period like Christmas or employed to work on an event or project which is time-lined. It is important to determine this employment status from others because workers are afforded only some of the core rights/protections employees are. Some of these protections/rights are: the national minimum wage, unlawful deductions from wages, the 48 hour working week and the opt-out clause under the working time directive and also protection for whistle blowing. They are not entitled to the extra rights employees have like protection from unfair dismissal, flexible working and redundancy pay.
Permanent employee:
• This is the most common employment status and usually applies to most of the people in a workforce. An employee is a person who works under a contract of employment and this can be either a permanent/full-time contract or a part-time contract. They can’t send anyone else to do their work and they are required to work regularly with a minimum number of hours expected. For example: 44 hours a week which will be 8am - 5pm Monday to Friday and 8am - 12pm on Saturdays. They are subject to the company’s disciplinary procedures.

It is important to determine this employment status because “employees” not only have all of the rights workers have but have extra employment rights and responsibilities which don’t apply to workers that are not employees. These extra rights, for example, include: protection against unfair dismissal, maternity and paternity pay and leave, the right to ask for flexible working hours, statutory sick pay, minimum notice periods (in case of an employer dismissing you), redundancy pay and some others. Permanent/f ull time and part-time employees have basically the same rights. The claim to being an employee could come even after the contact has ceased, in order to assert employment rights.
Self-employed:
• Self-employed people are considered their own boss as they are not actually employed by an organisation, they are in business of their own right and don’t have a contract of employment. They usually take on work or perform services of their own accord and get to decide how much sick or holiday time they give themselves. They are responsible for paying their own income tax and national insurance contributions and they usually provide their own equipment/tools to do the work/service. You will find self-employed people usually submit invoices, are VAT registered and can be a limited company. It is important to distinguish this employment status from others because if you were to offer work to this person, for example painting a house even though this person claims to be self-employed, HMRC may take a different view and you may have to pay tax and national insurance to HMRC for that person even if you have paid them on completion of the job without deducting it. Self-employed people aren’t generally covered by employment legislation. They lose the right to unfair dismissal, national minimum wage and others. They still have the right to a safe working environment and in some instances protection if they are discriminated against.

Understanding the main individual rights that the employee has during the employment relationship

The importance of work life balance within the employment relationship and how it can be influenced by legislation

It is important employers recognise that helping staff to strike a healthier balance between their work life and personal life can improve a number of areas. An example of legislation that influences work life balance is the working time regulations (WTR) 1998. These regulations cover any time an employee is working or carrying out an employer’s activities or duties. The idea of this legislation is to make sure businesses are giving their employees adequate rest breaks. The following benefits of rest breaks are important to the work life balance:
• Increased motivation: employees that are restless or lethargic tend to lack motivation so adequate resting should give them enough time to re-charge and hopefully keep them motivated.
• Enhanced performance: well rested employees will have more energy and will find it easier to make an effort and put forward their ideas.
• Enhanced customer and consumer value: employees that are well rested will be more likely to respond positively and have a better attitude towards the customer or consumer thus giving a better service.
There are more protections WTR offer employees. The average working week is 48 hours over 17 weeks. In Britain there is an opt-out clause which allows businesses to ask their employees to opt out of the average 48 hour week. Employers are not allowed to force the employee to do this and employees cannot be fairly dismissed for refusing to sign one. Workers are entitled to 28 days paid holiday per annum. This can include 8 public holidays but there is no statutory requirement for this it is merely a contractual decision between employer and employee. Some more rights are: a limit of an average 8 hours work in 24 hours for night workers, right to 11 hours rest a day, right to a day off each week and a right to an in-work rest break if working 6 or more hours.

A summary of the legal support that may be given to employees as a family member

Flexible working:
• Must have had 26 weeks continuous service
• Can only have 1 request every 12 months
• Must be put in writing
• Employer has 28 days to respond
• Right to appeal decision
Unpaid emergency leave:
• Right to reasonable time off for emergencies with people the employee cares for e.g. Family member.
Parental leave:
• Both parents have the possible right to leave if child is under 5 (under 18 if disabled).
• Employees must have one year continuous service.
• Maximum 18 weeks leave for each child up until 5th birthday (18th if disabled).
• Parental leave is unpaid (unless employer pays occupational pay).
Statutory maternity leave and pay:
• Entitled to 52 weeks (26 ordinary and 26 additional weeks leave).
• Must be employed by same employer continuously for 26 weeks by the 15th week before due date.
• Women are entitled to 90% of average weekly earnings (before tax) in the first 6 weeks.
• Right to keep receiving bonuses
• Then for the next 33 weeks £136.78 (statutory) or 90% of average weekly earnings (whichever is lowest).
• Return to same job (after ordinary leave)
• Women not entitled to statutory maternity pay can apply for statutory maternity allowance.
Statutory Paternity Leave and pay includes adoption:
• Can get either 1 or 2 weeks ordinary leave which must be taken in one go.
• Can get between 2 and 26 weeks additional leave (depending on how much unused maternity or adoption leave your partner has)
• Ordinary and Additional pay is £136.78 (statutory) or 90% of average weekly earnings (whichever is lowest).
• To qualify both partners have to be employed continuously for 26 weeks by the 15th week before the due date or week one of them is matched with a child for adoption.
Adoption Leave and Pay:
• Must be employed for 26 weeks by the week they are matched with a child for adoption.
• Statutory adoption leave is 52 weeks (26 ordinary, 26 additional weeks leave).
• One partner is allowed to take the leave; the co-adopter can get additional paternity leave instead (26 weeks).
• Statutory weekly pay for ordinary and additional is £136.78 or 90% of average weekly earnings (whichever is lowest)
Dependents Leave:
• Employees have the right to apply for a change in working pattern to support dependants.
• Employers must follow statutory process and procedure when reviewing an application.
• Employers don’t have to accept the request if it makes a negative impact on the business, their customers or other employees.

The reasons for treating employees fairly in relation to pay

Complying with legislation:
• Employers have to comply with the law on equal pay. The legislation which governs this is the Equal Pay Act 1970 which has been consolidated into the Equality Act 2010. Both men and women must be treated fairly in relation to equal pay for doing the same job or jobs that are similar (like work). If a man and a woman are sitting in an office next to each other each on a computer doing exactly the same job they must be paid equally unless one is paid more due to being employed with a higher level of experience. The same also applies for job roles that are different but have equal value to the employer for example cooks and refuse collectors who work for a local council.
Enhancing employer brand/reputation:
• If word spreads that an employer may not be treating their employees fairly, for example: not paying attention to health and safety regulations, this can have an effect on staff retention and can be detrimental to staff motivation with the end result being loss of productivity and profits. In certain circumstances it may lead to negative press which could greatly damage the reputation of the business making it harder to recruit new employees.

Summary of the main points of discrimination legislation

Equality Act 2010:
• Allows more equality duties to be included in tenders for public sector contracts
• Outlaws secrecy clauses in contracts
• Updates existing anti-discrimination law
• Greater scope for positive action
• 9 Protected characteristics
1. Age,
2. Disability,
3. Gender reassignment,
4. marriage and civil partnership,
5. pregnancy and maternity,
6. race,
7. religion or belief,
8. sex,
9. Sexual orientation.
Direct and indirect discrimination:
• When an employee is blatantly treated less favourably than another employee it is direct discrimination.
• When there is an unnecessary requirement put in place that treats an employee in a protected characteristic less favourably than other employees it is indirect discrimination.
Harassment:
• Unwanted attention with regards to a protected characteristic.
• Consciously or sub-consciously.
Victimisation:
• Discriminating against an employee who has made or supported a complaint regarding one of the 9 protected characteristics.

The good practice that underpins organisational policies and can contribute to the psychological contract

The concept of the psychological contract is that it does not form part of the contract of employment and is not written on a piece of paper. It is the perceptions or understandings of the employer and employee of what their mutual obligations (expectations) are of each other. The contract is based on the employee’s sense of fairness and trust and that the employer is keeping to that deal. A positive psychological contract promotes increased employee commitment, satisfaction and will have a positive impact on business performance where as a negative one will do the opposite. When organisational policies are implemented and adhered to this has a huge impact on the psychological contract. Some examples of good practice underpinning organisational policies are:
• Allowing employees to voice their opinions and get involved when making or amending policy.
• Allowing employees to provide feedback on policy.
• Evaluation processes which allow improvements to be made to policy.
• Promoting openness, transparency and consistency.
• Equality and diversity, respecting everyone’s rights.
• Allowing employees a grievance process to deal with concerns fairly.
• Policy supported by senior management.
• Policies supported, implemented and followed/adhered to by key stakeholders like line managers.
• Reward, recognition and benefits policy.
All of the above examples contribute to the psychological contract by giving the employee a sense that they are being treated fairly and that their employer cares about their wellbeing.

Understand the issues to be addressed at the termination of the employment relationship

The differences between fair and unfair dismissals

An employer has to act fairly and reasonably when dismissing an employee and would need to prove the reasons given for this are justified. Although employment tribunals only need to have regard to this, employers must follow the ACAS Code of Practice even though it does not have the force of law, otherwise they may have difficulty convincing a tribunal they acted fairly. To act fairly employers must investigate the reason/s properly before making a final decision. For example: A capability issue could be due to a lack of training. In this case if the employer provided training or time off for training the issue could be resolved without the need for dismissal. If at any time the employer fails to act fairly (not following ACAS Code of Practice) this will be classed as an unfair dismissal providing the employee has accrued the relevant rights (2 years for unfair dismissal), or in cases of discrimination the right is automatic at the start of employment. Unfair dismissals could result in a claim for compensation in an employment tribunal.
• Fair dismissal: Some reasons and examples for potentially fair dismissal are:
1. Misconduct (including serious and gross misconduct) – stealing or breaking the law.
2. Redundancy – work has ceased.
3. Capability – incapable of doing job to required standard.
4. Statutory restriction – employee lost driving license.
5. Some other substantial reason – temporary maternity cover ended.
• Unfair dismissal: Some reasons and examples for potentially un-fair dismissal are:
1. Not following policy/process – Dismissed because of being pregnant
2. Discrimination – Dismissed for being black
3. Failure to conduct a full investigation – Dismissed on the spot
4. Failing to follow the ACAS Code of Practice – Not allowed a witness
5. No right to appeal – Denied the right to appeal a decision

The importance of exit interviews

An exit interview takes place usually when the contract of employment has come to an end because the employee has decided to leave. This is useful to employers because it enables them a chance to find out why the employee has decided to leave. It is also useful to employees. Some of the benefits of these include:
• Employers:
1. Feedback to improve practices. This allows the employer to find out areas of concern which need to be addressed
2. Leaving with good relations. This enhances the employers brand/image and helps with future staff retention.
3. Return of employee in the future. If the employee is likely to return in the future this hints to employers that policies and procedures are working and fair.
4. Inform future recruitment decisions. This helps with making recruitment decisions in the future.
5. Promote employee engagement. Provides the employer with feedback on needs for individual development.
• Employees:
1. Feedback. Employer can provide the employee with feedback for their own development.
2. Leaving with good relations. This maintains good relations for a possible return in the future and allows the employee to enhance their professional network.
3. Conflict. It can diffuse any past or present conflicts between the employer and employee.
4. Career. Transfers knowledge for employee’s future career development.

A summary of the key stages to be followed when managing redundancies

Redundancy consultation:
• Process to determine the financial impact on employees.
• Time off to look for a job.
• Enable representatives (if no trade union).
• Communication of a fair and transparent process should be clear.
• Selection process/selection criteria/numbers.
• Should be meaningful, conducted at individual level.
• Staff should be involved in finding solutions
• More than 20 individuals to be made redundant then minimum 30 days consultation.
• More than 100 individuals to be made redundant then minimum 45 days consultation.
• Both situations must be reported to the Dept. for Business Innovation and Skills (BIS).
Compulsory redundancy alternatives:
• Voluntary.
• Staff re-deployment.
• Reduction of hours.
• Career breaks or sabbaticals.
• Recruitment freezes.
• Job sharing.
Redundancy pay:
• 0.5 weeks pay per full year of service for employees under 22.
• 1 weeks pay per full year of service for employees between 22 and 41 years old.
• 1.5 weeks pay per full year of service for employees over 41.
• Weeks pay is capped at £450 and up to a maximum of 20 full years of service.