XpertHR - Employment Intelligence

Countdown to Budget 2010: a week of mixed news for the Chancellor

2010-03-19T13:34:57Z

With Budget 2010 just a few days away, there has been both good and bad news for the Chancellor this week.

On Wednesday, the labour market figures revealed a significant drop in unemployment and the claimant count, leading some experts to comment that unemployment may now have peaked (on the Independent website). The Centre for Economic and Social exclusion has put all the figures into easy-to-read charts on their website.

]]> But on the same day, the UK government was among the countries criticised by the European Commission (BBC website) for the "uncertainty" surrounding its plans to cut the deficit, which EU rules say should be below 3% of GDP (the UK's is forecast to hit 12.6% this year).

Thursday brought the news that the public finances are looking in slightly better shape (on the BBC website) than the government predicted in the Pre-Budget Report. City bank Goldman Sachs suggests that public sector borrowing for this financial year may come in at least £10 billion below the government's Pre-Budget Report forecast of £178 billion.

Not long to go until Budget day itself - Wednesday 24 March - when we'll be providing pre- and post-speech analysis of the Chancellor's announcements here on Employment Intelligence.

During the Budget speech itself (due to start at 12:30pm) I will be joining Personnel Today's live blogging team together with HR professionals and industry experts to digest what the Budget means for the HR community and employers in the UK.

If you are an HR manager, employment expert or union representative, why don't you sign up and take part? Bookmark this page on the Personnel Today website and send your contact details, including your company and job profile, to news editor Louisa Peacock, at louisa.peacock@rbi.co.uk.

Employment tribunal decisions making the headlines: 06.03.10 to 19.03.10

2010-03-19T08:00:00Z

A round up of links to news items on recent employment tribunal rulings, including: an unsuccessful age discrimination claim by a TV journalist; the first decision on trade union blacklisting; and an award for a chip shop worker who was dismissed for giving away chips.

]]> You can now keep track of interesting employment tribunal decisions that you may not have heard about in the press in XpertHR's new employment tribunal case reporting service.

If you know about or have been involved in a recent employment tribunal decision, please let us know by commenting below.

Employment tribunal awards compensation to train driver (on the Kester Cunningham John website) A former train driver who was forced to leave his job without a redundancy payment from his employer has been awarded compensation.

Pregnant worker forced out of job wins case (on the This Is Local London website) An admin worker forced out of her job when she became pregnant has won a payout at an employment tribunal. She told the tribunal that, when she told her bosses that she was pregnant, she was treated so unsympathetically that she was forced to resign 11 weeks later.

Housekeeper underpaid by £27,000 (on the Get Reading website) An employment tribunal has ruled that a housekeeper who was sometimes required to work 24 hours a day was underpaid by more than £27,000.

Journalist loses unfair dismissal claim (on the Evening Star website) A TV journalist who said she lost her job because at ITV Anglia bosses wanted younger faces to present news reports has lost her age discrimination claim.

Balfour Beatty wins blacklist tribunal (on the Northern Voices website) An employment tribunal has found in favour of the employer in the first decision on trade union blacklisting. Although the employer did not dispute that it had supplied information to a secret blacklist database, the claimant was not an employee and so was not protected.

Chip shop worker wins £2,500 (on the Cambridge News website) An assistant manager in a chip shop has won a claim for unfair dismissal after she was sacked for giving chips away.

Worker resigns in protest against being laid off (on the Kidderminster Shuttle website) A worker who resigned in protest against being laid off instead of offered redundancy has lost her compensation claim.

Previous employment tribunal decisions reported on XpertHR [subscription required]
Consultation on collective redundancies
Pregnancy and maternity leave discrimination
Unfair dismissal in selection for redundancy
Age discrimination in redundancy
Disability discrimination in the police

Employment tribunal round ups coming soon
Disability discrimination: duty to make reasonable adjustments

Photo: Jem

Pay awards stand at 1% in February 2010, but outlook is uncertain

2010-03-19T07:15:00Z

With the economy making a faltering return to growth, whole-economy pay awards also appear to be showing tentative signs of recovery, according to latest benchmarking research from IRS for XpertHR. The headline pay award stood at 1% over the three months to 28 February 2010. But closer analysis reveals a more complex picture: pay freezes remain commonplace; and continuing economic and political uncertainty at a busy time for pay setting means that the outlook for settlements is unclear.

]]>

The 1% median pay award over the three months to 28 February 2010 is unchanged from the figure for the previous rolling quarter, which has been revised up by one percentage point, from nil to 1% as details of more settlements have been collected by IRS researchers.

More than one-third of pay awards resulted in a pay freeze.

The interquartile range for pay awards stands between nil and 2%.

More than two-thirds of pay deals are worth less than a year ago.

Looking ahead, IRS pay specialist Rachel Sharp comments that prospects for pay awards over the remainder of the year are anything but clear. Sharp says:

There are both upward and downward pressures on pay, and how the battle between them plays out depends on many factors that are still subject to ongoing uncertainty. Not least of these is the fear that economic growth is weak and the UK may still see a double-dip recession.

If your organisation recently carried out its annual pay review, and if it has now been settled, please get in touch so that we can add your organisation's pay award to the IRS database.

Sickness absence: get familiar with the new fit note

2010-03-18T09:19:00Z

Whether you are an employer, employee or doctor, now is a good time to get familiar with the layout of the new fit note, which replaces the traditional sick note from 6 April 2010. A new entry on the statement of fitness for work [subscription required] in the XpertHR policies and documents section brings together the Government's sample version, official guidance for employers and doctors, and an overview of the law relating to the new fit note.

]]> Subscribers to XpertHR should look out for updates to the following model documents in the next few weeks [subscription required]:

Contract clause on sickness absence reporting
Self-certificate form for sickness absence
Letter inviting an employee to attend a meeting following a period of sickness absence
Long-term sickness absence policy
Short-term sickness absence policy
Policy setting out structure for return-to-work interview after short-term sickness absence
Form for return-to-work interview after sickness

In the meantime, we are covering the new fit note system in our topic of the week articles during March. We have already provided an overview and guidance on fit notes and dealing with sickness absence [subscription required].

Photo: Andres Rueda

UK unemployment rate falls to 7.8% over three months to January 2010

2010-03-17T09:30:00Z

The headline unemployment rate has fallen back to 7.8% (PDF format, 324.2K) (external website), according to latest data from the Office for National Statistics (ONS). This is its first fall in more than 18 months.

]]> Key findings of today's unemployment data release include the following:

The headline unemployment rate (on the ILO definition) stood at 7.8% over the period November 2009 to January 2010. The ONS reports that this figure is down 0.1 percentage point when compared with the rate seen in the previous rolling three-month period, which ran at 7.9%. The ONS comments: "This was the first quarterly fall in the unemployment rate since the three months to May 2008."
The ILO unemployment level was 2.45 million over the period November 2009 to January 2010, which the ONS reports is down 33,000 on the previous quarter. According to the ONS: "There has not been a larger quarterly fall in the number of unemployed people since the three months to July 2007. However, the number of people unemployed for more than 12 months increased by 61,000 over the quarter to reach 687,000, the highest figure since the three months to August 1997."

However, the headline figures mask more complex developments. For example, as personneltoday.com reports, data on employment levels - also released today - show that employment levels have actually fallen. Personneltoday.com says "there [are now] 54,000 fewer people in work, with full-time jobs particularly hard hit". It says that CIPD chief economist John Philpott ascribes this "apparent paradox" to "a very sharp rise of 149,000 in the number of economically inactive people, with the number of students surging by 98,000. Jobless young people are thus turning to study in their thousands to avoid the dole."

Over recent weeks, it has become a common theme among economic commentators to observe that the recession has had a less severe impact on unemployment than might have been expected.

Looking ahead, some commentators believe that while further rises in unemployment are inevitable, they may not be severe. Earlier this month, the British Chambers of Commerce (BCC) downgraded its forecasts for peak unemployment (external website), which it now expects to come in at 2.65 million (or 8.4% of the workforce) in the third quarter of 2010. This is down slightly from its previous forecast (2.7 million).

However, the Bank of England has issued a more sombre overview of trends in unemployment (PDF format, 523K) (external website), and what we might expect to happen next. It argues that while "a number of factors, including greater flexibility in real wages, may have helped to mitigate the fall in employment to date [...] there is considerable uncertainty about how the labour market will evolve."

According to the Bank of England, "the labour market is continuing to adjust." In other words, the path taken by the labour market during the recession may not necessarily be the one it takes now faltering recovery is underway. Things could go either way:

Demand may rebound more strongly than businesses have expected. [...] But there remains a risk of further falls in employment if, for example, the recovery in demand proves more sluggish than businesses have expected.

The willingness (or otherwise) of UK workers to accept ongoing pay restraint will also exert a significant influence on unemployment. It says:

The outlook for employment will also depend on developments in real take-home pay. Employees may have become more confident about the employment outlook and may be unwilling to accept a further squeeze in real wage growth. That could lead them to push for higher pay settlements this year. But if companies cannot afford the increase, then they may shed labour in order to contain labour costs.

Today's news that the headline unemployment rate has fallen for the first time in more than 18 mohths is of course extremely welcome. But it would seem that the UK labour market is by no means out of the woods yet.

Reporting on health and safety - myths and misrepresentations

2010-03-16T16:17:05Z

An interesting story in the Independent this week highlights the negative reporting in the British media of health and safety issues. The article, by the Chief Executive of the Institution of Occupational Safety and Health Rob Strange, singles out Richard Littlejohn and the Daily Mail as purveyors of myths and misrepresentations about health and safety law (possibly the source for parts of David Cameron's speech (on the BBC website) on the subject last December).

]]> The article points out that the UK has one of the best safety records in Europe, and that fewer workplace accidents, healthier workforces and better attendance save employers huge amounts of money (if protecting the lives of workers wasn't enough of a reason to take health and safety seriously).

Subscribers to XpertHR can get comprehensive, myth-free information about their duties under health and safety law in the XpertHR employment law manual. The XpertHR FAQs section also contains the answers to numerous employers' questions on health and safety (no subscription required).

Single mistake (like crashing a nuclear submarine) can justify dismissal

2010-03-16T15:02:28Z

The recent court martial (on the Daily Telegraph website) of the commander of a British nuclear submarine who crashed his vessel into a large rock provides a useful reminder that there are occasions when a single mistake can justify dismissal.

]]> Commander Steve Drysdale is being disciplined for an incident in May 2008 where the nuclear submarine HMS Superb ran aground in the Red Sea after it struck a rock. Commander Drysdale and two of his officers have admitted that their mistake in misreading the depth of the obstruction as 732 metres when it was at 132 metres had caused the accident.

The classic case in this area is the old (but still good) case of Taylor v Alidair Ltd [1978] IRLR 82 CA [subscription required], where a pilot was dismissed after a badly executed landing (see also the subsequent decision in Inner London Education Authority v Lloyd [1981] IRLR 394 CA [subscription required], which explained some of the limits of the principles set out in Taylor v Alidair Ltd).

As long as a fair procedure is followed, a decision to summarily dismiss an employee for a single catastrophic mistake can be justified where:

- the inadequacy of an employee's performance is so extreme that no amount of training or time for improvement could possibly make a difference; or

- the consequences for an employer are so great that it cannot be expected to continue the employment relationship.

Photo:BlatantNews.com

Draft EHRC Code of Practice: Don't Panic!

2010-03-16T08:47:00Z

The Equality and Human Rights Commission (EHRC) has caused a bit of a stir with its draft Employment Statutory Code of Practice on the Equality Bill (external link), specifically in relation to discrimination on the ground of religion or belief.

]]> Ever since the Employment Appeal Tribunal's (EAT) decision, in 2009, that a belief in climate change was capable of being protected under discrimination law (external website), there's been much discussion as to what other beliefs might be covered.

It's impractical for the legislation to list every belief that would or wouldn't be protected - there are an infinite number of philosophical beliefs - and so the Government understandably left it to the courts to decide.

But the word "belief" is notoriously difficult to define even outside the legal sphere, so it's no wonder that there's a lot more work for tribunals to do to determine exactly what philosophical beliefs are and aren't capable of being protected under discrimination law. It's also no wonder that employers are a bit confused.

However, amid all the talk of scientology and political philosophies being potentially protected, employers need to remember that the EHRC draft Code - which doesn't actually say anything new as regards religion or belief discrimination - is not a statement of the law, as indeed its introduction explicitly states.

The Code will need to be taken into account by tribunals but that's as far as it goes, and the law will continue to be determined by the legislation as interpreted by appellate courts - and note that the Equality Bill (external website), as currently drafted, doesn't change the existing statutory definitions of "religion" or "belief".

Employers also need to bear in mind that just because a belief is capable of being protected, that is just the first step for a claimant. The EAT decision mentioned above held that a belief in climate change could be protected, but Mr Nicholson will now need to convince a tribunal that his belief was the reason for his alleged detriment.

In other words, in order to succeed, an employee claiming they've been discriminated against will need to prove that their alleged detriment was due to their particular philosophical belief; and they will always find this difficult if the employer has treated the employee fairly and can back that up with credible evidence.

Finally, employers can successfully defend claims of indirect discrimination if they are able to objectively justify their actions. This is crucial, as many of the theoretical examples being bandied around at the moment - such as vegans complaining about a company's leather chairs - would fall into the category of indirect discrimination, and might well be capable of being justified.

While the debate over the EHRC draft Code rages on, why not refresh yourself on the topic with XpertHR's FAQ section on religion or belief discrimination, which includes answers to the following:

Can an employer be liable for harassment of an employee by other employees because of his or her religion or belief?

Are companies required to provide a prayer room for staff?

Should employees who practise faiths other than Christianity be given additional annual leave to enable them to celebrate religious festivals?

Budget 2010: Little room for manoeuvre

2010-03-15T08:30:00Z

With less than ten days to go until the 2010 Budget, Chancellor Alistair Darling confirmed to Sky News on Sunday that there would be no comprehensive spending review until after the 2010 general election (external website).

]]> That implies the Chancellor will not be announcing the details of any spending cuts in his Budget. Most commentators think it unlikely that any significant new tax-raising measures will be announced either, leading accountancy firm BDO to describe the forthcoming Budget as "the phoney budget" (on their website).

Adding to the list of things NOT expected in the 2010 Budget, the KPMG's Chief Economist Andrew Smith writes that there won't be scope for any pre-election giveaways either, as the £180 billion hole in the public finances means that "the cupboard is bare" (on the KMPG website).

However, the Observer reported yesterday that the Chancellor will claim that government action to protect jobs has saved the UK economy around £12 billion (on the Guardian website), suggesting that there may still be a little to spend.

"Last night Treasury sources insisted that most of the windfall savings from lower-than-expected unemployment would be used to cut the deficit, rather than for pre-election giveaways," the paper says.

But writing in the Guardian last week (external website), Larry Elliot's tip was that despite the theme of fiscal rectitude, "there are also likely to be job creation measures, help for small businesses and money for pensioners."

Pay awards in 2010: Will UK workers continue to accept pay restraint?

2010-03-15T07:15:00Z

The willingness of UK workers to accept severe pay restraint - in many cases involving pay freezes - has helped many employers minimise job cuts and weather the worst of the 2008/2009 recession. However, with tentative economic recovery now underway and inflation soaring, it remains to be seen if UK workers and trade unions will tolerate a second successive year of pay restraint.

]]> Latest pay data from IRS for XpertHR show that pay freezes remain widespread in 2010. The headline pay award has collapsed back to its all-time low of nil (subscription required) over the three months to 31 January 2010, according to latest IRS data.

Pay awards first plunged to nil over the three month periods ending in July and August 2010. However, retail prices index (RPI) inflation was firmly parked in negative territory at that time, meaning that a pay freeze could in some ways be argued to represent a pay increase.

In contrast, the current return of pay freezes comes as RPI is rising rapidly. RPI currently stands at 3.7%, meaning that the median pay award is effectively 3.7 percentage points below inflation. Although RPI is expected to fall back later this year, the latest round-up of inflation forecasts compiled by IRS (subscription required) suggests this fall will be shallow. IRS says that "RPI will remain comfortably above 3% over 2010 as a whole."

But weak economic recovery could well result in 2010 pay awards remaining stuck below inflation.

The February 2010 Inflation Report (external website) from the Bank of England highlighted the critical role that workers' willingness to accept pay restraint will play in shoring up employment levels, which are in turn essential for sustained economic recovery. It said:

The outlook for employment will also depend on whether employees attempt to resist further restraint in real take-home pay.

Attention will therefore be keenly focused on workers' and unions' expectations as the busiest part of the 2010 pay bargaining calendar unfolds. And there are signs that pay restraint may not be so readily accepted this year:

TUC deputy general secretary Frances O'Grady has asserted that unions are willing to push for higher pay increases in 2010 at her speech to the TUC pay bargaining conference.
Last week saw an estimated 270,000 civil servants striking in protest at planned cuts to redundancy pay - an action described by the Telegraph as "the biggest outbreak of industrial unrest in the service since 1987" (external website).
British Airways cabin crews are to stage seven days of strikes over the coming weeks (external website) in protest at protracted negotations regarding pay, allowances and proposed redundancies.

David Cameron, meanwhile, has promised a hardline stance on the unions if the Conservatives are returned to power in the 2010 general election.

Pay awards consequently look set to represent one of the most crucial employment issues for 2010, with widespread implications for workers and employers, and for the strength of economic recovery.

Video: sickness absence and annual leave

2010-03-12T21:21:02Z

There's a new outlook video first published today on the main XpertHR site, where Jo Stubbs and I discuss recent developments in the law on statutory minimum annual leave and sickness absence. Here it is.

You can see all previous videos in the outlook series on the video home page.

Right to request time off for study or training: is your policy in place yet?

2010-03-12T13:48:04Z

With less than a month to go until the introduction of the right for employees to request time off to undertake for study or training, time is running out to get your procedure in place and to communicate it to your workforce.

]]> To help employers prepare for the new laws on time off for training, which are coming into force on 6 April 2010, XpertHR has now published a model policy on the right [subscription required], as well as a letter that can be circulated to employees explaining how the procedure to request time off works [subscription required].

We are also in the process of preparing more model letters and forms to cover the various stages of the right to request time off for training procedure. Visit our new policies and documents section to see which ones are already available and the "Coming soon" area of the site to see what's still to come.

While we hope to cover every eventuality in the model documents, we are always keen to hear if employers come across practical issues that require, for example, an additional model letter that hasn't occurred to us. To make a suggestion, simply comment below.

Learning gets social for UK employers - or does it?

2010-03-12T09:55:51Z

Here are a couple of interesting links regarding workplace learning. A post at Interactyx looks at recent research by Bersin and Associates which shows the UK lagging behind the US in the use of elearning technologies.

But reliance on instructor-led classroom training by UK employers, as revealed by the survey, comes as no surprise - it is tried and tested. And many UK employers will have stories to tell of the mixed success of elearning programmes.

However, the cost of training is becoming more of an issue which makes the use of social media technologies in learning a lot more interesting.

For example, if you can deliver training in an engaging, shared way in a safe environment why pay to have employees attend off site training? And if you have a highly dispersed workforce then the cost of offsite training rises rapidly.

Elearning is not new but it is changing and these changes present new opportunities to engage employees in many different - and less formal - ways.

I thought this was a useful summary of how elearning has changed - taken from the Social Learning Handbook.

E-Learning 1.0 was all about delivering content, primarily in the form of online courses, produced by experts - teachers or subject matter experts. E-Learning 2.0 or Social Learning is all about individuals (co-)creating content in a variety of formats and sharing information and knowledge using tools like blogs, wikis, social bookmarking and social networks both within an educational or training context to support a new collaborative approach to learning as well as to support their own personal and group learning and working activities.

And here are a couple more resources:

The new BBC learning design toolkit looks very interesting and is free for employers to dip in to. It outlines the BBC's approach to training based on deep employee research.

This list of the top 100 tools for learning - made up of contributions from 278 learning professionals around the world - lifts the lid on how many different types of tools are now being used in the delivery of learning. Here is the presentation:

Top 100 Tools for Learning 2009

View more presentations from Jane Hart.

XperHR is carrying out a survey of how employers train line managers. Whether you are using social learning or not, please let us know your thoughts - you will receive a free copy of the results.

2010 public sector pay freeze not as simple as it sounds

2010-03-11T15:15:33Z

Despite the public sector pay freezes announced yesterday (see the coverage in the Guardian, Telegraph and Financial Times, plus the reactions from the First Division Association and the British Medical Association, all on external websites) many public sector employees will still be getting a pay rise in 2010.

]]> These include the armed forces (see the announcement on the Ministry of Defence website), some prison officers (1% from April 2010 to maximum salaries, senior prison officers get 1.5%) and various medical groups such as registrar grades, foundation house officers and speciality doctors who all get 1% from April 2010.

In his speech yesterday, the Prime Minister said that GPs would have their pay frozen, but in fact some of them (the minority of GPs that are employed rather than self-employed) will be getting a 1% rise.

So when we put those groups together with those we already know will get pay rises in 2010 in the stages of long-term deals - most NHS workers, schoolteachers, police officers and various government departments - then somewhere between a third and a half of the UK's six million public sector workers are going to be getting a basic pay rise this year.

Even some of those who are having their pay frozen, such as senior civil servants, will still get non-consolidated performance-related pay rises.

We'll be covering the various public sector review body reports in depth shortly on XpertHR. In the meantime, our 2009 round-up summarises the state of play (subscription required).

Research request: regional pay

2010-03-11T11:00:00Z

Regional pay can help employers to meet differing recruitment and retention needs in local labour markets. There are, however, significant issues that employers need to resolve when implementing successful regional pay arrangements: how much, where and why.

Taking part in this IRS survey will provide you with the very latest information on regional pay arrangements.

This survey is a named practice survey to allow participants to benchmark their policies against those of other organisations. It closes on 26 March 2010. Please contact Adam Geldman on 01780 481 195 if you have any questions regarding this research.

]]> 2009 Annual Survey of Hours and Earnings revealed:

Wales had the lowest median hourly pay (excluding overtime) with £9.91 per hour.
North East England was not far ahead with a median of £9.93 per hour.
London had the highest median hourly rate at £15.32 per hour.
The next highest hourly rate was £11.52 for the South East.
The median rate for Scotland was £10.79 - a little ahead of other regions such as the West Midlands and Yorkshire.

(source: ONS)

If your organisation has a regional pay policy - whether it's a London allowance or a complicated zone-based pay system - please tell us about it.

As ever, more information about this and other IRS surveys can be found at www.irsresearch.co.uk