October 2011 Archives

Health and safety or you pay

By Adam Bernstein on October 31, 2011 8:00 AM | 1 Comment
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The Government is planning to give the Health and Safety Executive a legal duty to make a cost recovery from organisations and businesses who are found to be in breach of health and safety law. Whilst this is nothing new to high risk sectors such as the offshore oil industry, it should be of concern to those that consider themselves low risk.

In simple terms, the proposals will mean that only those sectors covered by HSE regulation will be at risk; those that only deal with local authority regulation will not be subject to this system.

As for cost, HSE time will only be recovered where the breach is material - that is the matter is sufficiently significant to justify a formal letter or enforcement notice. Minor breaches won't be charged for. At a suggested hourly rate for an HSE inspector, a formal letter could cost £750 whilst an enforcement notice could cost £1500. At the extreme, a full investigation could cost tens of thousands of pounds.

You have been warned!

Digital Marketing

By Adam Bernstein on October 28, 2011 8:00 AM | No Comments
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In the seven months since March 2011 when the Advertising Standards Authority gained a remit to oversee digital advertising and marketing (in addition to the original print media remit), a huge number of complaints - some 5531 - have been lodged with the body. Overall, the ASA received 18369 complaints covering all forms of advertising that it covers - up 30 per cent over the same period in 2010. As a result, the ASA has had to increase staff numbers by ten per cent.

Those firms that find themselves on the wrong side of the ASA and its adjudications may find that they have their paid for advertising removed, receive adverse publicity, face a denial of advertising space and may even end up before the Courts for breaches of the Consumer Protection Regulations.

For the record, the ASA now oversees non-paid for online marketing campaigns that the advertiser controls including those that use Facebook and the company's own website.

EU Common Sales Law

By Adam Bernstein on October 27, 2011 8:00 AM | No Comments
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According to the Law Society, the European Commission is expected to issue a proposal for a Common Sales Law that would cover the whole of the EU.

Whilst the new Law would want to harmonise the internal European market and increase cross border trade, the Law Society thinks that it may actually raise difficulties for businesses and consumers in the UK. In particular, there would be questions over interpretation and application over elements of contract law.

Considering that our present legal system has been built up over centuries, it would take some time - and money - for private parties to litigate to create the new case law required. Further, the Law Society thinks that it would be difficult to apply the system uniformly across the 27 EU Member States.

Tribunal claims on the wane

By Adam Bernstein on October 26, 2011 8:00 AM | No Comments
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According to a recent set of statistics published by the Ministry of Justice, Employment Tribunal claims over the period April 2010 to March 2011 are down by 8 per cent to 218,100. Not bad at first glance. However, when compared to 2008/9's figures, the number of claims is still 44 per cent higher.

Other numbers worth noting from the statistics include unfair dismissal claims falling by 16.5 per cent to 47,000 in 2010/11 and redundancy claims down 16 per cent to 16000. Equal pay claims also falling 7.5 per cent to 34,600 in 2010/11.

Interestingly, of all the claims made, only 12 per cent were successful whilst 32 per cent were withdrawn and 29 per cent were mediated by ACAS. However, the average award was up from £1,000 in 2009/10 to £1,273 in 2010/11 and further, age discrimination claims rose 30 per cent to 6,800 in 2010/11.

What do the statistics show? Avoid a tribunal if appropriate and possible - whilst you may not lose the case, it'll still take up valuable management time. 

Ministers urge businesses to tackle employment red tape

By Adam Bernstein on October 25, 2011 8:00 AM | No Comments
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The next stage in the Government's Red Tape Challenge has kicked off and businesses are now being asked to tackle employment related law, bureaucracy and red tape.

The focus has moved to more than 160 different cross-Government employment related regulations that businesses have to deal with in all areas of the workplace.

The campaign is asking for a variety of suggestions about how regulations can be improved, simplified or even abolished, whilst also ensuring that the current standard of employment rights for employees are maintained.

Examples of regulations Government is seeking views on include the rules on collective redundancies, employment agencies, immigration checks, the National Minimum Wage and statutory sick pay, to make sure they are fit for purpose and easier for businesses to understand.


Unfair dismissal rule changes

By Adam Bernstein on October 24, 2011 8:00 AM | No Comments
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Changes to the rules on unfair dismissal rules are to be brought in by the Government. Under the new rules, from 1 April 2012 the qualification period for the right to claim unfair dismissal will be extended from one to two years. The Government say that 'this is the latest development in the Government's workplace reforms which aim to increase business confidence to take on more workers.' Employees organisations are naturally less than happy.

The changes follow the 'Resolving Workplace Disputes' consultation published in January 2011 which also proposed measures to encourage early resolution of disputes, the speeding up of the tribunal process and measures to tackle weak and vexatious claims.

The Government is hoping that the proposals should see the number of unfair dismissal claims drop by around 2000 a year.

Plans for two new Enterprise Zones

By Adam Bernstein on October 21, 2011 8:00 AM | No Comments
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The Government has asked the Lancashire and the Hull and Humber Local Enterprise Partnerships to develop proposals for two new Enterprise Zones following the recent announcement by BAE Systems about their sites in Brough, Warton and Samlesbury.

If successful, the goal is to have the new zones to be up and running by April 2012. Each Zone will have simplified planning rules, super-fast broadband and over £150 million tax breaks for new businesses over the next 4 years. They'll also benefit from a 100% business rate discount worth up to £275,000 over a five year period.

Changes aim for swifter justice over workplace deaths

By Adam Bernstein on October 20, 2011 8:00 AM | No Comments
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The Government is seeking more health and safety prosecutions before Inquests with changes to an agreement - the Work-Related Deaths Protocol - between those who investigate and prosecute work-related deaths.

Previously, only in exceptional circumstances were cases currently taken to an Inquest by regulators other than the Crown Prosecution Service. Health and safety offences were only usually brought at this stage if they were being tried in conjunction with manslaughter-related charges.

The revised rules from 1 October now allow prosecution before Inquest where manslaughter or homicide charges are not relevant.

Don't quote me

By Adam Bernstein on October 19, 2011 8:00 AM | No Comments
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Executive pay has never really left the spotlight. However, in today's straightened times, it's a very hot topic especially as executive pay of quoted companies is rising much faster than the pay of workers. And so the Government has recently published a discussion paper that looks at the issue of executive pay.

The paper examines the current pay landscape and looks abroad to see how other countries manage the situation. It then offers possible solutions including greater openness in pay, how pay and performance are linked, pay across an organisation and the process for setting pay.

It's quite likely that shareholders will be given more powers over setting of executive pay.

Comments are requested by 25 November.

Negligence and dismissals

By Adam Bernstein on October 18, 2011 8:00 AM | No Comments
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In most cases, serious negligence could be grounds for gross misconduct. But what happens if an employee has a lucky escape and nothing results from the negligence? Will a dismissal be unfair? Sadly for employees, the answer is 'yes' according to an Employment Appeal Tribunal that looked at the case of two lorry drivers who had let their HGV licences lapse.    

The two were required to renew their HGV driver's licences every five years. During a routine spot check it was discovered that their HGV licences had expired by one month and five months respectively. This meant that whilst driving without an HGV licence they were committing a criminal offence and potentially invalidating the employer's insurance. The lack of insurance could have been disastrous because of the dangerous loads the drivers were transporting and could also have led to action by the authorities that would have removed the licence necessary to run the haulage business. In the event, no action was taken by the regulators, but the both drivers were dismissed even though they both had good clean records.

The case is helpful for situations where an employee has been seriously negligent but been lucky. However, the drivers were not only negligent, but criminal - it's just like driving over the legal limit for alcohol. But where the negligence is neither criminal nor illegal, employers will have to carefully decide if dismissal is the right response.

Olympic Workforce?

By Adam Bernstein on October 17, 2011 8:00 AM | No Comments
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With the Olympics less than a year away, employers should start thinking about writing a specific Olympics policy to deal with requests for leave as well as any unauthorised absences. 

Any policy written needs to handle issues such as flexible working, timescales for requesting leave, a process for controlling just how many people you want off work at any one time, how declines are decided and how you'll deal with unauthorised absences. Indeed the latter point, if addressed correctly, will setup employee expectations so that, for example, they know that medical evidence will be required following an absence.

It's also worth building a section into the policy that deals with discrimination; it's quite likely that nationalism will rear its head during the Olympics and employers can be liable for discrimination in the workplace.

Remember that requests for holiday may be refused on business grounds as long as you are acting in good faith and are being as consistently as possible. You should also seek advice about your rights and obligations where employees want to be one of the 70,000 volunteers at the Games.

Lastly it wouldn't hurt to tell employees about any concessions you intend to make, such as television coverage in the workplace. But lay down clear rules about managing workload and any restrictions on watching internet coverage of the games. 

If you do need more information, ACAS can help with free information www.acas.org.uk/index.aspx?articleid=3401.

More personal liability for directors

By Adam Bernstein on October 14, 2011 8:00 AM | No Comments
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Pre-pack sales of failed businesses are a major irritant to all concerned, not least because of the appearance that the failed business can "dump" its debt and the buyers can start the same business all over again, debt-free, under a new company.

The reality for directors is not all that black and white. Apart from personal guarantees that they've given creditors over the failed business, HMRC is now sending directors Personal Liability Notices more frequently.

PLN's, created by the Social Security Administration Act 1992, are not nice; they make directors personally liable for the company's unpaid PAYE and National Insurance. However, HMRC can only issue a PLN if the failure to pay tax liabilities is "attributable to fraud or neglect on the part of one or more individuals who, at the time of the fraud or neglect, were officers" of the company.

Directors can appeal if the sum claimed in the PLN is not covered by the legislation; the failure to pay the tax liability was not attributable to any fraud or neglect by the director in question; the director was not an officer of the company at the time of the alleged event; or the opinion formed by HMRC when deciding to issue the PLN was unreasonable. 

The advice to directors accused of fraud or negligence is that they should be aware of their possible liability to HMRC, the company itself or its liquidator or administrator.  They shouldn't settle claims against them made by liquidators or administrators unless they can also be sure that they will not subsequently be issued with a PLN.

New bill will strengthen consumer rights

By Adam Bernstein on October 13, 2011 8:00 AM | No Comments
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The Government has announced that it's producing a new Consumer Bill of Rights to 'streamline confusing and overlapping legislation and regulation' and provide stronger consumer protection.

The Bill will update the law for goods and services and for digital content, clarify the law on unfair contract terms, consolidate consumer powers for Trading Standards, and provide much stronger protection for vulnerable customers targeted by misleading aggressive sales practices.

The Bill will bring together consumer rights currently found in 12 Acts or Regulations and the incoming European Consumer Rights Directive. It will be in simple English, making it easier for consumers and businesses to understand what is a complex and inconsistent area of law.

Penalty warning for paper tax returns

By Adam Bernstein on October 12, 2011 8:00 AM | No Comments
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With the 31 October deadline for paper tax returns very close, HMRC is urging taxpayers to get their paper tax return in on time, or face a penalty.

Those that send in a paper tax return on or after 1 November, will now be hit with a £100 penalty - even if there is no tax to pay or the tax due is paid on time - following the introduction of a new penalty regime this year. Also, the longer they delay, the more they'll have to pay, as there are further late-filing penalties after three, six and twelve months. Those that can't send in a paper return by 31 October can still avoid a penalty by sending their tax return online instead by 31 January. However, if they send in a paper return after the 31 October deadline, they cannot avoid the initial £100 penalty by subsequently filing online.

Employees get more help to quit smoking and get active

By Adam Bernstein on October 11, 2011 8:00 AM | No Comments
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Employee illness costs employers - and the country - a small fortune and to try to combat this, the Government is working with businesses through the 'Public Health Responsibility Deal' to help make the population healthier. So far, 285 organisations have signed up to be part of the programme.
The programme wants to influence the food, alcohol, physical activity and health habits of employees in the workplace and is offering guidance through a website.
Companies are being encouraged to get their staff to use online tools such as NHS Lifecheck - www.nhs.uk/lifecheck - to help improve their health and well being. They will also be asked to encourage their employees to take part in more formal screening programmes.
 
Earlier this summer, guides were also published to help employers and managers help people with long term conditions. These can be found at:
 

Buying a house could trip you up

By Adam Bernstein on October 10, 2011 8:00 AM | No Comments
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In September HMRC launched a joint venture with the Council of Mortgage Lenders and the Building Societies Association. For a fee of £14, mortgage lenders can apply to HMRC with borrowers details for cross checking against income tax and employment returns that are held on file. The idea behind the venture is to weed out any fraudulent applications.

On the face it this isn't a BusinessMan type story. However, delve a little deeper and you'll see why this story has made the page...it's because in receiving mortgage application details HMRC will be able to see who is (in)accurately reporting their income. After all, a discrepancy between the records will be lit up like a belisha beacon.

The programme isn't designed to be a 'free-for-all' for the lenders - there must be a reasonable suspicion of fraud. But who decides where there's a reasonable suspicion?

Interestingly, whilst the law behind the programme dates back to 2005, the US IRS has running something similar for sometime and they only charge mortgage firms $2.25.

New IP guidance for businesses

By Adam Bernstein on October 7, 2011 8:00 AM | No Comments
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A new guide for businesses to make sure they don't fall foul of intellectual property laws has been launched by the Intellectual Property Office. Preventing Infringement of Intellectual Property Rights in the Workplace provides companies with advice on how they can make sure they and their employees are not illegally using other people's intellectual property.

Criminal IP offences can take place in the workplace in a variety of ways. These include employees selling copies of protected works or supplying fake goods within the working environment; company servers and equipment being used to make available infringing content to the internet with the knowledge of management; using the work intranet to offer for sale infringing products to colleagues; external visitors entering your premises to sell counterfeit and pirated items; and using unlicensed software on business computer systems with the knowledge of management.

Copyright, patent, trade mark or design infringement could result in civil action or, in some cases of trade mark and copyright infringement criminal action being taken against the offending individual or company. If found guilty under criminal law, offenders are liable to a fine of up to £50,000 and/or a prison sentence of up to ten years.

Revised shortage occupation list

By Adam Bernstein on October 6, 2011 8:00 AM | No Comments
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The Migration Advisory Committee has advised the Government that the Shortage Occupation List should be revised to restrict migrants from outside the European Economic Area to a smaller proportion of occupations within the UK labour market.

This means that the list should soon be reduced to cover 190,000 employees [not migrants] or well under one per cent of the UK workforce. In 2008, before the MAC recommended changes to it, that list covered over one million employees.

The occupations in the list are the only positions open to migrants from outside the European Economic Area under the shortage occupation route of Tier 2 of the of Points Based System and Tier 2 is subject to an annual limit of 20,700.

The latest MAC recommended list provides a more detailed breakdown of the sectors of the labour market affected by shortage. This has enabled the MAC to identify individual job titles rather than broader occupations.

The list is more selective than before: it is targeted specifically on those job titles where there is currently a clear evidence of shortage.

Be Smart

By Adam Bernstein on October 5, 2011 8:00 AM | No Comments
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Many employees are given smartphones by their employers. But have those employers stopped to write a policy on how these devices should be used? According to Spring Technology, an IT Recruitment firm, the etiquette for smartphone use is unclear and they offer some tips:

Firstly employees need to know why they've been given the device. Is it a perk or a means to an end? Employees then need to be told to keep work and private communications separate - it'll save embarrassing emails and texts being attributed to a business.

Employees should be told that the smartphone isn't a way of extending the day to get closer to deadlines. Similarly, employees shouldn't be expected to be available 24/7 - it's not good for morale. However, this rule needs some form of differentiation between the grades of staff, say trainees and company directors. At the same time, if clients are given a number to call in emergencies, make sure it's rotated amongst all staff for fairness.

Finally - give your staff guidance on what is allowed when it comes to using the device on foreign travels, whether that is private or for business. No-one likes nasty bills.

HMRC extends Business Records Checks

By Adam Bernstein on October 4, 2011 8:00 AM | No Comments
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HM Revenue & Customs has begun an extension of its Business Records Checks programme.

Piloted earlier this year in eight areas, the programme involves checks on the adequacy of small and medium-sized enterprises' business records.

The pilots found that around 44 per cent of businesses visited had issues with their record-keeping, while around 12 per cent of those visited had seriously inadequate records.

HMRC is planning to complete up to 12,000 Business Records Checks by the end of the current financial year, with 20,000 provisionally planned for 2012/13. HMRC is increasing the number of visits, so it can refine the process, before final decisions on a national roll-out are taken in the New Year.

Initially, HMRC will only levy a record-keeping penalty in the most extreme cases of poor record-keeping. In the longer-term, HMRC intends to issue penalties of up to £3,000 for serious inadequacies in record-keeping. HMRC will issue guidance on this, and make a further announcement on when it will happen, in due course.

A guide to setting up a record-keeping system is available from the Business Link website at www.businesslink.gov.uk/startrecordkeeping/

Incident Reporting

By Adam Bernstein on October 3, 2011 8:00 AM | No Comments
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Businesses are being reminded by the HSE about new incident reporting arrangements that were introduced last month.

As reported on 7 June by BusinessMan, from 12 September, only fatal and major injuries and incidents will be able to be reported by phone to the Health and Safety Executive, with all other work-related injuries and incidents reportable under RIDDOR to be reported via one of a suite of seven online forms available on HSE's website.

Businesses also need to be aware that from 30 September, the HSE's Infoline telephone service which provided a basic information service to callers ended. Instead, those seeking information and official guidance need to visit HSE's website where they can access and download resources and use interactive web tools free of charge.

At the time as this latest change, improvements have been made to HSE's website. These include clearer information on what HSE does and doesn't do, and expanded 'question & answer' sections for the most frequent health and safety enquiries such as those on RIDDOR reporting and First Aid.
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