Presentation by Laura Merrylees, Employment Law Editor, XpertHR and Sheila Attwood, Managing Editor, Pay and HR practice, XpertHR

1. Employment Law Update
Laura Merrylees and Sheila Attwood

2. Employment law update - agenda
• Trade Union Act 2016
• Public sector exit payments – repayment and cap
• Holiday pay
• Gender pay gap reporting
• Apprenticeship levy

3. Trade Union Act 2016

4. Trade Union Act 2016 - Balloting
• 50% turnout threshold of those entitled to vote for
all ballots – simple majority of those voting in
favour of action
• Additional threshold of 40% of those entitled to
vote in ballots related to important public services
(IPS) must vote in favour of action

5. Trade Union Act 2016 – Important
public services
• Additional 40% threshold applies where the
majority of those are “normally engaged” in the
provision of important public services
• Government to introduce regulations and guidance
defining those subject to 40% threshold
• To include health, education, transport, fire, border
security and other public-services sectors
• “Reasonable belief” defence for a trade union

6. Trade Union Act 2016 – Electronic
balloting
• Government has committed to an independent
review of electronic balloting for strike ballots
within 6 months
• No legal commitment to its introduction

7. Trade Union Act 2016 – Industrial
action
• Doubling of minimum notice of industrial action to
14 days (or seven by agreement)
• Voting paper to include a summary of the dispute,
period within which action is expected to take
place and type of industrial action, short of a strike,
where relevant
• Ballot mandate expires after six months, or up to
nine months if both sides agree

8. Trade Union Act 2016 – Picketing
• Union must appoint a picket supervisor who is
readily identifiable at picketing location
• Supervisor to have a letter of authorisation from
union and be familiar with Code
• Authorisation letter to be shown to the employer
on request

9. Trade Union Act 2016 – Check off
• Check-off deductions for union members in the
public sector can still be made subject to conditions
• Alternative means of payment available to
members
• Union makes reasonable payments towards
employer’s costs for the deductions
• Government to delay implementation by 12
months

10. Trade Union Act 2016 – Facility time
• Public-sector employers with at least one trade
union official required to publish facility time
information
• Further regulations required to introduce the
change
• Provision to allow Government to bring future
regulations into force capping amount and cost of
facility time

11. Public sector exit payments
– repayment and cap

12. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Provision for repayment contained in the Small
Business, Enterprise and Employment Act 2015
• Repayment of Public Sector Exit Payments
Regulations 2016 – Government originally
intended to implement by April 2016
• Latest consultation closed on 25 January 2016

13. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Provision for higher earning public-sector
employees to repay an exit payment if they re-join
the public sector within a year
• Earnings threshold of £80,000
• Applies to individuals who return to any part of the
public sector
• Applies to contractors who return “off-payroll”

14. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Amount to be repaid will be reduced by a taper
over time
• Applies to employer payments to provide
unreduced pensions on early retirement
• Amount of any statutory redundancy payment will
not be subject to repayment

15. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Payments in scope for repayment include:
• Redundancy (voluntary and compulsory)
• Payments of the balance of a fixed-term contract
• Settlement agreements

16. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Excluded payments include:
• For incapacity resulting from accident, injury or illness
• Payment in lieu of notice
• Accrued but untaken leave

17. Draft Repayment of Public Sector Exit
Payments Regulations 2016
• Former employer obliged to keep a record of the
payment for three years
• Employee obliged to inform old and new employer
if exit payment has been made in last 12 months

18. Draft Public Sector Exit Payment
Regulations 2016
• Provision included in the Enterprise Act 2016
• Draft Public Sector Exit Payment Regulations 2016 –
expected to come into force in October 2016

19. Draft Public Sector Exit Payment
Regulations 2016
• Limits the total aggregate value of an exit payment
to a public-sector employee to £95,000

20. Draft Public Sector Exit Payment
Regulations 2016
Payments that form part of the cap include:
• Redundancy (voluntary or compulsory)
• Payments of the balance of a fixed-term contract
• Payment in lieu of notice
• Settlement agreements
• Employer payments to provide unreduced pensions on early retirement
Excluded payments include:
• Injury or ill health related payments
• Accrued but untaken leave

21. Future developments
• Consultation on reforms to public-sector exit payments –
closed on 3 May 2016
• Consultation on reform of IR35 legislation in the public
sector – due to close on 18 August 2016

22. Holiday pay

23. Holiday pay – Overview
• Working Time Regulations 1998 implement the
European Working Time Directive
• Health & Safety measure
• Workers are entitled to 5.6 weeks’ leave in each
leave year

24. Holiday pay – Overtime hours
• Worker must receive “normal remuneration”
during period of paid annual leave
• British Airways Plc v Williams and Others –
payments should be included in the calculation of
holiday pay if they are “intrinsically linked” to the
performance of the worker’s duties
• Neal v Freightliner Ltd – Employment Tribunal
decision which found that elements including shift
premia and overtime should be included

25. Holiday pay – Overtime hours
• Bear Scotland Ltd and others v Fulton and others;
Hertel (UK) Ltd v Woods and others; Amec Group
Ltd v Law and others [2015]
• Concerned compulsory but non-guaranteed
overtime
• Non-guaranteed overtime to be included in the
calculation of holiday pay
• Patterson v Castlereagh Borough Council [2015]
IRLR 721 NICA – inclusion of voluntary overtime
where “normally carried out” and was an
“appropriately permanent feature” of the worker’s
pay

26. Holiday pay – Overtime hours
• Guaranteed and obligatory non-guaranteed
overtime to be included in the calculation of
holiday pay (NB appeal in Lock v British Gas)
• Voluntary – is it part of “normal remuneration”
• Claims – series of deductions broken by a gap of 3
months
• The Deduction from Wages (Limitation) Regulations
2014 (SI 2014/3322) – claims brought on or after 1
July 2015 limited to two years

27. Gender pay gap
reporting

28. Gender pay gap and equal pay
• Current obligations - public sector equality duty
• Definitions:
• Equal pay – differences between individuals or groups
performing the same or similar work
• Gender pay gap – differences in average earnings of men
and women, regardless of role

29. Why gender pay gap reporting now?
• Representation
• Senior levels
• More women than men in lower-paid roles
• Impetus
• If measure the gender pay gap, and report it,
are more likely to act on it
“What gets measured gets
managed; what gets publicly
reported gets better managed”

30. Gender pay gap reporting
• Equality Act 2010 (Gender Pay Gap Information)
Regulations 2016
• Private and voluntary sector
• 250+ employees – someone who “ordinarily works
in Great Britain and whose contract of employment
is governed by UK legislation”
• Annual reporting

31. Gender pay gap measures
Five benchmarks to report:
• Mean and median pay
• Bonus pay
• Receipt of bonuses
• Pay bands
Definitions
• What constitutes pay?
• What is a bonus?
• Quartile pay bands

32. Gender pay gap outcomes
• Five benchmarks - no raw data
• Confirmation information is accurate
• 12-month time lag
• Employer’s website, plus government website – league
table or database?
• Narrative
• Why is there a gap?
• What are we doing about it?
“If you don’t
tell your story,
someone else
will”

33. What's next?
• Regulations come into force – expected October
2016
• Pay – 30 April 2017
• Bonuses – 30 April 2016
• Public sector – Government pledged to "extend our
plans for gender pay gap reporting…to include the
public sector"

34. Apprenticeship levy

35. Apprenticeship levy
Paying in….
• 6 April 2017
• 0.5% of entire paybill (wages, bonuses, commissions,
pension contributions). Minus £15,000pa allowance
• All employers, with a paybill of more than £3 million a
year. Payable through PAYE the next month
…Getting out
• Digital apprenticeship service account + top-up (England)
• Time-bound

36. Apprenticeship levy – planning ahead
• Funding the levy
• Can't be used to pay wages
• Change to National Insurance Contributions
• Training
• Existing apprenticeships continue under current funding
arrangements
• Review of training
• What might you want to change? What roles could be done as
an apprenticeship

37. For further information on employment law, good
practice and other HR resources, visit us online:
www.xperthr.co.uk
XpertHR
laura.merrylees@xperthr.co.uk
sheila.attwood@xperthr.co.uk