For many years the payroll profession has been intrinsically linked to employment law. You can normally bet your bottom dollar that if new legislation is announced under the title employment law, it will have some impact on payroll. For this issue, I thought it might be helpful if I highlighted some of the key employment cases that have arisen recently, that may impact payroll in some way. I was made aware of these cases by my professional body; the Chartered Institute of Payroll Professionals.
“Bumping” and redundancy
Yes “bumping” really is a term used and means when an employee, whose role has been made redundant, is then redeployed into another role, where that displaced occupier of the second role is dismissed instead! A recent case of Mirab v Mentor Graphics (UK) Ltd ruled on the question of whether an employee must specifically raise “bumping” before an employer needs to consider it. The Employment Appeal Tribunal said they didn’t and instead the decision not to consider “bumping” must be viewed with the “range of reasonable responses” test. In this case the claimant, whose role had been made redundant, had challenged the redundancy dismissal, but the tribunal found that it was a fair redundancy dismissal as the employer had carried out sufficient actions to seek alternatives, without the need to consider “bumping”. The EAT clarified the error of the tribunal by saying that there is no rigid rule stating an employer should consider “bumping” nor is there any rule saying they shouldn’t! Any redundancy process should be fair and all reasonable options considered. Who knew?
Can you make a pregnant worker redundant?
Staying with redundancy, there are many employers who are of the belief you cannot make a pregnant worker, or one on maternity leave, redundant. This isn’t correct as long as due process is followed, which includes providing the worker with justifiable reasons and the objectives, for which the criteria used, meant she was to be dismissed. This has been confirmed in the recent case of Guisado v Bankia and Others where the Court of Justice of the European Union (CJEU) ruled that the Pregnant Workers Directive 92/85 does not prevent national legislation which allows an employer to dismiss a pregnant worker in the context of a collective redundancy.
The Pregnant Workers Directive 92/85 prohibits the dismissal of workers during the period from the beginning of their pregnancy to the end of their maternity leave, save in exceptional cases not connected with their condition which are permitted under national legislation and/or practice.
This case tests the challenge raised by a worker of the Spanish company Bankia, which opened a period of consultation with its workers’ representatives on 9 January 2013 with a view to carrying out a collective redundancy. On 8 February 2013, the special negotiating body reached an agreement establishing the criteria to be applied in selecting the workers to be made redundant, as well as the criteria for establishing priority status for retention in the company.
On 13 November 2013, Bankia notified a worker, who was pregnant at the time, of her dismissal by letter in accordance with the agreement drawn up by the special negotiating body. That letter stated, among other things, in the specific case of the province where she worked it was necessary to significantly reduce the number of staff and that, as a result of the assessment process carried out in the undertaking during the consultation period, she had obtained a score that was among the lowest in the province.
The court ruled in favour of Bankia. However, the worker then appealed against that judgment but the CJEU said that a dismissal decision taken during the period from the beginning of pregnancy to the end of the maternity leave for reasons unconnected with the worker’s pregnancy is not contrary to the Pregnant Workers Directive 92/85, if the employer gives substantiated grounds for the dismissal in writing and the dismissal of the person concerned is permitted under the relevant national legislation and/or practice.
Unpaid trial working
For those of you who, like me, listen to Radio 2 you may have heard the Jeremy Vine show about unpaid trial working. I must admit I was pretty shocked to hear that some employers will interview a candidate and then ask them to work a trial period of 2 weeks or more, without getting any money for it! Back in July 2017, sponsored by Stewart Malcom McDonald MP, the Unpaid Trial Work Periods (Prohibition) Bill 2017-19 which is a Private Member’s Bill was introduced to Parliament and was due to have its second reading at the time of writing this article. If the Bill is successful and becomes law it would potentially mean, amongst other things, that an employer would be required to pay job applicants undertaking trial periods and pay them at least the National Minimum Wage.
What I think will be interesting is if it all goes through, which to be fair you can appreciate why it might, is what will the definition of a trial be? I know of many employers who very fairly run assessment centres to try and minimise the risk of taking someone on, especially if expensive training will be offered, that isn’t suitable for the job. It can benefit both employers and the prospective employees to help the decision making of whether to employ, or whether to accept employment. If you offer unpaid trials as standard practice, you may want to follow this Bill?
If you would like any more information or advice about how employment laws can affect your payroll, get in touch
