Article
One: Employment and the Law - Recent Developments by
Louise Fernandes
Louise Fernandes of Field Fisher Waterhouse LLP focuses on recent employment law developments below.
National Minimum Wage on the up
The national minimum wage rates increase today (1 October). The adult hourly rate rises from £5.52 to £5.73. The rate for 18 to 21 year olds also increases, from £4.60 to £4.77, and the 16 to 17 year old rate rises from £3.40 to £3.53.
The Department for Business Enterprise and Regulatory Reform (BERR) has also recently published revised guidance on workers’ rights and employers’ obligations under national minimum wage legislation. The guide intends to help employers ensure that they comply with the legislation and to help workers establish whether they are receiving their entitlement.
Heyday case – Advocate General's Opinion
The Advocate General has delivered his Opinion on the much publicised proceedings brought by Heyday to challenge, amongst other issues, the mandatory retirement age of 65 under the Employment Equality (Age) Regulations 2006 (the Age Regulations).
In a blow to the Heyday challenge, his Opinion states that:
· the Equal Treatment Directive, which provides the framework for equal treatment in employment and occupation, is applicable to national rules, such as the Age Regulations, which permit employers to dismiss employees aged 65 and over by reason of retirement. This follows the decision of the European Court of Justice (ECJ) in Palacios de la Villa v Cortefiel Servicios SA last year.
· a rule which permits employers to dismiss employees aged 65 or over for retirement can, in principle, be justified - if the rule is objectively and reasonably justified in the context of national law by a legitimate aim relating to employment policy and the labour market, and it is not apparent that the means to achieve that aim of public interest are inappropriate and unnecessary for the purpose.
· there is no requirement for national rules to define the kinds of treatment which may be justified (e.g. by means of a list).
Although the Advocate General’s Opinion is a disappointment for those involved in the Heyday challenge, it is not the final word on this case, as the next stage is the ECJ decision which is likely to be next year. The Advocate General’s Opinion is usually, but not always, followed by the ECJ. If the ECJ does agree with the Advocate General, it will be for the High Court to consider whether the mandatory retirement provision is in fact objectively justified.
Discriminatory shortlisting process
An Employment Tribunal has confirmed that an employer who advertised for candidates “in the first five years of their career” indirectly discriminated against a 61 year old claimant when it failed to shortlist her for the position. The claimant was plainly in an age group which would be disadvantaged by the employer’s approach.
In Rainbow v Milton Keynes Council, the Tribunal confirmed that the rejection letter received by the claimant concealed the true reason for rejection, which was one of costs. The Tribunal stated that if cost was to be put forward as justification for the decision not to shortlist the claimant, it should be combined with other reasons. There was no adequate evidence that the relevant budget required the employment of someone within the first five years of their career and there was no evidence of any other financial strategy.
The Tribunal noted that there is no automatic bar on economic grounds coming into the equation on justification, certainly where combined with other reasons. The Tribunal stated that if cost is going to be put forward as a justification for an otherwise discriminatory practice, the evidence should be such that the employer was more or less compelled to take the discriminatory decision for reasons of costs plus other reasons.
New review to examine how to boost employee performance
Business Secretary John Hutton has announced a review to examine new ways to boost the performance of employees and improve British business success.
The “Review of Employee Engagement and Investment”, which will make recommendations in the New Year, intends to:
· identify and understand in practice how businesses improve productivity by engaging with and investing in their employees
· examine the benefits of employee engagement and investment in terms of UK competitiveness and productivity and the effect on individuals’ career progression
· identify whether there are barriers to businesses adopting good practice
· make recommendations to address any market failure, eliminate barriers and encourage wider adoption of good practice
Louise Fernandes is the Professional Support Lawyer in the Employment and Pensions Group at Field Fisher Waterhouse LLP and can be contacted at
louise.fernandes@ffw.com
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