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Employer fined £350,000 for workplace pension failures

Employers are being warned not to put their head in the sand after one business ended up with a £350,000 fine for failing to fully comply with its pension duties.

The anonymous case study is included in the most recent quarterly compliance and enforcement bulletin from The Pension Regulator (TPR).

Despite warnings from TPR, the employer, which has 5,000 staff, allowed an Escalating Penalty Notice to grow before correctly re-enrolling staff into the company pension scheme and paying the right contributions.

TPR director of automatic enrolment Darren Ryder said:

“This size of the fine is rare as the vast majority of employers now consider automatic enrolment to be an everyday part of running their business and helping workers to save. However, this case is a stark warning that failing to address problems early can lead to hefty fines which could be avoided…”

Following TPR’s intervention, the London-based company has now re-enrolled more than 40 staff and paid more than £100,000 of backdated pension contributions, as well as ensuring ongoing contributions are correctly calculated and paid. The backdated payments, which are in addition to the fine, cover both the re-enrolment failure and incorrect contributions affecting more than 2,000 staff.

Darren Ryder also highlighted how vital it is to carry out both ongoing duties and re-enrolment correctly. TPR will take action to ensure that not only are staff put into a pension, but they continue to receive the correct contributions on an ongoing basis and that those who opt out are re-enrolled correctly and given their right to start saving.

The quarterly compliance and enforcement bulletin, which reports on TPR’s use of powers between April and June 2019, also highlights how:

  • As part of TPR’s new supervision approach, its relationship supervision teams are finding high standards and well-run schemes
  • TPR authorised seven master trust schemes in the period under section 13 of the Pensions Act 2017
  • TPR published a Determinations Notice detailing the first time it used its power to appoint a trustee primarily because of a lack of competence of the existing trustee board
  • More than 200,000 employers have met their re-enrolment responsibilities and tens of thousands of small employers (those with fewer than 50 staff) are approaching the third anniversary of their staging date

Source: cipp 23-08-2019

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Government consult on flexible workers receiving compensation if shifts are cancelled

The government has opened a consultation on proposed new measures for flexible workers which will give them more rights as well as compensation if their shifts are cancelled at a short notice.

This will advance the government’s Good Work Plan, “the largest upgrade to workers’ rights in a generation.” The Good Work Plan was announced in December 2018 and formed the Government’s response to Matthew Taylor’s independent Taylor Review of modern working practices (2017).

The new measures the Government will consult on for flexible workers will include:

  • compensation for workers when shifts are cancelled at short notice
    entitlement to a reasonable period of notice for their allocated shifts
    additional protections for individuals who are penalised if they do not accept shifts last minute

Mr Taylor’s review found that zero hours contracts work for the majority of these workers as it gives them the flexibility they need, however, he said that the Low Pay Commission should look in to the issue of one-sided flexibility.

In December 2018 the Low Pay Commission researched this issue and found that parts of the labour market where employers are misusing flexible working arrangements leading to unpredictability in working hours, income insecurity and a reluctance among workers to assert basic employment rights.

The Low Pay Commission also found that 1.7 million flexible workers feel “anxious” that their working hours can change unexpectedly. As well as under half (40 per cent) saying their hours “tend to vary from week to week”.

Ben Willmott, head of public policy for the CIPD said:

If we want to create fairer, more inclusive workplaces we must address one-sided flexibility that benefits businesses but puts individuals at a disadvantage. Zero hours contracts can offer people flexibility they need but it’s been far too easy for some employers to cancel shifts with very little or no short notice. Workers not only lose out on pay but also suffer unnecessary travel costs and disruption. It’s absolutely right to make companies pay reasonable compensation if this happens and we welcome this, and other measures proposed to protect workers on variable hours.

The introduction of a right to switch to a more predictable work pattern should give workers more choice over their working arrangements. However, circumstances in which employers can refuse this will need to be clear. A right to reasonable notice of work schedules is also a proposal that will be welcomed by atypical workers and good employers as long as there is flexibility over what is ‘reasonable’ given the nature of the work.

Greg Clarke, business secretary said:

Innovative entrepreneurs and new business models have opened up a whole new world of working patterns and opportunities, providing people with freedom to decide when and where they work that best suits them.

It’s vital that workers’ rights keep pace with these changes, reflect the modern working environment and tackle the small number of firms that do not treat their staff fairly.

We are the first country in the world to address modern working practices and these protections will cement the UK’s status as a world-leader in workers’ rights.

Bryan Sanderson, chair of the Low Pay Commission said:

We are delighted to see the government taking forward our recommendation to consult on these measures.

Last year we looked at the data on one-sided flexibility and talked to workers and businesses across the UK. Our report, published in December, found that shift cancellations and short notice of work schedules were significant problems, especially for low-paid workers.

The proposed changes, part of a package of policies we suggested, have the potential to improve work and life for hundreds of thousands of people.

These new proposals follow the announcement that the government is consulting on whether or not to create single labour market enforcement body which will have the power to make sure minimum wage and holiday payments are offered to employees.

The government is inviting views on flexible working and the consultation will be open for 12 weeks.

Source HRreview 22-07-2019

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UK employees are not receiving the right amount of holiday leave

Deck chairs on Brighton beach

Two million UK workers are not receiving their legal holiday entitlement.

According to new research by TUC, it has been revealed that roughly two million UK employees are not getting their minimum legal holiday entitlement. In addition to this, it has been calculated that around one million workers in the UK are not receiving any paid leave at all.

TUC found the leading reasons for this were unreasonably heavy workloads, employers denying requests for holiday leave and employers following outdated laws.

The Working Time Regulations Act 1998 states that UK workers are entitled to a minimum of 5.6 weeks, or 28 days, of paid leave.

However, around 7 per cent of UK employees are getting fewer holidays. The statistics also shows that 8.3 per cent of female employees are not receiving the correct amount of holiday leave. This is in contrast to 5.9 per cent of male employees.

Additionally, Northern Ireland has the highest number of employees not receiving their legal holiday entitlement with almost 10 per cent (9.2) missing out. This is followed by Eastern England and London, with 7.7 and 7.5 per cent of employees respectively.

The region least affected is the North West of England where only 5.6 per cent of employees are not receiving the correct holiday entitlement.

Additionally, tombola, an online bingo website, conducted a survey concerning work life-balance as it proved to be one of the most prevalent topics of interest amongst its community members.

This research actually uncovered that even when workers are given the correct amount of time off, half (50 per cent) of UK employees were made to feel uncomfortable when they requested time off.

Furthermore, 28 per cent of workers in the UK have more than five days of holiday allowance unspent in a year, revealing that around one in three employees work an extra full working week for free.

Malcolm Gregory, a partner in the employment law team at Royds Withy King, said:

The law has prescribed minimum paid holiday since 1998 and workers’ rights in this connection are reasonably well known. This issue is not just about employers flouting the law but also about workers taking responsibility for their wellbeing and understanding the health implications of not taking a reasonable amount of time off.

Workers who wish to compain can do so and will be in strong position to enforce their legal rights. Provided the Tribunal system remains free to use, there is no barrier to justice.

A more effective solution for this issue might be to consider how the health and wellbeing agenda can be publicised to greater effect. If the message is heard widely by all workers, it will be difficult for employers to seek to avoid or turn a blind eye to the existing law.

TUC said:

Minimum holiday entitlements are a vital part of reducing overwork. People who work excessive hours are at risk of developing heart disease, stress, mental illness, strokes, and diabetes, which also impacts on co-workers, friends, and relatives.

Research by the TUC came from the Labour Force Survey whereas research by tombola was collated from the results of a survey of 300 people.

Source HRreview  22-07-2019

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Bank holiday warning: a rise in holiday requests before and sick leave after

The Friday before the August bank holiday (23rd August) is the most popular day for employees to book holiday leave, with absences possibly spiking after it as well.

This data was collected by BrightHR, a HR software and e-day the web-based HR application for managing your staff holiday and absences.

BrightHR found out that the 23rd August has been the most popular day to book off for the past three years.

Alan Price, CEO of BrightHR said:

Over the past few weeks, employers across the UK have been bombarded with holiday requests for the 23rd of August with many worrying if they approve all holiday requests from workers they will be understaffed during the bank holiday weekend.

Although the Working Time Regulations 1998 instructs that all employees are entitled to 5.6 weeks of paid leave a year, employers are under no obligation to accept all leave requests. It is down to the discretion of the employer when their workforce takes annual leave, meaning you are well within your rights to refuse a request for leave if it clashes with other employees.

However, It is important to remember that all employees place great significance on their leave entitlement and refusal can often be met with annoyance.

On the other side of the coin, e-day found that employee absences will likely spike after the August bank holiday.

The State of Absence report conducted by e-day which measures data from 172,048 users of the e-day absence management system said there are three likely reasons why there is a rise in the amount of employees not coming in to work after the bank holiday. These are genuine sickness, a chance of a four-day break and an over-indulgent weekend.

Clare Avery, head of people and culture at e-days, said:

A key reason for sickness, is of course, sickness. Spending time with others in public spaces could contribute to an increase in minor illnesses. Yet without trying to cast aspersions, human nature also says its possible that more people fancy a four day break, and others pull sickies from ‘too much sun and fun’.

The important thing for employers is to learn when and why your employees are more likely to call in sick, as you may spot opportunities to make some lasting improvements to your workplace and your company culture.

The absence management company suggested certain ways to alleviate this problem in a business, by setting up a prize for the funniest bank holiday activity or a team prize for the least amount of absences.

Implementing flexible working can also help this situation as well as making sure your staff are not over worked. Ensuring that the employee should stop working at the end of the day.

Source HRreview 22-08-2019

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Update on the EU Settlement Scheme

There have been reports in media and on social media regarding the rights of EU citizens resident in the UK after we leave the European Union.

Some inaccurate reporting has suggested that, once freedom of movement ends after Brexit, EU citizens resident in the UK will be left in “legal limbo”.

However, EU citizens and their families are welcome to stay and there are no changes to the deadline to apply to the EU Settlement Scheme.

This scheme covers all EU citizens and their families living in the UK by 31 October, and EU citizens have until at least 31 December 2020 to apply.

Here is a short explainer:

What is happening? Is freedom of movement ending on October 31?

We are leaving the EU on 31 October come what may. This will mean that freedom of movement as it currently stands will end on 31 October when the UK leaves the EU.

What does this mean? Will EU citizens still be able to come here on holiday?

EU citizens will still be able to come to the UK on holiday and for short trips, but what will change is the arrangements for people coming to the UK for longer periods of time and for work and study. Details of other changes immediately after 31 October and improvements to the previous government’s plans for a new immigration system are being developed.

When is the new immigration system going to be in place?

Details of other changes immediately after 31 October and improvements to the previous government’s plans for a new immigration system are being developed and the government will set out its plans shortly.

The Prime Minister has been clear that he wants to introduce an Australian style points-based immigration system. The Home Secretary is commissioning the independent Migration Advisory Committee (MAC) to examine this.

We will take back control of our borders while welcoming the talented and hardworking people that the British economy needs.

Doesn’t this create great uncertainty for EU citizens?

The Prime Minister has made it clear that all EU citizens resident here by 31 October will be welcome to stay and they are eligible for the EU Settlement Scheme.

More than one million people have already been granted settled or pre-settled status under the EU Settlement Scheme, meaning that their rights are enshrined in law.

This scheme covers all EU citizens and their families living in the UK by 31 October.

How do you apply to the EU Settlement Scheme?

The EU Settlement Scheme makes it easy for EU citizens and their family members who want to stay in the UK to get the UK immigration status they need.

It’s free and they only need to complete three key steps – prove their identity, show that they live in the UK, and declare any criminal convictions.

The easiest way to apply is online. EU citizens have until at least 31 December 2020 to apply.

Source Gov.uk 22-08-2019