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Default Retirement age to be scrapped

Added: 2010-07-29 10:38:19.0
After months of speculation, the government have announced plans to scrap the default retirement age in the UK from October 2011.  This means that employers will no longer be able to dismiss staff without compensation, once they reach 65.

The new plans, which have been largely debated over the past year or so, signify a bold move for the government and many had expected that they would simply increase the default retirement age to somewhere between 66 and 70.  Instead they have opted for a complete removal and have provided only one stipulation for employers; that they must hold a meeting with the employee at least 6 months before the employee’s 65th birthday.  In this meeting, they can discuss the future with the employee; and it is then entirely at the discretion of the employer whether or not to end the employment.

The wheels have now been put in motion to bring this new legislation in and it is expected that employers will begin to feel the changes in April of next year, given the 6 month meeting rule discussed above.  It is likely therefore that after next April, no forced retirement notices could be issued.

Although retirement age reform was included in both coalition government party manifestos, many would have expected more warning before introducing such an important piece of legislation.  According to the CBI, the government are moving too fast with this potentially landmark legislation and have warned that they are leaving businesses “with many unresolved problems”.  

From what we have seen of the coalition government so far, it appears that they are not wasting any time in introducing what they see as a crucial measure to steady the economy.  The government will hope that making this change will encourage people to work for longer and not be so dependent on the state.  Although those who are 65 and older will be entitled to the state pension, the fact that they may still be paying tax on earnings should help with the budget deficit.  Some activists have even argued that the change will inject billions of pounds into the economy.

What will this mean for your company paperwork?

This new legislation signifies a fundamental change in the ways that businesses will need to operate.  It will also have a big impact on companies’ HR paperwork; both the employees’ contracts (not just for staff members who are close to 65) and the company’s staff handbook will need to be revised.  Failure to do so could create large problems for the employer.

Fear not though, Cleardocs will be here to help.  Although these measures have only be announced today, we are already working on making sure that we are ready to be on hand to help businesses implement the new rules as quickly and as easily as possible.  More to follow in due course.


How do you feel about the change?  Do you think it’s a step in the right direction and the removal of an antiquated rule?  Or do you think that it will make things more complicated and is removing the default retirement age taking away yet more power from the employer?  Let us know by commenting below.

 
The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.
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British staff pull the most sickies in Europe

Added: 2010-07-26 15:21:06.0

Do you ever wonder whether your employee is actually ill when they call in sick? You could have reason to be doubtful as new research shows that one in five employees in the UK say that they have taken sick days for personal reasons in the past, rather than because they were ill.

The study, conducted by AON Consulting, surveyed 7,500 workers across Europe and the results do not make pretty reading for UK business owners.  As well as many people feigning illness for personal reasons, 1 in 8 British workers also admitted to lying about being ill in order to look after a member of their family.  This year’s World Cup would not have improved matters for employers.

As well as the detrimental effect that sick days can have on businesses, according to research by the CBI, sick days cost the UK economy £2.5billion a year.  A considerable amount considering the current deficit that that UK faces.

Compared with the rest of Europe, workers in the UK are the second most likely to feign illness to take a sick day.  Spanish employees are the worst offenders. Workers in Norway and Demark the least likely to ‘pull a sickie’.

Commenting on the findings, Peter Abelskamp, Director of health and benefits EMEA, at Aon Consulting said: “A billion hours taken as fictitious sick leave across Europe and the associated financial cost for businesses are probably conservative figures, considering the number of people who don’t admit to faking sickness and the fact that these costs only account for direct wages. Employers would be well advised to tackle the issues of sickness and workplace absence, as these seriously impact efficiency and hit their balance sheets.

56% of workers say they would not feel forced to take a day as sick leave if they could just be honest and have access to flexible working hours or ‘social days’. Of course employers should also not ignore the fact that 15% of people say that more interesting work would keep them in the office.”

What can employers do?

From an employer’s point of view, suspecting that an employee is feigning illness is not an easy situation to be in.  Wading in with accusations is more likely to create more problems than to resolve the situation.  There are a couple of things employers can do though to ensure that the situation is handled in the correct manner:

Sickness Policy

The first step than an employer can do is to ensure that they have a compliant, fair and up to date sickness policy.  Do your staff know what theri obligations are to you when they are ill?  Do they know that they may need to provide a fit note?  The sickness policy, usually found in the staff handbook can take care of this and let them know how the situation will be handled company-wide. 

Read more about the Cleardocs staff handbook. 

Not sure about how fit notes work? Listen to our webinar about fit notes and find out why you need to make sure your paperwork is updated.

Return to Work form

The knowledge that a short interview will take place when the employee returns to work may help to curb absences.  Typically this would take the form of a return to work form that can be downloaded from Cleardocs for free.  Read more about the Return to Work form.

Alternatively, if you have any concerns about the sickness policy you are currently using and are unsure whether it is up to date, call Cleardocs on 0845 474 0372.  We will be happy to discuss your requirements with you.

 
The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.

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New copy and paste functionality

Added: 2010-07-12 17:08:01.0
Those of you who regularly follow the Cleardocs blog will know that we’re always looking to make life easier for employers.  We’ve now put our money where our mouth is by launching our new ‘copy and paste’ functionality that makes Cleardocs even simpler to use.

We pride ourselves on the fact that the majority of our customers have told us that Cleardocs is dead easy to work with.  However, having supplied thousands of businesses with HR documents over the last 2 years, we found that if customers had one suggestion for improvement it was that they wanted to be able to carry the information that they’ve already filled out in one document over into a new document.

If there’s one thing we like to do at Cleardocs, it’s listen to our customers’ feedback; hence we’re very pleased to launch our copy and paste functionality.  As with everything we do, we wanted to keep it simple and our innovative development is a remarkably straight forward idea: having created, finished and paid for - as an example – a standard contract of employment for one employee, the business owner simply clicks on ‘copy and paste’ within the Cleardocs online system.  The Cleardocs system creates an entirely new contract copying the data from the previous agreement and pasting into a new document – meaning that entering core data such as business name, address, and hours of work and so on only needs to be done once. In order to tailor each contract to a specific employee, the Cleardocs system allows the employer to edit the pasted data.

Our key aim with this development is to save you, as a business owner, time and money.  One of our customers, Ben Norman, has tested our new functionality for us: “With Cleardocs I created one contract of employment exactly as I wanted for my business, and quickly afterwards I had all 15 contracts of employments done. Running a business is difficult enough as it is, at least Cleardocs recognise the need for professional, value for money, technology led solutions – I wish more people did.”  

Let us know if you want to chat with us about how our new copy and paste feature can save you some time and some of your hard earned profit, give us a call on 0845 474 0372.

The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.
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The Equality Bill will come into effect in October 2010

Added: 2010-07-08 15:41:38.0
After many months of uncertainty, and a general election in the middle, the government have finally confirmed that the Equality Bill will be implemented in October.  Although this had been widely expected, the general election and change of government had cast some doubt as to whether the Equality Bill would indeed be put into practice.

The Equality Bill combines 9 current pieces of legislation to create one Act that will simplify the law related to discrimination issues and should thereby make it easier for businesses to comply.  For more on the specifics of the Bill, read our post on the Equality Bill from earlier this year.

The first steps towards the implementation of the Bill will go ahead in October and amongst others, will create the much lauded provisions to protect disabled people from discrimination.

Commenting on the Bill, Theresa May, Home Secretary and minister for women and equalities said “By making the law easier to understand, the Equality Act will help business treat staff fairly and meet the needs of a diverse customer base. The law will be easier to understand and better able to protect people from discrimination.

Implementing the Equality Act to the planned timetable makes clear our commitment to equality. A successful economy needs the full participation of all its citizens and we are committed to implementing the Act in the best way for business.

Along with these legislative measures the GEO will also look at ways of achieving our equality aims without new legislation.”

Although the Bill will most likely make it much easier for businesses to understand the discrimination laws, the government has come in for some criticism based on its tackling of the gender pay gap.  CBI Director of HR Policy, Katja Hall commented that “the Government has missed an opportunity to say it will remove mandatory gender pay reporting from the legislation.

Forcing companies to publish average salary figures for men and women could mislead people into thinking that women are paid less than men in the same role, which is rightly illegal, when differences will actually reflect the proportions of men and women in higher-paid jobs.

The policy is also likely to backfire. Companies that have too few women in higher paid roles, and are trying to attract more, would be forced to publish a statistic that could deter female applicants and compound the problem."

Whilst many may feel that forcing businesses to publish figures on their staff salaries will help battle the gender pay gap, some may share the feelings above and feel that it is in fact counterproductive and will create more problems.

As ever, we’ll keep you posted on any developments and of course, the Cleardocs standard employment contract and staff handbooks will be updated when it comes to the implementation in October.

How do you feel about the Equality Bill?  Do you think it’s a step in the right direction?  How do you feel about the lack of amendment to reporting the salaries of high earners in relation to the gender pay gap? Do you agree with the thoughts above or do you think it will improve things?  Let us know by commenting below.

The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.

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Cost of the new Budget: 1.3 million jobs

Added: 2010-07-05 11:25:00.0
According to Treasury data, leaked last week, the coalition government’s new Budget will result in up to 1.3 million job losses before 2015.  The data, which was picked up by the Guardian, reveals that the government expect to see 100-120,000 public sector jobs and 120-140,000 private sector jobs disappear per year as a result of the new Budget.

Whilst the large public spending cuts and subsequent public sector job cuts may have been expected, numbers this high may come as a shock to most.  It is the levels expected in the private sector that may worry business owners (and especially their employees) the most.  In total, the government forecasts that between 500,000 and 600,000 public sector jobs and between 600,000 and 700,000 private sector jobs will go in the next 5 years.  

According to the Guardian, the losses will be largely due to the biggest reduction on public spending for 65 years.  There is the obvious impact on the public sector of reduced spending; with a targeted 25% inflation-adjusted reduction in spending at Whitehall over the next few years.  The private sector however will suffer through the loss of government contracts and from the knock-on impact of lower consumer spending.

Last week on the Cleardocs blog, we discussed the Budget in terms of its positive effects on small businesses with lower tax rates and lower National Insurance contributions. This new data shows the budget in a different light as no business enjoys having to lose employees.  Business owners will be mindful of this data as they go forward, especially those with government contracts that may well be subject to review.

How do you feel about the Budget a week on?  Are you mindful of the public sector cuts or do you feel that they don’t have any bearing on your business?  Let us know by commenting below.


The content of this blog is not legal advice and should not be relied on as such, or used instead of seeking legal advice.
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