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Employment Legislation Update
Added: 2009-05-08 11:50:52.0There’s been a few developments in employment legislation in the past month:
Equality Bill
The long-awaited Equality Bill has now been published. The Bill is intended to combine all of the existing legislation on discrimination into one single statute.
Although the Bill will no doubt be subject to considerable debate and amendment before coming into force, some of the main points to note are that it:
- allows positive discrimination during recruitment in favour of disadvantaged groups when faced with candidates who are otherwise equally qualified
- reverses the case Malcolm v London Borough of Lewisham, and abolishes the list of areas in which a disability must impact (eg mobility, manual dexterity, memory or ability to learn, concentrate or understand etc.)
- contains a clause allowing the Secretary of State to order employers with more than 250 employees to publish information about disparities in pay between male and female employees (although it may be that this power will not be used for a further four years)
- outlaws any clauses in employment contracts which impose a secrecy obligation stopping employees discussing their pay package
- introduces a new duty for some key public bodies to pay due regard to socio-economic disadvantage in making strategic decisions
- extends public sector duties to ensure equality to age discrimination
- gives effect to recent European caselaw by outlawing discrimination by association
Register of Judgments, Orders and Fines (Amendment) Regulations 2009
From 1 April 2009, employers or individuals who do not pay employment tribunal awards will be "named and shamed". The defaulters will be added to the Register of Judgments, Orders and Fines if enforcement proceedings are brought against them in a county court.
Members of the public and credit reference agencies will be able to check the register, which the Government hopes will provide an incentive for timely payment, and give weight to tribunal rulings.
National Minimum Wage updated rates — and increased enforcement and penalties
The Employment Act 2008 has introduced new penalties for the underpayment of the National Minimum Wage (NMW) by employers, in the same month as the NMW reaches its 10th anniversary.
New rates
The NMW:
- for workers over 22 years old is £5.73 (a 59% rise since its introduction in 1999, when it was £3.60)
- for 18 – 21 year olds, is £4.77
- for 16 and 17 year olds, is £3.53.
These NMW rates will increase again in October 2009.
Penalties for underpaying employers
On 6th April 2009, the enforcement procedures for NMW were overhauled. From that date, employers face a penalty if HM Revenue & Customs (HMRC) discover they have failed to pay the NMW — workers will be entitled to have arrears of wages repaid at current rates.
The Act also:
- gives HMRC compliance officers new inspection powers and
- strengthens the criminal regime for national minimum wage offences.
If an HMRC investigation reveals underpayment, then the HMRC may require the employer:
- to repay arrears to the workers; and
- to pay a penalty to the Secretary of State.
The penalty is 50% of the total underpayment — with a minimum of £100 and a maximum of £5,000. However, if a penalised employer complies fully with the notice of underpayment within 14 days of service will receive a discount of 50% on the penalty.
Know the rates
The new penalties make it more important than ever for employers:
- to be familiar with the current wage rates for their employees
- to keep proper records of the wages they pay to their workers and the permitted deductions.
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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