Forum of Private Business: Employment Essentials

5 Essentials

every employer should know Stay up to date, know your obligations, save money and get the best out of employees

MGEE001 AUG2016

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5 Essentials every employer should know Did you know?

1 in 6 employment disputes end up at tribunal and the average tribunal costs businesses £9,000 to defend. For the average employment tribunal. Plus, when you factor in solicitors’ fees and the time you have to take out of your business, the costs are nearer £20,000*!

Most of the time businesses don’t break the law knowingly, so staying up to date with legislation, getting the right advice and making good employment decisions is key.

That’s why we’ve put together this quick guide to help you understand your obligations in five steps.

Your employment law responsibilities 1

Employees have basic rights that you must observe. Failure to do so can result in a tribunal.

Even if you only use freelancers or contractors they may legally be classed as employees and have the following rights:

Pay and hours • To be paid at least the National Minimum Wage/Living Wage and equally to members of the opposite sex doing similar work of equal value.

• Rest breaks and paid holiday in line with Working Time Regulations.

• Statutory sick pay and redundancy pay.

• Protection from unauthorised deductions in pay.

• Maternity, paternity and adoption leave and pay, paid leave for antenatal care, unpaid dependants’ leave, unpaid parental leave (after one year) and the right to request flexible working.

“I only employ people I know and like, I won’t ever have any problems with them”

• Time off for public duties, including jury service.

* Forum of Private Business Referendum 204, Cost of Compliance

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Discrimination • Not to be discriminated against unlawfully on grounds of race, sex, marriage, pregnancy, disability, gender reassingment, sexual orientation, age, religion or belief. Protection against less favourable treatment for part-time workers, those that ‘whistle-blow’ and Trade Union members.

Disciplinary and dismissal • The right not to be unfairly dismissed, after a qualifying period of two years.

• Access to a fair grievance, disciplinary and dismissal procedures, and the right to be accompanied at a disciplinary or grievance procedure hearing.

Did you know?

All employees have the right to written statement terms and conditions of employment (e.g. a contract) within two months of starting.

Misunderstandings caused by lack of terms is one of the main causes of employment tribunal claims*. Call the Forum’s member helpline on 01565 626001 to find out how we can help you ensure your contracts are correct.

Please note: Rights differ for agency workers, apprentices and employee shareholders.

Your health & safety responsibilities 2

Health and safety requirements change depending on the level of risk involved in your business, but as a minimum you should: • Appoint a competent person to manage health and safety.

• If you have five or more employees, you must have a written health and safety policy.

• Carry out and document a risk assessment of your premises to identify any hazards.

• Consult employees by talking to them about risks and involving them in decisions.

• Provide training and information so that all employees know how to mitigate risks and respond in the event of an accident.

• Provide a workplace with facilities suitable for their health, safety and welfare.

• Have first-aid arrangements in your workplace, and a means of recording certain injuries, incidents and cases of work-related disease. * ACAS, 2013

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• Display the health and safety law poster.

• Have employers’ liability insurance.

• Regularly make sure your policies and assessments are up to date with changes to legislation.

Did you know?

Failure to comply with health and safety legislation can lead to an investigation and fines averaging £37,938*. Spot checks can also occur in high risk industries. To find out how we can help you protect your business call the Forum’s member helpline on 01565 626001.

Your tax & finance responsibilities 3

• Employers are responsible for making national insurance contributions and deducting employee contributions from their pay to send to HMRC. • Employees are entitled to an itemised pay statement detailing any deductions.

• All expense allowances and reimbursements, as well as benefits in kind provided to employees, need to be shown on individual P11D forms, completed annually and submitted to HMRC. • Employers must issue employees with a P60 every year.

• From April 2012, employers must report details of each payment of earnings on or before the time it is paid (known as Real Time Information or RTI).

Did you know?

By 2017 all employers will have to automatically enrol employees in a qualifying pension scheme and make at least 1% contribution, rising to 3% by 2018. To find out how the Forum can help you plan for these changes, call the Forum’s member helpline on 01565 626001.

*HSE 2014/15

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Recruiting the right employees 4

Making good recruitment decisions can help you find employees with the right skills who will fit in with the rest of your team, and prevent disputes in the future.

• Write an accurate job specification for the role you’re recruiting for, be realistic about what is essential and what is desirable.

• Identify an individual person specification for each role and include ‘soft skills’ like communication and working as part of a team.

• Do not change your mind about what you’re looking for in a candidate during the interview process.

• Work to a standard interview process on all applicants, include if you wish a mix of telephone screening, psychometric tests, interview and skills based tests.

• Ask all applicants to complete a standard application form and provide copies of all qualifications and ID so you can check their right to work in the UK. • During each interview, ask plenty of competency based questions around what they’ve achieved in their career to date.

• Before appointment, take a minimum of two acceptable written references on which the job offer will depend.

• Once a job has been offered, plan a thorough training and induction schedule for them to give them the best start in your business.

Did you know?

The average cost of recruiting the wrong person is £8,200, so it pays to take advice and get it right.* For more advice and support, call the Forum’s memeber helpine on 01565 626001.

*CIPD 2007

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Stay up to date with legislation 5

Did you know that business laws change at least twice a year? Recent changes include:

April 2016 • From 1st April 2016, the government introduced a new mandatory national living wage for workers 25 and above, initially set at £7.20.

• National minimum wage rises to £6.70/hour for over 21s, £5.30 for 18-20 year olds, £3.87 for 16-17 year olds and £3.30 for apprentices.

• Unfair dismissal compensatory award capped at 12 months salary or £78,962, whichever is the lower, on awards given in successful unfair dismissal cases.

July 2013 • New employment tribunal rules introduced a charge of £160-£250 for employees to lodge a claim and up to £950 if it’s accepted.

• Settlement agreements introduced to allow employers and employees reach a financial settlement that benefits both parties outside of a dispute situation.

September 2013 • Under employee shareholder status rules, jobs can be offered on the basis that the worker forfeits some employment rights in return for shares worth a minimum value of £2,000.

October 2013 • Employers will no longer be liable for harassment of employees by third parties such as customers or suppliers.

• Reporting of accidents at work will be simplified and strict liability for injuries at work removed hopefully reducing the burden on SMEs. Our online law guides are updated whenever the law changes and members get quarterly email updates to ensure they are always kept up to date.

“The Forum helped me with advice on property and employment issues.

If I’d had to pay for lawyers, it would have cost me thousands” Rudy Porter, Slick Willies

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Peace of mind that your business is protected The Forum of Private Business specialises in providing affordable employment law and Health & Safety help and advice.

Accidents, prosecutions, or other adverse health and safety events may never happen to you, but if they do, the effect on your business and its ability to grow could be catastrophic. Membership of the Forum can also help you protect your business from such risks.

Membership includes: • An unlimited helpline offering practical guidance on employment law, health and safety, marketing and business development • Protection for your business with our legal expense insurance, worth up to £50,000 per section of cover • Tailored advice and member services to save money, make money and help your business grow • Getting your views on pressing business issues heard by policy makers • The Health and Safety Guide - including customisable forms and templates • Access to a health and safety consultant partner to provide specific, tailored support if required By leading you through new and ever evolving legislation we leave you free to concentrate on what you do best, running your business.

With memberships starting from only £14.50 per month it’s the best decision you can make for your business today!

Call 01565 626001 or visit fpb.org To keep in touch with the Forum, and stay up to date with the latest business advice, opinion and news, follow us at:

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Our expertise is your expertise For more information on how we can help your business with simply contact our helpline team on 01565 626001, visit our website www.fpb.org or email us marketing@fpb.org

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