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Employment Matters

CONTENTS 1-2 Pension reform 2-3 Appraisal Regulations and Model Policy – September 2012 3-4 Persistent short-term absenteeism – what can you do about it? 4 News in Brief

HR and Employment News Summer 2012

Pension reform From 1 October 2012 the Government’s pension reforms are due to start taking effect. There are three key elements: u A new requirement on employers to enrol automatically to

“jobholders” in a workplace pension scheme. u Mandatory minimum employer pension contributions. u A prohibition on certain recruitment practices.

Auto-enrolment The new legislation dictates that an employer will be required to enrol automatically an eligible “jobholder” in an automatic

Employers will need to obtain specialist advice on whether a

enrolment pension scheme, unless he/she is already a member

pension scheme that they currently operate, or participate in,

of the employer’s pension scheme, which complies with certain

fulfils the requirements.

requirements. A “jobholder” is defined as an employee or worker who: u works (or ordinarily works) in the UK under a contract; u is aged at least 16 and under 75; and u is paid “qualifying earnings” by their employer.

In order to be eligible a jobholder must: u Be at least 22 and not have reached state pension age; u Be paid earnings that exceed the earnings trigger; and u Not already be an active member of his employer’s qualifying

scheme. A scheme will be an automatic enrolment scheme if it is: u the central personal accounts scheme set up by the Secretary

of State (NEST); or u an alternative existing scheme established by the employer

should be enrolled and how an employee can opt out of the arrangements. Essentially, the onus is on the employee to exercise their right to opt out and an employer cannot encourage this in any way. Large employers will begin auto-enrolment first (1 October 2012). Employers will then be assigned a “staging date” according to their size, which will specify when they must take action. Small businesses will not need to begin enrolling their staff until May 2015.

Mandatory minimum employer contributions for defined contribution schemes One of the key reforms is the requirement for employers to make minimum contributions into their employees’ pension arrangements. This requirement is to be phased in over six years, with employers eventually (by 1 October 2018) being required to make minimum employer contributions of 3%.


that counts as a qualifying scheme.

There are detailed provisions dealing with when employees

Pension reform (continued)


Employment protection measures

A careful analysis by an employer of its employees at this stage

The Government has enacted a range of employment protection

would be extremely sensible.

measures that are designed to safeguard the new rights

u What pension arrangement(s) does the employer currently

bestowed on employees by the legislation. The measures are

offer? An employer will need to address what it currently

intended to prevent employers taking steps to avoid their duties.

offers and whether this scheme complies with the quality

Included in the measures are provisions which state that

requirements set down in the legislation. As part of this process

employers cannot ask applicants prior to recruitment whether they plan to opt out of auto-enrolment, nor can they offer any kind of inducement (financial or otherwise) to individuals who are eligible for auto-enrolment to opt out. This could be in the form of an increase in salary or benefits, or a bonus.

That is all very complicated

an employer could use this opportunity to review the pension benefits offered to staff and consider their suitability long term. For example, many employers are offering membership of the NEST scheme in conjunction with their own occupational pension scheme. u How are employers going to communicate the changes to their

employees? Employers should consider how they are going to

It is correct to say that the measures put in place are not easy to

communicate the changes to their employees and develop a

navigate and it is likely that most employers will not be required

workable method of informing employees of the practicalities

to take any action until at least 2013. However, prudent employers

of the change, i.e. how they can opt out, what contributions

should be considering some of the following at this stage in order

they will be required to make and when.

that they can fully prepare for taking any required steps in the future:

For further information please contact Jean Boyle on –

u Which employees fall within the definition of jobholders?

Appraisal Regulations and Model Policy – September 2012 As those of you running schools in the maintained sector will be

Whilst Academies (subject to the specifics of their funding

aware, you are subject to new Appraisal Regulations with effect

agreements) and indeed, independent schools are not obliged to

from the 1 September 2012.

performance manage against the new Teachers Standards 2012, we

The Regulations require the School to: u adopt an appraisal document; u appoint an external adviser for the purposes of appraising the

Head Teacher; u generally provide for a 12-month appraisal period; u provide that Schools should set standards for assessment

purposes which should include the Teachers Standards 2012; and u provide that the school should issue appraisal reports at the end

of the appraisal period. The Department for Education has also issued a Model Policy which is divided into two parts: part A deals with Appraisals and part B is the Capability Procedure.

are aware that many Academies do intend to apply the Teacher’s Standards for that purpose and indeed adopt the Model Policy. One of the headlines has been that there is no informal element to the Capability Procedure and strictly speaking this is correct. However, the Model Policy clearly anticipates that the appraisal process will be an ongoing and supportive exercise and only if “the appraiser is not satisfied with progress” will the School move a teacher on to the Capability Procedure. Consequently an informal stage is likely to be addressed during the appraisal process. The Capability Procedure includes a time scale such as that if a teacher did not improve, a point of dismissal could be reached within 9 weeks. That is all the more reason why it is important that Schools ensure that they address the appraisal process

“Persistent short-term absenteeism is one area where this situation arises fairly often, and an employer can find itself in a situation where a manager’s patience has run out but the employee is unaware that there is a problem.”

appropriately to minimise the risk of a Tribunal judging that they

Christine Blowers, the General Secretary of the NUT, has written:

had been unreasonable in applying the Capability process leading

“We hope that many Schools and Local Authorities will be keen

to dismissal.

to reject these changes as unfair and unnecessary but where

Some general considerations: u For Maintained Schools it is only the Appraisal Regulations that

you must comply with; the Model Policy is a matter for you to decide whether you wish to introduce. u If you have a contractual Capability policy bear in mind that a

change would amount to a variation and care needs to be taken to effect that; even more so if your School is an Academy. u The Model Policy does not address ill health lack of capability. u With regard to the removal of the 3-hour classroom observation,

there is a threat that they will be adopted, the NUT will support you and will use the threat of, and will ballot for, industrial action when necessary. We will be co-ordinating action across and between schools and Local Authorities.” u The most important thing is to ensure that you take your staff

“with you”: explaining the reasoning behind, for example, adopting the Model Policy; and explaining in the event you do, that effectively there is an informal process within your appraisal process (consider whether you should introduce a Protocol e.g. on classroom observation).

beware of the risk of allegations of being bullied/harassed by

u If your School is an Academy, it is unlikely that you would wish

over monitoring. Consider adopting a Protocol which is not overly

to include the wording in the Model Policy “before the decision


to dismiss is made, the School will discuss the matter with the

u Beware of the possibility of a grievance being raised during the

process and if so consider whether it can be dealt with as part of the process if it is linked. u Consider also the possibility of someone going off sick e.g.

with stress, during the process and the need to refer them to occupational health, better still a specialist consultant in the area of ill health concerned. u Consider union reaction. Note in particular, the NUT website.

Local Authority”. u If you are in the process of converting to Academy status, and

you envisage that you will adopt the Model Policy, that almost certainly amounts to a “measure” so you should both inform and consult upon the proposal to adopt the Model Policy as part of your TUPE process. For further information of any of the issues raised above, please contact Nick Watson on

Persistent short-term absenteeism – what can you do about it? An employee’s (lack of ) capability is a potentially fair reason for

line. Allowing concerns about performance, or about attendance,

their dismissal. Dismissals for lack of capability encompass a very

to linger often ends up with managers becoming frustrated and

wide range of scenarios – from an individual’s poor performance

wanting to dismiss someone in too short a space of time to be

whilst at work, through to their complete lack of performance

a fair dismissal. Persistent short-term absenteeism is one area

due to long term absence from work. Nevertheless, capability

where this situation arises fairly often, and an employer can find

dismissals tend to be seen as being ‘harder’ than misconduct

itself in a situation where a manager’s patience has run out but

dismissals possibly due to the inherent personal criticism which

the employee is unaware that there is a problem.

such actions inevitably appear to convey.

What can an organisation do in these situations? The first step

Not addressing capability issues as they arise though for fear

is to check your policies and then follow them as they apply to

of an unpleasant situation developing almost always leads to a

someone whose absence rate is unacceptably high. If you do

more difficult, and more unpleasant problem, further down the

not have a relevant policy, consider what is needed within your

organisation and consider adopting a policy which meets your

reference to their particular circumstances. It is important to set

needs. For someone whose absence rate is unacceptable, look

targets which are both achievable and measurable, and be even

for any underlying reasons, and consider what you can do to

handed in the application of the policy across the whole workforce

assist them with improving their attendance. Those reasons

– there can be a temptation to move too quickly with those staff

may lie outside of your business, so be careful that you do

whose absence has not been properly managed in the past and

not inadvertently discriminate against employees with caring

with whom there is more frustration as against those who are

responsibilities for children, dependent adults, or disabled people.

only just beginning to have unacceptably high levels of absence.

Consider analysing the impact which short-term absence has on

Persistent short-term absenteeism can be a significant

your business, and identify ‘trigger’ points at which employees

problem for many organisations, but careful and even-handed

have their absence more closely monitored under a suitable

management of it can produce results which benefit all parties

capability / absence management policy. Carry out full return


to work interviews and discuss with employees who trigger the policy what an acceptable absence rate is both generally and by

For further information please contact Tamsin Wilkinson on

News in Brief Tamsin Wilkinson move to Cambridge office We are delighted to announce that Tamsin

clients in the East of England as well as the HR support which is

Wilkinson has been promoted to an Associate

already provided through the Cambridge office. Tamsin will be

and will moving to our Cambridge office with

focusing her efforts on providing on-the-ground support, so if you

effect from Monday 18th June. Tamsin’s move

would like to arrange a time for Tamsin to visit your premises to

to Cambridge will ensure that we are able to

discuss the services we can offer, please do contact her on 01223

provide local, high quality, legal services to our

451 342 or by email at

Your Contacts Nick Watson Partner


Peter Woodhouse Partner email:

Stone King LLP 13 Queen Square Bath BA1 2HJ Tel. 01225 337599 Fax. 01225 335437 16 St John’s Lane London EC1M 4BS Tel. 020 7796 1007 Fax. 020 7796 1017 Wellington House East Road Cambridge CB1 1BH Tel. 01223 451070 Fax. 01223 451100 New Hall Market Place Melksham Wiltshire SN12 6EX Tel. 01225 337599 Fax. 01225 335437 email:

© Stone King LLP 2012


Employment Matters deals with some current legal topics. It should not be used as an alternative to specific legal advice on the individual circumstances of a particular problem. Stone King LLP – registered limited liability partnership no OC315280, registered office 13 Queen Square, Bath BA1 2HJ