Queen’s Speech 2022: What next for UK Employment Law?

The Queen’s Speech at the State Opening of Parliament sets out the UK government’s legislative agenda for the year ahead. This year’s speech took place on 10 May, and in addition to the Queen’s absence, there was notable absence of any employment law reform.

In particular, the long-awaited Employment Bill, which was included in the Queen’s Speech in December 2019, was not one of the new Bills announced. Its omission was not unexpected, having been excluded from the legislative agenda during 2020 and 2021 too, but it is perhaps now even clearer that employment law is not a priority for the current government.

When first announced, the Employment Bill was expected to contain a plethora of new or enhanced rights including: carer’s leave; neonatal pay and leave; enhanced redundancy protection during pregnancy and maternity; an ability to retain tips; making flexible working the default; and increased contract predictability for workers. It was also expected to legislate to create a new single enforcement body. 

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Covid-19 related refusal to attend the workplace

Covid-19 related reluctance or refusal to attend the workplace is nothing new, but as we enter a new phase of the pandemic, ‘Living with Covid’, developing case law will be of interest to employers who require or expect workers to attend the workplace on a full or hybrid basis. This blog considers the current guidance on workplace attendance, the recent Employment Appeal Tribunal’s (EAT) decision in Rodgers v Leeds Laser Cutting (a case looking at whether an employee had protection against unfair dismissal when refusing to attend work due to Covid related concerns), and some practical considerations for employers.

The UK government’s ‘Living with Covid’ plan came to full fruition in England on 1 April 2022, with remaining Covid-specific guidance now largely obsolete, and replaced with general public health guidance. This essentially treats Covid like other respiratory illnesses for individuals and business to manage, leaving employers with discretion on how to manage ongoing Covid risks in the workplace, and individuals encouraged to exercise personal responsibility. 

Employers are no longer required to consider Covid specifically in their risk assessments, nor have specific Covid mitigation measures in place, although they must continue to comply with their general health and safety obligations. Similarly, ‘work from home if you can’ guidance has been removed, although individuals with symptoms of a respiratory infection (including Covid), and who have a high temperature or do not feel well enough to work, or anyone with a positive Covid test, are advised to try and stay at home, working from home if possible, and to avoid others. Individuals who cannot work from home are advised to discuss options with their employer. 

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Florida expands definition of “discrimination” and increases employer liability for discrimination in workplace diversity training

Florida Governor Ron DeSantis signed a bill into law that prohibits employers from implementing discriminatory practices in their diversity training programs, effective July 1, 2022. The bill, known as the “Individual Freedom Act,” amends the Florida Civil Rights Act, Fla. St. 760.01, et seq., to expand the definition of discrimination and subjects employers to liability for violations.

Expanding the definition of “discrimination”

Specifically, the Individual Freedom Act amends Fla. St. § 760.10, to prohibit public employers and private employers with 15 or more employees from requiring any individual – as a condition of employment, membership, certification, licensing, credentialing, or passing an examination – to participate in training, instruction, or any other required activity that espouses, promotes, advances, inculcates, or compels the individual to believe any of the following concepts:

  1. Members of one race, color, sex, or national origin are morally superior to members of another race, color, sex, or national origin.
  2. An individual, by virtue of his or her race, color, sex, or national origin, is inherently racist, sexist, or oppressive, whether consciously or unconsciously.
  3. An individual’s moral character or status as either privileged or oppressed is necessarily determined by his or her race, color, sex, or national origin.
  4. Members of one race, color, sex, or national origin cannot and should not attempt to treat others without respect to race, color, sex, or national origin.
  5. An individual, by virtue of his or her race, color, sex, or national origin, bears responsibility for, or should be discriminated against or receive adverse treatment because of, actions committed in the past by other members of the same race, color, sex, or national origin.
  6. An individual, by virtue of his or her race, color, sex, or national origin, should be discriminated against or receive adverse treatment to achieve diversity, equity, or inclusion.
  7. An individual should feel discomfort, guilt, anguish, or any other form of psychological distress on account of his or her race, color, sex, or national origin.
  8. Such virtues as merit, excellence, hard work, fairness, neutrality, objectivity, and racial colorblindness are racist or sexist, or were created by members of a particular race, color, sex, or national origin to oppress members of another race, color, sex, or national origin.

However, these concepts may be included in training or instruction if they are addressed in an objective manner and without endorsement.

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Pennsylvania on the path to increase threshold for tipped employees

In November 2021, Governor Tom Wolf’s administration proposed a new regulation that will require tipped employees to earn at least $135 a month in tips before an employer is permitted to pay the $2.83 per hour tipped rate, rather than state’s minimum wage of $7.25 an hour. Currently, in Pennsylvania, employers can pay tipped employees less than the state minimum wage if they make at least $30 a month in tips. However, it is likely this will soon change.

On March 21, 2022, Pennsylvania’s Independent Regulatory Review Commission (IRRC) approved the regulation and explained that this new threshold is necessary to reflect the changes of inflation over the past four decades when the $30 tip threshold went into effect in 1977, which was described as “woefully outdated.” Additionally, the regulation also redefines how Pennsylvania classifies who is a tipped employee. Following federal guidance, a tipped employee will be an employee who spends 80% of their time on tipped work and who is paid below the $7.25 minimum wage amount.

Following approval by the IRRC, the regulation will be submitted to the Pennsylvania Attorney General for legal review. If the attorney general approves, Pennsylvania residents will see the regulation take effect 90 days after being posted in the Pennsylvania Bulletin.

Ferry workers’ pay is still at sea

Despite resolving to close an exploited loophole on ferry worker pay, the government has stopped short of an amendment to UK national minimum wage legislation.

In October 2020, legislative changes extended the minimum wage to most seafarers working on ships in UK waters, regardless of where a ship was registered, but those working on ferries (other than between UK ports) were not included, leaving scope for operators to hire crew on international routes on hourly rates below the UK minimums. In the absence of reasonable minimum wages, ferry operators can gain a competitive advantage by driving down wage levels.

Recent events have drawn attention to this practice, and in an announcement this week, the Transport Secretary set out the government’s plan to address some of the pay issues in response to this.

While recognising that a minimum floor is needed to prevent the competitive driving down of wages, and to ensure appropriate and fair levels of pay for ferry workers, the reality of pay arrangements across international borders is not straightforward. Continue Reading

Fire & rehire clampdown: will a new Statutory Code of Practice help?

The practice of ‘fire and rehire’ (i.e. dismissal of an employee and offering re-engagement on new, usually lesser, terms) as a way to facilitate a change to terms and conditions of employment has been under the spotlight in recent years. It is not a new strategy as a way of making changes to employment contracts, nor is it unlawful if handled properly, but the tactic has been subject to increased scrutiny in recent years as cases of misuse by some employers have hit the headlines.

In autumn 2021, legislation curbing dismissal and re-engagement was shelved by the government and replaced with a commitment for updated and more detailed Acas guidance. That guidance (which is not binding) focusses on the importance of thorough and constructive consultation with staff to explore all alternative options to terminating employment, describing fire and rehire as ‘a last resort’.

Fast forward a few months, and the government has announced that we can now also expect a new Statutory Code of Practice on fire and rehire intended to crackdown on the inappropriate use of the tactic, with increased punitive financial sanctions for non-compliance.

As always, the devil will be in the detail. The new Code is expected to set out the consultation process to be followed where there are proposed changes to terms and conditions, and to give practical steps for employers to follow. It is also expected that an additional 25% penalty (on top of the existing punitive sanctions) will be levied where an employer deploys fire and rehire tactics without first having made reasonable efforts to reach agreement through consultation, or where there is otherwise unreasonable non-compliance with the Code. Continue Reading

The Ramadan Roundup

It is that time of the year again – a time of fasting, reflection, prayer and community for Muslims all around the world.

In the Middle East, fasting Muslim employees have the added benefit of being able to observe the Holy Month of Ramadan in an environment where their needs are met not just from a social perspective, but also from a legal one by way of reduced working hours.

In the United Arab Emirates, there are three jurisdictions’ laws to take into consideration when assessing how Ramadan would affect your employees’, fasting and non-fasting working environment and we will discuss these here:

Onshore:

Historically, all employees, whether they were fasting or not fasting, Muslim or Non-Muslim, were entitled to reduced working hours during Ramadan (colloquially referred to as “Ramadan Hours”).

There was a bit of uncertainty in the market about how Ramadan Hours would work this year considering the New Labour Law[1] effectively left the position unclear by stating that the working hours during Ramadan will be determined by the Executive Regulations[2]. Speculation was rife and in particular it was expected that Ramadan Hours will only be available to fasting Muslim employees (similar to the DIFC and ADGM).

However, the Executive Regulations, once it was promulgated, provides that regular working hours shall be reduced by two hours per day and does not differentiate between fasting and non-fasting employees.

Therefore, employers outside of the DIFC and ADGM are obliged to comply with the law by giving their employees two hours less per day. Continue Reading

Virginia officially revoked COVID-19 workplace safety standard

On Wednesday, March 23, 2022, official revocation of Virginia’s COVID-19 permanent workplace safety standard became effective upon publication in the Richmond Times-Dispatch. That action followed a vote by the Virginia Department of Labor and Industry’s (DOLI’s) Safety and Health Codes Board (Board) earlier this week.

The Board initiated steps in February to end the standard based on its finding that emerging scientific and medical evidence showed that the current variants of the COVID-19 virus no longer constitute a “grave danger” to employees in the workplace. The Board allowed a 30-day public comment period before voting this week to formally revoke the standard.

The Virginia Occupational Safety and Health Program (VOSH) continues to have workplace safety enforcement authority under its General Duty Clause as informed by applicable federal and state public health guidance. Additionally, DOLI has announced draft Guidance for Employers to Mitigate the Risk of COVID-19 to Workers, which outlines general health and safety measures that it expects employers to follow, including:

  • Facilitating employees getting vaccinated and boosted;
  • Encouraging any workers with COVID-19 symptoms to stay home from work and seek advice on testing and treatment from their physician;
  • Requiring all workers infected with COVID-19 virus to stay home;
  • Providing workers with face coverings or surgical masks, as appropriate;
  • Encouraging good sanitary work habits such as frequent hand washing;
  • Educating workers on workplace COVID-19 policies and procedures using accessible formats and in languages they understand;
  • Operating and maintaining ventilation systems in accordance to manufacturers specifications to achieve optimal performance; and
  • Recording and reporting COVID-19 infections and deaths when required by federal OSHA regulations.

DOLI has announced a public comment period from March 28, 2022 until April 27, 2022 on the draft guidance, but encourages employers to rely on the draft guidance starting now.

If you have any questions on these developments, need assistance developing policies and procedures to adjust for such changes, or have other questions regarding your workforce related to COVID-19, please contact Betty Graumlich at bgraumlich@reedsmith.com, Noah Oberlander at noberlander@reedsmith.com, or the Reed Smith lawyer with whom you normally work.

Workplace redundancies – what is lawful?

It is hard to avoid the media furore following the events at P&O Ferries last week, where approximately 800 staff were reportedly dismissed for redundancy, without notice and without prior consultation, before being replaced with cheaper staff. Leaving aside the specifics and merits of P&O’s actions (which are complicated by international and seafaring considerations), the broader circumstances have prompted discussion about employee rights in a redundancy situation, and what is lawful conduct by employers. This blog provides an overview of the law on redundancy in England and Wales, and provides guidance on best practice:

  1. A redundancy situation arises, broadly, in one of three situations: a business closure; a workplace closure; or where there is a reduced requirement for employees to carry out particular work. If the business and workplace still exist, and the need for personnel has not diminished, it will be hard to establish that there is a genuine redundancy situation.
  2. Redundancy is still a dismissal, and usual unfair dismissal principles apply. In the absence of a genuine redundancy situation and/or a fair procedure, the dismissal is likely to be unfair, and eligible employees may seek recourse in the employment tribunal. Compensation for an unfair dismissal is the lower of 52 weeks’ pay or the statutory maximum (currently £89,493, rising to £93,878 on 6 April 2022), at the date of dismissal.
  3. Where an employer proposes to dismiss 20 or more employees at the same establishment in a 90 day period, there is an obligation to consult with representatives of affected staff. The minimum consultation period is 30 days where 20-99 redundancies are proposed, and 45 days where 100 or more are, meaning the first dismissal should not take place before this period has passed. Prescribed information must be provided to the representatives, and consultation with them should be meaningful, with a view to reaching agreement on ways to avoid or reduce dismissals or mitigate their impact, and on the way in which the redundancy process will be carried out. A failure to comply with these collective consultation requirements can result in claims for a ‘protective award’ of up to 90 days’ gross pay per employee.
  4. Employers proposing 20 or more redundancies are also required to notify the Secretary of State for BEIS (Business, Energy and Industrial Strategy) on form HR1 of their plans at least 30 or 45 days (depending on the numbers affected) before the first dismissal takes effect. A failure to do so is a criminal offence, with exposure to an unlimited fine.
  5. In addition to any collective consultation requirements, individual consultation should take place with any employees selected for redundancy in order to discuss their particular circumstances.
  6. A fair redundancy process should consider whether there is any suitable alternative employment for potentially redundant employees. It is also important to remember that certain employees (e.g. those on maternity, adoption or shared parental leave) are afforded special protection in respect of alternative vacancies.
  7. Although there is no legal requirement to offer an appeal against a redundancy dismissal, a failure to do so may affect the overall fairness of the decision. Whether to offer an appeal should therefore be considered when considering the redundancy process to be followed.
  8. Redundant employees are (subject to eligibility criteria) entitled to at least a statutory redundancy payment, calculated by reference to their age, length of service, and pay. They are also entitled to their contractual notice and any accrued benefits to the termination date.
  9. Settlement agreements are a valid way for employers to mitigate the consequences of any legal or procedural shortcomings in their redundancy exercise. A settlement agreement has the effect of employees waiving their employment rights in return for a financial payment. However, it is not possible to compromise a claim for a failure to collectively consult in this way.
  10. Employers should not underestimate the reputational damage arising from a badly handled redundancy exercise. A mishandled redundancy programme from a legal perspective, poor communication with affected employees, and/or poor treatment of affected employees, can have detrimental consequences for the organisation’s brand and reputation as an employer. Careful planning, legal advice and a clear communications strategy will help to alleviate this risk.

New York enacts two bills expanding employee protections under the state’s anti-discrimination statute

As we previously reported, the New York State Senate recently passed a handful of significant employment-related bills. On March 16, Governor Kathy Hochul signed several of the bills into law.

Perhaps most notably, Senate Bill S.5870 bars employers from disclosing an employee’s personnel files because the of the employee’s participation in a workplace complaint or proceeding, unless such disclosure is otherwise required or permitted by law. The law allows the Attorney General to commence an action or proceeding if, upon information or belief, the Attorney General is of the opinion that an employer has been, is, or is about to retaliate against an employee. Previously, the only enforcement mechanism was a private right of action. This amendment is effective immediately.

In addition, Senate Bill S.812A requires the New York State Division of Human Rights (NYSDHR) to establish a toll-free confidential hotline to provide counsel and assistance to individuals with complaints of workplace sexual harassment. The NYSDHR will also recruit attorneys to provide pro bono assistance to individuals that call the hotline. Under this new law, employers will be required to provide information on the hotline in any materials posted or provided to employees regarding sexual harassment. This new measure goes into effect in July 2022.

New York employers should immediately review their retaliation and personnel file policies to ensure compliance with S.5870, as well as train Human Resources and supervisors on the new law. As July approaches, employers should also ensure that their sexual harassment materials reflect the confidential hotline, for which we anticipate supplemental guidance will be issued.

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