February « 2018 « 121HR Solutions – Glasgow

February, 2018

Top Shop sale worries pensioners

Sir Philip Green’s plans to sell his stake in Arcadia group – which owns high street brands including TopShop, Dorothy Perkins and Miss Selfridge – has been criticised by regulators for failing to address worker pensions. Last year, it was found that Arcadia’s pension deficit stood at £56million on an ongoing basis – or almost £1billion on a buyout basis.

The company has 2,800 stores around the world and 26,000 employees.
Sir Philip has been in talks to sell his stake in Arcadia – which is estimated to be worth in the region of £2billion – to Chinese investor Shandong Ruyi.
This has resulted in calls on the Government to enable the Pensions Regulator to ‘pause’ the sale until the issues of the pensions have been sorted out.
Last year, Arcadia wrote off £100million due to declining store values and falling sales.

  • Posted on February 28th, 2018

When a contractor is an employee

A former BBC presenter caught by the IR35 tax rules has lost her employment status appeal against HRMC and been ordered to pay more than £400k in unpaid tax after the High Court found that she was an employee, not a contractor.

In the case the court ruled that the presenter must pay backdated income tax and national insurance contributions (NICs) amounting to £419,151 for tax years 2006-07 to 2012-13. The case could have financial implications for other contractors and freelancers caught in the IR35 net, as well as for the employers they work for – in terms of who they can employ and on what basis.

The judge in the case said that whether the BBC regarded the contractor as an employee was not relevant and found that she “was an employee under the hypothetical contract”.

The BBC ultimately restricted her from providing services to other organisations in the UK without its consent; she was also contractually obliged to perform services, and the BBC was contractually obliged to pay monthly fees to her.

  • Posted on February 22nd, 2018

National Minimum Wage increases

The National Minimum Wage (Amendment) Regulations 2018 provide for the annual increase to the minimum wage and national living wage with effect from 1 April 2018 as follows:-

• 25+ – £7.83 (previously £7.50)
• 21-24 – £7.38 (previously £7.05)
• 18-20 – £5.90 (previously £5.60)
• <18 – £4.20 (previously £4.05)

  • Posted on February 22nd, 2018

Pay rises for the UK in 2018

British workers are set to receive their biggest pay rises since 2008 this year. According to a Bank of England survey, the increases are a result of the higher minimum wage, inflation and reluctance from European workers to work in Britain.

Britain’s minimum wage for those aged 25 and over is due to rise by 4.4% in April to £7.83 an hour, while pay for some younger workers will rise by over five per cent.
The survey also found that firms plan to offer average pay settlements of 3.1% – the highest since 2008, and an increase on the 2.6% last year. However, inflation is also a cause for concern, as businesses also reported cost pressures from higher mandatory pension contributions, a lack of foreign workers and difficulty recruiting and retaining staff according to Reuters.

Inflation hit its highest in over five years in late 2017, following the Brexit vote, which has impacted the cost of imports. Last week the Bank of England forecasted that annual pay growth would reach 3% by the end of 2018 – up from 2.5% in the year to November 2017.

  • Posted on February 22nd, 2018

Government announces measures to prevent sexual harassment at work

The Government has called on organisations and individuals in the UK to submit evidence on sexual harassment against women at work, as it launched a full inquiry to track its extent and determine how to improve existing laws.

Experts have proposed extending time limits for sexual harassment employment tribunal claims, reinstating employer tribunal questionnaires, reducing legal costs and bolstering sanctions for non-compliance with harassment laws. The inquiry will also examine the effectiveness of current legal routes to redress for female workers who suffer sexual harassment, including improved access to tribunals and options for remedies.

In measures designed to safeguard against sexual harassment, the introduction of mandatory workplace risk assessments and line manager training to change work cultures and encourage the reporting of harassment, alongside third-party liability for employers, were all suggested.

The public can submit their views on women’s experience of sexual harassment at work and proposals for effective government action for one month until Tuesday 13 March.

Currently, employers are not liable for third-party harassment of employees – after the government repealed in 2013 a legal provision to that effect in the Equality Act 2010. As part of addressing the legal action around sexual harassment, the committee will also scrutinise the pros and cons of using non-disclosure agreements (NDAs) in sexual harassment cases.

  • Posted on February 20th, 2018

Tesco’s £4bn headache

Equal pay claims at the UK’s biggest retailers could start to pile up after it has emerged that Tesco is facing a potential bill of up to £4 billion in back pay for thousands of employees.

Nearly 100 shop assistants and cashiers who are mostly women are seeking to be paid the same as their colleagues in Tesco’s warehouses, predominantly men, in what could be the largest ever equal pay claim in Britain.
Up to 200,000 shop floor staff could be affected if the claim ends up at the Employment Tribunal and the company may be forced to pay out as much as £20,000 in back pay over the past six years to some employees if the claims are successful.

  • Posted on February 15th, 2018

More rights for zero hours’ workers

Business secretary Greg Clark has pledged to support the rights of thousands of so called “gig workers” by bringing in new rules on holiday and sick pay. The Government reforms follow a review into working practices by on-demand firms such as Deliveroo and Uber which use flexible workers on casual contracts. Under the proposals workers will also have the right to a payslip and firms which mistreat staff will face higher fines.

Ministers are also asking the Low Pay Commission to consider a higher minimum wage for workers on zero hours contracts. If the proposals go ahead, this will be the biggest change to employment law for years.

  • Posted on February 15th, 2018

Are self employed workers struggling financially?

The self-employment labour market has grown exponentially in the last five years but, according to the Office for National Statistics (ONS), it remains financially insecure for its workers.

The number of self-employed people in the UK labour market between 2001 and 2016 increased from 3.3 million (12% of the labour force) in 2001 to 4.8 million (more than 15%) in 2016, contributing around one-third of total employment growth in this period.

However, self-employment remains a financially insecure profession, with self-employed workers earning an average distributed income of around £240 a week – compared to an average of £400 a week for full-time employees.

Self-employed workers were also more likely to supplement their employment income from elsewhere. However, as uncertainty over Brexit has given rise to a growing number of short-term contracts in the labour market, the move of highly skilled workers into self-employment could reflect a lack of opportunity in the full-time labour market.

  • Posted on February 14th, 2018

How much pensions’ awareness do you have?

A combination of a lack of financial education and poor access to pensions information may leave employees seriously unprepared for retirement, according to a new survey.

The research found that 10% of 18 to 24-year-old employees did not know what a pension was or how it worked, and female employees were less aware of employer pensions than their male counterparts.

The survey included more than 2,000 adults and almost 80% of the female respondents, admitted to being unaware of their pension’s value. A quarter of those aged 55 and over who work, do not understand how a pension works. The survey also revealed a gap in financial understanding and expectations of retirement earnings. Almost half of workers who hoped to retire believed their standard of living would drop in retirement. More than a third of workers, however, felt it would remain the same on retirement, and 39% of 18 to 24-year-olds specifically believed there would be no decrease in living standards when they retired.

More than half of employees with a pension were unaware of the amount they paid into it, and around a third said they had never checked their pension status. More than half of all employees surveyed said they would like to retire in their 60s, whereas 40% said they thought they would actually retire at that point.

The government announced in December 2017 that by the mid-2020s, employees aged 18 or over would be able to save into a workplace pension, rather than the current age of 22, aiming to bring another 900,000 people into a pension scheme.

  • Posted on February 14th, 2018

On Valentine’s Day, we consider the effect of office relationships on organisations

Employers are likely to fear becoming liable when something goes wrong and some UK companies report that they have banned inter-office romances completely however, this may prove impossible to enforce.

Apparently 40% of workers have dated a colleague at some point, showing that this area is not so much about banning office romances but properly managing them. Realistically, a ban will not stop employees who want to be in a relationship from doing so secretly and this can lead to gossip and rumours circulating.

It’s important to recognise that workplace relationships can result in positive outcomes, such as an enhanced morale because employees want to go to work, and an increase in communication, creativity and energy.

However, employers should be aware of the threats they pose.
A senior-junior relationship can result in a loss of productivity and poor performance, due to distractions both mental and emotional, and may lead to others within the team making serious complaints about favouritism.

The risks of this relationship breaking down are quite high to the business, as the two individuals will remain within the same senior-junior positions at work. This could lead to tense atmospheres and even increased absenteeism due to the emotional strain of continuing in this employment relationship.

It is also vitally important to educate employees on sexual harassment policies. If people understand the context of sexual harassment as distinct from office romances, then this will reduce liability for companies should romantic involvements turn sour.

  • Posted on February 14th, 2018

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