Having a workable understanding of Employment Law is essential for a small to medium sized business.
Whether you’re a well-established company or taking on employees for the first time, it’s crucial that you’re aware of legal considerations when hiring new staff.
Employment law is a complicated area that encompasses dozens of different laws and acts in relation to the rights of employees. This can include pay rights, discrimination, health and safety and contracts among other things. Due to the complexity of this legislation, medium to large sized companies often choose to hire a lawyer or business advisor to make sure the company is watertight in the way it deals with employees and any possible disputes.
We’ve compiled a brief guide to some of the main areas of Employment Law that you need to be aware of.
The statutory rights of an employee cover a multitude of employer responsibilities, including an itemised pay slip, the right to a written pay contract, being paid at least the national minimum wage, statutory sick pay (commencing the fourth consecutive day they do not attend work due to illness), the right to at least 28 days paid holidays (including bank holidays) and, in some cases, paid maternity leave. A failure to comply with these directives can lead to hefty fines or legal action.
Contracts are essential pieces of legislation for both the employer and the employee. The contract should set out the employees duties, responsibilities, rights and employment conditions, and it’s important that it’s in line with all relevant employment laws.
The law states that ‘as soon as someone accepts a job offer they have a contract with their employer’; it doesn’t have to be a written contract. Other elements of a contract include implied terms, collective agreements and a written statement of employment particulars.
Business owners are responsible for their employees’ wellbeing at work. These include responsibilities in relation to health and safety, bullying and discrimination, maternity/paternity leave, among other things.
The Health and Safety Act requires you to carry out a thorough risk assessment on your business premises. You must also keep an up-to-date health and safety policy and a record of all accidents. More information on that can be found here.
The rules and regulations for freelance and agency workers are slightly different from full-time employees, so it’s important to be aware of this. Most workers are still however entitled to a number of rights, such as the right to be paid at least the minimum wage, limits on working time and for their employer to adhere to health and safety regulations.
By creating an exhaustive employee handbook, business owners are creating a standard reference point that can be referred to should any disputes occur within the company, or any confusions arise among all employees.
There are many resources that can be found online, for example, here.
As a conscientious employer, it’s very important that prejudice never plays a part in any of your business decisions. Discrimination on the grounds of race, sex, disability, sexuality or age is illegal and can result in prosecution.
If someone does not fit the required criteria, then it is of course acceptable to reject them accordingly. It should be remembered that an interview is now able to ask for all records of your recruitment process, so don’t forget to keep an account of these.
As an employer you are also responsible for any discrimination occurring amongst your employees, and all allegations must be investigated and taken seriously.
Hours, leave and pay
Statutory requirements with regard to hours, leave and pay should always be complied with. Some of the main ones are:
- Most employees are entitled to work a maximum of a 48-hour week, although you can offer an opt-out clause.
- Under the Working Time Directive an employee’s annual leave entitlement is 20 days, which may include public holidays.
- Maternity leave, paternity leave, adoption leave, parental leave and leave for family reasons must all be included in any employee contract. Pregnant woman and new mothers have a number of special rights and entitlements, which it’s important to be aware of.
- As an employer you are required to give each employee a written and itemised pay statement which details gross salary, any deductions made and the employee’s net pay.
- A new law means that by 2018 employers must automatically enrol workers into a workplace pension scheme if the employee is aged between 22 and pension age, if they earn more than £10,000 per year and if they work in the UK.
The first step is to make sure that all your disciplinary procedures are in place according to statutory guidelines.
Through your employee guidebook, make sure your employees are aware of what constitutes disciplinarily action and the process currently in place.
Unlawful dismissal can result in a legal tribunal, so you need to be able to prove that you have good cause to dismiss an employee if you do. Employees have the right to appeal against a dismissal if they feel it was unfair, so it is imperative that you document all correspondence and action related to the dismissal.
When thinking about growing your company, it’s imperative that you make sure you and your company adhere to all the necessary laws and regulations when taking on new employees. As a starting point, take a look at the government website for an overview of information on this topic.
Employment law is a complex area that is constantly affected by frequent changes and amendments. However, ignorance is no defence if you fall foul of employment legislation, and the consequences on your business growth and reputation could be disastrous.