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Making Deductions from Final Pay

#HRFridayFact: Deductions can only be made from an employee’s final pay if there is a clause in their contract that allows it.

When a worker leaves your employment for whatever reason, you must calculate their final pay to take account of statutory holiday days that they have accrued. If they have are owed any holidays, they must be compensated for this as pay in their final wage or salary payment.

However, if they have taken more holiday days then they have accrued, in order to make a deduction from their final pay to compensate the company for the days they have not worked but have been paid for, there must be a relevant clause in their contract which allows you to do this.

Holidays is the obvious instance where this situation might arise, but it also goes for other instances where you might want to make a deduction, such as advanced bonus, commission or productivity payments; or where there is damage to company equipment such as a mobile phone or vehicle that was caused by the employee.

If you are making a final payment under a Payment in Lieu of Notice (PILON) clause, you do not have to calculate the holidays they would have accrued in their notice period because you are paying them ‘in lieu’. Additionally, provided you could give adequate notice, you could potentially require the leaver to take any outstanding holiday during their notice period should they work it, thereby nullifying the need to make a payment for it.

Incorrectly making deductions from an employee’s final pay will effectively mean you are in breach of contract. Whilst this isn’t necessarily a Tribunal situation, you could find yourself in receipt of a letter from the employee’s solicitor.

For help and support with all your HR, Employment Law and contractual issues, please call us on 01452 331331 or e-mail info@hrchampions.co.uk

23 June 2017, 12:01

Worker Status

#HRFridayFact: The status of someone who does work for you will affect their rights. Workers are not necessarily employees

A worker’s status will potentially have a significant effect on the rights he or she is entitled to. Similarly there are tax implications for businesses who get it wrong under IR35 legislation, so it is vital that businesses refer to workers correctly and use the appropriate status of worker for the job in hand.

IR35 legislation, first introduced in 1999, is currently being revitalised by HMRC who are looking at contractors supplying to the public sector, but it may only be a matter of time until their net widens to include the private sector.

The legislation is designed to close the tax avoiding loophole of workers who set up limited companies to provide services on a business-to-business relationship basis, where in fact an employer-employee relationship is more appropriate. IR35 means PAYE and NIC deductions are made at source as though the contractor was in fact an employee.

To help you establish the status of your workers’ we’ve compiled a brief guide of the rights of each. This is by no means exhaustive and if you are in any doubt you should contact us for further advice.

Full-Time Permanent Employee: An employed member of staff who works a full working week (Usually 37.5 hours but can vary) and for whom you deduct PAYE tax and National Insurance through your payroll. They are entitled to paid holidays of at least 20 days plus public holidays per year, statutory sick pay and maternity/paternity/adoption/shared parental leave. Full employment rights accrue after two years’ service.
Part-Time Permanent Employee: The same as a full-time employee, including rights accrual, but will work for a reduced, set number of hours or days per week; e.g. 16 hours per week or 3 days per week. Holiday and some other benefits will be calculated on a pro-rata basis.

Temporary Employee: A member of staff employed for a set period usually of less than 6 months. If a temporary worker is taken on as a permanent member of staff without a break in employment of at least 2 weeks, the period of temporary work will be accumulated with their permanent term when calculating rights. A temporary worker who has worked for you for more than 24 months will have accrued the same rights as a permanent employee.

Temporary Employee – Agency Employed: For very short term appointments of just a few weeks or even days, temporary staff are often taken on via an agency. In this situation, workers are usually employed by and paid by the staffing agency. Current legislation means that they have equal rights as employed staff for company facilities and benefits such as a staff canteen or crèche; and rights to equal pay after 12 weeks.

Fixed Term Contract: Fixed term contracts are usually used to employ staff to manage or cover a specific project or period of maternity leave. Once that project is complete the position for which the fixed term contract was instigated no longer exists and the employee is let go. The worker is employed by you for the period of the contract. Again, workers under fixed term contracts of more than 24 months will accrue full employee rights. This means that redundancy might be the more appropriate option to terminate the contract if employment exceeds 2 years.

Casual Workers: Casual workers are likely to be employed on a zero-hours contract. They are only given work when there is work to be done and therefore only paid when they have carried out any work. There is no obligation for an employer to provide work or for the worker to accept. Event catering is a good example of an industry that would use casual workers. Casual workers don’t have any rights although once again this changes if they worked continuously without a break in service for more than 24 months. In any documentation they should be referred to as workers and NOT employees.

Contractor: A contractor would be self-employed or employed through another company and provide services to you for a fee. You would not be responsible for paying a wage or salary nor any benefits. Instead you would pay in response to being invoiced. The relationship would be governed by Business Law rather than Employment Law. However, a contractor who works exclusively for one customer for an extended period of time might be considered to be an employee by the Inland Revenue and so subject to PAYE rules.

In all cases you should at the very least check that your employee’s contracts describe what you believe their status to be. If there is a discrepancy, don’t act without seeking advice as you may unwittingly be in breach of contractual terms. You can contact us for further advice or assistance regarding employee statuses and relevant contracts by telephone on 01452 331331 or by e-mailing info@hrchampions.co.uk

16 June 2017, 12:06

Discrimination in the Recruitment Process

#HRFridayFact: Discrimination Law applies from the outset of the recruitment process including your advert, selection & conduct at interview

Employers should remember that the Equalities Act applies from the outset of the recruitment process. Claims for discrimination, for which there is no cap on compensation, can occur if your job advert or recruitment process is discriminatory.

Whilst we are unlikely to be deliberately discriminatory when recruiting new employees, we should remain vigilant of our own actions and processes in case something that we think is innocent, slips through the net. Using phrases that describe positions as suiting either a young or a mature person instantly crosses the line. Specifying too that you are looking for someone of a particular gender, unless there is a cast-iron reason to do so, is an absolute no-no.

During the selection process, scoring systems are usually a good way to go to whittle applicants down to a shortlist for interview. Depending upon the position available, you could award scores for relevant qualifications, experience in both similar roles and business sector, career continuity or IT skills for example. Make sure that any scoring system you use is applied consistently and fairly to all applicants and keep all your results as proof that a fair process was used for six months.

Unconscious bias has become something of a catchphrase in recent years and some organisations omit applicants’ names from application scoring systems. This means that their ethnic origin or gender cannot be guessed or assumed by those doing the scoring thereby avoiding any adverse scoring being applied due to the scorer’s underlying prejudices.

A female applying for a job as a heating engineer for example may be unconsciously marked down because it is a job normally associated with men, even though she may be the most highly qualified and suitable applicant.

At interview be conscious of the questions you ask. Health and disability issues do not have to be declared until after a job offer has been made and accepted unless the issue relates intrinsically to the job.

Asking a female applicant if she intends to have children in the future is blatant sexual discrimination but with Shared Parental Leave now a reality, asking the same of a male applicant could also get you into hot water.

Ultimately, you should always aim to employ the best person for the job regardless of any other factors. How they fit in with your team is likely to be an important factor so personality and how they come across at interview will potentially have as much bearing as skills and experience. To avoid tribunal claims however make sure that if asked, you can prove that a fair selection process was used.

For help and support with all stages of recruitment, including induction processes, call us on 01452 331331 or e-mail info@hchampions.co.uk

09 June 2017, 14:26

Pulling a Sickie

#HRFridayFact: Employees who get caught “throwing or pulling a sickie” expose themselves to disciplinary action up to dismissal

Staff members who fail to attend work claiming to be ill when they are not risk disciplinary action up to and including dismissal if their employer has evidence that they are not actually sick.

Employers shouldn’t jump to the conclusion that an employee is being untruthful if they call into work sick unexpectedly. Even when a sunny day, sporting or music event gives rise to suspicion, without evidence the employee should be given the benefit of the doubt.

Modern technology, and in particular social media platforms such as Twitter and Facebook, do however provide opportunities for staff who have spuriously claimed a day off sick to expose their untruth. At HR Champions we have seen images from clients whose employees are on holiday as far away as South East Asia when they are reportedly off work due to sickness.

Even if you do suspect that a sickie is being thrown, without evidence, you should really overlook a one-off event. The employee isn’t statutorily entitled to pay anyway for one day’s sick leave. Alternatively, implement a pre-emptive strategy such as “duvet days”. Originally an American idea, duvet days effectively grant employees perhaps two days per year when they can stay in bed and take a day’s leave on a whim.

Having a robust absence policy in place will help to control the occasional dubious sickie and will also help to manage persistent and unacceptably high sickness absence, even where there is a genuine illness. Your absence policy should include conducting return to work interviews, even for just one day’s absence; and have the employee sign a statement.

Where evidence is forthcoming that the employee isn’t really ill, which maybe a sighting from other employees or perhaps a social media posting, action should be taken. Not dealing with unauthorised absence promptly will send the wrong message to other staff members and will make it acceptable practice and almost impossible to deal with effectively in the future.

Follow a disciplinary process including an investigation. Circumstances should be taken into consideration but even an isolated sickie could result in disciplinary action up to and including dismissal. If it transpires that a bogus absence has been taken, falsifying company documents such as an absence or return to work form is an additional offence that can be taken into account when considering disciplinary action.

For further help and support with managing absence, call us on 01452 331331 or drop us an e-mail at info@hrchampions.co.uk

01 June 2017, 15:40

Thermal Comfort in the Workplace

#HRFridayFact: There is no upper limit for workplace temperature. Use the Six Basic Factors to assess the ‘thermal comfort’ of employees

With the temperature suddenly soaring this week, employers may be asked to make provision for controlling the temperature at work. Whilst there is no maximum workplace temperature in Law, employers should remember that they have a duty of care to their employees.

UK Law does not stipulate a maximum workplace temperature, however the Health and Safety Executive (HSE) refers to the “Thermal Comfort” of employees when discussing employers’ legal responsibilities. Thermal Comfort is recognised as a state of mind and is how people feel.

The HSE recommends using the Six Basic Factors when establishing Thermal Comfort. Divided into environmental and personal, the six factors are:


  • Air temperature – The ambient temperature of the air surrounding workers
  • Radiant temperature – Heat that radiates from a warm object; this will most commonly apply in an environment with a heat source such as an oven in a kitchen or dryer in a dry cleaners
  • Air velocity – The speed of the air in the workplace that moves across employees. Even when the air is still warm it can have a cooling effect via convection. Still or stagnant air can cause a stuffy feeling in people
  • Humidity – Humans reduce body temperature when sweat evaporates from the skin. When there is too much moisture in the air, ie. the humidity is high, sweat cannot evaporate and so the cooling effect is lost. Workers who have to wear special safety clothes may suffer when the humidity inside their protective garments increases


  • Clothing insulation – More clothes tend to mean we retain more heat in our bodies. Some employees may not have a choice of clothing due to company or job specific uniforms or because of the need to wear protective clothing. Modern, lighter fabrics may be an option where clothing restrictions apply
  • Work rate/metabolic heat – Workers with physical jobs will produce heat as they work and this will be further affected by their physical characteristics such as weight, age, fitness level and gender

At work, the risks associated with thermal discomfort include:

  • Dehydration and even Heatstroke
  • General irritability leading to conflict with other employees
  • Tiredness, resulting in accidents
  • Higher stress levels and associated ailments

Ultimately, during warm spells, common sense should prevail. When remembering your duty of care towards employees, some simple steps that can be taken include:

  • Ensure airflow through the building is sufficient
  • Where possible, open windows and doors or provide fans
  • Make drinks readily available and encourage employees to take an extra break
  • Consider alternative shift patterns or working hours ie. earlier start and finish times
  • Introduce a comfort zone where the temperature can be controlled and allow managed access to it
  • Relax the dress code, within reason
  • Investigate the possibility of alternative working environments. eg. Another office, home, outside
  • Pay special attention to those at higher risk ie. pregnant or older employees

Apart from creating a more comfortable environment during hot weather, such actions will also promote the image of a caring employer, which will in turn bring its own rewards.

For help and advice with managing your workforce and work environment under exceptional weather conditions, call us on 01452 331331 or e-mail info@hrchampions.co.uk

26 May 2017, 11:05

Dismissing at Nearly Two Years' Service

#HRFridayFact: When dismissing employees, notice periods count toward the employment term. There can be issues when nearing 2 years’ service

We know that employees with less than two years’ service don’t have a claim for unfair dismissal. Deciding to dismiss within reach of two years’ service however, may be viewed as cynical by a Tribunal and if the employees notice period takes their service over two years then they will automatically have a claim for unfair dismissal.

Whilst two years is recognised as the cut-off point, after which an employee accrues unfair dismissal rights, it’s not always that simple.

Firstly, the notice period must be taken into account. Obviously you’ve issued a contract of employment so you’ve no doubt included the notice period in this. If you haven’t specified a notice period then the statutory term is one week which your contract will default to. So that’s not too bad is it?

If you have been generous however, or have incorporated a longer notice period because you know it’s a difficult position to fill, you may find yourself with perhaps a one month or three month notice period; so you’ll need to be dismissing before 23 or 21 months have expired.

But it’s still not that straight forward. If it looks like you’re dismissing shortly prior to the two year threshold because you are trying to avoid your employee from accruing unfair dismissal employment rights, then an Employment Tribunal will likely see straight through it and make an award as if the employee had worked for more than two years.

Unless you have watertight business reasons for dismissing shortly before the two years is up, it’s a difficult position to contest. What’s more, because it will appear a cynical move on the employer’s part, a Tribunal is likely to look very dimly on such a case and might hand out a particularly harsh punishment.

If you are going to dismiss someone within a two year period on performance grounds, it’s probable that the reasons for dismissal will arise long before the two year point, and therefore should be dealt with much sooner.

Even in redundancy cases, it’s not advisable to exclude those close to two years’ service from the full redundancy process. Simply dismissing them purely to reduce the redundancy bill will also be frowned upon by Tribunal.

If this raises any issues or concerns with you then please call or e-mail us for support and advice on 01452 331331 or info@hrchampions.co.uk

19 May 2017, 10:02

Requesting Health Questionnaires

#HRFridayfact: Asking about health issues at job interviews is unlawful. A health questionnaire once a job is offered is a good idea

During the recruitment process, job applicants are not required to disclose any disabilities that they have and it’s unlawful to ask. Therefore, once a job offer has made the employer should ask the new recruit to complete a health questionnaire so that any reasonable adjustments can be made. Employees are not obliged to complete a health questionnaire but doing so will probably be in their interest.

A health questionnaire will also give the employer information about any underlying health issues the employee might have for future reference.

The receipt of satisfactory references and proof of right to work are usual conditions under which job offers are made. Whilst you might send out the Health Questionnaire along with the job offer letter, the results of the questionnaire should not be a conditional term to the job offer. Making it so will almost certainly be deemed as discriminatory under the Equalities Act.

Once the completed health questionnaire has been received back by the company, due consideration should be given to the answers and an assessment made as to whether any reasonable adjustments are required for the new employee to complete their job function. Remember that reasonable adjustments include flexibility in working times and locations as well as physical changes to the workplace. We advise that you always consult with the employee.

It may be necessary to write for a doctor’s report for further information regarding any conditions disclosed by the employee. In such cases, remember that a medical consent form must first be obtained from the employee. You may need to meet with him or her to discuss the medical report and any potential adjustments.

There may be occasions where a medical condition or disability affects the employee’s ability to do the job safely and without putting their own, their colleagues’ or their customers’ health at risk. Someone working at heights who suffers from seizures, for example. These circumstances could then present grounds to withdraw a job offer for capability or safety reasons.

If this does happen, make sure that all reasonable adjustments have been considered and discussed with the prospective employee and that your considerations and discussions have been documented.

As a final note, we would advise that you always recruit the best person for the job, and don’t change your opinion of their ability based upon the results of their medical questionnaire. Hence, only request that the quesionnaire is completed after the job offer is made.

For further support with recruitment and employee health and capability issues, call us on 01452 331331 or e-mail info@hrchampions.co.uk

11 May 2017, 15:42

Discrimination vs Bullying

HRFridayFact: Upsetting a colleague by unkindly referencing their ginger hair colour could be classed as bullying but not discrimination

The consequences of discrimination in the workplace can prove to be very costly for employers as tribunal awards are unlimited. Having ginger hair however is not a protected characteristic and so using this feature to harass or bully a colleague would not fall under discrimination rules.

The protected characteristics under The Equalities Act for discrimination purposes are gender, sexual orientation, race, age religious belief, disability. Upsetting a colleague by unkindly referencing a protected characteristic could be classed as discrimination.

Awards for discrimination have reached a staggering £4.5 million; and whilst this is an exception, there is no limit to the size of an award in discrimination cases.

Bullying and harassment awards run into the thousands or low tens of thousands of pounds. Claims could be for wrongful dismissal on the grounds of breach of contract by the employer for failing to uphold their bullying and harassment policy. Or there could be a constructive dismissal claim if the aggrieved employee felt they had to resign because they could not put up with their treatment at work.

Both of these could be further enhanced with awards for loss of earnings if the claimant was subsequently left out of pocket for not working whilst they looked for a new job.

Of course it is best to avoid both discrimination and bullying at work as an employer could find themselves liable for any awards made if it can be proved that they had no or inadequate policies in place and/or if they failed to train other staff in the application of those policies.

A business that can prove that they have taken reasonable steps to implement policies that safeguard against discrimination and bullying, and have created a non-discriminative organisational culture that is “lived and breathed”, can estrange themselves from the acts of any offending employees. Any fines or awards would then be attributed to the offending individual(s) who would be liable to pay.

Our “Dignity at Work” workshop is an excellent training course for businesses who want to ensure that any risks against discrimination or bullying and harassment claims are minimised.

Ask us about it on 01452 331331 or e-mail info@hrchampions.co.uk

05 May 2017, 12:44

Applying Holiday Policies

#HRFridayFact: Employers can dictate when staff take their holiday where it suits the needs of the business. Use a fair approach however

A proportion of your employees will probably have the timing of their summer holidays governed to some degree by the school holidays of any children they have. Whilst you are able to dictate when staff take their holidays to suit your business needs, a fair approach should be employed to avoid any discriminatory issues arising.

Most businesses will manage a holiday booking system that tries to be fair to all staff, but a first come first served arrangement usually prevails. We recommend that a formal request is made in writing, perhaps on a specific holiday booking form, or via any HR IT system that you might use. It a good idea to have a visible or accessible record of booked holidays so that staff can plan around holiday already allocated to colleagues. A simple wall chart might suffice.

Your holiday booking policy should be clear and transparent and you should be consistent in applying it at all times. You may need to rely on evidence of this if you find yourself denying a holiday request made by an employee so that he or she can attend a religious festival for example.

Just because someone has already booked their flights, this doesn’t guarantee that they will be given the time off. Again your policy should clearly state that employees should confirm with their manager or supervisor that they can have the time off work before they make any financial commitment or expenditure.

Employers are entitled to tell staff at an individual level when they must take time off. This may prove useful if an employee would be unable to perform their job because a particular colleague is absent, or if an employee hadn’t taken their holiday allocation under Working Time Directive rules.

You may find that it’s useful to have it written into your staff handbook if you know that your business will be consistently closed each year and your staff must allocate some of their holiday for that purpose. Between Christmas and New Year is a good example of this.

The statutory rule to remember when stipulating or when booking holiday is that double the notice must be given as the amount of holiday time to be taken. So if you tell an employee that they must take a specific week as holiday, or they request a week’s holiday, notice must be given or the request received at least two weeks before the holiday commencement date.

Finally, employers cannot prevent employees from taking their statutory holiday allowance of 28 days including bank holidays. So make sure that holiday is properly monitored to prevent an unavoidable clash of dates at the end of the holiday year for example.

For further help and support with holidays, including handling requests and implementing policies, call us on 01452 331331 or e-mail info@hrchampions.co.uk

28 April 2017, 12:29

Statutory and Contractual Notice Periods

#HRFridayFact: There is no statutory notice period required from either party where an employee has less than one month’s service

Statutory notice periods are the minimum period of notice that employers or employees can give when dismissing or resigning from post. These can be overridden with longer periods of notice in the employee’s contract of employment.

Employers have up to eight weeks to issue a contract of employment to a new starter. So if the contract hasn’t been issued and either party decides to terminate the employment within the first month, then no notice is required and the employee is free to simply leave.

If the contract has been issued and signed by the employee, then any contractual notice period contained within it will apply.

If the employee has been employed for a month or more but for less than two years, then the statutory notice period the employer must give is one week. This increases to two weeks’ notice after two years’ continual service. A further week of notice is added for each completed year of continual service up to a maximum of 12 weeks.

Employees need only give one week’s notice after one month of service and this does not increase with length of service unless otherwise stipulated in the employment contract.

After two years’ service, redundancy is likely to be the main reason an employer will want to dismiss where a disciplinary matter isn’t involved. It’s much more likely therefore that the employee will give notice and it’s for this reason that you should ensure that the notice period is specified in the employment contract and that it is suitable for the position.

For jobs that are difficult to recruit for, because a specific qualification is required for example, you may want to impose a longer notice period on the employee to give you time to recruit a replacement and also allow for a period of handover or transition. For other jobs, perhaps sales roles, you may want to exit an individual as quickly as possible.

You can specify different notice periods for different employees and have this written into individual contracts. You don’t have to have a blanket notice period that covers all staff.

Don’t forget that you can also incorporate Payment in Lieu of Notice (PILON) or Garden leave but these terms must be included in the contract to be enforceable.

For help and support with writing and issuing contracts of employment, call us on 01452 331331 or e-mail info@hrchampions.co.uk

12 April 2017, 15:34