Gordons Legal Employment Update – 2 February

2018 promises to be an interesting year in employment law and HR, with legislative changes taking effect and a number of cases with potentially far-reaching consequences going through the courts.  Significant developments expected in the coming year and the potential effects for employers are detailed below as follows:

Data Protection – GDPR comes into force

On 25 May 2018 the General Data Protection Regulations (‘GDPR’) will come into force, replacing the outdated Data Protection Act and regulating the way in which employers can store and process their employees’ data.  Notable changes of which employers should be aware include a restriction in how a data subject’s ‘consent’ is defined, which will in effect mean employers will often need to find an alternative lawful basis for processing employee data, and the imposition of a requirement for employers to report data breaches to the Information Commissioner’s Office within 72 hours.

If you require advice on ensuring your organisation is GDPR-ready, please contact a member of the Employment Team.

Gender pay gap reporting

With only 2 months to go until organisations with 250 or more employees are required to publish their gender pay gap data, employers should now be taking steps to compile relevant data and carry out the necessary calculations if they have not already done so.

As we have previously reported, private businesses and public bodies are required to publish their data both on their own website and the government’s gender pay gap website (here) by 4 April 2018 and 30 March 2018 respectively.  At the time of writing only 761 (out of an estimated 9,000) organisations have published their data.

With organisations that do not comply with their duty to publish their gender pay gap data potentially facing unlimited fines and convictions (according to the enforcement plan published by the Equality and Human Rights Commission), it is imperative that organisations take the appropriate steps now to ensure compliance.

National Minimum Wage change

In the Autumn Budget, the Chancellor of the Exchequer stated that from April 2018 the National Minimum Wage/National Living Wage will increase as follows:

• For those aged 25 and over – increase from £7.50 to £7.83
• For those aged 21 to 24 – increase from £7.05 to £7.38
• For those aged 18 to 20 – increase from £5.60 to £5.90
• For those aged 16 and 17 – increase from £4.05 to £4.20
• For apprentices – increase from £3.50 to £3.70

Employers must ensure they are ready to implement any wage increases to comply with the law in advance of the April deadline.

Employment status

2017 saw the cases of Pimlico Plumbers v Smith and Uber BV and others v Aslam and others establish that individuals treated as self-employed were in fact ‘workers’ and consequently entitled to additional (and backdated) rights and protections.  Both Pimlico Plumbers and Uber have appealed against those decisions, Pimlico Plumber’s appeal to be heard in the Supreme Court in February and Uber’s appeal to be heard in the Court of Appeal later in 2018.  Both appeals will likely have far-reaching implications for the operation of the ‘gig economy’ and we will report and provide analysis on the judgments in both cases when published.

On 20 November 2017 the House of Commons Work and Pension and BEIS Select Committees published a report with accompanying draft legislation in response to the July 2017 ‘Taylor Review of Modern Working Practices’, which itself recommended that greater clarity should be given as to who is categorised as a ‘worker’ and who is genuinely self-employed.  The government is yet to officially respond and it remains to be seen whether it will legislate on the issue in 2018.

Holiday pay cases

In November 2017 the European Court of Justice published its preliminary judgment in Sash Window Workshop Ltd v King, holding that a worker’s right to paid annual leave carries over and accumulates indefinitely in circumstances where he/she has not taken annual leave because he/she would not be paid for it.

As we reported at the time (here), the potential effect of the ECJ judgment is that workers who have been incorrectly designated as ‘self-employed’ will be able to claim unpaid holiday pay stretching back many years.  The case will return to the Court of Appeal this year, where one of the Court’s tasks will be to assess how to quantify the loss suffered by Mr King due to his not being paid holiday pay in circumstances where he continued to work and get paid for that work.

In March 2018 the Court of Appeal will also hear Shannon v Rampersad and another t/a Clifton House Residential Home, a case in which the Employment Appeal Tribunal held that Mr Shannon was not entitled to holiday pay relating to untaken holiday preceding the holiday year in which he was dismissed.   That decision predated the preliminary judgment of the ECJ in Sash Window Workshop and it may well be that the Court of Appeal overturns the EAT decision.

Disability Discrimination

Two important judgments from the Court of Appeal in 2018 are expected to provide guidance on the operation of disability discrimination and harassment provisions in the Equality Act 2010.

The Court of Appeal’s judgment in Donelien v Liberata UK Ltd is expected to be published in early 2018 and is hoped to provide clarification for employers as to the lengths to which they must go to ascertain whether or not an individual has a disability.  On 27 March 2017 the Court of Appeal will hear Peninsula Business Service Ltd v Baker, a case in which the Court will consider whether or not a claimant has to prove he/she is disabled to successfully bring a harassment claim under the Equality Act 2010.

We will of course report on those judgments when they are published, and on any other developments in employment law of importance to employers, throughout the year.