Employment Matters Bite Size 2010

An overview of 2009 and a look ahead at 2010

2009 has been a big year for employment legislation and cases and 2010 looks to be even bigger.  We thought a round-up of the significant changes from 2009 and a look ahead at what’s in store for 2010/2011 would be useful. We would also like to take this opportunity to wish you a Happy New Year! 

Legislation

April 2009

Annual leave entitlement increases
The second increase in the statutory minimum holiday entitlement to 5.6 weeks per annum took place on 1 April 2009. Organisations providing 24 days annual leave must increase it to 28 days paid annual leave per annum. Bank holidays can be included providing there is provision within the terms and conditions of employment.

Right to request flexible working is extended
The right to request flexible working has been extended to parents of children aged 16 and under.  Previously the right was restricted to parents of children aged six and under (or 18 if the child is disabled), and carers of adult (18+) dependents. The employee must have 26 weeks continuous service before applying for the flexible working.

Changes to discipline and grievance procedures
The Employment Act 2008 came into force on 6 April 2009. The Act repeals the statutory dismissal and grievance procedures under the Employment Act 2002 and the associated Employment Act 2002 (Dispute Resolution) Regulations 2004.   

The Act gives tribunals discretion to increase or reduce awards by up to 25 per cent in certain cases where the employer or employee unreasonably fails to comply with the new ACAS Code of Practice on Discipline and Grievance Procedures.

The new ACAS code is intended to help employers and employees deal effectively with issues of alleged misconduct or poor performance in the workplace. Redundancy and non-renewal of a fixed-term contract are specifically excluded. The aim is for an earlier resolution of problems, aimed at lower costs and formality. The revised code is less prescriptive than the previous Statutory Dispute Resolution Procedure and a failure to follow the code alone will not make an employer or employee liable to tribunal proceedings but, of course, following the code should leave an employer less exposed to the risk of an unfair dismissal claim.

Increases in Statutory Sick Pay (SSP) and Statutory Maternity Pay (SMP)
As of 6 April 2009:  

• SSP was increased to £79.15 from £75.40 per week;

• SMP was increased to £123.06 from £117.18 per week.

October 2009

Redundancy pay and basic award increase
Statutory redundancy pay was increased to £380 on 1 October 2009 for each complete year of service.  The maximum redundancy payment therefore rose from £10,500 to £11,400.  The increase also affects a week’s pay for the purposes of calculating the basic award in tribunal proceedings; the maximum basic award is now £11,400.  The basic award will not increase in February 2010. 

National minimum wage increases
From 1 October 2009, the national minimum wage rates were increased as follows:

• adult rate (for those aged 22 and over): £5.80 per hour (previously £5.73 per hour)

• youth rate (18-21): £4.83 per hour (previously £4.77 per hour)

• rate for those aged 16 and 17 year-olds: £3.57 per hour (previously £3.53 per hour)

• The maximum amount that can be offset where accommodation is provided is £4.51 per day (previously £4.46 per day).

From 1 October 2009, tips, service charges, gratuities and cover charges, whether discretionary or mandatory, no longer count towards the national minimum wage.

The Government has also announced that, as from October 2010, 21 year olds will get the standard adult rate.