Employment Matters

HR and Employment News Summer 2012

CONTENTS

1-2 Pension reform

2-3 Appraisal Regulations and Model Policy – September 2012

3-4 Persistent short-term absenteeism – what can you do about it?

4 News in Brief

Pension reformFrom 1 October 2012 the Government’s pension reforms are due

to start taking effect. There are three key elements:

u A new requirement on employers to enrol automatically to

“jobholders” in a workplace pension scheme.

u Mandatory minimum employer pension contributions.

u A prohibition on certain recruitment practices.

Auto-enrolment The new legislation dictates that an employer will be required

to enrol automatically an eligible “jobholder” in an automatic

enrolment pension scheme, unless he/she is already a member

of the employer’s pension scheme, which complies with certain

requirements.

A “jobholder” is defined as an employee or worker who:

u works (or ordinarily works) in the UK under a contract;

u is aged at least 16 and under 75; and

u is paid “qualifying earnings” by their employer.

In order to be eligible a jobholder must:

u Be at least 22 and not have reached state pension age;

u Be paid earnings that exceed the earnings trigger; and

u Not already be an active member of his employer’s qualifying

scheme.

A scheme will be an automatic enrolment scheme if it is:

u the central personal accounts scheme set up by the Secretary

of State (NEST); or

u an alternative existing scheme established by the employer

that counts as a qualifying scheme.

Employers will need to obtain specialist advice on whether a

pension scheme that they currently operate, or participate in,

fulfils the requirements.

There are detailed provisions dealing with when employees

should be enrolled and how an employee can opt out of the

arrangements. Essentially, the onus is on the employee to exercise

their right to opt out and an employer cannot encourage this in

any way.

Large employers will begin auto-enrolment first (1 October 2012).

Employers will then be assigned a “staging date” according to

their size, which will specify when they must take action. Small

businesses will not need to begin enrolling their staff until May 2015.

Mandatory minimum employer contributions for defined contribution schemes One of the key reforms is the requirement for employers to

make minimum contributions into their employees’ pension

arrangements. This requirement is to be phased in over six years,

with employers eventually (by 1 October 2018) being required to

make minimum employer contributions of 3%.

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Pension reform (continued)

Employment protection measures The Government has enacted a range of employment protection

measures that are designed to safeguard the new rights

bestowed on employees by the legislation. The measures are

intended to prevent employers taking steps to avoid their duties.

Included in the measures are provisions which state that

employers cannot ask applicants prior to recruitment whether

they plan to opt out of auto-enrolment, nor can they offer any

kind of inducement (financial or otherwise) to individuals who are

eligible for auto-enrolment to opt out. This could be in the form

of an increase in salary or benefits, or a bonus.

That is all very complicatedIt is correct to say that the measures put in place are not easy to

navigate and it is likely that most employers will not be required

to take any action until at least 2013. However, prudent employers

should be considering some of the following at this stage in order

that they can fully prepare for taking any required steps in the

future:

u Which employees fall within the definition of jobholders?

A careful analysis by an employer of its employees at this stage

would be extremely sensible.

u What pension arrangement(s) does the employer currently

offer? An employer will need to address what it currently

offers and whether this scheme complies with the quality

requirements set down in the legislation. As part of this process

an employer could use this opportunity to review the pension

benefits offered to staff and consider their suitability long term.

For example, many employers are offering membership of

the NEST scheme in conjunction with their own occupational

pension scheme.

u How are employers going to communicate the changes to their

employees? Employers should consider how they are going to

communicate the changes to their employees and develop a

workable method of informing employees of the practicalities

of the change, i.e. how they can opt out, what contributions

they will be required to make and when.

For further information please contact Jean Boyle on –

JeanBoyle@stoneking.co.uk

Appraisal Regulations and Model Policy – September 2012As those of you running schools in the maintained sector will be

aware, you are subject to new Appraisal Regulations with effect

from the 1 September 2012.

The Regulations require the School to:

u adopt an appraisal document;

u appoint an external adviser for the purposes of appraising the

Head Teacher;

u generally provide for a 12-month appraisal period;

u provide that Schools should set standards for assessment

purposes which should include the Teachers Standards 2012; and

u provide that the school should issue appraisal reports at the end

of the appraisal period.

The Department for Education has also issued a Model Policy which

is divided into two parts: part A deals with Appraisals and part B is

the Capability Procedure.

Whilst Academies (subject to the specifics of their funding

agreements) and indeed, independent schools are not obliged to

performance manage against the new Teachers Standards 2012, we

are aware that many Academies do intend to apply the Teacher’s

Standards for that purpose and indeed adopt the Model Policy.

One of the headlines has been that there is no informal element

to the Capability Procedure and strictly speaking this is correct.

However, the Model Policy clearly anticipates that the appraisal

process will be an ongoing and supportive exercise and only if “the

appraiser is not satisfied with progress” will the School move a

teacher on to the Capability Procedure. Consequently an informal

stage is likely to be addressed during the appraisal process.

The Capability Procedure includes a time scale such as that if a

teacher did not improve, a point of dismissal could be reached

within 9 weeks. That is all the more reason why it is important

that Schools ensure that they address the appraisal process

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An employee’s (lack of ) capability is a potentially fair reason for

their dismissal. Dismissals for lack of capability encompass a very

wide range of scenarios – from an individual’s poor performance

whilst at work, through to their complete lack of performance

due to long term absence from work. Nevertheless, capability

dismissals tend to be seen as being ‘harder’ than misconduct

dismissals possibly due to the inherent personal criticism which

such actions inevitably appear to convey.

Not addressing capability issues as they arise though for fear

of an unpleasant situation developing almost always leads to a

more difficult, and more unpleasant problem, further down the

line. Allowing concerns about performance, or about attendance,

to linger often ends up with managers becoming frustrated and

wanting to dismiss someone in too short a space of time to be

a fair dismissal. Persistent short-term absenteeism is one area

where this situation arises fairly often, and an employer can find

itself in a situation where a manager’s patience has run out but

the employee is unaware that there is a problem.

What can an organisation do in these situations? The first step

is to check your policies and then follow them as they apply to

someone whose absence rate is unacceptably high. If you do

not have a relevant policy, consider what is needed within your

Persistent short-term absenteeism – what can you do about it?

appropriately to minimise the risk of a Tribunal judging that they

had been unreasonable in applying the Capability process leading

to dismissal.

Some general considerations:

u For Maintained Schools it is only the Appraisal Regulations that

you must comply with; the Model Policy is a matter for you to

decide whether you wish to introduce.

u If you have a contractual Capability policy bear in mind that a

change would amount to a variation and care needs to be taken

to effect that; even more so if your School is an Academy.

u The Model Policy does not address ill health lack of capability.

u With regard to the removal of the 3-hour classroom observation,

beware of the risk of allegations of being bullied/harassed by

over monitoring. Consider adopting a Protocol which is not overly

prescriptive.

u Beware of the possibility of a grievance being raised during the

process and if so consider whether it can be dealt with as part of

the process if it is linked.

u Consider also the possibility of someone going off sick e.g.

with stress, during the process and the need to refer them to

occupational health, better still a specialist consultant in the area

of ill health concerned.

u Consider union reaction. Note in particular, the NUT website.

Christine Blowers, the General Secretary of the NUT, has written:

“We hope that many Schools and Local Authorities will be keen

to reject these changes as unfair and unnecessary but where

there is a threat that they will be adopted, the NUT will support

you and will use the threat of, and will ballot for, industrial action

when necessary. We will be co-ordinating action across and

between schools and Local Authorities.”

u The most important thing is to ensure that you take your staff

“with you”: explaining the reasoning behind, for example,

adopting the Model Policy; and explaining in the event you do,

that effectively there is an informal process within your appraisal

process (consider whether you should introduce a Protocol e.g.

on classroom observation).

u If your School is an Academy, it is unlikely that you would wish

to include the wording in the Model Policy “before the decision

to dismiss is made, the School will discuss the matter with the

Local Authority”.

u If you are in the process of converting to Academy status, and

you envisage that you will adopt the Model Policy, that almost

certainly amounts to a “measure” so you should both inform and

consult upon the proposal to adopt the Model Policy as part of

your TUPE process.

For further information of any of the issues raised above,

please contact Nick Watson on nickwatson@stoneking.co.uk

“Persistent short-term absenteeism is one area where this situation arises fairly often, and an employer can find itself in a situation where a manager’s patience has run out but the employee is unaware that there is a problem.”

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www.stoneking.co.uk email: employment@stoneking.co.uk © Stone King LLP 2012 06/2012

Employment Matters deals with some current legal topics. It should not be used as an alternative to specific legal advice on the individual circumstances of a particular problem.

Stone King LLP – registered limited liability partnership no OC315280, registered office 13 Queen Square, Bath BA1 2HJ

Your Contacts

Nick Watson Partner email: nw@stoneking.co.ukPeter Woodhouse Partner email: pmw@stoneking.co.uk

Tamsin Wilkinson move to Cambridge office We are delighted to announce that Tamsin

Wilkinson has been promoted to an Associate

and will moving to our Cambridge office with

effect from Monday 18th June. Tamsin’s move

to Cambridge will ensure that we are able to

provide local, high quality, legal services to our

News in Brief

organisation and consider adopting a policy which meets your

needs. For someone whose absence rate is unacceptable, look

for any underlying reasons, and consider what you can do to

assist them with improving their attendance. Those reasons

may lie outside of your business, so be careful that you do

not inadvertently discriminate against employees with caring

responsibilities for children, dependent adults, or disabled people.

Consider analysing the impact which short-term absence has on

your business, and identify ‘trigger’ points at which employees

have their absence more closely monitored under a suitable

capability / absence management policy. Carry out full return

to work interviews and discuss with employees who trigger the

policy what an acceptable absence rate is both generally and by

reference to their particular circumstances. It is important to set

targets which are both achievable and measurable, and be even

handed in the application of the policy across the whole workforce

– there can be a temptation to move too quickly with those staff

whose absence has not been properly managed in the past and

with whom there is more frustration as against those who are

only just beginning to have unacceptably high levels of absence.

Persistent short-term absenteeism can be a significant

problem for many organisations, but careful and even-handed

management of it can produce results which benefit all parties

involved.

For further information please contact Tamsin Wilkinson on

tamsinwilkinson@stoneking.co.uk

clients in the East of England as well as the HR support which is

already provided through the Cambridge office. Tamsin will be

focusing her efforts on providing on-the-ground support, so if you

would like to arrange a time for Tamsin to visit your premises to

discuss the services we can offer, please do contact her on 01223

451 342 or by email at tw@stoneking.co.uk