A reminder…
Don’t forget that the following key legislation came into effect on 6 April 2024:
- Flexible working: day-one right.
- Protection extended for pregnant employees against redundancy and for those returning from maternity, adoption, or shared parental leave.
- Unpaid carer’s leave.
- Changes to paternity leave.
We covered this in some detail in March’s update which you can find here.
Vento Bands Increase
The “Vento bands” are the guidelines that Employment Tribunals follow when assessing the appropriate level of financial compensation for ‘injury to feelings’ awards in cases of discrimination. There are three bands, all of which increased on 6 April 2024. These are as follows:
- Lower band: £1,200 to £11,700 (less serious cases, e.g., a one-off act of discrimination).
- Middle band: £11,700 to £35,200 (cases that do not merit an award in the upper band).
- Upper band: £35,200 to £58,700 (the most serious cases, e.g., following a lengthy campaign of discriminatory treatment).
In exceptionally serious cases, the upper band could exceed £58,700 and, as such, there is no “limit” on injury to feelings awards. It is worth noting that awards exceeding the upper band are extremely rare.
Although the Vento bands are not strictly binding, it would be highly unusual for them not to be applied by the Tribunal. It is for the Tribunal to decide firstly which band a case should fall into and secondly where it should sit within each band (for example, a Tribunal might award compensation in the middle level of the lower band, or the upper level of the middle band.)
Employment Tribunal Compensation Limits and Statutory Caps
In addition to the above, the Government also announced an increase to compensation limits and other statutory payments in Employment Tribunal Claims. The increased rates came into force on 6 April 2024 and the changes were enforced by The Employment Rights (Increase of Limits) Order 2024.
The key increases are as follows:
- Cap on a Statutory Week’s Pay (which is used for calculating statutory awards such as statutory redundancy pay and the basic award in unfair dismissal): £700.
- Cap on Statutory Redundancy Pay: £21,000
- Maximum Basic Award for Unfair Dismissal: £21,000
- Maximum Compensatory award for Unfair Dismissal: £115,115 (or one year’s gross pay, whichever is lower)
- Additional Award for Unfair Dismissal: £18,200 - £36,400 (this is based on 26 – 52 weeks’ pay subject to the statutory cap of £700)
- Statutory Guarantee Pay (for lay-off and short-time working): £38 per day (subject to a maximum of 5 days or £190 in any 3-month period).
Government guidance on holiday pay
The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 came into force on 1 April 2024. The Regulations have significantly changed the way in which holiday is both calculated and paid in relation to part-year and irregular hours workers.
For clarity, a worker will be regarded as a “part-year” worker if they are only required to work for part of the year, and there are periods of at least 1 week within that year when they are not paid and are not required to do work. Conversely, an irregular hours’ worker is one in which the hours they work are variable across the year.
A decision passed by the Supreme Court in Harpur v Brazel held that the commonly used method of multiplying hours worked by 12.07% to determine the rate of holiday pay was unlawful. The new Regulations have effectively reversed this, which means that employers can now revert to using this method of calculation. This only applies to leave years beginning on or after 1 April 2024.
To help employers calculate the correct holiday pay, the government has published updated guidance on these holiday pay and entitlement reforms. The guidance provides useful worked examples to assist employers in running their calculations.
The Regulations have also permitted the practice of “rolled-up” holiday pay, which was previously unlawful. This is the practice whereby employers pay a worker an additional amount to cover their holiday pay, rather than paying them when they actually take their holiday. Again, this can only be used for part-year workers and workers with irregular hours.
Some practical points for employers:
- The “12.07%” calculation method can be used to calculate pay for the purposes of paying rolled-up holiday pay;
- Employers must check their workers’ contracts to determine whether such practice is permitted or whether it could amount to a variation of contract (which would require the worker’s consent);
- The proportion of pay which constitutes rolled-up holiday pay must be clearly set out on the payslip and separated from the worker’s normal pay;
- There is no obligation on employers to pay rolled-up holiday pay. Employers can continue to use the 52-week reference period to calculate holiday pay and pay this when the worker takers their leave if it is their preference to do so.
Changes to immigration rules – SOC Codes and salary thresholds
Several recent changes to the immigration rules have an impact on employers of migrant staff. Statement of Changes HC 590, laid before Parliament in mid-March, is of particular significance as it implements much higher salary thresholds for Points-based sponsored migrants under the 2020 Standard Occupational Classification codes – part of the hard-hitting package of Government measures to reduce migration, announced late last year. Aside from some unfortunate drafting errors and incomplete technical adjustments to the sponsor management system which will have to be corrected, the main points for employers are:
- Skilled workers’ default salary threshold increases to £38,700 (from £26,200)
- An increase in the default annual threshold of £29,000 (from £26,200) for workers sponsored for Health and Care visas.
- Global Business Mobility general annual thresholds increased: Senior Specialist Worker - £48,500 (from £45,800); and Graduate Trainee - £25,410 (from £24,220)
- Shortage Occupation List radically overhauled and renamed ‘Immigration Salary List’.
- From 11 April 2024, the minimum annual income requirement for Family visas increased for new applicants to £29,000 (from £18,600).
- Savings’ level required to meet threshold (for those family applicants relying solely on savings) increases to £88,500 (from £62,500).
Our Business Immigration team is busy helping clients get to grips with the implications of these changes for their recruitment and retention needs, and to negotiate through the practicalities of the new points calculations. Please see a link here to our updates on other recent business immigration developments. For help with these and other immigration-related queries, please get in touch.
Key legislative changes: FAQs
We have created a set of Frequently Asked Question and Answer documents on some of the key changes including:
- (The Flexible Working (Amendment) Regulations 2023.
- The Protection from Redundancy (Pregnancy and Family Leave) Act 2023.
- The Carer’s Leave Act 2023.
- The Neonatal Care (Leave and Pay) Act 2023.
These are available for £350 + VAT each, or at a discounted price of £1,000 + VAT for all four. Please get in touch if you would like to purchase one or more. Please let us know if there is another topic you would like us to cover.
If you are a YEAR client and have not yet received your updated policies and Q & A’s (which are part of your package), please get in touch.
Case update
Rentokil Initial UK Ltd loses appeal against former employee in reasonable adjustments case
Rentokil Initial UK Ltd v Miller [2024] EAT 37 (14 March 2024)
Rentokil Initial UK Ltd employed Mr Miller as a pest control technician. He was diagnosed with multiple sclerosis in 2017, meaning he was automatically regarded as a disabled person under the Equality Act 2010. In spite of a number of adjustments being made to his working arrangements, Mr Miller became progressively less able to carry out his duties due to the demanding physical requirements of the job, not least having to work at height and the increased risk of falling.
After exploring alternative ways of continuing in his employment he asked to be moved to a service administrator position, a role with which he was familiar as it supported his former technical role. His written test scores were too low and his interview unsatisfactory so, as result, he was not offered the job. A capability assessment was subsequently carried out for his role as a pest control technician, following which Rentokil concluded that no further adjustments could be made to enable him to carry out his role and there were no other suitable alternative roles. He was therefore dismissed. Mr Miller brought a claim for unfair dismissal, failure to make reasonable adjustments and disability discrimination on the grounds that Rentokil did not allow him to carry out the administrator role for a trial period.
The ET upheld his claim, noting that offering a trial period and retraining for the service administrator role would have been considered a reasonable adjustment. It also considered that had Mr Miller been offered a trial period, there was at least a 50% chance he would have succeeded and been appointed on a permanent basis.
Rentokil appealed against this decision at the Employment Appeal Tribunal (EAT). Rentokil argued that if an employer reasonably concludes that a candidate is not qualified and/or not suitable for a role, it could not be considered a reasonable adjustment to then appoint them. The EAT dismissed Rentokil’s appeal and upheld the ET’s original decision. The EAT said that “putting the claimant into the service administrator role on a trial basis would have not merely involved postponing the date of his inevitable dismissal by four weeks. It would not be just a short stay of execution, but held out the prospect of the axe being lifted entirely". It was considered that Mr Miller should have been given the opportunity to perform better than his tests suggested he might perform, particularly with the provision of additional training and support.
This case highlights the fundamental importance for employers to not only make reasonable adjustments where a worker or employee is unable to carry out their role due to a disability, but also to allow an individual the benefit of a trial period for potentially suitable alternative roles.
You can read the full EAT judgment by clicking on the link above.
