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HR & EMPLOYMENT LAW Jackie Le Poidevin, Editor-in-Chief, HR Adviser |
New Fire and Rehire Code of Practice: Your Key Takeaways
After the furore surrounding P&O Ferries’ dismissal of around 800 employees without consultation back in 2022, the Government pledged to introduce a statutory Code of Practice to crack down on ‘fire and rehire’ tactics. It has now published its final version of this Code. Employers who fail to follow the requirements could have to pay higher unfair dismissal awards, so it’s important to understand the correct process to follow when using dismissal and re-engagement to change employees’ contractual terms. We look at your key points to take away from the new version of the Code.
Your Key Points
- After consulting last year on an earlier draft, the Government has now shortened and simplified the Code. However, the process the Code sets out remains largely unchanged.
- The Code applies regardless of the number of employees at risk of dismissal and re-engagement and your reasons for wanting to change their terms and conditions.
- The Code says you should contact Acas for advice before going down the dismissal and re-engagement route.
- If you want to change terms and conditions, you should hold a ‘meaningful consultation’ with employees or their representatives and dismissal and re-engagement should be a ‘last resort’.
- You should provide your workforce or their representatives with as much information as possible about your proposals, ideally in writing, and do this as early as possible. The information should include:
- What the proposed changes are.
- Who will be affected.
- Your business reasons for the proposed changes.
- Your anticipated timings.
- Any other options you’ve considered.
- Your proposed next steps.
- You should consider employees’ views and any reasonable alternative proposals they put forward and try to reach agreement with them. You should re-examine your proposals if any employees oppose them.
- If you change terms and conditions or carry out dismissals, you should ideally offer employees practical support. For example, you might phase in the changes or offer employees relocation assistance or career coaching.
- If you make any changes, you should continue to invite staff feedback and see if you can do anything else to mitigate the impact.
What Happens if You Fail to Follow the Code?
Employees can’t bring a freestanding legal claim if you breach the Code. However, if any employees claim unfair dismissal, the employment tribunals will consider any non-compliance with the requirements when reaching a decision. If you breach the Code and dismiss any employees who refuse to accept the new terms and conditions, those dismissals are therefore more likely to be unfair. The tribunals can also increase any award by up to 25% if you failed to comply with the Code.
What Happens Now?
Parliament still needs to approve the updated Code and the Government then intends to bring it into effect in the summer. We’ll keep you updated so you know when it’s gone live.
If it wins the next election, the Labour Party has vowed to outlaw ‘fire and rehire’ tactics. Its Green Paper, ‘A new deal for working people’, sets out its proposals, albeit not in any detail. These include ‘adapting unfair dismissal and redundancy legislation to prevent workers being dismissed for failing to agree a worse contract’. Whether this would be feasible remains to be seen.
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HEALTH & SAFETY Emma Lampka, Editorial Board Member, Health & Safety Adviser and Risk Assessment & Compliance |
£10k Fine Following Amputation: How to Comply with Your Duties on Work Equipment
The worker, employed by Edwards Engineering (Perth) Limited, had been carrying out maintenance work on a grain dryer at East of Scotland Farmers. He inadvertently placed his hand into the blades of an unguarded rotary fan in the grain dryer. The fan was rotating at 1200 revolutions per minute when it came into contact with the worker’s hand. This led to his little and ring fingers being amputated. He was off work for 7 weeks following the incident. Machinery safety is not just key to engineering organisations but to all organisations from food factories, manufacturing companies and care homes, through to office based businesses.
In this case, Edwards Engineering (Perth) Limited, Glenearn Road, Perth pleaded guilty to breaching Regulation 22 of the Provision and Use of Work Equipment Regulations 1998.
HSE principal inspector Fiona MacNeill said: ‘This incident could so easily have been avoided by simply following a safe working procedure which would have prevented access to dangerous moving parts.’
Work Equipment and Use of Work Equipment
You, or the person responsible for managing risks, need to understand the work equipment used and how it is used. This applies to machinery, appliances, apparatus, tools or installations for use at work (whether exclusively or not) and includes equipment which employees provide for their own use at work.
‘Use of work equipment’ can be very widely interpreted and essentially means any activity involving work equipment. This includes starting, stopping, programming, setting, transporting, repairing, modifying, maintaining, servicing and cleaning.
How You Can Prevent this Type of Incident
If your organisation uses work equipment or is involved in providing work equipment for others to use (e.g. for hire), you must manage the risks from that equipment. The regulations are extensive but specifically regarding this type of incident, this means you must ensure that:
- The equipment is constructed or adapted to be suitable for the purpose it is used or provided for.
- Health and safety risks are recorded when selecting work equipment.
- Work equipment is maintained in an efficient state, in efficient working order and in good repair.
- Maintenance logs are kept up to date.
- Equipment is inspected after installation and before being put into use.
- Equipment is inspected so that faults are detected in good time, especially where work equipment is exposed to deteriorating conditions, liable to result in dangerous situations.
- All people using, supervising or managing the use of work equipment are provided with adequate, clear health and safety information. This will include, where necessary, written instructions on its use and suitable equipment markings and warnings.
- Effective measures are taken to prevent access to dangerous parts of machinery. This will normally be by fixed guarding but where routine access is needed, interlocked guards (sometimes with guard locking) may be needed to stop the movement of dangerous parts. Where this is not possible, such as with the blade of a circular saw, it must be protected as far as possible and a safe system of work used.
- Maintenance operations on work equipment can be carried out safely while the equipment is shut down.
Tips for New Work Equipment
When providing new work equipment for use at work, you must ensure it conforms with the essential requirements of any relevant product supply law (for new machinery, this means the Supply of Machinery (Safety) Regulations 2008. You must check the equipment:
- Has appropriate conformity marking and is labelled with the manufacturer’s details.
- Comes with a Declaration of Conformity.
- Is provided with instructions in English.
- Is free from obvious defects – and that it remains so during its working life.
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PAYROLL Sarah Bradford, Editor-in-Chief, Pay & Benefits Adviser |
Car HMRC U-turn on Double Cab Pick Up Vehicles
The difficulties that might arise when deciding whether a vehicle is a car or a van for benefit in kind purposes recently came to the fore. HMRC has published new guidance in which they announced that double cab pick up (DCPU) vehicles with a payload of 1 tonne or more would be treated as cars not vans from 1 July 2024. The change of policy followed on from the decision in Payne & Ors v HMRC [2020] EWCA Civ 889 in which the Court of Appeal found that modified vehicles with a second row of seats behind the driver’s seat were cars not vans.
As the tax regime for company vans is generally more favourable than for company cars, this policy change would have led to higher tax bills for employees with DCUPs as a company vehicle. However, having listened to representations from farmers and the motor industry, HMRC withdrew the new guidance only a week later, reverting back to the existing rules.
Car or Van?
The tax legislation defines a car’ and a ‘van’ for the purposes of the benefit in kind legislation. Broadly, the distinction comes down to whether the vehicle is a goods vehicle or not – a van is and a car isn’t. A goods vehicle is ‘a vehicle of a construction primarily suited to the conveyance of goods or burden of any description.’
DCPUs
In their guidance, HMRC define a DCPU as a vehicle which normally has:
- A front passenger cab that contains a second row of seats and is capable of seating around four passengers in addition to the driver.
- Four doors which are capable of being opened independently, regardless of whether the rear doors are hinged at the front or at the rear,
- An uncovered pick up area behind the passenger cab.
Since April 2022, when deciding whether DCPUs are cars or vans, HMRC have interpreted the legislation in line with the definitions that are used for VAT purposes. Under this approach, they accept that a DCPU with a payload of 1 tonne (1,000kg) or more is regarded as van for the purposes of the benefits in kind legislation. Payload is the gross vehicle weight (or design weight) less unoccupied kerb weight.
By contrast, a DCUP with a payload of less than 1 tonne is regarded as a car, and taxed under the company car tax rules where it available for an employee’s private use.
Where are We Now?
The status quo has been maintained, such that DCUPs with a payload of less than 1 tonne are treated as cars and taxed under the company car tax rules, whereas DCUPs with a payload of 1 tonne or more are regarded as goods vehicles and taxed in accordance with the rules for company vans.
Consequently, where an employee is provided with a DCUP as a company vehicle that is available for their private use, it is important to be aware of the payload so that you can determine whether it should be taxed as a company car or a company van.