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Employment Update for Small Businesses
April 2009
Dear Mike,
 
This month I am providing you with a few practical tips for dealing with common employment issues.  Holidays have become more problematic since the increase in the statutory entitlement.  A few simple changes can help you manage them better.  Dealing with low level misconduct and underperformance is always an unpopular task for people managers; read on for a few tips.  Finally, a reminder of the importance of documenting formal disciplinary matters - it can be costly to get it wrong.
 
STOP PRESS - budget news - an uplift in statutory redundancy payments. (See below)

Please contact me if you would like to find out a bit more about these issues.  If you need any help or advice why not take advantage of my free initial consultation.
 
Please forward this email to any of your contacts who might find it of benefit. 
 
Holly
Regards
 
Peter Etherington
Tel: 01664 430373
Can you afford to make redundancies?
Budget 2009 - Statutory Redundancy Pay is to be increased
Alistair Darling has just delivered his much anticipated budget and no doubt the increase in fuel and alcohol duties will get the normal high level of attention in the press.  Employers, however, are likely to be more interested to learn that the current statutory cap on a week's pay that is used in redundancy pay calculations will be increased from £350 to £380 (it only increased from £330 to £350 in February).
 
So far we have not been given a timescale for this change.  It is possible that he may just have been announcing next February's increase particularly early.  Watch this bulletin for more information.
Struggling with the new holiday entitlement?
The increase in statutory holiday causes some confusion
From 1 April 2009 the statutory minimum holiday entitlement was increased from 4.8 weeks to 5.6 weeks per annum (inclusive of bank holidays).  For someone working 5 days each week, this means an increase from 24 to 28 days.

Many employers have found that it has become harder to calculate holiday entitlement for part-time staff under the new rules, and in many cases I now advocate converting holiday entitlement into working hours for the purpose of recording it. 

For instance, someone working 3 hours on a Monday and 4 hours on both Tuesday and Wednesday each week (11 hours in total) is entitled to 5.6 weeks' holiday in the year.  That equates to an annual entitlement of 61.6 hours.  I would recommend that at the start of the year, the holiday booking form is completed with 61.6 hours as the starting point.  Any bank holidays that fall on the employee's normal working days should be recorded on the form and either 3 hours or 4 hours deducted from the running total (depending on which day of the week the bank holiday falls).  This leaves the total hours of holiday left for the employee to book in the normal way.  If they then want to book off a Monday, 3 hours is deducted from their running total.

Some employers still state holidays in their written statements of employment in these terms: 4 weeks plus any bank holidays that fall on normal working days.  This may now cause you some problems when it comes to part-time staff (particularly if they don't normally work on Mondays or Fridays, which are the most common bank holidays).  It is advisable to review this wording and, if necessary, agree new terms and conditions with staff.

If you don't currently have any part-time staff, then I suggest now is the time to adjust your terms and conditions to make holidays more manageable in case you take some on in future.
Are you shying away from tackling difficult employees?
Practical tips for conducting those difficult meetings
From time to time employers will find that an employee is not performing to the required standard. Sometimes this may be a temporary issue which is perhaps related to an illness or some problem in their private life and will naturally resolve itself.  However, occasionally you may find that more direct action is required.

I often find that employers are not sure how to raise these issues with employees and feel that they are going to end up in a confrontation.  Whilst it is never easy, there are a few practical tips that you can follow that should help.

Start out by telling the employee that you want to talk about their performance as you have some concerns.  Reassure them that this is an informal meeting and you intend merely having a talk with them to try to address some of your concerns.  Make sure you have somewhere private to talk to them where you will be free from interruptions.

Raise the issues in terms of what you have observed without attaching any blame.  For example, if someone working in a shop continually records sales under a miscellaneous code, rather than assigning correct product codes, it may be better to say something like: "I noticed yesterday that you sold some printer cartridges and paper but recorded them as miscellaneous rather than stationery.  Why was that?" instead of "You ignore our sales procedures and keep recording items wrongly, that has to stop".  It may be a subtle difference but can have a dramatic effect on the way the employee responds.  In the first case you are just stating what you have seen and asking them to explain; in the second case you are accusing them and immediately putting them on the defensive.

In cases of misconduct it is better to talk about the particular behaviour that is causing you concern rather than labelling the employee.  For instance, if someone is continuously bad-tempered at work and upsetting other employees, you may want to consider saying something like: "I noticed that you spoke quite harshly to Ann yesterday when she asked if you could help her to get the post ready to go.  She looked put out and was obviously upset.  Did you realise that she was upset?"  Sometimes it can be tempting to say something like: "Why were you bullying Ann yesterday when she was only asking for help?" 

It is always best to use specific examples - things you have observed yourself wherever possible - rather than talking in generalities.  So in the bad-tempered employee example, above, you wouldn't want to say something like "You are always angry and aggressive when dealing with colleagues", as the employee is likely to challenge such a sweeping statement and react angrily.  You are also less likely to maintain your credibility if you then find you cannot come up with a specific example when challenged.
Are you complying with the new Acas Code?
The new Code brings in a subtle but important change
As I reported in March's newsletter, a new Acas Code of Practice on Disciplinary and Grievance Procedures came into effect from 6 April 2009.  Whilst in many respects it is lighter touch than the previous code, there is one interesting addition which employers need to note.

Employees have the statutory right to be accompanied at disciplinary meetings and employers have to allow them to exercise that right.  However, until now the employer has not had a duty to inform employees of this right.  The new Acas Code, however, states that employers should inform employees of the right to be accompanied in the written notification of the disciplinary hearing. 

As failure to comply with the Acas Code could result in an uplift in tribunal awards of up to 25%, employers need to ensure they comply with this aspect in order to help minimise their risks.

Peter Etherington Employment Law Services