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Dear Mike,
This month I have focussed on two issues that are of importance to many small employers. Most small businesses rely on good staff being prepared to work hard and to sometimes put in long hours. If this sounds like you, then you will no doubt be interested to read about changes to the European Working Time Directive which will restrict further the number of hours your staff can work.
Some small businesses can suffer badly when strong competition arrives in their local area or if their innovative new product is copied before they have managed to get it to market. Read on to find out how you can protect your business against your greatest asset and your greatest liability - your own staff!
Please note that there will be no newsletter in July as employment news tends to reduce over the summer.
Please contact me if you would like any more information about any of these news items. 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.
Regards
Peter Etherington  Tel: 01664 430373
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| Further restrictions on working time? |
| Forthcoming amendments to the EU Working Time Directive |
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Ever since the Working Time Regulations became law in 1998, employers have been able to ask their employees to opt-out of the maximum working week of 48 hours. Where employees are hourly paid, this has normally proved relatively straight-forward to achieve as the majority of employees are willing to work longer hours as long as they are paid for them. However, over the last 10 years there has been a steady stream of challenges in the EU to the UK's position regarding the opt-out (which few other member states replicate).
The latest agreement reached in the EU recently on this issue is that the opt-out may remain in UK law but there must be an absolute limit of 60 hours per week unless the social partners (i.e. the TUC, CBI and Government) agree otherwise. In addition there has been some clarification of on-call time and when it should be treated as "working time" in law. Active on-call time is to be classed as "working time" and inactive on-call time may or may not be classed as "working time" depending on what the social partners agree.
There is clearly still some clarification needed and the Directive is some way from being rolled out. Each member state (including the UK) will then need to bring in its own national law. Bear in mind, however, that the 48 hour limit under the Working Time Regulations is in respect of the average number of hours worked over a 17-week period. In other words, as an employer you do not need to be unduly concerned if your employees work longer than 48 hours on occasion rather than on a regular basis.
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| Do you place too much trust in your staff? |
| Restrictive covenants are essential tools for protection of your business |
| I have been working with a number of businesses this month which are very keen to ensure that employees cannot leave and set up in competition or use their inside knowledge to benefit an existing competitor. This is an issue with huge importance for a very wide range of businesses - from hairdressers, whose clients tend to have a favourite stylist (who they may be tempted to follow if they set up next door), to firms dealing in new technologies who are keen to ensure that any inventions created on their time and at their expense remain their property.
The best way of protecting your business against staff competing or pinching valuable information, is to ensure that they sign a contract before starting work for you which contains well drafted restrictive covenants. The law will uphold restrictive covenants which aim to stop employees who leave your firm setting up in business, passing information to competitors, poaching clients or staff, and using your "intellectual property". However, the courts will only uphold them if they only go as far as is absolutely necessary in order to protect your legitimate business interests and if they do not stop your ex-employees from being able to earn a living.
Many employers have failed in their bid to uphold restrictive covenants when they have tried to use "off the shelf" ones or have tried to draft their own. If the period of restriction is too long, the geographical area within which competition is restricted too large, or if a senior manager has the same restrictive covenants in his or her contract as a low-level employee, then they are unlikely to be upheld.
I would certainly advise having your restrictive covenants drafted and regularly reviewed by an employment law professional as an investment and insurance against substantial potential losses. |
