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April 15, 2016

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Legislation focus: Employment, health and safety legislation changes

Nick Soret, Head of consultancy support, at Natwest Mentor looks at some of the recent changes to health, safety and employment law.

A number of employment law changes have come into force across the UK this month. This comes hot on the heels of new health and safety guidelines introduced earlier this year , all of which employers must be aware of to ensure they are compliant with existing rules.

The National Living Wage (NLW), came into effect from 1 April, entitling those who are over 25 to a minimum wage of £7.20 per hour. It’s vital that employers have now implemented the NLW as those who have not could face criminal proceedings and incur penalties of up to £20,000 for each worker found to have been underpaid.

Further protection for workers on zero hours contracts (ZHCs) has also recently come into force with new regulations preventing the dismissal of a worker for refusing to agree to an exclusivity clause. Additionally the law now allows allow ZHC workers to claim compensation if they’re subjected to any detriment by their employer for breaching an exclusivity clause.

We’ve also seen employment-related legal developments on the issue of holiday pay entitlement. In February, an employment appeal tribunal ruled in favour of a British Gas telesales worker who claimed his holiday pay should include commission that he would have earned during his time off. The ruling confirms previous cases stating that holiday pay should include additional elements, beyond basic pay, that are regularly received by workers. The clear message to employers is to take specific advice on their obligations and options on this issue.

Looking forward, new regulations to help address the pay gap between men and women are expected sometime over the course of 2016. These new rules will require all employers with 250 or more people to publish information on gender pay.

June’s European Union referendum could also have an impact on UK employment laws should the British electorate vote to leave. However, this would unlikely lead to many significant changes in the short term as this will require a large amount of legislative work.

In terms of health and safety, financial penalties for breaches of rules will now be decided on the basis of a company’s turnover and could run as high as £10m for serious infractions and up to £20m or more for larger companies in the event of a fatality. Introduced on 1 February, the new sentencing guidelines apply to all cases heard from that date forward regardless of when the offence was committed. SHP has many articles looking at the new guidelines and how they are starting to take effect.

There have also been tighter rules put in place to protect members of the public from incurring injury from the actions or negligence of a company. If, for example, a member of the public was seriously injured by falling down faulty stairs at a business with an annual turnover of £400,000, the level of culpability could be significant if it had been aware of the fault and failed to rectify it. Under such circumstances, the business could be fined between £150,000 and £350,000, a figure substantially higher than that which would have been imposed prior to 1 February.

To ensure they are compliant with this current health and safety regime, employers should carry out a full and thorough risk assessment of the workplace. While it is neither practical nor expected that all risks can be eliminated, showing that measures have been put in place to reduce and control them will help keep employers on the right side of the legislation. Communicating with employees to ensure they understand any potential risks and how to avoid them is also key to compliance.

Last year, according to Health and Safety Executive figures, 142 people were killed while at work and 102 members of the public died following accidents connected to breaches of workplace health and safety (excluding railway-related incidents). The ultimate test of whether the new guidelines achieve their aim will be dependent on a reduction in these figures.

Nick Soret, Head of consultancy support, at Natwest Mentor

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