Month: May 2018

New rights for all workers to itemised payslips will make payment more transparent and understandable

Payslips for all employees has been a legal requirement since the Employment Rights Act 1996 where a number of particulars were named as being required on all payslips. These include:

• The gross amount of wages or salary
• The amounts of any variable, fixed or other, deductions from that gross amount and the purposes for which these are made
• The net amount of wages or salary payable
• The method of payment

In February 2018, two new Orders were placed before Parliament which are set to change the requirements of information on payslips based on the contents of The Taylor Review, published in July 2017, in which recommendations were made to increase the rights of workers. The Orders placed before Parliament follow the recent response from the government to this Review, which, amongst other items, confirmed that they would be introducing legislation to extend the right to receive a payslip to all workers. This all-encompassing ‘workers’ umbrella includes those on casual and zero-hours contracts.

Changes to itemised payslips due to become lawful on 6^th April 2019

Both Orders are due to come into force on the 6^th April 2019. The first of these, passed on the 25^th April 2018, named The Employment Right Act 1996 (itemised Pay Statement) (Amendment) Order 2018, will change the information required on an itemised payslip. The goal of the reform is that workers will have a clearer understanding of their pay, especially those who work varied hours which results in changeable pay, differing from period to period. The change will require payslips to state the number of hours that are being paid at which pay level, where pay varies dependent upon number of hours worked. This can either be shown as a summative number of hours worked, or as a breakdown for different types of work or rates of pay.

The second Order, named The Employment Right Act 1996 (itemised Pay Statement) (Amendment) (No. 2) Order 2018 will bring into force the government’s commitment, recently, to providing all workers, with written, itemised payslips- not just employees. This extension of rights to all workers enables all those in receiving payment to enforce their right to an itemised payslip in the Employment Tribunal.

The basis of these changes is, in particular, to provide transparency to the lower paid work force who will, from April 2019 onwards, be able to highlight incorrect payment structures and mistakes on payments.  There will also be a clearer ability to recognise if workers are not being paid correctly and in line with the Living Wage, as set out through the government’s proposal of transparency on pay for workers.

Does your business require support with the changes to The Employment Right Act 1996 (itemised Pay Statement) (Amendment)?

In light of these recent Orders, all employers with employees or workers who will also require itemised payslips, or changes to their existing payslips, should begin to review their pay statement practices. The new rules will apply to all work, or periods of work, which commence after the 6^th April 2019.

If your business requires support through the imminent changes to itemised payslips, or for any other aspects of employment law, in the first instance, please contact Vaishali Thakerar at our Leicester office on 0116 212 1000 or by email to vthakerar@lawson-west.co.uk

The Government have recently stated that they will actively contact all potential claimants who are yet to request a refund on Employment Tribunal fees paid out during the 4-year period from July 2013.

The Employment Tribunal refund scheme opened on the 16^th November 2017. The scheme enabled those who were charged fees to take a tribunal to court between the 29^th July 2013 and 26^th July 2017 to apply for a refund.

Employment Tribunal fees were introduced by the Ministry of Justice’ then Lord Chancellor Chris Grayling, in July 2013. Charges began at £160 and increased to between £230 and £950 for further hearings. Some claimants were required to pay up to £1,200. Since inception, trade union Unison challenged the fees, through all levels of the justice system, culminating in a landmark Supreme Court ruling, which last year, outlawed the fees. The fees were found to be unlawful on the grounds that it prevented access to justice and was ‘indirectly discriminatory on the grounds of sex.’

Dramatic fall in volume of claims after Employment Tribunal fees were introduced 

Unison reported that there was a ‘dramatic and persistent’ fall in the number of claims after the fees were introduced- over 70% in litigation cases, with the decline more apparent in lower value or non-monetary claims.

In October 2017, 1000 claimants completed a refund application in order to test the system. Once successfully completed, the applications were opened to all those who had been charged a fee during the circa 4 years of existence. 

It was expected that hundreds of thousands of claims would be received with an estimated refunds cost of £33m, to include 0.5% interest. In December 2017, soon after the scheme launch, the former Ministry of Justice member, Dominic Raab suggested that the government would not write to potential claimants as ‘often people moved home’. At this point, 3,400 payments had been made, with a value of £2.8m, only 8.5% of the expected full amount of due refunds.

Further action is necessary to reach ALL potential claimants 

Until recently, the government had relied upon the information being displayed on government channels such as the gov.uk website. However, in a letter to the House of Commons Justice Committee, published in early May 2018, Justice Secretary David Gauke stated that the refund scheme was making ‘reasonable progress’ but that ‘further action was necessary’. He continued by stating that ‘We are therefore writing over the next few months to everyone who paid an ET fee, but who has not yet applied for a refund, to raise awareness of the existence of the scheme, and providing details on how to apply’.

The first 2,000 letters are reported to have been sent on the 9^th April.

The refunds are available for anyone who brought a claim personally and paid fees on their own behalf, or anyone who paid a fee on someone else’s behalf- such as a trade union or insurance company. Additionally, the fee refund will be available for any organisation ordered during the Tribunal proceedings to pay a claimant’s fees.

The letter from Mr Gauke continues to state that the government has incurred legal fees in access of £305,000 during the dispute with further costs expected to settle the costs incurred by Unison which the Supreme Court ordered to be paid. With wider implications to the way courts and tribunals are funded, the Ministry of Justice continues to seek legal advice.

Individuals who paid directly for their own fees who believe they are eligible for a refund in Employment Tribunal fees, should make their application online, as long as they have not changed name since the claim, the claim was brought against a single employer and the claimant has a UK bank account. Should you require assistance with this Lawson West are able to assist.

Do you require support for an employment issue?  

If you require any support through an employment issue, are looking for advice or believe you have grounds for an Employment Tribunal claim, in the first instance contact our employment team on 0116 212 1000 or 018585 445480 for a free initial consultation, during which we will be able to suggest the most appropriate course of action for your situation. Alternatively complete our contact form and we will contact you directly.