Matthew Pinto-Chilcott, Owner of Consensus HR comments: “Groom v Samuel Smith Old Brewery . With Christmas now not far away, when I saw this recent article written by our Chartered Institute (CIPD), it seemed fit to write about it and one of the most common claims to an Employment Tribunal (ET), ‘Unauthorised deductions from wages. In this instance it involved a pub and its management team and a clause within their Contract that stated monies could be deducted from their wages for loss of stock etc. However, as with always, the word ‘Reasonable’ raises its head and is very important that all business owners and their management team when making decisions ensure they look at the facts and fully consider if it reasonable to take the action. In this case, it was found not to be reasonable, and this article explains why. HR is under Civil Law and the balance of probabilities and hence why you always need to be able to demonstrate that the action you took was reasonable.”
In this case the ET was called upon to consider if deductions made under a contract were lawful; and if not, in making those deductions, had the respondent acted in a manner calculated or likely to destroy the relationship of trust and confidence between employer and employee.
The facts behind the case were that a married couple took over the running of a pub from May 2019, following a period where one of them worked as relief manager in the same pub. On the day before both taking over, a stock take was undertaken by a representative of the respondent. Upon finding a deficiency in the stock, allegedly from the claimant’s time as relief manager, the claimants were forced to make up for this out of their own pocket, to a total of £480 or thereabouts. The payment of this was presented as an ultimatum; if the money were not paid over, they would not be able to take up their joint contractual position as managers.
On two further occasions deductions of £428 and £565 were made in line with this clause. These were not challenged. Finally, following another stock take the owner notified the claimants that they would deduct £4361.54 from their joint salary due to gaps in stock levels, this amounted to 12.5% of their net salary (which was only slightly above national minimum wage anyway).
The amounts calculated as deductions were based on a contractual clause and a relevant policy. These set out that the total sum owing was based on calculations as to how much surplus should have been created in an average pub in terms of beer and mixer drinks (as the head on the beer, or ice in a glass with a mixer, meant less liquid was served than sold), against the actual stock levels in the pub. If the actual stock levels were less than the 6% surplus the respondent said should be present, based on what been sold, then the clause allowed for the deficit to be taken from the salary of the claimants. This check could happen at a time arbitrarily picked for stock check. This therefore meant that any surplus previously recorded, where the pub held drinks over the calculated surplus, would not be taken into account, even if overall it meant that there was not a deficiency.
The deductions took place whilst the claimants were on annual leave, and they submitted their resignation on their return by letter, stating that this amounted to constructive dismissal because of a fundamental breach of contract. Specifically, that is the breach of trust and confidence. At that point they gave their contractual two weeks’ notice, but following further communication from the respondent’s representative, they withdrew that notice and resigned with immediate effect.
Claims were then made for constructive unfair dismissal and unlawful deduction of wages.
Whilst only ET, and therefore not binding precedent, this case is an important reminder for employers to take care when drafting deductions clauses. The clauses relied on in this case were not sufficient so as to result in a reasonable calculation of the employer’s loss, and therefore were not reasonable to enforce. Employers should instead be explicitly clear what is meant by a deficit and set out the means of calculating this.
A further note is that even where a valid deduction clause is in place, employers must have in mind the impact of the deduction on the individual, especially if the employee is a low earner and the amount is significant. At 12.5% of their wages, the amount deducted by the respondent represented a significant portion of their joint income, which could have had serious consequences for the claimants. This drew criticism from the ET and led them to question the validity of such a deduction. Ultimately it contributed to the successful constructive dismissal claim and is a reminder of the need to be reasonable when exercising contractual clauses.
13(1A) of the Employment Rights Act 1996 – Right not to suffer unauthorised deductions.
(1) An employer shall not make a deduction from wages of a worker employed by him unless—
(a)the deduction is required or authorised to be made by virtue of a statutory provision or a relevant provision of the worker’s contract, or
(b)the worker has previously signified in writing his agreement or consent to the making of the deduction.
(2) In this section “relevant provision”, in relation to a worker’s contract, means a provision of the contract comprised—
(a)in one or more written terms of the contract of which the employer has given the worker a copy on an occasion prior to the employer making the deduction in question, or
(b)in one or more terms of the contract (whether express or implied and, if express, whether oral or in writing) the existence and effect, or combined effect, of which in relation to the worker the employer has notified to the worker in writing on such an occasion
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “This is an interesting idea by the work and pensions secretary – Mel Stride, on how to get the economically inactive back to work. It will be interesting to see what people’s views are on this idea. We find the main problem now is getting medical advice as access to GP’s is extremely hard for all and especially when we try to get medical reports and, on many occasions, the GP in the surgery is a locum with minimal knowledge of the history of the employee. However, using a good Occupational Health provider and with the detailed information required such as a copy of their Job Description and the issues they are currently experiencing, together with the employees’ consent, we have been able to get some very good back to work plans with any reasonable adjustments mentioned and whether in their opinion they may be covered under current Employment Law legislation. This has resulted in many employees returning to the workplace.
Employers / line managers should actively encourage their teams to take their breaks and away from their computers and desks and if possible, in the fresh air on a regular basis. However, we all know it is easier said than done and I personally admit to this and need to practice what I preach as on too many occasions, I have continued to stay at the computer / desk when I should have spent some time away.
At Consensus HR we always encourage our clients, employers, and line managers to ensure that a constructive record is kept of an employee’s sickness and holidays, so that the appropriate action can be taken, if needed, as through this, a reasonable relationship can be achieved for the benefit of the employee and the business as these records tend to get filed and forgotten. We also encourage the use of a user-friendly IT system that can retain the data and keep a comprehensive record should it ever be needed by the employee or business to demonstrate the frequency / time taken for holiday or sickness. Business owners and Managers through the use of these systems and managing can make a big difference.
Ministers are considering plans to offer tax breaks to companies that take greater responsibility for the health of their workers in a bid to reduce the number of people quitting the labour force. Work and Pensions Secretary Mel Stride is leading an internal review into how to get many of the 9m people classed as economically inactive back to work. Ministers are looking at how large firms can be encouraged to take on more responsibility for treating conditions that keep people from working, a move that would alleviate pressure on the NHS. Employment Minister Guy Opperman said he feels there is a role for “employers to address some of the ongoing management around day-to-day difficulties,” noting the possibility of offering a tax break “to incentivise them to do more.”
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “What are your views on this? As previously commented, I find it works both ways and as long as your team have the correct tools to do the job such as IT, telephone access etc, the workforce should be more flexible. This, however, needs to be managed correctly and trust put in your team to work productively and professionally or else, as this article from the BBC comments and as some companies expect, employees will have to return to work in the office five days a week! Personally., I cannot say this is easy to achieve in a work environment where you have become accustomed to the team being in the office all the time during work hours but do believe it is the way forward in business sectors that can accommodate it. Unfortunately, many business sectors will never be able to offer it as an option such as retail and hospitalities but as reports / news articles show, many workers prefer to stick to the ‘old’ way and return to the office and companies will need to reflect on what, if any effects it has on retention within the team.. Let’s wait to see what the overall consensus is once we are back to normal! Whatever the new ‘normal’ is?
Employers are finding that staff remain resistant to returning to the office and some are willing to quit rather than go back to the workplace, reports the BBC. Despite nearly two-thirds of workers saying they are more productive in a hybrid or remote work environment, a third of companies in the UK are planning to cut back on flexible working in the coming months, according to a poll by LinkedIn. Chantelle Brown, who works for the UK recruitment company Latte, says companies who expect staff to work five days a week in the office risk losing out on talent. But if, as many predict, the UK enters a protracted recession and competition for talent weakens, companies may find it easier to demand a return to the office.
Matthew Pinto-Chilcott of Consensus HR comments: “Following our numerous previous Health & Safety (H&S)j Emails, the Health & Safety Executive (HSE) have produced some more great user friendly tools in relation to two more key H&S areas, Preventing stress at work and ensuring you know the COSHH essentials. Businesses always need to ensure that they are at the forefront of HR and People Welfare and their duty under the Health & Safety at Work Act 1974 and these free H&S tools are a way to achieve this. Details and links for all these can be seen below and on the HSE website.
According to the latest statistics (PDF) there were 914,000 workers suffering from work-related stress, depression or
anxiety in 2021/22. 17 million working days were lost due to stress in this period.
HSE’s stress website has plenty of advice and includes examples of stress risk assessments tailored to different business sizes, as well as case studies and much more. The stress talking toolkit shows how line managers can have simple, practical conversations with employees to help prevent stress at work.
Our Working Minds campaign aims to prevent work-related stress and encourage good mental health.
If you work with hazardous substances, our COSHH website can help you understand the actions you should take to stay healthy.
Our publication Working with substances hazardous to health: A brief guide to COSHH is available to download. It explains how to control exposure and comply with the Regulations.
HSE’s COSHH Safe Handling Chemicals poster also provides crucial guidance on how to handle chemicals safely in your workplace, including Do’s and Don’ts and a useful hazardous signs check.
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “Unfortunately, this is not the greatest of news just before Christmas 2022 and the New Year 2023 but really does continue to emphasise the difficulties that businesses are continuing to experience to remain in business.
At Consensus HR, we see businesses from all spectrums of the Employee Life Cycle, when the country and economy is booming, recruitment increases and when it is not, redundancies / company restructures take place, and it is in these instances together with employee relations and development of the team that we are called upon for support. If your business is having to consider changes with its team, we highly suggest for the welfare and motivation of the team and customer service / sales that you contact a HR Consultancy to support you and help make an extremely difficult business decision completed to best practice and the law.”
Company insolvencies in November were 21% up on the same month last year and 35% higher than in 2019 – the last pre-pandemic November. The Insolvency Service data show that there were 2,029 registered company insolvencies last month. Of these, 1,595 were creditor voluntary liquidations. The analysis also reveals that there were five times as many compulsory liquidations last month than in November 2021, with a 7% increase on November 2019. The Insolvency Service said compulsory liquidations had increased from historic lows during the pandemic, partly as a result of an increase in winding-up petitions presented by HMRC. Christina Fitzgerald, president of insolvency and restructuring trade body R3, said: “What we’re seeing here is a perfect storm of creditors pursuing unpaid debts and directors choosing to close down their businesses — either before this choice is taken away from them or because they have simply run out of road.” David Kelly, Head of Insolvency at PwC, said: “This is a sobering reminder that rising interest rates, energy costs and supply chain issues are starting to bite as we head into 2023.”
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “Well, we knew this was coming and this is the first of what I expect will be many cases in relation to Covid and any dismissal that took place during this time. As we all know, the rules during the Covid period were changing continually with who could claim payment and who could not and could you use a Covid payment as part of their notice pay, to name just a few! This case has now demonstrated that it was fair to dismiss care workers for turning down the Covid vaccine due to the companies ‘legitimate aim” and not due to their spiritual and philosophical beliefs and that any interference with human rights in this case was proportionate. We wait to see how many more cases rear their heads and what the outcome of those are now that they are appearing at Employment Tribunals.”
In what is believed to be the first published case of its kind, an employment tribunal in Leeds has decided that care home bosses acted fairly when they fired several members of staff for turning down the Covid vaccine. Barchester Healthcare dismissed five healthcare workers for declining Covid-19 vaccinations without any medical exemption. The workers complained they turned down the vaccine due to their spiritual and philosophical beliefs, but a judge ruled the firm had the “legitimate aim” of “minimising the risk of death and serious illness” among residents and staff, and that such a move was “necessary in a democratic society.” Employment judge Neil Maidment recognised that the reason for sacking the workers, while “unusual,” was “genuine and substantial” and said the company “believed its policy of (subject to medical exemption) only employing vaccinated care home staff would save lives.” He said: “The tribunal concludes that any interference with human rights in the circumstances of this case was proportionate.”
Daily Mail
The Times
Matthew Pinto-Chilcott, Owner of Consensus HR comments: “This is an area within business you hope as a manager you will never have to deal with but unfortunately there are the odd times when things go missing or you note a product that you sale has not shown up as being sold but has now disappeared.
As we continually say, we must never make assumptions and this is where a thorough investigation must take place in relation to the allegation being made, – Theft. Theft is classed as Gross Misconduct and can result in the immediate dismissal of an employee, but the ACAS Code of Practice MUST be followed at all times. Whoever is contemplating acting needs to ensure that the companies (ACAS) Policies and Procedures are followed, and the employee always treated reasonably with an initial letter inviting them to an Investigation meeting, clearly stating the grounds (Allegation) the meeting is being conducted for.
I remember having to do this in the past, when working for a well known retailer and it was not the most pleasant experience as the employee involved was an extremely valued, long serving, customer focused member of the team. However, upon investigating and using the technology we had we could see that she was stealing money from the till and not entering the correct products. Upon fully investigating we found that she had additional monies in her locker when company policy was that no employee should have more than £10 cash on them at any one time and which it was claimed was church monies. After further investigating and gaining more facts and information she was dismissed for Gross Misconduct – Theft and given the right to appeal.
This incident went all the way through the Employment Tribunal (ET) process with it eventually ending up in the Employment Tribunal Appeal in London. Thankfully by taking the correct reasonable action and being able to demonstrate that we had been reasonable throughout and followed the ACAS / company Policy / Procedures with a thorough investigations, we won! It should be noted though, that it is not an easy process and companies need to ensure that they dot the ‘I’s” and cross the “T’s” when it comes to their HR Policies and Procedures.
Stealing is classed as an act of Gross Misconduct which can result in instant dismissal from the company. However, companies must ensure that they follow the Correct ACAS Disciplinary and Grievance procedure in any alleged event or the consequences to a company can be drastic.
The procedure consists of a number of set processes starting initially with a thorough investigation into the allegation, which in this instance is theft. Upon completion of this, the correct further action needs to be taken and a decision made by the appropriate manager.
In this instance, if it was proven then the employee would be dismissed immediately for Gross Misconduct, Theft, but the employer needs to be able to demonstrate that the action they have taken is reasonable under Civil Law and the correct process / law has been followed correctly.
Failure to follow the correct process could result in high awards for unfair dismissal, amongst others, if proven.
Matthew Pinto-Chilcott, Owner of Consensus HR comments: – Workers stressed over cost-of-living crisis. With this latest news article within The Guardian, it can hardly be surprising for business owners and managers during these very difficult times that the cost of living is affecting the team’s performance when at work. Unfortunately, this is an economical problem that does not seem to have an end in the foreseeable future and really emphasises the need for productive, best practice, HR, and Line Management. We all need to ensure that we work to our companies HR Policies & Procedures and maintain a consistent, legal, and reasonable approach to all matters of concern such as sick leave, stress, and anxiety to name a few. As discussed in one of our previous blogs, we have seen a huge increase in the requests for advice on sickness and medical reports and we are not the medical professionals and hence must seek their advice / support for the best outcome for the business and employee.
A survey by the Chartered Management Institute (CMI) has found that workers in the UK are becoming so anxious about the cost-of-living crisis that it is affecting their performance at work, with two-thirds of managers reporting issues such as rising absenteeism and lack of engagement among stressed-out staff. The survey of more than 1,000 managers and team leaders revealed that 71% had seen evidence of the crisis increasing stress and anxiety for their teams. Some 41% of the respondents highlighted “more distraction, less focus and attention to detail,” 33% noted increased sick leave of absence and 31% observed a reluctance to take on extra work. “We were very surprised at the extent to which there were these very visible knock-on effects,” said the CMI’s director of policy, Anthony Painter. “There seems to be a sort of bandwidth issue, where people are facing extreme money worries, and that’s narrowing their field of vision, their ability to do their work well.”
Matthew Pinto-Chilcott, Owner of Consensus HR comments: Job vacancies slow amid fears for the economy – “We have found lately when dealing with recruitment for clients that meeting the specific needs of them is becoming more complicated and specific with employers now wishing to have the ideal dream candidate. We all want the perfect qualified, work experience and knowledgeable employee but businesses need to ensure that their recruitment strategies meet the needs of the business and the appropriate action taken. Job Applicants are now having the opportunity to be picky on what jobs they apply for and as this article states, job vacancies have fallen to its lowest level in nearly two years. Your business needs to ensure that its HR and business strategies make employees want to come to work and that you are an employer of choice despite the current financial constraints imposed upon you due to the current economic climate. Retention of employees is vital to any business but also allowing employees to move on to pastures new, is also vital for businesses to ensure a flow of new blood and that your employees do not become clones that do not think outside the box! The main thing for any business is to know that when somebody does leave your company that they are leaving for a positive reason and will remember their employment with you in a positive way, although which can sometimes be hard”
Growth in job vacancies fell to its lowest level in nearly two years in November as economic uncertainty led businesses to scale back hiring. The latest recruiter survey by KPMG and the Recruitment and Employment Confederation shows the rate of inflation in wages for new starters as well as temporary employees fell to its lowest level in a year and a half despite inflation being in double digits. Neil Carberry, chief executive of the confederation, said the latest results did not indicate that there had been a major slowdown in hiring. “While permanent recruitment activity has dropped from the very high levels of earlier in the year, the pace of that drop has tempered this month,” he said. Claire Warnes, partner at KPMG UK, warned that wage growth may fall in the coming months as employers cut back on plans to recruit new workers and employees stay put to maintain their job security.
Matthew Pinto-Chilcott, Owner of Consensus HR comments: – PM working on ‘tough’ new anti-strike laws “I do not know what your views are in relation to the current state of the economy and many public sector provisions taking strike action but this latest news that has been broadcasted and written in a number of papers explains what action the Government is aiming to take in the future. The current economy with high inflation and the war in Ukraine and high gas / electricity prices is something very unusual to me, having not experienced it in the past but it highlights the importance of employee relationships and the need for all parties to be reasonable and to take reasonable action. Running a business / service is never easy and having employees / team has complications as well. In these instances, it is easy for us to have our say / point of view but as with all HR and business in general, unless you know the facts and have all the information in front of you, you are not able to claim that your view is correct and reasonable! Also, depending on who’s view you listen to, whether this be the Government or the Unions, you will have your stance but we need to remember negotiation and best practice HR within your company can help to ensure that issues such as these are kept to a minimum and members of the team made to feel part of the business and the decisions that are made and fully understand why they are being made and that their views matter”
Rishi Sunak said on Wednesday that he would bring in “new tough laws” to protect people from strike disruption. He told MPs that if “union leaders continue to be unreasonable, then it is my duty to take action to protect the lives and livelihoods of the British public.” The Prime Minister’s pledge came as the PCS union said Border Force staff would join a wave of strikes this Christmas. A bill has been introduced to Parliament which would ensure minimum service levels on transport networks during strikes, but it is yet to be debated by MPs and peers. Downing Street said the legislation would be extended to other services but would not specify what these would be, and no timescale was given. Meanwhile, the Labour Party has said it will repeal the 2016 Trade Union Act if it comes to power, making it easier for unions to take industrial action. Elsewhere, senior military figures have told the government that Armed Forces personnel should not have to sacrifice their Christmas to cover for striking public sector workers who earn more than them. Bringing in soldiers also risks weakening the “operational capability” of the military to respond to threats, ministers were told.
Matthew Pinto-Chilcott, owner of Consensus HR comments: – Number of young people making disability claims triples in a year “These statistics do not surprise me at all as we have seen a surge in our clients asking for support in relation to sickness and mental health. This is an area as with many areas covered under HR that needs to be managed correctly for the benefit of the employee and business and the correct legal and best practice action taken. Employers / Line managers need to ensure that consent is obtained from the employee and then the correct action taken such as arranging a meeting with the employee and discussing the issue and how we can seek support / medical advice to identify if any reasonable adjustments are needed and if they believe they may be covered by the Equality Act 2010 and one of the protected characteristics. Assumptions should never be made, or the incorrect support offered as we are not the medical professionals and in these difficult times of gaining access to a GP, a company may have no option but to go to an Occupational Health professional for support.”
The number of people on disability or sickness benefits has doubled in a year – and tripled among teenagers – with 60% of those off work due to illness living with mental health problems. According to the Institute for Fiscal Studies, younger claimants were more likely to be suffering with mental ill-health – with 70% of under 22s reporting mental or behavioural disabilities, compared with 20% of those aged 55 or over. A separate report from the Institute for Public Policy Research found that six in ten people off work because of long-term sickness are living with a mental health problem.
