This year the National Minimum Wage (NMW) celebrated its 10th birthday.

The NMW came into force on April 1, 1999 and from that date, most workers aged 18 or over were entitled by law to a national minimum hourly wage, regardless of where they worked, the size of the firm or the occupation.

The NMW was extended to workers aged 16 and 17 from October 1, 2004. When it was first launched the main rate of NMW was £3.60 per hour.

The current rates of NMW which apply until October 2009 are £3.53 for 16 and 17 year olds, £4.77 for 18 to 21 year olds and £5.73 for those aged 22 and over. The Low Pay Commission (LPC) has made a number of recommendations on the NMW in a recent report. The LPC recommendation for a rates increase in October 2009 has been accepted by the Government.

From October 1, 2009 the NMW rate for 16 and 17 year olds will increase to £3.57 per hour, for 18-21 year olds will be £4.83 per hour and for those aged 22 and over will be £5.80 per hour.

The Government has also accepted an LPC recommendation that the adult rate of the minimum wage should be extended to 21-year-olds. This will be implemented from October 2010.

The Government has also announced that using tips to make up staff pay to minimum wage levels will also be outlawed from October 2009. Under rules in place since the introduction of the NMW where tips and gratuities are given directly to a worker such as a waiter by a customer they count as a gift from the customer to the worker and do not form part of the worker’s pay and therefore cannot count towards NMW pay.

However if a service charge is compulsory, it is the property of the employer and the employer can share it between the workers as they wish. If a tip is paid by a customer voluntarily adding an extra amount to a credit card or cheque payment, the tip is the property of the employer.

Both could form part of the worker’s wages if paid through the payroll and could count towards NMW. From October 2009 this loophole will be closed.

Under the NMW legislation there are special rules for apprentices and this is a frequent area of enquiry to the NMW Helpline for Northern Ireland. An apprentice who is aged 18 or under does not qualify for the NMW until they reach the age of 19, providing they have worked for their employers for 12 months. Once they have worked for their employer for 12 months as an apprentice and are over 19 years old they will become entitled to the normal minimum wage for their age.

This means if someone aged 18 and a half starts an apprenticeship, they will not be entitled to the minimum wage until they are aged 19 and a half, so that they have worked for their employer as an apprentice for 12 months. A person aged 19 or over who is no longer an apprentice but is a worker, will be entitled to the normal rate of minimum wage for their age.

The Government is currently considering the LPC’s recommendation on introducing a minimum wage for apprentices and will respond in full on this issue in their next report.

Further help on all aspects of the NMW for both employers and employees is available, in confidence, from the NMW Helpline operated by Citizens Advice on 0845 6500 207 or by visiting the website at www.nmwadvice.co.uk.

Belfast Telegraph, 16 June, 2009

Cheltenham Borough Council has today lost its case to sue former employee Christine Laird for £1million for not disclosing her past experience of depression. Leading mental health charity Mind says the landmark ruling serves as an important reminder to employers about the importance of providing adequate support to people with mental health problems in the workplace.

Mind’s Chief Executive Paul Farmer said: “This ruling provides reassurance to the one in four people in this country who will at some point have a mental health problem that they will not be penalised by their employer for being unwell. Mental illness is an illness like any other and employers need to do more to understand the issues people face and provide reasonable adjustments that help people to stay in their job.”

“We know that less than half of employers say they would employ someone with a mental health problem (Department of Work and Pensions 2001) which means that people with experience of mental distress are often stuck between a rock and a hard place – disclose and face discrimination, or don’t disclose and run the risk of being ‘found out’ later and potentially sacked.”

“We would always encourage people to disclose their mental health issues and to have an open dialogue with their employer. Current disability discrimination law already clearly states that it is illegal to discriminate against someone on the grounds of their mental health so by disclosing you are protected by law.”

“The concern now is that employers will introduce more stringent pre-employment questionnaires which will only serve to raise the barrier to employment for people with mental health problems. The Government must use the new Equalities Bill as an opportunity to restrict the use of pre-employment questionnaires and instead introduce a post appointment survey which will identify any need for additional support.”

A snapshot poll by Mind (based on the responses of 279 people who completed a poll on Mind’s website in October 2008.) about employee’s experiences found:

• 1 in 4 had job offers withdrawn after disclosing a mental health problem which is illegal under the Disability Discrimination Act.
• 58% had to leave a job because of a lack on mental health support.
• 31% had been sacked or forced out of a job after disclosing a mental health problem.
• 26% had been demoted after disclosing a mental health problem.

Medical News Today, 16 June 2009

British Airways is asking thousands of staff to work for nothing, for up to one month, to help the airline survive.

The appeal, sent by e-mail to more than 30,000 workers in the UK, asks them to volunteer for between one week and one month’s unpaid leave, or unpaid work.

BA’s Chief Executive Willie Walsh has already agreed to work unpaid in July, forgoing his month’s salary of £61,000.

Last month, BA posted a record annual loss of £401m, partly due to higher fuel bills and other costs.

FIGHT FOR SURVIVAL

BA has said that hundreds of staff have responded positively to the request.

But some employees and unions have condemned the plan, saying improvements in the management of the airline were a bigger priority.

Indeed cabin crew and baggage handlers contacted by the BBC rejected the plan out of hand.

“It’s a big no. A very big no. Everyone is up in arms. We’re not taking it. I’d love to take a month’s unpaid leave but I can’t afford to do that,” said one baggage handler at Heathrow.

But Mr Walsh said BA’s drive to save cash was part of a “fight for survival”.

“I am looking for every single part of the company to take part in some way in this cash-effective way of helping the company’s survival plan,” he said.

“It really counts,” he added.

BA has been in urgent talks during the past few weeks with trade unions at the company over other ways to save money.

Details of a large pay and productivity deal are expected to be announced on Wednesday.

FLEXIBLE SCHEME

A company spokesman said it did not have an exact target for the expected savings from its appeal.

“As much as possible, but we don’t have a figure,” he said.

The idea was first launched last month when the airline asked staff to volunteer for a month’s unpaid leave, or to work for free for that time.

That attracted more than 1,000 applicants.

But the company’s more recent version of its scheme, launched last week by e-mail and in an article in the internal staff newspaper BA News, is more flexible.

It asks staff to volunteer by the end of this month for between one week and one month of unpaid leave or unpaid work.

The lost salary will be spread over between three and six months.

UNUSUAL

BA said other airlines, such as Cathay Pacific, had launched similar schemes and a majority of their workforces had signed up for them.

Many employers have imposed pay cuts or short-time working since the recession struck the UK last year.

“In certain cases such as Honda, they shut down for several weeks,” said Alistair Hatchett of the research organisation Incomes Data Services.

“Where it is obvious the economic circumstances are tough, people are
willing to talk.

“Where employers try it on opportunistically, then there is a challenge,” he added.

“While some options may seem unattractive, particularly where they involve reduced income, many employees will conclude that the alternative of losing their job looks bleaker,” said Mike Emmott of the Chartered Institute of Personnel and Development (CIPD).

BBC News 16 June 2009

The lords agreed with a claim by Keith Ainsworth, a former tax inspector in Chester who complained that HM Revenue and Customs wrongly made a deduction from his wages, involving holiday pay when he was ill.

In the judgement, Lord Rodger of Earlsferry concluded workers also had a right to carry over holiday leave which they were unable to take while ill into the following year’s allocation, or take pay in lieu.

Lord Brown of Eaton-Under-Heywood noted: “The purpose of a ‘holiday’ from work is, at least in part, the psychological and social well-being of the employee.”

He continued to say that holiday could be considered as similar to wages in terms of being something that was due to the employee whether they were ill or not.

The ruling means an employee who returns to work from a year of illness would legally be entitled to four weeks’ holiday immediately upon his return.

The claims relate to a long-running dispute brought against HMRC by former staff who retired, or had to retire, after long illness. In an earlier hearing, judges at the Court of Appeal ruled a worker cannot take statutory holiday while they are on sick leave and is not entitled to payment in lieu of any untaken holiday on termination of their employment.

The claimants appealed to the House of Lords which yesterday overturned the Court of Appeal judgment and restored the decision of an employment tribunal after referring various questions on the case to the European Court of Justice for clarification.

Naomi Feinstein, a partner in the employment team at lawyers Lovells, said: “In a very technical ruling, the House of Lords has decided that a claim for unpaid holiday pay can be brought as an unauthorised deduction of wages claim, as well as under the Working Time Regulations 1998.

“This decision will come as a blow to employers. Generous time limits for unauthorised deduction claims mean businesses could now face substantial holiday pay claims – for example from employees on long-term sickness absence, who have not received holiday pay because on the basis of the earlier Court of Appeal decision they were not entitled to it.”

Tim Marshall, Partner and UK Head of Employment at lawyers DLA Piper, said: “The judgment will increase the complexity of managing absence from work by allowing workers to take accrued holiday when they return to work even after many months or more than a year off.

“Until now the UK’s Working Time Regulations required employees to use all holiday leave within a year or lose it – a cost and time efficient way to manage leave.

“Allowing workers to accrue statutory paid holiday entitlement during sickness absence will have serious financial and practical ramifications for employers across the UK.”

Mark Serwotka, general secretary of the Public and Commercial Services Union, said: “This is a victory for common sense.”

Telegraph, 10/06/09

A Barclays worker paid double her salary by mistake for three years will carry on receiving the amount after a legal victory over her bosses.

Natasha Keenan launched a tribunal after the bank cut her pay in half just days before Christmas when they noticed the payroll error.

They had also demanded she pay back the £20,000 “extra” she had received.
But a judge ruled the part-time complaints advisor should not be made to repay the money she received in error – after finding it was the bank’s fault.

Mrs Keenan, 36, a mother of two, will continue to receive £19,246-a-year for working 19 hours a week at the bank’s offices in Dartford, Kent, although her pay should be around £9,500-a-year to take account of her part-time status.

Tribunal judge Martin Kurrein said: “I am confident that if Mrs Keenan had known that Barclays had made a mistake, she would have informed them of that.”

Mrs Keenan, from Erith, Kent, said: “If I had realised they’d made a mistake with my salary which could be spotted at any time, I wouldn’t have put my family’s future at risk and used it to apply for a mortgage.

“I certainly wouldn’t have asked Barclays for a reference. I have repeatedly allowed Barclays staff access to my account. I clearly stated my salary when I applied for a Barclaycard.

“My manager and team leader must have known what I was getting paid.”

A spokesman for Barclays said: “We have no further comment at this stage as the decision and its impact remains a confidential matter between the bank and its employee.

“However we can confirm that Mrs Keenan remains a valued employee of the company.”

Telegraph, 15 June, 2009

A survey of UK businesses has shown most Scottish employers plan to sit tight and neither hire nor fire over the next three months.

The survey, from employment services firm Manpower, found 81% of employers did not anticipate staff changes.

The poll showed 8% planning to increase headcount and 8% intending to reduce staff numbers.

Manpower seasonally adjusted those figures to produce what it called a net employment outlook of -4%. The figure among UK employers was worse at -6%.

The survey assessed the hiring intentions of over 2,100 UK employers for the quarter ahead – July to September 2009. The company said the results revealed a subdued labour market in Scotland, with a net employment outlook of -4%.

Employers in the region reported marginally improved hiring prospects since the last quarter, with the outlook improving by 3% quarter-over-quarter but declining by 2% year-over-year.

Scotland’s outlook remained in negative territory for the third consecutive quarter, but its employer hiring intentions were still more positive than the National Net Employment Outlook of -6%. However, 81% of employers anticipated no change in headcount over the coming three months, indicating that the majority still intend to exercise caution before making any changes to staff levels.

Manpower’s Amanda White said: “The labour market in Scotland is tough right now, with staff cutbacks reported in all sectors and at all levels of business.

“It’s not all doom and gloom though.

“We have seen an increased demand for staff within the public and social sector, particularly in local councils and colleges.

“We have also seen a rise in demand for customer services and sales staff, which is good news for local job seekers.”

Jason Greaves, head of commercial staffing at Manpower, said: “These may be unprecedented labour market conditions, but there are still jobs out there.

“It’s an employer’s market right now with a greater number of candidates to choose from in the recruitment pool, so it is important for job seekers to continue investing in retraining or up-skilling to maintain a competitive edge.”

BBC News, 08 June, 2009

A cocktail waitress who refused to wear a tight-fitting dress at work has been awarded £3,000 compensation.

Fata Lemes, 33, worked at the Rocket Bar in Mayfair for eight days last year and was told female staff would have to wear the tight red dress in the summer.

At the time the uniform was a black shirt and trousers for men and women. A panel upheld her claim that bar owners Spring and Green had discriminated against her on the grounds of her gender.

Led by employment judge Anthony Snelson, the panel said Ms Lemes, who said the dress made her feel like a prostitute, held “views about modesty and decency which some might think unusual in Britain in the 21st Century”. The panel said: “Plainly, it (the dress) related to her sex. It was gender-specific.

“The respondents did not introduce a summer uniform for male waiting staff. Unlike the women, the men were not required to switch to brightly coloured, figure-hugging garb.”

The panel decided that forcing Ms Lemes to wear the dress in order to keep her job at the bar “violated her dignity” and created a “humiliating” environment.

Ms Lemes told the panel she was even propositioned by two men on her second shift, who were looking for “a blonde Scandinavian or Swedish girl for one or more nights”.

She told bosses she felt unable to wear the dress, and it became clear neither side would compromise, the panel found. It rejected Ms Lemes’ claims that she was sacked from the bar and that she fell prey to discrimination because she did not receive tips for the shifts she worked.

For that reason the panel decided her original claim of £17,500 was dismissed as “manifestly absurd”.

However, it granted £3,000 compensation and £711.73 in wages, plus interest, giving a total of £3,893.26.

This was reduced by 25% because the members found Ms Lemes’s solicitor Joe Sykes did not set out the basis of grievance properly.

BBC News Monday, 15 June, 2009

A law firm has claimed that a solicitor was unable to fly to Glasgow to represent a client at an employment tribunal because of the swine flu outbreak.

But the firm has been ordered to pay almost £400 towards the other side’s wasted costs after tribunal judge Paul Cape rejected the explanation.

Pedro Okoro, of Pedro Emmanuel Solicitors in Sutton, Surrey, was due to represent Kabiru Atta, who was accusing the Dell Corporation of unfair dismissal and racial discrimination.

But Mr Okoro’s firm sent a letter to the tribunal the day before, advising that Mr Okoro “has caught a cold and believes the airlines will not allow him to fly because of his constant sneezing, obviously owing to the current problems with swine flu”.

The letter did not arrive until after the close of business, and counsel for Dell arrived for the hearing.

The tribunal ordered Pedro Emmanuel to pay Dell’s wasted costs of £390.

It also dismissed the case of Mr Atta, of Alexandra Court, Glasgow, on the basis it had no reasonable prospect of success.

Scottish Legal News, 16 June, 2009