The government is committed to delivering 3 million apprenticeships by 2020. To help them achieve this, they introduced the Apprenticeship Levy in April 2017. The levy requires organisations, with an annual pay bill over £3 million, to pay 0.5 per cent of their pay bill into a digital levy account. The money is then available for them to spend on apprenticeships and apprentice training over a 24-month period, before it expires.
Since its introduction, however, rather than increasing the number of apprenticeships, it seems the levy has, at least in the short-term, had the opposite effect. Department for Education (DfE) figures show that between May and July 2017 48,000 workers started an apprenticeship, compared to 117,000 for the same period in 2016. The DfE says that it expected to see an initial drop in new apprenticeships while employers assessed how the levy would affect them and developed new schemes to make the most of the funds available. It predicts that the number of apprenticeship starts will increase, as organisations gain more understanding of the levy scheme and finalise their business plans.
In his November budget, however, the Chancellor acknowledged that difficulties have been caused by the complexity of the levy scheme and its rules regarding how funds can be used to finance apprenticeships and how levy payments can be shared across organisations within group structures. Although no further details have been provided, he stated that the government will be reviewing the scheme and, in particular, looking at the flexibility levy payers have to spend the funds.
Alongside the introduction of the levy for large organisations, smaller organisations have also been subject to apprenticeship changes. All small organisations are now required to pay 10% of the apprenticeship costs with the government contributing 90% and must release apprentices for one day a week for offsite training. As these changes affect small organisations financially, it is possible that they may have taken the business decision to reduce apprentices in their workforce, which could also have an impact on the government’s ability to achieve their 2020 target.
New guidance on mental health in the workplace
To coincide with World Mental Health Day, ACAS has produced new guidance to help employers support employees who may be suffering from poor mental health. Click here to download a copy of Promoting positive mental health in the workplace from our Document Library
ACAS highlights the role of line managers as key when supporting employee wellbeing. Whilst being responsible for monitoring workloads and setting reasonable targets, it suggests that managers should also have a pastoral role. They should be approachable and encourage their employees to talk if they are experiencing difficulties.
Another report has found that long-term mental health conditions cause up to 300,000 people to leave their jobs each year. The ‘Thriving at Work’ report aims to change the culture around mental health to create a more open, understanding and aware society. It contains a number of proposals and “mental health core standards” which can be put in place quickly across all organisations including: producing and implementing a mental health at work plan; developing awareness; and encouraging open conversations.
Paid parental bereavement leave
By 2020, the government plans to introduce a legal right to paid time off for parents in the event of the death of a child. The Parental Bereavement (Pay and Leave) Bill gives parents the right to take two weeks’ bereavement leave if their child, aged under 18, dies. The paid leave will apply to parents with at least has 26 weeks’ continuous employment with the organisation, although it is unclear whether they will receive full pay, or statutory rates of pay similar to other family friendly leave.
National Minimum Wage & Living Wage Rates
The minimum wage increases that will take effect from April 2018 were confirmed by the Chancellor in his November 2017 budget. The national living wage rate, for workers aged 25 and over, will increase by 4.4 per cent from £7.50 to £7.83 an hour. This increase will give a full-time worker a £600 a year pay increase. The government has also now accepted the Low Pay Commission’s recommendations for national minimum wage (NMW) increases. From April 2018, the following increases will apply:
• Workers aged 21-24 – NMW will increase from £7.05 to £7.38 an hour
• Workers aged 18-20 – NMW will increase from £5.60 to £5.90 an hour
• Workers aged 16-17 – NMW will increase from £4.05 to £4.20 an hour
• Apprentice rate – will increase from £3.50 to £3.70 per hour.
If you want to check the current statutory rates, please click here for more information.
Recent Case Law – Dismissal due to failure to provide ‘right to work’ documentation
It is unlawful to employ someone who is ‘subject to immigration control’ i.e. anyone who does not have valid leave to enter or remain in the UK, or has valid leave but is not permitted to work. Allowing illegal working can have serious consequences for employers and those found to have ‘reasonable cause’ to believe that an individual is working illegally may face significant penalties, which can commonly amount to £20,000. The challenge comes for HR, however, if an employee fails to provide the documents requested to prove their right to work and a recent EAT Case (Baker v Abellio London) highlights that it may not always be fair to dismiss an employee under such circumstances.
The Claimant, Mr Baker, was a Jamaican national living in the UK. On discovering that another employee did not have the correct ‘right to work’ documentation, his employer, Abellio, decided to carry out fresh checks across its workforce. Mr Baker informed them that he did not have a passport, but maintained that he did have the right to work in the UK. Despite being given extra time and financial assistance to obtain a passport, he failed to produce one. The Home Office had, however, confimed that he had the right to remain and work in the UK. Despite this, his employer considered that they could not obtain the evidence to protect them from criminal liability or a civil penalty, should Mr Baker later be found to be working illegally, and, therefore, dismissed him for ‘illegality’. Mr Baker subsequently brought a claim of unfair dismissal.
The Employment Tribunal that first heard the case decided that Mr Baker had been fairly dismissed. However, the Employment Appeal Tribunal disagreed and reversed the decision.
In this case, the employer had worked hard to comply with the requirements of the immigration regime but, ultimately, fell foul of unfair dismissal rules. For dismissal to be fair, the employer must identify the correct potentially fair reason. Abellio had chosen ‘illegality’ but continuing to employ Mr Baker would not have put them in breach of any legal requirements. Therefore, ‘illegality’ was not the correct label. This highlights the fundamental importance of choosing very carefully the reason for dismissal and it is recommended that organisations take specialist advice before making any dismissal. In this case, for example, if the employer had chosen another reason, such as ‘Some Other Substantial reason’ (SOSR) for dismissal, there may have been a very different outcome.
This newsletter was curated by Nicole Squires, MA, Chartered MCIPD, an Executive Consultant at People Based Solutions. People Based Solutions is an HR support company that specialises in supporting small and medium sized businesses meet all of their HR commitments. If you want to know how People Based solutions can help you meet your HR and Employment Law obligations click here for your free HR Health Check. Alternatively, you can call us on 01925 425 857, send an e-mail to firstname.lastname@example.org or Click Here to visit our website