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E-cigarettes are causing a storm. They have been introduced to help people give up smoking and sales have soared over the last ten years. Currently there are 1.3 million people in the UK that use the devices according to Action on Smoking and Health, therefore, employers need to understand how to manage e-cigarettes in the workplace.
From 2016 electronic cigarettes will be licensed as a medicine. Currently they are marketed as a safe way to help stop smoking. Many are designed to look like cigarettes, although some look like a pen. They vaporise a nicotine solution that replicates smoking tobacco but are not licenced by the Health Act 2006 which governs that. They do not give off smoke, do not contain tobacco but do contain chemicals. The British Medical Association states that more research needs to be done to establish the safety of the nicotine replacement devices as some experts have questioned this. In some countries they are very heavily regulated.
E-cigarettes are not a quit tool, they provide the individual with an alternative to smoking tobacco with the ability to inhale the vapour. Even if they are safe and whilst it is not illegal to use an electronic cigarette in the workplace, simulating smoking can cause employee disharmony therefore there are important considerations for employers.
Pregnant workers or those who are trying to give up may be particularly concerned about colleagues who use e-cigarettes in the workplace and mimic real smoking. In this day and age when well being is actively promoted and cigarette smoking in indoor public areas is banned, damage to the professional image of an organisation may be done if employees using e-cigarettes are viewed by customers who come on site. If e-cigarettes are permitted, therefore, they may give off the wrong message.
As a minimum employers should have guidelines that prevent the use of cigarettes in customer facing areas, in the presence of visitors and in catering or food preparation areas. Whilst many e-cigarettes are odourless, some do have an odour eg cinnamon that may be irritating to colleagues so additional guidelines on odour-free e-cigarettes should be included.
The potential benefits to employers for allowing the use of e-cigarettes are fewer smoke breaks and fewer health problems related to smoking and time of work. However, many employers are now starting to ban e-cigarettes totally in the workplace.
If employers are to ban the use of e-cigarettes they must amend an existing no smoking policy and or drugs/alcohol policy to include that fact as well as detail their approach to managing the situation. If no policy exists, one should be created. E-cigarettes should be expressly banned in company vehicles, in the workplace and on customer premises. Any changes to the policy, or development of a new one, needs to be well communicated to the workforce to avoid any misunderstandings.
Employers should consider providing a separate outdoor shelter for e-cigarette smokers, who are effectively non-smokers, if they provide the same facilities for smokers. After all it would not be fair to let these workers to share the same facilities as those who are smoking cigarettes. The number of smoking breaks allowed should be documented in a policy linked to the disciplinary policy for abuse of this privilege.
It is a business decision of whether an employer decides to allow the use of e-cigarettes or ban them.
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The Government is consulting on strengthening the existing legislation to ensure that the correct amount of income tax and NIC are paid where the worker is, in effect, employed. This legislation is expected to take effect from April 2014. The legislation is designed for removing the mask of false self employment.
The largest business sector which is likely to be affected is the construction industry but there is apparently widespread evidence that other sectors including the driving, catering and security industries are using these arrangements.
So what are the proposed changes?
The central proposal is to make a change to the agency legislation. At present if this legislation applies then the intermediary must deduct PAYE and NIC. However, this legislation only applies where workers provide their services under the terms of an agency contract in which the worker is obliged to personally provide services to the client.
Some intermediaries have set up contracts which allow the worker to send a substitute to do their job (even though this often does not occur) and on this basis it is argued that the agency legislation does not apply.
The Government propose to amend the legislation and remove the obligation for the worker to personally provide their services. Instead, where there is a supply of personal services and the end user exercises control over the worker the agency legislation will apply. This means that the payments from the intermediary to the worker will be deemed employment and, as a result, the intermediary must operate PAYE and NIC.
In order to assist HMRC in identifying possible cases of non-compliance with the new legislation, it is proposed that there will be a new statutory returns requirement. The intermediary will need to submit a quarterly electronic return containing details of any workers it has placed for whom it is not operating PAYE and NIC.
We will update you with any developments once the new legislation is finalised. In the meantime if you would like any further information please contact CED Accountancy Services Ltd.
1 Lucas Bridge Business Park, 1 Old Greens Norton Road, Towcester, Northants NN12 8AX TELEPHONE: 01327 358866 FAX: 01327 358355 E-MAIL: email@example.com
This guest blog is provided by CED Accountancy Services Ltd.
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The incidence of cancer is on the rise. The cost to the UK economy for employees dropping out of of work due to the illness is £5.3bn. Most of us know someone that has been affected by it and it is important to know how to deal with cancer in the workplace. At a recent seminar organised by MacMillan Cancer Support I learnt some useful information which I shall share with you in this blog.
Many employers do not know how to support staff with cancer. 82% of employees with cancer want to work, however, they are 1.4 times more likely to be unemployed. 47% of those with cancer have to give up work or change their roles because of the diagnosis. 47% say that employers don’t discuss sick pay entitlement, flexible working or workplace adjustments which is quite shocking. Cancer is a disability and covered by the Equality Act, yet only 49% of managers know this fact. Only 28% of managers have received training on the legislation. MacMillan Cancer Support provides support online for SMEs to help manage situations.
Employees who are faced with cancer can also face financial difficulties. They risk losing their homes if their income drops. MacMillan provide hardship grants which can help pay utility, heating and phone bills. Last year £90,000 was paid out in grants which can be accessed through the NHS.
The key issues for employers are managing confidentiality, sickness absence, discrimination, capability and ultimately termination.
An employee does not have to share 100% of the information about their condition. If a medical report is produced under the Access to Medical Records Act the employee has the right to change the report and to have it with held from their employer.
Employers must have express consent to disclose any information to colleagues. Where an employee is refusing to allow an employer to divulge any information to anyone, it might be a good idea to try and persuade the employee that a brief explanation might be needed in order to reduce curiosity about the employee’s behaviour or absence.
Employees who go on long term sick due to their condition should be contacted on an agreed basis either by letter or phone. It is important for the employer to keep in touch and not ignore the employee otherwise they could resign and claim for constructive dismissal.
Cancer is a distressing condition and it is important the employers help manage the work related situation as best they can. Training and education for managers and key members of staff is really important.
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Michael Gove recently announced the introduction of performance related pay in the teaching industry from September 2014 http://www.theguardian.com/education/2013/jan/15/teachers-pay-performance-michael-gove Instead of automatic annual increments progressing through the grade, teachers will be expected to demonstrate good performance before receiving a pay increase. Schools should be working on how they will put a procedure into place. This is not a new phenomenon. When I was working for the Probation Service over fifteen years ago, it was introduced for the senior management team. So is performance related pay back in favour?
The idea is that performance related pay (or merit pay) will reward excellent teachers more money and hopefully incentivise poor performers to increase the quality of their teaching. Teachers’ performance will have to be closely appraised so that the link between performance and pay is very clear. Whilst there are good and bad teachers in the education system, there are advantages and disadvantages with this idea.
The plan is for performance related pay to increase flexibility in schools, to attract and retain quality teachers, to attract more graduates into the profession and create a culture of professional development.
A report produced by the Policy Exchange about performance related pay and teachers stated that a well designed system should include:
- An evaluation based on several measures, not just test or exam scores.
- A prolonged evaluation over more than one year to reduce volatility in results and to allow staff to adjust to the new assessments.
- Financial rewards based on increases in base salary, rather than through bonuses.
- The use of performance pay to recruit and retain effective teachers, including the use of Pupil Premium funds to pay for this.
- The use of performance pay not as a way of holding down pay, but as a reward for real excellence. This may require the redesign of teacher pay bands within a school.
Teachers’ performance may be assessed on a range of areas according to government guidelines:
- impact on pupil progress
- impact on wider outcomes for pupils
- contribution to improvements in other areas (eg pupils’ behaviour or lesson planning)
- professional and career development
- wider contribution to the work of the school, for instance their involvement in school business outside the classroom
In the past it has been difficult to introduce performance related pay into the public sector due to the difficulty of measuring performance in certain roles.
The rationale of linking high performance to pay attempts to develop a high performance culture and should provide equity and fairness. It is widely used in the private sector with many managers receiving it rather than low grade workers.
For performance related pay to be valued by employees there needs to be a clear link between good performance and pay. One barrier to its effective use is subjectivity of the line manager. They should receive thorough training in the operation of the appraisal system with lots of openness and transparency. The variances between hard and soft managers needs to be managed and favouritism dispensed with. The issue of possible discrimination needs to be addressed when training and educating the managerial workforce.
The element of performance related pay needs to be worthwhile, as with any employee reward. Too little and it will not be sufficiently motivating. The pay budget will have its limits and must be distributed appropriately across those who are performing well.
Employers who are looking for a simple cost effective pension scheme in order to comply with pension auto enrolment may like to consider implementing the NEST pension which has been developed by the government. NEST is ideal for small and medium sized businesses and helps employers comply with pension auto enrolment statutory legislation.
Employers may plan to implement NEST in accordance with their staging date or may bring their staging date forward as a volunteer employer. It is important to first know when the staging date is before making a decision.
The first stage of implementing a NEST pension is to contact NEST (http://www.nestpensions.org.uk) and register to obtain an account. It is important to finalise set up within 90 days of the first contact otherwise the whole process must begin again.
NEST should be provided with information about organisation – PAYE reference and contact information. There should be a main contact in the organisation but additional delegates can be given access. Worker groups and payment sources must then be added.
The workforce must be assessed according to age, salary and status. They should fall into three separate categories – eligible job holders, non-eligible job holders and entitled workers. An employer must make pension contributions for eligible and non-eligible job holders but does not have to for entitled workers.
If implementing NEST and bringing the pension auto enrolment staging date forward employees should be written to at least one month before the proposed staging date. Details on the NEST pension should be provided and as part of the pension auto enrolment process eligible workers should be offered the ability to opt out. They have one month in which to opt out. Any pension contributions that have been taken must then be refunded. A consultation meeting should be offered so employees can discuss any concerns and queries about the process.
If an employer is voluntarily entering NEST they must get signed agreement from the employees to make deductions.
It is important to get NEST permission to auto enrol early. This can be done by contacting NEST and completing a form over the phone which goes to the compliance department. It is important to do this in good time in order to prevent any delays in meeting the planned earlier staging date.
If bringing the staging date forward the Pension Regulator must be informed in writing. This can be done online using a 10 digit reference code that the employer will need to obtain or may done by letter or email. This should be done in good time and at least a month before the earlier staging date.
The information to be provided is:
- Employer name.
- Employer PAYE scheme reference(s) eg 123/4AB (you can find this on your P35 employer annual return). Please include all PAYE scheme references that you operate.
- The new (earlier) staging date chosen and your original staging date.
- Employer’s address (including postcode) and email address.
- The name of the owner or most senior accountable person at the employer (optional).
- Companies House registration number or equivalent, eg registered charity number, VAT registration number or industrial provident society number.
- A declaration from the employer that they have contacted a pension scheme and have obtained the agreement of the trustees or managers, provider, or administrator, that the scheme can be used to comply with the employer duties from the new (earlier) staging date.
- Your name.
- Your job title within your organisation.
- Your contact telephone number, email address and business address.
- Your own declaration that you are authorised to apply for a change of staging date.
Employee information should be provided to NEST. This can be done manually or via a CSV file upload. Employees will then be sent a welcome pack from NEST which will contain their ID number.
Payroll should be set up for employer and employee contributions and NEST should then be provided with an employer/employee contribution schedule.
Employers should make contributions to NEST no later than the 22nd of the month after contributions have been taken.
It’s important to allow plenty of time in planning and implementing the process. From experience this is a very heavily admin based procedure and there may be hiccups along the way.
Call 0845 241 1868 if you need assistance with implementing the NEST pension.
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Introducing a simple flexible benefits scheme can be a great way to improve employee retention and movation.
One of my clients allows their employees with five years service to purchase a week’s additional holiday. This can be the starting point for employers in introducing flexible benefits. The ability to buy and sell holiday can be a stand alone flexible benefits item or be part of a wider offering.
Many employees relish the ability to buy extra holiday with few taking up the opportunity to sell it. However the latter can come in handy when times are tough and extra funds are required.
Initially the employer should decide what they want to achieve from introducing a simple flexible benefits scheme – how it will help the company as well as employees.
Other simple benefits that can be introduced are the ability to buy health and/or dental insurance and childcare vouchers (perhaps through salary sacrifice). Surveying employees with regards to their requirements can throw up some possible good suggestions. The cost of each benefit needs to be considered along with affordability. Sourcing cost effective employee benefit providers is also important. Making only a few additions adds to simplicity.
Communication to employees is essential and can be done on a 1:1 or group basis via presentation backed up with documentation.
The employer should ensure that the employment contract clearly reflects the arrangement and when the variation occurs either a new contract is drawn up or a variation letter provided to the employee. The change should be deemed to be permanent to avoid the employee changing their mind half way through a year.
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After the dearth of the recession years, employee reward is on the up and compensation and benefit issues are in the spotlight.
For many years salaries have stagnated with few companies being able to offer a pay increase and many making many job cuts. But along with the current buzz of increasing recruitment, pay seems to be top of the agenda with pay awards of around 2.5% being anticipated this year and reward structures being assessed for fit for purpose reasons.
As I blogged about recently there is a skills shortage in the UK so it is important the companies hold onto their talent and make sure they are incentivised. Pay can be a big incentiviser for some, but employee total reward encompasses financial reward with motivational aspects such as career development, job satisfaction and recognition. To retain and recruit talent companies may have to consider paying above the market rate.
Employee reward specialists have always been thin on the ground, but now, more than ever, they are needed to help organisations develop reward solutions to support business strategy. Employee reward professionals can help with employee reward strategy, analytics to assist with pay and benefit reviews, job evaluation which links job size to pay and defends equal pay claims, flexible benefits, salary sacrifice schemes, bonuses, commission schemes and pensions particularly pension auto enrolment.
Total reward statements can help employees to see the full effect of the benefits they receive. So many employees do not understand the benefits a company provides to them. All benefits can be included such as maternity pay, health insurance, employee assistance programmes. Seeing financial employee reward on paper as a simple pie chart or graph can add to employee retention.
It makes sense for employers to reward their staff well to encourage motivation that will impact on the bottom line.
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There will be an increase in employment tribunal costs soon. The level of compensation an employment tribunal may award is due to go up on 6 April 2014 under the Employment Rights (Increase of Limits) Order 2014 (SI 2014/382. The maximum compensatory award for unfair dismissal will rise from £74,200 to £76,574. The maximum amount of a week’s pay, used to calculate redundancy payments or various awards including the basic or additional award of compensation for unfair dismissal, also rises from £450 to £464.
Tribunals will also have the power to impose financial penalties of from £100 up to £5,000 on employers who are deemed to have breached a worker’s employment rights with aggravating features. What an aggravating feature looks like has yet to be defined as cases proceed. The Enterprise and Regulatory Reform Act 2013, in its bill form, suggested that aggravating features could include:
- The size of the employer
- The duration of the breach of the employment right
- The circumstances of the case and
- The employee and employer’s behaviour
It also stated that a tribunal may be more likely to find that there are aggravating features where:
- The action was deliberate or committed with malice
- The employer was an organisation with a dedicated human resources team, and/or
- Where the employer had repeatedly breached the employment right concerned
A tribunal may be less likely to find that there are aggravating features where an employer:
- Has been in operation for only a short period of time
- Is a micro business
- Has only a limited human resources function, and/or
- Made a genuine mistake
The tribunal shall judge an employers’ ability to pay and the penalty shall be paid to the Secretary of State. This initiative will be implemented on 6 April and shall apply to claims lodged on that day and thereafter. Even where no financial award has been made the employer may be required to pay a financial penalty anyway.
This may not be a welcome change for employers where the government has pledged to reduce red tape. However it has been said that the existing employment tribunal system is employer friendly (although not many employers will say that). The introduction of costs against an employer will be balanced out by the fees introduced for claimants to pay to lodge a claim. Recent case law has shown that successful claimants will also recover tribunal fees from a respondent with a costs order.
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We’ve all come across them – that negative colleague who does not have a good word to say about their work, the company or management. Any new initiative is quickly slandered so organisational change is difficult. Given the chance they will spend all day complaining about their work related lot and it really isn’t very pleasant having to listen to it, is it? So how to deal with a negative employee?
Well, the first thing is don’t ignore the negativity. If left undealt with, the individual will start to influence other members of staff with their negative attitude. They will undermine and sabotage the company. The individual can reduce morale and ultimately cause a loss in profits.
You must speak to the employee privately to address the actions that you have seen giving at least two specific examples of where their behaviour has fallen short. Examples could include where they have criticised something about the business or the work they do or where they have failed to take the initiative with a required work duty. Alternatively the individual may appear constantly hostile or aggressive to work colleagues makinglife very unpleasant.
The individual may not realise the impact their behaviour is having in the work environment. If it is drawn to their attention, it made come to an end quickly. They may share reasons with you for their behaviour which you may be able to help them overcome with support. If you resolve the problem the employee may become happier. However, if the negative attitude can not be resolved after the conversation, then you must take further action.
Further action could mean a documented formal meeting in which clear expectations of behaviour are laid down where the employee is clearly made aware that without improvement disciplinary action could be taken.