Heyday opinion on the legality of the age regulation
On 23 September the Advocate-General handed down his long-awaited opinion in the Heyday appeal - a case brought by part of Age Concern. Age Concern challenged the lawfulness of the UK's age discrimination regulations. The main challenge was to the lawfulness of the UK's regulation permitting employers to retire employees aged 65 or over. Hundreds of employment tribunal claims are currently stayed pending the outcome of this litigation.
The Advocate-General has recommended that the European Court of Justice holds that:
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A rule which permits employers to dismiss employees aged 65 or over if the reason for dismissal is retirement can, in principle, be justified.
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It can be justified if the rule has a legitimate aim relating to employment policy and the labour market, and is not inappropriate and unnecessary for the purpose.
The European Court of Justice is not obliged to follow the Advocate-General's opinion so this is not the last word on the issue. The decision is expected just before Christmas.
If the decision follows the Advocate-General's opinion, the next step would be for the UK Government to satisfy the High Court that the compulsory retirement provisions in the UK age discrimination regulations can be justified.
In the meantime, there continue to be risks for all employers in implementing compulsory retirement dismissals.
Age discrimination and redundancy payment schemes
The EAT has given judgment in two separate cases both concerning enhanced redundancy payments calculated by reference to the employee's length of service and age. Neither scheme fell within the exemption for schemes which closely follow the statutory redundancy payment arrangements. Read more.
Team moves, poaching and unfair competition
Over the summer we saw two robust decisions against individual employees in cases of conspiracy to compete. It is well known that properly drafted post termination restrictive covenants can be effective in preventing employees from leaving and setting up in competition. These cases, however demonstrate the importance of the duty of fidelity that is implied into all contracts of employment, and the separate fiduciary duties owed to an employer by a senior employee. Read more.
Deadline for registration as a Sponsor
Tier 2 of the new Points-Based System is due to launch in November. The UK Border Agency has announced that they will only guarantee that those applications to register as a sponsor which are submitted before 1 October 2008 will be processed in time for the launch of the Tier in November. If your organisation employs migrant workers you should be preparing your sponsorship application now, if you haven't already done so.
Codes of Practice
New guidance to the sponsorship process has been issued by the UK Border Agency, including details setting out the criteria for issuing certificates of sponsorship and what documentation to retain during the employment of migrant workers.
In addition, sector specific codes of practice have been published which set out what jobs require qualifications equivalent to or higher than NVQ level 3, as certificates of sponsorship should only be issued for skilled positions which require this level of qualification. The codes also explain how to advertise a position to satisfy the resident labour market test.
If you are currently undertaking recruitment campaigns and are intending to issue certificates of sponsorship once Tier 2 goes live, you should review the codes of practice now to ensure that your recruitment campaign complies with the new rules.
Shortage Occupations
The UK Border Agency has published a list of recommended shortage occupations. Sponsors will not be required to satisfy the resident labour market test if a certificate is to be issued for a recognised shortage occupation.
Please contact Tracy Evlogidis or Nick Hobson for more information on immigration issues.
New for October 2008 - new laws on wages, insurance and sick pay
1 October and 1 February are the two annual commencement dates when new employment laws are introduced. 1 October this year brings:
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A rise in the national minimum wage to £5.73 for workers aged 22 and over, £4.77 for 18-21 year olds and £3.53 for 16-17 year olds; and
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New rules on the requirement for an employer to display their certificates of employer's liability insurance. It will become sufficient for the certificate to be made available in electronic format that is reasonably accessible to employees.
Also coming into force, on 27 October 2008, are regulations making all agency workers eligible for Statutory Sick Pay (SSP).
Insolvency: what happens to the employees?
Recent events in the City have sparked interest in the legal position of the employees left jobless by insolvency.
The pictures in the news of employees leaving the offices of Lehman Brothers carrying boxes containing their personal possessions and saying emotional farewells to colleagues provide a very powerful image of the distress caused to employees when an employer goes bust. Read more.
If you require further information on any of the above topics, please contact Anne-Marie Balfour or your usual contact in the Employment group.