Whether you have one small franchise or a multi-branch portfolio, if you have employees, it is crucial to get to grips with employment law. Employment law encompasses a multitude of different areas, from employment contracts, employee rights and protections, to statutory hurdles which are necessary to overcome.
Some of the basic things to consider include the statutory rights of an employee. These include the right to a written contract, an itemised pay slip, to be paid at least the national minimum wage, the right to at least 28 days paid holidays (including bank holidays) and, in some cases, paid maternity, paternity or parental leave. Failure to comply can leave employers with hefty fines.
Contracts of employment are important for both the employer and the employee. A well drafted contract gives certainty to both parties. It is vital that the contract adheres to the relevant employment laws at the time, and are regularly reviewed and updated. The contract should set out the employee’s duties, responsibilities, rights and employment conditions. It should be clear on whether other employment policies, for example, those within a Staff Handbook (see below) are contractually binding.
We have extensive experience in drafting and advising on contracts and staff handbooks. Both documents are increasingly important and the need for precise drafting is key, especially in complex areas such as restrictive covenants and absence management. It is also imperative that these documents are kept up-to-date, considering the frequent changes to UK employment legislation. A poorly drafted or out-of-date contract/staff handbook can cause all sorts of problems for employers when workplace issues arise, whereas taking the time to get it right from the outset will invariably prove a great source of assistance in respect of dealing with staff issues when they arise.
Here is a quick overview of other responsibilities for employers to be aware of in relation to employment law (this list is by no means exhaustive):
• Before recruiting, you must check that the candidate is eligible to work on the UK. If they are not, you could face a substantial fine. You must also actively avoid discrimination in recruitment advertising and selection procedures.
• If your employees are on the PAYE scheme, you must deduct tax and National Insurance contributions from their pay. Your business also has to pay NI contributions.
• By 2018 employers must automatically enrol workers into a workplace pension scheme if the employee is aged between 22 and pension age, if they earn more than £10,000 per year and if they work in the UK.
• Employers have a common law duty of care to their employees, and are responsible for their employees’ wellbeing at work. This includes health and safety responsibilities and compliance, issues relating to discrimination, bullying, maternity/paternity/parental and adoption leave.
• Employers must comply with the Health and Safety Act, which in practical terms means that you must, where applicable, carry out a thorough risk assessment, have a health and safety policy and a paper-trail for recording injuries and accidents at work.
• Another area of responsibility is ensuring that workers are able to access their rights under working time legislation. This is an important area of law because, once again, it combines both employment and health and safety legislation.
• Employees must be allowed a minimum amount of ‘rest’ per day and per week in order to meet the Government’s requirements. Again, this applies from the first day of employment and looks to ensure that workers have the opportunity to take a break from work so that their health and safety is not compromised.
• Employees are entitled to statutory sick pay commencing the fourth consecutive day they do not attend work due to illness.
• Employers must also have liability insurance if they employ anybody, even if they are just part-time casual workers. Fines can be up to £2,500 per day if this is not in place.
• Dismissal, disciplinary and grievance rules should be set out in writing.
• Employees are also entitled to time off for a number of different reasons and in the event of certain circumstances/occurrences. For example emergency leave and maternity leave should be available in addition to standard holiday entitlements. Employees are also eligible to ask for flexibility in terms of working hours.
• Employers must ensure that workers are paid correctly in accordance with both their contract of employment and legal obligations. They must be aware of the National Minimum Wage, and the National Living Wage regulations.
Taking on a Franchise or expanding and employing new staff should be an exciting prospect; however it is important to make sure that you and your business adhere to all the necessary laws and regulations when employing a growing team. Similarly, it will be important to ensure, as a Franchisor, that your business reputation is not harmed by poor employment practices carried out by others.
In either case our Employment Law team are ideally placed to give you expert advice, from setting up your documentation, ensuring that you are meeting the necessary legal requirements, to assisting you and representing you if things do go wrong.