Employment Law and The Riots
The recent events in England throw up a number of employment law issues which are affecting businesses in London and other major cities. As we write the situation looks like getting worse before it gets better
So. What are those issues and how should employers deal with them if their businesses are affected or damaged by rioting?
The first point I think needs to be made is that some employees may not be able to get to their place of work due to closure of public transport, roads etc. In our view these should be treated in a similar way to circumstances where employees cannot attend work due to adverse weather. Employers may wish to make appropriate enquiries to ensure that staff are making reasonable efforts to attend work. If not, then there is no difficulty in requiring the employee to take day's unpaid leave. However, if the reason for the absence is genuine, then the employer may wish to take a different approach.
Remember, that where an employee does not make themselves available for work, whatever the reason for that, they are not entitled to be paid regardless of the reasonableness of their excuse. That said, employers may appear heartless, if they simply deduct the day's wages. An option therefore for the employer is to pay the employee despite the fact that they have not attended work. If the employer is not minded to do this then they have the option of either requiring the employee to take a day’s holiday or alternatively pay for the day and asking the employee to make up the hours at a later time.
Another issue that we need to take cognisance of is if an employee does not attend work and claims the reason for this was that he or she feared for their personal safety. In the circumstances employees are protected under Section 100 of the Employment Rights Act 1996 which states inter alia:
(1)An employee who is dismissed shall be regarded for the purposes of this Part as unfairly dismissed if the reason (or, if more than one, the principal reason) for the dismissal is that—
(d)in circumstances of danger which the employee reasonably believed to be serious and imminent and which he could not reasonably have been expected to avert, he left (or proposed to leave) or (while the danger persisted) refused to return to his place of work or any dangerous part of his place of work, or
(e)in circumstances of danger which the employee reasonably believed to be serious and imminent, he took (or proposed to take) appropriate steps to protect himself or other persons from the danger.
It is crucial to note that employee an dismissed for leaving or not attended work when they reasonably believed that their health and safety were compromised will be automatically unfairly dismissed if that is the principal reason for dismissal. There is no qualifying service to bring this claim.
Back to the more conventional employment law problems, what if an employer is faced with his premises being damaged or destroyed and has no work to offer his employees.
One aspect clients will need to consider urgently is the terms of their business all risks policy. In particular, is the damage covered or excluded because the damage was caused by rioting and civil unrest. The client’s insurance broker will be best placed to provide this information. In addition, the consequential loss section may cover the payment of vital staff whilst the business is closed. If such a clause can be activated this may avoid unnecessary worry on the part of the employee and of course the danger for the employer that when it reopens the business in does not have staff to service customers.
The rest of this advice covers circumstances where consequential risk insurance does not cover the situation the client is faced with. In some cases clients may have other premises that can relocate staff to. That being the case and staff being willing to relocate a number of potential problems can be obviated.
Difficulties however will occur if the client does not have other branches they can transfer employees to or if the employee is unwilling or unable to transfer. In those circumstances a number of options may be available. If there is a layoff clause in the contract of employment, employees can be laid off for up to 4 consecutive weeks or six weeks in any 13 week period. Employees will be entitled to guaranteed pay. The current rate is £22.20 a day or £111 per week. Guaranteed pay is only payable for five days in that 13 week period.
If the employer is unable to guarantee work after four consecutive weeks of layoff or six weeks layoff in the 13 week period the employer may face a claim for redundancy pay via the L.O.S.T (Lay Off Short Time) process which applies when an employer does not have work to provide the employee with.
Another possibility, particularly as we are at the height of the summer is for employees to take some paid holidays during this period. This is likely to be a short-term rather than longer term fix and again, employees may need to consent to being required to take holidays at this time unless the can be compelled to take holidays in their contacts of employment.
Finally, if none of these options are realistic or provide a satisfactory solution to the employer and/or employee, then the employer is faced with a potential redundancy situation. If there are 20 or more redundancies being proposed, then the collective consultation processes come into play in accordance with section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992. Given the circumstances, it may be that an employment tribunal would say that there were special circumstances that excused a failure to consult where the business ceased operating so suddenly and unexpectedly. However, cases where lack of consultation has been excused are few and far between and employers will need to tread carefully in the circumstances, especially if the business as a legal entity continues to exist.
Where there are less than 20 employees affected the normal consultation should still be embarked upon. However, practical difficulties may arise if the employer has no premises to conduct consultation in. Again, a pragmatic approach may need to be taken and consultation by telephone, correspondence or meeting at a local hotel etc should be considered. In all this will be a difficult time for everybody involved and employers and employees should be encouraged to discuss the situation and come up with practical solutions which suit everybody.
As ever our advisors are on hand to assist you should you need help on this difficult subject.