UK Employment Hub 

New legislation is expected to be implemented to ban restaurants from keeping tips from their employees. The intention is restaurant owners will not be able to make deductions from tips which are paid by card in order to fund administration costs.

It is reported that High Street chains regularly take up to 10% of tips paid by credit or debit cards from employees. The issue was initially addressed two years ago in an official review led by the then business secretary, Sajid Javid, although nothing concrete had materialised.

The government is now re-addressing the issue, announcing that UK legislation will not only ensure workers get the tips they deserve, but will also give customers reassurance that the tips they leave are for the service they receive.

The announcement of new legislation is a timely reminder to employers of the protections that employees are entitled to during the course of their employment. Employers should adopt a proactive approach and re-evaluate their tipping procedure in order to avoid non-compliance and reputational risks.

New tax rules coming into force on 6 April 2018 will mean that income tax and national insurance contributions (NICs) must be paid on all payments in lieu of notice (PILONs) on termination of employment.

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In this issue we look at some of the key employment law developments that have been taking place over the past month. In our case law review we take a look at ‘deemed disabilities’ under the Equality Act following a recent EAT judgment. We also look at what happens if an employer does not know an employee is pregnant when deciding to dismiss but finds out before the dismissal takes effect. The impact of the new taxation of termination payments coming into force from 6 April 2018 and the sponsor licence reporting process to be mindful of when involved in mergers and acquisitions are also covered.

https://www.dentons.com/en/insights/newsletters/2018/march/29/uk-employment-law-roundup/uk-employment-law-round-up-march-2018

Events

Earlier this week it was announced that the Real Living Wage has been increased from £8.45 to £8.75 per hour across the UK and from £9.75 to £10.20 per hour in London. The changes have been driven largely by inflation, higher private rents and transport costs, and the new figures have been calculated to reflect the actual cost of living required in order to sustain a decent quality of life in the UK and London.

However, the Real Living Wage remains voluntary, unlike the mandatory National Living Wage put in place by the Government. Further, despite more than one thousand employers signing up to pay the Real Living Wage since Living Wage Week last year (including Google and Ikea), 5.5 million people across the UK (comprising 21% of the workforce) are still being paid less than the Real Living Wage. One of the criticisms of the Living Wage campaign was that it targeted sectors that do not tend to have significant numbers of low paid staff – as such, it may not, as yet, have had the desired impact for those who need it the most.

Further, there have been questions around how employers are offsetting the additional cost of meeting the Real Living Wage – some employers have cut overall pay packages to mitigate the costs of increased pay, for example stopping overtime rates and cutting back hours. As such, the overall benefit being passed to employees is, in some cases, questionable.

On a more positive note, the increase in the Real Living Wage will see more than 150,000 employees get a pay rise, as more than 3,600 employers have now signed up to pay the Real Living Wage since it was introduced. Among these is Heathrow, which is set to become the first Real Living Wage airport by the end of 2020.