What about the dependent contractors?

There is much to mull over in the Taylor ‘Good Work’ Review. It proposes some significant changes to employment law that deserve serious consideration. I set out a whole list of them here. But a lot of attention is being paid to a change that, in itself, will have only a cosmetic effect – relabelling workers as ‘dependent contractors’

Here is way the Review puts it on page 35:

Government should retain the current three-tier approach to employment status as it remains relevant in the modern labour market, but rename as ‘dependent contractors’ the category of people who are eligible for worker rights but who are not employees.

There are also proposals for redefining the scope of employees and workers – but I’ll deal with those future posts. Here I just want to concentrate on their change of name and why I think its a bad idea.

First of all let’s be clear that this is not a ‘new’ status. We are not talking about a new category of person previously excluded from employment law who will now gain some new set of rights. This is just about what to call that group of people who are not employed under a contract of employment but who nevertheless qualify for rights such as the National Minimum Wage, or rest breaks and annual leave under the  Working Time Regulations.

I don’t see anything wrong with the word ‘worker’. I certainly don’t see that ‘dependent contractor’ is any better. But my objection is more practical than that. If this change is made, what will that do to the drafting of employment law?

Here’s the problem. Look at the definition of a worker in the Working Time Regulations.

“worker” means an individual who has entered into or works under (or, where the employment has ceased, worked under)—

(a) a contract of employment; or

(b) any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;

and any reference to a worker’s contract shall be construed accordingly

You can see that the term worker covers both employees and people employed under ‘any other contract’ under which they are personally obliged to perform work. The word ‘worker’ does not just apply to those other contracts, it applies to employees too. There is actually no name for the people in the ‘other’ category. They tend to be referred to in the case law as ‘limb (b) workers’.

So here is where the Taylor report goes wrong. it says that it wants to rename those ‘limb b workers’ as dependent contractors, but the legislation doesn’t give them a name at all. Whenever the word ‘worker’ is used, it refers to both employees and this wider (unnamed) category. I’ve picked the example of the Working Time Regulations but the same issue arises under the Employment Rights Act 1996, the National Minimum Wage Act 1998, the Trade Union and Labour Relations (Consolidation) Act 1992 and others.

To introduce the concept of ‘dependent contractor’ – which will not, the Report says, include employees – you would need to have two separate definitions: e.g.

’employee’ means an individual who has entered into or works under a contract of employment

‘dependent contractor’ means an individual who works under a contract…whereby the individual undertakes to do or perform work personally…

Then – whenever a right is set out, you would need to amend what the law says about who qualifies for it. Look at Regulation 11 of the Working Time Regulations:

Weekly rest period

11.—(1) Subject to paragraph (2), an adult worker is entitled to an uninterrupted rest period of not less than 24 hours in each seven-day period…

If we drop the term worker and replace it with ‘dependent contractor’ Regulation 11 would have to look like this

Weekly rest period

11.—(1) Subject to paragraph (2), an adult employee or dependent contractor is entitled to an uninterrupted rest period of not less than 24 hours in each seven-day period…

Basically, every time the current legislation refers to a worker, we would have to change the wording to say ‘an employee or a dependent contractor’. Some poor soul in the Department for Business will have to go through the whole statute book looking at each time the word worker is used and decide whether it needs to be replaced. Perhaps you could come up with some sort of ‘find and replace’ amendment – but why would you bother? What on earth would be the point?

Fundamentally,  why would the world be a better place if the definition of a trade union (section 1 of the 1992 Act) was an organisation:

(a) which consists wholly or mainly of employees and dependent contractors of one or more descriptions and whose principal purposes include the regulation of relations between employees and dependent contractors of that description or those descriptions and employers …

I think this is a rather silly idea that has already had far to much attention.

Let’s never speak of it again.

 

Posted in Employment status, Taylor Report, Uncategorized | 11 Comments

The Taylor Review – the good, the bad and and the cosmetic

It’s easy to pick holes in any substantial piece of work – which is great news for people like me. There is, therefore, plenty in the Taylor Review ‘Good Work’ Report (as it now seems to be called) that I intend to spend much of the summer picking holes in and whinging about (I mean – ‘dependent contractors’ – honestly!).

There is also much in the report that will be of more interest to other people than to me. There are graphs. There is discussion of National Insurance Contributions. There is plenty of stuff about promoting and sharing good practice that I frankly skimmed through. I don’t dismiss these things – but other people can write about them.

What I wanted to see from the review was substantive proposals for actual amendments in employment law – and in all fairness there are plenty of them. Some are a bad idea and some would make very little difference to anyone. But some of the proposals are really progressive and should be welcomed. We can argue about which is which later, but for now here are the proposals on employment law that I take from the report.

  1. Keep the distinction between employees and workers, but rename workers who are not employees ‘dependent contractors’ (Page 35)
  2. Amend the legislation defining employees and workers so that case law principles are reflected in the legislation itself – possibly with supporting secondary legislation  (page 35)
  3. Remove the requirement for workers (I refuse to use the ‘dependent contractors’ term) to have a contract to perform work personally (page 36)
  4. Place more emphasis on control in the definition of worker status (page 36)
  5. Consider taking account of the subtly different definitions of ‘worker’ in the legislation
  6. Retain need for personal service in employment contract
  7. Amend the law on the National Minimum Wage to make it clear that gig-economy workers allocated for through an app are undertaking a form of output work and will not have to be paid NMW for each hour logged on when there is no work available (Page 38)
  8. Treat workers treated as ’employed’ for the purposes of tax status (page 38)
  9. Extend the right to a written statement of terms to workers as well as employees (page 39)
  10. Require written statements to be given on day one of employment (page 39)
  11. Extend written statement of terms to include description of statutory rights (page 39)
  12. Give a stand alone right to compensation if employer has not given written statement (page 39)
  13. Consider increasing the rate of the National Minimum Wage for hours that are not guaranteed by the employer (page 44)
  14. Preserve continuity of employment where any gap in employment is less than one month, rather than one week  (page 45)
  15. Improve the information to be given to agency workers (page 46)
  16. increase the reference period for calculating holiday pay (where pay is variable) from 12 weeks to 52 weeks. (page 47)
  17. Allow holiday pay to be paid on a ‘rolled up basis’ (page 47)
  18. Give agency workers the right to request a direct contract with the end user after 12 months on an assignment (page 48)
  19. Give those on zero-hours contracts the right to request guaranteed hours after 12 months (page 48)
  20. Require employers to set up Information and Consultation arrangements when requested by just 2% of the workforce rather than the current 10% (Page 53)
  21. Require larger employers to report on their overall workforce structure – including requests from zero-hours workers for regular hours (page 55)
  22. Abolish the ‘Swedish Derogation’ which allows agencies to avoid matching end user pay by employing agency workers in a way that allows for pay between assignments (Page 59)
  23. Give HMRC enforcement powers in respect of sick pay and holiday pay as well as minimum wage issues (page 59)
  24. Allow claimants to being a claim to ET (without fee) to determine employment status as a preliminary issue prior to substantive claim (page 62)
  25. Place burden on employer in ET claim to prove that claimant is not an employee / worker (page 62)
  26. Give BEIS the power to pursue the enforcement of Tribunal awards – i.e. pursuing the actual award, not just imposing a penalty  for non-compliance (page 63)
  27. Allow ET to impose aggravated penalties on employer who does not apply  ET ruling on employment status to similar groups of workers (page 63)
  28. Allow uplifts in compensation where employer commits subsequent breaches of employment law based on similar working arrangements to those already dealt with by ET (page 64)
  29. Consider allowing flexible working requests to cover temporary as well as permanent changes to contracts (page 95)
  30. Reform SSP to make it a proper employument right available to all workers – accrued in line with length of service (page 99)
  31. Give individuals a right to return to work following  long-term sickness absence (page 99)

Some of these proposals are ‘ready to go’ and others would obviously require a great deal of work to turn them into something specific. For example, it’s all very well saying we need a clearer definition of who is an employee and who is a worker – but what would those definitions actually look like?

I plan to look at a number of these proposals in more detail over the summer and will, as ever, be blogging and Tweeting my thoughts. But before I start whinging and carping (and I will be doing a lot of that), it is worth acknowledging that this Report is a more substantial piece of work than the various leaks over recent days suggested. There is a lot of substance here that will form the framework of the employment law debate for the foreseeable future.

Good work.

 

Posted in Employment status, Taylor Report, Uncategorized, Zero Hours COntracts | Tagged , , | 2 Comments

Employment Status – in praise of fuzziness

As we await the publication of the Taylor Review of Modern Working Practices, one issue that is being discussed is whether the definitions of employee and worker need to be simplified and/or clarified. There is a general feeling that that the current distinction between the two is rather vague and fuzzy – as is the distinction between those who are either workers or employees and the ‘genuinely’ self-employed. Most people instinctively feel that vagueness in legal definitions is a bad thing as it leads to uncertainty. I’m not convinced.

Sarah O’Connor, the employment correspondent for the Financial Times, wrote recently about the need for clarity – arguing that you can’t expect people to ‘plough through reams of case law to figure out if they have been misclassified’ and that ‘there is little point in having employment rights if no-one really knows to whom they apply’.

Its certainly a fair point and it chimes with the Law Society’s submission to the Taylor review in which it urged the clarification of employment status.To its credit the Law Society puts its money where its mouth is and actually proposes new definitions of worker and employee that it feels would lead to greater clarity and understanding. Here is their proposed definition of an employee:

A person in paid work is an employee if:

  1. (a)  they provide work under a contract of service or apprenticeship, whether express or implied; and
  2. (b)  the contract places an obligation on the employer to provide work, and the individual to accept and execute allocated work personally; and

(c) the employer retains control over how the work will be carried out, for example:

  1. where the work will be executed,
  2. how activities will be performed,
  3. the hours during which the work is to be performed; and

(d) the contract provides for regular remuneration by the employer regardless of the level of profit enjoyed by his business.

Be honest. Do you read that definition and think ‘Oh it all makes sense now!’? This attempt simply shows that clarifying employment status is easier said than done. Personally I don’t see how taking principles from leading cases and bunging them into the statute helps us very much. The Law Society’s proposed new definitions don’t really add anything. In fact, look at their proposed definition of a worker:

A person in paid work is a worker if they work (or worked):

  1. (a)  under a contract of employment (or other contract) whether express or implied; and
  2. (b)  the contract places an obligation on the worker to personally perform allocated work or service in a manner stipulated by the employer; and

(c) the contract does not provide that the worker will work exclusively for the employer; and

(d) the status of the employer is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the worker.

It seems to me that the line about performing work ‘in a manner stipulated by the employer’ is rather restrictive and  would actually have the effect of narrowing the scope of the law. Im sure that is not what is intended but it does show that coming up with a simple and clear definition is far from easy.

The essential problem with employment status is not that the definitions are vague, but that there is an incentive for employers (using the term in its broadest sense) to seek to limit an individual’s rights by drafting a ‘self-employed’ contract when in practice it is no such thing.

If we come up with new statutory definitions then that will simply give those employers a clearer target to aim at. If we specify that an employment contract is one which ‘provides for regular remuneration by the employer regardless of the level of profit enjoyed by his business’ – as the Law Society proposes – then some employers will draft clauses providing for pay to be reduced when the employer makes a loss. We would then see a whole new line of cases looking at how much variation in pay would take the contract outside the definition of employment and people would start arguing for the need to clarify the law all over again.

What we need is a system in which the Tribunal is able to cut through the terms drafted by lawyers and look at the reality of the situation. That’s what they try to do already – but they are not free to put aside the written terms of the contract without good reason.

I don’t think it should be a contractual analysis at all.

Where one person sells their labour to another then I think employment law should apply to that relationship unless the ’employee’ can be said to be in business on their own account. Whether they are genuinely running their own business should be a matter for the tribunal to decide, with a key factor being whether they seek to provide their services to the world at large or whether they depend on a particular ’employer’ to make their living.

I don’t see the need for a difference between employee and worker status – let’s just give full employment rights to everyone who works for someone else. Unfair dismissal is a pretty limited right anyway and redundancy payments are modest. I don’t see that this expansion of rights would create any great hardship for employers – and it would eliminate a lot of confusion. While we’re at it we could align tax law with the new definition and remove the incentive for many employees to play along with the rather artificial notion that they are self-employed.

Coming up with a new ‘clear’ definition of employment status is a hiding to nothing. Whatever definition is arrived at will simply create new and profitable areas of doubt and uncertainty. Removing the definitions would limit the scope for employers to draft their way out of employment law and free tribunals up to do justice between the parties. Clarity and certainty sound like good ideas, but in this context they are a mirage and there is no point in chasing them. Let’s go for fuzziness instead.

Fuzzy, but fair.

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Banning employees from wearing headscarves

Let’s get one thing clear at the outset. The European Court of Justice has not said that it is OK to ban Muslim employees from wearing headscarves. It really hasn’t.

But the decision in Achbita v G4S Secure Solutions NV is nevertheless important and controversial. Ms Achbita was dismissed from her job as a receptionist because of her insistence on wearing an Islamic headscarf when she was at work. The employer had a policy of ‘neutrality’ which required employees to refrain from wearing any visible signs of their political, philosophical or religious beliefs in the workplace.

What the ECJ has decided is that the dismissal of Ms Achbita in pursuance of that policy was not direct discrimination on the grounds of religion or belief. The Court based that conclusion on the fact that the rule in issue applied to all employees and all visible signs of political, philosophical or religious beliefs ‘without distinction’. There was no evidence that Ms Achbita was treated differently to any other worker.

Now I’m not entirely happy with that reasoning. The employer objected to fact that Ms Achbita dressed in a way that identified her as a Muslim. The fact that it would also have dismissed a Sikh employee wearing a Turban, a Jewish employee wearing a kippah or a Christian wearing a crucifix is beside the point – and if anything, makes it worse. I think it is a red herring to say that the policy treats everyone the same – it is consciously aimed at people with particular religious beliefs. Of course, it is also consciously aimed at those with philosophical or political beliefs but that is hardly comparable. Wearing a T-shirt with a slogan is not the same thing as wearing something that you believe to be a requirement of your faith.

I can accept that this is a tricky issue – and so perhaps the best way of looking at a policy like this is to consider indirect discrimination. We have an apparently neutral policy – ‘don’t wear anything that identifies your religion, political beliefs of philosophy’, which causes a particular disadvantage to people who share a protected characteristic – like being a Muslim.   The issue under the Equality Act 2010 is then whether the employer can show that its policy is a ‘proportionate means of achieving a legitimate aim’. The way in which this is approached by the ECJ is to ask whether the means adopted by the employer of achieving the aim are ‘appropriate and necessary’.

For reasons that are not entirely clear, the ECJ was not asked about indirect discrimination by the Belgian court, but it nevertheless thought it would be useful to give some guidance.

The Court said that a desire to display a policy of political, philosophical or religious neutrality ‘must be considered legitimate’. Further, translating that policy into a rule about how employees dress is appropriate – providing the policy is pursued in a ‘consistent and systematic manner’. As to whether the policy is ‘necessary’ the ECJ said that that would depend on whether it was limited to employees in a customer facing role. If it was, then the policy would be doing no more than was necessary to achieve the legitimate aim. The Court suggested that the Belgian court could then consider whether, instead of being dismissed, Ms Archbita could have been offered a role that did not involve interacting with customers.

Personally I’m not convinced that hiding Muslim employees away from customers is the best way to go here. In fact I have a problem with the whole ‘neutrality’ question. Excluding anyone from a customer facing role if they are visibly of a particular faith doesn’t seem very neutral to me. I certainly can’t see the argument working in Britain. Our approach to equality is based more on diversity than neutrality and I can’t imagine a tribunal looking favourably on an employer sacking an employee who is visibly Muslim, Sikh or for that matter visibly anything.

Neutrality has a cultural meaning and significance in Belgium and some other European countries that it does not have in Great Britain (Northern Ireland is a special case where the idea of a ‘neutral’ workplace is a key part of the fair employment regime). So just because the ECJ thinks that this Belgian employer has established a legitimate aim, that does not mean that a British Tribunal should also accept a similar policy as being legitimate.

There are of course reasons why particular items of religious dress may be inappropriate for the workplace – see the 2007 case of Azmi v Kirklees Metropolitan Borough Council for an example of an employer legitimately objecting to an employee wearing a veil at work. But I would expect a British Tribunal to focus on the practical impact of the clothing in question, rather than the message it sends. I struggle to think of jobs in which wearing a headscarf would cause genuine practical problems.

So my view is that a policy which ‘bans’ headscarves at work will be unlawful. We could write a thesis or two about whether it would amount to direct or indirect discrimination, but the result is the same. You shouldn’t ban employees from wearing headscarves (or turbans, or crosses or kippahs) unless those items cause genuinely prevent the work from being done properly or safely. In the vast majority of cases, they won’t.

Posted in Equality Act, EU law, Indirect discrimination, Religion in the workplace, Uncategorized | Tagged , , , | 3 Comments

Pimlico Plumbers and the ‘self employed’ worker

Employment status is clearly going to be this year’s hottest employment law issue.

tap

Just last week the Government published its Employment Status Review. It is dated December 2015 so it has been sitting on someone’s desk for over a year. That certainly isn’t because it is too radical. It reads like a dissertation written by a student struggling to get to grips with the decades of case law on the difference between employees, workers – and people who are neither. Its main conclusion is that ‘it’s all very complicated’ and it’s hard to disagree. However the Review does not go on to propose any change in the law. It ends with a ‘more work is needed’ conclusion which is the policy equivalent of ‘well it beats me’.

So Charlie Mullins, the owner of Pimlico Plumbers, is in good company when he says that ‘we can’t get our heads around this word ‘worker’ and what it means’. His comments come after the Court of Appeal upheld a Tribunal’s finding that a ‘self employed’ plumber that he engaged was a ‘worker’ and able to claim paid holiday under the Working Time Regulations 1998 and disability discrimination under the Equality Act 2010.

As with many unsuccessful parties, Mr Mullins’s first reaction is that he will appeal to the Supreme Court. But he won’t be allowed to. The case of Smith v Pimlico Plumbers is high profile – but not legally ground-breaking.  Mr Smith was not an employee, but he was a worker. It may seem odd to Mr Mullins that a ‘self employed’ plumber can qualify as a worker, but it’s a common enough finding in the world of employment law.

[Added 9 August 2017:

Ha! Shows what I know. The Supreme Court has now given permission to appeal. I’m genuinely surprised by this as I don’t see any point of law here; the case turns on its facts. Perhaps the Supreme Court is looking for an opportunity to ‘sort out’ worker status. If so, I suspect Mr muslin’s won’t like the eventual outcome, but we shall have to wait (for about a year) and see.]

The main reason that Mr Smith was held not to be an employee was that the employer was not obliged to offer him work on any particular day and he was not obliged to accept any particular job. More convincing, to my mind, was the fact that he was able to arrange his business affairs to his own advantage. He was responsible for obtaining materials and supplies himself and could charge his employer a mark-up on materials that he then used on a job. He also deducted business expenses for tax purposes – including for the use of one of the rooms in his house as an office and payments made to his wife to cover admin.

These factors certainly seem to put him outside the accepted definition of an employee. But there is nothing odd or contradictory about him still being classed as a ‘worker’. All that is needed is an obligation on him to perform work personally, with the caveat that the ’employer’ should not be the client or customer of a business that he was operating. After a detailed examination of the contract and associated documents the Tribunal held that he met that definition and the Court of Appeal has agreed. Legally there is nothing much to see here. This is just one more example to add to the many that have built up over the decades.

Mr Mullins has criticised Mr Smith for wanting to have his cake and eat it – to take the benefits of self-employment but also want the protection of employment law. That, to be frank, is a bit rich. If there is any ‘cake eating and having’ going on it is surely on the part of the employer. It engages plumbers to wear its livery and conform to its standards while providing services to its customers. Those plumbers must be available for work on a full-time basis and are required to ‘maintain a high standard of conduct and appearance’ at all times. They are also subject to the rules and policies set out in a company manual. In a number of respects, Pimlico Plumbers behaves as though it is an employer of plumbers. It is hardly in a position to complain if that carries through into some of the legal obligations that being an employer entails.

Frankly, I find the case law on employment status downright tedious and I would be delighted if we could just rethink the whole thing. We have a whole suite of employment laws – but have we thought properly about who should they protect? If we started from scratch would we really base our answer on issues like ‘control’ or ‘mutuality of obligation’? Why should the fact that a worker has the right to nominate a substitute mean that he or she does not qualify for paid holidays? Why should depending on more than one ’employer’ to make a living as a freelancer mean that you have no protection against discrimination? Why should the fact that someone chooses when and how they do their work mean that we can dispense with their services without behaving reasonably?

The Employment Status Review does not pose these questions. But I am more hopeful that the Review of Employment Practices in the Modern Economy being led by Matthew Taylor might. It would be good to see some really fresh thinking on the issue.

Perhaps we should not expect too much, however. It is difficult to see how you could redesign the system without expanding the scope of employment rights. Would the Government really be prepared to increase the burden on business in this way? My fear is that Matthew Taylor will come up with something radical and forward thinking and the Government will respond by saying ‘well it’s all very complicated’ and ‘more work is needed’.

 

Posted in Employment status, Uncategorized | Tagged , , , , | 2 Comments

The Range of Reasonable Responses Podcast

So I thought I’d give podcasting a try.

Since talking about employment law is essentially what I do it seems to make sense to do  things where I talk rather than write – and I thought it would be a good opportunity to look at some wider issues than the ones I write about on this Blog.

In an opening series I’m looking at classic employment law cases like BHS v Burchell, Polkey, James v Eastleigh and others as well as the way in which the courts have dealt with sex discrimination in dress codes.

If that sounds interesting then you can find the Range of Reasonable Responses Podcast here

You can also subscribe through iTunes if that’s how you listen to your podcasts. Just search for a ‘Range of Reasonable Responses’.

I’ll still be writing on this blog when employment law hits the news, so don’t go away!

 

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Can you afford to ignore the Gender Pay Gap Regulations?

Actually, I think you can.

Probably.

I mean what’s  the worst that can happen? While other large employers publish their gender pay gap information you simply sit back and say. “Not for us, thanks, we’re fine.”

Of course many people will be disappointed in you. Some may even be angry and there might be ‘damaging publicity’. But if you don’t care about those things, can anyone actually do anything about your failure to publish the information that is required?

mind-the-gap

The  Equality Act 2010 (Gender Pay Gap Information) Regulations 2017  don’t impose any sanction for failure to comply with their requirements. In fact, the Regulations don’t even seem to contemplate anyone not complying with them. There is nothing in the Regulations themselves to say what happens if an employer just chooses
to ignore them altogether.

The Government has, however, tried to create the impression that the Regulations have some teeth by making this  point in the explanatory notes:

Failure to comply with an obligation imposed by these Regulations constitutes an ‘unlawful act’ within the meaning of section 34 of the Equality Act 2006 (c. 3), which empowers the Equality and Human Rights Commission to take enforcement action.

So the Equality Commission can enforce the Regulations by taking action against employers who fail to comply?

I’m not convinced.

This is an assertion made in some explanatory notes. It is not part of the Regulations themselves.  This is important. The Regulations do not provide that a failure to comply is an unlawful act; the Government is merely asserting that. And I think they are wrong.

Section 34 of the 2006 Equality Act (this Act sets up the Equality Commission and should not be confused with the 2010 Act which actually contains the substantive law on discrimination) defines the word ‘unlawful’ as meaning ‘contrary to a provision of the Equality Act 2010’. So, for example, an act of direct or indirect discrimination will be an unlawful act. The Commission then has powers to investigate employers who are suspected of committing unlawful acts and issuing them with notices or ultimately taking legal action aimed at preventing them from committing further unlawful acts in the future.

Is a failure to comply wth the gender pay gap regulations an unlawful act? What provision of the Equality Act is it ‘contrary to’? The Gender Pay Gap Regulations are issued under s.78 of the Equality Act. But s.78 does not require an employer to do anything or prohibit an employer from behaving in a particular way. It merely gives the relevant Minister a power to issue regulations which require employers to publish information. If an employer doesn’t publish that information then they will be in breach of the Regulations – but they will not be in breach of a provision of the Equality Act. Section s.78 does not impose the requirement, the Regulations do.

Section 78 itself acknowledges this fact. Look at s.78(5):

(5) The regulations may make provision for a failure to comply with the regulations—
(a) to be an offence punishable on summary conviction by a fine not exceeding level 5 on the standard scale;
(b) to be enforced, otherwise than as an offence, by such means as are prescribed.

This shows that Parliament intended that the issue of the enforcement of Regulations should be set out in the Regulations themselves. It could have added that a failure to comply with the Regulations would be deemed to be an unlawful act within the meaning of the 2006 Act – but it didn’t.

When Parliament adopts the Regulations it will have chosen to make no provision for a failure to comply with them. This attempt to make out that the Equality Commission will nevertheless swoop in on any recalcitrant employers is just misleading. Even if the power were there, the Commission is hardly resourced to police the compliance of thousands of employers up and down the country.

Now I’m not arguing that employers should just ignore the Gender Pay Gap Regulations. That could cause all sorts of awkwardness. But in deciding how much resource and energy to devote to strict compliance with them it is perhaps worth bearing mind that there is no realistic way of challenging the figures that an employer comes up with.

Employment law is going through a bit of a lean patch at the moment and Regulations like these can be seized on with great enthusiasm by those of us with a living to make advising employers on how to comply with the law. But let’s not make more out of these Regulations than they deserve. They don’t create real legal obligations and (whisper it) will do little or nothing to reduce discrimination or increase equality. A sense of perspective is needed here, I think.

NOTE: All of the above applies in relation to the Regulations applying to employers in the private sector. Similar Regulations are also being introduced which will apply to public sector organisations with 250 or more employees. They will be much harder to ignore as they will form part of the employer’s equality duty under the Equality Act 2010. While that can’t be enforced by individuals per se, bodies could be vulnerable to judicial review procedures if they do not comply with their duty and the Equality Commission has specific powers to assess their compliance and take appropriate action.

 

Posted in Equal pay, Equality Act, gender pay gap | Tagged , , , , | 3 Comments