HR CIPD Supporting good practice in Managing Emplayment Relations 2250 words

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You have been asked to provide guidance to a local farm park. This is a relatively small organisation, with just 25 permanent employees. However, during the summer months the number of employees increases threefold due to the extra work that comes from local tourists visiting the park. A number of issues have arisen, and you are required to advise on each. To assist you in your deliberations, the issues have been grouped into three sections. You should provide a written response to the employer, with approximately 750 words for each of the three sections. The sections are attached....

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Supporting good Practice in Managing Employment Relations (3MER) Scenario You have been asked to provide guidance to a local farm park. This is a relatively small organisation with just 25 permanent employees. However during the summer months the number of employees increases threefold due to the extra work that comes from local tourists visiting the park. A number of issues have arisen, and you are required to advise on each. There are 3 sections for each of the three learning outcomes. Each section should consist of approximately 750 words Learning Outcome 1: (750 Words) Assessment Criteria: 1.1, 1.2, 1.3 The impact of employment law at the start of the employment relationship. 1.1 Describe at least two internal and two external factors that impact on the employment relationship. Choose 2 from each column – total of 4. External Factors Economic Government Legal Social Technological Internal Factors Culture Procedures Contracts Trade Union Organisation Structure and Strategy Internal Labour Market 1.2 Explain the 3 different types of employment status Types of Employment Status Employee Worker Self Employed In this section you should write about the tests to determine employment status: the Control Test, Mutuality of obligation, Entrepreneurial Test, Multiple Test. Reference: Employment Status: Questions and Answers, CIPD, November 2017; Employees and Workers: Information on determining a person’s employment status, CIPD. 1 1.3 Identify and analyse two reasons why it is important to determine an individual’s employment status: Reasons why it is important Tax reasons Liability Reasons Health and Safety Issues Statutory Rights (e.g. employees have more rights than workers and self employed individuals. Reference: Employment Status: Questions and Answers, CIPD, November 2017; Employees and Workers: Information on determining a person’s employment status, CIPD. Learning Outcome 2: (750 words) Assessment Criteria: 2.1, 2.2, 2.3, 2.4, 2.5 Understanding Individual rights of the employee during the employment relationship 2.1 Explain the importance of work-life balance within the employment relationship and how it can be influenced by legislation. Refer to at least three employment rights from the legislation Refer to the Working Time Regulation (1998) Highlight THREE rights from the regulation, such: Working Time Rest Periods Annual Leave Reference: Working hours and time off work: Understand the basics of the Working Time Regulations, working hours trends, holidays and special leave, CIPD Factsheet, October 2017 2 2.2 Summarise the legal support that may be given to employees as a family member: focus on TWO areas Write a brief overview of the family friendly legislation and then focus on TWO key areas such as: Maternity/Paternity Adoption Time off for emergencies Parental leave etc. References: Maternity, paternity and adoption rights: An introduction to maternity and paternity rights, shared parental leave, and adoption rights; CIPD, October 2017. Working hours and time off work: Understand the basics of the Working Time Regulations, working hours trends, holidays and special leave, CIPD 2017. Parental rights and family-friendly provision Q&As: Commonly asked questions on the legal issues relating to parental rights and family-friendly provision; CIPD, July 2016. 2.3 Explain why employees should be treated equally in terms of pay – Give TWO examples Include two examples from: Equal Pay Act National Minimum/Living Wage Right to itemised pay slip References: Equal pay: Explore the legal position in the UK surrounding equal pay as well as good employment practices; CIPD, April 2017. Statutory rates and compensation limits, CIPD, February 2018 The National Minimum Wage and Living Wage; www.gov.uk 3 2.4 Summarise the main points of UK discrimination legislation and how this might affect the approach to temporary employees. Refer to at least TWO forms of discrimination in your answer. Summarise the main points of discrimination legislation. Describe the protected characteristics and the situations in which discrimination could potentially apply. Refer to at least two of the forms of discrimination: direct, indirect, victimisation and harassment. References: What is discrimination?: Employers and Service Providers: Equality Commission: http://www.equalityni.org/Employers-Service-Providers/What-is-discrimination 2.5 Psychological contract and how effective organisation contribute and affect it. Explain the psychological contract and how it is not legally binding as an introduction. Focus on how organisation policies affect and contribute to it, i.e. explain the link between policies and the contract. References: The Psychological Contract, CIPD Factsheet, January 2018 Learning Outcome 3: (750 words) Assessment Criteria: 3.1, 3.2, 3.3 Understanding issues to address at the termination of the employment relationship 3.1 Explain the differences between fair and unfair dismissal including FIVE potentially fair reasons for dismissal Differences between fair and unfair dismissal Explain FIVE potentially fair reasons for dismissal Importance of ACAS Code of Practice: Disciplinary and Grievance Procedure References: Dismissal Procedures, CIPD Factsheet, April 2017. Discipline and grievance at work: Learn the fundamentals of disciplinary and grievance policies and practices in the workplace, CIPD Factsheet, August 2017. 4 3.2 Explain the importance and benefits of holding exit interviews with employees who are leaving the organisation. Explain what an exit interview is; benefits/importance but also limitations. Reference: Employee turnover and retention: Learn how to measure turnover and retention, and understand why people leave organisations. CIPD Factsheet, December 2017. 3.3 Explain the process of redundancy. Introduce what redundancy means. Summarise the key stages to be followed to manage redundancy, including collective consultation. References: Statutory rates and compensation limits, CIPD Factsheet, February 2018 Redundancy: an introduction: Learn how to use redundancy as a last resort when all alternative approaches have been considered, CIPD Factsheet, March 2017. REFERENCES Remember to list all your references …………… 5 Learning Outcome 1: 1.1, 1.2 and 1.3 – (750 words) The impact of employment law at the start of the Relationship The Employment Relationship This is simply the relationship between the employer and the employee. There are formal and informal aspects to the relationship and both parties have rights, obligations and expectations. The formal rights side is regulated through the provisions of the contract of employment and legislation sets common standards for the conduct of the relationship. The informal side of the relationship is governed by the psychological contract. The main task of those responsible for managing the employment relationship is to develop appropriate policies, and rules to promote good working relationships with those whom they employ. Think of your own organisation: • List all types of people or organisations that may be involved with and impact upon the employment relationship. • How many of these organisations or actors impact upon the day-to-day relationship, and which affect the relationship infrequently? Employee relations comprises: • • • • • Managing the employment contract and relationships Ensuring compliance with employment law Communication with employees Promoting involvement and engagement Collective processes of negotiation and consultation. 1 Learning Outcome 1: 1.1 - Internal and External Factors that impact on the employment relationship External Factors Economic Government Legal Social The economic environment has a huge impact on the employment relationship. During a recession, it is difficult to find employment and this leads to a buyer’s market whereby employers are able to find employees relatively easily It can also lead to a low turnover of existing staff as there are very few jobs to move to. Changes in the economy have led to organisations having to change their patterns of work, e.g. 24 hour shopping. Other economic trends include the loss of high street business to internet shopping. Organisations need to constantly change to meet the demands of the economic environment and employees need to be multi-taskers and be increasingly flexible. Government policies impact on employee relations. Currently a number of public sector worker are on a ‘pay freeze’ because of the poor economic conditions. There are benefits and policies to encourage the unemployed to apply for work. Other incentives include Tax Credits and the government launches initiative The legal environment will has a big impact on employee relations including such legislation such as the Working Time Directive, The Flexible Working Regulations, National Minimum Wage Act, Trade Union and Labour Relations Act. The Information and Consultation of Employees Regulations (often abbreviated to the ICE Regs) were introduced on 6 April 2005 and apply to businesses with 50 or more employees. The regulations give employees the right subject to certain conditions, to request that their employer sets up or changes arrangements to inform and consult them about issues in the organisation. Information and consultation are the basic building blocks of every effective organisation. Employees are consulted on a range of issues including: organisational performance, management performance, employee performance, job satisfaction etc Today's turbulent business environment makes increasing demands on managers and workforces, as competitive standards rise and expectations of individuals increase. Managers must respond positively to changes in contemporary workforce attitudes if they are to get the performance levels they need. The social environment has led to employees demanding a better work/life balance; and flexible working. Promoting WLB and flexible working enhances an organisation not only to employees but also among customers and the wider community. 2 Internal Factors Culture Procedures Contracts Trade Union Organisational culture can be defined as “the way we do thing around here”. The psychological contract would be an important aspect of this and managing the informal employee relationship. The informal employee relationship is important as it can influence how far the employee is prepared to exercise discretionary behaviour and work beyond the formal contract of employment. The psychological contract offers a framework for monitoring employee attitudes and priorities on those dimensions which can be shown to influence performance. Employees are increasingly recognised as the key business drivers. The ability of the business to add value rests on its front-line employees or 'human capital'. Organisations that wish to succeed have to get the most out of this resource. In order to do this employers have to know what employees expect from their work. An organisation’s policies and procedures have an impact on the employment relationship. Some policies are based on legal requirements; but others are there to follow the latest development in effective people management. An organisation may offer different types of contracts of employment – permanent, temporary, zero hours. A temporary contract may have a specified termination date, and there is an understanding that the job is not permanent. The worker may not make a claim for unfair dismissal, nor are they entitled to redundancy payments. A fixed term contract has a clearly defined duration with a start and finishing date. With a zero hours contract the worker is not guaranteed any paid work at all. The worker must be available to be called upon when there is a need. This type of contract may be offered to shop assistants to do casual work at busy periods, e.g. at Christmas.What affect does the various contrats have on staff relationships? The role of a Trade Union is to represent the rights of its members in terms of contractual pay and conditions but also gives a voice to the workforce. In recent years there has been a decline in the number of matters dealt with on a collective basis and an increasing focus on relationships with individual employees. This has resulted as there has been a significant decline in trade union membership; a significant decline in the number of employees covered by collective agreements and the increasing importance attached to the employee voice and employee involvement. In a recent CIPD survey on employee relations, nearly 60% of respondents in organisations recognise unions and think that unions exert a significant influence on their organisation. Public sector respondents are more likely to perceive trade union influence as strong. 3 Organisational Structure and Strategy Organisations are downsizing and delayering so that remaining employees have to do more. Employees may also need to be more flexible in skills offered and be able to multi-task as markets, technology and products constantly changing. Technology and finance are becoming less important than human resources as sources of competitive advantage. Traditional organisational structures are becoming more fluid. Internal Labour Market The internal labour market will have an impact on the employment relationship. The characteristics of this would include the skill level, type of work done. Etc. Highly skilled professional workers may have a fair amount of autonomy in their work and in flexible working conditions. 4 Learning Outcome 1: 1.2 – Explain the 3 different types of employment status Employment Status It is important to understand whether someone who is doing work for you is: • an Employee • a ‘Worker’ • self employed There is quite a lot of uncertainty about differences between workers and employees and the different rights that apply to them. It is important to determine employment status as employers will be liable for the majority of employment rights of employees; with workers having fewer rights. Differences are determined by what are called ‘common law tests’. Employees There is an important legal distinction between these categories of employment status. A person who is an Employee has a wide range of employment rights including: • Unfair dismissal • Statutory redundancy payment • Maternity and Paternity leave and pay • Parental leave • The right to request flexible working • Rights under TUPE • Rights to preferred payments in the event of the insolvency of the employer. Employees have a “Contract of Employment” and will receive benefits such as sick pay. As an employee, your rights include all of the rights workers have, plus the right to: • • • • • • • • a minimum statement of employment terms Statutory Sick Pay minimum notice periods if your employment will be ending (eg if your employer is dismissing you) protection against unfair dismissal maternity, paternity and adoption leave and pay request flexible working time off for emergencies Statutory Redundancy Pay Some of these rights require a minimum length of continuous service with your employer before you qualify for them. 5 Some employees may also have enhanced entitlements, over and above their statutory rights. These would be part of your employment contract's terms and conditions. For example, your employer could decide to give you more generous notice periods or sick pay. Workers 'Workers' are defined more widely than employees and are different from the genuinely selfemployed. The status of worker includes individuals working under a variety of contracts. Employees are workers, but employees have different employment rights and responsibilities than workers. Agency workers and short term casual workers are likely to be workers, unless they are found to be self employed. As a worker you are entitled to core employment rights, including the right to: • • • • • • • receive the National Minimum Wage protection against unlawful deduction from wages a minimum period of paid holiday (annual leave) minimum length of rest breaks to not work more than 48 hours on average per week or to opt out of this right if you choose protection against unlawful discrimination (including less favourable treatment on the grounds of part-time status) protection for 'whistleblowing' (reporting wrongdoing in the workplace) You may also be entitled to: • • Statutory Maternity, Paternity or Adoption Pay Statutory Sick Pay However, the entitlement to these depend on a number of different things, including how much the worker earns. The key requirements for establishing 'worker' status are that the worker: • • have to perform work or services personally and cannot send a substitute or subcontract the work are not undertaking the work as part of your own business (eg if the 'employer' is actually one of your clients) So Workers have some employment rights such as protection from discrimination. However Employees have additional rights including entitlement to written particulars of employment and protection from unfair dismissal. 6 Agency Workers Whether or not an agency worker has the status of an employee is a fluid area and is complicated by case law. If an agency worker is an employee of an agency with a contract of employment then that is a clear position. However it is often not so clear-cut as this. The Agency Workers Directive from The European Union gives temporary agency workers equal rights to permanent workers after 12 weeks employment. This would mean comparable pay and conditions including sick pay and holiday leave, but not other employment rights such as the right to not be dismissed unfairly or the right to redundancy payments. Self-employed Employment legislation does not generally cover self-employed people because they are, in effect, their own boss. They are protected on health and safety grounds and, in some cases, protection against discrimination. Self-employed people are usually identified by the fact that they are in business for themselves and provide a service to multiple clients. Self-employed people are generally more independent than workers. They have far greater control over how and when to deliver the service and who delivers it. They will usually be better able to protect their own commercial interests, although they will bear any financial risk from the business they operate. It is important to realise that the distinction of employment status is not always clear-cut and that employers may need to seek advice. 7 The table below provides guide to help understand the employment status of different people. The genuinely self employed have no employment rights unlike workers who are protected by the National Minimum Wage Regulation, the Working Time regulation and Equality rights. Table is drawn from the viewpoints of an Employer. Employee Worker Self-Employed S/he has a Contract of Service You pay by PAYE Does the work personally Has a Contract for Services You pay an invoice You pay on invoice S/he is not VAT registered S/he may be VAT registered s/he prepares business accounts You set the working hours Either may set the working hours S/he sets hours of workers S/he can’t decline work S/he can decline work You can expect work You cannot expect work. You provide written employment particulars S/he would be subject to disciplinary procedures The contract may not be in writing S/he may need to respond to complaints or may be subject to procedures in some cases. S/he may use own equipment. S/he works usually for a fixed time. S/he can assign work to others S/he has no right to expect work. Contracts for each piece of work could e written S/he must be prepared to respond to complaints but is not subject to disciplinary procedures. S/he uses own equipment S/he uses company equipment. S/he is employed for an indefinite time 8 The contract is by service, not time. Tests Used in Courts to Determine the Employment Relationship • The Control Test – What is the degree of control exercised by the employer The higher the control an employer has over the employee, the more likely it is that they are an employee. o Do the employers’ disciplinary procedures apply to the worker? o Who controls what work is done? o Who controls where the work is done? o What control is exercised over how the work is done? o Who controls when the work is done? o Who controls who does the work, particularly with respect to the right to delegate, send a replacement or hire staff to help. • Mutuality of Obligation - The minimum would comprise an obligation on the part of the client to pay the worker for work done and for the worker to be obliged to do the work. o How many engagements the worker performs and whether they are performed mainly for one person or a number of different people. o Commitment as evidenced by sick pay, holiday arrangements etc. o Commitment as evidenced by guarantee of work and guarantee of service. The absence of mutuality led to the conclusion that a worker was self-employed in a case concerning the payment of income tax and national insurance in the case of Parade Park Hotel v Comrs of HM Revenue and Customs which concerned a case where a worker carried out maintenance work for a hotel. The hotel did not have to offer him work, he was under no obligation to accept work and he provided his own tools and equipment. It was held that he was self-employed. • Entrepreneurial Test - The problem is looked at from a self-employed person’s point of view and the question asked “Is he in business on his own?”: Does he provide his own equipment? Hire his own helpers? Is there any degree of financial responsibility or degree of risk 9 • The Multiple Test – All the factors should be looked at and weighed up – no single factor can be conclusive. Using the multiple test an employment tribunal would take the following factors into account: o The contractual provisions o The degree of control exercised the employer o The obligation on the employer to provide work o The obligation the employee to do the work o The provision of tools, equipment, instruments. o The arrangements made for tax, national insurance, SSP, VAT o The opportunity to work for other employers o Other contractual provisions, including holiday pay, sick pay, notice, o Whether the relationship of being self employed is a genuine one or whether there was is an attempt to avoid modern protective legislation. o Power to substitute another worker o Whether the worker is ‘part and parcel’ of the other’s organisation. o The length of the relationship. Which working Relations may give rise to difficulties concerning employee status? Some examples of working relationships which often give rise to uncertainty surrounding employee status include for example: agency workers, casual workers, seasonal workers, consultant, homeworkers, teleworkers, pyramid sellers, temps, occasional workers, irregular workers, students, freelancers, clergy, fixed-term workers, cleaners, dentists, doctors lorry drivers, milkmen etc. 10 Learning Outcome 1: 1.3 – Analyse two reasons why it is important to determine an individual’s employment status Why the Distinction is Important There are a number of reasons for stressing the importance of this distinction between a Contract of Service and a Contract for Services. Tax Reasons Under the Social Security Contributions and Benefits Act 1992, an employer must pay secondary Class 1 contributions in respect of employed earners. Self employed earners pay a flat-rate Class 2 contribution and in addition a Class 4 contribution based on the gains or profits derived which are chargeable to income tax. They must also complete their own self assessment tax form. The employer does not need to deduct PAYE income tax in respect of his self employed contractors. But it is stressed that it is the substance of the relationship that will count, not the form. Thus if a person is an employee in the legal sense, the employer’s obligation will arise despite any artificial attempt or arrangement made to avoid such duties. In Jenning v Westwood Engineering Ltd the applicant was offered employment. He was told that he could work at a lower rate of pay on PAYE, or at a higher rate, paying his own tax and insurance, and he chose the latter option It was held that he was employed under a contract of employment nonetheless. With regards the national insurance contributions and administration there is financial gain in being self-employed as they don’t pay the same contributions. Liability Issues An employer will not normally be vicariously liable* for the civil wrongs committed by independent contractors whereas he would be so liable for torts** committed by his employees in the course of their employment which cause injury or damage to third parties. In Hillyer v St Bartholomew’s Hospital the plaintiff was liable,because the consultant was an independent contractor who was merely using the facilities of the hospital. On the other hand in Cassidy V Ministry of Health, a resident surgeon operated negligently on the plaintiff, and it was held that the hospital board as the employer was liable. *Vicarious liability – an employer is liable for the actions of employees during the course of employment. **Tort law deals with situations where a person's behaviour has unfairly caused someone else to suffer loss or harm. A tort is not necessarily an illegal act but causes harm. 11 Health and Safety Issues An employer owes a duty at common law to his employees to take reasonable care for their safety, whereas these duties do not normally apply with respect to his independent contractors. The duties owed by the employer to his employees under the Health and Safety at Work Act 1974 are more extensive than those owed to independent contractors. In practice this may mean a self-employed person who is injured whilst at work may be unable to claim any compensation from the employer, and additionally will be unable to claim industrial injuries benefit and/or sick pay. Statutory Rights Many statutory rights apply only to employees, not to workers. For example an employee is entitled to all the rights contained in the Employment Rights Act, including a written statement of terms of employment, itemised pay statement, maternity, paternity, parental and adoption rights; time off work, unfair dismissal, redundancy rights etc. The Flexible Working Regulations, Fixed-term Employee Regulations, Transfer of Undertaking Regulations etc apply to employees as does the Health and Safety at Work Act and many regulation issued On the other hand, the protection of wages, Part-time Workers Regulations, Working Time Regulations, the various pieces of discrimination legislation, the National Minimum Wage Act and part of the Trade Union and Labour Relations Act apply to workers as well as employees. 12 Employment Status: Questions and Answers, CIPD, 2017. The gig economy is a product of the digital age. It is a separate way of working with people undertaking temporary jobs or doing separate pieces of work, rather than working full time for an employer. Organisations may enter into short-term contracts with individuals who may be categorised as workers or employees The arrangements for those working in the ‘gig’, or ‘on demand’ economy (for example, couriers at Deliveroo, or drivers for Uber) may create uncertainties concerning their employment status. The categorisation difficulties for those working in the gig economy may be similar to issues surrounding part-time or casual workers. Simply because an individual works part time or works in the gig economy does not mean that they are not an employee – they may be an employee who works fewer hours. Case law Case:Aslam v Uber B.V (2016) and Uber B.V. v Aslam (2017) Type of work: Uber drivers Status: workers This test case for the tens of thousands of drivers working for Uber involved a careful analysis of the employment status of two drivers working for the smartphone app. Passengers use the app to locate a nearby driver to take them to their destination. The drivers did not claim they were employees, but workers and, therefore, entitled to a minimum wage under the National Minimum Wage Act 1998 and to paid leave under the Working Time Regulations 1998. At an employment tribunal, Uber maintained the drivers were running their own businesses as third-party contractors and, therefore, did not have worker rights. The company asserted it was only a technology platform and not a transportation business, although it had Passenger Service Vehicle licences under which the drivers operated. The following factors were relevant to the ET's decision that the Uber drivers were workers: • • The drivers provided their work under a contractual relationship and made themselves available to carry passengers to their destinations for payment Drivers could not develop their own businesses. For example, fare calculations were done by Uber, and deductions could be made to the drivers’ payments if passengers complained about overcharging. The decision that the estimated 46,000 Uber drivers are considered workers, has significant repercussions including a number of employment rights such as: • • 5.6 weeks of paid annual leave each year 48-hour maximum working week 1 • • protection from unlawful deduction from wages national minimum/living wage. An appeal from Uber against the ET's findings was dismissed by the EAT in a judgment on 10 November 2017. Uber is expected to appeal the EAT judgment too. The company is also embroiled in an appeal against TfL’s decision on 22 September 2017 not to renew its licence due to an alleged lack of corporate responsibility in relation to public safety and security. Other cases So far, decisions involving individuals in the gig economy indicate that many working arrangements will attract ‘worker’ status. Businesses operating within this sector have differing models and the area of law remains confusing; an employment tribunal could easily reach a different conclusion in similar cases. Other on-going cases involve courier companies eCourier and Excel. The gig economy has grown massively and organisations using such workers need clarity about the contractual and legal basis of their arrangements. (See Future developments for further information, including the Taylor review into modern working practices, which has considered the rights of those working in the gig economy and ‘worker’ status generally.) Case: Smith v Pimlico Plumbers (2017) Type of work: plumber Status: worker Relevant factors: • • • The plumber wore a branded uniform and had to work to company standards Customers made payments to the company rather than to individual plumbers There was no right of substitution. In this case, a plumber requested reduced hours following a heart attack. The refusal of this request led to unfair dismissal, disability discrimination and holiday pay claims. For the unfair dismissal claim, he had to show he was an employee. For the remaining claims, he had to show he was a worker. The Court of Appeal decided he was a worker but did not address whether he was an employee, as the plumber did not appeal against the employment tribunal’s previous finding that he was not. A key factor was that there was no right of substitution. This suggested a contract to work personally, rather than pure self-employment. The judgment emphasised that an unlimited right to substitute another worker suggests there may be genuine self-employment. However, a limited right to substitute a worker, for example, in cases of illness, can be consistent with a contract to work personally and can still lead to a finding of worker status. The case has been appealed again and is expected to be heard in the Supreme Court in January 2018. 2 How can employers work out if someone who is working from them is an employee? This question is crucial, yet is difficult to answer because there is no detailed definition of who is an ‘employee’ in the legislation. Accordingly, this question is decided by courts and tribunals on a case-by-case basis, and some guidelines for determining employment status have been laid down in various cases over the years. To decide if a particular worker is an employee the first item to consider is ‘control,’ in other words: • • • • • who controls what work is done who controls where the work is done what control is exercised over how the work is done who controls when the work is done who controls who does the work, particularly with respect to the right to delegate, send a replacement or hire staff to help. The higher the degree of control, the more likely it is that an employment relationship exists. The next key factor to look for is what is known as ‘mutuality of obligation', which is the obligation of the employer to provide work and the worker to do it. This will be indicated by: • • • how many engagements the worker performs and whether they are performed mainly for one person or for a number of different people commitment as evidenced by sick pay, holiday arrangements and so on commitment as evidenced by guarantee of work and guarantee of service. Where mutuality is present, there is likely to be an employment relation Other factors to consider when deciding whether an existing staff member is an employee, organisations should also consider: • • • • • • • • • • • • • the length of the relationship the method of payment agreed by the parties who provides the equipment needed to get the job done the degree of financial risk the degree of responsibility for investment and management the opportunity to profit from sound management in the performance of the task the labels or intentions of the parties whether the person performing the services has set up in business on their own account the degree of continuity in the relationship whether the worker works mainly for one person or for a number of different people whether the worker is ‘part and parcel’ of the organisation tax treatment may also be an indication, but not a conclusive one whether the worker can send a substitute to carry out the work. 3 Future world of work and rights of workers inquiry Some 4.79 million people are thought to be currently self-employed and 1.66 million employed on a temporary basis.Technology has changed the world of work and there is a need to balance the benefits of flexibility and the risk of exploitation. Several high-profile tribunal cases involving those working in the digital or ‘gig’ economy have focused political attention on the status and rights of workers in this sector. Many individuals cannot be certain what their employment status is until they are dismissed. Two government select committees launched separate inquiries into the gig economy and workers’ rights, and Theresa May commissioned a third, the Taylor Review, into modern employment practices. The core issue behind all these inquiries is whether the law’s approach to employment status can cope with new forms of work arising out of the digital economy, as illustrated by companies such as Sports Direct, Asos, Hermes, Uber and Deliveroo. The Taylor review ‘Good work: the Taylor review of modern working practices', published July 2017, has called for worker status to be replaced with ‘dependent contractor’ status. This would create a greater distinction between such workers and those who are genuinely self-employed or employed. The report makes a number of key recommendations. Employment status The report suggests: • • • • • retaining the current three-tier approach, but renaming those eligible for worker rights (but who are not employees) as ‘dependent contractors’ setting out the key principles of the employment status tests in legislation, with additional guidance providing an online tool to decide employment status in the majority of cases placing less importance on the requirement to perform work personally in developing the new ‘dependent contractor’ status placing more emphasis on control in the definition of ‘worker status’. • Dependent contractors This category would be given additional employment protections, including the right to a written statement of particulars, some minimum pay rights, and the ability to receive rolled-up holiday pay. • Gig economy The report suggests amending the law on the National Minimum Wage so that gigeconomy workers allocated through an app are considered to be undertaking a form of output work and will not have to be paid the NMW for each hour they are logged on when there is no work available. 4 Tax There is a recommendation to align employment status with the tax status framework in order to reduce differences between the two systems. For example, where a tribunal decides an individual is an ‘employee’ for tax purposes, that decision should also apply for employment law purposes. Employment tribunals Significant reforms to the tribunal process are also put forward, including quick preliminary tribunal hearings to decide employment status and placing the burden on employers in a tribunal claim to prove that the claimant is not an employee. Agency workers Suggestions include: • • • providing transparent information to agency workers, including rates of pay and details of those responsible for paying them introducing a right to request a direct contract of employment for agency workers placed with the same hirer for 12 months improving monitoring of umbrella companies and other intermediaries in the supply chain. Zero hours contracts The report suggested not banning these, but giving individuals the right to request a guaranteed hours contract after 12 months. The guaranteed hours could be based on the average weekly hours worked over the previous 12 months. Self-employed workers On this issue, the report suggests reintroducing the NI reforms abandoned after the 2017 spring budget, making NI contributions paid by employees and self-employed people more equal. It also recommends improving self-employed rights including pension provision and parental leave. Other wide-ranging aspects covered in the review include further measures to prevent pregnancy and maternity discrimination, reforms to sick pay, and new duties on employers to report the use of agency workers and zero hours contracts. The recommendations encompass many aspects of the working relationship, not just for those working in the gig economy. If the proposals are implemented with the correct guidance, this may go some way to addressing the many issues surrounding employment status and rights in the modern workplace. The government is expected to respond to the Taylor recommendations by the end of 2017. 5 uitis te Unit Nols Supporting Good Practice in Managing Employment Relations 3MER Level 3 Credit value 6 Assessment method Written response Expiry Date September 2018 Learning outcomes: 1. Understand the impact of employment law at the start of the employment relationship. 2. Understand the main individual rights that the employee has during the employment relationship. 3. Understand the issues to address at the termination of the employment relationship. Assessment Criteria Assessment Brief 301418 You have been asked to provide guidance to a local farm park. This is a relatively small organisation, with just 25 permanent employees. However, during the summer months the number of employees increases threefold due to the extra work that comes from local tourists visiting the park. A number of issues have arisen, and you are required to advise on each. To assist you in your deliberations, the issues have been grouped into three sections. You should provide a written response to the employer, with approximately 750 words for each of the three sections. 1. With the significantly increased workforce during the summer months, it is always difficult to predict what the actual workforce needs will be: 1.1 i. 1.2 ii. Describe at least two internal and two external factors that impact on the employment relationship. The employer is not sure whether the individuals who work on a temporary basis during the summer months are employees or not. Explain the different types of employment status that exist so that the employer is aware of them all. Using at least two examples, identify and analyse for the employer why it is important to determine the employment status of the individuals working at the park. 1.3 iii. 2. The work can be very demanding during the summer months. There have been occasions in the past when some of the temporary 2.1 39 co employees are working very long hours, and complaining about this. Explain the importance of work-life balance within the i. employment relationship and how it can be influenced by legislation. Refer to at least three employment rights from 2.2 the legislation. ii. Focussing on two key areas, summarise the legal support 2.3 that may be given to employees as a family member. iii. Using two examples, explain why employees should be 2.4 treated equally in terms of pay. iv. Summarise the main points of UK discrimination legislation, and how this might affect the approach to 2.5 temporary employees. Refer to at least two forms of discrimination in your answer. Explain how effective organisational policies can contribute to and affect the psychological contract. V. 3.1 3. The last summer brought about some significant problems relating to the permanent employees. The employer is concerned that the issues were not addressed correctly. Advise the employer about the following: 3.2 i. ii. 3.3 The differences between fair and unfair dismissals including five potentially fair reasons for dismissal. During the summer five of the permanent employees resigned. Explain the importance and benefits of holding exit interviews with employees who are leaving the organisation. Finally, the employer has a question for the future. The farm park has been struggling. If it were to make up to 10 employees redundant what process should it follow? iii. Evidence to be produced Written answers to questions of approximately 2250 words in total.
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Explanation & Answer

Attached.

Running head: WORK RELATIONSHIP

1

Work Relationship
Name
Institution
Class
Date

WORK RELATIONSHIP
1.

2

With the significantly increased workforce during the summer months, it is always

difficult to predict what the actual workforce needs will be.
I.

Describe at least two internal and two external factors that impact on the employment
relationship.
The contract is the agreement between the employer and the employee on the terms of

work can impact the employment relationship. A contract which is considered as an internal
factor encompasses, the nature of employment, hours required for one to work and the payment
as well as other allowances. Contracts are the first factor that affects the legal link between the
employer and the employee in the sense that it is what can make the relationship to exist or not to
exist. If a contract does not satisfy the employee, then he/she may not accept the relationship
(Rousseau, 1989). Similarly, a very attractive contract attracts the employee, and hence a
relationship is created with the employer. In the same way, honoring or the lack of honoring of
the contract by either party is likely to affect the employment relationship.
Procedures in the workplace are very significant for the success of a company and also
for the smooth running of the operations of a company. Procedures can be in place for the
working process or even as a chain of command (Coyle-Shapiro et al., 2004). In case procedures
are complex and making it impossible for the employee to work effectively, then the
employment relationship can be negatively affected. On the other hand, if the employee is not
able to follow procedures in the workplace, the employer is likely to find that unpleasant and
again the employment relationship is affected.
Governments as external factors impact the employment relationship because they are in
a position of changing the legal framework of labor. For instance, the government can affect
minimum wages that are likely demand increased pay for employees, and this affects the labor

WORK RELATIONSHIP

3

relations because the employer and the employee need to readjust their contract. In some cases,
employers may reduce working hours to manage to meet the minimum wage.
Technology as an external factor has affected work relation in the sense that it has made
it possible for employer and employees to make contact even when both are in distant places. For
instance, some companies employ people online and require people to work online.
II.

The employer is not sure whether the individuals who work on a temporary basis
during the summer months are employees or not. Explain the different types of
employment status that exist so that the employer is aware of them all.
The first main type of employment status is the employee, and this is a term used for an

individual who is to work within the terms of contract of employment. Further, this individual is
expected to work personally. The employees are entitled to several rights such as a written
statement of employment, minimum wage as per the state and flexible working hours among
others.
Then another employment status is the worker whom like the employee also works
within a contract of employment. Similarly, this type of employee must also work personally.
Even so, workers in some cases may have limited rights to send a person to work on their behalf
like in the instance of the sub-contractor. Examples of workers are a casual worker, freelance
worker, agency worker and seasonal worker.
There is also the self-employed type of employment status. This is an individual who has
set up their own business and took responsibility for any successes or losses in their businesses.
In many cases, people who are self-employed are given contracts to provide services to a client.
This ...


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