Human Resource Management: A Case Study Approach

Labour Law

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• Legal policy on employment and employment services

• Discrimination

• The legal status of workers in the labour market

Lecture outline

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• To understand the different elements that make up the national policy on employment regulation

• To understand the role of the public and private sector in the labour market

• To understand employment law as it relates to equalising employment opportunities

Learning objectives

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• The UK Government has a national plan for employment influenced and partly organised by the EU

• The ‘Lisbon strategy’ established a 10-year plan to make Europe ‘the most dynamic and competitive knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion and respect for the environment’

The policy context

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• The UK Government has set a number of objectives which include developing:

– active labour market policies, including help for those without work

– policies that make work pay – eg incentives to work paid through the tax and benefits system

– policies that reduce barriers to work – eg those concerned with education, skills development and training

The policy context cont’d

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• Since the 1980s the Government has given many functions relating to labour market regulation to executive agencies

• Executive agencies were created to enable executive functions within government to be carried out by a well-defined business unit to deliver specified outputs

• The UK private sector also has a history of playing an important role in the employment field throughout the twentieth century

The roles of the public and private sector

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• 500,000 workers a week use the services of private sector employment agencies

• The industry is regulated by the Employment Agencies Act 1973 as modified by further Regulations in 2003/2004 which distinguish between employment agencies and employment businesses

• Employment businesses supply temporary staff• Employment agencies supply workers to fill

permanent vacancies

The roles of the public and private sector cont’d

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• An employment agency or business cannot charge job-seekers a fee

• An employment business cannot require a job-seeker to perform the tasks of a worker taking part in an (official) industrial dispute

• An employment business may not withhold pay merely because a signed timesheet has not been provided

• An agency or business must from the first provide job-seekers with details of the terms and conditions under which it operates

Private employment services

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• Employment businesses must agree whether the work-seeker is (or will be) employed under a contract of service or a contract for services

• Employment agencies must not introduce a person under 18 to a potential employer unless he or she has received vocational guidance

• There are strict rules on documentation and record-keeping

• Failure to meet the legal requirements may result in fines of up to £5,000; defaulting individuals or organisations may be prohibited from being involved in employment work for up to 10 years

Private employment services cont’d

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• JobCentre Plus is an executive agency for the Department for Work and Pensions (DWP)

• Its aims are to:– increase effective labour supply by helping unemployed and

economically inactive people back into work– provide employers with high-quaility demand-led services – help people in the most disadvantaged groups to move closer to

the employment market– work towards parity of outcomes for ethnic minority customers– ensure that people receiving benefits fulfil their responsibilities

and are offered high-quality help and support– pay people the correct amount of benefit to which they are

entitled

Public employment services

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• 44% of women work part-time; their average weekly earnings are 40% lower than those of men working full-time

• Women hold the majority of positions in administrative, secretarial and personal service jobs

• The Government has introduced various work–life balance initiatives, including improved childcare help, financial incentives and flexible working

Disadvantaged people in the labour market – women

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• The Flexible Working Regulations 2002 set out the rules for encouraging individuals to apply to their employer for more flexible working arrangements and to have that request treated seriously – they can be turned down only if there is a clear business reason to do so

• The treatment of part-time workers is a discrimination issue because the majority of part-time workers are female

Disadvantaged people in the labour market – women cont’d

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• The Equal Pay Act 1970 came into effect in 1975: it implies an equality clause into all contracts of employment and is applicable to all the terms of a contract under which a woman is employed (not just pay)

Disadvantaged people in the labour market – women cont’d

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• The legislation against race and sex discrimination mainly comprises:– the Sex Discrimination Act 1975, which covers

gender, gender re-assignment, being married– the Race Relations Act 1976, as amended by the

Race Relations (Amendment) Act 2000, which covers discrimination on racial grounds (defined as colour, race, nationality, ethnic or national origins) and provides protection against direct and indirect discrimination, and victimisation and harassment

Disadvantaged people in the labour market – ethnic minorities and racial discrimination

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• The exceptions to the legislation are where being of a particular sex or racial/ethnic group is a ‘genuine occupational qualification’ (GOQ) in which certain specific criteria apply

• These criteria include:– matters of decency/propriety– where a degree of physical/social contact is required in a

position that requires constant personal attention– where the job-holder must reside on the employer‘s

premises and there is no provision for segregation– for authenticity in entertainment– for authenticity in the preparation and serving of food – where a welfare service is most effectively carried out only

by a person of a particular race or sex

Disadvantaged people in the labour market – ethnic minorities/racial discrimination cont’d

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• The Employment Equality (Religion or Belief) Regulations 2003 and the Employment Equality (Sexual Orientation) Regulations 2003 were introduced to comply with the Framework Directive on Equal Treatment at Work (Directive 2000/78/EC)

• The legal definition of ‘religion or belief’ has been left deliberately vague (and unhelpful):– any religion, religious belief, or similar

philosophical belief• ‘Sexual orientation’ is defined as a sexual orientation

towards persons of the same sex, of the opposite sex, or of the same and opposite sex

• There may be an exception in the case of jobs in which a particular religion, belief of sexual orientation is a genuine occupational requirement

Disadvantaged people in the labour market – discrimination on the grounds of religion, belief or sexual orientation

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• The Disability Discrimination Act (DDA) 1995 incudes an obligation upon an employer to make adjustments to the working environment and schedule

• Direct discrimination results from treatment on the grounds of disability that is less favourable than is (or would have been) given to a non-disabled person

• Treatment that is (or amounts to) direct discrimination has no justification defence for an employer

• There are strict limitations on where an employer can claim justification in the case of indirect discrimination

Disadvantaged people in the labour market – people with disabilities

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• An employer can be guilty of victimisation who treats an employee differently because the employee has taken action under the DDA

• An employer has a duty to make reasonable adjustments (although the employer has to know that the employee has a disability)

• It is unlawful for an employer to harass a disabled employee or job applicant

• Harassment is where the unwanted conduct has the purpose or effect of violating the disabled person‘s dignity or of creating a hostile, degrading, humiliating or offensive environment for him or her

Disadvantaged people in the labour market – people with disabilities cont’d

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• The Employment Equality (Age) Regulations 2006 provide protection against direct and indirect discrimination, harassment and victimisation

• It is, however, permissible to directly discriminate where discrimination is ‘a proportionate means of achieving a legitimate aim’

• Retirement below the age of 65 has to be objectively justified (although this is to be reviewed in 2011)

Disadvantaged people in the labour market – older workers

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• An ‘employee’ is defined as:– an individual who has entered into or works under a

contract of employment• A ‘worker’ has a broader definition:

– an individual who has entered into, or works under, a contract of employment or any other contract whereby the individual undertakes to 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

• The EAT judgement in Byrne Brothers v Baird [2002] IRLR 96 held that Parliament had aimed to create an intermediate class of protected worker (eg self-employed subcontracted construction workers who work for long periods for a single employer as part of an integrated workforce)

• An individual who is classed as self-employed may still be reliant on a single employer for his/her supply of work and income but without certain employment protection rights

The legal status of the worker in the labour market

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• Whether an individual is employed or self-employed can legally affect:– employment protection measures– taxation– the liability of an employer – the standard of care an employer owes

The legal status of the worker in the labour market

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• Employee relations in both the public and private sector are regulated

• Most regulation is of the private sector and is intended to protect employees

• Since the 1970s there has been increasing protection for types of employee who in the past have been disadvantaged

• Women and ethnic minorities have been protected since the 1970s, disabled people have been protected since 1995, and age discrimination was outlawed in 2006

Lecture summary

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• Anti-discrimination laws are frequently updated to take account of new situations

• All HR activities are affected by anti-discrimination practices, including recruitment, selection, promotion and access to training

• Employees are protected from exploitation by numerous legal measures including the Working Time Directives and the Employment Act 2002 and its updates

• There have been a number of measures introduced to reduce illegal working such as the Asylum and Immigration Acts and the updates controlling workers from the new EU states

• HR professionals must understand the importance of the type of employment status enjoyed by individual workers in order to respond appropriately

Lecture summary

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Questions to answer:1. In deciding whether there are racial grounds for less

favourable treatment, is an employment tribunal entitled to look at evidence about the conduct of the alleged discriminator both before and after the act about which a complaint has been made?

2. Where there are allegations of direct or indirect discrimination by an employer over a substantial period of time, should the tribunal look at the individual incidents in isolation from one another?

3. If an employer has an arrangement which is racially discriminatory, does it make any difference that the manager in charge changes?

Case study:

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Questions to answer:4. How relevant is it that there was ‘a force’ in existence

throughout that prevented Mr Foxall and others from picturing a turban-wearing Sikh with a pronounced accent in the managerial roles, which a person of the applicant’s qualifications and experience could easily have achieved?

5. Where a selection process focuses on experience, should any handicap which the employer has inflicted on a candidate by earlier discriminatory behaviour be taken into account?

6. Is a tribunal entitled to take into consideration the fact that a ‘glass ceiling’ operated in a particular department, which made it very difficult for those who were not white to obtain senior management positions?

Case study:

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Questions to answer:7. Where direct or indirect discrimination is alleged, how

relevant is the manner in which the complainant’s grievance is dealt with?

8. If Mr Rihal had chosen to resign as a result of his treatment by the employer, could he have complained of unfair constructive dismissal?

Case study:

Question session

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