0330 555 1139 hello@crossehr.co.uk
Criminal Record Checks

Criminal Record Checks

If an applicant or employee has a criminal record, that doesn’t mean they aren’t right for the job.

You may be surprised to learn how many people end up with a criminal conviction by the age of 53. So, how does this affect your hiring decisions?

We explore this and more in our presentation below.

Get to understand criminal record checks in our presentation below, including:

-The Rehabilitation of Offenders Act
-Different Types of DBS
-Spent vs Unspent Convictions
-Disclosure
-Filtering
-Risk Assessments

Please play and pause the slideshow by pressing the button in the bottom left of the video.

If you have any questions, please don’t hesitate to get in touch.

 

Preparing to Return to Work: HR in a Post-Lockdown World

Preparing to Return to Work: HR in a Post-Lockdown World

We are living in very strange times and it is not the first time I have said that…

Who would ever have thought 3 months ago that we would all be cooped up in our own homes for days at a time, let out for an hour, having to queue for our shopping, fretting about toilet roll and tinned tomatoes, baking banana bread and relying on a thing called Zoom we had barely even heard of? Some days, I feel like we’re trapped in some weird apocalyptic Netflix drama – but maybe that’s just because I’ve spent a while watching that too – Tiger King and White Lines anyone?

 

Moving Forward – HR in a Post-Lockdown World

However, lockdown didn’t keep us down for long. We adapted surprisingly quickly, kept going and it’s starting to feel like we’re finally coming out on the other side.

That’s the reason for this blog to be honest…

My raison d’etre is to help small businesses navigate the intricacies and plain madness that comes from employing staff, so I decided to make things easier for you all and put together a pack with all the common questions I am being asked by you about the ‘BIG RETURN’ – along with some guidance, information and resources that should help ease your concerns.

The amazing Helen Fleet will also be contributing from a financial standpoint (we are all in this together).

 

So, you want to open up and start the BIG RETURN, what should you do?

Firstly, you need to think about what your organisation needs to look like; i.e. will it be the same or will you need to pivot and change?

  • Do you need to bring people back into the office or keep them working from home for a while or for the foreseeable future?
  • Have you furloughed staff you need to bring back or are you keeping them on furlough or a bit of both?
  • Will some staff be returning at all?

 

Bringing People Back

What should you be considering before you bring people back? Making these considerations is a great place to start…

1. The big first tranche of returnees will occur in July where the furlough rules are changing to allow employees to be furloughed on a part-time basis. If you need to take employees off furlough, it is advisable to write to them to have it confirmed. In our COVID support kit, we’ve crafted a brief returning from furlough letter template to make this an easy task.

2. You need to do a Risk Assessment for each returning employee.  Unfortunately, the only COVID specific risk assessment I could find is from the Northern Ireland HSE but its great and I highly recommend you use this as a basis for your risk assessments. You can view it within the risk assessment pack of our toolkit here.

3. You need to get your offices ready so that the appropriate level of social distancing can occur. It’s also a good idea to deep clean the office if you can and provide plenty of hand sanitiser, soap and notices from the HSE around hygiene and safe practice. Encouraging good hygiene practice will help to keep to kill the virus.

4. You also need to think about your employees’ journeys to work. Does this put them at risk?

5. It may be worth considering staggering and extending hours, and whether working more flexibly could help your business get back quicker. Check out our Flexible Working Policy within our pack for more information on this.

6. Do you even want your employees in the office at all – or would you prefer they worked from home? If so, we’ve also created a Working from Home Policy to help you formalise and control this agreement.

7. You may want to restructure.

8. You may need to consider redundancies.

These are just some of the considerations you may want to make before rushing back to work.

 

When They Return

Mental health, divorce, feelings of anxiety and displacement, pure joy and relief – these are just some of the things you must prepare to face on your return.

But don’t worry, CrosseHR are here to help and we have you covered. Our comprehensive Return to Work Toolkit has been drawn up by experts and our team. It’s designed to help provide you with everything you need to get started, including:

  • Introduction
  • Information on Ending Furlough
  • Return to Work Letter Template
  • Information for Directors
  • Health and Wellbeing Policy
  • Sickness and Isolation Support
  • Health and Safety Guidance
  • Changing Terms and Conditions
  • Childcare and Returning to Work
  • Maternity Issues
  • Conducting Return to Work Interviews
  • Flexible Working Policy
  • Flexible Working Request Form
  • Flexible Working Methods
  • Homeworking Policy
  • Stress Awareness Template
  • Supporting Employees – Debt
  • Energise – Tackle Business Finances with Helen Fleet
  • Supporting Employees – Divorce

So feel free to download it, it’s on us! And, if you want to chat further, we are always delighted to help.

Olga Crosse, on behalf of the team at Crosse HR.

 

 

Giving Evidence at an Employment Tribunal

Giving Evidence at an Employment Tribunal

Employment tribunals have been a popular topic in the industry since the independent body, the Law Commission, recommended that they should be given powers to: 

  • Award up to £100,000 
  • Deal with disputes where employees are still in work 
  • Double the claim period to 6 months in response to the pandemic 

The significance of these changes could be huge after COVID-19 starts to lessen. Disgruntled workers who have worked excessive hours or feel mistreated will have a longer period to raise their case, in addition to an anticipating rise in unfair dismissal claims, discrimination and redundancy disputes. The resulting pay-out of this could terminate your business’ chances of recovery. 

If you can’t settle a case within the workplace and you are forced to escalate, you best be prepared. Giving evidence against a potential colleague or friend can be an unsettling experience. 

To help get you started, we’ve collated some top tips so that you can keep your cool. 

 

Appropriate Etiquette 

 

It goes without saying that it is vital to represent your organisation well in front of the judge – and the first step is knowing the right etiquette.  

We’ve all seen plenty of films that depict tribunal and, for those that have never experienced it first-hand, that may be all they have to go off. But life isn’t an episode of Judge Judy, so how should you act? 

Simply put, you want to come across as professional, competent and likeable. 

  • Dress smartly 
  • Be punctual – arriving at least 30 minutes before you are due 
  • Follow all instructions 
  • Address the judge/panel correctly – as ‘Sir’ or ‘Madam’ 
  • Show respect by standing whenever the judge and panel enter or exit the room 

It is also important to remember that you are being analysed from the get-go, not just when you’re holding the floor. You will need to be conscious of your body language and refrain from showing frustration. 

 

Communicate Effectively

 

Although the system itself is not designed to trip you up, some people end up tripping over their own feet due to nerves – this is perfectly normalHowever, to present yourself as a pro, communicate effectively with our handy tips below. 

 

Give Straight Answers to Straight Questions 

A common mistake we often see is the need to fill silence. 

Although its important to provide sufficient detail in response to a question, the judge will normally indicate whether they have understood or need you to expand further. Therefore, be conscious of not waffling and remember to speak slowly and clearly to illustrate that you are calm and collected. 

 

Be certain 

Don’t give the opposition any leverage with your position – ensure you display confidence in your case. 

By using language, such as “would have,” you indicate uncertainty in your own statement. Instead, use less assuming language that reassures the judge that you remember, such as “I did…” and stick to the facts. 

In the case that you don’t remember, or you’re not sure, it is best to be upfront about your weaknesses rather than covering them up. 

 

Direct Your Answers to the Panel 

When you’re answering a question, regardless of who asks, it is important that you reply to the judge or panel. This can feel quite unnatural at firstRemember, you are trying to help the judge see your way, not the opposition, so direct your answer accordingly. 

TOP TIP: Point your feet in the judge’s direction to remind yourself where to look when you speak!

 

Be Honest 

 

Giving evidence can feel uncomfortable, especially if youre friendly with the person/s in question. However, it is your sworn oath and legal obligation to tell the truth, so do not be swayed by any personal bias you may have. 

When answering a question, take your time to think through your reply. If any evidence you provide is found to be false or inaccurate, no matter how small or unrelated to the case, the opposition will try to use this to define your character and determine how trustworthy you are. 

Again, this is not a memory test. If you don’t remember, be honest and admit it rather than making assumptions or guesses.  

 

Using the Bundle 

 

It is standard procedure that relevant documentation, referred to as the ‘bundle’ will be collected ahead of your tribunal dateAny document that is likely to be referred to should be placed into a bundle for use by the judge, witnesses and other relevant parties. It may include items, such as: 

  • Witness statements 
  • Evidence of loss of earnings 
  • Evidence of misconduct 
  • Contract details 
  • Previous communications and efforts to resolve the issue 

You will have access to a co

py of the bundle in advance, so be sure to take the time to familiarise yourself with this and mark relevant pages if necessary. It is also recommended to re-read your witness statement the night before, to ensure you have a clear recollection of events. 

During the hearing, if it would be helpful to refer to the document, ask to do so and take a moment to remind yourself before speaking. 

 

Be Resilient 

 

As a respectable professional, you’ll have likely been exposed to some office conflict or butting heads. However, this may seem like horseplay after being exposed to a distressed and angry opposition at a tribunal, so it is important to be resilient. 

Providing evidence at an employment tribunal can be an uncomfortable experience but remember not to take it personally – it is the opposition’s job to question your character and discredit you and the judge’s role to determine a just ruling. 

 

Keep Cool 

It’s not nice having someone doubt your honesty, competency and professionalism. However, it is important not to become frustrated, offended or visibly upset. The opposition will look for weakness and exploit this. 

Instead, focus on remaining clear and open to questioning. 

 

Prepare for their attack 

Below are a few common techniques that may be used to discredit or unnerve you by the opposition. 

  • Pressuring you into inaccurate statements – often, the opposition may try and pressure you into a black or white situation when it may be a shade of grey. Ensure you look out for this and stick to your grounds.
     
  • They ask is it possible that…” to try and lead you into an admission or inaccurate statement. It is important that you answer this factually but be careful of your language. 
  • They may use cross-examinations to check your facts and statement. 
  • They may interrupt you to disrupt your thoughts or try and elicit a reaction. 

Your focus should remain on telling the truth and remaining calm. Try your best not to become frustrated, offended or upset. Although it can be upsetting having to escalate an issue, if you’re telling the truth, there is nothing to hide. 

 

How do I become Resilient? 

According to MIND, “Resilience is not just your ability to bounce back, but also your capacity to adapt in the face of challenging circumstances, whilst maintaining a stable mental wellbeing. 

The good news is, resilience is not a personality trait – it is something we must all takes steps to achieve. We can do this by making some adjustments:

  • Make some lifestyle changes 
  • Look after your physical health 
  • Give yourself a break 
  • Build your support network 

The charity MIND has some useful resources to help you get started here.

 

Need more advice?

 

If you’re preparing for an employment tribunal and you’re in need of some expert advice, please get in contact here. 

Citizen’s advice also offers some helpful, free guidance that you may find useful on their website here. 

 

It’s All Change

It’s All Change

It can be hard to keep on top of the latest advice and regulations at the best of times when you’re spread thin and busy with deadlines – let alone in the middle of a global pandemic. 

Understandably, many of our clients feel overwhelmed by all the information out there. Especially with so many opinion pieces and inaccurate assumptions, it can be hard to know what to trust. 

To help you cut through all of this noise, we’ve collated some useful resources to help address your most pressing concerns. 

This article outlines some of the key changes that you should be aware of and points you in the right direction for more information and support should you need it. 

We hope it helps in this stressful time. 

 

Coronavirus Job Retention Scheme 

It is well reported that HMRC will reimburse 80% of furloughed workers’ wage costs up to a cap of £2,500pm. This is part of their plan to support businesses during the coronavirus outbreak. 

Who counts as a furloughed worker? 

A furloughed worker is someone who is still employed but not working, perhaps due to a lack of work. The purpose of this scheme is to help businesses to continue paying employees that would have otherwise been laid off by putting them on temporary leave. 

Furloughed employees must have been on your PAYE payroll on 28 February 2020, and can be on any type of contract, including: 

  • Full-time employees 
  • Part-time employees 
  • Employees on agency contracts 
  • Employees on flexible or zero-hour contracts 

 If you have made employees redundant since 28 February 2020, you can rehire and cover these employees under the scheme too. 

What will it cost the employer? 

The Coronavirus Job Retention Scheme is open to all UK employers for at least three months starting from 1 March 2020. In addition to the 80% grant covered by the government, businesses must also pay:  

  • Employer National Insurance contribution 
  • Minimum enrolment employer pension contribution 

Where a company is being taken under the management of an administrator, the administrator will be able to access the Job Retention Scheme. 

Useful Resources 

A breakdown of the government support available for businesses 

How to access the scheme 

 

Claiming Statutory Sick Pay (SSP) 

If you’re self-isolating because of COVID-19, you are entitled to receive Statutory Sick Pay (SSP) of £94.25 per week. 

When can I claim SSP? 

New legislation has been brought forward to give you access to SSP from the first day you’re self-isolating and cannot work. This new legislation came into action on 13.03.20 and overrides the previous 4-day caveat. 

Useful Resources 

How to report and manage sickness in 10 easy steps 

When should I self-isolate? 

How to claim SSP 

 

Changes to IR35 

In light of the coronavirus creating business uncertainty and high levels of stress, the Treasury confirmed that they would postpone IR35 for another year. 

This means that businesses now have until April 2021 to address the reforms necessary. These changes will drive major change in the contracting industry. 

What is IR35? 

IR35 is designed to combat tax avoidance by “disguised employees”. Under new rules, every medium and large private sector business in the UK will become liable for setting the tax status of any employee that they hire – including contract and temporary workers. 

The new rules will apply to businesses with either: 

  • 50+ employees 
  • An annual turnover of over £10.2 million 

With many companies already reviewing their policies and contracts in response to the COVID-19 outbreak, now is a great time to address IR35 so that you’re prepared when the changes come in next April. 

Useful Resources 

What are the changes that IR35 will make? 

Understanding off-payroll working (IR35) 

 

The Good Work Plan 

As of April 2020, The Good Work Plan comes into place. This is a plan that sets out the government’s vision for the future of the UK labour market. It seeks to “reward people for hard work” in a bid to boost productivity and earnings in the UK. 

The new plan details how to address issues in our labour market, such as: 

  • The implications of new forms of work 
  • The rise of digital platforms
  • Impacts of new working models 


The Good Work Plan also draws on recommendations about:

  • Employment status 
  • Agency workers 
  • Increasing transparency in the labour market 
  • The enforcement of employment rights 

Useful Resources 

What changes you should expect to see from The Good Work Plan 

Policy Paper – Good Work Plan 

 

Deferring VAT and Income Tax Payments 

The government have announced that they will support businesses by deferring tax payments, as outlined below. 

Deferred Deadlines: 

  • If you’re self-employed, Income Tax payments due in July 2020 under the Self-Assessment system will be deferred to January 2021. 
  • For VAT, the deferral will apply from 20 March 2020 until 30 June 2020. 

All UK businesses and self-employed individuals are eligible. There is no application required. 

Useful Resources 

Relieve temporary financial distress with HMRC Time to Pay Offer 

A breakdown of the government support available for businesses 

 

Supporting your employees’ financial wellbeing 

Typically, your employee’s largest financial outgoing will be their monthly mortgage payment.  

Taking a break from their mortgage – with a mortgage holiday of up to three months – can act as welcome financial relief. In this unsettling time, if you are having to cut or reduce hours, it may be worth providing some resources for your employees to access this aid. 

Am I Eligible? 

Whether you are eligible to take a payment holiday, for how long, and the conditions you must meet dependon: 

  • Your lender 
  • Your mortgage contract 
  • Your financial circumstance 

It is best to advice that your employee contacts their bank directly to discuss a mortgage payment holiday. However, please do make them aware that this will make their payments go up afterwards. 

What About Those Who Rent? 

The government has announced a package of measures to protect renters that may be affected by Coronavirus and a subsequent loss of earnings. The emergency legislation means: 

  • You cannot be evicted from social or private rented accommodation while this national emergency is taking place 
  • Landlords can take out a mortgage holiday on their Buy to Let mortgage 

Useful Resources 

Pros and Cons of a Mortgage Holiday 

Mortgages and Coronavirus: Information for Consumers by FCA 

Government Press Release – Protection for Renters 

 

General Advice: 

 

Government Advice 

If you are still unsure about how you should be responding to the COVID-19 outbreak, please refer to GOV.UK platform here. It is frequently updated with the latest information and advice. 

For further guidance for employees, employers and businesses, please visit the government website here. 

 

Mental Health 

It is well recognised that isolation and the stress of the outbreak may be triggering for many, leading to a decline in mental health. 

In order to help you address this, we’ve attached some useful resources that help you become aware of your own mental state and some handy tips that may help you look after yourself during this difficult time. 

Discover how you should be looking after your mental health during the Coronavirus outbreak here. 

The mental health charity, MIND, have also released some support and resources to help you during this time. You can access this here. 

 

Working from Home 

If you’ve recently transitioned from office to homethe resources below may help you settle into your new work environment more seamlessly! 

Tips for creating a positive environment to work from are available here.  

Top tips for working from home are also available here. 

We also appreciate that it is especially hard for those who are working from home whilst simultaneously juggling homeschooling. If you’re looking for some advice about working from home with children, you can find some tips here.

 

What Next? 

If you have any concerns or questions about the latest changes in legislation or how they may affect you, please do not hesitate to contact us online or email hello@crossehr.co.uk and we will try our best to point you in the right direction. 

 

 

HR Survival Through COVID-19

HR Survival Through COVID-19

Thrive and Survive is a community created by a collective of business people who are coming together to help you overcome the current financial crisis and come out of this with a stronger business.

I recently shared my thoughts on the HR implications of COVID-19 in a webinar that covered:

  • How to deal with 3 scenarios of people ‘out of the business’ with COVID-19 related reasons
  • Furloughing workers – who’re eligible, what are the rules and how to do it
  • Common questions on partial furloughing
  • Advice on keeping in touch with staff, engagement, and productivity
  • Lots of chat on the positives arising for business and the opportunity when this is all over

Please excuse the noise in the background – we can thank the joys of remote working in a busy city for that!

Hopefully, it’s not too distracting and you find it useful.

[PLEASE SCROLL DOWN FOR LATEST UPDATE]

Since recording this webinar, a lot has changed. It seems that every day new data comes to light, so we just wanted to drop in a little more information to support you with the HR implications of COVID-19.

Since the government briefing on 10.05.20, lockdown restrictions are beginning to lift for certain businesses – but this doesn’t mean you should be too hasty in heading back to work. Let’s take a little look at why…

Health and Safety:

It is important at this point to remind you that it is your moral responsibility to protect the health and safety of your colleagues. Before rushing back to work, ensure you address some primary concerns, including:

  • Social Distancing
  • Commuting
  • Staggering Shifts
  • Personal Protective Equipment (PPE)
  • Cleaning, including providing ample hand-washing facilities
  • Mental Health

Before inviting your employees back into the workplace, ensure you follow the guidance of the Health and Safety Executive (HSE). As well as directing you towards some useful resources, including industry-specific support for certain work settings, they are regularly updating their website with guidance to help your safe transition back to work.

Talking to Your Employees:

In this stressful time, we must not neglect our duty to check in on our employees.

This high-stress environment is unsettling for everyone, especially those with vulnerable or shielded loved ones. Ensure you communicate with empathy as you seek to return to normal and make reasonable adjustments where possible.

Return to Work Interviews

If you have had members of staff on furlough for a number of months, it may also be worth considering whether a return to work interview would be of use. This short, informal meeting may help you address your workforce’s concerns and facilitate a successful transition back to the office. If you need a little guidance, why not lean on our slick and consistent process here?

Involving Employees in the Process:

By consulting and involving your employees in the steps you are taking to manage the risk of coronavirus in your workplace you can:

  • Explain the changes
  • Illustrate the safety practices in place
  • Make sure changes will work – their operational input may be vital
  • Hear their ideas and address their concerns
  • Continue to operate your business safely during the outbreak

It is also recommended that you share the results of your risk assessment with your workforce. Where possible, publish the results on your website (note: the government expects all employers with over 50 workers to do so).

If you are unsure where to start with this, HSENI has released an example COVID-19 risk assessment to help you on your way. You can download via their website.

Need some advice?

If you have any questions about the HR implications of COVID-19 or you’d like to discuss how to run return to work interviews, please do get in contact. We hope this has been of use during this stressful time.

The Employee Reference Question

The Employee Reference Question

One of the most common questions I get asked is ‘What shall I put in an employee reference’?

It’s all well and good if everyone got on, there were no problems and the employee in question left on good terms, that does not tend to pose any questions.

It’s the iffy, ‘I was well rid but really don’t want to say so’ references that cause the dilemmas.

In short, you can give a factually based reference for everyone, the good, the bad and the indifferent.

These are the key details to confirm:

  • Job title
  • Start and end date of employment
  • Short disclaimer at the bottom

That way you cannot be accused of discrimination in any form as you are treating everyone the same. Steer clear from personal opinions because they are exactly that – personal and can cause all sorts of issues.

Keep it short and to the point. For guidance simply download our How-To Guide, which contains a sample reference policy and wording here or call us on 0330 555 1139.

 

Coronavirus: what do you need to know?

Coronavirus: what do you need to know?

A number of employers have asked us for workplace guidance in light of the coronavirus outbreak. Whilst we are not, of course, medically qualified to give advice on how best to deal with the virus, our friends at Keelys Solicitors have put together the following note which to a large extent reflects ACAS guidance.

 

Get the latest updates

All employers should regularly check the government website for up to date information about the spread of the virus and the risk to the public. This is likely to keep changing and you will need to keep your approach to the virus under review as the situation and Government advice develops. The Department of Health and Social Care will be publishing updated data on this page every day at 2pm until further notice.

 

Should employees be paid for time off?

If an employee actually experiences symptoms of coronavirus, they should go off sick immediately and be paid sick pay as usual.

Employees should follow normal absence reporting procedures if they’re not able to attend work. However, the employer might need to make allowances if, for example, employees are not actually sick but are quarantined, advised to self-isolate or are unable to leave an affected area. An employee might not be able to get a sick note in those circumstances.

 

Employees may not be showing any symptoms but may:

a) have been advised by a Doctor to self-isolate;
b) have been placed in quarantine as a precautionary measure; or
c) be abroad in an affected area and not allowed to travel back to the UK.

In those cases the employee is not actually sick. There is therefore no statutory right to pay if they cannot work for these reasons. However, firstly, it would be harsh not to pay staff in those circumstances where they are only following advice or are physically incapable of attending work. Secondly, saying that you will not pay them may cause staff to come to work instead of self-isolating and risk further spread of the virus.

We suggest that employees absent for these reasons are either treated as off sick or, by agreement with the employee, granted annual leave.

 

What happens if an employee returns from an affected zone and appears to have symptoms?

If an employee becomes unwell in the workplace and has recently come back from an area affected by coronavirus, ACAS guidance is as follows:

  • Get at least 2 metres (7 feet) away from other people
  • Go to a room or area behind a closed door, such as a sickbay or staff office
  • Avoid touching anything
  • Cough or sneeze into a tissue and put it into a bin immediately. If they do not have tissues, ensure that they cough and sneeze into the crook of their elbow
  • Use a separate bathroom from others, if possible

The unwell person should use their own mobile phone to call either, for NHS advice: 111; for an ambulance, if they’re seriously ill or injured or their life is at risk: 999. They should tell the operator their symptoms and which country they’ve returned from in the last 14 days.

 

How should the employer respond if someone with coronavirus comes into work?

If someone with coronavirus comes to work, the workplace does not necessarily have to close. The local Public Health England (PHE) health protection team will get in contact with the employer to:

  • Discuss the case
  • Identify people who have been in contact with the affected person
  • Carry out a risk assessment
  • Advise on any actions or precautions to take

 

What rights do employers have regarding absence?

If an employee chooses not to attend work due to an outbreak, the starting point is that it is down to the employer’s discretion whether to pay them (for what could be quite a long period). We suggest you listen to your employee’s concerns and, if these are well- founded then, where practicable, you should consider granting home working, annual leave or unpaid leave. If an employee unreasonably refuses to attend work, they could be disciplined for that. Please seek advice before taking any disciplinary action, however.

If the employer has instructed an employee not to attend work, you could lay them off temporarily if you have a right in the contract to do so. They would then be entitled to statutory guarantee pay of £29 per day for the first 5 days. If you do not have the right to lay them off, you would need to continue paying them during this absence.

Employees are entitled to a reasonable amount of unpaid time off to provide assistance to a dependant in an unexpected event or emergency. This could well apply to situations to do with coronavirus. For example, schools may close and alternative arrangements for childcare may need to be made.

 

What can employers do to prevent the virus spreading?

Employers should consider the following steps to help prevent the spread of the virus:

  • Make sure there are clean places for staff to wash hands with hot water and soap and encourage everyone to wash their hands regularly
  • Give out hand sanitisers and tissues to staff, and encourage them to use them
  • Consider if any business travel planned to affected areas can be avoided

 

If you are looking for further advice regarding the ongoing issues surrounding coronavirus and its impact on the workplace, please do not hesitate to get in contact.

What are the changes that IR35 will make?

What are the changes that IR35 will make?

We are very honoured to have Emma Spandrzyk of Keelys Solicitors share this guest blog with us. Her piece addresses some of the key insights many of you will have been thinking about when it comes to IR35.

I have recently joined Keelys in the employment department.  I have been working as an employment solicitor for 9 years and, most recently, I have worked in-house for the police.

Some of our clients have been asking us about changes to the law on IR35 next year so we’ve taken some time to explain some of what is happening.

What is the current position?

If someone works on a self-employed basis but, in reality, they are an employee, HMRC can recover the underpaid tax and national insurance from the organisation that they work for.

Sometimes, the individual will set up their own personal service company to provide their services.  If HMRC decides that the arrangement is a sham and that, if the individual was engaged directly by the client, they would be an employee, HMRC can recover the underpaid tax and national insurance under IR35.  Currently, that is recoverable from the individual and/or their company rather than from the end-user.  The exception to that is in the public sector, where the end-user will be liable for the tax and national insurance.

What is changing?

From April 2020 businesses with more than 50 employees or a turnover of more than £10.2m will be affected by the new rules.  They will, therefore, be liable for tax and national insurance if they are found to be engaging people through personal service companies who, in reality, ‘are’ employees.  If your business is smaller than that, you do not need to worry although we would not be surprised if, in future, these rules apply to smaller companies as well.

How to tell if someone falls within IR35?

If you are a larger business who will be covered by the new rules, the first step is to identify the contractors that provide their services through personal service companies.

To assess whether contractors fall within IR35, businesses will need to look at a range of criteria including the following:

  • Control – how much autonomy does the contractor have in terms of how they deliver their work? If the business retains full control over how, when and where tasks are completed, this is indicative of employee status and the contractor is likely to be caught by IR35. If the contractor has full autonomy over the completion of tasks, they are more likely to fall outside the scope of IR35.
  • Personal Service – does the contractor have to undertake the work themselves? The ability to send a substitute helps point towards a contractor being genuinely self-employed and outside the IR35 rules.
  • Mutual Obligation – is there a requirement for both parties to continue to offer and accept work? If the business has an obligation to provide work and there is an expectation that the contractor accepts it, then this will indicate that the contractor is caught by IR35.

As part of the assessment, businesses should also consider factors such as the degree of integration that the contractor has with the business, the level of financial risk they assume and who provides the contractor’s work equipment.

What does this mean for your business?

Businesses will need to show HMRC that they have taken reasonable care in undertaking their contractor assessments. When reviewing assessments, HMRC will look at the size of the business. The bigger the business and the greater the resources available to it, the more effort HMRC will expect in relation to the process.

There is a useful tool on the HMRC website that you can use to assess whether someone is genuinely self-employed or should be treated as an employee: https://www.gov.uk/guidance/check-employment-status-for-tax

Written statements of particulars

Employers will be used to providing employees with a written statement of terms within two months of starting work. However, from the 6 April onwards, this will become a day one right.

This right will also extend to all categories of “workers” and will not be limited to individuals engaged under a contract of employment.  It will, therefore, apply to zero-hours workers.

You may also have heard that some additional information should be included in the statement.  However, we do not suggest that you make any changes to your contracts because the additional items are very minor. The key thing to ensure is that any new hires post 6 April are given a written statement on day one.

There is no obligation to issue your existing staff with a new statement. You only need to take this step if an individual specifically requests new particulars.

Holiday Pay

The reference period for determining an average week’s pay for the purposes of calculating holiday pay is increasing from 12 to 52 weeks. This is intended to limit the impact of seasonal fluctuations in work on holiday pay.

If you are currently using the 12-week model, you will need to amend any calculations to cover 52 weeks from 6 April 2020.

Agency Workers

Under the “Swedish Derogation”, temporary work agencies can avoid the obligation to pay agency workers the same as the client’s direct employees after a 12 week qualifying period if certain conditions are satisfied.

From 6 April 2020, this derogation will be abolished. This means that all agency workers will have the right to pay parity with permanent employees after 12 weeks.

Tax on Termination Payments

At current, termination payments up to £30,000 can be paid free of income tax or employer’s National Insurance Contributions. Any amount over the £30,000 limit is subject to income tax deductions only.

From 6 April 2020, all termination payments above £30,000 will be subject to both income tax and employer National Insurance Contributions. This is in addition to the changes last year whereby all payments in lieu of notice are subject to tax and National Insurance.

Parental Bereavement Leave

Another right coming in to force on 6 April is the right to Parental Bereavement Leave known as “Jack’s Law”. Working parents who lose a child under the age of 18 will get two weeks’ statutory leave. We suggest you update your Dependent Care Leave Policy with the following wording to reflect this.

“Parental Bereavement Leave:

Staff who lose a child under the age of 18 are entitled to two weeks’ parental bereavement leave which can be taken in a single block of two weeks or as two separate blocks of a week each. The leave can be taken at any time in the period of 12 months after the child’s death. Staff with 26 weeks’ continuous service and weekly average earnings over the lower earnings limit will receive Statutory Parental Bereavement Pay during any period of Parental Bereavement Leave.”

Current Rates and Limits

April 2020 will also see the usual annual increase to the following rates and limits:

  • The National Living Wage (for workers ages 25 or over) from £8.21 to £8.72 per hour.
  • The National Minimum Wage rates:

Workers aged 21-24 – from £7.70 to £8.20 per hour

Workers aged 18-20 – from £6.15 to £6.45 per hour

Workers aged 16-17 – from £4.35 to £4.55 per hour

Apprentice rate – from £3.90 to £4.15 per hour

  • Statutory Maternity Pay and Statutory Paternity Pay will increase from £148.68 to £151.20.
  • Statutory Sick Pay will increase from £94.25 to £95.85.

Please let me know if you would like further advice on this.  You may also want to speak to your accountant for advice on whether you are taxing staff appropriately.