1 October 2013 employment law changes: third party harassment, curbs on directors` pay and national minimum wage.
27 September 2013
A few employment law changes come into force on 1 October 2013:
- Abolition of third-party harassment provisions. The Enterprise and Regulatory Reform Act 2013 (ERRA 2013) will repeal the third party harassment provisions in the Equality Act 2010 (EqA 2010). A classic example of third party harassment was the so-called “Bernard Manning case”, Burton and another v De Vere Hotels (1997) concerning the harassment of two black waitresses who were working at a banquet at one of the respondent`s hotels. They were made the subject of racist and sexist remarks by the after-dinner speaker, the comedian Bernard Manning. The EAT held the hotel liable for direct race discrimination. There was no liability for harassment, as there was no statutory definition of harassment at that time.
The government believe that the current provisions governing third-party harassment are an example of unnecessary regulation introduced without any real or perceived need, and that there are alternative legal routes that employees can pursue if they consider that they have been subject to repeated harassment by a third-party. These suggested routes include bringing a claim under the “normal” harassment provisions of the EqA 2010, a claim for constructive dismissal, a claim for negligence and a claim under the Protection from Harassment Act 1997.
- Supporters of repeal focused on the fact that it would remove the arbitrary "three strikes" test for employer liability under the present third party harassment provisions.
- Directors` remuneration. ERRA 2013 also introduces a new voting and disclosure regime for the remuneration of directors of quoted companies.
- For financial years ending on or after 30 September 2013, the annual directors` remuneration report for quoted companies will need to contain a statement by the chair of the remuneration committee, the company`s policy on directors` remuneration and information on how the remuneration policy was implemented in the previous financial year.
Shareholders will have a binding vote on the remuneration policy, which must be approved by ordinary resolution at least every three years. If shareholders do not approve the advisory vote in a year in which the remuneration policy was not put to a shareholder resolution, this will trigger the need for the company to put the remuneration policy to shareholders the following year.
- Under the new regime, whenever a director leaves office, the company must publish a statement on its website setting out what payments the director has received or may receive in future.
- National minimum wage. The national minimum wage (NMW) rates will increase for workers aged 21 and over and apprentices. The NMW will also now apply to agricultural workers. For the rate click here.
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