Top Employment Law Myths
Posted: Thursday 24 November 2011
Article by Innes Clark, Employment Law Partner.
There is no contract of employment if there’s nothing in writing.
False: Even a verbal contract is a binding agreement and a contract of employment will be implied from the dealings between employer and employee. Employers are required by law though to issue a written contract of employment within 2 months of an employee commencing employment with them.
Employees with less than one year’s service cannot raise an unfair dismissal claim.
False: There are a good number of situations (for example dismissal for certain health and safety related reasons, dismissal for whistleblowing, dismissal for exercising certain statutory rights) where an unfair dismissal complaint can come from an employee with under one year’s service. In addition, no qualifying service is required to raise discrimination claims. Also, bear in mind that the one year's service is misleading and it is actually at the 51 week point that, in most cases, an employee will qualify for the right not to be unfairly dismissed. This is because of the operation of the statutory one week notice period which will take the employee over the 1 year threshold.
You can sack someone on the spot for gross misconduct without following any form of procedure.
False: I think most employers now know that you can't do this but I do still see it happening from time to time. Where an employee has over one year’s service this will result in the dismissal being unfair. Employers should always follow a fair procedure which is compliant with the ACAS Code and even if an employee is caught red handed they should be suspended and a fair procedure followed.
If an employee’s fixed term contract expires then they cannot raise a claim for unfair dismissal.
False: The expiry of a fixed term contract is actually a dismissal, and is subject to the same test as any other dismissal. An employer should follow a fair procedure before allowing a fixed term contract to expire. This would involve considering the employee for any other suitable vacancies within the organisation. Any failure to follow these steps may result in an unfair dismissal claim. In the event that there was no good reason for the fixed term contract in the first place and the role (or a similar one) still exists then it is also likely that any dismissal will be unfair.
An employee returning from maternity leave has an automatic right to work part-time.
False: Such an employee has the right to request to work flexibly but an employer is only under a duty to consider this. However, employers should be careful as a sex discrimination claim can be raised by the employee if the reason given for refusing is not legally justifiable.
Restrictive covenants aren’t worth the paper they’re written on.
False: Provided restrictive covenants are drafted in such a way that they go no further than is necessary to protect a company’s legitimate business interests then they are likely to be enforceable.
You can’t dismiss employees when they are signed off sick.
Depending on the circumstances it may be possible to dismiss employees either because they are off on long term sick leave or because they are repeatedly taking intermittent days off sick. This is the case even if the sickness is genuine or certified by a doctor. However, it is essential that a fair procedure, including appropriate consultation and, certainly in the case of long term absence, the obtaining of medical reports, is followed in each case and full consideration must be given to the employer's obligations in terms of the Equality Act if the employee has or may have a disability.
Employees have the right to be accompanied by someone of their choosing at a disciplinary meeting.
False: Employees only have the right to be accompanied by a fellow employee or a Trade Union Representative at a disciplinary meeting unless their contract of employment or the company policy allows for a broader right of accompaniment. There have been one or two cases recently where public sector employees have successfully argued that they have the right to be accompanied by a legal representative. However, the circumstances where an employee would have such a right is extremely limited and broadly, it would have to involve a situation whereby, if they were dismissed, they would be prevented from working in the same profession again.
The first £30,000 of a severance payment can always be made tax free.
False: Unfortunately it is not as simple as that. There is a statutory exemption which allows the first £30,000 of a genuine ex-gratia payment made on termination of employment to be paid tax free. However, there are many circumstances where payments made on termination are properly taxable. Pay in lieu of notice payments in particular can cause confusion and will very often be properly taxable. Payments close to retirement may also be taxable in certain circumstances.
So there you have it. There are a few more that are springing to mind as I write this so I may well do a Part 2 at a later date.
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