Managing employees and volunteers

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1 Managing employees and volunteers This information sheet provides guidance and advice for village halls and similar community buildings on how to manage their employers and volunteers Last updated November 2013

2 Contents Contents... Page 2 Introduction... Page 3 1 Who is an employee?... Page 3 2 The legal responsibilities of village hall management committees...page Insurance...Page Pensions...Page Health and Safety...Page 10 3 Contract of Employment and Job Description... Page 12 4 Employee s Statutory Rights... Page 15 5 Anti-discrimination legislation... Page 19 6 Family friendly rights... Page 22 7 Dismissal... Page 29 8 Discipline and grievance procedures...page 30 9 Resident staff...page 34 Sources of further information and advice... Page 36 Appendix 1 Job Description...Page 37 Appendix 2 Contract of Employment... Page 38 Appendix 3 Occupancy Agreement... Page 42 Appendix 4 Disciplinary and grievance procedure... Page 45 2

3 Introduction Most village halls employ some staff, either full time or part time, and as a result they must be aware of their responsibilities as employers. This information sheet aims to highlight some of the issues that must be considered by village hall management committees intending to employ or direct someone to carry out a particular job. It should be stressed that it is not exhaustive in detail but is intended to act as a pointer to what is required and to indicate where to go for additional information. 1 Who is an employee? Having considered the issues relating to employment this section looks at the definition of an employee to enable you to decide the status of those carrying out various roles in your hall. Employment status Employment law distinguishes between people who are employees and those who are workers. Only employees, as opposed to workers, are entitled to key employment rights such as: the right to claim unfair dismissal, statutory redundancy payments, maternity and parental leave, statutory sick pay and statutory dismissal and disciplinary procedures as well as most of the grounds for claiming paid time off. Workers will, however, be protected by the Working Time Regulations 1998, the National Minimum Wage Act 1998 and anti-discrimination legislation. The truly self-employed have no employment related rights whatsoever. What is an employee? Legal definitions of employee vary depending on the circumstances. For example, it is possible, in certain circumstances, for a person to be regarded as an employee for HM Revenue and Customs (i.e. tax and National Insurance) purposes, but as self employed for other purposes. The essential characteristics of the employment relationship are these: (a) An irreducible obligation upon the worker to do work in return for benefits (financial and/or in kind) and (b) Mutual trust and confidence between employer and worker, and some or all of the following characteristics: specific duties, and requirements concerning when and how they are to be fulfilled control of the work by the employer the worker does not provide her/his own equipment the worker is an integral part of the employers organisation and forms part of the employer s administration the worker must give personal service, i.e. cannot get someone else to do the work 3

4 the worker bears no degree of financial risk the worker enjoys other benefits of employment, e.g. paid holidays, pension contributions, a sick pay scheme, etc There is no single test of what constitutes employment. Although the courts may attach more weight to one of the above characteristics over another or others, usually it is a mixture of characteristics that point to whether someone is an employee or self-employed. In cases of doubt, the courses of action to follow are: to ask the question, Does this person, in relation to this particular activity, have one or more of the above characteristics? if the answer to that question is no one may then (at least provisionally) conclude that they are not an employee; if the answer is yes it is safest to assume that they are an employee, and to treat them as such In cases of continuing doubt, to seek advice from HM Revenue and Customs, and/or from other appropriately qualified professional advisers. Different types of working relationships that can constitute employment Self-employment As suggested above, a person may be self employed for HM Revenue and Customs purposes, but employed from the point of view of employment law. As a broad generalisation, it is possible to apply the HM Revenue and Customs criteria as a basic rule of thumb - provided they are applied not to the person but to each particular set of work commitments. HM Revenue and Customs criteria are that self-employed people: take risks with their own money in taking on the work - for example, they cannot demand extra payment if the work takes longer than originally planned are able to engage others to do the work on their behalf can decide where, when, and how the work is done (dependent on circumstances - for example, a self-employed bricklayer will not be able to decide where a wall is to be built, but may be able to decide whether the work is done on a Tuesday morning, a Thursday evening or a Saturday afternoon) have to put right unsatisfactory work in their own time and at their own expense; and provide their own equipment Village halls must be careful when giving work to someone who says that they are self-employed. Village halls must be careful when giving work to someone who says that they are self-employed. The problem is not about circumstances where a village hall asks a plumber to mend a leak in the hall or an electrician to install new cabling: rather the concern is that an individual offering themselves for a particular piece of work may be not be truly self-employed in the eyes of the law of the Revenue. Thus, a person answering an advertisement for a village hall cleaner may claim to be self-employed but, if they do not satisfy the Revenue s criteria described above, the village hall may find itself liable to the Revenue for unpaid income tax and National Insurance. 4

5 Agency workers The normal arrangement is that, where a worker is provided by an agency, the workers contract is with the agency and the organisation with which the worker is placed will also have a contract with the agency. Neither of these contracts, usually, will be a contract of employment. Beware though; following a recent court decision, considerable amounts of work provided over a lengthy period of time for the same worker through an agency may be regarded as conferring employment rights. Beware also of agency workers who progress from a temp to perm arrangement. It is possible for a short period of initial agency work to count towards their continuous service. Casual workers In what circumstances can a casual worker gain statutory employment rights? Whenever a casual worker works for a village hall and their employment has one or more of the characteristics described on page 1, he or she will be an employee and will have some employment rights. In the normal course, once they cease to work for the village hall they cease to be an employee. The issue for a village hall is whether the casual worker can gain the same statutory employment rights as regular employees. The casual worker will only gain such rights in circumstances where they have continuity of employment for a sufficient amount of time, i.e. when they cease to work for the village hall there is still, in law, a contract of employment in place. A continuous contract of employment will exist in two sets of circumstances (i) where there is a global contract covering breaks in work, and (ii) where any periods of inactivity are classed as temporary cessations of work within the Employment Rights Act Global contract For a global contract to exist there must be, amongst other factors, first, mutuality of obligations, namely an element of obligation going both ways, i.e. an obligation on the employer to supply work and an obligation on the worker to take it. Second, the relevant documents, the surrounding circumstances and how the parties conducted themselves subsequently must infer an intention on the part of both the employer and the employee to create an employment relationship which subsists when the employee is not actually working. Temporary cessations of work It is the cessation of work for an individual employee that is relevant rather than the wholesale stoppage of work by the employer. Given that employment patterns of casual staff tend to be irregular, the issue of whether a past cessation was temporary requires consideration of the whole relationship between the employer and the employee. The duration of each past absence must be evaluated against the length of the total relationship and not just against the periods of work immediately surrounding the absence. Putting this more simply, if a casual worker happens to work on an irregular basis (perhaps with long time gaps between work) but is regarded as available at any time to work and expected to turn up when asked, then they may become an employee having continuity of employment. 5

6 If, on the other hand, there is a recognised custom and practice for casual workers to be engaged by a village hall for particular types of work but without any obligation to do the work, then even a long period of casual working may not result in a continuous employment relationship. Typical examples of casual workers might be bar staff used on an occasional basis from a pool, who can choose whether to accept work or not, and hall sitters paid to oversee a private function in a village hall on a Saturday night, again subject to their availability. If a village hall employs casual workers it must remember that the situation which prevails when the casual employment begins may not always continue. Casual workers sometimes drift into a situation when they are working continuously for the village hall or expectations arise on both sides that work will be offered and that it will be accepted when offered. Village halls must therefore keep the employment of casual workers under regular review. Casual staff have access to various statutory protections that are available, regardless of length of service, not only to employees but also to other workers, i.e. those operating under contracts (which need not be written or even expressed) personally to execute any work or labour. These are: protection against deductions from wages protection from discrimination on the grounds of race protection from discrimination on the grounds of sex and sexual orientation, including the right to equal pay protection from discrimination on the grounds of disability protection from discrimination on the grounds of religious belief protection from discrimination on the grounds of age protection from discrimination on the grounds of part-time status rights regarding the national minimum wage rights regarding working time; and the right to be accompanied at disciplinary and grievance hearings. Employee or worker? An employee is someone who works under a contract of employment. A worker is defined as: a person who works under a contract of employment or any other contract whereby he or she undertakes to do or perform personally any work or services for another party to the contact. A worker is not an employee but he or she has certain rights. A worker has the benefit of protection under: An employee is someone who works under a contract of employment. National Minimum Wage Act 1998 Working Time Regulations 1998 Anti-discrimination legislation 6

7 An employee is entitled to the following rights: Immediately: written statement of employment particulars the national minimum wage statutory sick pay time off for public duties, e.g. jury service time off to look for work or make arrangements for training when being made redundant time off for antenatal care, ordinary maternity leave time off for domestic emergencies protection under Health & Safety Regulations notice periods e.g. termination of employment trade union rights, e.g. time off for trade union duties and activities right to be accompanied by a trade union official or work colleague to a disciplinary or grievance meeting rights under the Working Time Regulations 1998, e.g. rest breaks (daily and weekly) rights under the Data Protection Act 1998 rights under the Human Rights Act 1998 rights under the Public Interest Disclosure Act 1998 not to be discriminated against or to suffer a detriment by reason of seeking to enforce that right, in relation to the protected characteristics covered by the Equality Act 2010 (see section 5) If part-time: the right not to be treated less favourably in their contractual terms and conditions than comparable full-timers, unless different treatment is justified on objective grounds. If employed on a fixed term contract: the right not to be treated less favourably than comparable permanent employees because of their fixed-term status, unless the difference can be objectively justified. After 26 weeks continuous employment: additional maternity leave request flexible working arrangements paternity leave adoption leave After two years continuous employment, the right not to be unfairly dismissed. This applies only to employees whose qualifying period starts on or after 6 April 2012 so anyone employed by the employer on 5 April remains able to claim unfair dismissal after only one year. After two years continuous employment, the right to receive redundancy pay. 7

8 Part-time employees: You should provide a contract of employment no matter what the job or the number of hours involved. Part-time workers are entitled by law to many of the same rights as full-time workers, for example, once they have been continuously employed for the required period, the right not to be unfairly dismissed and the right to compensation on redundancy. There is proportionate entitlement to the same sickness, holiday terms and pay as full-time employees. Failure by an employer to treat part-time workers equally with full-time staff, or to give proportionate rights, can lead to a claim to an employment tribunal. Part-time workers are entitled by law to many of the same rights as full-time workers. In any event, you should have regard to all current equal opportunities and anti-discrimination law and practice. Additionally, take into account the codes of practice issued under the Equality Act 2010 (see Further Information). Fixed-term employees The Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 apply to the narrower category of employee, rather than worker. Mirroring the Part-time Workers Regulations, a fixed-term employee has the right not to be treated less favourably than comparable permanent employees as regards: (a) the terms of his or her contract of employment; or (b) by being subjected to any other detriment. This expressly includes the right not to be treated less favourably in relation to service qualifications (so far as they relate to any particular condition of service) and the opportunity to receive training and secure permanent employment. Fixed-term contracts are often used in the voluntary sector to reflect the fact that some employment positions are grant-dependant. However, fixed-term contracts (e.g. of less than one year) should not be used as an attempt to avoid the employee gaining unfair dismissal rights etc. Note that the Regulations give fixed-term employees the right not to be employed on a series of successive fixed-term contracts beyond four years unless this can be objectively justified or a collective or workplace agreement provides otherwise. If a fifth successive fixed-term contract is entered into, he or she will be deemed to be a permanent employee and the, fixed-term shall have no effect. Employment Status Indicator HM Revenue and Customs has set up an Employment Status Indicator (ESI) which is available on their website at This provides a series of questions designed to ascertain employment status for tax purposes and covers issues such as the obligation to provide personal service, control and financial risk carried by the individual. The ESI includes questions covering the employers sector and the job. Employers who comply with certain conditions (such as retaining copies of the result and the ESI reference number) can rely on the result when dealing with HMRC over pay disputes. 8

9 2 The legal responsibilities of village hall management committees Members of the management committee have a number of legal responsibilities which they should take into account when considering employment issues. Some of these responsibilities can be covered by insurance. Existing and potential members of management committees should not be put off continuing or starting their involvement with the village hall just because these potential liabilities exist. All health and safety issues should be addressed in a positive manner so as to reduce, if not eliminate exposure to liability. 2.1 Insurance Employers must provide insurance for all employees to protect against accidents; this is required under the Employers Liability (Compulsory Insurance) Act In practical terms, virtually anyone, whether full-time or not, whether national insurance contributions are involved or not, who receives pay for doing something, is likely to be considered an employee under this Act. All employers must provide employers liability insurance and the insurance certificate must be displayed on the notice board. A claim against an employer might, for example, be made if there had been a failure to provide a safe environment for the employee to work in, and an accident had resulted. 2.2 Pensions There is currently no requirement for a village hall management committee that employs up to five people to make pension arrangements for those employees. From 2012 under the Pensions Act 2008 (with subsequent changes brought in by the Pensions Act 2011) all eligible workers who are not already in a workplace scheme, will be automatically enrolled into a new savings vehicle, which is to be known as a personal account scheme. The village hall management committee will be required to contribute. An eligible worker is one aged between 22 and state pension age; and earns more than the automatic enrolment earnings trigger) in the relevant pay reference period. The automatic enrolment annual earnings trigger is 8,105 in (equivalent to 156 per week, 676 per month), in line with the tax threshold. The earnings trigger will be reviewed annually, taking into account not only tax and NI thresholds but also economic circumstances and people s savings behaviour. 9

10 2.3 Health and Safety Statutory Rights of employees Section 44 of the Employment Rights Act 1996 gives statutory rights for all employees (regardless of the hours worked or their length of service) in connection with the health and safety legislation. In summary, safety representatives and other employees have the right to carry out activities in connection with current health and safety legislation without the risk of being dismissed, made redundant or otherwise treated less favourably for doing so. This could include for example: advising or consulting with the employer on health and safety issues leaving the workplace where they reasonably believe there to be immediate danger taking reasonable steps to protect themselves or others from immediate danger The Public Interest Disclosure Act 1998 gives workers legal protection if they raise issues of serious concern about their workplace, including safety concerns, with their employer. Workers now have protection against victimisation or dismissal if they blow the whistle on their employers and will be able to take their case to an employment tribunal. The statutory duties of employers These are covered by the Health and Safety at Work etc Act 1974 and regulations made under it. Certain parts of this Act apply to village hall management committees even where they do not employ anyone: this arises because they admit the public to their premises. Under the terms of the Act, an employer must provide: a safe place of work safe means of access to and exit from the workplace proper supervision of employees to ensure their health, safety and welfare at work information on health and safety training on health and safety adequate working conditions. Ventilation and temperature should provide reasonable comfort and be at least 16ºC Further, every employer must conduct its undertaking to ensure, as far as reasonable practicable, that persons not in their employment, who may be effected by their undertakings, are not exposed to risks to their health or safety. Each must give to persons (not being their employees) who may be affected by the way in which they conduct their undertaking, information that might affect their health or safety. Information Sheet 15, Health & Safety legislation and village halls, provides further information and guidance on the statutory requirements of health and safety legislation. 10

11 Every employer must, by law, display a poster or distribute a pocket card setting out information on health and safety law. This was updated in April 2009 but the pre-2009 version can continue to be displayed until 5 April 2014, provided the contact details are up to date. The poster, pocket cards and other formats can be ordered from HSE Books (tel: ) and booksellers. Employers can check that they have a genuine HSE law poster by checking the unique, serially numbered hologram on each poster. The poster is printed using a new fully bio-degradable form of plastic. At current VAT rates the standard version costs The semi-rigid version costs Packs of the pocket card cost Each employer of more than five persons must have a written health and safety policy. Health and Safety policies Each employer of more than five persons must have a written health and safety policy which should be brought to the attention of each employee (particularly new staff). Village halls that have fewer than 5 employees or only use volunteers are not obliged to have a health and safety policy, but are strongly recommended to draw one up. You do not have to give everyone a copy. A health and safety policy is the foundation on which to develop health and safety procedures and practices. The policy announces the level of commitment of those who manage or are responsible for the organisation towards good health and safety standards. The policy can help to clarify procedures and areas of responsibility. If an organisation uses volunteers, they should always be included in the health and safety policy, as a matter of good practice. There is a sample health and safety policy in Information Sheet 15, Health & Safety legislation and village halls. The HSE also have examples of model health and safety policies which can be used as a template. Accidents at work All accidents at work must be recorded in an accident book - Reporting of Injuries, Diseases and Dangerous Occurrences Regulations 1995 (RIDDOR). From 6 April 2012, work-related injury or illness had to be reported to HSE only if it leads to absence from work, or the person being unable to carry out their normal work, for more than seven days, rather than more than three days as the law has been. The days absent or incapacitated do not include the day on which the injury occurred. 11

12 3 Contract of employment and job description This section looks at what should be included in each of these documents and provides models at Appendix 1 and 2. Contract A contract comes into existence once the employee has accepted the job offered by the management committee. This is the case whether the offer, the acceptance or anything else relating to the job is in writing or not. The actual terms and conditions of employment may include: (a) express terms - these are terms that are discussed and agreed (whether in writing or not) between you and the employee. (b) implied terms - these are terms which may include: terms that are too obvious to mention (e.g. not to steal from employer) those necessary to make the contract workable (e.g. a person employed to drive must have a current driving licence) although it is better for such terms to be put in writing, and those that are custom and practice of the community sector, e.g. that the employee is entitled to take part in community activities, or to represent the organisation at external events terms incorporated by reference - these are terms that exist in other documents (e.g. agreements with trade unions) which are referred to in the contract and to which the employee has access, e.g. on a notice board. In addition, all contracts of employment are covered by relevant statute law (which gives minimum rights to employees) - see Sections 4 to 6 below. The main legislation covering the written terms and conditions of employment is to be found in the Employment Rights Act Under this, all employees, irrespective of their hours of work are entitled to receive a written statement of the terms and conditions of their employment within two months of starting work. Is the written statement of terms and conditions the same as a contract of employment? No. The written statement is the minimum information that an employer must give to their employee - just because a written statement makes no reference to something (e.g. certain perks of the job) that it is not required to do by the Employment Rights Act 1996 does not mean that such perk is not contained (whether expressly, impliedly of by reference) in the contract of employment. Confusion can arise between the written statement and the contract of employment particularly where they contain different terms and conditions! Certain specified terms and conditions of employment must be given to an employee. These particulars can be given in installments but it is better to include them all in a single document. 12

13 The written statement must contain the following: the names of the employer and the employee the date when the employment (and, if different, the period of continuous employment) began wages or salary and the intervals at which they are to be paid hours of work holiday entitlement place of work The written statement must also contain or refer the employee to documents detailing: the employee s required and permitted places of work the address of the employer (if based at a different location) the type of employment: casual, temporary, fixed-term or permanent where it is not permanent, the period for which the employment is expected to continue, or if it is for a fixed-term, the date when it is to end the method of payment of wages or salary holiday entitlement, including public holidays, holiday pay, including any entitlement to accrued holiday on termination of employment entitlement to sick leave and sick pay maternity entitlements pensions entitlement, including whether a contracting-out certificate is in force (where the employer has opted out of the government scheme) entitlement of the employer and the employee to notice of termination job title or brief job description disciplinary rules and procedure, appeals procedure grievance procedure existence of any collective agreements that directly affect the employees terms and conditions. So what should we do about a contract of employment? It is recommended that village hall management committees use the form of Contract of Employment set out in Appendix 2, which has been designed in relation to the employment of a caretaker. This does the job of specifying the written terms and conditions as required by the 1996 Act and being the document into which other terms and conditions of employment can be included. Disciplinary and grievance procedures As from 6 April 2009 the old statutory disciplinary and grievance procedures are abolished and in their place the Government has introduced the ACAS Code of Practice. Following the government s red tape challenge on employment-related regulations in October 2011, the Department for Business, Innovation and Skills is considering whether the current ACAS code of practice on discipline and grievance could be adapted to make it easier to use and more accessible to small businesses (which will include village halls). For further detail see Section 8. 13

14 What if the terms are to be changed? There are two issues here. First, as an employer a village hall management committee cannot change an employee s contract of employment without his or her agreement. Second, any change in the terms required by law to be included within the written statement must be notified to the employee in writing within one month of the change. There is no set form that the written statement must follow provided that it clearly states the information required. All employees should be provided with a job description which sets out clearly their duties. Job description All employees should be provided with a job description which sets out clearly their duties and this is particularly true for employees such as caretakers and cleaners who may be largely unsupervised. It can be helpful for the management committee to draw up a job description before the position is advertised and this will enable them to decide on the number of hours which will need to be worked and the appropriate level of pay. The duties set out in the job description can later be incorporated into the Contract of Employment. An example of a Job Description for a caretaker is shown at the end of this information sheet as Appendix 1. Once a job description has been drawn up and the duties agreed with the committee it should not be altered without agreement. Points to include: the job title the main purpose of the job to whom the person is responsible (i.e. the point of contact with a member of the management committee). To avoid potential problems with changes in membership of the committee, the point of contact should be a named officer such as the treasurer or secretary. hours of work the main tasks in order of importance - these should be listed in detail and the extent of responsibility defined others for whom the employee is responsible for example a cleaner procedure for bookings arrangements for keys emergency telephone number management of cash. 14

15 4 Employee s Statutory Rights This section looks in some detail at the statutory rights afforded to employees. Some apply upon the start of employment, others after a period of continuous employment. Keeping records There is a legal duty for employers to keep detailed records of pay, hours worked, tax, national insurance, statutory sick pay and statutory maternity pay. It is also important to keep details about employees, e.g. next of kin, address, job description, etc. National Minimum Wage (NMW) All village hall employees and workers must be paid the NMW. A village hall management committee should be fully aware of the National Minimum Wage Act 1998 and the Working Time Regulations 1998 because they lay down onerous obligations (e.g. maintaining workers records) and failure to comply can result in criminal proceedings against the committee. ACRE strongly recommends that village halls obtain a copy of the guidance issued by the Department of Business, Innovation and Skills. See page 36 for contact details. The current levels of the National Minimum Wage The rates from 1 October 2012 are: workers aged 21 and over, the NMW is 6.31 an hour workers aged 18-20, the NMW is 5.03 an hour, and workers aged 16-17, the NMW is 3.72 an hour (above compulsory school leaving age). For workers over 20 who are starting a job with a new employer and are receiving accredited training, the minimum rate is the same as the year old rate for the first six months. It then goes up to the full adult rate. The minimum wage rate for apprentices is 2.68 per hour for those under 19 or in their first year. If they are over 19 or past their first year they get receive the rate that applies to their age. The Working Time Regulations 1998 In regard to employees and workers these regulations: 15

16 set a working limit (including overtime) of 48 hours a week (calculated as an average over a 17 week period) require employers to take all reasonable steps, in keeping with the need to protect the health and safety of workers, to ensure that this limit is not exceeded give specific protections for night workers, including health and safety assessments specify requirements for daily rest, weekly rest periods and rest breaks at work grant a statutory right to paid annual leave give enforcement powers to the Health and Safety Executive and establish specific criminal offences and remedies for failure to comply Apart from paid annual leave (see below) it is unlikely that the above will apply to a village hall. However these Regulations are essentially a health and safety measure and an employer must address the question of working hours in a positive way. A particular problem for village halls arises where a part-time employee does another job or other jobs. Once the village hall committee becomes aware of this, they must ask the employee to tell them the exact number of hours he or she is working each week. If it appears that they are spending too much time working at all their jobs or are approaching the 48 hour limit then the committee is under a duty to tell their employee that he or she should either cut down their time spent working or agree to exclude the 48 hour rule. ACRE strongly recommends that, even if a village hall does not buy a copy of the Regulations, it obtains a copy of the guidance issued by the Department of Business, Innovation and Skills (Page 36 for further Information). Holidays The Regulations provide workers with the right to 5.6 weeks paid holiday each year. This includes Bank Holidays. After starting their employment, the worker s statutory leave entitlement accrues at the rate of one-twelfth (of the entitlement) for each complete month s employment. In practice, a week s leave should be equivalent to the time a worker would work in a week. In general this should be straightforward. If a worker works a 4 day week then they are entitled to 5.6 four day paid holiday weeks, or to put in another way, they are entitled to be paid for 22.4 days time off work (i.e. 5.6 x 4 day week). As this entitlement is a health and safety issue, the employer must allow the employee his or her holiday entitlement. Parttime workers and seasonal workers are entitled to paid annual leave on a pro rata, or proportionate, basis. Workers who are on sick leave for the whole or part of a year, and are unable during that year to exercise their right to paid annual leave, retain their right to take that leave subsequently, or must be paid in lieu of it if their employment is terminated before they are able to take it. Itemised pay Employees have a statutory right to receive individually from their 16

17 employers a detailed written pay statement at or before the time of payment. The statement should include: gross amount of wages or salary the amounts of any fixed deductions and the purpose for which they were made the amounts of any variable deductions and the purpose for which they were made net amount of wages or salary payable Take care to check the tax status of all people working in the village hall regardless of how much they are paid. Further details are outlined in Itemised Pay Statement (PL704) available from your local DSS office. Under Section 8 of the Employment Rights Act 1996, employees are entitled to an itemised pay statement. Income Tax and National Insurance It is the employer s duty to deduct income tax from the pay of an employee whether or not directed to do so by the tax office. If, for any reason, there is doubt as to whether income tax is payable or not, or the position is unclear, contact your tax office. National Insurance contributions are related to employees earnings and are collected along with income tax under the PAYE procedure. There are PAYE and National Insurance contribution lower earnings limits below which tax and national insurance may not be payable. Full details of these thresholds, which change annually at budget time, are to be found in Employers Guide to PAYE (PT). But, BEWARE - if the employee has any other income (including a pension) this will also have to be taken into account for tax purposes. Take care also to check the tax status of all people working in the village hall regardless of how much (or how little) they are paid. It may be that HM Revenue and Customs could consider them employees from whom PAYE should have been deducted. Small employers, like village halls, often pay cash on a cash in hand basis. This constitutes payment on a free of tax basis and, whilst it is allowed by HM Revenue and Customs, the employer must follow special procedures to make sure it works out the correct amounts of PAYE tax and National Insurance Contributions (NICs) that it will need to pay to HM Revenue & Customs. What the employer has to do depends on whether it pays some or all of the employee s wage free of PAYE tax, and whether it also agrees to pay the employee s NICs on their behalf. If you agree to make any payments like these that are free of both tax and NICs you should contact the HMRC Employer Helpline ( ) Village hall committees should contact their local tax office when they become employers to discuss whether deductions need to be made in individual cases. 17

18 Statutory Sick Pay Any employee who attracts a liability for Class 1 National Insurance contributions would be entitled to receive statutory sick pay. It is the employer s responsibility to pay out statutory sick pay and then reclaim it from National Insurance deductions before making payment to the Collector of Taxes. Certain employees are not entitled to SSP, e.g. employees aged 65 or over (both men and women). Full details are outlined in Employers Guide to National Insurance Contributions (NP 15) available from your local DSS office. Statutory Maternity Pay The employer is responsible for the payment of statutory maternity pay. If an employee has worked for the same employer for a minimum of 26 weeks ending with the qualifying week, i.e. the 15th week before the baby is due, and has average weekly earnings of not less than the lower earnings limit for the payment of national insurance, then she may be entitled to statutory maternity pay. Full details are outlined in Employers Guide to Statutory Maternity Pay (NI 257) available from your local DSS office. Redundancy Employees who have worked for the same employer for a minimum of 16 hours per week for at least two years may be entitled to redundancy pay, the size of which will depend on the employee s pay and length of service. Further details can be found in the booklet Redundancy Payments (PL0808) available from the Department for Employment and Learning. Volunteers and voluntary workers Most volunteers and voluntary workers will automatically be excluded from the National Minimum Wage Act because they are not covered by the definition of worker, i.e. no contract of employment or other contract to provide their services personally. However, circumstances can arise whereby a village hall enters into a legally-binding contract with a volunteer (whether it intended to do so or not) under which the volunteer agrees to provide their services personally. This can happen where a village hall treats its volunteer in exactly the same way as an employee or where it makes payments or provides other benefits in return for a work commitment from the volunteer. The Act recognises that some volunteers can fall within the definition of worker in circumstances where it would not be right for them to receive the NMW. To counter this, the Act specifically excludes volunteers who receive: no payment other than reimbursement of expenses actually incurred, and no benefits in kind other than the provision of: reasonable subsistence or accommodation where appropriate (e.g. voluntary workers and a youth hostel) training to enable the volunteer to do their voluntary work 18

19 5 Anti-discrimination legislation This section sets out the areas of anti-discrimination law currently in force and which apply to village halls. Discrimination law was formerly contained in a number of different Acts of Parliament, each covering a different area of discrimination. This approach is disjointed and as such, is sometimes inconsistent and unclear. The Equality Act 2010 has been created to consolidate and harmonise 40 years worth of discrimination legislation into a single act. Some of the acts which the Equality Act will encompass include: Equal Pay Act 1970 Sex Discrimination Act 1975 Race Relations Act 1976 Disability Discrimination Act 1995 Employment Equality (Age) Regulations 2006 Employment Equality (Religion or Belief) Regulations 2003 Employment Equality (Sexual Orientation) Regulations 2003 The following will explain what changes the Act makes to discrimination law and how this will affect your village hall. Protected characteristics Previous legislation dealt with discrimination towards certain groups separately. This act brings all these groups together and refers to the groups as protected characteristics. The protected characteristics covered by the Act are: sex age disability gender reassignment marriage or civil partnership pregnancy and maternity race religion or belief sexual orientation Treating a person in a less favourable way than others because of one of the protected characteristics listed above will amount to discrimination. 19

20 What changes does the Act make? The Act makes many changes, some more far-reaching than others. The following will note some of the more significant changes but does not list every change. (a) Direct discrimination There are new forms of direct discrimination that will protect more people from discrimination. The first of these is discrimination by association. This is where a person is treated less favourably than others simply because they are connected or associated with a person who does have a protected characteristic. For example, if a person was refused entry to a community building because they had a disabled parent. Another form of direct discrimination is discrimination by perception. This is where you are discriminated against because people believe that you have a protected characteristic even though you do not. For example, if a woman was told she was not welcome in a shop because the owner believed she was a transsexual. She can make a claim for discrimination because of gender reassignment even though she is not actually undergoing (or considering) gender reassignment. (b) Dual discrimination A person will be able to bring a discrimination claim based on two of the protected characteristics together. The example that is given in the explanatory notes to the Act is that of a black woman being refused a job in reception because the employer believes black women are not suited to customer service roles. The woman could bring a claim of discrimination both for sex and race because a white woman or a black man would not have been treated in the same way. It was the combination of characteristics that led to the discrimination. The government announced on 23 March 2011 that it was not going to implement this right (even though it is still possible for claimants to make two or more separate claims). The government has now announced the dual discrimination provisions are being delayed, which implies they may still be implemented rather than repealed. (c) Positive action Positive action means that employers can favour a person with protected characteristics when they are recruiting. This can only be the case when the person with the protected characteristics is at least as qualified as the other applicants. This cannot be a blanket policy and can only be used where it is a proportionate means of achieving a legitimate aim, namely the person with protected characteristics overcoming their disadvantaged position. It could also be used to encourage more people with that protected characteristic to apply for jobs in that sector or service providers could target groups with that characteristic because of they are disadvantaged because of that characteristic. (d) Secrecy clauses Secrecy clauses are those clauses in contracts that prevent employees from discussing their pay with other employees. The Act protects any employees who are discussing their pay in order to establish whether discrimination is taking place from any negative repercussions from their employer. Any employer who is found to have instigated disciplinary procedures against employees for breaching a secrecy clause will leave themselves open to claims of victimisation. 20

21 (e) Discrimination arising from disability This is a new provision that prevents discriminating against a person not because of a disability but because of a consequence of that disability. The example that is given in the Explanatory Notes to the Act is of a publican refusing to serve a person because he believes that person is drunk because he is slurring his speech. In actual fact the slurred speech is a consequence of the person having cerebral palsy. The publican is potentially facing a claim of discrimination arising from disability unless: he can show that his actions were a proportionate means of achieving a legitimate aim and/or he did not know or could not reasonably have known that the person suffered from a disability or that the behaviour was a consequence of a disability. If either of these points could be shown then there would not be a discrimination case (f) Indirect disability discrimination Indirect discrimination is already available for most types of discrimination but the new Act applies it to the protected characteristic of disability. Indirect discrimination is where a practice, provision or criteria is applied to all employees (or potential employees) that will put people with one of the protected characteristics at a disadvantage compared to people who do not have that characteristic. An example would be job applicants having to complete a written test as part of an assessment day. This practice applies to everyone but a blind or partially sighted person would be at a disadvantage compared to everyone else. The employer would need to have an alternative, such as the test written in Braille or having the opportunity for a verbal test instead to avoid indirectly discriminating against a disabled person. Indirect discrimination applies to all the protected characteristics except for pregnancy and maternity. How can my village hall deal with the Act? The Act is largely in force and there are a few things your village hall should be doing to ensure it can comply. Be prepared! Make a note of what changes are happening and when they come into force. Find the relevant Code of Practice and any published guidance. Take time to consider your membership policy, the service you provide and/or your building. Can you see anything that could be considered discriminatory under the new Act? Share ideas with other organisations in your area, do they have any good policy ideas or can they spot any problems you ve missed? Conduct a survey of members/service users to see if they have experienced any problems. 21

22 Check whether your contracts of employment are up to date. Ensure there is a clause explaining that you expect all employees and volunteers to adhere to equality laws and anyone considered to be behaving in a discriminatory way will be disciplined. Review your existing Equal Opportunities Policy to ensure it is up to date or create one. See Information Sheet 42, Equality in village halls for further information When you hire out your building or services to other organisations ensure that you put a clause in the hire contract to say you expect them to follow equality laws at all times. There are likely to be quite a few training courses on the changes the new Act will be making. Sending staff and trustees on these courses could educate them and prevent problems occurring. Finally, if you are uncertain about any aspect of the Act or think you might have some problems with discrimination then seek legal advice. 6 Family friendly rights Maternity rights and benefits Employers have certain legal obligations towards pregnant employees. Ordinary maternity leave All pregnant employees are entitled to OML. The length of this leave is 26 weeks. Compulsory leave This is a period of two weeks immediately after giving birth during which the woman is not permitted to work. This is part of the ordinary maternity leave period, not additional to it. Additional maternity leave (AML) Pregnant employees who have completed 26 weeks service or more with their employer by the beginning of the 14th week before the week the baby is due are entitled to AML. This begins from the end of the OML and is for a period of a further 26 weeks. Part of AML is unpaid. However, some organisations have more generous contractual terms and pay a woman during all her AML. Statutory Maternity Leave (SML) This is the term for the combined 52 weeks of leave. There is no qualifying period for the 52 weeks of leave but there is a qualifying period for some of the statutory maternity pay. The earliest date a woman can start maternity leave is the beginning of the eleventh week before the baby is expected. She must provide her employer with details of the week the baby is expected and the start date of her maternity leave. The employer must respond to this notification within 28 days and state the date by which the woman is expected to have returned to work after she finishes her maternity leave entitlement. 22

23 What special rights do pregnant employees have? It is unlawful to dismiss a pregnant employee (or single her out for redundancy) for reasons connected with her pregnancy or maternity. In addition to maternity leave and pay, women employees who satisfy the relevant qualifying conditions are entitled to: return to the jobs in which they were employed (if returning from OML) or ones of equivalent status (if returning from AML), with protected rights to pay and conditions and benefits time off to attend appointments for ante-natal care at the normal rate of pay, on producing proof of the appointment request a risk assessment during pregnancy request alternative work where any risks to the health of the expectant mother and baby can be avoided remuneration on suspension on maternity grounds, if health and safety measures cannot be complied with not be subjected to a detriment, disadvantage, unfair treatment or dismissal because of the pregnancy, maternity leave, etc. take up to ten keeping in touch days during maternity leave without losing any entitlement to maternity pay. The employer is not obliged to offer any KIT days and the employee is not obliged to work any that are offered Employers should also bear in mind that detrimental treatment of an employee in connection with maternity will be unlawful sex discrimination. Employers should also bear in mind that detrimental treatment of an employee in connection with maternity will be unlawful sex discrimination. Is the employee entitled to go back to her old job when she returns from maternity leave? Yes. She is entitled to resume her normal job on the same terms and conditions as if she had not been absent. If a redundancy situation arises during her maternity leave, she must be offered any suitable alternative work that is available at that point. Parental rights and time off for domestic emergencies Under the Maternity and Parental Leave etc. Regulations 1999, employees who have been continuously employed for at least one year with the employer and has, or expects to have, responsibility for a child, are entitled to 13 weeks leave unpaid during the first five years of the life of a child for whom they have responsibility. This right is in respect of each child. Such leave must be taken in blocks or multiples of blocks of one week, with up to a maximum of four weeks in each year. Parents of disabled children may take less than one weeks leave. Any leave taken requires 21 days notice to be given to the employer which specifies the dates on which the period of leave is to begin and end. Other than in cases where the period of leave starts with either a child s birth or in the case of adoption a child is placed with the employee, the employer may postpone the leave for up to six months where the business would be unduly disrupted if the employee took leave during the period identified in the notice. The employer must give the employee, within seven days after the employee s notice was given to the employer, notice in 23

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