The recent U.S. Federal Trade Commission (“FTC”) proposal to ban employers from imposing non-competition clauses (“non-competes”) on their workers has sparked lively debate. Support comes from those who believe the proposed rule would encourage entrepreneurship and innovation1 and ultimately accelerate economic growth. On the other hand, critics of the proposed rule argue that non-competes are necessary to protect confidential information, such as marketing strategies or pricing plans,2 although much of the opposition is focused on whether the FTC has the legal authority to pass the rule.
It is difficult to predict whether the proposed rule will actually come to pass but there have been 5000 public comments on it so far. It may be instructive to consider the treatment of non-competes in other common law jurisdictions like the United Kingdom (“UK”) and Singapore, where competing interests between the right of an employer to protect is confidential information, retain employees, and reduce competition are balanced against employees’ rights to market mobility, sometimes in slightly different ways and with different outcomes.
This article will attempt to briefly summarize the employment landscape in each jurisdiction with respect to non-compete agreements, highlight some differences between them, and in turn demonstrate the nuances between the jurisdictions, and their reputations as pro- employer or pro-employee jurisdictions.
With England one game away from the World Cup Final, the country is overjoyed at the success England have had so far.
According to a survey conducted by Viking-Direct, 46% of England fans say they would call in sick on the Monday if England win the World Cup on Sunday. How can employers minimise the number of unauthorised absences during the day of the Final, and the day afterwards?
Both Lidl and Aldi have pledged to close all their stores in England at 3pm on Sunday should England be in the final. The early closure will allow their employees to watch the game without having to call in sick or take a day’s holiday.
Read more: Employers and Flexibility for the World Cup Final
This year is already set to be a busy one for employment law and HR practitioners with a list of forthcoming legislation changes in the pipeline. Here's a brief guide for business owners on some of the key changes for 2017.
National Living Wage
This is a forthcoming change that has been relatively well publicised. The government announced in its November 2016 autumn statement that the National Living Wage (NLW), currently set at £7.20 for workers aged 25 and over, will increase to £7.50 from April 2017. The changes to the National Minimum Wage (NMW) for workers under the age of 25 may require closer attention year on year due to the rates being highly staggered. The rate for 21 to 24 year old workers will rise to £7.05 an hour, the rate for 18 to 20 year olds will increase to £5.60 an hour, and the rate for 16 and 17 year olds will go up to £4.05 an hour. The minimum hourly rate for apprentices will be set at £3.50 an hour.
Apprenticeship Levy
From 6 April 2017, businesses with annual PAYE bills of more than £3 million will be required to pay a levy equivalent to %0.5 of their total annaul salaries to help fund additional apprenticeships over the next five years. Each UK employer paying the levy will receive an allowance of £15,000 to offset against their costs for apprenticeship levvies.
All organisations meeting the salary threshold will be required to contribute, regardless of whether they have apprentices, but those that have apprentices will be able to put the amount owed in a digital apprenticeship service account and, potentially, recover some of it for use in approved apprentice training programmes. Employers will receive a government top-up of 10p for every £1 put into the apprenticeship account.
Gender Pay Gap Reporting
Any gender pay gaps is to become compulsory to report for private sector and voluntary organisations employing 250 or more people under the Small Business, Enterprise and Employment Act 2015. The rules will also be rolled out to large employers (250 employees or more) in the public sector bodies in England but not Scotland and Wales.
The final version of the private sector gender gap information regulations has now been published and is due to come into force on 6 April 2017. Employers in scope will need to publish their first report by 4 April 2018, based on a ‘snapshot’ date of their pay gap on 5 April 2017.
Employers have to analyse and report on the percentage difference between male and female employees, as well as the percentage of men and women who received a bonus in the previous year, and the percentage of men and women in each hourly pay rate quartile.
The Equality and Human Rights Commission can take enforcement proceedings against employers failing to comply with the regulations, and any inaccuracies could lead to adverse inferences being taken against an employer in any subsequent discrimination tribunal claim.
Tribunal Enforcement Penalties
Under the Small Business, Enterprise and Employment Act 2015, which came into force on 6 April 2016, the government can impose a financial penalty on employers that fail to pay compensation awarded by tribunals or sums agreed under an Acas settlement agreement. This would be payable to the state, rather than the claimants. The fine will be 50% of the outstanding award, subject to a cap of £5,000.
The Department for Business, Energy and Industrial Strategy, has produced an employment tribunal penalty form to be used by claimants who have not received a tribunal award or an Acas conciliated payment. Claims for non-receipt can be made 42 days after the tribunal judgment, or following non-payment on the agreed date in a settlement agreement.
Tax on Termination Payments
From April 2018, all payments in lieu of notice (PILONs) will be subject to tax and national insurance contributions (NICs), regardless of whether there is a contractual right to make the payment or not.
The tax exemption for payments up to £30,000 made in connection with termination of employment, such as redundancy, will remain in place, but payments above that amount will be subject to both income tax and employer NICs.
Employees in both the public and private sector who have customer-facing roles are will be expected to be able to speak fluent English to customers. However, how employers assess fluency can be controversial.
The government is planning to bring into force Part 7 of the Immigration Act 2016, which requires all public sector workers in customer-facing roles to speak fluent English. The stated intention is to increase standards in order to meet “the public’s reasonable expectation to be able to speak English when accessing public services”.
Read more: New rules will require public sector workers to speak fluent English
Employees and businesses have been alerted to the underpayment of wages worth thousands of pounds in damages following a major Employment Tribunal ruling involving supermarket giant Asda.
Whilst these claims are nothing new (equal pay between men and women has been law since the Equal Pay Act 1970) the majority of the 1,300 or so claims submitted each month have been against public sector employers.
Read more: Businesses and employees on alert over Asda equal pay case
