Outlining some of the latest European HR, Employment Law and Payroll developments for HR professionals based in North America.
Employment rights post-Brexit
EU nationals in the U.K. post-Brexit
As things currently stand, EU, Swiss or EEA (Iceland, Liechtenstein and Norway) citizens living in the U.K. will need to apply for settled or pre-settled status for themselves and their families, by June 30th 2021, in order to continue living in the UK after that date.
Settled status will be granted, if the applicant has completed a continuous period of 5 years of residence in the UK.
Pre-settled status will be granted for citizens with less than 5 years UK tenure, providing they began living in the UK by end of December 2020 or, by end of March 2019, if the UK leaves the European Union without a deal.
However, Irish citizens or those who already have indefinite leave to remain, do not have to apply.
The process, known as the EU Settlement Scheme will open fully on March 30th 2019 though applicants can apply ahead of that date if they meet the criteria.
If the UK leaves the EU without a deal, applicants must be living in the UK by March 29th 2019 and the deadline for applying is currently set at December 31st 2020.
Originally, an application fee of £65.00 for adults and £32.50 for children was set but these have subsequently been scrapped
U.K. Workers’ rights post-Brexit
Meanwhile, British parliamentarians have been promised a vote on any post-Brexit changes to workers’ rights.
The Prime Minister has said that parliament will be given a say on whether to stay aligned with current EU-granted rights and a vote on whether to adopt any new worker protection rights that may be introduced across the EU after Brexit.
The government has made a commitment not to reduce the standards of workers’ rights from EU laws retained in UK law and the UK Parliament will be given the right to consider and vote upon any future changes in EU law that strengthen workers’ rights or workplace health and safety standards in order to decide whether they should be adopted into UK law.
This new process will start with 2 EU Directives that come into force after the UK is due to have left the EU.
These are the Work Life Balance Directive and the Transparent and Predictable Working Conditions Directive.
The Work Life Balance Directive, due to come into force in 2020, introduces new rights for parents and carers, such as 2 months of paid leave for each parent, up until their child is 8 and also, 5 days of leave for those caring for sick relatives and all working parents of children aged up to 8 will be able to request flexible working.
UK employment rate hits record high
Bank rapidly reverses its working-from-home ban
Bank of New York Mellon has rapidly back-peddled on its decision to ban its 50,000 global employee base from working at home.
Earlier this month, the bank advised all its staff that that they would be expected to be at their desks full-time, other than in unavoidable circumstances.
The move was widely slammed as a backward step, especially by working parents who felt they would be particularly impacted by the ban on flexible working.
But 2 days later, in a follow-up statement sent to all staff, BNY Mellon CEO, Charles Scharf said: “We have decided to immediately hit pause on implementing any changes to remote working arrangements. While we believe that it is enormously helpful to have as many people as possible physically together working collaboratively, we also realise that changes can affect personal lives in many ways.”
Major motivation disconnect between employers and workers
45% of companies believe that salaries motivate employees to move jobs, rather than their working culture.
A survey by one of the UK’s largest recruitment firms, highlights a considerable gap between between what motivates employees and what employers are offering.
73% of professional workers in London said they would strongly consider changing jobs, if their new employer provided a more complete career and life balance.
Jobseekers’ top priorities when looking for a role were; working for a company that values them (25%), gaining experience (17%), a strong work/life balance (17%), and developing technical skills and capabilities (11%).
In addition, 40% of respondents said they would consider working on a temporary, interim or contract position basis, in exchange for greater flexibility and a better lifestyle.
While employees said they value ‘soft benefits’ such as flexible working, work/life balance and ‘being valued’, 45% of employers believe that an attractive salary and overall package is what motivates today’s workforce.
Employers were also found to lag behind on employee progression where, 60% of workers said their career development was a key consideration to accepting a job offer whereas, less than 10% of employers said that a lack of career progression and personal development would be a key reason for losing talent.
When it came to switching jobs, by sector, 50% of IT professionals were said to be more motivated by lifestyle than pay, followed by accounting and finance at 43%, then marketing, PR and advertising at 30%.
U.K businesses are rejecting ‘maternity-age’ candidates
A UK survey has revealed attitudes towards and discrimination against ‘maternity-age’ women in the workplace.
In a survey of 502 respondents carried out by freelance recruitment firm, Worksome, both male and female employers / recruiting decision-makers, admitted to rejecting female candidates who ‘appear to be of maternity age’.
It found that 25% of male and 21% of female recruiting decision-makers, failed to hire candidates who fell within the category. This is despite their stated belief that the candidates were suitable and qualified to fill the role in question.
The results align with a larger national survey in 2016, conducted by the UK Government the Equality and Human Rights Commission which recorded 77% of mothers saying they had a negative or possibly discriminatory experience during pregnancy, maternity leave, and / or on their return from maternity leave with 11% saying they felt forced to leave their job as a result.
In January this year, the government set out new proposals to protect pregnant women and new parents in the workplace. They propose that legal protection against redundancy for pregnant women and new mothers on maternity leave should be extended, so that it continues for up to 6 months after they return to work (see details below).
In the UK, eligible employees can take up to 52 weeks’ maternity leave with 39 weeks Statutory Maternity Pay. The first 6 weeks are paid at 90% of average weekly earnings and the remaining 33 weeks are paid £145.18 (£148.68 from April 2019).
U.K. Government maternity discrimination plans receive mixed reaction
The UK government has laid out new proposals to protect pregnant women and new parents, against discrimination and redundancy.
The proposals are intended to provide further legal protection against redundancy for pregnant women, mothers on maternity leave and parents returning from adoption leave.
In a statement, Prime Minister Theresa May said that, while the country already benefits from some of the most rigorous workplace standards in the world – including parental leave and pay entitlements – her government is determined to do even more on that front, when the UK leaves the EU.
Some employment rights commentators believe the measures do not go far enough and blame underlying factors such as limited parental access to the justice system.
However, some employers’ representatives have expressed concern about the proposed changes, as they believe the proposals will rule-out their ability to make redundancy decisions that impact mothers returning from maternity leave and therefore in their eyes, the new proposals sail too close to positive discrimination.
Though employees on maternity leave can be made redundant, certain employment protections apply, from the beginning of their pregnancy to the end of their maternity leave.
These include, the right to return to the same job before she left, or offering suitable and appropriate alternative employment that is not substantially less favourable than if they had continued to be employed under their original contract of employment.
Employment Law: recent rulings of note
Spain: Data Protection
Following the Europe-wide introduction of the General Data Protection Regulation (GDPR) in 2018, a case arose in Spain, where a supermarket installed surveillance cameras following a suspicion of theft by either customers or staff.
Whilst it installed visible cameras to monitor customers, and notified staff, it also installed covert cameras behind cash desks without
Five employees were caught on camera stealing items for themselves, colleagues and customers.
They were dismissed and brought claims in the European Court of Human Rights (ECHR) for breach of their right to privacy.
The Court ruled that whilst covert surveillance of specific employees already suspected of stealing over a very short period without breaking data protection laws might have been justifiable, directing covert surveillance at all staff during all working hours without a time limitation and against local data protection laws was a breach of the right to privacy.
Under the GDPR employers must carry out Data Protection Impact Assessments where processing is “likely to result in a high risk to the rights and freedoms of natural persons“, such as here.
Staff have a right to privacy even at work and there must be justification for any CCTV monitoring, even if publicised to staff. This is balanced against the employer’s need to protect property and prevent crime.
Covert cameras should only be used in the rarest of cases where prior knowledge would prejudice crime detection and less intrusive means are not available. They should be directed at the fewest people possible for the shortest time possible.
Germany: Carryover and Payment of Unused Leave / Paid Time-off
The European Court of Justice (ECJ) has ruled that an employer could not refuse the carryover of an employee’s paid holiday entitlement, into the following year, unless it could show that it had given the worker the opportunity to take outstanding holiday.
Mr Sebastian W. Kreuziger was a paid legal trainee with the Land of Berlin (Germany).
During the last months of his traineeship, he refrained from taking paid annual leave.
After his traineeship ended, he requested an allowance in lieu of the days of leave which he had not taken. His employer refused his request, saying that Mr. Kreuziger been invited to use up his holiday entitlement, 2 months before the end of the holiday year but that Mr. Kreuziger had decided to take only 2 days.
The ECJ ruled that the worker must be viewed as the weak party in an employment relationship and because of the imbalance in power, it is for the employer to encourage the worker to take outstanding leave in good time and to inform them accurately of the risk and consequences of losing it.
Only if the employer can prove that the worker deliberately, knowingly chose not to take holiday, can it refuse to allow carryover and a payment in lieu for that unused leave, upon termination.
UK: Disclosure of past convictions
The UK Supreme Court has ruled that the requirement for employment candidates to disclose all of their past criminal convictions, is in breach the European Convention on Human Rights.
The Supreme Court rejected 3 out of 4 appeals presented by the Government, regarding the disclosure of “spent” minor past convictions and cautions, by job candidates to potential employers.
At issue were 2 competing public interests; the rehabilitation of ex-offenders and; the protection of the public against people whose past record suggests there may be an unacceptable risk in appointing them to certain sensitive roles.
In relation to all but the more serious offences, the law provides that after the expiry of the set rehabilitation period (determined by the court and the age of the offender), the conviction is treated as “spent” and the individual is under no obligation to disclose it if asked.
However, the right not to disclose does not apply, if the question is asked to assess an individual’s suitability for the admission to certain professions such as, law or medicine or, their suitability for certain kinds of employment, such as, working with children or vulnerable adults.
In a complex ruling, the Supreme Court held that in the cases presented by 3 of the 4 individuals, the criminal records system was in breach of their right to privacy and was incompatible with Article 8 of European Convention on Human Rights.
The ruling mounts pressure the UK government to change its current system of criminal records disclosure, so that offences by children are treated differently to offences by adults, in order to avoid situations where a formal caution given to a child for a minor offence, ends-up in a criminal record that stigmatises them for life.
U.K. pension contributions rise again in April
From April 2019, the amount that employees and their employers pay into workplace pension scheme will rise in line with UK legislation.
Under ‘auto-enrolment’ rules, the minimum employee contribution will rise from 3% to 5% while, employer contributions will increase from 2% to 3%.
The rise will affect up to 10 million employees who have been automatically enrolled into a pension scheme, by their employer, over the past few years.
Although all eligible employees are automatically enrolled into their workplace scheme, they can choose to opt-out of the scheme if they wish but only after they have been enrolled in it, by their employer, in the first place.
From April 2019, an employee over the age of 22, earning £45,000 per annum will have to contribute a minimum of £624 extra per year via their pay packet while their employer will have contribute an additional £390 per annum.
In this scenario, the total combined employer and employee contributions into the employee’s pension pot will total £2,727 per annum, an increase of just over £1,000 compared to 2018.
Workers will first notice these increases in their April pay packet and while the increase will be good news for workers in their later life, there is some nervousness in the industry that ‘jam tomorrow’ may be less well received by employees and that the employee ‘opt-out’ rates could rise as the year progresses.
However, some industry believe that the simultaneous increase in the amount which workers can earn before income tax is applied, will soften the noticeability of the increased pension contribution in workers pay packets.
Statutory Maternity, Paternity and Sick Pay increases
The new UK Tax Year starts on April 6th 2019 and from that date, the statutory sums covering maternity, paternity and sick leave will increase.
Statutory maternity and paternity pay will rise from £145.18 to £148.68 per week while statutory sick pay will increase from £116.00 to £118.00 per week.
The personal tax allowance threshold – the amount of pay which an employee can earn before income tax is applied – will rise to £12,500 from April 2019 – up from its current level of £11,850.
At the same time, the higher rate personal threshold – the point at which an employee’s income tax rises from 20 to 40 per cent – will increase from £46,350 to £50,000 at the same time.
However, with employee pension contribution levels increasing simultaneously, the net effect on an employee earning £45,000 a year, will be more or less neutral.
France overhauls special visa for tech talent
The French government has unveiled a complete overhaul of the French Tech Visa for Employees working in the tech sector, by making it easier to for non-French nationals and non-EU nationals to work in France.
According to French Tech Mission, there are more than 10,000 start-ups in France that meet the requirements to access the French Tech Visa Scheme, and the revised scheme will enable them to hire non-French or non-EU employees more readily.
It appears that the policy shift is due to supply v. demand where the former is currently not keeping pace with the latter.
Almost all of the high-growth start-ups who were consulted on the plan, said that hiring was their top priority and that some of the specialist skills they require are not readily available in France at present.
Unlike many countries who issue work visas to foreign passport holders, in France employers are not required to firstly prove that they have tried but failed to find suitable candidates in-country.
The previous iteration of the tech visa programme was limited to only ~ 100 companies, selected as part of the Pass French Tech programme and employees had to hold at least a master’s degree.
The new scheme does not require the same level of academic accreditation and and bears a relatively low processing fee of €368.
The tech visas are valid for 4 years and are renewable beyond that. In addition, visa holders are not bound to work for the same company for the duration of their visa.
Also, if the recruiting start-up business has raised VC fund capital or has received state funding or has JEI status, then they qualify for the scheme.