Employment

Equal pay in sport: an achievable goal or an impossible dream?
10 October, 2017

Why do women not receive equal pay compared to men in all walks of life? Elite sport seems decades behind the ‘normal’ working world when it comes to equal pay.

An argument often made against equal pay in elite sport is that male  athletes should receive greater pay because men’s sport is more popular, brings in more advertising, ticket sales, TV deals, and in some sports the men’s matches/events are far longer.

However, although I accept it may not be the strongest parallel, as shown in the recent case concerning Asda, in the ‘normal’ working environment it has been established that despite different genders and different roles, women are entitled to equal pay.

Soccer

Back in 2016 five senior female US international footballers filed a claim against their national federation for wage discrimination.

At the time it was reported that they earnt 60% less than their male equivalents, this was despite the rather interesting statistic that the US women’s team generated $20 million more revenue than the US men’s team that year.

This appears a genuine challenge to the argument that the male game is more popular in the US and generates greater revenue!

Earlier this year as part of on-going collective bargaining negotiations it was agreed the US women’s compensation and benefits package would receive a substantial increase, although still not to the level of their male counterparts.

Football

In Norway even greater steps towards equality have been taken. In a claimed first, Norway’s male and female players shall receive the same pay for representing their country.

It is understood that the Norwegian men’s team agreed to take a pay-cut as part of a new pay structure to accommodate equal pay to for the women’s and men’s teams.

Before the change in pay structure, despite being more successful in their respective international competitions the women’s team received less than half that of the men.

This is definitely a positive step towards equal pay in elite sport.

Long Way To Go For Equal Pay

However, it is misleading to think there is anything but a long way to go before equal pay across the sexes in elite sport. There are multiple examples of where inequality remains.

For example, in tennis despite all four grand slams offering the same prize money, not all tournaments do so and the sport’s male stars continue to earn more prize money and receive greater endorsements.

Also, the wages paid by professional football clubs (rather than by national governing bodies, as in the Norway example above) to male players and the value of personal endorsement contracts dwarf those of the female professionals.

The plight of the Notts County Ladies’ team highlights the disparity in fortunes and arguably shows the practical difficulties of ensuring equal pay for professional sportswomen.

Two days before the start of the 2017 season the team folded when it was projected that the costs in running the team for the season would be around £500,000 when the anticipated income revenue from ticket sales and sponsorship would only be around £28,000.    

If you require any employment law advice, please feel free to contact Chris Hovenden on 01732 224 166 or chris.hovenden@cripps.co.uk                                 


Budget airlines – currently encountering turbulence
5 October, 2017

Employees in the budget airline industry have suffered a bumpy ridewhite airplane in recent weeks after Monarch’s recent collapse left nearly 2,000 staff redundant, while Ryanair staff are publicly voicing complaints about opaque employment structures and unsatisfactory working conditions. In tackling cost pressures within the industry, what has been the impact on employees and how does their treatment affect the employer’s reputation and brand?

Monarch Airlines goes into administration

Following the AirBerlin and Alitalia insolvencies this summer, Monarch Airlines has become the most recent budget airline to collapse. On 2 October, 1,858 of the 2,100 staff employed by Monarch were immediately made redundant after the company went into administration. It is also reported that the administrators, KPMG, instructed some staff to call a premium-rate phone line to hear news of their redundancy, but have since promised to reimburse the costs of these calls.

The Unite union has now launched legal proceedings on behalf of the Monarch staff for the failure to comply with collective redundancy consultancy requirements, under which the administrators should have started consultation about the proposed redundancies at least 45 days before the redundancies were announced. These claims could result in compensation of up to 90 days’ pay for each employee, and a bill for the tax-payer running into millions.

Crises at Ryanair

Meanwhile at Ryanair pilots have demanded improved pay and employment terms under direct employment contracts with the company, and are reported to have formed an unofficial trade union to support their campaign. This dispute continues alongside the recent “mess-up” in how Ryanair rosters time off for its pilots, resulting in the company cancelling thousands of flights up until March 2018. The pilots rejected the company’s recent offer of bonus payments to forfeit their holidays and instead renewed their demands for full employment contracts. Interesting times lie ahead as the disputes between Ryanair and its pilots look set to escalate.

There have also been reports this week of lengthy HMRC investigations into the sophisticated indirect employment structures which Ryanair currently imposes upon its pilots, and which have landed them in substantial liabilities for underpaid tax. On joining Ryanair, pilots are required to set up a limited company in Ireland under the supervision of the company’s accountants. Pilots become directors of the newly formed company which supplies the pilots to agencies, who then supply them to Ryanair.

Food for thought

There are lessons for all employers to learn from these situations, ranging from how redundancy processes are managed, through the legal risks around complex and potentially bogus self-employment relationships, to the practical challenges in balancing holiday leave entitlements and arrangements against business needs.


Another nail in the gig economy coffin
28 September, 2017

Companies operating within the gig economy, specifically those providing minicab services, will now be forced to examine whether staff previously treated as “self-employed” are in fact “workers” and therefore entitled to greater level of employment rights.

An Employment Tribunal has found that three drivers of the London based minicab firm, Addison Lee, should be classified as workers rather than self-employed and so are entitled to the national minimum wage and holiday pay.

Facts

There was clear evidence that Addison Lee exercised day to day control over the drivers. Drivers had to adhere to procedures and systems put in place by Addison Lee, including a dress code and a code of practice that required drivers to ask customers if they had a preferred route.

Only one driver of approximately 4,000 in London drove his own car. All other drivers signed a driver contract and vehicle hire agreement for Addison Lee liveried Ford Galaxy cars – the costs of which typically took 25 – 30 hours work a week to pay off.

Whilst drivers were allowed to use the hired vehicles for private purposes, their use was monitored, restricted and regulated. Drivers ‘logged on’ to the company’s booking system when they were free and able to work, their location was tracked and jobs were sent to them. If drivers chose to decline a job, they would have to provide an acceptable reason.

The company argued that drivers were free to choose where and how they obtained a car and argued that drivers could elect to work when they wanted by choosing when to ‘log in’.

Legal argument

It was held that there was an overarching contract implied by the relationship between drivers and the company. The company expected and relied on drivers to log on, whilst the drivers had to log on to pay their fixed costs and earn an income. A contract of employment was formed as soon as a driver ‘logged on’ and began driving. The fact that drivers had to choose to log on did not diminish the drivers’ obligations under the contract.

Lessons to be learned

The gig economy now faces testing legal questions which will no doubt impact on a company’s management model. Going forward, there will no doubt be a rise in “self-employed” drivers seeking to establish their rights as “workers”; companies will need to carefully consider their contractual agreements so that workers rights are accurately reflected. Yesterday, Uber began its appeal against an employment tribunal decision made last year that the company’s drivers were workers. Regardless of Uber’s recent assertions that it is not part of the gig economy, the impact of the Addison Lee case will undoubtedly undermine Uber’s appeal against the tribunal’s decision.


Background checks and damage limitation – lessons to be learned from the Sampson saga
21 September, 2017

What would you do if you discovered an employee isn’t legally prevented from carrying out their role but their previous actions don’t sit well with your values?

Allegations

Mark Sampson, the now former manager of the England Women’s  football team, and the FA have barely been out of the news in the last month.

It all started when Eni Aluko raised serious allegations including accusations of racism. Following an investigation and the signing of a settlement agreement with Aluko, the FA and Sampson may have thought the matter had disappeared. However, the matter found its way into the public domain and the FA has been under substantial pressure to investigate the matter further.

>>> When settlement isn’t settlement

Sampson had received a fair amount of support from several team members and the FA had appeared to be backing him. This all changed very quickly. Why?

Previous Conduct

Reportedly, last week the FA was recommended to re-examine a report from 2015, by its own safeguarding panel, into Sampson’s relationships with players at Bristol (where he coached the 16-19 year old academy players and the women’s first team).

Despite no accusation of illegal activity and the above report finding Sampson was free to continue working in football (suggesting no safeguarding issue), the FA have made the decision to terminate Sampson’s employment.

Martin Glenn, CEO of the FA, stated that the decision was not influenced by or related to the previous allegations by Aluko and others.

>>> Settlement agreements – 5 things you need to know

Further, Glenn has said he should have looked into the report in more detail when he was first informed of it in October 2015 (but had not done so because it was a confidential report), suggested had he been aware of its full details he would have looked into it more carefully, and such previous conduct was not suitable for an employee of the FA.

Issues raised by the Sampson saga

This matter raises a multitude of interesting issues, including:

Background checks

  • How much investigation/background checks should an employer do before recruiting an individual, especially if it is a high-profile position?
  • Realistically, how much relevant information could you receive from a former employer?
  • As an employer you should be cautious about revealing details of conduct/disciplinary issues about former employees – it could leave you open to claims from the former employee.

How to respond?

  • An employee has not broken the law and is not prevented from carrying out their duties, but doesn’t fit your values. How do you respond? Is this impacted by how successful they are in the role? How does this apply in the care industry and the teaching profession?

Termination

  • It is understood that the remainder of Sampson’s fixed term contract up to 2019 has been paid out. His contract may have permitted for such early termination and, even if it didn’t, by paying out the remainder of the agreement the FA mitigated Sampson’s potential claim for damages for loss of earnings during the remainder of the contract (a wrongful dismissal claim). Separately, since he has two years’ service, Sampson could also have a claim for unfair dismissal on the basis a fair process was not followed and/or the reason for dismissal was unfair. In any event, it is likely Sampson has entered into a settlement agreement.
  • If Sampson had been employed for less than 2 years (i.e. without unfair dismissal protection) and on an indefinite contract it is likely he would have been terminated simply on notice.

Other investigations and publicity

  • If an employee is terminated, would you continue to investigate other outstanding serious allegations which question internal policies and processes?
  • The matter highlights the levels of negative publicity an employer’s decisions can attract.

Please get in touch if you have any queries regarding background checks, disciplinary processes, or terminations.

chris.hovenden@cripps.co.uk and 01732 224 166


Equal pay for equal work: different gender, different job, different pay?
4 September, 2017

Do not make the mistake of assuming that men and women carrying out different jobs are not entitled to equal pay.

You can almost see how it happens.

You have staff, let’s just say, working in the distribution centers of a major supermarket chain that earn X, whilst you have other staff employed to work in the retail/public-facing part of your business who receive less than X.

How can employers address pay imbalance

As an employer you mistakenly feel there are no issues with this as the roles appear substantially different. However, on closer inspection it becomes apparent that the majority of employees carrying out the less well payed job are female, and as a result you find yourself the subject of an ‘equal pay’ claim…. or more accurately in the case Asda an ‘equal pay’ claim from north of 7,000 current and former employees.

The EAT has dismissed Asda’s appeal and upheld the Employment Tribunal’s decision that female employees working in the company’s retail sites (of which there are around 630 across the country) can compare their work to that of the higher paid male employees that work in Asda’s 24 distribution centers.

Gender Pay Reporting – what employers need to know

The crucial factors considered in this matter were:

  • Is there a ‘single source’? The question is not whether the different groups of employees work for a single employer or even associated employers, rather it is whether the employees’ terms and conditions are governed by a ‘single source’ (i.e. a single body) which is responsible for, and has the ability to rectify, the alleged inequality. In this instance Asda’s Executive Board was found to be such a ‘single source.’
  • Did the employees have common terms? Although there were differences between the terms, broadly the terms of employment were the same (same employer and similar handbooks etc.) and supported a comparison between retail and distribution.
  • Was the work undertaken by the two parts of the workforce of ‘equal value’? The EAT agreed with the Employment Tribunal that the work of the two sections of the workforce was equal and, therefore, the pay of the women in the retail sectors should be comparable with the men in distribution.

The repercussions of the EAT’s decision for Asda are substantial (reportedly an estimated cost of up to £100m) and Asda has indicated it might continue its challenge to the Court of Appeal.

As an employer it is important to avoid falling into the trap of not considering the type of work and pay across different divisions. Please get in touch if you have any queries regarding equal pay.

chris.hovenden@cripps.co.uk and 01732 224 166


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