1. Esther Martin Anna Birtwistle Susanne Foster Bettina Bender CM Murray LLP 08 February 2011 Employment Law – Hot Topics CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

2. The Equality Act 2010 ______________________ Esther Martin CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

3. Protected Characteristics Age Disability Gender reassignment Marriage and civil partnership Race Religion or philosophical belief Sex Sexual orientation Pregnancy and maternity CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

4. Direct Discrimination A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others. s13(1) Perception Association CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

5. Indirect Discrimination A person (A) discriminates against another (B) if A applies a provision, criterion or practice which is discriminatory in relation to a relevant protected characteristic of Bs. s19(1) Includes disability / gender reassignment PCP puts, or would put … at a particular disadvantage s19(2) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

6. Harassment An employer (A) must not, in relation to employment by A, harass a person (B) – (a) who is an employee of As; (b) who has applied to A for employment. s40 Harassment must be related to a protected characteristic, but not necessarily that of the victim Third party harassment CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

7. Victimisation A person (A) victimises another person (B) if A subjects B to a detriment because: (a) B does a protected act, or (b) A believes that B has done, or may do, a protected act. s27 No comparator required CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

8. Pay secrecy clauses Clauses designed to prohibit or restrict relevant pay disclosures are unenforceable… …if the discussion about pay is with a view to finding out whether there is a connection between pay and having (or not having) a protected characteristic. s77 CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

9. Disability Discrimination Discrimination arising from a disability (1)A person (A) discriminates against a disabled person (B) if – (a)A treats B unfavourably because of something arising in consequence of Bs disability, and (b)A cannot show that the treatment is a proportionate means of achieving a legitimate aim (2)Subsection (1) does not apply if A shows that A did not know, and could not reasonably have been expected to know, that B had the disability. s15 No comparator required CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

10. Pre-employment health questionnaires A potential employer must not ask about the health of an applicant before offering work s60 Burden of proof reversed if a disability discrimination claim is lodged Conditional offer can still be made Exceptions CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

11. Exceptions – when discrimination may be lawful Occupational Requirement Schedule 9 General Positive Action S158 Disability / Pregnancy / Age s13(3)/ S13(6)(b)/ Schedule 9 CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

12. Sections not yet in force Combined Discrimination s14 Gender Pay Gap Information s78 Positive Action (recruitment and promotion) s159 CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

13. Practical considerations for employers Ensure all appropriate personnel are trained on relevant changes in discrimination law regarding employees, potential employees and ex- employees Audit standard employee documentation where necessary (e.g. contracts, staff handbooks, compromise agreements) Review policies (e.g. diversity, equal opportunities, anti-bullying and harassment) Ensure effective complaints procedures are in place CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

14. Default Retirement Age ______________________ Anna Birtwistle CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

15. Default Retirement Age WHAT IS CHANGING? Employers will no longer be able to use the DRA of 65 to maintain a compulsory retirement policy for their workforce: Up to 6 April 2011: Transitional arrangements From 6 April 2011: No new notifications of retirement on basis of DRA to be issued 1 October 2011: DRA and statutory duty to consider retirement procedures will be abolished WHAT ISNT CHANGING? Objective justification: Employers may still operate a compulsory retirement age except that from April 2011 they will need to objectively justify it (as they have up to now for retirement ages below 65) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

16. Option 1: Having a Compulsory Retirement Age 1.Legitimate aim -Workforce planning/succession -Facilitating the recruitment and retention of younger employees -Collegiality -Increased costs e.g. pensions and benefits (Seldon v Clarkson, Wright & Jakes and another) 2.Proportionate - Balancing act - Why that cut off point? - Criterion other than age? - Consistency? - Evidence CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law European Cases (Wolf, Peterson, Rosenbladt) v UK Cases (Martin, Hampton, Baker)

17. Option 2: Removing the Compulsory Retirement Age Follow a fair procedure and rely on one of the 5 other potentially fair reasons for dismissal: –Conduct –Capability/Qualifications –Redundancy –Statutory restriction –Some Other Substantial Reason Change in corporate culture Adequate Performance Procedures Using appraisal process to discuss future plans Recruitment CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

18. Next Steps/Issues to Consider Option 1: Retaining an EJRA Document how the Company has come to its decision Identify business needs and legitimate aim Compile evidence to show why that age has been decided upon and why other criterion cannot be used Consultation Exercise? Option 2: No Retirement Age Adequate Performance Procedures and appraisals in place Consider flexible working arrangements Ensure line managers know how to deal with long term sickness absence CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law For all companies: Amendments to contracts of employment, staff handbook, pensions and share schemes (good leaver/bad leaver status) Training Requirements Provision of benefits

19. Team Moves ______________________ Susanne Foster CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

20. Team Moves What is a team move? Why are team moves of concern? CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

21. Key Points Breach of express and implied contractual terms (e.g. no involvement in any other business, avoiding any conflict of interest etc) Directors, certain senior employees and partners are fiduciaries to their employer/firm – very high standard applies Substantial liability for breach of fiduciary duties – account for profits etc Risk of liability for new employer (and recruiters) when facilitating a team move CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

22. Duties whilst a Director, Senior Employee or Partner Duties of loyalty and good faith (implied and express) Essentially the duty is to place your employers or firms interests before your own, including –not to place oneself in position of conflict with co/firm –not to make secret profit from your position –render full information of all commercial opportunities and threats to business (including own misconduct) –accountable to company/firm for any benefit received –not compete, and if so, account for all profits CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

23. Key Challenges Confidential information Speaking to clients/customers about move Speaking to staff about move Diverting business opportunities Duty to tell employer about material changes CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

24. Garden Leave What is garden leave? Can be more effective than restrictive covenants Excluded from the office/market Prevented from speaking to clients/colleagues Additional restrictions e.g. re announcements Generally requires express provision, subject to reasonableness CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

25. Restrictive Covenants To protect legitimate business interests (e.g. trade connections and stability of workforce etc) Non-competition Non-solicit (customers, suppliers and staff etc) Non-dealing (customers and suppliers etc) Typically 3 – 12 months in employment context; 1 – 2 years in partnerships (separate body of case law in partnership context) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

26. Breach of Duties/Restrictions Rights, powers and remedies for (old) employer or firm, could include: summary dismissal or lock out of market by placing team move individuals on garden leave injunctive relief compensation full account to firm of profits unlawfully earned as a result of breach of fiduciary duties CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

27. Liability for New Employer Procuring and inducing breach of contract Conspiracy and/or unlawful interference with business or breach of confidence Account as potential trustee (fiduciary) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

28. City Employee Team Moves UBS Wealth Management (UK) Ltd v Vestra (2008) - 75 employees defected from UBS to Vestra, effectively stripping UBS of key desks and personnel -UBS alleged defections were orchestrated by a former senior UBS manager and senior managers still employed at UBS -UBS applied for springboard injunction, pending full trial, to prevent Vestra from taking an unfair advantage of alleged breaches by former UBS staff Held: Court granted UBS request for injunction pending trial, prohibiting inc: Vestra from soliciting any existing employee to leave UBS; Vestra from encouraging any client to transfer business; and Former UBS employees from servicing transferred UBS clients in breach of restrictions CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

29. UBS Wealth Management (UK) Ltd v Vestra (2008) (contd) -inherently unlikely on evidence available that poaching raid coordinated solely by former manager, without breach of contract by senior managers -Senior managers should have disclosed the planned poaching raids to UBS (especially as party to them in breach of duties of loyalty and fidelity) -Former manager was entitled to start up a new business, recruit former colleagues and attract former clients of UBS (once restrictions expired), -but was not permitted to encourage UBS senior employees to recruit others from UBS (this was unlawful conspiracy) -It did not matter that UBS employees may have left UBS in any event secret plotting to go together en masse was objectionable as unlawful CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

30. Other cases Tullett Prebon Plc and Ors V BGC Brokers LP and Ors (2010) Lonmar Global Risks Limited v West and Ors (2010) City Employee Team Moves (contd) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

31. Team Moves Hard to do without risk of breaches & liability particularly for the team but also the new employer Typical issues: –Requests to disclose confidential client/business information –Speaking to colleagues –Speaking to clients and customers –Risk of procuring and inducing if new employer (or recruiter) encourage breaches CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

32. Strategies & Tactics to seek to reduce risk if taking on a Team Advise team members to comply with duties and obligations Focus on lead team member and team/client loyalty If transfer must be as a team from the outset, keep team as small and as tight as possible Involve recruitment consultants: 1)to conduct and evidence research of team members and clients; and 2)approach and interview team members without lead team members input or involvement Consider length of notice, garden leave & restrictive covenants CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

33. Consider existing business financial resources to service clients/customers Consider handling of previous team moves – exits and arrivals Ensure recruitment/appointment is not subject to team transfer Use of PR – new employer not usually restricted; but individual team members may be Remember that all documents and emails etc are disclosable unless privileged CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law Strategies & Tactics to seek to reduce risk if taking on a Team

34. Family Friendly Rights ______________________ Anna Birtwistle CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

35. Key Changes to Family Friendly Rights Paternity Leave Extension to the Right to Request Flexible Working CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

36. Maternity leave OML: 26 weeks AML: 26 weeks Statutory Maternity Pay for 39 weeks: 1st six weeks paid at earnings related rate (90% of her average earnings) Remaining 33 weeks paid at prescribed rate (currently £124.88, from April 2011 £128.73) Ordinary Paternity Leave: Since 2003 eligible fathers have been entitled to up to two consecutive weeks paternity leave and pay Statutory Paternity Pay: lesser of the prescribed rate and 90% of the employees weekly earnings Additional Paternity Leave Current Regime CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

37. Additional Paternity Leave Regulations 2010 Applies to babies born/adopted on or after 3 April 2011 Mother must have returned to work without using up all of her OML/AML The earliest APL can be taken is 20 weeks from the date of birth/date of adoption Minimum 2 weeks up to a maximum of 26 weeks Eligibility requirements Additional Statutory Paternity Pay CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

38. How this works in practice… 30 weeks 22 weeks 9 weeks Total leave: 52 weeks Total statutory pay: 39 weeks CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

39. Practicalities Eligibility requirements Timing and notice Evidence of entitlement Effect on contract of employment Things to consider: –KIT days –Pension Contributions –Enhanced company schemes What next? CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

40. Flexible Working 2003: Right to request introduced and applied to carers of children under 6 2009: Right was extended to apply to children up to and including the age 16 Whats changing? From April 2011 this right will be extended to parents of children up to and including the age of 18 What next? Coalition government has stated intention to extend the right to request to all employees regardless of whether they have children CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

41. Right to request: It does NOT create a right to work flexibly! Typical requests Who can make a request –Mother, father, adoptive parent, guardian, foster parent and spouse, civil partner or partner of the same –Adult carers –Employees only –No request in preceding 12 months The Right to Request CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

42. Statutory Procedure Request procedure –28 days –14 days Right to be accompanied 8 Grounds of refusal: –Burden of additional costs –Detrimental effect on ability to meet customer demand –Inability to reorganise work amongst existing staff –Inability to recruit additional staff –Detrimental impact upon performance –Insufficiency of work during periods employee proposes to work –Planned structural changes Recourse to ET limited –Failure to correct procedure –Refusal outside of 8 statutory grounds –Rejection based on incorrect facts –Compensation: 8 weeks pay CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

43. The Agency Workers Regulations 2010 ____________________ Esther Martin CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

44. THE AGENCY WORKERS REGULATIONS 2010 European Legislation: Temporary Agency Workers Directive 2008/104/EC Due to come into force 1 October 2011 Coalition has confirmed no further amendments will be made CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

45. Who will the regulations apply to? workers with a contract of employment or employment relationship with a temporary work agency who are assigned to user undertakings to work temporarily under their supervision and direction Article 1.1 – Temporary Agency Workers Directive CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

46. Twelve week qualifying period To complete the qualifying period the agency worker must work in the same role with the same hirer for 12 continuous calendar weeks, during one or more assignments. Regulation 7(2) Continuity can be broken or suspended in certain specific circumstances CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

47. Anti-avoidance provisions The Regulations contain a non-exhaustive list of factors to be taken into account in determining whether a structure of assignments is intended to deprive the agency worker of rights. Regulation 9(5) Additional award of up to £5,000 where a hirer and/or agency are found to have breached the anti-avoidance provisions. Regulation 18(14) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

48. Agency Worker Rights An agency worker (A) is entitled to: … the same basic working and employment conditions as A would have been entitled to for doing the same job had A been recruited by the hirer – (a)Other than by using the services of a temporary work agency; and (b)At the time the qualifying period commenced. Regulation 5(1) CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

49. Regulations only apply to basic working and employment conditions oPay oDuration of working time oLength of night work oRest periods oRest breaks oAnnual leave Comparator required Terms must be ordinarily included CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

50. Pregnant women and nursing mothers Subject to the 12 week qualifying period Agency workers are entitled to: – reasonable time off during working hours to attend ante-natal appointments –payment from employment agency during her absence She may lodge a tribunal claim if a request is unreasonably refused Duty to make reasonable adjustments on hirers CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

51. Access to employment, facilities and training No twelve-week qualifying period Failure to provide access to on-site facilities can be justified on objective grounds Regulation 12(2) No further provisions required in relation to access to training. CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

52. Suggestions for agencies and hirers Useful questions: 1.Is the worker a temp from an agency? 2.Have they ever worked for you (or a connected business) previously? 3.Are they likely to qualify for equal treatment? 4.What should they be paid and what working time arrangements should be in place? 5.What else will have to be offered? CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

53. The Bribery Act ______________________ Anna Birtwistle CM Murray LLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

54. The Bribery Act Comes into force April 2011 UNKNOWN (3 months from final guidance being published) Government guidance still awaited CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

55. Offences General Offences: 1.Paying bribes (Active bribery) 2.Receiving bribes (Passive bribery) Specific Offences: 3.Bribery of foreign public officials 4.Failure of commercial organisation to prevent bribery: the Corporate offence CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

56. The Corporate Offence Company/partnership will commit bribery if: An associated person bribes another person for that organisations benefit. Associated person: employees, agents, subsidiaries, intermediaries, joint venture partners, suppliers Strict liability offence Territorial reach Corporate hospitality Defence: Adequate procedures Key Differences with the US Foreign Corrupt Practices Act (FCPA): Facilitation Payments Defence illicit payment is lawful in the Country in which it was paid Bona Fide reasonable expenses CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

57. Adequate Procedures Defence Current draft guidance, six principles: 1.Risk Assessment 2.Top level commitment 3.Due diligence 4.Clear, Practical and Accessible Policies and Procedures 5.Effective implementation 6.Monitoring and review CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

58. Consequences Of Non-Compliance Criminal sanctions Fine Fines from sector regulators (e.g. FSA) Debarred from tendering for public- sector contracts Adverse publicity CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

59. Practical Tips Policies – anti-bribery, corporate hospitality and gifts Whistleblowing procedures to report bribery Training to relevant staff Assessment of risk Investigation procedures and disciplinary sanctions Appointing individual responsible for bribery issues CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

60. Clare Murray Managing Partner Bettina Bender Partner Charis Damiano Consultant Esther Martin Associate Anna Birtwistle Associate Susanne Foster Senior Associate The CM Murray LLP Team CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law

61. CM Murray LLP 37th Floor One Canada Square Canary Wharf London E14 5AA +44 (0)20 7718 0090 www.cm-murray.com info@cm-murray.com Twitter: @CMMurrayLLP CM Murray LLP: Specialists in Employment, Partnership and Business Immigration LawCM Murray LLP: Specialists in Employment and Partnership Law