The 2010 Budget and employment

We set out below how some of the headline announcements in this year’s budget may impact on employment law.

  • The 25% cut in public sector spending (excluding the NHS and foreign aid) will undoubtedly result in public sector redundancies.  This is also likely to see an increase in TUPE transfers, outsourcing and reorganisations, so that ‘front line’ jobs are protected as much as possible (albeit that the cuts may see an increase in ‘front line’ staff taking on back office functions). 
  • Plans are to be drawn up with the aim of implementing fairer pay across the public sector, without increasing the overall pay bill, so that those at the top of organisations are paid no more than 20 times the salaries of those at the bottom.
  • Two year public sector pay freeze on staff earning more than £21,000.
  • People earning less than £21,000 in the public sector will each receive a flat pay rise worth £250 in each of the two years.
  • The Government is to consult shortly on how it will “quickly phase out” the Default Retirement Age from April 2011.  The rise in the state pension age is also to be accelerated.
  • A review public sector pensions is to be implemented, ahead of the autumn spending review.
  • Changes to employer supported childcare schemes, which will take effect for new joiners to the schemes on or after 6 April 2011, have been confirmed.  New joiners to certain childcare and childcare voucher schemes will be entitled to a reduced amount of tax relief if they are higher or additional rate taxpayer employees.  Taxpayers who already participate in such schemes, as at 5 April 2011, and basic rate new joiners will continue to enjoy the existing levels of income tax and National Insurance contributions relief.

Equality Street

The Government Equalities Office has sparked some debate over the Government’s intentions in respect of the implementation of the Equality Act.  The Act received Royal Assent in April 2010, and the main provisions of the Act were expected to come into force in October 2010.  The implementation date of October 2010 was removed from the Equalities Office’s website last week, but they have now announced on their latest news page that they are continuing to work on the basis of the previously announced timetable of main commencement in October 2010.  But, they say that the Government is “currently considering how the different provisions will be commenced so that the Act is implemented in an effective and proportionate way.”  They add that they will provide further information on implementation plans “as it becomes available” – and we will keep you informed, but this does suggest that some tinkering with implementation of the Act may be afoot. 

Working nine to five (or six, or seven…?)

The Government has published Time for Training, a review of the impact of the full implementation of the European Working Time Directive (‘the WTD’) on the quality of training of Doctors, Dentists, Pharmacists and Healthcare Scientists in England. The report focuses on the training of doctors in hospitals, as the impact of the WTD on the other three professions covered was found to be negligible.  The report concludes that that high quality training can be achieved within the 48-hour maximum working week set out in the WTD, and that increased hours or longer programmes will not address any current problems in training. However, the report also states that training within the reduced hours will be unsuccessful if there is poor supervision and limited access to learning, and if trainees are involved in out-of-hours work.

Vetting and barring scheme on hold

In its Coalition Document, the Government promised it would “review the criminal records and vetting and barring regime and scale it back to common sense levels”.  In order to do this and remodel the scheme, the Government has announced that it is halting the phasing in of the Vetting and Barring Scheme (VBS).  The first phase of registration (voluntary registration with the VBS for new employees and job-movers working or volunteering with children and vulnerable adults) was due to commence on 26 July 2010, with compulsory registration due to follow in November 2010.  Both phases have now been postponed indefinitely, and we await confirmation of what shape the scheme will take when the review is complete.  In the meantime, the requirements which came into effect last October remain in force:

  • it is a criminal offence for barred individuals to apply to work with children or vulnerable adults in a wider range of posts than previously. Employers also face criminal sanctions for knowingly employing a barred individual across a wider range of work.
  • The three previous barring lists (POVA, POCA and List 99) are replaced by two new barred lists administered by the Independent Safeguarding Authority (ISA). These two lists can be checked as part of an Enhanced Criminal Records Bureau check
  • Additional jobs and voluntary positions are covered by the barring arrangements
  • Employers have a duty to refer to the ISA any information on an individual working with the vulnerable where they consider them to have caused harm or pose a risk.

For further information, you can telephone the VBS contact centre on 0300 123 1111.