Archive | August, 2013

CAT’S INSIDE LINE: BMW 3 SERIES (2005 ONWARDS)

CAT’S INSIDE LINE: BMW 3 SERIES (2005 ONWARDS)

BMW-3-Series_300pxCarrying on the Inside Line series, we move on from looking at a fleet favourite, the Ford Mondeo, and turn our attention to another model popular among company car owners, the BMW 3 Series.

The 3 Series, has been in strong demand for years and in 2005 the new E90 model was launched. It wasn’t just on the surface that the 3 Series experienced some changes, as the range gained a new 1.6l petrol engine to go with its 2.0l, 2.5l and 3.0l siblings, and the 2.0l and 3.0l diesels. There was also an upgrade for the powerful M3, which included a new 4.0l straight six petrol engine producing 414hp.

The later versions of the 3 Series included EfficientDynamics models, which included BMW’s stop-start system.

These new technologies that have appeared on the 3 Series will provide technicians with additional challenges, some of which we have outlined below.

Next month we’ll be looking at the Mini.

If you have expertise, knowledge and insight to share, we would be delighted to hear from you. It will make our Inside Lines feature an even more powerful tool for our workshop readership.
To get your advice included contact hemal.mistry@haymarket.com or peter.lawton@haymarket.com

Click below to see technical contributions on the BMW 3 Series from:

Cambiare – highlights the 3 Series’s weak points

Castrol – recapping why oil plays such an important part in the BMW engine

CES– a whole host of issues and instructions on how to solve them

Comma – discusses servicing and changes of fluids and oil in the 3 Series

Contitech – explaining how to test a v-ribbed belt on the BMW

First Line – analyse clutch and bearing issues and faults

Forté – how to solve troubling turbo issues

Manbat – advises on AGM battery replacements

Meyle – common suspension and oil pan faults sorted

Remy – avoid confusion alternators for the BMW 3 Series

RMI – outline a variety of 3 Series issues

TecRMI – give us an insight into a number of technical problems with the 3 Series

ZF Services – explain the issue with transmission fluids on automatic BMW 3 Series

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Independents to benefit from out of warranty cars

Independents to benefit from out of warranty cars

Suspension-checkTechnicians should be on the lookout for vehicles approaching 70,000 miles, according to a new report.

Over half of vehicles reaching the 60 or 70,000 mile point are destined to break down, says Warranty Direct in its new reliability survey. In particular, savvy garages should be watching out for Toyota models, which take the longest time to repair with an average labour time of 2.81 hours.

At the other end of the scale, Fiat models could be a very quick repair, taking on average just 1.5 hours.

Warranty Direct’s research into 50,000 current policies on its books found that the failure rate on vehicles over the 70,000 mile mark was around 50.7 percent.

The data indicates that the most common problems that technicians will face are axle and suspension issues, which are responsible for just under 25 percent of repairs, and electrical faults accounting for 20 percent of jobs on these vehicles.

Duncan McClure-Fisher, Managing Director of Warranty Direct, said: “Even with the much-improved reliability of modern cars, mileage will take its toll on any vehicle and parts will naturally wear out.”

Warranty Direct’s findings also show the average cost for repairs is around £420, but insists that this could easily run into thousands of pounds once labour and parts are added.

McClure-Fisher added: “You shouldn’t expect a new car to break down in its first three years but there is a reason that manufacturers, for the most part, limit their warranties to three years or 60,000 miles.”

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INDEPENDENTS CAN BENEFIT FROM DEALERSHIP NEGLIGENCE

INDEPENDENTS CAN BENEFIT FROM DEALERSHIP NEGLIGENCE

Garage-work_smallFranchised dealerships are presenting the independent aftermarket with a golden opportunity, according to research by BTC.

The findings from the automotive training and consultancy firm shows that dealerships miss out on 57 percent of servicing work, which is costing them an average of £35.45 revenue per job.

The sample of 1,000 franchised dealerships show that those vehicles that registered a red or amber warning during the electronic vehicle health check were being ignored. This gives independents and rapid fits a large opportunity to benefit from the negligence of service departments and its unsatisfied customers.

Data shows that from 1,120,114 vehicle checks throughout January to June this year, a number of vehicles received a red warning, and in urgent need of servicing were not being repaired by dealerships. This means that £79,124 per year of urgent repair work is up for grabs for independents.

Meanwhile there was £89,702,200 of work needed doing to cars that registered an amber warning, which is likely to need work done in the near future. The data shows that only 17 percent of work was converted, leaving a large amount of work that could filter down into the independent aftermarket sector.

Guy Allman, Chief Executive at BTC, said: “Dealerships are letting too many sales slip away. What we regularly see is advisors struggling to sell red items because they have insufficient knowledge.

“A technician who understands a red item will be able to better communicate the risk to the customer and convince them the work is required urgently.

“Amber items should not be ignored as a sales opportunity. Identifying items with impending repair work to the customer is the most effective way to open up a channel of communication and build a relationship over time. This way, they will understand the value of having the work done at the time of the health check or that they are more likely to return when the repair work becomes more urgent.”

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Tyresafe campaign gains timely boost with Halfords

Tyre-safe-and-halfordsHalfords Autocentres has given tyre safety month a boost by becoming a member of the campaign.

Tyre charity TyreSafe announced that the chain of 290 centres will be offering a free tyre safety check throughout the month of October. This move will increase the visibility to consumers throughout the campaign.

Stuart Jackson, Chairman for TyreSafe, said: “It’s fantastic news to welcome Halfords Autocentres to the TyreSafe family and its membership couldn’t be better timed with tyre safety month almost upon us, which is shaping up to be our biggest and best yet.

“Motorists already had plenty of choice for a free tyre health check but with Halfords Autocentres also on board, car owners have every opportunity to make sure that their tyres are safe and legal.”

Halfords Autocentres will be joining full members including Bridgestone, Goodyear, Continental and KwikFit, to encourage drivers to check their tyre pressures, and ensure their tyres are not dangerously inflated.

Marketing Director for Halfords, Rory Carlin, added: ‘Vehicle safety has always been a driving ethos for our business and is achieved by providing access to expert technicians, trained to the highest industry standards, at an affordable price.

“That same commitment to safety applies to tyres, which is a growing part of our core business, so the decision to join TyreSafe was a natural extension for us. We are therefore delighted to be involved with tyre safe month and offering all car owners a free tyre health check at any Autocentre in the UK.”

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CAT’S EMPLOYMENT 101

CAT’S EMPLOYMENT 101

Employment_250px

Employing staff isn’t as easy as some may have you believe, there is a lot for employers to consider constantly.

From the recruitment process, through to dealing with wages and a tribunal dispute, it is a potential minefield. Plus in the independent sector the pressure is on further as time is limited and without necessarily having a dedicated HR team, things can often be forgotten or confusing.

That is why CAT have put together this hub of Employment Know How from some of our expert contributors who have touched on a range of topics that you will find helpful when tackling employment issues.

How to keep your HR happy

How to keep a lid on employees’ wages

How to take on your first ever employee

Are your business rates set at the right level?

How sickness affects annual leave entitlement

What to do about employment tribunals

Don’t panic, but get Real Time with PAYE

Common national minimum wage errors

Protect yourself from liquidation liabilities

Employing non-British staff – Getting it right

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Are your business rates set at the right level?

Louise-Hebborn3Louise Hebborn gives you an insight into the rules around business rates. If you know the ins and outs of it, you might be able to save some money.

Business rates, along with rent and employees, form a large part of the fixed costs that businesses and organisations have to pay irrespective of what they earn. While many at the top believe that a rates demand, once received, must be paid in full and without question, there are others who know that the system does have a little leeway built into it.

Rateable value

Business rates are a tax on property and all business premises are given a rateable value by the Valuation Office Agency (VOA) in England and Wales.

The basic rateable value usually remains fixed for a five-year period. The rateable values that became effective on April 1, 2010 were based on open market rental values on April 1, 2008. The next revaluation comes into force on April 1, 2015.

The amount of business rates payable is calculated using the rateable value and a multiplier set by the government. This multiplier usually changes each year in line with inflation. Currently, the standard multiplier in England is 42.6p. There are reductions for businesses eligible for Small Business Rate Relief (SBRR), while businesses in the City of London should expect to pay a small surcharge on top of the standard multiplier.

Despite calls for rates to be frozen during such tough economic times, the government implemented an increase in April 2012 of 5.6 percent.

Challenge a valuation

Business rates can often be challenged through an official appeal process, however. There are three grounds to appeal:

  • The new valuation was wrong
  • The property has been changed and should be reflected in the rateable value; or
  • An alteration made to the valuation is wrong

There are various ways to challenge a rating and businesses should seek advice from a professional advisor including a solicitor, the Royal Institute of Chartered Surveyors, the Ratings Surveyors Association, the VOA or through another professional advisor including your accountant.

Businesses who want to challenge their rating themselves can contact the local VOA to state why they consider the valuation to be incorrect. It can also be done online at www.voa.gov.uk.

The VOA will acknowledge the appeal within ten working days and check if it’s valid. If it is, they may visit the property. If it is a material change, say, alterations have been made to the property or the use of the property has changed, a visit may not be required.

Plan B

There are various other ways to seek to lower liability. There have been instances of businesses shutting off floors of their premises to reduce their bill significantly; if part of the building is empty and not being used, it can qualify for rate relief.

Likewise, an empty property is exempt from paying rates for three months after it becomes vacant. If the premises are an industrial/warehouse building, it would gain a further three months relief.

If the building only has a rateable value of up to £12,000, 100 percent relief is available in 2012/13 and up to 50 percent in the subsequent years. Those with a rateable value from £12,000 to £17,999 can make use of SBRR mentioned previously.

Businesses that relocate to one of the new Enterprise Zones can take advantage of a 100 percent relief to their ratings bill for five years. There are 21 Enterprise Zones planned, with projects announced in Cheshire, Essex, Cornwall, Gosport, Hereford, Humber Estuary, Leeds, Sheffield, Birmingham, Bristol, Liverpool, London, Manchester, Derby, Nottingham, the Black Country, the Tees Valley, the West of England and the North East.

Rural businesses will also be eligible for relief, aimed at encouraging small businesses to remain open in more remote areas.

Time to pay

Businesses that are experiencing particular hardship should contact their local authority. They have the power to provide rate relief for struggling companies.

The government’s Business Rates Deferral Scheme helps businesses spread the increase in the current financial year’s bill across three years; it enables companies to reserve paying 3.2 percent of the current year’s bill or 60 percent of the retail price index rise until 2013/14 and 2014/15.

Road improvements, road closures and upgrades to transport infrastructure can sometimes be disruptive and restrict access for deliveries and customers. Under current law, there is no compensation available for loss of trade. But, for disruption over a sustained period, it may be possible to apply for a temporary reduction in the business rate, because the highway works may have affected the rental value of the premises over that period.

If a business is affected by local disruption, they can also contact their VOA directly to lodge an appeal to have the rateable value of the property temporarily reduced for the period of the works.

Find a solicitor:
www.lawsociety.org.uk
The Royal Institute of Chartered Surveyors:
www.rics.org
The Ratings Surveyors Association:
www.ratingsurveyorsassociation.org

More rates for merchants

Eight out of ten retailers are paying more than they need to on card processing charges.

The Card Processing Advisory Service (CPRAS) reckons it can save 80 percent of retailers’ money. CPRAS founder Graham Hallewell said: “The way merchant providers publicise their rates is not always clear and the charges firms pay for processing card payments can be complex and vary enormously.

“There are many contributing factors, so it is not easy to make informed choices between merchant providers. It has nothing to do with the industry they are in.”

Hallewell reckons that the differences in rates between companies in the same industry can vary by as much as 100 percent. He says the service was able to save electronic security equipment distributor Norbain SD more than £12,000 a year.  There is no fee for consultation if you’re already on the most competitive rate, or if a switch does not save at least 10 percent over current costs.

For more information on the service, call 0845 634 7871 or visit www.cpras.org.

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Common national minimum wage errors

JasonPiperDon’t let your workers slip below the minimum wage, says Jason Piper, it could cost you dear. Here are seven steps you can take to avoid mistakes

According to pay monitoring site Payscale, motor mechanics can earn as little as £9474 per year, while a parts advisor earns, at the lowest point, just £15,510. Considering that these numbers are the mid point of the salaries reported, the pay might actually be much worse. The Low Pay Commission has reported in the past that motor trades and retail are problem areas for them.

The National Minimum Wage (NMW) covers all employees, irrespective of job. It’s enforced by HMRC and in 2010/11 they identified almost £4 million in arrears, benefitting around 23,000 workers.

The NMW teams operate under the Police and Criminal Evidence Act and can visit at any time, without reason, to inspect wage records. Obstructing them is an offence, which carries a fine of up to £5000 and can lead to a criminal record. If you’ve deliberately underpaid, or tried to disguise underpayments, that’s a criminal offence too, again carrying a £5000 fine.

For underpaid NMW, you’ll have to pay the lost wages, as well as paying a penalty – half the underpayment, capped at £5000, or a quarter if you settle everything within 14 days of the notice. Ignoring it will lead to prosecution, but you can appeal.

HMRC has a list of the most common failures they come across:

1 Failure to record working time properly

Are workers required to arrive early or leave late? Do they carry out other work related activities outside normal working hours? If so, they must be paid the NMW for this additional time, as well as for their normal working hours. Even if this is something as simple as expecting the apprentice to sweep up and tidy away after their official hours have ended.

2 Apprentices

Since October 1, 2010 apprentices on a formal apprenticeship scheme or contract have been entitled to a NMW apprentice rate, currently £2.60. After a year and on reaching the age of 19, they should get at least the rate appropriate to their age. From April 2012, there’s a new type of apprenticeship, which is a ‘contract for services’ rather than a ‘contract of apprenticeship’. Bear in mind that whatever their age, employees on one of these contracts will qualify for the normal age related NMW, not the lower apprentice rate.

3 Birthdays

Do you record your employees’ birthdays? Is it linked to your payroll? NMW rates are based on the age of the employee, so if you miss someone’s 18th, 19th or 21st birthday it could mean you’re paying them the wrong wage.

4 Piece rates

You may pay your workers by their productivity. However if the worker is required to work fixed hours, and paid for what they make in that time, then they must receive at least the NMW for those fixed hours. That doesn’t mean you have to support workers who are unusually slow provided your piece rate allows an average worker to make 1.2 times NMW in an hour.

5 Accommodation

If you charge workers for accommodation, note that these charges are linked to the payment of NMW, even if the accommodation is not directly connected to the employment. You can offset some of the accommodation costs against NMW, but only £4.73 per day.

6 Deductions from pay

In most cases, the NMW is only worked out after any deductions an employer has made to cover things like uniform, tools, transport or purchases of goods and services. If you’re charging for extras, you’ll still need to ensure the remainder of the worker’s pay, after the deductions, meets the NMW for the hours they have worked.

7 Paying the wrong rates

Simply failing to update pay rates for the new levels is surprisingly common.

From October 1, 2011, workers over the age of 21 require a minimum hourly rate of £6.08. This will change to £6.19 on October 1, 2012. Workers between the ages of 18 and 20 are entitled to £4.98 and those under the age of 18, but beyond compulsory school attendance, must receive a minimum of £3.68 an hour.
For apprentices under 19 or in the first year of their apprenticeship the NWM rate is £2.60. This will change to £2.65 on October 1, 2012.

Further information

Direct.gov: http://bit.ly/EcWZC

Businesslink: http://bit.ly/IY86Dz

Pay and Work Rights Helpline: 0800 9172368

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Don’t panic, but get Real Time with PAYE

JasonPiperThe biggest change in PAYE since the end of World War II is coming and businesses need to be ready, says Jason Piper. Here’s what you need to do.

Businesses need to get up to speed with the soon to be compulsory Real Time Information (RTI) that will overhaul the way PAYE works in the UK.

Having been with us since 1944, PAYE was originally set up to aid collection of taxes during World War II. Changes in work patterns, payments and the sheer volume of information handled by the system have left it straining to cope, however.

So why change?

PAYE was designed to run on paper. Reconciling all the information by hand used to take months – many weeks even on computers – as there were over a dozen different systems around the country that couldn’t automatically cross-check each other.

What’s worse, as computers took over the processing of the information, tiny errors and inconsistencies that a human would have simply ignored or amended became a major stumbling block. Some taxpayers had multiple records.

HMRC now has a single computer able to process year end information in just two or three days, although the system needs faster information feed in and in a more consistent format.

Why now?

PAYE is a hugely important part of the UK tax system and the business environment. The process of implementing RTI has to be complete by October 2013 and the next PAYE year that businesses open will need to be RTI ready.

The reason for the rush is the overhaul of the benefits system and the introduction the Department of Work and Pensions (DWP) of the Universal Credit. Both need accurate detailed information about the tax and National Insurance position of every person in the country receiving any type of benefit. Universal Credit is due to go live in October 2013, so DWP need the systems feeding information in to them to be up and running by then.

What do I need to do?

If you use an outside specialist or bookkeeper to submit your returns you need to make sure they’re up to speed. Talk to them now about who is going to do what and when.

If you do your own payroll, then you’ll need to take care of things yourself. Software providers have been working closely alongside HMRC to try and work out what needs to change and what can be kept.

HMRC are upgrading their software (available free if you’ve nine or fewer employees) and software firms have been running pilot programs across the country with 300 employers from April this year. Another 1300 started in July, and up to 250,000 will join the party in November.

Perhaps the most important thing you can do is tidy your payroll data. Because the new system is totally computer driven, it will spit out any inconsistent information as being wrong; you shouldn’t be submitting records in the name of AN Other, or A Student anyway. At the very least, you’ll need the NI number, date of birth and full name for each employee. It’s worth bearing in mind that if you regularly get your RTI submissions returned, you’re likely to move up HMRC’s ‘at risk’ register for a PAYE visit. With monthly returns, HMRC will get a much quicker idea of whether you’re having problems than it did under the old annual system.

The system will want to know how many hours have been worked by each employee in the pay period. Of course this may not be a problem if everyone is on fixed hours, and paid well above the National Minimum Wage, but if you’ve got many part time workers on the payroll, you’ll need to look at how you capture that information and get it into the system.

On the plus side, the year end forms (P35, P14a and P38As) will no longer be needed, and you also won’t need to send P45s to HMRC or complete a P46. Employees will still need a P60, and expenses and benefits will still need to be reported on a P11D/P11(b), however.

It’s worth bearing in mind that it won’t just be your employees who lose out if their tax and NICs records are wrong. In 2011, HMRC introduced a controversial new set of ‘in year’ penalties for PAYE record-keeping failures. While there’s likely to be some sort of soft landing for issues relating to the RTI system, relying on that is a dangerous game to play. The new penalties can quickly run into thousands, and you’ll still have to spend the time sorting out your records after spending the cash on the penalty.

HMRC Real Time Information http://bit.ly/AuyF4E

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Employing non-British staff – Getting it right

AmirZaidiFailing to properly check that your workers have the right to work in the UK could land you with big fines or even a prison term, says Amir Zaidi

The recent allegation that ECP negligently employed illegal workers means it now faces fines of up to £10,000 for each case. For those companies which knowingly hire illegal workers, the risk is of an unlimited fine and/or a prison sentence of up to two years.

The Border Agency isn’t very forthcoming with information on how to properly identify lawful permission to work, or how to conduct checks and on best practice generally.

When faced with a migrant worker – anyone who is not British – it is important to work through simple steps to ensure the migrant’s permission to work in the UK.

Nationals of the European Economic Area and Switzerland are allowed to work in the UK without restriction. These are nationals of: Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Liechtenstein, Luxembourg, Malta, Netherlands, Norway, Portugal, Spain and Sweden.  From April 30, 2011, nationals of the following countries had their restrictions lifted: Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia.

It is crucial to note that only nationals, not residents, of the above countries have freedom to work in the UK. A Brazilian national who has a Portuguese residency card will not have permission to work in the UK – only a document conferring Portuguese nationality will suffice.

Nationals of Romania and Bulgaria (“A2” countries) are permitted to enter the UK, but they must not start working until authorised by the Border Agency.

If the employee is not from a country listed above, a different set of criteria apply which is based on accruing enough points to gain entitlement to work.

Since February 2008, the Border Agency has been given wide-ranging powers, and thousands of businesses have since been fined.

The Agency will typically attend a work premises in numbers and hold all persons on site, even customers. If illegal workers are identified, an employer is asked to produce the documents kept on file which show adequate checks were made. Fines arise where it can be shown that both the worker had no permission to work and that adequate checks were not carried out.

An employer will have a defence if the worker provides the employer with certain documents listed on the right. Employers must take reasonable steps to check the validity of documents, but are not expected to be experts in forgery. Reasonable steps could include rejecting any obviously defaced or altered documents, seeking corroborative evidence or calling the Border Agency.

Employers are expected to keep documents for at least two years after the employment terminates. They should also check photographs bear a resemblance to the worker and are consistent with any date of birth. Employers also need to take reasonable steps to check the employee is the rightful owner of the document, retain copies of the whole of any documents that are not passports or other travel documents and key pages of any passport or other travel document.

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How sickness affects annual leave entitlement

Mark_StevensWhat happens to the annual leave employees are accruing while on long-term sick leave? Mark Stevens unravels the holiday pay situation.

An employee cannot be unwell and take their annual leave at the same time. A European Court of Justice case (Asociación Nacional de Grandes Empresas de Distribución (ANGED) v Federación de Asociaciones Sindicales (FASGA), says so, concluding that an employee who is unwell during their annual leave can require their employer to reschedule their annual leave to a later date.

Sickness and annual leave

An employee also continues to accumulate statutory holiday during sickness absence, even if they are absent for the whole holiday year. This means that an employee who has exhausted their sick pay entitlement could request to take paid holiday during their sickness absence. It is generally agreed that employees who are not permitted to take their statutory holiday while they are on sick leave are allowed to carry holiday over to the next holiday year. But what happens in circumstances where an employee becomes sick before or during their annual leave?

The ANGED v FASGA case

A Spanish collective agreement did not allow for workers to postpone annual leave where it coincided with sick leave for general ill heath. The matter was eventually referred to the Court of Justice of the European Union (CJEU).

The CJEU held that EU law prohibits any national laws that do not allow workers to take the annual leave that coincides with a ‘period of unfitness’ at a later date. The CJEU emphasised that the right to paid annual leave was an important principle of EU law with no exemptions.

The CJEU said annual leave enables workers to enjoy a period of relaxation and leisure; sick leave enables workers to recover from an illness. It would go against the purpose of annual leave to allow a worker to reschedule a period of leave only if he was already unfit for work when the annual leave commenced.

The CJEU also held that the rescheduled period of annual leave may be taken outside the relevant holiday year if necessary.

Best practice

Employers will have to be flexible as UK courts and tribunals seek to interpret current UK legislation in a manner compatible with the CJEU’s decision.

With this in mind employers should have in place clear policies setting out the circumstances in which employees will be entitled to reschedule annual leave.

There should also be a requirement that the usual notification and evidence requirements are met by any employee who claims to be sick in whatever circumstances. An employee may be inclined to ‘take advantage’ of the opportunity to reschedule holiday if they are only required to telephone their employer first thing in the morning on their day off in order to confirm that they would prefer to take that day off as sick leave.

Employers would also be wise to have a policy that an employee may only reschedule their statutory holiday entitlement. A full-time employee is entitled to a minimum of 5.6 weeks leave per year. Some employers may offer more than the minimum level of holiday entitlement and, if so, the annual leave policy should make clear that the opportunity to reschedule holiday will only apply to the statutory element of their holiday entitlement, which for a full-time employee would be the first 28 days, pro-rated for part-time workers.

Consequences

The UK courts and tribunals are yet to hear a case from an employee arguing that they were not allowed to reschedule holiday because of sickness. It is likely that where a complaint is well-founded, the tribunal will make a declaration to that effect and may make an award of such compensation that is fair in all the circumstances, having regard to the employer’s failure and any loss sustained by the employee as a result.

Employees could also potentially pursue a claim in an employment tribunal if they suffer a detriment as a result of asking their employer to reschedule their holiday as a result of sickness. An employer should bear this in mind when considering its employee’s request and ensure that it avoids treating the employee differently in the future as a result.

Employers are often frustrated by the ins and outs of employment law, but there’s really no excuse for getting on top of what’s required and making sure you don’t get hauled in front of a tribunal.

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