Tag Archive | "wright hassall"

DOES THE AFTERMARKET HAVE A PROBLEM WITH OVERTIME?

Tags: , ,

DOES THE AFTERMARKET HAVE A PROBLEM WITH OVERTIME?


By Tina Chander – partner and head of the Employment team at leading Midlands law firm Wright Hassall

The issue of working late can be a sensitive one within many businesses, as the line between flexibility and unhealthy overtime becomes increasingly blurred.

Most people don’t mind staying late occasionally if there’s a vital piece of deadline-dependent work that still needs to be completed, and this is commonplace for organisations across a range of sectors.

However, when unpaid overtime is pushed to unreasonable lengths and negatively impacts personal time and sociable hours, it can have significant implications on employees’ work-life balance.

In 2017/2018 over 600 employers were ‘named and shamed’ as having failed to make payments in accordance with the National Minimum Wage (NMW).

On the clock

Usually, the term overtime means staying behind past contracted hours.

However, this isn’t always the case, as employees who work through their lunchbreak or get to work much earlier than their colleagues are also classed as working overtime.

One of the biggest reasons for salaried staff working later hours is workplace culture, where people fear criticism if they leave on time.

It is important for employers to ensure their contracts give all staff clear guidance on what is expected with regards their working hours – clear parameters will prevent any grey areas becoming more complicated issues later down the line.

Understandably, senior staff, who are on higher salaries, should expect some additional hours just to get the job done.

The bigger issue comes when more junior members of staff are working late, as there is a risk they could end up working below the minimum wage.

Under the working time directive, UK workers cannot work more than an average of 48 hours a week unless they sign an opt-out, and most workers are entitled to a rest break of at least 20 minutes if they work longer than six hours per day.

While employers do not have to pay for overtime, an employee’s average pay for the total hours worked must not fall below the National Minimum Wage.

Possible penalties

If an employee is continually working over their contractual hours and their average pay falls below the National Minimum Wage, the employer can face both civil and criminal penalties.

Under civil penalties, the employer will be issued with a Notice of Underpayment and they will be required to pay a penalty to the Secretary of State within 28 days. Alternatively they may be ordered to ‘self-correct’.

The current financial penalty is 200 percent of the total underpayment up to a maximum of £20,000 (reduced by 50% if it is complied with within 14 days of service).

Employers who fail to pay in accordance with NMW can be named by HMRC, which can negatively impact operations and relationships.

Where an employer refuses to engage with the civil enforcement procedures, criminal penalties can be applied, which could include the conviction of a summary offence and the fine in respect of this can be unlimited.

Comprehensive contracts

It is important that employment contracts address overtime.

Your contract may explain that staff can claim time off in lieu (TOIL) for some overtime, but it’s up to businesses to ensure employment contracts are legal and reflect their own needs and expectations.

Most businesses will accept busier periods require staying later, but if overtime consumes entire evenings or limits time with friends and family it can become much more serious.

It is crucial that policies and contracts are routinely reviewed to allow for overtime and make clear distinctions between what additional time will be covered and what won’t be.

If you are unsure whether your business has the appropriate measures in place, contact our legal team.

Posted in CAT Know-HowComments (1)

BREXIT: UNCERTAINTY AND BUSINESSES CONTRACTS

Tags: , ,

BREXIT: UNCERTAINTY AND BUSINESSES CONTRACTS


By Lindsay Ellis – Lindsay Ellis advises on a range of legal matters, including outsourcing, procurement and commercial contracts for Warwickshire solicitor firm Wright Hassall 

Lindsay Ellis

Uncertainty surrounds the timing of Brexit, but when it does happen, there will undoubtedly be an impact on UK businesses and their contracts. It is important that organisations consider how Brexit might affect existing contracts.

Existing contracts

For many businesses, Brexit could impact their supply chain and they should consider the performance of obligations by subcontractors and suppliers. Other key areas to consider include; term, territory, currency, tariffs, customs clearance, resources, licensing/ consents and tax. Failure to review and plan for these could result in increased costs and/or damage to business performance.

Force majeure 

A contract typically contains force majeure clauses. Depending on the drafting, these can relieve a party from liability for a breach resulting from ‘circumstances beyond its reasonable control’. However, if Brexit was likely when the contract was agreed, it could be argued the parties should have planned for its effects. Without a specific reference to Brexit, force majeure clauses are unlikely to help of itself, but depending how the clause was drafted, it might address delays in delivery of goods due to crossborder issues.

Compliance with law clauses

Many contracts state that parties must comply with applicable law. It will be a matter of interpretation whether such a clause could oblige a party to absorb the costs associated with Brexit-related changes in law. Long-term contracts typically address what will happen if the law changes, often specifying that charges can only be increased in limited circumstances, with the supplier required to consult with the customer before making any changes.

Termination 

The contract may include scope for termination, by either party. This may be in connection with circumstances arising from Brexit related events or a failure to agree a change. If a contract’s termination clause gives a party a right to terminate on relatively short notice, the prospect of termination can always be raised to encourage negotiation.

Common law and frustration

Frustration arises where an event occurs after the date of the contract, radically transforming the obligations of either party or making it impossible to fulfil the contract. However, a contract is not frustrated due to inconvenience, hardship, financial loss or when the event should have been foreseen by the parties. As such, it is generally accepted that frustration will not help with Brexit, although it might apply if certain changes in law were to be made subsequently, which would make it impossible to fulfil a contract.

Interpretation and implied terms

The courts are unlikely to interpret a contract or imply a term to assist a party adversely affected by Brexit and will not relieve a party from the consequences of their poor business practices, if that involves departing from the natural meaning of the contract. Similarly, the fairness of a proposed implied term or the fact that the parties would agree to it is insufficient grounds for implying it. Both interpretation and implication of terms have regard to the background knowledge reasonably available to the parties at the time they entered the contract.

What are the options?

By not drafting contracts that address Brexit uncertainty, there is a risk that a party will be obliged to continue to fulfil its contractual obligations, even if Brexit-related events render it commercially unattractive. However, doing nothing may be an option for a party who can terminate contracts at short notice or are confident in their ability to perform regardless of Brexit’s outcome.

‘Brexit’ clause

Inserting a ‘Brexit clause’ into contracts will trigger some change in the parties’ rights and obligations when a defined event occurs. The best a Brexit clause may offer is a binding requirement for the parties to try and renegotiate the contract. For other contracts, it may be possible to specify the consequences of certain events, but with Brexit, there is the risk that events occur that have not been first considered.

Making changes

Organisations must take the time to review their existing commercial contracts, ensuring every possible outcome is accounted for and the necessary clauses are added. Seek advice from experienced contract lawyers and plan for life after Brexit, sooner rather than later.

 

 

 

Posted in CAT Know-HowComments (0)

Advertisement
  • FRANCHISING: The perils of buying into an unproven chain
  • EAT MY (BRAKE) DUST: Should we take brake pad emissions more seriously?
  • PRODUCTIVITY PUZZLE: Is the aftermarket as productive as it should be? .

more info

    • Should hand car washes face further regulation?

      View Results

      Loading ... Loading ...
    • Popular
    • Latest
    • Comments
    • Tags
    • Subscribe