Welcome to the series notes of ACCA F4. In this article, we will discuss Employment law.
Test to determine the relationship between an employment
How to know whether a person is an employee or self-employed?
By Control Test
We can determine by the “control test” where an employer suggests or tell the role and duties of an employee. We can find an employee by this test.
By Integration Test
In an “Integration test” If the person works within or internally in the organization he is an employee because he works integrally if not work in an organization or nonintegral then he is self-employed.
By Economic reality or Multi-Test
If you provide all the necessary things to do work then it is “Employee” and if you do not provide any economic facility then it refers to “Self-Employed”. If any loss is occurred “Employee” is unaffected but “Self-Employed” will be affected by the loss.
Why differentiate between Employees and Self-Employed?
What Is The Contract Of Employment
This is the contract between an employee and employer and it tells the rules, duties, and boundaries of an employee within the workplace or in an organization.
Express Term: the terms between an employee and employer can be in written or oral form.
Note: According to the “Employment Right Act 1996” there must be a written statement between the employee and the employer and after 2 months of the period there must be a signed contract.
What Is Principal Statement In Employment Law
It usually relates to businesses, the content of the principal statement is the following:
- Business name
- Employee name. job title, job description, and joining date
- Previous job information
- Salary and date of payment
- Working hour
- Holidays
- Working area
Written Statement
It is usually made for employees, the content of the written statement is the following:
- Contract finished date
- Notice period
- Collective agreement
- Pension (If any)
- Whom to reach if any problem occurs
- Complain about dismissal
Note: If anything change in these statements employer must notify the employee.
Terms implied by the court
Following are the duties of an Employee toward his Employer
- Obey duties and reasonable orders
- Mutual cooperation and personal duties in a reasonable manner.
- Work with care and skills
- Duty should perform with honesty
- Do not give your work to others unless your employer gives you permission.
Duties of an Employer toward his Employee
- Reasonable Salary
- Indemnify the employee means if an employee pays for something for a company the employer must pay him.
- Safe and relaxed environment
- Reasonable notice for termination
- Mutual Co-Operation
- Sufficient work
- Good reference
Employment Rights Act 1996
Main points:
- Right not to be unfair dismissal
- Have to pay redundancy pay if it made
- Right to give minimum notice period for termination of a contract.
Working time regulation 1998
- Working hours should be 48 hours a week
- Paid leave for four weeks
- One day can take leave or can off in a week
Employment Act 2002
Parents have the right for requesting flexible time or hours of duty if their child or children are disabled or too young.
Equality Act 2010: everyone is equal no one should be judged on anything (height, gender, color, etc).
National minimum wage Act 1998: Imposed minimum level of pay a day.
Wrongful and Unfair dismissal
Minimum Notice Period: If an employer wants to fire an employee he has to give a minimum notice period so he can find another job for his survival.
Wrongful dismissal: Fire an employee without any notice (the term used for this situation is “summary dismissal” or before a fixed period of time.
Unfair dismissal: Fire or terminate an employee without any logical or valid reason.
Constructive dismissal: employee leave the job because of wrong conduct of the employer.
An employee can be dismissed for these fair reasons:
- Because of the lack of capacity or efficiency
- Qualification
- Way or conduct of working
- Redundancy (but have to pay some things in this case)
Inadmissible reason for dismissal
- Victimization of health and safety or complaint or whistleblower
- Pregnancy or maternity leave rights
- Membership or non-membership activities
- Statutory right taken
- Unfair redundancy
Remedies for unfair dismissal
Reinstatement: Returning to the same job or same position.
Re-engagement: other or comparable employment
If these two are not then compensation is the last option.
Redundancy
The employee is fired because of no need for it means there is no longer a need for that particular work or business.
Redundancy can occur because of shutting off the business, closing of an office, or no more need for that particular work.
In the redundancy case, the employer should consult with the employee otherwise this will be an unfair dismissal.
Notes: If 20 or more employees at the same time redundant in one place within 90 days period,” this is called “Collective Redundancy“. But before doing this we have to notify related authorities.
Redundancy pay
- The basic reward for unfair dismissal
- The employer must give 4 weeks time to the employer to find a new job.