Government launches consultation on mandatory gender pay reporting: Have your say

The Government has launched a consultation to establish the details of legislation required to be made in the first half of 2016 on gender pay reporting. The new legislation will make it compulsory for private and third sector employers (with 250 or more employees) to publish gender pay information.

You may recall from my article last month setting out what we can expect in the world of employment law following the Conservative’s election victory that one of David Cameron’s key pledges is to reduce the gender pay gap. Writing in the Times Newspaper following the Summer Budget, David Cameron said, “Transparency, skills, representation, affordable childcare – these things can end the gender pay gap in a generation. That’s my goal”.

Although statistics produced by the Annual Survey of Hours and Earnings in 2014 showed that when full time work is taken in isolation the gap between men and women’s pay has almost halved since records began in 1997, the Government believes that transparency will accelerate the reduction in the gap even further.

However, the legislation, which is due to be brought in around April 2016, is yet to be fleshed out. The consultation is giving employers an opportunity to have a say in the mechanisms of the new legislation.

More particularly, it is seeking views on the way that the information is collected; whether this should be providing an overall gender pay gap figure by calculating the difference between the earnings of men and women as a percentage of men’s earnings, providing figures broken down by full time and part time employees or broken down by job grade and title. The consultation recognises that in determining the metrics to be used there is a need to balance meaningful and comparable data against the need for individual confidentiality. It is also seeking employer’s views on the likely implementation costs and the actual / estimated time that is likely to be taken by the person responsible for analysing / publishing the information.

Another key question is whether additional narrative information should be voluntary or prescribed by the regulations and how regularly the information should be published; whether annually or, for example, every two or three years.

The consultation closes on 6 September 2015 and following the responses from the consultation we can expect to see a first draft of the regulations. Whilst it is difficult to predict what will be in the final regulations there is talk of them being phased, to give employers time to prepare.

Whether your organisation will be affected by the new regulations or you simply want to ensure that your policies and practices are providing equality to your workforce and assisting in closing the gender pay gap, myself or another member of the Fox Whitfield team have a wealth of experience dealing with discrimination and equal pay cases. We can also assist you in carrying out a qualifying equal pay audit.

If you would like further information or advice on this or any other employment related matter please contact me on 01173305980 or 07766562730. Or you can email me at

Protecting your Business from Your Employees with Restrictive Covenants

Update 30 July 2015: –

Top Gear: Clarkson, Hammond and May and their executive producer Andy Wilman to present a new show on Amazon.

Amazon Prime Video EU vice-president Jay Marine said: “Customers told us they wanted to see the team back on screen, and we are excited to make that happen.

“We can’t wait to see what Jeremy, Richard, James and the team will create in what is sure to be one of the most globally anticipated shows of 2016.”

The Restrictive Covenants in their contracts prevented them from making a show for a terrestrial UK broadcaster for two years. When it was drafted this may have been enough to protect the BBC but times have changed and the streaming of Television has grown. As a result the BBC was not protected from the team being able to launch a directly competitive program.

This does show how essential it is for employers to review Restrictive Covenants on a regular basis to ensure that they are still relevant and appropriate for the employees and the market they are operating within.

Recently a large law firm audited the contracts of their client and found that almost half had not audited the contracts of their senior employees to ensure they had adequate protection.

Given the current buoyant jobs market it is more important than ever to ensure that employees have up to date contracts in place to give businesses the best chance to prevent the loss of confidential information and clients if their senior employees leave.

Fox Whitfield are specialists in the both the enforcement of, and tactical evasion of restrictive covenants and confidentiality.

Paul Whitfield is the Principal Solicitor at Fox Whitfield and can be contacted on 0161 283 1276 or


In the News today: –

Top Gear: Clarkson, Hammond and May ‘blocked from ITV show by BBC

This illustrates the importance and potential power of Post Termination Restrictive Covenants. Fox Whitfield are specialists in the both the enforcement and tactical evasion from the enforcement of restrictive covenants and confidentiality.

In this article we look at the law and practice surrounding this area of law.

Why do businesses need protecting from their own employees?

 The knowledge and relationships that employees develop can be some of the most valuable assets of a business. Employees can cause serious damage to a business by exploiting this to set up their own competing businesses or to gain a position with a competitor.

For the time they are employed employees have implied contractual obligations that restrict them to some degree. Employees must serve their employer with fidelity and in good faith and keep confidential information confidential. These obligations will fall away once employment ends unless the employer has put in place other restrictive covenants in their contracts of employment.

For example Fox Whitfield recently had a case where a senior employee had left to join a competitor to whom he passed confidential pricing information to enable them to secure contracts from his employer. As he did this during his employment this was a breach of contract and we were able to prevent him and his new employer from dealing with those customers. Had he waited to hand over the confidential data until the day after his employment ended there would have been little his employer could have done unless they were protected though the employment contract.


 What is a Restrictive Covenant?

A restrictive covenant is a contractual agreement that prohibits an employee from doing something, usually after they have left the business.

The most common types of restrictive covenants aim to prevent employees from:-


  • Making use of confidential information obtained during their employment;
  • Soliciting business from customers;
  • Dealing with customers;
  • Poaching other employees to join them.


Without express contractual terms an employer would normally not be able to stop an employer doing any of those things after their employment ended.


Are Restrictive Covenants Enforceable?

It is often said restrictive covenants are a waste of time as they are not enforceable. That is not the case. They are difficult to enforce but if they have been properly written they can be and this can provide invaluable protection to a business.

Restrictive covenants are enforced though the High Court. The starting point for all restrictive covenants is that they are void as they are in restraint of trade. The Courts will only enforce restrictive covenants that are necessary to protect the employer’s legitimate business interests and that go no further than is reasonably necessary to protect those interests.

Overly restrictive covenants will not be enforceable. It is generally better to have a narrowly written short restriction that can be relied upon than to have a wide restriction that lasts for a long time that may not be worth the paper is it written on.


 Legitimate Business Interests

 The legitimate interests which can be protected by restrictive covenants are:


  • Client/customer connections.
  • Confidential information.
  • Stability of the workforce.


“No further than is reasonably necessary” depends upon several factors:-


  • The seniority of the employee.
  • The amount of confidential information the employee has and how important it is that it remains confidential.
  • The value of the client relationships.
  • The geographical location of the employer’s legitimate business interests.
  • How long it would take a replacement to rebuild client relationships.


For example it might be reasonable to restrict a dentist from setting up a competitive practice within 5 miles of their current place of work for 12 months. That is if the employer can show the majority of their patients live in a 5 mile radius and generally come to the practice once a year for check up. However, 12 months would probably be too long a restrictive covenant for a hairdresser who sees their clients several times a year.

Generally speaking it is hard to justify restrictions of longer than 6 to 12 months.

It is very important to ensure that these clauses are tailored to your business and the employees to ensure they have the best chance of being enforceable.


Garden leave and Notice Periods

The simplest, and often most enforceable, way to restrict employees is though the use of notice period and garden leave. A garden leave clause in a contract of employment allows an employer to require the employee to spend all or part of their notice period at home. This means the employee cannot start work for another employer, breach confidentiality or approach customers during this time. The cost of this is that an employee must be paid for the period of garden leave.

Garden leave must be set out in the contract of employment and would need to be reasonable in terms of its duration.


Remedies for breach of Restrictive Covenants

The most common remedy sought to enforce Restrictive Covenants is an injunction.

An injunction is a court order that stops an individual from doing something, generally from continuing to breach their contract. If done properly it can be in place very quickly and can stop an employee in their tracks. Claims to recover financial losses caused by the breach of contract may also be possible.

Injunctions are expensive to obtain and employers should write to the individual first and give them an opportunity to agree to stop breaching the contract.


Deterrent Effect

Restrictions often have a useful deterrent effect, deterring competitors from poaching employees who may be unable to compete. Most cases do not get to court as an agreement about the restrictions can be reached. The contractual restrictions will be a starting point for negotiations.


Team moves

Groups of employees leaving together can be a very serious issue and restrictive covenants can be very useful in limiting the damage from this sort of attack. The Courts have recently enforced them in several cases to prevent the teams from actively competing for a period of time.

Once an employer becomes aware that there may be a team planning to leave, it is important to act quickly to try and minimise the damage. For employers looking to recruit teams, careful planning and execution will be necessary as there are many pitfalls to avoid.


Practical tips

  • Draft restrictive covenants carefully and tailor them to the particular circumstances.


  • For existing employees introduce new restrictions with a pay review or promotion.


  • If you think there is a breach gather as much evidence as possible and seek immediate legal advice. Delay can mean no injunction.


  • Restrictions must be regularly reviewed and new contracts issued on promotions with appropriate restrictions.


Paul Whitfield is the Principal Solicitor at Fox Whitfield and can be contacted on 0161 283 1276 or


General Election 2015: The outcome and a look at what this means for UK employment law

With the Conservatives securing a majority win in the general election last month what does this mean for UK businesses in 2015/2016 and UK employment law in the next five years.

In this article Dionne Dury, from our Bristol office, summarises some of the key pledges made by the Conservative party and steps already taken by the new Government to deliver on its promises.

The key pledges:


The Conservative manifesto made a bold statement stating it would transform, “policy, practice and public attitudes to get disabled people into employment”. Unfortunately, the manifesto was not clear on how it intended to achieve this so watch this space!

What was clear from the manifesto was an intention to address the gender pay gap and support greater female representation on boards.

The party has already made steps towards achieving this goal with legislation requiring larger employers (of 250 employees or more) to disclose information on gender pay gaps. This legislation was laid before Parliament before it was dissolved for the election and must be implemented by April 2016.

National Minimum Wage (NMW)

The party also pledged to support an above-inflation rise in the NMW to £6.70 per hour by autumn this year (compared to the current rate of £6.31) and to achieve an increase to £8.00 per hour by 2020.

It has also been proposed that the tax-free allowance will be increased to £12,500 so that by the end of 2020, “people who work for 30 hours a week on the increased National Minimum Wage will no longer pay any Income Tax at all”.

Zero hour contracts / provisions under the Small Business, Enterprise and Employment Act (SBEEA)

A pledge was made to prohibit exclusivity in zero hour contracts and the party has kept to its promise.

On 26 May 2015 a number of provisions, including the prohibition of exclusivity in zero hour contracts, were implemented under the SBEEA.

As well as providing a useful definition of zero-hours contracts, as being a contract under which a worker offers to undertake work on behalf of the employer on request, there being no guarantee of work, the Act confirmed that any provision in such a contract purporting to prevent the worker from undertaking work for a different employer or requiring the employer’s consent to do so, is unenforceable.

It remains to be seen whether a ban on exclusivity will address the perceived unfairness of these types of contracts.

The Act also introduced new penalties for employers who fail to pay Tribunal awards or settlement sums and fines for non-payment of National Minimum Wage. The National Minimum Wage Act 1998 has been amended so that the maximum £20,000 penalty for non-payment applies in respect of each worker who is underpaid NMW. Previously, the maximum penalty applied per under-payment notice to the employer, so this rise represents a potentially large increase.

The SBEEA has also provided clearer definition on the meaning of “small businesses” being, a headcount of fewer than 50 and a specified threshold for turnover and balance sheet and “micro businesses” being, a headcount of fewer than 10 and a specified threshold for turnover and balance sheet.

Tribunal reform

Despite the opposition parties calling for Tribunal reform or a reduction in the current Tribunal fee levels, the Conservative party made no such pledges in their manifesto and supported the retention of Tribunal fees.

However, this month saw the long awaited Government review of the Tribunal fee and remission scheme. The review is expected to continue for several months.

Statistics published by the Ministry of Justice at the beginning of this month showed a sustained reduction in the number of Tribunal claims lodged since the introduction of the scheme in 2013. The reduction suggests that the ACAS Early Conciliation process is encouraging parties to resolve their disputes. However, it is also possible that the reason for the reduction in the number of claims being issued is the fees themselves and this begs the question of whether employees are being given the appropriate access to justice?

UNISON’s appeal against the High Court’s rejection of their judicial review proceedings challenging the fees regime was heard on 16 and 17 June. The outcome of that appeal is unlikely to be known until the autumn but it will clearly impact on the outcome of the Government’s review. Even if the appeal is unsuccessful it is still possible that the Government decides in a reduction in fees.

Today (30 June 2015) Andy Burnham, the front runner in the Labour leadership race said that all upfront Employment Tribunal fees should be scrapped.

EU Referendum

The promise of a referendum on the UK’s continued membership of the European Union has significant implications for employment law. Some commentators believe that we are “governed by Brussels” with 90% of our laws coming from the continent. Whether or not this is the case, it is clear that a large proportion of employment law has an EU connection and a vote in favour of leaving would clearly have huge implications for UK employment law.

Keep watching this space for updates and changes as they occur.

For further information or advice on these or other employment related matters you can contact Dionne Dury on 01173305980, 07766562730 or

Acas guidance on calculating holiday pay

The following is the text of new guidance from ACAS on calculating holiday pay. It relates specifically to overtime, commission, work-related travel and sick leave issues.

Employers and employees should take specific legal advice on this as ACAS says “”there is no definitive answer about how holiday pay calculations must be made”. The final point in their guidance is: “Until further clarification is available, employers may wish to seek legal advice based on their individual circumstances.”

The full guidance is: –

Calculating holiday pay

In addition to current legislation, a number of recent court judgments should be considered when calculating holiday pay.

This means that the rules employers and workers follow to calculate holiday pay may need to be updated.

Key points:

  • Guaranteed and normal non-guaranteed overtime should be considered when calculating a worker’s statutory holiday pay entitlement but there is currently no definitive case law that suggests voluntary overtime needs to be taken into account.
  • Commission should be factored into statutory holiday pay calculations.
  • Work-related travel may need to be factored into statutory holiday pay calculations.
  • A worker’s entitlement to holiday pay will continue to accrue during sick leave.
  • There are different rules for calculating holiday pay depending on the working patterns involved.
  • Workers must take their statutory paid annual leave allowance and can only be ‘paid in lieu‘ for this when their employment ends.

Guaranteed overtime

Guaranteed overtime is where the employer is obliged by the contract to offer and pay for agreed overtime. Following a judgment in 2004, guaranteed overtime must be included within the calculation of holiday pay.

Non-guaranteed overtime

Non-guaranteed overtime is where there is no obligation by the employer to offer overtime but if they do then the worker is obliged by the contract to work overtime. On 4th November 2014 the Employment Appeal Tribunal made a ruling in the case of Bear Scotland v Fulton which covers how holiday pay should be calculated when non-guaranteed overtime is worked.

The judgment has clarified that:

  • Workers should have their normal non-guaranteed overtime taken into account when they are being paid annual leave.
  • Anybody making a claim must have had an underpayment for holiday pay that has taken place within three months of lodging an employment tribunal claim.
  • If a claim involves a series of underpayments, any claims for the earlier underpayments will fail if there has been a break of more than three months between those underpayments.
  • Only the 4 weeks’ annual leave entitlement under the original Working Time Directive are covered by this judgment, rather than the full 5.6 weeks’ leave provided by the Regulations as they operate in Great Britain.

This judgment may have an impact in situations where non-guaranteed overtime is carried out by workers on a regular or consistent basis.

It is unlikely to have an impact in situations where non-guaranteed overtime is either already factored into holiday pay, or possibly where this overtime is only used on genuinely one-off occasions.

Employers, workers and trade unions are encouraged to discuss any concerns arising from this judgment with a view to seeking agreement on any measures or policy changes they feel may be necessary. Acas may be able to help parties find solutions and employers or workforce representatives may find it helpful to discuss the issue with an Acas Collective Conciliator.

Limit on a claim for an underpayment

On Thursday 18 December 2014 the Government announced a planned change to the Employment Rights Act 1996 in relation to claims for deduction of wages. The change will mean that when making claims for a series of backdated deductions from wages, including any shortfall in holiday pay, the period that the claim can cover will be limited to a maximum of 2 years.

It is expected that the effect of this change will be to limit the scope for a claim for deductions from pay going back more than 2 years for any claim presented on or after 1 July 2015.

Voluntary Overtime

Voluntary overtime is where the employer asks the worker to work overtime and the worker is free to turn down the request as there is no contractual obligation on either side to offer or refuse overtime. The question of voluntary overtime has not been directly considered by any recent judgments, so there is currently no definitive case law to suggest that voluntary overtime needs to be taken into account when calculating holiday pay.


Commission is usually an amount of money a worker receives as a result of making sales and can make up some or all of their earnings.

Commission must be factored into holiday payments for the 4 weeks of statutory annual leave required under European law. There is no requirement to do this for the additional 1.6 weeks of statutory annual leave provided under UK law, or for any additional contractual annual leave allowance. This was confirmed on 22 May 2014 when the European Court of Justice heard the case of Lock v British Gas Trading Ltd.

At present, there is no definitive legal answer about how such holiday pay calculations must be made, or how/if claims can be backdated.

The Lock v British Gas Trading Ltd case has been referred back to the UK to consider how commission is calculated into holiday pay for that particular case. While part of the case was heard at the Employment Tribunal on 5 February 2015, the final judgment has not yet been made. When the judgment is made, it is important to note that an Employment Tribunal judgment is not binding on any other case – it would need to be appealed to the Employment Appeal Tribunal to have such an effect.

Work-related travel

Work-related travel can have a number of different meanings but for most employment matters, this will usually mean any travel that is made for work purposes that is not a part of a workers commute to their usual place of work. On 4 November 2014 the Employment Appeal Tribunal issued a judgment in a case joined to Bear Scotland v Fulton which covers how holiday pay should be calculated in relation to work-related travel.

Where payments are made for time spent travelling to and from work as part of a worker’s normal pay, these may need to be considered when calculating holiday pay.

Holiday pay and sickness

When a worker takes paid or unpaid sick leave, their annual leave will continue to accrue. If a worker is unable to take their annual leave in their current leave year because of sickness, they should be allowed to carry that annual leave over until they are able to take it, or they may choose to specify a period where they are sick but still wish to be paid annual leave at their usual annual leave rate.

Calculating holiday pay for different working patterns

No matter the working pattern, a worker should still receive holiday pay based on a ‘week’s normal remuneration’. This usually means their weekly wage but may include allowances or similar payments. Some of these payments might include the situations described earlier on this page, such as commission.

  • For workers with fixed working hours – If a worker’s working hours do not vary, holiday pay would be a week’s normal remuneration.
  • For workers with no normal working hours – If a worker has no normal working hours then their holiday pay would still be a week’s normal remuneration but the week’s pay is usually calculated by working out the average pay received over the previous 12 weeks in which they were paid.
  • For shift workers – If a worker works shifts then a week’s holiday pay is usually calculated by working out the average number of hours worked in the previous 12 weeks at their average hourly rate.

Payment in lieu of holidays

While workers are in employment, 5.6 weeks of their annual leave (this is the amount all UK workers are statutorily entitled to) must be taken and cannot be ‘paid off’. Anything above the statutory allowance may be paid in lieu but this would depend on the terms of the contract.

When a worker’s employment is terminated, all outstanding holiday pay that has been accrued but not taken (including the statutory allowance) must be paid.

Further Information

Until further clarification is available, employers may wish to seek legal advice based on their individual circumstances.

The Impact of Employment Tribunal Fees

Just prior to losing his seat as an MP and his position as Business Secretary, Vince Cable, announced the findings of a review that he commissioned into the impact of employment tribunal fees. In summary: –

  • The total number of employment tribunal dropped by almost 70%.  (From 340,000 in the first quarter of 2013-2014, to just over 110,000 in the third quarter of 2014-2015).
  • Sex discrimination claims were down by 82%.
  • Equal pay cases were down by 72%.

In an interview with the Independent he said “here is enough evidence to suggest that this was a very bad move and should be reversed,” he said. “It is highly suggestive that the fees are discouraging people – particularly low paid women—from pursuing their rights.”

Given the results of the General Election. The fees will be staying and will not be reversed for at least the next five years.

Mr Cable also warned that a right-wing government – perhaps a Tory-led one backed by Ukip—would revive proposals like “fire at will” within months. “They have an unfinished agenda,” he said.

Employment Law Solicitors – Head Office based in Manchester with offices located throughout the United Kingdom.