Can you sack someone who's already working their notice?   What to do when a leaver behaves badly....

Expense Claims   Maybe the recent expenses scandal highlights the need for organisations to have a robust expenses policy in place!

New National Minimum Wage Rates   The new minimum wage rates from 1st October 2009

Can you sack someone who's already working their notice?

Picture the scene - you've been through a redundancy consultation process and given one of your employees notice of termination of employment. When she's halfway through her notice period you discover that she's been stealing money from petty cash. Can you sack her for gross misconduct instead of redundancy? After all, you've technically already sacked her once.......

Where notice to end a contract of employment is given and the employee is working their notice, the period of employment comes to an end at the end of the full notice period. If, however, you have reason to believe that an employee has committed an act of gross misconduct during their notice period, and the contract allows for summary dismissal, you can dismiss them with no notice, provided you have followed a fair procedure. In this instance, assuming the case of theft was proven, the reason for dismissal is now gross misconduct, not redundancy and she would forfeit her right to a redundancy payment and a notice payment.

Remember that you would have to investigate the allegation first, allow her the right to be accompanied at any formal hearing and allow her to appeal against the dismissal decision.

Other issues to bear in mind when dismissing someone:

1. You can only put someone on garden leave if there is a clause in the employment contract allowing you to do so.

2. Only make a payment in lieu of notice (PILON) if there is a clause in the contract allowing you to do so. Making a PILON payment without such a clause would be a breach of contract. This would mean that any other clauses in the contract preventing the employee working for a competitor after they leave you or pinching your other employees would be null and void.

3. The downside of having a PILON clause in the contract is that the payment becomes taxable; in the view of HMRC, the employee knew they were entitled to such a payment and therefore it's a taxable benefit.

Expense Claims

According to research conducted by American Express only just over half (51%) of small companies and business have a formal expenses policy in place with many employers reliant upon the honesty of their employees when making expenses claims. 

Research conducted by Business Advice in 2007 found that nearly a fifth (18%) of employees thought it was acceptable to exaggerate claims and 14% admitted to having done so.

Given these findings and the recent developments in the news, it may be wise for businesses to implement rather more robust approaches to managing their expenses claims than those currently being applied to our MPs. 

Picasso HR can help your organisation to devise a clear, fair, robust expenses policy to help you to ensure that employee expenses are repaid promptly while protecting you from unreasonable or exaggerated claims.  Contact our advisors on 01473 890037 for further advice.

New National Minimum Wage Rates

The minimum wage has been reviewed and the new rates to be applied from October 2009 area as follows:

The youth rate for workers aged 16 and 17 will rise from £3.53 per hour to £3.57 per hour

The developmental rate for workers aged 18 to 21 will rise from £4.77 per hour to £4.83 per hour

For workers aged 22 and over the rate will rise from £5.73 per hour to £5.80 per hour

Historically it has been possible for tips, service charges, gratuities etc that are collected by the employer and then paid to the employee via the payroll system to be counted towards the minimum wage.  However, from October 2009 this will no longer be possible.  New legislation will prevent all forms of tips from counting towards the minimum wage and employers will be liable to pay the full amount.

The Government has also announced a change to the developmental age category which will come into effect in 2010.  This change will affect employees aged 21 who will become eligible for the full adult minimum wage from October 2010. 

Don't forget to diary to review your salary payments to avoid falling foul of the legislation!

The information in this newsletter is of a general nature and is not a substitute for professional advice. You are recommended to obtain specific professional advice before you take any action.

For further information, advice or assistance on any of the matters raised in this newsletter please contact Picasso HR on 01473 890037.

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