Health and safety – the need for change?

The UK has a culture of ‘over-compliance’ with health and safety matters and a rapidly expanding industry of specialist consultants in whose interests it is to exaggerate the levels of risk mitigation required to comply with legal requirements.

These opinions are included in a recent report, Health and Safety: Reducing the Burden, by the Policy Exchange think tank, which serves to support the increasingly widely held public belief that too much in our society is the result of ‘health and safety gone mad’.

The report’s author, Corin Taylor, who is a senior policy adviser at the Institute of Directors (IoD), believes that much needs to change. As he says: “Health and safety regulation has a long history and a noble purpose. Britain has gone from a country where children climbed chimneys to sweep away coal dust to virtually the safest place to work in the EU.

“But something has clearly gone wrong. There’s such an enormous amount of uncertainty about health and safety legislation, that this has led to a culture of over-compliance. Matters are little helped by the fact that there are no qualifications required to become a health and safety consultant, and it’s possible to acquire an industry-respected health and safety certificate after just 10 days.”

Such a low barrier of entry to becoming a consultant has seen the creation of more than 1,500 specialist health and safety firms emerge, comprising a fast-growing sector that analysts currently value at between £700 million and £1 billion.

While the report does not question the importance or relevance of appropriate legislation and enforcement to protect the well-being of workers, it does call for more clarity on the legal requirements facing businesses and for a reassurance that only proportionate, commonsense and practical steps need to be taken.

In addition, it recommends among other matters that a minimum qualification standard should be introduced for consultants and that steps should be taken to lower the cost of health and safety legislation. It also questions whether some requirements, including risk assessments, should be lifted from low-risk businesses, and whether self-employed people should face any requirements at all apart from the need not to harm others.

As the report concludes: “The last, and biggest, question is whether we should really try to eliminate all risk, or whether we should try to manage risk effectively. At some point, the marginal cost of risk-mitigation will exceed the marginal benefit of fewer injuries.”

The real reasons for pulling a sickie?

A recent survey has established something that many have suspected was true – that the hangover is the biggest cause of employees pulling a ‘sickie’.

The research, by recruitment company review website HireScores, found one in three people admitting that they would be inclined to call in sick on a Monday rather than any other day of the week. A quarter of the respondents said they were most likely to call in sick on a Friday to start their weekend early.

Of those people who admitted to faking illness to get a day off, a staggering 89% said they would do so thanks to a hangover. Other reasons included being tired after a late night (68%), wishing to stay with a partner (53%), wanting a holiday (49%) and not being bothered to go to work (47%).

According to HireScores Managing Director Lisette Howlett, “The next time you look around the office on a Monday or a Friday and it seems light on the ground, now you’ll know why!

“On a more serious note, this no doubt costs British employers a huge amount of money, especially in terms of lost productivity and the loss of morale of co-workers who know that their colleagues’ sickness absence is not genuine.”

Does money make you happy?

A new report has gone some way towards proving the Beatles’ claim that “Money can’t buy you love”. Researchers at Cardiff University and the University of Warwick have found that earning more money only makes you happier if you feel richer than your friends, neighbours and colleagues.

Comparing happiness levels with those of other people of the same age, sex and level of education showed, in fact, that money only makes people happier if it improves their standing in society.

Lead researcher Dr Chris Boyce commented: “Earning £1 million a year appears not to be enough to make you happy if you know your friends all earn £2 million a year.”

He continued, “It’s important to remember that human beings are innately status-obsessed. In the days before his windfall, the lottery winner may have envied his neighbour’s new car or coveted his conservatory.

“But the odd thing is that this compulsion does not diminish even if the same man becomes as rich as Croesus. He will just hanker after even grander acquisitions: his richer neighbour’s yacht, his jet or his private estate off the Bahamas.”

According to the researchers, this obsession with comparative fortunes is why the last 40 years’ rising prosperity has not increased overall happiness levels.

Company cars and the law

Many businesses that provide their employees with company cars are unaware of the legal duties and responsibilities that surround them.

There is, for example, an important distinction between contracts that provide a vehicle solely for business use and those that also allow private use. In the first case, a car may be withdrawn when the employee is not actually at work (eg on holiday or on garden leave).

On the other hand, a car provided for private use is a part of the employee’s contractual entitlement and cannot be withdrawn. Clarity is therefore important – employers should make certain that full details of the arrangement are part of the contract of employment, including the type of car provided and the replacement schedule.

Although statutory sick pay must be provided whenever an employee is off sick, employers are under no obligation to continue paying wages or salary. The situation is different with a company car however – unless there is a clear statement in the contract that car allowance will be suspended, the employee can expect it to continue.

Talk to an expert in employment law for fuller details and for advice on all aspects of drawing up a contract of employment.

Uncovering dubious business practices

When a director uncovers what might be called ‘dubious’ business practices in his or her company, they can find themselves in a problematic situation – particularly if they find that there has been an attempt to disguise the company’s true financial situation.

If you find yourself in this position, it is very important first to establish the true facts before taking any action. Once you have uncovered the impact, scope and severity of the situation, you need to consider your ethical position, particularly in light of the duties of directors under the Companies Act and your own contract of employment.

To make sure that you fully understand your obligations, talk with your board colleagues or HR department, ensuring that you do not breach confidentiality. Do bear in mind, however, that provided you make a ‘protected disclosure’, you are protected by the Public Interest Disclosure Act 1998 against discrimination by your employer.

At this point, it will always be sensible to seek professional legal advice. While taking the wrong action might have awkward ramifications, taking no action may place you in an even more difficult legal situation, so it is important that you have the best possible guidance.

New Act to eradicate inequality

More than 40 years after the first legislation was introduced in this country to prevent discrimination, many inequalities still exist in the workplace.

It is to eradicate these – including lower pay for women and high unemployment among ethnic minorities and disabled people – that the new Equality Act is to be implemented this autumn following its final reading in the House of Commons in late March.

The new Act, designed to streamline and strengthen the current position, has been championed by the Commission for Equality and Human Rights (CEHR). It has condensed nine major existing pieces of legislation and some 100 other measures into a single Act.

We will look at the new Act in more detail in the next issue of Right Focus, but we must emphasise now the importance for businesses of training their employees in its requirements.

This is because a number of formerly usable ‘defences’ against prosecution under anti-discrimination legislation have now been removed, and because the potential cost of being found guilty have risen. For example, awards for injury to feelings in discrimination cases will now range from £600 to £30,000.

Anyone keen to receive an impartial overview of the primary implications of the new Act should talk to a specialist employment lawyer.

Insolvencies up, bankruptcies down…

Figures from the Insolvency Service show that more people were declared insolvent in 2009 than any year since records began in 1960.

During the year, 134,142 people in England and Wales were declared insolvent, 26% higher than in 2008 and nearly 27,000 ahead of the previous record from 2006.

However, thanks to growing awareness of alternatives to bankruptcy – namely, the individual voluntary arrangement (IVA) and the Debt Relief Order (DRO), which was introduced in 2009 – bankruptcies in the last quarter of 2009, at 17,007, were 5.5% down on the same period in the previous year. This means that fewer insolvent people were in danger of losing their homes.

The fact that IVAs were up in the same quarter by 26.3% on the previous year suggests, however, that creditors are getting tougher with their debtors. Unlike bankruptcy or a DRO, an IVA involves paying back at least some of your debts under a deal arranged between you and your creditors.

According to Louise Brittain of consulting firm Deloitte, “This is a result of increased creditor pressure which is unlikely to let up any time soon, and highlights the desperate financial difficulties facing individuals.”

If you are concerned about your financial situation, seek professional advice as early as you can.

Repossession figures less serious than expected

Data from the Financial Services Authority (FSA) suggests that the UK’s low interest rate regime is having a positive impact on the most vulnerable home-owners, and that earlier predictions of ‘record’ repossession levels were wide of the mark.

In addition, the last quarter of 2009 saw a 4% fall in the number of borrowers behind with their repayments. The number of new cases was also down by 9% on the previous quarter (and by 39% over the final quarter of 2008).

At 41,000 new cases, however, the figures are still extremely high and suggest a picture of widespread financial hardship across the UK. Anyone who is concerned that they may struggle to meet their mortgage obligations should contact their lender as early as possible.

New pension regime encourages career breaks

Major changes introduced to the UK’s pensions system this April are bring widely hailed as the start of a process that will see the age at which Britons can become pensioners gradually start to creep up.

Over the next decade the state retirement age for women will move from the current 60 to 65 and equality with men. Once that parity has been achieved, it is expected that the limit will slowly rise again for both sexes, up to 68 by the year 2046. Some experts are also predicting that the age will rise even further, meaning that anyone now aged 30 may not receive a state pension until the age of 70 or even older.

There is an upside, however. From now on, a mere 30 years of national insurance contributions are required to qualify for a full state pension, as opposed to the previous 39 years for women and 44 years for men. In addition, this will build on an incremental basis, meaning that even as little as one qualifying year will deliver some level of pension.

This means that it is now possible to take a 15-year career break and still qualify for a full state pension. This is particularly good news for people who have had to take time away from work, perhaps to look after an ill family member or to study.