Employment Law Coffee Break | Discrimination in working arrangements, mental health and wellbeing, and our April HR Pensions spotlight
Published on 29th Apr 2022
Welcome to our latest Coffee Break in which we look at the latest legal and practical developments for employers.
Working arrangements and discrimination risks
With employers encouraging employees back to the office and re-establishing set patterns of work, more issues are arising for those employees who have difficulty complying with a particular place of work or hours of work requirement. Employers are increasingly needing to assess the fairness of any place and time of work requirements and key to this is considering any potentially discriminatory impact. A commonly arising issue is whether a requirement to work full time or particular hours has an indirectly discriminatory impact on those with childcare commitments, who are more likely to be women.
In a recent case, the claimant complained of a provision, criterion or practice (PCP) of being required to guarantee her availability to work the Thursday late shift, something she was unable to do because of her childcare responsibilities. In assessing the discriminatory impact of the requirement, the Employment Tribunal (ET) included within the pool for comparison two male employees and concluded that the claimant could not show that the requirement put women at a disadvantage compared to men and there was, therefore, no indirect discrimination.
On appeal, the Employment Appeal Tribunal (EAT) found that the ET had wrongly failed to address the specific PCP of which the claimant complained and had included within the pool for comparison two individuals to whom the respondent had not applied the same degree of compulsion, namely the requirement that they "guarantee" their availability for the late shifts in question "for an employee who is having to balance work and caring responsibilities, the question whether they are required to guarantee their availability (the PCP of which the claimant complained) or whether they might sometimes simply be asked to help out, is likely to be of considerable importance".
The pool of those upon whom the effect of the PCP is evaluated must be populated by persons who – apart from the protected characteristic at issue – are in circumstances that are the same or not materially different. For employers making an assessment of any potentially discriminatory impact of a requirement (for example, to work particular hours), all the workers affected by the PCP in question should be considered, then the comparison can be made between the impact of the PCP on the group with the relevant protected characteristic and its impact upon the group without it. It remains open to businesses to objectively justify the need for any PCP which has a discriminatory impact; employers should always give serious consideration as to why they are introducing any particular requirement and record the business reasons for it should it be challenged down the line.
Training should be provided to managers to ensure that they know how to deal with any concerns raised regarding any policy on working arrangements and do not dismiss them out of hand. Individual workers may also make a statutory flexible working request where they wish to make changes to their working hours, for example to accommodate caring responsibilities. While the statutory regime only applies to employees with 26 weeks' continuous employment, again, it will be important to bear in mind the risk of discrimination claims (for which no period of service applies) when any requests are received.
Keeping mental health and wellbeing on the agenda: call for evidence
The government has this month published its "Mental health and wellbeing plan: discussion paper" which calls for evidence to help in the development of a "comprehensive plan" which will help set and achieve the government's vision for mental health in 2035. A statement from the Lived Experience Advisory Network, who provide advice and direction on NHS policy decisions "using their unique perspectives and expertise", highlights the need for a "shift [in] how we approach the subject of mental health... if we are going to truly change things for the better, we need to think about people as a whole – what makes up their lives, and their needs, wants and ambitions" and the need for "compassionate employers who are able to meet us where we are at, and can support us to meet our full potential. People who can understand and can meet our physical and mental needs in the workplace and enable us to thrive at work".
Looking at where we should be in 10 years' time, the paper identifies challenges including "the need for a clearer role for the private sector including businesses, employers and online platforms, in preventing the onset of mental health conditions and mental ill-health, and wider implementation of workplace interventions to support mental health as identified in Thriving at Work. There is a strong evidence base showing that work is generally good for physical and mental health and wellbeing" with workplaces "ideally placed to identify people who may be struggling and offer support early". Our earlier Insight sets out the workplace recommendations identified in "Thriving at Work".
The Covid-19 pandemic put mental health and wellbeing to the top of business agendas, although a recent report from the CIPD indicates it may now be becoming less of a priority. However, the Call for Evidence provides a timely reminder that employers must not become complacent:
- As the discussion paper identifies, mental health and wellbeing remains a very real issue across society, with disparities existing between different groups (for example by ethnicity, age, those with long term physical health conditions and the neurodiverse). Higher risks of mental health issues have also been identified in groups who have experienced displacement, including refugees and asylum seekers, people who have experienced traumas as the result of violence or abuse and unpaid carers.
- The paper also identifies a "worrying trend" of increases in probable mental disorders in children and young people and "emerging evidence that more recent social changes" – for example through social media and increased use of screen time – "may have harmful impacts on mental health, with potentially disproportionate effects on children and young people"; many of whom will make up the future workforce.
- More immediately, it is important to remember that employees may still be struggling with longer term impacts of the pandemic: including on-going anxiety particularly where an individual is vulnerable, has symptoms of long Covid, or a mental health condition which has arisen or been exacerbated by the way we have lived over the last two years (we look here at statistics reported by the Health & Safety Executive), as well as the introduction of new working arrangements.
With a focus on the return to business, employers must take care to ensure that health and wellbeing – issues which the pandemic has clearly demonstrated are important to employees – do not drop off the agenda. As well as looking at what internal and external support can be put in place, such as a mental health charter underpinned by internal mental health champions and an external Employee Assistance line and signposting of other resources, it will be important to ensure that managers remain sensitive to potential mental health and wellbeing issues. It should be remembered that a mental health condition may be a disability for the purposes of the Equality Act 2010 protection, meaning particular care will need to be taken when managing any workplace issues which may arise, such as poor performance, intermittent or long term sickness absence. The way a situation is handled may also give rise to claims of constructive dismissal.
Our Employment team works together with our specialist Health and Safety team on mental health issues in the workplace. If you would like to discuss how we can support you and your managers, please do contact us or Partner Mary Lawrence in our Health and Safety team.
HR pensions spotlight: employer governance of group personal pension schemes
Employers are not legally required to review and monitor the workplace pension schemes they provide for their employees but the Pensions Regulator considers it good practice to do so. One way to do this is to set up a management committee.
Playing an active role in your scheme
A management committee would generally include employer representatives (typically from Human Resources or Finance), scheme members or union or worker representatives and potentially (but not always) third parties, for example, from a benefit consultancy. Member representatives can provide a valuable insight into how your employees view the pension scheme.
Master trusts and group personal pension plans are already formally governed by their providers and/or scheme managers, but at a scheme level, rather than at a workplace level. Management committees oversee the scheme's performance from the point of view of the employer and workforce – is your scheme working well for your employees?
- Is the pension scheme competitive? The committee can consider the costs and charges taken from members' savings by the provider and the scope of services delivered by the provider. Are costs competitive and are the services appropriate for your employees? This exercise will help to ensure that you and your employees are receiving value for money from the pension scheme.
- How do your employees engage with your pension scheme? Employee engagement in workplace pensions tends to be relatively weak, which may stem from a lack of understanding of how the pension scheme operates. A management committee can survey the workforce to measure how happy your employees are with the scheme, the provider's efficiency and the effectiveness and the clarity of the provider's communications. The findings and committee's recommendations can then be fed back to the employer and provider to secure improvements.
- Do the investment strategy, default investment fund(s) and other investment options offered meet the needs of your workforce? A management committee can meet with the pension provider to discuss investment performance and the available options, to help meet the needs of the various cohorts that make up your particular workforce, taking into account factors such as age, earnings and financial sophistication. Having an awareness of how the scheme operates, including how contributions are invested and what information or services are available, will also help you to effectively communicate with employees when asked questions about the scheme. Remember though that neither employers nor management committees can give pensions advice to employees.
What guidance, tools and online resources are available to your employees? The committee should consider whether employees have access to the information they need, in a way which is accessible, to make informed choices on their investments and gain a clear understanding of the adequacy of their contributions, the importance of investment suitability and how to meet their retirement goals. What proportion of your workforce engages with the provider's online services? Does this proportion represent one or more particular cohorts of staff? Would some find an app more helpful or would provider presentations work better for certain groups?
What support does the provider give your employees when they are considering retirement options, or if they have a complaint? A management committee can ask the provider to share information on complaints and queries received and also be a port of call for employees who are unhappy with how they have been treated by the provider. This will identify problems in the administration of the scheme and enable the committee to raise these with the provider early to achieve a swift resolution.
How are risks associated with your workplace pension scheme assessed and managed? A management committee should seek to identify such risks and record them in a risk register to help monitor and mitigate them. Operational risks include, for example, data errors by the employer and/or provider, contributions failings, missed deadlines, missed employees or atypical workers, data protection or other regulatory breaches. How is personal data shared with the provider, who has access, how secure is the data transfer process? What internal controls does the employer use to help ensure a sound process? A management committee can also ask the employer and provider to report on their cyber security processes and protections and on how they deal with other operational risks. Less obvious areas of risk include low levels of employee engagement or contributions and how poor pension outcomes may impact on retirement and succession planning at the workplace.
If you would like to discuss any aspect of the above in more detail, or would like help in setting up a management committee, please speak to your usual Osborne Clarke contact or Claire Rankin, Partner in our Pensions team.