IGA News

Be Aware - August 2019

Be Aware - August 2019

31 July 2019

Employing Apprentices

Many employers recruit apprentices to enable them to avoid skill shortages in traditionally skilled occupations. Apprenticeships are common within the motor industry and can be very beneficial for both apprentice and master. However as with all staffing decisions you do need to understand them? in order to ensure they are right for you and your business

What is an apprenticeship

An apprenticeship is a work-based training programme which leads to nationally recognised qualifications. It usually permits the apprentice to attend day release training whilst combining attending the workplace and working alongside experienced employees/workers. It can either be for a fixed term period or until a level of qualification is reached.

Forms of apprenticeship

In 2011 the Apprenticeships, Skills Children and Learning Act 2009 (ASCLA 2009) came into force in England and Wales which provides broadly two legal forms of apprenticeship;

  • a Contract of Apprenticeship, and
  • an Apprenticeship Agreement.

The apprentice will be an employee under both forms of apprenticeship, but the employer will have certain additional responsibilities for an apprentice employed under a Contract of Apprenticeship, particularly relating to terminating the apprenticeship.

Contract of Apprenticeship

Prior to the introduction of ASCLA 2009, the status of an apprenticeship was governed by case law, with the Court of Appeal finding a modern apprenticeship could still constitute a common law contract of apprenticeship as long as it satisfied traditional criteria relating to the duration of the contract and the employer’s obligations under it.

As a general rule, a Contract of Apprenticeship is the default legal position, and this will exist where you and an apprentice entered into a work-based training programme but no or no ASCLA approved written agreement is entered into.

Under a Contract of Apprenticeship, you are required to employ an apprentice until they have been trained to the agreed level. It is particularly difficult for employers to fairly terminate the apprenticeship prior to reaching the required qualification. Managing apprentices is made more difficult as the court guidance on when a Contract of Apprenticeship can be terminated is limited, i.e. where it is virtually impossible for an apprentice to complete their apprenticeship.

In the event of a wrongful termination an apprentice may not only have a claim for enhanced damages due to a loss of career prospects but also can bring a case in the County Court for up to 6 years from termination (as opposed to 3 months in an employment tribunal)

Apprenticeship Agreement

A traditional contract of apprenticeship is a contract under which the apprentice is bound to the employer in order to learn a trade, and the employer agrees to teach and instruct him. In an attempt to improve training for employment, the government first introduced a statutory scheme of apprenticeship agreements in 2011 under the Apprenticeships, Skills, Children and Learning Act 2009 ( ASCLA 2009). A simplified scheme was introduced from 26 May 2015, but the old scheme continues to operate under transitional provisions.

This form of apprenticeship seeks to balance the needs of the apprentice with the needs of the employer. Within this framework an apprentice has normal Employment Law rights as the contract is deemed to be a contract of service rather than a contract of apprenticeship. However, the agreement must satisfy certain conditions under ASCLA 2009 and be in a prescribed form.

There are four conditions required to qualify as an apprenticeship agreement which are:

  • The apprentice must undertake to work for the employer;
  • The agreement must be in the prescribed form, notably it must contain the basic terms of employment required to be given to the employees under Section 1 of the Employment Rights Act 1996. It must also include a statement of the skill, trade or occupation for which the apprentice is being trained under the relevant apprenticeship framework;
  • The agreement must state that it is governed by the law of England and Wales (as the legislation does not extend to Scotland and Northern Ireland);
  • The agreement must state that it is entered into in connection with a qualifying apprenticeship framework.

If any agreement is not in the correct format the protections of the ASCLA will not apply. Members of the RMIF have access to template agreements on the RMIF website, so we would strongly suggest that you use one of the approved formats in addition to any training agreements when taking on an apprentice.

Employers will still need to take care when dismissing apprentices under this type of apprenticeship where those apprentices have acquired sufficient continuous service for Employment Law rights. Once the apprentice has acquired two years’ employment then the employer will need to be able to demonstrate both a fair reason

We would certainly recommend that all apprentices are placed on an apprenticeship agreement.

Note the ASCLA does not apply to Scotland and Northern Ireland,

Training agreements

When employing an apprentice an employer can either arrange training programme themselves or enlist the aid of a third-party service who can assist with funding and arranging college courses. However, it is arranged most colleges will look to enter into a training agreement between the college the employer and the apprentice.

It should be noted that this is designed to govern the training requirements of the apprenticeship. It is not a replacement for an apprenticeship agreement between the employer an apprentice.

Again, members of the RMIF are strongly advised to utilise the template agreements on the RMIF website in addition to any training agreements.

Wages

Since 1st October 2010 apprentices have been entitled to a national minimum wage rate. Due to the apprentice’s reduced skill this rate is proportionately lower. The current apprentice rate is £3.90 and applies where the apprentice is under 19 or over 19 and in the first year of their apprenticeship.

It should be noted that as the employer you will be liable for pay whilst the apprentice is at college.

Conclusion

Apprenticeships are a common and useful tool and allow employers to provide training and pass on their knowledge to the next generation. However, you will still need to take care when considering an apprenticeship. How an apprenticeship is set up will determine how easily it is to manage the apprentice, the training and if necessary, any disciplinary actions including dismissal.

Covert Recordings

“I held a disciplinary meeting with one of my employees last week and, having sent him the notes I made, he has now revealed that he covertly recorded the meeting and says that he contests my record of the meeting. Is there anything I can do to stop this?”

Covert recording is an increasingly common phenomenon in the modern workplace. The development of technology, in particular recording Apps on mobile phones, has meant that many employees now try to record meetings and then use that evidence against their employer if there is a dispute.

There are a couple of areas to consider in the above scenario:

a) Firstly, covert recording can be a serious disciplinary issue. It certainly has the potential to undermine trust and confidence and further, since the introduction of the GDPR, the unauthorised recording of another individual also causes data protection issues, given that the Manager who is taking the meeting has had his or her voice recorded without consent. Furthermore, there can be further problems with data security if the recording is then taken off site.

b) Employers are advised to make clear in disciplinary policies that covert recording is a serious disciplinary offence and some employers may choose to include it as one of the examples of gross misconduct in their disciplinary procedures. Doing so will strengthen an employer’s hand if, as in the above scenario, the employee then covertly records meetings knowing that they are in breach of such a policy.

c) Employers should be aware however, that when matters end up in the Employment Tribunal, even if there are covert recordings, Tribunals will often choose to hear or see the transcript of the recording if the matters are broadly relevant to the matters before the Tribunal claim.

That won’t always be the case in litigation, employers can apply to have such information excluded and it can depend upon the purpose of the recording. In a case this week, the Employment Appeal Tribunal has given a decision (Phoenix House v Stockman) noted that covert recording is usually a misconduct issue. It also noted the variety of purposes for making a covert recording, which are likely to be taken into account when considering whether the matter is misconduct and whether, if it ends up in the Employment Tribunal, covert recordings should be excluded. The purposes of the recording can, for example, be anything from entrapment, to an employee genuinely guarding against unfair or discriminatory treatment, having previously experienced the same.

What if an Employee asks to record the meeting?

Another scenario often faced by employers is where an employee asks if they can record the meeting in advance. Whilst it is acceptable for an employer to have a policy that it is not allowed, given that a recording is a completely neutral record of the meeting, employees who are seeking to bring claims against the employer can try to draw an adverse inference from an employer’s refusal to have a meeting recorded.

To overcome this issue, some employers are introducing policies whereby the employer records the meeting and keeps the data secure at the Company premises and provides one copy to the employee. This means that both employer and employee have a neutral recording of the meeting, from which a transcript can be made if matters end up in a dispute.

Right to be accompanied at disciplinary/grievance hearing

“An employee has requested that they have an interpreter at a disciplinary hearing because they do not understand English. Do I have to allow this?”

Under Section 10 of the Employment Relations Act 1999 (ERA 1999) an employee who is required or invited by an employer to attend a grievance or disciplinary hearing and makes a reasonable request to be accompanied has the right to be accompanied at that hearing.

The employee may choose the person they wish to accompany them provided that it is:

  • Another of the employer’s workers, or
  • A trade union official who is employed by the trade union or certified in writing by the union as having experience or training in relation to acting as a worker’s companion at disciplinary or grievance hearings.

There is no right under Section 10 ERA 1999 to be accompanied by another type of person. For example, an employer is not required to allow a worker to be accompanied by:-

  • A friend or a family member who does not work for the employer
  • A legal representative

Consideration should also be given to:

The EHRC statutory Employment Code of Practice gives the following examples:-

  • As an example of an ‘auxiliary aid’, provision of a sign language interpreter or support worker for a disabled employee (para. 6.13)
  • As an example of steps, it might be reasonable for an employer to have to take (reasonable adjustments), provision of a reader or an interpreter (para. 6.33)

The ACAS guide to discipline and grievances at work recommends that employers should:

  • Consider the provision of an interpreter or facilitator if there are understanding or language difficulties (e.g. a friend of the employee, or a co-employee). This person may need to attend in addition to the companion though ideally one person should carry out both roles.
  • Consider arranging for an interpreter where the employee has difficulty speaking English.

The ACAS guidance (unlike the ACAS Code of Practice) has no statutory authority. However, in the event of uncertainty regarding the Code of Practice, it may be followed by Tribunals.

Conclusion

It is important that employers carefully consider whether it is appropriate to provide an interpreter during disciplinary and grievance hearings to minimise risks around potential claims for disability discrimination and/or race discrimination.

Abandoned Vehicles

“I have repaired a vehicle and it is ready for collection but all I have is a telephone number and the owner is now not responding, what can I do”

First things first, your options are limited if you do not have an address as any of the processes will require you to write to the owner. Now is the time to review your processes and re-iterate the point to all staff that no work should be instigated without confirmation of a name and address.

Ok, so how do you get it if you don’t have it?

Stage 1 – obtaining the keepers details

The DVLA can release details of the registered keeper of a vehicle if you can satisfy them that you have a legitimate need for the information. As a company you need to contact the DVLA and request V888/2A. You will be required to confirm your details and provide a quick explanation as to why the information is required. It should be sufficient to confirm brief details of the contract and the fact that you require the information in order to pursue legal proceedings. The fee for this is £2.50 per vehicle and you should receive a response within a few weeks.

More information and an electronic version of the form can be found at www.gov.uk/request-information-from-dvla

Stage 2 - initial contact

Once you have the address you need to send a letter to the owner requesting payment. It is now time to consider whether you will pursue the matter through court or whether you can sell the vehicle under the Tort Interference With Goods Act 1977

Taking the owner to court - If you are owed money for a repair or diagnosis but the owner doesn’t agree then you will have to take the matter to a Judge in order to get a definitive answer. A court is capable of deciding who is right and how much is owed. Once this is decided then the court will be able to seize the vehicle and sell it to settle any debts. However, you have to be warned that a court Order only states that money is due, not that the owner has the money to pay. As you will incur court fees on top of any Judgment, this should be considered.

Selling the vehicle - You cannot just sell someone’s property because it is on your premises or because you are owed money. DO NOT apply to the DVLA to become the registered keeper. You are not the legal owner and will become liable for any TAX.

If you have carried out work that increases the value of the vehicle and the owner is in agreement that the money is owed but cannot, or will not come to pay for it, then you have the ability to require the owner to collect the vehicle and pay within 14 days, and if this doesn’t happen you can then sell the vehicle to settle the debt provided you give him 3 months’ notice. There are a number of requirements to get this right so we would strongly advise you discuss this with us so that we can take you through the steps required.

Stage 3 - The letter

Either way you will need to write to the owner in order to try and resolve the matter amicably. Any letter should clearly establish what it is you want them to do and why it is you believe they are liable. You should include a copy of any invoice as well as a deadline by which to respond. This should be at least 14 days but can be more.

Don’t forget to carefully document all conversations and to evidence all telephone calls, emails and letters for future reference. Also, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situation above, contact us at any stage for advice and assistance as appropriate.

Deposits

Here we look at what happens to deposits paid by customers where finance documents are not signed and also when they are signed.

Finance Documents not signed

When a vehicle is sold subject to finance, you are not entering into any contract with the customer directly. You are in effect acting as agent for the finance provider.

The contractual relationship will be created between the customer and the finance provider once the finance documentation is signed. That is why if a customer with finance funding wants to reject a vehicle, they have to reject to their finance provider and not you.

So even if a deposit is taken by you, this will not create a contract between you and the customer. If the finance documents are never signed (e.g. customer changes their mind or declined finance) no contract will exist between the customer and finance provider.

If no contract exists, you cannot retain the deposit as you have no right to do so as you have no contract with the customer.

Furthermore, Section 70 of the Consumer Credit Act 1974 states that any finance agreement which is contemplated or withdrawn from entitles the debtor (customer) to be repaid any sum paid under or in contemplation of that agreement.

For Example

MILS had a case where a deposit was taken by debit card of £500 for purchase subject to finance. Customer was told deposit was non-refundable. Customer was subsequently declined finance. Dealer would not return deposit claiming the customer knew it was non-refundable. Customer sued and won. Got back deposit, interest on it and all court fees paid out. Ended up costing dealer £800.

Finance Documents signed

A Consumer Credit Directive from Europe dated August 2010 and implemented in England and Wales on 1st February 2011) provides additional right to customer to withdraw from any Hire Purchase agreement once it is signed.

It states that a consumer can withdraw from a hire purchase agreement for no reason at all by giving written or oral notice within 14 days of signing up to it. This means any payment made to you by the finance provider will have to be repaid to them. However, the customer is still bound to proceed with their purchase by some other financial means.

If the customer does not proceed, you can sue them for your losses incurred as a result of their breach. However, you can still not retain their deposit due to section 70 of the Consumer Credit Act 1974 mentioned above. You have an obligation to mitigate your loss so you would need to re sale the vehicle at the best market price and then sue for any losses following from the same. You have to prove and justify the losses with evidence.

For Example

MILS had a case where the customer gave 14 days’ notice of cancellation of his HP agreement. He did not go through with the purchase by other means. The client re sold the vehicle and sued the customer for storage charges, maintenance charges, advertising fees and loss of profit and obtained Judgment on all sums claimed.

As always, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situations above, contact us at any stage for advice and assistance as appropriate.

Conclusions

Don’t forget, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situation above, call the direct member helpline or 0845 305 4230 at any stage for advice and assistance as appropriate.