Be Aware - July 2017
Energy Performance Certificates: England & Wales
It’s been coming for some time now but from April 2018 any non-domestic property let out will need to have a minimum energy performance rating of E on an Energy Performance Certificate (EPC).
The regulations will come into force from 1st April 2018 for new lets and renewals of commercial tenancies and from 1st April 2020 for all other tenancies. It will be unlawful to rent a property which breaches the requirement for a minimum E rating
An (EPC) rates how energy efficient your building is using grades from A to G (with ‘A’ the most efficient grade). Figures suggest that approximately 35% of properties surveyed between 2008 and 2015 were achieving an E, F, or G rating.
As these regulations form part of the devolved administrations responsibilities we will look at the application of these in each country, starting with England & Wales
The Energy Act 2011 defines a non-domestic property as:
(i) is situated in England and Wales,
(ii) is let under a tenancy, and
(iii) is not a dwelling
This is quite a wide definition and is likely to cover all commercial property types from A1 – D2 usage classes unless exempt.
You don’t need an Energy Performance Certificate (EPC) if the building is:
(i) listed or officially protected and the EPC requirements would alter the building to an unacceptable degree
(ii) it is a temporary building which will be used for less than 2 years
(iii) it is a place of worship, or other religious activities
(iv) an industrial site, workshop or non-residential agricultural building that doesn’t use much energy
(v) a detached building with a total floor space under 50 square metres
(vi) due to be demolished by the seller or landlord
This is still, unclear. The most important factors will be:
(i) Whether the Landlord and Tenant Act 1954 is excluded from the lease
(ii) Who is liable for dilapidations and property maintenance.
The Landlord and Tenant Act 1954 governs the rights and obligations of landlords and tenants of premises which are occupied for business purposes. Where applicable the Act guarantees that the tenants have the right to stay in the premises at the end of their tenancy; and to also apply for a new lease to be granted.
There are only limited rights of cancellation under this Act. It is likely that the landlord would only be able to use a failed EPC rating where:
(i) The tenant was responsible for the maintenance of the building and had failed to maintain it
(ii) That suitable alternative property was offered
(iii) Where the landlord intended to demolish the building
However, who will be responsible for the upgrades required cannot be determined at this time.
As this will only apply for new and renewed tenancies from 1st April 2018, where your lease was either started, or was renewed before 01 April 2018 you will have either the balance of any tenancy or until 1st April 2020 to deal with any EPC issues.
The issue will be where commercial landlords attempt to use a failed EPC as grounds to end a lease. What will happen will be determined by your lease and as such you will need to have this reviewed in the event of a dispute. Only one thing can be guaranteed and that will be that any such dispute will be very difficult to deal with and you will need to obtain legal advice at the earliest opportunity. 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.
The Return of an Employee from maternity leave
“We have a lady on maternity leave who is due to return to work shortly. We replaced her with a full-time employee and now her original position has been swallowed up. Initially we were thinking she could come back to the same role however another role has potentially arisen in one of our other dealerships. There is no mobility clause in her contract however can we offer her the alternative role? If she says no to the relocation would that mean she is effectively resigning from her role?”
Care should always be taken with employees returning from maternity leave because of the risks of both maternity discrimination and sex discrimination. Employees who take maternity leave are entitled to return to the same position however when they are in the additional maternity leave period (i.e. the last six months of their maternity leave) they are still entitled to return to the same position, unless that is not reasonably practicable for them to return to the same job. If that is the case they are entitled to return to a different job which is both suitable for them, appropriate in the circumstances and, on terms and conditions not less favourable than they would have been had she not been absent.
Turning to look at whether it is not reasonably practicable, there is no strict legal meaning but case law provides examples. For example a whole department moving to another site and therefore the work not being available would likely qualify. On the other hand, an employer who hires a temporary worker who was so good they were then made permanent, and sought to move the incumbent employee on her return, was not deemed to be reasonably practicable.
Ordinarily therefore if her original role is available she should be put back into that. You can consult with her and see if she would be agreeable to relocating and then move her if she agrees. If, however the original role is not available the question is whether the alternative role is suitable for her and on not less favourable terms
In summary therefore a genuine business reorganisation might suffice but a simple preference for someone else to perform the role would not. In those circumstances if she is not agreeable to the move therefore there could be a risk of discrimination. If she refuses equally it would not mean she has returned and the company would either have to put her back into the original role or, force the move and risk both a breach of contract and potential discrimination situation.
Holiday Pay – Latest News
The Employment Appeal Tribunal (EAT) has again been asked to consider when a claim can be made for the underpayment of holiday following the case of Bear Scotland v Fulton and another  IRLR 15, which established that claims for underpaid holiday should be brought within three months of the last of a “series of deductions”.
The EAT, in the most recent hearing, reviewed this position and determined that there was no significant reason for departing from the earlier judgment.
This means that an employee will still be restricted from making a backdated holiday pay claim if there has been a gap of more than 3 months between any subsequent underpayments.
This is obviously very good news for employers as the decision provides greater certainty for those seeking to ensure they are correctly calculating holiday pay and any subsequent claims that may arise.
This advice is general in nature and it 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 on 0845 305 4230 at any stage for advice and assistance as appropriate.