IGA News

Be Aware - July 2021

Be Aware - July 2021

30 June 2021

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 that 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 £4.30 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.

Owner supplied parts

Motor traders are regularly asked by owners to fit parts they have not supplied. Should a motor trader fit parts they have not supplied and if so what are the legal ramifications?

Who is liable for any parts fitted?

When fitting any parts, the Consumer Rights Act 2015 require these parts to be fitted as agreed:

  • with reasonable care and skill
  • in a reasonable time if no specific time agreed
  • for a reasonable charge if no price was set in advance

Where the garage also supplies the parts they are under an additional duty as the Consumer Rights Act 2015 will hold the motor trader liable for the parts as well as the fitting. Any parts must be:

  • of satisfactory quality
  • fit for purpose
  • match any description given

Should a repair fail then the motor trader will be liable to repair or replace the parts concerned if the parts are faulty or if they have been fitted incorrectly.

Parts supplied by the owner of the car

The difficulty with owner supplied parts is establishing the reason for the failure. If the failure cannot be easily diagnosed there is a risk of liability by default as by definition the garage will be intimately linked to the failure.

Where a part is supplied by the owner the garage is not liable for the part; only the fitting and any diagnosis carried out. Should the part prove to be incorrect, or faulty then this is an issue for the owner themselves.

The garage will remain under a duty to diagnose any fault and fit any parts correctly. This will include exercising a reasonable level of care and skill. If the part is obviously wrong or inappropriate, then this will need to be brought to the owner’s attention and specific instructions sought.

Conversely, where a garage supplies and fits any parts the likelihood of the garage being liable for any failure increases as the garage is also liable for the part itself. The difference is that a parts failure is usually covered by a supplier’s warranty allowing the garage to seek a contribution or indemnity from their supplier. The quality of parts as well as the ease of dealing with any issues can be a major consideration for most motor trader when choosing a parts supplier.

EU & Overseas Employees

“We left the EU on 30 December 2020, but I hear something is changing with EU workers on 30th June 2021. That’s only a month away, so what do I need to do?”

All prospective employees should undergo a Right to Work check, regardless of whether they appear to be from the UK, from the EU or from any other country. There are civil and criminal penalties for employers who fail to do so. Right to Work checks can be carried out in a number of ways, most commonly manually or via the online system at Gov.Uk.

Applicants for employment must produce a document from ‘LIST A’ which proves an indefinite right to live and work in the UK, or ‘LIST B’ which confers a limited/conditional right to stay and work.

When the UK was a member of the EU, all EU citizens (and indeed the wider EEA – European Economic Area, plus Swiss nationals) could live and work in the UK without restriction. Provision therefore of an acceptable document to the Home Office to demonstrate EEA/Swiss nationality was a ‘LIST A’ document and carrying out the check in the right way, as prescribed by the Home Office, would ensure that they could live and work in the UK permanently.

Up until 30 June 2021 (so not long now) the latest government guidance says that a prospective employee from an EEA country can still provide the evidence of nationality under LIST A and if the Right to Work check is undertaken correctly, then the employer can maintain what is known as the “statutory excuse,” which means that even if the employee was later found to be illegally working, as long as the employer did not know or have good cause to suspect they were illegally working, then they should escape liability.

After 30 June 2021, that situation for EEA citizens will change:

Provided the prospective employee from the EEA country has applied for Settled Status under the European Union Settled Status scheme (EUSS), then a document will be issued verifying EUSS status (and that should appear on the Home Office online checking system). People with EUSS status can live and work here indefinitely as before, just as they could when we were in the EU. To obtain Settled Status, an EU citizen has to have been living in the UK before 30 December 2020 and have applied successfully under the scheme (closing date 30th June 2021).

If they were not living here before 30 December 2020 and if they don’t have settled status, then they will need the appropriate Visa or Permit under ‘List B’ of the Home Office list of documents (which confer a limited/conditional right to work).

Note: we are also expecting further government guidance before July, so watch this space.

There are exceptions to the above, as immigration rules are complex, so seek advice if needed.

Court of Appeal: it is the date of the alleged discriminatory act from which the long-term effect of an asserted disability is to be assessed.

In All Answers Ltd v W, and R, the claimants alleged that they were subjected to acts by their employer in August 2018 which gave rise to disability discrimination. Both claimants argued that they were suffering from depression and anxiety and that these impairments met the definition of a disability for the purposes of the Equality Act 2010.

Section 6 of the Equality Act states that a person has a disability if they have a physical or mental impairment which has a substantial and long-term adverse effect on their ability to carry out normal day-to-day activities. Schedule 1 of the Act states that an impairment is ‘long-term’ if it has lasted or is likely to last 12 months.

The employment tribunal decided that both claimants were disabled finding that the effect of their mental impairment was long term, and that they remained disabled at the time of the hearing in October 2019. The employer appealed to the Employment Appeal Tribunal who dismissed the appeal.

In deciding whether the effect of the impairment was likely to last 12 months, the employment tribunal ought to have made that assessment by reference to the dates of the alleged acts of discrimination. The EAT found that although the tribunal had not focused on those dates, it had properly considered the issues by looking at the effect of the impairments both before and after the alleged discriminatory acts to show that they were long term.

The Court of Appeal allowed the employer’s appeal finding that the assessment as to whether the impairments were likely to last 12 months had not been done with reference to the facts which existed at the date of the alleged discriminatory acts. The Court referred to the “marked absence” of any reference to that date and stated that any events which occurred after it were not relevant in assessing the 12 month likelihood.

The Court noted that the tribunal’s judgment was written in the present tense and that the phrases “Is Mr W disabled”?; “He suffers” from a mental impairment; “Is clearly long term;” disabled “and remains so” – further indicated that the issues had been looked at as at the date of the hearing and not at the relevant date.

The Court of Appeal has referred the case back to the employment tribunals to undertake the proper assessment.

General Note

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, contact us at on 01788 225 908 any stage for advice and assistance as appropriate.