Business Brain: Navigating legal minefield of hiring seasonal staff
With the festive season around the corner, many businesses will start thinking about whether they need additional staff. The use of temporary resources can be useful for employers when the nature of work available is uncertain or short-term, but managing temporary resources can be a legal minefield.
Many employers think that because they use fixed term or specific purpose contracts, the Unfair Dismissal Acts 1977-2007 do not apply. This is not always the case. The legislation does provide exemptions once the following conditions are adhered to:
* The contract is in writing.
* The contract specifically states that the legislation will not apply to a dismissal consisting only as a result of the end of the contract arriving.
* The contract is signed by both the employer and the employee.
If the contract is continuously renewed then it will not be possible to keep avoiding the legislation. Also, if the employee has the requisite employment service and the dismissal is not simply because the contract expired, they will have unfair dismissal rights.
The legislation also prevents employers from avoiding rights under the acts by giving employees a series of fixed-term contracts. An employee can claim for unfair dismissal if they have been employed on more than one fixed-term contract and the gap between contracts is less than three months and the last contract was granted in an attempt to avoid liability under the unfair dismissals legislation.
This means employers need to be careful about how they draft their contracts and how many they use.
Employers also need to be aware of the Protection of Employees (Fixed Term Work) Act 2003. This offers significant protection to temporary employees and prevents them being employed for the long-term on a series of successive contracts.
Temporary employees can only be treated less favourably in relation to their terms and conditions of employment where such treatment can be justified on objective grounds, or if it is for the purpose of achieving a legitimate objective of the employer. These are very difficult tests for an employer to satisfy.
The legislation means that there is a limit of four years on how long these contracts can be renewed for once there are two or more contracts. Any renewal must set out in writing in advance for the employee the objective reason why a permanent contract is not being provided. Renewal can only occur for objective reasons and again this can be a very difficult test for an employer to satisfy.
Employers considering using agency workers for the holiday season also need to be aware of the Protection of Employees (Temporary Agency Work) Act 2012. This provides that agency workers are entitled to receive the same basic working and employment conditions as they would have received had they been directly hired.
If the end user has not provided the agency with the relevant information, then they are required to indemnify the agency for any loss attributable to their failure.
All of the above highlights that while many businesses consider temporary workers a 'quick fix' to a resourcing issue, their use brings a raft of potential legal consequences that should be considered.
Linda Hynes is an associate with Leman Solicitors