At Watermark we are seeing an influx of Covid-19 related employment issues from both employers and employees. There are some common trends emerging, which we have explored in more detail below. If you have any other Covid-19 related employment issues, please get in contact with us for a no-fee consultation – we would be happy to assist.
Below we have set out three of the most common covid-19 related employment questions asked by employees, which we have answered in general terms. Whilst we have addressed them from an employee’s perspective, the answers are useful as an employer also.
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Can my employer reduce my pay to 80%?
An employer cannot reduce your wages or salary without your consent. Doing so gives rise to two potential claims, set out below:
Wages Protection Act 1983
Wage or salary reductions are covered by the Wages Protection Act. Section 4 of the Wages Protection Act provides that where wages or salary become payable to a worker the entire amount must be paid to the worker without deduction. As recently noted by the Employment Relations Authority in Raggett And Ors V Eastern Bays Hospice Trust T/A Dove Hospice, terms of employment relating to remuneration cannot be unilaterally varied by the employer, and “a failure to pay full or part payment of wages due under an employment agreement is a deduction within the meaning of the Wages Protection Act.”
Personal grievance
Furthermore, reducing your pay without consent amounts to a unilateral variation of your individual employment agreement. This gives rise to grounds for a personal grievance for disadvantage. In short, a disadvantage claim simply means that a term of your employment has been breached, causing you to be disadvantaged.
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Can my employer force me to take annual leave?
Annual leave is governed by the Holidays Act 2003. Section 18(3) states that “When annual holidays are to be taken by the employee is to be agreed between the employer and employee.” An employer cannot unilaterally decide when an employee will take their annual leave except for the limited circumstances detailed in section 19 of the same act (below). An employer may give notice to an employee to take annual leave only where the employer and the employee have been unable to agree when the leave should be taken. The employer, per section 19(1)(a) must then give the employee 14 days’ notice that annual leave is required to be taken.
Therefore, an employer must first seek an employee’s agreement to take annual leave; and only when this fails can they give 14 days’ notice that leave is to be taken. If such notice is not given, an employee is not obliged to use their leave.
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Is Covid-19 a reason to be made redundant?
Covid-19 in and of itself is not a reason for redundancy. The correct legal process must still be followed to the letter to avoid grounds for a personal grievance claim arising.
For a redundancy to be valid at law, there are two components: The justification and the ensuing process. Firstly, there must be a “genuine commercial justification” for the redundancy. This means that an employer cannot simply say “our revenue has dropped as a result of Covid-19, your position is now redundant”.
Secondly, the law takes a robust approach to the process to be followed in a redundancy scenario. It is not sufficient to inform an employee that they are now redundant (this would show that the outcome was predetermined).
The short point is that Covid-19 may be the cause of a genuine commercial justification for redundancy, nevertheless the law also sets out a prescriptive process which must be followed by an employer when proposing to make a position redundant.
The Covid-19 situation raises difficult and unique challenges for both employers and employees.
We are happy to discuss your situation with you. Please contact the Watermark team directly to make an appointment.
Erin Drew
Solicitor
09 532 8211