Taking On Staff? Doing So Prematurely Can Have Serious Consequences

Taking on staff is often a necessary precursor to setting up a new business. As an Employment Tribunal (ET) decision showed, however, entering into any form of binding employment relationship is a serious step and doing so prematurely can have grave financial consequences.

The case…

Mar 10, 2021

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Taking on staff is often a necessary precursor to setting up a new business. As an Employment Tribunal (ET) decision showed, however, entering into any form of binding employment relationship is a serious step and doing so prematurely can have grave financial consequences.

The case concerned an entrepreneur who set up a security company with a view to providing lucrative services to a high net worth individual who intended to visit the UK. Two days after its incorporation, the company entered into an employment contract with an acquaintance of the entrepreneur. He was taken on as a trainee close protection driver at a gross salary of over £2,000 per week.

The high net worth individual, however, decided not to use the company’s services and its business never got off the ground. As a result, the employee had been offered no work and had not been paid. He complained to an ET that unlawful deductions had been made from his wages.

Upholding his claim, the ET noted that he had left his previous job in order to join the company. He had neither resigned nor been dismissed and therefore remained the company’s employee. The fact that he had done no actual work for the company did not affect his contractual entitlements. The company was ordered to pay him £44,352, that sum representing 22 weeks’ salary.

HMRC are Clawing Back Furlough Payments Made in Error

It will come as no surprise to hear that HM Revenue and Customs (HMRC) is making stern efforts to claw back sums paid in error under the COVID-19 furlough scheme. As one case showed, however, that process has left some reputable and entirely honest employers caught between a rock and a hard place. The case concerned two workers who started employment with a furniture company in late February 2020. Because they were taken on so late in the month, they were not paid for the first time until 26…

Man Who Worked for Membership Association Was an Employee

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Dismissal of a Disabled Employee is Tough to Justify

It is possible objectively to justify an employee’s dismissal for reasons related to his or her disability. However, as a case concerning an autistic university analyst made plain, establishing such a justification is, to say the least, a demanding task. The man, who had been diagnosed with high-functioning autism, was on long-term sick leave, suffering from stress, when he was dismissed. After he lodged a disability discrimination claim with an Employment Tribunal (ET), the university accepted…