Understand Your Rights. Solve Your Legal Problems
Last week began the implementation of Section 24 of the Finance Act 2015 (No. 2), which will affect UK landlords with personally owed mortgages.
Announced in July 2015, the legislation will restrict mortgage interest tax relief for individuals renting out residential property and follows a raft of measures aimed at controlling the unprecedented growth of the buy to let sector over the last two decades. Since April 2016 second home purchases have also been subject to a 3% stamp duty surcharge and, in January of this year, tighter borrowing requirements under Prudential Regulation Authority (PRA) criteria has resulted in higher deposits and more stringent rental stress testing.
Although many landlords are broadly aware of Section 24, many have yet to engage in a detailed evaluation of their own tax position moving forward.
What Landlords Should Know About Section 24:
A frustrated Judicial Review attempt and a new Chancellor seemingly with little intention of backtracking, the chances of policy reversal look unlikely for foreseeable future. Nonetheless, our general advice is not to overly panic as there is still plenty of time to make sure your tax affairs are in order. Some options worth exploring include reducing the amount of debt secured against the properties, transferring properties to a spouse / partner or simply selling up to release equity. Larger portfolio owners may also consider transferring properties into a Limited company structure and subsequently refinancing (provided a thorough cost-benefit analysis has been undertaken and any strategy has been confirmed with the HMRC).
Above all, it is very important to speak with a suitably qualified accountant and/or tax advisor.
(Source: Property Solvers)
The highly controversial Foreign Account Tax Compliance Act is a monumental failure for the public purse and a "windfall of corporate welfare for compliance industries," warns Nigel Green, CEO of deVere Group and Co-Founder of the Campaign to Repeal FATCA.
Citing research from William Byrnes, a law professor at Texas A&M, Mr. Green debunks the IRS claim that it has helped to collect $10 billion since 2009 from "taxpayers coming back into compliance." In his report Byrnes, as Mr. Green notes, believes FATCA's net recovery could be as low as $100 million and the law could "soon cost more than it brings in".
"That isn't enough to fund the federal government for more than half an hour. It is far less than was expected at Fatca's enactment, since the law was scored as bringing in $800 million a year, writes Mr. Green. "That meager gain must be weighed against the law's costs. Fatca adds one more onerous and expensive reporting obligation for American taxpayers who hold any asset abroad."
Mr. Green further points out the duplicative nature of FATCA, as its reporting mandates are similar to the Report of Foreign Banks and Foreign Accounts, and its draconian penalties for error.
In his op-ed, Mr. Green also references a 2014 Thomson Reuters survey of 300 financial institutions, which found "27% expect their spend on FATCA compliance in 2015 to cost between $100,000 and $1million." The Wall Street Journal, as Mr. Green notes, reported that the five largest banks in Canada spent nearly $700 million on initial FACTA costs.
An estimated 250,000 foreign financial institutions are impacted by FATCA's reporting requirements according to a citation in his report. One representative of a large Spanish bank decried the high costs of compliance could range from $8.5 million for a local bank branch to $850 for a global financial institution. Estimates of the costs to U.K. financial institutions range from $1.1 billion to $1.9 billion, with annual costs ranging between $60-100 million.
"Thus there are plausible projections that the law's aggregate global cost is anywhere from $60 billion to $170 billion," stated Mr. Green. "That money comes out of the pockets of consumers, depositors and perhaps shareholders."
Last month, Mr. Green warned $1.5 million US citizens in East Asia may renounce their citizenship according to a poll conducted by deVere Group and its Hong Kong division Acuma.
(Source: Repeal FATCA)
According to a recent survey of midcap UK companies 65% of professional service firms are moving forward with their Brexit plans now Article 50 has been announced - leaving other industries trailing in their wake with an average of only 53% of firms across other industry sectors now engaged with planning.
The survey, sponsored by The Brexit Tracker, noted professional services were less likely to sit on the fence when it came to assessing the impact of Article 50 on their business with 42% of firms believing Article 50 will be good for business and only 25% of respondents feeling their might be no or little change while in other sectors positivity waned to 35% and ambiguity rose to 40%.
Ben Martin, MD for The Brexit Tracker said: “It’s great to see that so many in professional services have grasped the nettle and are moving forward with Brexit planning and clearly have a good grasp of how it will impact their firm.
“More concerning though is how industries such as retail, construction and engineering who one would think are heavily Brexit-dependent for resource and supply chain are yet to fully engage with the planning process, as it may be these firms that are actually the most exposed to Brexit outcomes.”
The Brexit Tracker analyses 390 economic indicators pertinent to the sector and a firm’s particular circumstance. Stakeholders can view their Brexit dashboard and understand likely implications for their business. They can also compare their views with those of their peers. The tool enables expensive resource to be smartly invested in strategic planning, not squandered in trying to make sense of a myriad of factors that may or may not be relevant to the business.
(Source: The Brexit Tracker)
Following the announcement of the SFO's deferred prosecution agreement (DPA) with Tesco a few weeks back, international business & law journalist Dominic Carman here discusses for Lawyer Monthly whether DPAs are truly in the interest of justice.
Imagine if you defrauded HMRC for a large sum, say £500,000, and then you were caught, sent for trial and found guilty: you would expect to receive a lengthy prison sentence. Similarly, if you offered a hefty bribe to an MP, a company director, or a public official, you would expect the same treatment. As individuals, we are all equal before the law. But perhaps some are more equal than others, especially if you are a major public company being investigated and prosecuted by the Serious Fraud Office (SFO).
As constituent members of the FTSE100, Rolls-Royce and Tesco are household names: standard bearers of British excellence in the automotive and retail sectors, employing more than 500,000 staff between them. As companies, both have also admitted their corporate guilt as part of Deferred Prosecution Agreements (DPAs). Introduced in 2014, a DPA is an agreement reached between the SFO and an organisation which could be prosecuted, under the supervision of a judge. This allows a prosecution to be suspended for a defined period provided the organisation meets certain specified conditions.
The most notable element is a large fine. In January, Rolls-Royce paid £497.25m after admitting bribery and corruption in multiple jurisdictions. Meanwhile Tesco is hoping that its DPA, involving a fine of £129m for overstating profits by £263m in its annual accounts, will be approved within days in the High Court by Lord Justice Leveson. Some commentators are cynical, suggesting that DPAs allow big corporations to buy their way out of a criminal trial and that the SFO is not serious enough about bringing difficult prosecutions.
However, when approving the Rolls-Royce DPA, Leveson made it clear that future criminal charges could still be brought against senior managers. But experience in the US, where DPAs have a long history, may suggest otherwise: few individual defendants are ever prosecuted following a DPA, fewer still ever go to jail. Indeed, since the first two DPAs were agreed in the UK - Standard Bank in November 2015 and an unnamed company in July 2016 - no individual relating to either case has been charged.
“DPAs give the prosecution certainty,” explains Nigel Rowley, Managing Partner of Mackrell Turner Garrett, who has acted for clients brought to trial in several SFO prosecutions. “The SFO works to a slide rule principle of how many defendants they can convict in a year - it gives them the certainty and removes the risk of a phenomenally expensive trial. It is therefore inevitable that the authorities have jumped on the DPA bandwagon. There is huge pressure put on prosecutors to gain a conviction.
“Anything the SFO can do to eliminate the risk of losing, they are going to embrace with great vigour. When you win as a defendant and you are acquitted in a prosecution brought by the SFO, the publicity that you give to the prosecution’s loss is phenomenal. That is the very last thing that they need, particularly in complex fraud cases that have huge knock on effects. Losing in court against Tesco would be such an enormous blow. They are desperate to avoid losing.”
In terms of the latest DPA, Rowley adds: “The logic of the agreement that the SFO has reached with Tesco is because the publicity that goes with it when they lose is so great. Why wouldn’t they try and resolve it instead? Doing a DPA loses the risk factor. I don’t think justice has much to do with that. It just removes risk from the authorities and puts £129m in the bank.”
At another firm, which has acted for multiple defendants in SFO investigations and prosecutions, a prominent partner says: “The advent of DPAs has allowed the state to do something it has been lamentably bad at doing: to use the criminal justice system as, potentially, an effective tool in the regulation of business. Unlike America, which has a long history of doing this, the UK is playing catch up in a dramatic fashion. The area that remains unresolved is holding senior individuals in large corporates to account. The UK has an appalling track record in doing that.”
It is noteworthy that three former Tesco executives have been charged with fraud and false accounting: Carl Rogberg, former UK finance director, Christopher Bush, former UK managing director, and John Scouler, former food commercial director. They will stand trial in September. Meanwhile former chief executive Philip Clarke and former group commercial director, Kevin Grace, who had been investigated, will not face charges.
This is something of a first. In the multiple Libor trials, involving rate rigging by banks to fix the London Interbank Offered Rate, all the guilty banks in the US entered into DPA agreements alongside settlements with the SEC. In the UK, the same banks entered into settlements with the FCA for sums running into hundreds of millions, but there was no prosecutorial settlement, i.e. no senior banker was prosecuted. The only individuals held to account in the Libor trials were relatively junior. Although some senior individuals have been interviewed, none has yet been charged. Indeed, no senior UK banker has been prosecuted for any of the fraudulent malpractice in the City that led to the financial crisis nearly a decade ago.
According to a senior figure close to the Libor investigations: “It is inconceivable on any rational analysis that the systemic manipulation of Libor did not go above a particular level within the banks concerned. It may be, evidentially, that the prosecution can’t get there – except for lowballing, when you go all the way up to the Governor of the Bank of England and the Cabinet Office. Then the evidence is everywhere. They were encouraging it because of the particular financial crisis they were then facing. In terms of the SFO, it was an entirely political decision as to who they went for.”
The case of BAE Systems provides a further example of political pragmatism overriding a serious breach of the criminal law. In 2004, the SFO started an investigation into suspected accounting irregularities relating to BAE and a government to government deal struck in 1985: Britain signed the Al-Yamamah arms for oil deal with Saudi Arabia, the biggest ever UK export contract involving the sale of 120 Tornado fighter jets.
Following a settlement agreement with the US Department of Justice in 2010, and a fine of $400 million, a settlement was then reached with the SFO: BAE Systems pleaded guilty to one charge of breach of duty to keep accounting records and paid a £30m penalty, some of which was distributed as a charitable payment for the benefit of Tanzania. Again, no individual was ever charged.
The justification for offering DPAs is to incentivise companies to co-operate fully with the SFO and to save public funds in administering justice. Just four DPAs have already delivered more than £650m to UK PLC with more set to follow this year. And they are cost effective for very big companies as a way of buying themselves out of trouble. “We see their commercial value to companies under suspicion,” said Ben Morgan, head of bribery at the SFO in a recent speech. But, counters one legal observer, “The SFO needs to be tasked with fairly fearlessly investigating issues, and not be susceptible to political pressure.”
Only then perhaps will those wrongdoers in positions of real power and influence finally face justice.
As the UK’s new Apprenticeship Levy came into force last week, Suzanne Horne, Head of the International Employment Law Practice at Paul Hastings, reveals to Lawyer Monthly she is sceptical that firms will have the motivation to overcome the bureaucratic and cultural hurdles required to make new apprentices a staple of the white-collar workforce in the UK.
New, world-class apprenticeship standards across 29 industries led by 1,200 trailblazing employers is a great sound bite. But, if the Apprenticeship Levy is to succeed in making apprenticeships a feature of the modern workplace, employers and society alike will need to be open to embrace a cultural change, as this legislation challenges traditional perceptions of where apprenticeships are appropriate and where they are not.
Only time will tell if employers can find a way to make the scheme work for them. However, with the prospect of a subsidy for small companies through a co-investment model, and the appetite of larger firms to claw back the costs of the levy, firms may find the motivation to tackle the bureaucratic and cultural hurdles required to make the new apprentices a staple of the white-collar workforce in the UK.
That said, the levy is not without its faults. Some devolved nation MPs have referred to it as a ‘UK Government employment tax’. UK employers with a cross-border workforce will need to manage the different administrative arrangements for funding for each devolved nation. Some industries that are reliant on apprentices, such as construction, engineering and film, already pay a levy and are now facing the prospect of paying a second cost on top. What’s more, larger employers are effectively subsidising government policy. Each large employer with an annual payroll bill of over £3m pays the 0.5% levy, but only one will be entitled access to the £15,000 allowance. For these companies, it will be hard to view the levy as anything more than an additional tax on their payroll.
A new school which aims to combat child prostitution by teaching the victims law opens its doors last week in a world first.
The School for Justice in India will take underage girls out of the country’s brothels and train them to be lawyers and prosecutors with the power to ensure the criminals who force them into sex work are punished.
It has been set up by the Free a Girl Movement together with one of India’s most respected law universities and is both a physical school and an education programme. It will offer the support, tuition and mentoring that the girls need to reach university level.
After that, the girls will spend five years studying to get to their Bachelor of Law – and ultimately become public prosecutors to challenge India’s legal system from within.
Initially, 19 girls are being taught in the School of Justice, though this is poised to increase, and a class for 2018 is already in the making.
Asha, one of the first students at the School for Justice, said: “I want to become a lawyer, because I want to fight against child traffickers.”
India has the most underage sex workers in the world with an estimated 1.2 million children working in brothels against their will. These girls, some as young as seven years old, are abducted from their homes, sold to human traffickers and often tortured to cooperate. They suffer horrendously, with victims frequently living in inhumane conditions and sometimes locked up in cages.
Despite the magnitude of the problem, the amount of prosecutions against those involved is incredibly low. In 2015, there were only 55 cases that led to convictions. There is no data on 2016 yet. That’s 1.2 million children in forced prostitution vs. 55 legal cases. The fact the perpetrators are not being punished allows underage prostitution to continue on such a scale. In addition, a lack of good lawyers and judges with knowledge around human trafficking and child prostitution impacts the amount of convictions. All these factors have motivated the Free a Girl Movement India to take the radical step of opening the School for Justice.
Bollywood actor and activist Mallika Sherawat, who is an ambassador of Free a Girl Movement, is a committed supporter of the School for Justice. She said: “Underage girls forced into prostitution is a problem that we simply can’t ignore any longer. It’s the organised and systematic rape of young girls, happening on a mass scale, right here in Mumbai, Delhi and other cities in India. Girls, sometimes as young as 7 or 8, are forced into this life. By freeing the girls, we’re not changing the system that allows this crime to happen. To break this cycle, we will attack a key factor: the fact that the perpetrators are not being punished. Because they are not punished, they can continue with their crimes. I ask you to support the School for Justice to help the victims turn their anger at this injustice into a force for good – and a furious determination to put everyone involved in child prostitution behind bars.”
Francis Gracias, Free a Girl Movement CEO said: “The School for Justice is an ambitious project - the class of 2017 is just the first step in our plan. We want to attack the culture that allows the criminals behind child prostitution by educating the victims of this crime to become lawyers and prosecutors with the power to change the system. We appeal to all of India to get behind The School for Justice and support our cause - as we can’t do this alone. Ultimately we want governmental support and to build up a robust advocacy programme to push for law reform to make a positive change for India.”
The ad agency behind the idea, J. Walter Thompson Amsterdam has gone far beyond the traditional ad campaign for India’s burgeoning ‘Free a Girl Movement’ with its work to create a School for Justice where the victims of child prostitution in India are taught law, enabling them to prosecute the criminals responsible. This radical approach taken to help raise awareness about child prostitution in India for the movement is both a solution to a problem as well as a communications idea to boost its profile.
(Source: SchoolForJustice)
Last week the UK saw the enforcement of a 28-day limit on police bail. This comes after criticism of scenarios where people have been kept on police bail for months, and in cases even years, without charge during investigations, essentially in a legal limbo. There is still the flexibility of an extension up to three months in complex cases, but before this change, police bail periods had no limit.
Given the sensitivity of these bail scenarios, authorities and the majority of the public back the change, and are leaning on the effective adaptation of police forces, but some are also not as keen, claiming the new rule could put victims at risk because suspects may be released without conditions.
Today we hear Your Thoughts and below list some comments from reputable sources in the legal sector who give their two cents on the matter.
Mark P. Thomas, Senior Lecturer, Nottingham Law School:
The Policing and Crime Act 2017, which amends the Police and Criminal Evidence Act 1984, paves the way for a potentially dangerous and turbulent course of events.
The “overriding objective” in the Criminal Procedure Rules 2015 requires cases to be dealt with “justly”. “Justly” means convicting the guilty and acquitting the innocent and dealing with cases efficiently and expeditiously. The introduction of a 28-day cap does not reflect this fundamental principle of criminal justice.
The former law would allow the police to hold a suspect on bail for an indefinite period of time during which time they could investigate and assess the cogency of evidence before then making a decision as to charge. This approach has, admittedly, involved the use of pre-charge bail over an elongated period of time. However, the introduction of a 28-day cap is not the answer.
Its effects are likely to be two-fold:
In the alternative, the appropriate officer may consider that charging is not possible on the evidence provided. This in turn will allow potentially guilty suspects to run free and potentially cause injustice for the alleged victim of the offence. On a large scale, the police force may no longer feel comfortable to charge suspects within such a tight turnaround, thus deferring their charging powers to the already overworked Crown Prosecution Service (CPS).
It is supposed that the silver lining in this issue is the ability to grant extensions on the use of police bail. Bail may be extended for up to three months by a senior police officer at superintendent level or above or the police can apply to the magistrates’ court for further extensions in the relevant period of time.
Although the 28-day cap will end the “injustice” to persons held on bail for long periods of time, the cap will also increase the potential injustice of persons charged prematurely with criminal offences which are either dealt with at a much later date than they presently would be, or would be dropped after time where no case is possible.
In effect the 28-day cap has the result of swapping one injustice for another.
Nick Barnard, Associate, Corker Binning:
Since its introduction in its present form by the Police and Criminal Evidence Act 1984, pre-charge bail has been a valuable tool for investigators during the preliminary stages of a criminal enquiry. It allows suspects under arrest to be released from custody whilst obliging them to return in future for further interview or charge. In the interim, they may be subject to conditions restricting their movements and behaviour, such as surrendering their passport or regularly reporting to a police station.
Whilst the benefits for the investigator are obvious, limited judicial oversight and lack of statutory time limits meant that police bail could be used to disproportionately restrict the rights of suspects for an indefinite period. However, following its Royal Assent earlier this year, sections of the Police and Criminal Evidence Act 2017 concerning pre-charge bail are now in force which significantly curtails its use.
As of Monday 3rd April 2017, there is a presumption that all suspects who are under arrest will be released without bail unless it is ‘necessary and proportionate’ - previously there was no requirement for proportionality. Furthermore, in most cases a suspect may only be kept on bail for 28 days without the approval of a superintendent (or senior) and up to three months before being approved by a magistrates’ court. Even where the court does grant approval, the application must be revived every three or six months, depending on the complexity of the case.
On paper, this is progress. However, in practice it will be of no benefit if not accompanied by a change in attitudes and a considerable boost to resources. After all, if pre-charge bail had previously only been utilised where necessary and proportionate, and investigations dealt with in a timely and expeditious fashion, there would have been no need for reform.
If the reforms are to succeed, the police must regard the new procedures as achievable targets and necessary safeguards, which protect the rights of those who have yet to be charged with any offence.
It also means we must also support the inevitable call for the more onerous requirements to be matched by a sufficient increase in resourcing, both for the investigating agencies and the ancillary services (e.g. forensic experts) upon which their work depends.
It would be the worst of all worlds if the new pre-charge bail regime became another cause of, or an excuse for, further delay in criminal investigation.
We would also love to hear more of Your Thoughts on this, so feel free to comment below and tell us what you think!
O.P. Jindal Global University (JGU) in association with Stanford University, US, hosted 'Law of Democracy - India Field Study', a joint exercise offering an exciting exploration of the legal, political and social constructions of the Indian and American democracies from 26th March - April 1st 2017. The programme was conducted under the auspices of the Centre for Post Graduate Legal Studies at the Jindal Global Law School.
The wide canvas of democratic elections, means that it embraces normative enquiries into meanings and modes of representation as well as policy debates over campaign finance, corruption and criminalization of politics. Given that democratic politics is not autonomous of law, this joint programme on election law and practice intends to gather insight into an interdisciplinary and comparative conversation about the mechanics of world's two largest democracies - India and the United States.
In order to understand and fathom the many intricacies in context of the Indian democratic system, the students from Stanford Law School visited various institutions like the Election Commission, Supreme Court of India, Delhi High Court and Delhi High Court Mediation and Conciliation Centre, Ministry of Law and Justice and Law Commission of India, Parliament, Rashtrapati Bhavan and attended intense interactive sessions with judges, officials and government functionaries.
As a part of the programme, Professor Benjamin L. Ginsberg, Stanford Lecturer, Partner, Jones Day Law Firm at Indian Law Institute delivered a distinguished Public Lecture on 'The Trump Administration to Date and What to Expect in the Future'. He said, "Trump considers social media as an enemy, a rival in the United States. We have seen a change in the way political agenda gets set every day. Of course, if you live by the tweet you can get burnt by the tweet."
"People in the United States and around the world have two very different views of Donald Trump. From the Trump administration side, they believe that they are historic and are really fighting to put in place the much needed changes, they believe they are off to the best start in the history of any presidency. In case you do not like Donald Trump, you are likely to see the distractions, immigration bans, the fights that he has picked with US senators and retailers," he further added.
Professor (Dr.) C Raj Kumar, Founding Vice-Chancellor, JGU, in his opening address at a conference on 'The Laws and Lives of Democracies', a part of the joint exercise, held at JGU on Day 4 observed that the programme in its entirety is crucial in helping develop an understanding of the functioning of the world's largest democracy.
Prof. Raj Kumar defining the India experience to the Stanford Law students remarked, "India is one of those countries where after you visit, you are never the same again. It is one of those countries where contradictions, contrasts and complexities are a part of the Indian experience. This conference will give a sense of some challenges and issues we face as a democracy and what we as a democracy are planning to address."
Describing the conference as opportune and relevant, Professor Nathaniel Persily, James B, McClatchy Professor of Law, Stanford Law School remarked, "Our democracy is under stress. The issues that we talk about here in terms of the voting rights, representations, the campaigns finance, corruption, access are ones that are continuously being debated in the United States."
Elaborating on the experiences gathered from various field visits, Prof. Persily said, "We have already learnt an enormous amount from our meetings with various Supreme Court justices and visiting other institutions here in India. We know we have a lot to learn and in some ways you learn even more about your own country when you have something to compare it to."
Expounding the theme of the seminar, Prof. Dabiru Sridhar Patnaik, Director, Centre for Post Graduate Legal Studies said, "The seminar is part of the joint programme on Law of Democracy - India: Field Study that covers all the three pillars of Indian Democracy to understand the process of law making, law implementation and interpretation in India and the varied legal and policy challenges that Indian Democracy faces. So the seminar is an idea to invite multidisciplinary and comparative perspectives on laws and lives of democracies in India and USA to develop awareness, knowledge and critical thinking on the issues and challenges in India and US on matters of elections, representation and accountability."
Delivering the keynote address on 'Dreaming Democratic Decentralization: On What it Takes to Represent Cities and Villages', Dr. Jayaprakash Narayan, Founder, Loksatta Party and General Secretary of Foundation of Democratic Reforms praised the Indian democratic structure for sustaining itself over the years despite being a nation vast in its diversity. "The fact that there has been peaceful transfer of power in the country, perhaps the only country in the post Second World War era to have built a successful federalism structure, and its actually getting better, the fact that the world's most complex multi-lingual nation could somehow handle the issue of language harmoniously, all these are wonderful tributes to democracy."
However, he disparaged the asymmetry of institutional power which has been a deterrent in establishing a successful democracy in the country, "Now there is an increasing dependence on 'super men', the big leaders, the messiahs. In these days of social media there is a desperate hunger for success and leadership and therefore, we want to achieve miracles, quick fixes by dramatic flourishes and few gestures. It may be demonetization here or some other slogan, but it doesn't solve anything. It is the curse of centralization, the moment you centralize in a vast country, like ours, all your hopes on one human being on a national or state level and nobody else matters."
Calling for repairing the fractures in the Indian democratic structure, Dr. Narayan added, "If you take the initial conditions of Indian democracy and impose the universal adult franchise on that without correcting the initial distortions in society which are not hospitable to democracy, it's mathematically inevitable that we land where we are in India today. It's not because India is unfit for democracy, it's not because some other society is more fit. It's because we haven't created conditions necessary for successful democracy."
The joint programme also had an illuminating lecture by Dr. Shashi Tharoor, Member of Parliament, Lok Sabha. He spoke about the fickle nature of Indian voters and the challenges faced by political parties, "In the US house of representatives, the re-election rate is 92% over the last 30 years, and if you look at India's lower house, the house that I belong to, the re-election rate is 26% over the last 25 years. So the voters are incredibly demanding and they change their minds every 5 years, and it becomes a particular challenge to work for change in the midst of all this at a time when a majority of your voters live of less than $2 a day, while you are trying to bring about far reaching changes in the society."
The five-day joint programme consisted of a diverse range of thinkers and practitioners to reflect on democratic processes, election laws and institutional design and the panellists employed a range of methods - historical, comparative, sociological, political, philosophical, legal and empirical - to explore challenges in the theory and practice of democracy. This programme was part of an evolving research agenda between partner institutions of JGU and is expected to be a melting pot of ideas on democracy and its institutions and likely to determine the course of future discussions and debate on the subject.
(Source: O.P. Jindal Global University)
As the UK’s Gender Pay Gap reporting legislation recently came into force, Suzanne Horne, Head of the International Employment Law Practice at Paul Hastings, explains to Lawyer Monthly the potential effectiveness of the new rules and the implementation thereof.
Whilst the gender pay gap will rightly shine a light on gender pay, the incoming regulations leave a lot to be desired. If public shaming is going to be the stick used to coerce larger employers into reducing their gender pay gap, then the reporting should be an accurate reflection of the gender pay and bonus disparity within the workplace.
As is stands, the reporting won’t reveal whether men and women are paid equally for doing the same or comparable jobs. It will simply show the mean and median difference in pay and bonus remuneration across a particular company. We only need look at a typical boardroom to know that women are woefully underrepresented at senior levels and those at senior levels are paid more. The reporting will tell us what we already know, whilst neglecting to consider the myriad of factors that legitimately differentiate pay such as levels of responsibility, nature of work, experience and geographical location to name but a few.
It is also likely to lead to widespread misconceptions; some may even say ‘Fake News’. One company’s gender pay gap of 50%, for example, might make for great headlines, but it doesn’t mean that the company is in breach of the equal pay legislation. Another company may be able to report a smaller gap, whilst in fact paying women less for doing the same or comparable role.
Due to the government’s preoccupation with Brexit, the gender pay legislation has failed to live up to its potential as a tool to accurately highlight the real issues and will cause a headache for employers who will need to focus on the voluntary contextual information to put the numbers in context.
The gender pay league tables that will emerge a year from now will require employers to step up their D&I initiatives and engage with their PR team but they will not move the needle on the issue of the gender pay gap.
The UK Supreme Court recently ruled that civil service employees do not have to show the reason why they were disadvantaged to progress their claims of indirect discrimination against their employer, the Home Office. This decision overturned the earlier decision of the Court of Appeal in June 2015.
The landmark case, brought by Thompsons on behalf of the Public and Commercial Services Union (PCS) concluded that workers do not need to prove the ‘reason why’ the practice in question puts, or would, put the affected group at a particular disadvantage.
The case, which began in 2012, was brought on behalf of 49 black, Asian, and minority ethnic (BME) civil servants who brought claims of indirect race and age discrimination against the Home Office. In order to be eligible for promotion to certain higher grades, candidates had to pass the Core Skills Assessment (‘the CSA’), designed to test certain competencies. Each of the Claimants had failed the CSA.
A report commissioned by the Home Office concluded that the CSA had a differential impact in relation to certain protected groups. Specifically, that white and younger candidates had a higher selection rate than BME and older candidates.
In June 2013 the Employment Tribunal determined, as a preliminary issue, that the Claimants needed to demonstrate both the reason for the lower pass rate in the relevant protected group and that the reason explained their own failure to pass the CSA. The Employment Appeal Tribunal disagreed but the Court of Appeal favoured the original approach of the Employment Tribunal, leaving the Supreme Court to determine the correct approach to indirect discrimination under the Equality Act 2010.
With the support of their union, PCS and the backing of the Equality and Human Rights Committee (EHRC), the employees were able to successfully challenge the findings of the Employment Tribunal and Court of Appeal. By a unanimous judgement, the Supreme Court said that it was ‘not necessary [for the workers] to establish the reason for the particular disadvantage.’
General Secretary of the PCS, Mark Serwotka, said: "This is a major win, not just for this group of civil servants, but for workers challenging discrimination in the workplace.
“We knew these procedures were flawed, and the Home Office can no longer deny the fact that staff shouldn’t have to prove how and why they are being discriminated against.”
Kate Lea, employment rights solicitor at Thompsons, added: “Indirect discrimination aims to achieve equality of results. It deals with hidden forms of discrimination which are not easily identified. This decision will help workers challenge disguised discrimination in the workplace.”
(Source: Thompsons Solicitors)
