There are a number of changes to the legal landscape across the Channel Islands expected in 2018.

Are you ready for GDPR?

One of the biggest challenges facing Channel Island businesses in 2018 will be ensuring that they are properly prepared to ensure compliance with the new data protection legislation which is expected to be introduced in the near future to ensure adequacy with European General Data Protection Regulation (GDPR), which will come into force for all EU member states and those businesses dealing with EU member states on 25 May 2018. Both Islands have now published their legislation although the Jersey legislation is still to be debated before the States in mid-January. For further information on the GDPR and its impact on Channel Island businesses please see our dedicated GDPR hub.

Disability discrimination in Jersey

On 4 September 2017, the Social Security Department issued a consultation paper inviting comments on the proposed scope of protection against discrimination on the grounds of disability. The consultation closed on 10 November 2017. It is expected that protection against disability discrimination will come into force on 1 September 2018.

Review of family friendly rights in Jersey

The Employment Forum released a consultation on 5 January 2017 in relation to the family friendly rights which currently operate in the Jersey which includes maternity, parental and adoption leave, antenatal care and flexible working. The consultation closed on 17 March 2017 and it is expected that the Employment Forum will publish its recommendations towards the end of this year.

If you have any questions regarding any of the above, please do get in touch with one of the team.

The Control of Housing and Work (Fees) (Amendment No.2) (Jersey) Order 2017 (the Order) came into force on the 7 October 2017 and introduced annual charges for engaging employees with Registered status. The Order can be accessed here.

The annual charge is £500 in respect of each Registered person who is permitted to work for an employment agency, in accordance with its business licence. This annual charge also applies in respect of any persons whose labour is supplied by an employment agency for the purpose of working at another undertaking.

By contrast, the annual charge for each Registered person who is permitted to work directly in or for an undertaking in accordance with the business licence of the undertaking is £50.

The date on which the annual charge must be paid will be agreed by the Chief Minister. In the absence of any such agreement the fees will be payable for all individuals which are engaged by an undertaking on 1 November of each year and must be paid by 31 December in that same year.

A recent case involving a misunderstanding regarding the difference between Licenced and Registered status has highlighted the importance of ensuring that businesses have the relevant approvals prior to the engagement of employees.

A local agricultural entrepreneur, Mr Glyn Mitchell (Mr Mitchell), convinced Mr Jonathan Zach Wright (Mr Wright) and his family to move to the Island from the United States on the basis of employment. However, Mr Mitchell failed to obtain the relevant permission from the Population Office in order to employ him.

There are four categories of housing and residential statuses:

• Entitled - someone who has been ordinarily resident in Jersey for 10 years;
• Entitled for Work - someone who has lived in Jersey for 5 consecutive years, or is married to someone who is Entitled, Licensed, or Entitled for Work;
• Licenced – someone who is an essential employee; and
• Registered - someone who does not qualify under the other categories.

As an employer you need specific permission from the Population Office to employ either a Licensed or Registered person.

Mr Mitchell's failure to obtain the requisite approval before employing Mr Wright lead to an investigation by the Population Office which resulted in allegations that Mr Mitchell had deliberately falsified employment documents. 

Although Mr Mitchell was found not guilty, it serves as a valuable reminder to employers.

On 29 September 2017, the Employment Forum issued their recommendations for changes to the minimum wage. A copy of the recommendations can be accessed here.

The recommended rates are based on the results of the Employment Forum's consultation process which took place from 5 June to 28 July 2017. The table below sets out a summary of the proposed changes to the minimum wage rates. If approved by the States of Jersey, the recommended rates will apply from 1 April 2018.

In the November States' meeting, the States of Guernsey approved an increase to the minimum wage with effect from 1 January 2018 to £7.75 per hour (for workers aged 18 and over), and the young person’s minimum wage rate to £7.05 per hour (for workers aged 16 and 17).

Statutory illegality arising from an illegal employment contract will strictly result in both parties not being entitled to bring a claim against the other on the basis of employment. This was highlighted by the Jersey Employment and Discrimination Tribunal (the Tribunal) in the recent case of Gorazd v Quayside Café Limited.

The illegality arising in this particular case was due to non-compliance with the Control of Housing and Work (Jersey) Law 2012. An individual who has Registered status may not work for a company unless it has a business licence which specifically entitles it to employ Registered individuals. Therefore, if a company employs a Registered individual but does not have the necessary permission, it will be acting illegally.

In this case the Claimant acknowledged that she was working illegally. Indeed she had asked the Respondent to go to the Population Office to obtain permission to employ her. However, this was not done and accordingly the contract was rendered void and unenforceable by the Tribunal.

The consequence was that the Claimant was not recognised as an employee of the Respondent and she did not therefore enjoy statutory employment rights meaning that she could not bring an unfair dismissal claim. Her breach of contract claims against the Respondent could also not be pursued because the contract did not exist in law. This case highlights the importance of obtaining permission to employ Registered employees to avoid the employment relationship being called into question.

Whether it is in the world of movie producers or politicians, one of the biggest news stories in 2017 has been the need to stamp out all instances of sexual harassment. Whatever the workplace, such behaviour cannot be tolerated.

In Guernsey, whilst the sex discrimination legislation does not specifically refer to sexual harassment, the Commerce and Employment Guide entitled "Sex Discrimination in the Workplace" states "Harassment in the workplace may be defined as unwanted, unreasonable or offensive conduct (physical, verbal or otherwise of a sexual nature) or any other conduct based on sex which affects the dignity of men and women in the workplace." In Jersey, the discrimination legislation prohibits sexual harassment.

Clearly, an employee who perpetrates sexual harassment should be subject to disciplinary proceedings, but when is an employer vicariously liable for such actions? This question was considered in the recent UK case of Various Claimants v Barclays Bank plc [2017] EWHC 1929 (QB), where 126 individuals brought claims against the bank for sexual abuse which occurred during medical examinations for potential recruits.

The High Court held that determination of the issue as to whether or not vicarious liability exists in a particular case involves a two stage test i) Is the relevant relationship one of employment or "akin to employment"? and ii) If so, was the wrongful act/omission sufficiently closely connected with that employment or quasi employment?

Relevant to the determination of the first stage are five policy criteria identified by Lord Phillips in the UK case of Catholic Child Welfare Society and others v Various Claimants and others [2012] UKSC 56:

1. The employer is more likely to have the means to compensate the victim than the employee and can be expected to have insured against that liability;

2. The wrongful act/omission will have been committed as a result of activity being taken by the employee on behalf of the employer;

3. The employee’s activity is likely to be part of the business activity of the employer;

4. The employer, by employing the employee to carry on the activity will have created the risk of the wrongful act/omission committed by the employee;

5. The employee will, to a greater or lesser degree, have been under the control of the employer.

In Various Claimants v Barclays Bank plc, the High Court held that the relationship between the bank and the doctor was akin to employment, applying the five criteria identified above. Notably the examinations had been performed for the benefit of the bank and on its behalf, and the doctor was under the control of the bank as they could tell him what to do, albeit that they did not direct the manner in which he did it.

In respect of the second test, the High Court found that the alleged sexual abuse was inextricably interwoven with the carrying out by the doctor of his duties pursuant to his engagement by the Bank. Finally, the Court found that it was fair, just and reasonable to impose vicarious liability, even though the claim was being brought many years after the alleged assaults.

This case shows that the bar is set high for employers in taking whatever measures they can to ensure that no employees suffer sexual harassment. Employers should have training and policies in place making clear that such behaviour is not tolerated, and this should apply to all persons coming into contact with employees, whether they are employees, contractors or otherwise.

In an age of an increasingly-mobile workforce, the answer may well be that the employment protection of another jurisdiction will apply, as was held to be the case in the recent UK Employment Appeals Tribunal (EAT) decision of Seahorse Maritime Ltd v Nautilus International UKEAT/0281/16/LA.

Seahorse Maritime Ltd (Seahorse) is a Guernsey-registered company, employing individuals domiciled in the UK. English law applied to the contracts of employment and the English courts had jurisdiction to hear claims under those contracts. The employees could be mobile, yet commenced and finished each shift in the UK.

The issue was whether certain redundancy consultation rights applied under the law of the UK. The relevant UK law says that the laws will apply if the individual has a sufficiently strong connection to the UK.

Seahorse argued that UK-domiciled employees were 'international commuters' and as such fell outside the jurisdiction of the UK EAT.

The UK EAT held that although the UK-domiciled employees were employed by a Guernsey company and worked on ships overseas, the connection of their employment with the UK, and UK employment law, was sufficiently strong. The Tribunal said that the factors establishing the sufficiently strong connection with Great Britain and British employment law were that the parties chose English law to govern the contracts of employment, that the contracts were administered from Farnham in England, that the employees said to be in scope of [the section] lived in England and that they started and finished their work in England.

When employing mobile employees of a Guernsey company, or employees permanently based elsewhere, the employer will need to be aware of which jurisdiction's employment law protection may apply. Indeed for employers with operations across multiple geographies, the statutory protection of several jurisdictions may apply, depending on the circumstances. If in doubt, be sure to seek advice to confirm the obligations.

Globally, the last few years have seen a lot of discussion across HR teams of radically altering or even abandoning the annual performance appraisal. Some organisations have moved to a simple red-amber-green traffic light model, or focused discussions with an individual purely on future development rather than on judging past performance.

The common thread to all the new models is a push for a greater role for the team leader. Leaders are encouraged to have more regular discussions with their teams focused on developing rather than judging them. Greater focus on leadership and development is of course a commendable goal.

A common question an employment lawyer will have when reviewing a potential dismissal with a client is to what extent the individual has been notified of concerns about their performance and given a reasonable opportunity to improve. A once-per-year appraisal discussion will usually be unlikely to amount to reasonable notification of concerns (unless, for example, it was conducted very recently). Leaders ideally should be raising concerns with the individual as soon as they come up and be sure to evidence those concerns, i.e. via an investigation and disciplinary in serious cases, or less dramatically by file noting records of informal discussions for less serious issues. If nothing else, there should at least be a realistic and objective assessment of the performance captured in the annual appraisal. So there's value in the annual appraisal from an evidentiary perspective.

A poor outcome then would be to do away with the annual appraisal but replace it with…. what exactly? There could be problems for an employer that does away with appraisals but then fails to invest time in proper development discussions with employees. An appraisal-free model requires leaders to commit to regular discussions with their employees and ensure the employee knows how they are progressing against expectations and more importantly, how they can develop further. Commentary in the HR field regularly calls for a more employee-centric feedback model, which is said to chime well with the expectations of the younger generation of professionals.

The law isn't prescriptive about a particular need for annual appraisals or organised 1-on-1 meetings between leader and employee, etc. What it does call for is for the employee to be well aware of what is expected and to be notified of concerns with a fair chance to improve. Given that the appraisal formula often fails because leaders can't or won't speak to employees in a transparent and effective way, it’s a big ask to think that these alterative models will be done properly in the absence of the framework an appraisal at least provides. Nevertheless, the new models could be well accommodated within existing legal parameters. The question though is whether organisations are ready to revise their expectations of their leaders and, importantly, to ensure sufficient time and training is made available to them to more fully invest in their team's development.

There is great excitement around ending the annual performance appraisal and replacing it with a development-led model. It's worth noting that these changes have for the most part been brought in only in the last two years or so. We look forward with interest to some research into some quantifiable improvements flowing from the 'death' of the appraisal. The appraisal, for many, remains on life support for now.