The Gender Equality Duty

On the 6 April the Gender Equality Duty (“GED”) comes into force under the Equality Act 2006. It has been described as the most important sex equality legislation for 30 years, and will impose a positive duty on public authorities to address the different requirements of men and women among their service users. The duty shifts the balance from an individual being required to show discrimination towards the public authority demonstrating equality. The duty applies equally to the roles of service provider and employer.

Public Authorities

Under the Equality Act 2006, a public authority is defined as “any person who has functions of a public nature” and will therefore cover GP and Dental surgeries.

Service Provider

Male and female service users have different requirements and will approach a service accordingly. The Equal Opportunities Commission gives the example of the provision of service by a General medical practice and states that men are less likely to visit their GP than women; a practice should examine the way their services are provided and whether there are alternatives that would increase use by male patients. This could be the provision of a clinic at football grounds or targeting male patients for specific treatments.

Employer/Employee

The relationship between an employer and an employee is another area targeted by the new legislation. Recruitment and employment policies should be reviewed as the GED imposes the duty on an employer to ensure that the workplace has a gender balance. Are there barriers that are reducing the number of suitable female applicants for posts? Examples of these may be the maternity arrangements available or the provision of flexible working.

Implications

A failure to comply with the GED can result in the imposition of a compliance notice by the Equal Opportunities Commission (which will become the Commission for Equality and Human Rights in due course)

Maternity and Adoption Leave (Amendment) Regulations 2006

Maternity and Adoption Leave (Amendment) Regulations 2006

From 1 April 2007, changes to Maternity Leave entitlements will come into force extending Additional Maternity Leave (“AML”) to all female staff. The legislation also introduces the opportunity for “keeping in touch” days and reasonable contact between the employer and employee. The legislation will impact on all female staff employed by general practices.

Impact on Employers

· 8 weeks notice must be given by the employee that they intend to return before the end of their AML.

· Entitled to Maintain “Reasonable Contact” during the maternity leave to discuss workplace matters. This is to reduce the chances of being accused of harassment during the maternity period although “reasonable” is not defined.

· Salaried female GPs and practice staff will be entitled to 39 weeks paid maternity leave; this has been increased from 26 weeks.

· “Keeping in Touch” days can be agreed with the employee to allow her to attend work for up to a maximum of 10 days without losing entitlement to maternity or statutory maternity pay.

Impact on Employees

· All female staff will be entitled to 52 weeks maternity leave from the 1 April 2007

· There is no longer a requirement to have been with the same employer for 26 weeks to be entitled to AML.

· Salaried female GPs and practice staff will be entitled to 39 weeks paid maternity leave; this has been increased from 26 weeks.

· “Keeping in Touch” days can be agreed with the employer to allow her to attend work for up to a maximum of 10 days without losing entitlement to maternity or statutory maternity pay.

Gifts of money for minor children: how can parents, grandparents, close relatives or god parents provide for children?

Introduction

The birth of a new baby usually associates delighted parents, grandparents or close relatives giving sums of money. If not following the birth, subsequent birthdays and Christmas are traditional times for monetary gifts to be awarded.

The following questions then arise:

What should parents do with the money?

Can it be invested in the child’s name?

Can they spend it freely for the benefit of the child?

Are there any formal restrictions as to what parents can do; perhaps more importantly, what cannot be undertaken.

Monies that are deposited in a bank or building society account

A minor can open a bank or building society account. The Building Societies Act 1986 provides that a minor may be admitted as a member.

However, if the child is not old enough to operate the account, parents may decide to invest the money in their own names. If this is the case, what rights and obligations do the parents then have?

Has a trust been created?

It may well be the case that where say relatives hand over monies to the children’s parents “to hold for the children” that the parents are acting in the fiduciary duty as trustees.

A first consideration is that of “children” – are there step children and children of both parents in the family? A gift for the benefit of “the children” is ambiguous and needs to be clearly defined to avoid future problems arising when “the children” reach their majority.

Are any formalities needed to create a trust?

Section 53 (1) of The Law of Property Act provides that a declaration of trust in respect of any land, be actioned and proved in writing and signed by a person who is able to declare such a trust or by his/her will.

It is clear however that if the declaration of trust is over property other than land (or an interest in land) an oral declaration is sufficient.

Thus a donor who provides money, or other assets to parents, can create a trust in favour of the children without any written document.

Are parents subject to any duties as trustees?

If it is assumed a trust is created –parents (or grandparents) will then be subject to all the formal duties and obligations imposed on trustees. A prime duty here is that in relation to investment.

Generally a will (or any other document creating a trust instrument) will give trustees absolute discretion as to how trust funds should be invested.

Where a gift by a third party is given to the parents to hold on trust “for the children”, it is unlikely that the donor will have given an express power. However, it will be implied if the donor states “use it as you may think fit for the children”. In the absence of any express or implied power, then investments must be made in accordance with the Trustee Act 2000.

Parents may be very surprised to learn that they may be subject to these (onerous) duties with regard to investment of money given to them for the benefit of their children assuming a valid trust is created.

Fortunately, if comparatively small sums are involved –parents will probably discharge their duties by investing monies in National Savings Certificates. However, to avoid any possible hint of criticism in the future –parents would be well advised to take independent financial advice.

Can parents spend the money for the benefit of the children?

The answer here depends on the manner and any powers given to the parents by the donor.

In its simplest form “here is £25.00 spend it on the children for me”. This is an express authority for parents to apply the money for the benefit of the children.

In the absence of such directions – the donor must look to Sections 31 & 32 of the Trustee Act 1925.

In brief terms trustees may, at their sole discretion, pay to a parent or guardian or apply towards the infants, maintenance education or benefit, the income arising “as may in all the circumstances be reasonable”.

In so far as income is not so applied, it has to be accumulated until the infant either attains 18 years or marries under that age.

It is clear that parents have power to apply the whole of the income for the benefit of their children.

A power to advance capital is incorporated within Section 32 of the Trustee Act 1925. This enables Trustees to advance up to one half of the capital to which a beneficiary is, or might be, entitled. Trustees have an absolute discretion as to how such power should be exercised and, in appropriate circumstances, it is possible to widen the discretion to the extent of the whole presumptive capital.

A typical situation could be for Trustees to exercise their discretion, where the minor beneficiary requires special equipment to assist with an educational requirement or need, particularly if an element of disability was involved.

Taxation

Minors are subject to income tax, capital gains tax and inheritance tax in the same manner as adults. The corollary of this is that minors are also entitled to the various tax allowances and reliefs as adults: for example the income tax personal allowance and capital gains tax annual allowance.

There are anti-avoidance provisions in place where it is deemed that income arising belongs to the parent rather than the child (subject to a general exemption of £100.00 gross income per income tax year).

The anti-avoidance provisions referred to above are excluded where grandparents make provision for minor children rather than immediate parents.

Trusts for Bereaved Minors

A donor may wish to make ‘settled property’ or money for the benefit of children; a Will trust could make similar provision. The concept of “Bereaved Minors” trusts was introduced within the Finance Act 2006 – (provided certain qualifying criteria are met); such trustscanhavesignificant IHT advantages.

Summary

A minor can hold a bank or building society account but it must not become overdrawn

Gifts of money for the benefit of children by parents, grandparents, other relatives or friends may create a trust in their favour

Parents and grandparents are subject to the same duties as other trusteesand have the same powers and obligations.

Andrew Murdoch

Associate – 27 March 2007

The Burden of Proof and Unfair Dismissal

In Kuzel v Roche Products Ltd. the Court of Appeal considered where the burden of proof lies when an employee brings a claim for unfair dismissal but where different reasons for the dismissal are put forward by each side.

In this case, Dr Kuzel claimed that the real reason she was dismissed was because she had made protected disclosures about certain of her employer’s activities. The dismissal was therefore ‘automatically’ unfair and there should be no cap placed on the amount of compensation payable. Roche Products Ltd. argued that the reason Dr Kuzel was dismissed was either a conduct reason or ‘some other substantial’ reason.

The Employment Tribunal (ET) found that Roche had failed to demonstrate a potentially fair reason for Dr Kuzel’s dismissal but neither could it find evidence to support her claim that she was really dismissed for ‘whistleblowing’, ruling that the claim was ‘not made out’. The use of this phrase caused disagreement as to whether or not the ET was saying that the burden of proof lay with Dr Kuzel. The ET held that the reason for the dismissal was Dr Kuzel’s line manager’s ‘catastrophic loss of temper’ and his failure to follow the advice of the company’s Human Resources Director with regard to the situation.

The Employment Appeal Tribunal (EAT) held that the ET’s approach to the burden of proof of the whistleblowing claim was not legally correct and remitted the case to the same ET for a fresh hearing.

Dr Kuzel appealed, arguing that as Roche had failed to prove that it had a fair reason for dismissing her, the ET should, as a matter of law, have accepted the reason she put forward. The Court of Appeal rejected this argument. The principal reason for a dismissal is a question of fact for the ET. It is for the employer to prove the reason for the dismissal as it knows better than anyone else why the employee was dismissed. In this case, it was for Roche to show that the reason for Dr Kuzel’s dismissal was a fair one. In contesting the reasons put forward by Roche, there was no burden of proof on Dr Kuzel to disprove these reasons, let alone prove a different reason. When an employee asserts that the dismissal was for a different reason altogether, some evidence to support their claim must be produced but they do not have to discharge the burden of proving that the dismissal was for the different reason for their claim to succeed.

If the employer does not demonstrate that the reason for dismissal was the one it put forward, it is open to the ET to find that the reason was that claimed by the employee. However, ‘it is not correct to say, either as a matter of law or logic, that the ET must find that, if the reason was not that asserted by the employer, then it must have been for the reason asserted by the employee. That may often be the outcome in practice, but is not necessarily so’. The ET may also find that the true reason for dismissal was one that was not put forward by either side.

The Court of Appeal therefore dismissed Dr Kuzel’s appeal and reinstated the decision of the ET. Roche was liable for ‘ordinary’ unfair dismissal because it had not demonstrated its case, but the dismissal was not automatically unfair because Roche had shown that the making of protected disclosures by Dr Kuzel was not the reason for her dismissal. The compensation awarded was therefore limited to £56,800, the maximum amount payable in unfair dismissal cases at that time.

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.