Changes to the Employment Act 2000 – Part 2

Below, we briefly outline the key changes that were not covered in our previous article and consider some of the practical implications.

Bullying and harassment

New clause 10B will make it a legal requirement for employers to have in place a written policy against bullying and sexual harassment within the workplace. That policy must contain certain terms, including:

• a statement that employees are entitled to a workplace free from bullying and sexual harassment;
• a statement that the employer will make “every reasonable effort” to ensure that no employee is subject to bullying or sexual harassment;
• details as to how complaints may be brought to the employer’s attention.

The Act also includes definitions of “sexual harassment” and “bullying” that employers are required to use, in substance, in their policy. There are many notable elements of the definitions used in the Act, which would merit an article in their own right, but the following points are of particular interest:

• the definition of “sexual harassment” is different to that used in the Human Rights Act 1981 (HRA), meaning that an employee could be subject to harassment falling foul of their employer’s policy but which does not entitle them to bring a legal claim;
• many employers already have policies against this type of conduct which use more inclusive definitions than those used in the Act, meaning that well-intentioned employers may feel pressured to amend their policies in a manner which weakens the protection they currently offer their employees.

Employers will also be subject to a broad obligation to ensure that “procedures are put in place to assist every employee in understanding the policy”. This arguably places employers under a positive duty to deliver training to employees on bullying and sexual harassment issues.

Redundancy consultation

Before making an employee redundant, employers will now be required to give certain information to the employee, including the reasons for the proposed redundancy and the number and categories of employees affected by the redundancy situation. The Employee must also be consulted on possible measures that could be taken to avert, minimise or mitigate the adverse effects of the redundancy. These steps must be taken at least 14 days before giving notice of termination.

This is the first time that employers will have been subject to a legal obligation to inform and consult with employees on redundancies (although many did so anyway, as a matter of good practice). Currently, these steps are only required where the employee is represented by a trade union or other employee representative.

Similar duties will also need to be satisfied before making lay-offs.

Independent contractors

A new power is to be introduced for the Government to issue guidance for the purpose of determining “whether a relationship more closely resembles that of an employee than an independent contractor”. When it is published, such guidance should help provide clarity as to whether an individual is an employee, in which case they are entitled to the various employment rights and protections under the Act, or whether they are a self-employed contractor, in which case they are not.

Influenced by the growth of the so-called ‘gig’ economy, where workers are often labelled as self-employed contractors even though their engagement may bare many of the features of a classic employment relationship, the question of whether someone is an ‘employee’ has been an increasingly contested area of law in the US and UK in recent years. As such, any future guidance in Bermuda should be of much interest to employers and workers alike.

Limitation period

At present, an employee has three months within which to make a complaint that his employer has failed to comply with the Act. From 1 June 2021, this will be increased to six months.

Unfair dismissal compensation

The minimum compensation award for a successful unfair dismissal claim by an employee with no more than two years’ service is to be increased, from two weeks’ wages per completed year of employment, to three.

Statement of Employment

Additional matters will now need to be addressed in the ‘statement of employment’ required to be given to all employees under s.6 of the Act, including:

• their entitlement to rest days and meal breaks;
• their entitlement to overtime pay or hours in lieu, and the method of calculation;
• where applicable, the fact that the employment is pursuant to a work permit and the expiry date of that permit; and
• the existence of the employer’s policy on sexual harassment and bullying and how that policy can be accessed.

It is not an understatement to say that the upcoming changes represent a significant overhaul of the Act. While some will necessitate only minor tweaks to existing documents and procedures, others are more onerous or will involve a substantial change to current HR practices.

Anyone with any questions about these amendments can contact a member of our Employment and Immigration Practice: Bradley Houlston ([email protected]) or Jordan Knight ([email protected]).

Please look out for the next part in this series, which will discuss forthcoming amendments to Bermuda’s Labour Relations legislation.