Two-Tier Systems

SophieRoyal · PayPerShop Newbie Joined: 09 Nov 2007 Posts: 1

Our employer offers different benefits for different groups of staff.
Some are paid acording to the national payscales for their particular area even though they are not part of a union representing their particular profession. Because they are paid in this way, some are given better benefits than others for example, a better pension scheme is available to them and their sick pay and SMP agreements are significantly better than some other employees who do not fall in to the same catagory.

I know that it is legal to offer a different pension benefit to some staff members and that your sick entitlement would be agreed in your contract so, may be different to others who are employed by the same company but it is ok to offer a two tier system when it comes to SMP ?
One group (the minority) getting statutory pay while the other group (the majority) qualifying for 6 months on full pay and 6 months SMP.
This is obviously unfair, but my question is, is it legal ?

Ian Congreave · Posted: Wed Nov 14, 2007 9:24 am Post subject: Two-tier maternity benefits

It is necessary here to distinguish between "statutory" maternity leave and pay, and "occupational" maternity leave and pay.

Statutory leave and pay are defined in legislation and no two-tier system is permitted. Anyone meeting the conditions for entitlement must receive the full statutory benefits - a year's leave, 9-months pay, 6 week's pay at the higher rate, and so on.

However, employers may top up the statutory provisions for the whole workforce or for certain groups. That is a contractual matter. So, some may only be entitled to the statutory provisions, other may have better benefits, such as full pay instead of 90% for the first six weeks, or half pay plus SMP for six months, or whatever. Those improvements are entirely contractual and it is not discriminatory to treat different groups of employees in different ways. But they must all receive the basis statutory provisions.
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Ian Whyteside · Posted: Sun Nov 18, 2007 5:52 pm Post subject: Two tier systems

Hi Ian and Sophie,

Interesting point here and one I have puzzled over for some time.

Can you seriously pay vastly different benefits to one group and not another? It bothers me that we are supposed to acheive pay equality and many organisations have woken up to the idea that this should be in overall terms, not just main pay scales.

In HMRC for instance OMP is 6 months at full pay, but this applies to all employees not just ones in certain parts of the organisation. But take local government where teachers maternity rights are far superior to any other group in local councils, yet they all have the same employer.

I have never considered this to be right but every time I have raised the issue I have been told to drop it, and fast.

So how far does an organisation have to go to acheive pay parity and can we really say that having such glaring discrepancies is not discriminatory?

Sorry to be controversial.

Ian Whyteside

Vince · Posted: Mon Nov 19, 2007 1:02 pm Post subject:

An interesting, but not controversial in my view, addition by Ian W. It is a good point when there is is supposed to be equal and equality of pay. A further complicating feature I would add is the effect of the TUPE regs on this. I would suggest that these regs are one of the main reasons for discrepancies in T&Cs within a company, and not one that a company can easily deal with if it wishes to harmonise T&Cs.

Ian Whyteside · Posted: Mon Nov 19, 2007 1:16 pm Post subject: Two tier systems

Thank you for that Vince,

I totally accept that TUPE has had a very significant effect on terms and conditions in certain employers and this must be a nightmare for providers, especially small companies like the one I feel Sophie works for.

My work takes me around many organisations and my view is that there really is not any reason why terms and conditions discrepancies have to be maintained for the long periods they seem to persist. One client of mine thought that TUPE meant preservation of previous terms for ever and a day and it took me a long time to change that view, now they are in a programme of harmonisation, a long term one, which will result in many TUPE'd staff losing old terms and conditions.

Doing this is not difficult and you can change conditions, you just have to do it correctly and follow the correct procedures. Be fair but be firm and harmonisation can be acheived, and it does not have to be costly, as we are all going to find in our council tax soon, it can be neutral if it is done properly.

Ian Whyteside