The 2014 party promised to be an interesting one with all the intrigue of a masked ball. Even though celebrities like Shared Parental Leave and Equal Pay Audits were announced in advance, nobody really knew what to expect. Article by By Sarah Henchoz, Partner and Sheila Fahy, PSL Counsel Allen & Overy.

These established personalities promised something new on the cat walk. 2014 didn’t have the glitz and glamour of past years like 2010, where everyone was star struck by the Equality Act, or 2013 where whistleblowing was the word on everyone’s lips. Instead, 2014 distinguished itself by its under-statedness. It was an opportunity for B-listers like holiday pay cases, to punch above their weight, and the unknown quantity of gate-crashers like obesity and zero hours contracts who, despite not being invited, stole the show and made sure they will be VIPs in 2015.

Without any doubt, shared parental leave is the big ticket number for 2014/2015. Radical initiatives like this usually originate in Europe but this time, it is a home-grown idea from the Coalition Government. Coming into force at the start of the party season on 1 December, but applying to babies born on or after 5th April, 2015, it re-thinks and shakes-up the traditional workplace view that it is the woman who is left holding the baby. The two weeks following birth remain exclusively reserved for the mother as you would expect. Other than that, the remaining 50 weeks of maternity leave can be shared by the parents as they wish. They can take it together, separately, or on rotation. For discontinuous period leaves (eg leave that is not taken in a single block) the employer needs to agree to the leave pattern.

Although take-up is predicted to be low, businesses are worried about the new arrangements. At least with maternity leave, the chances were that a woman would be absent for one year and suitable cover could be obtained. The same predictability cannot be applied to shared parental leave, making planning difficult. The issue is further complicated by the question of pay – do you simply pay statutory shared parental leave pay during a period of shared parent leave or do you mirror any enhanced company maternity pay arrangements? The jury is out on this one with the courts ruling that the correct comparator for a man on shared parental leave is a woman who is also on shared parental leave and not a woman on maternity leave, thereby finding that paying statutory as opposed to enhanced pay is lawful even if a woman who is absent on maternity leave for the same period would get more. Some employers however are deciding to pay enhanced pay during shared parental leave if only to try and encourage more people to take advantage of it which would be consistent with their diversity agendas.

The potential impact of equal pay audits does not appear to have registered with either employers or employees. The new regime requires employment tribunals to order an equal pay audit if an employer loses an equal pay case. And then the audit results have to published on the employer’s website and remain there for three years. One of the exceptions is where an employer has already carried out an audit within the preceding twelve months. We expect the risk of being ordered to undertake such an audit will be factored into settlement discussions.

It was the humble right to paid holiday that shone bright in 2014. The cases of Lock v British Gas and Bear Scotland v Fulton (and other conjoined cases) had businesses quaking in their metaphorical boots at their potential exposure for incorrectly paid holiday, potentially going back to 1998. The Working Time Regulations were drafted to make it clear that holiday should be paid on the basis of basic remuneration. Europe threw a spanner in the works in the summer by ruling that where commission was intrinsically linked to a role, it must be taken into account when calculating holiday pay. More recently, the EAT said that non-guaranteed overtime must also be factored in. This only applies to 20 days holiday under Working Time Regulations, and the remaining eight days or any additional contractual holiday can be paid at the basic rate. Much to the relief of employers, the EAT limited the potential liability for back-dated pay by saying that if there is a break of more than three months in the series of deductions between the underpayment and the correct payment, the link in the series is broken and claims would be out of time.

Almost out of the blue came two new celebrities: obesity dressed as a protected characteristic and zero hour contracts. Both hit the 2014 scene with significant impact. The Small Business, Enterprise and Employment Bill 2014-15 includes a proposal to ban exclusivity clauses in zero hour contracts, which prevent a worker from working for another employer. The Bill is currently passing through its legislative stages and is expected to become law in 2015. With UK obesity rates reaching epidemic proportions, it is hardly surprising that the issue would spill over into the workplace. In 2013, the EAT ruled that whilst obesity is not a disability, physical and mental impairments associated with obesity may well be covered. This was taken a step further in 2014 by the Advocate General in an ECJ preliminary decision in which the view was taken that morbid obesity may amount to a disability in its own right if it significantly impacts on the person’s working life. The final decision is expected in 2015, which means obesity will continue to make waves well into the new year.