Category: Employment

Grievance Letter And Court Structure Illustrated By Emilio Botin Grupo Santander Banking

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UK employment disputes grievances and court structure is illustrated by the high-profile Chagger v Abbey National plc & Hopkins (2006) legal case, where the Tribunal made a finding of racial discrimination which led to the record 2.8 million compensation award. Abbey Santander banking group (the UK retail bank due to be re-branded as Santander price, and being part of the gigantic Emilio Botin Banco Santander Central Hispano Group, BSCH) terminated Balbinder Chagger’s employment in 2006, asserting compulsory redundancy as the reason. Mr Chagger, on the other hand, believed the true reason behind his dismissal was racial discrimination. Mr Chagger was of Indian origin and worked as a Trading Risk Controller for Santander 2009. He earned about 100,000 per annum and reported into Nigel Hopkins.

An employee who has suffered employment related unfairness and/or discrimination could decide to make an appeal. The initial place of appeal would be to the employer, in the form of a formal grievance. The employee lodges a formal grievance letter with the employer, and the employer is responsible for processing the grievance and deciding the outcome. Thus, the employer is given the first the opportunity to handle the employment dispute and to close it satisfactorily. Mr Chagger’s grievances and issues, however, were simply dismissed out of hand by Emilio Botin Abbey Santander share price.

If the employee and the employer are unable to resolve their employment dispute by themselves, then the employee may appeal to an Employment Tribunal for an objective resolution. UK Employment Tribunals will hear matters about redundancy payments, unfair dismissal and discrimination. Mr Chagger took his matter to the Employment Tribunal by initiating legal action against both Santander Abbey and Mr Hopkins, on the grounds of unfair dismissal and racial discrimination. The Employment Tribunal considered the evidence and ruled that Mr Chagger had in fact been both dismissed unfairly and racially discriminated against by both Abbey Santander and Mr Hopkins. In order to remedy the wrong of race discrimination Santander Abbey had committed, the Employment Tribunal ordered the company to reinstate Mr Chagger. However, Santander Abbey refused to comply with the Employment Tribunal’s reinstatement order. The Employment Tribunal then ordered Abbey Santander to pay Mr Chagger 2.8 million compensation for his loss, as an alternative to reinstatement.

The party that is dissatisfied with the Employment Tribunal’s ruling may appeal to the next higher-level court, being the Employment Appeal Tribunal (EAT). The EAT will look into appeals against rulings made by the Employment Tribunals. The appeals must only be about points of law (i.e., an appeal must only be about mistakes in legal reasoning by the Employment Tribunal). The EAT will not look into matters about facts of the case. In 2008, Santander Abbey and Mr Hopkins appealed to the EAT against the Employment Tribunal’s ruling of racial discrimination and against the record-breaking 2.8 million compensation awarded. The EAT considered the appeals. It upheld the original Employment Tribunal’s ruling that Santander Abbey and Mr Hopkins had racially discriminated against Mr Chagger in respect of his dismissal. However, it accepted Santander Abbey’s appeal concerning the 2.8 million compensation award and decided to send back the compensation amount to the original Employment Tribunal for reconsideration.

The party that is dissatisfied with the ruling of the EAT may make an appeal to the next higher-level court, the Court of Appeal (the second highest court in the land). The Court of Appeal will look into appeals against rulings made by the EAT. As before, the appeals must only be about points of law (i.e., an appeal must only be about mistakes in legal reasoning by the EAT). The Court of Appeal will not look into matters about facts of the case. In 2009, the Chagger v Santander Abbey case was appealed to the Court of Appeal. The Court of Appeal’s List of Hearings showed that the case was heard on 7 and 8 July 2009. The Court of Appeal’s records concerning the outcome of the hearing were not available at the time of writing this article. The 11KBW set of barristers’ chambers (who represented Santander Abbey and Mr Hopkins), had reported that the hearing was to be only about quantum (i.e., compensation) and not liability also (i.e., not racial discrimination also). That would appear to suggest that the wrong of race discrimination committed by Abbey Santander and Mr Hopkins was finalised by the EAT (it upheld the original Employment Tribunal’s finding that Mr Hopkins and Santander Abbey had racially discriminated against Mr Chagger), and that Mr Chagger had appealed against the EAT’s ruling to send back the compensation amount back to the Employment Tribunal stage for reconsideration.

The party that is dissatisfied with the ruling of the Court of Appeal may appeal to the next higher-level court, the House of Lords. Appeals to the House of Lords require the Court of Appeal’s approval. Furthermore, the Court of Appeal must require the House of Lords to decide upon a question of general public importance. As previously, appeals to the House of Lords must only concern points of law and not be about facts of the case. The House of Lords is the highest court in the land and the final stage of appeal for most legal cases in the UK. Occasionally, cases may be approved for appeal to the European Court of Justice, which has jurisdiction on matters of European Community law.

After 1 Year, Obama Vs. Reagan

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As we approach the end of the year, we are also approaching the end of President Obamas first year in office. You might be wondering how he is doing, based on actual numbers (rather than political spin).

Obama clearly inherited a difficult situation economically. Only two others in the modern era came even remotely close. One, of course, was FDR, but unfortunately the data from then is rather sparse, and mostly available on just an annual basis, or at best quarterly (good economic data was one of the by-products of the New Deal).

The other who inherited a difficult economic situation was President Reagan. Granted, the type of difficulty was very different under Reagan, and presidents — like quarterbacks — get too much of both the praise for a good economy and the blame for a bad economy.

Still, I think comparing the numbers for the two during their first “year in office could be instructive. The data I used for the comparison are all available monthly (at least, and if more frequently, I used the monthly data). The source of all data is the St. Louis Fed (except for the S&P 500).

The two presidents offered very different prescriptions for the economy. Reagan was all about cutting taxes and less government involvement in the economy. While most of the really big moves of government into the economy in response to the recent economic crisis actually took place under President George W. Bush, Candidate Obama saw them as needed. The Bush Administration was the one that bought the stakes in American International Group (AIG – Snapshot Report), Fannie Mae (FNM – Snapshot Report), Freddie Mac (FRE – Analyst Report) and the banks, while Obamas support for a prepackaged bankruptcy resulted in large government stakes in the Auto industry.

There were no comparable big investments by the government into the private sector late in the Carter Administration, and certainly Reagan did not initiate any. Reagan did not have to deal with a financial meltdown when he took office, but on the other hand, Obama did not have to deal with runaway inflation. Both are serious diseases, but think of it this way: both cancer and heart disease can kill you, but you would not want to give chemotherapy drugs to a heart attack patient. Thus, perhaps it is appropriate that the prescriptions be different.

If one only looks at the unemployment rate (U-3), both did a poor job in their first year, and Obama was significantly worse. The unemployment rate in January 2009 was 7.6% and by November it had climbed to 10.0%. In January 1981, when Reagan took office, the unemployment rate was almost identical at 7.5%, and by November of 1981 it had climbed to only 8.3%.

Private employment actually rose during the first 11 months of 1981 by 0.55%, from 74.671 million to 75.084 million. Under Obamas tenure so far, private payrolls have dropped by 2.95% to 108.495 million from 111.793 million.

So on the employment front, Reagan is the clear winner so far. However, over the course of 1982 and 1983 the employment situation deteriorated significantly. We do not know what unemployment will do in 2010 and 2011, and thus can only judge based on what we have seen so far and in the comparable period under Reagan.

Advantage: Reagan

Reagan also wins when it comes to real disposable personal income, which expanded by 2.3% in the first 11 months Reagan was in office, while it has only increased by 1.0% so far under Obama.

Advantage: Reagan

The dollar was also much stronger during the first 11 months of Reagan, although I am not sure if that is a positive or a negative. During the first 11 months of Reagan, the dollar relative to an index of major currencies gained 9.88%, while under Obama, the dollar has lost 9.70% relative to the same index.

Given that we are running chronic trade deficits now, but really were not back then, I would argue that today a weak dollar is good for the economy today since it will help out on the net export side of things. Inflation is not a big problem today, but was the number one problem with the economy when Reagan took office. The downside of a weak dollar is that it contributes to inflation, so back then having the dollar strengthening was a good thing.

No Advantage to Either

On the inflation front, however, things are far better under Obama. On a headline basis, prices have gone up by 2.39% so far under Obama, while they rose 7.57% during the first 11 months that Reagan was in office. On a core basis (ex-food and energy) the difference is even more stark, rising 8.31% under Reagan and up just 1.51% under Obama so far. Later in the Reagan Administration, inflation fell much more, but even when he left office in 1989 inflation was far higher than it is today.

Advantage: Obama

Industrial production fell slightly more during the first 11 months of Reagan (1.07%) than it has under the first 11 months of Obama (0.68%). Capacity Utilization started out at a much lower level when Obama took the oath than the Reagan did, at 71.1% (an all-time record low at the time) vs. 80.7% when Reagan took office. However, by November of 1981, the total capacity utilization rate had fallen to 77.9%. Under Obama, capacity utilization has actually risen to 71.3%, although it remains at a historically low level.

Advantage: Obama

Interest rates can tell a lot about the state of the economy. For example, the spread between the rate that gilt-edged companies have to pay on their bonds and what normal companies have to pay on their bonds tells a lot about how much bond investors fear companies going belly up. The former is measured by the Moodys (MCO – Analyst Report) Aaa rate and the later by the Baa rate (not to be confused with “junk bond” rates; Baa is still investment grade).

In January of 1981, the best credits in America had to pay 12.81% on their bonds, while normal companies had to pay 15.03%, for a spread of 2.22% (or as a ratio, normal companies had to pay 17.3% more than the gilt-edged ones). By November of 1981, both the best and the ordinary had to pay more — the Aaa rate had surged to 14.22% while the Baa rate had risen to 16.39%, so the spread had fallen ever-so-slightly to 2.17. The ratio had come down a bit more, and the ordinary firms were paying 15.3% more than the best firms.

When Obama took office, the Baa rate was 8.14% while the Aaa rate was 5.05%, for a spread of 3.09. In other words, ordinary firms had to pay 61.2% more for money than the best firms did. Investors were very afraid that companies would go bankrupt, and so demanded a higher rate from normal companies than from firms that seemed to have very little risk of writing a new chapter (the eleventh) in their corporate histories.

Since then, the rate the highest-rated firms have to pay has actually increased slightly to 5.19% while the rate that normal firms have to pay has plunged to 6.32%, bringing the spread down to 1.13% and the ratio down to the point where normal companies are paying 21.8% more for their money than the Aaa firms.

(Given the huge difference in the overall level of interest rates between the two eras, it is important to look at both the spreads and the ratios. Clearly a spread of 2% has a very different meaning and significance if it is between 1% and 3% than if it is between 13% and 15%).

Advantage: Obama

Another important signal that comes from interest rates is the yield curve, or the difference between long-term and short-term interest rates. The curve is measured using Treasury notes or bills, since you only want to be looking at the differences due to maturity, not due to quality (the opposite of the Aaa-Baa spread, which is only looking at quality differences, not maturity differences).

While there are many different measures of the curve, the one that is used the most is the difference between the 2-year note and the 10-year note. Generally speaking, the steeper the yield curve, the better. An inverted yield curve is very bad news, and is probably the best single indicator that the economy is about to go into a recession.

When Reagan entered office, the 10-2 curve was inverted, with the yield on a 2-year note at 13.26% and the yield on the 10-year at 12.57%, for a spread of -0.69. On a ratio basis, the 10-year was providing only 0.95 of the 2-year. By the time November of 1981 rolled around, the curve had returned to normal but was still pretty flat. The yield on the 2-year had fallen to 12.88%, while the yield on the 10-year had increased to 13.39, resulting in a positive curve of 0.51. On a ratio basis, the 10-year was 1.08 of the 2-year.

When Obama entered office, the 2-year was at a very low 0.81% while the 10-year was 2.52%, for a positive spread of 1.71%. On a ratio basis, the 10-year was yielding over three times as much as the 2-year (3.11x to be exact). By the end of November, the curve had expanded even further, with the 2-year virtually unchanged at 0.80%, while the yield on the 10-year had risen to 3.40%, for a spread of 2.60% and a ratio of 4.25x. Again, given the vastly different overall levels of rates, it is important to consider both the spreads and the ratios when making the comparisons.

Advantage: Obama

Mortgage rates were both far higher and moving in the wrong direction early in the Reagan presidency. When he took office they were at 14.90%, and by November they had risen to 17.83%. When Obama took office, the rate on a 30-year fixed mortgage was 5.06% and has since fallen to 4.88%.

Not surprisingly, then, the housing market was far worse under Reagan than it has been under Obama (at least if measured by direction, not levels). In January of 1981, housing starts were running at a seasonally adjusted annual rate of 1.547 million, and by November of that year they had plunged to 837,000, a decline of 45.9%. Since January of 2009, housing starts have risen from an annualized rate of 488,000 to a rate of 574,000 in November, an increase of 17.6%.

Advantage: Obama

Similarly, single family new home sales plunged by 25.2% early in the Reagan years to a rate of 382,000. Since Obama came into office, new single family home sales have risen by 22.2% to an annualized rate of 402,000. Existing home sales are not particularly important to the economy (just like used car sales are not very important).

Auto sales also fared worse under the early part of the Reagan Administration than they have so far under Obama (at least as measured point-to-point). When Reagan took office, auto and light truck sales were running at an annualized rate of 11.03 million and had fallen to 9.21 million, a decline of 16.5%. Under Obama, auto and light truck sales have risen from an annualized rate of 9.59 million in January to a rate of 10.89 million in November, an increase of 13.6%.

Advantage: Obama

Finally, while people sometimes make too much of the day-to-day fluctuations in the stock market, it is a good reflection of the overall health of the economy when you look at longer time periods — and almost a year is long enough to qualify there. On that metric, there is simply no contest. Between inauguration day and Christmas Eve in 1981, the S&P 500 lost 7.65%. Since Obama took office, the S&P 500 has gained 39.9%.

Advantage: Obama

Weighing these different economic indicators is inherently subjective, and thus I am not sure that one can come to a clear-cut case that one has done a better job than the other — at least so far. This is also far from a complete list of economic indicators and I focused on only those that were available at least monthly, and many of the most important economic numbers come out quarterly.

Arguably, the economic mess that Obama inherited was worse than the one that Reagan inherited, although both were pretty nasty — yet very different. The U.S. economy is more of an oil tanker than a speedboat, and does not turn around on a dime, so it really is too early to tell how Obama is doing.

However, the indicators that are most forward-looking and leading for the economy (stock market, yield curve and quality spreads, housing starts) are the ones that favor Obama over Reagan. Overall, 11 months in, one must conclude that Obama is doing at least as good a job on the economy as Reagan did in his first 11 months.

How Interest rates affect the employment market- The UK Knack Group

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The UK Knack Group would like to provide some insight into how interest rates affects employment levels. The association between the two is very easy to understand.

A larger-than-expected decrease in the monthly employment rate causes interest rates to increase.

More employed people are putting more money into circulation. An increase in available cash means there are more pounds chasing the same amount of goods as were available the previous month.

Employers like The UK Knack Group require time to ramp up operations to meet the increased demand. In order to employ additional staff, companies may have to borrow money over the short term in order to meet payroll expenses or acquire more raw materials. In the case of UK Knack Group, people are its product and this effect is more easily seen.

Lenders experience an increase in loan requests. In this case, borrowers like The UK Knack Group are increasing demand on available money which results in higher interest rates charged by the banks and other lenders.

At the same time, central government lending agencies will raise their lending rates after analysing the bond markets, a move calculated to forestall inflationary forces. Banks borrow from the central lending agencies at a higher rate of interest and pass on the additional expense to their own borrowers such as UK Knack Group.

However, lower unemployment may affect interest rates more indirectly. Companies ramping up operations are often short of employees for a time who demand higher salaries.

Higher wages may drive prices higher. Again, more money is chasing fewer goods. Inflation may result, depressing the stock market.

Companies with lower cash flows coming in may need to borrow. Once again, banks begin lending at a higher interest rate to meeting the higher demand for loans.

When unemployment rates are around the -natural rate- of around 5.5% as determined by economists, interest rates remain stable, according to UK Knack Group information. This is called -equilibrium.- When that rate decreases, interest rates go up. Similarly, when unemployment increases, interest rates go down. They are inversely related, in other words.

UK Knack Group gives an example of this process. When the unemployment rate is above 5.5%, those who are out of work cut back on expenditures, lowering demand for goods and services. For instance, a family with an unemployed salary earner is less likely to dine out at a restaurant, which in turn requires fewer staff and food for preparation.

Consequently, farming and food-distribution families cut their expenditures, further depressing demand. There are fewer requirements for goods all along the supply chain, The UK Knack Group explains.

UK Knack Group provides an example of a economic turnaround as well. An office experiences a sudden increase in demand for its services and recalls some staff.

These staff now have higher expenses related to going to work every day such as commuting costs, updating career attire, and buying meals outside the home. Transportation companies, shops,and restaurants experience a higher level of business and call back unemployed workers.

At each level, more staff put more money into circulation and everyone wants to buy something, often at a higher price than before. Credit cards, a form of borrowing, are used to pay for goods and services.

Restaurants and shops may borrow money to meet short-term current expenses. Their suppliers extend credit for a few weeks, but they must add a certain percentage as interest. Suddenly, everyone is chasing money, and increased demand, and the cost of borrowing money goes up as well.

The Knack Group UK hopes these illustrations make understanding the interplay between unemployment and interest rates easier to understand.

About Author The Uk Knack Group consists of some of the most experienced professionals in the UK and abroad who have helped thousands of businesses and people to be more successful through Executive Search and Selection, Headhunting, Transitional Outplacement, Executive Career Management and Professional Training & Coaching. www.theukknackgroup.co.uk

Understanding The Definition Of Employment At Will

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Like with most legal jargon, “employment at will” has both a formal definition and a practical one. In this case, the theory is easy. The basic definition of “employment at will” says the employer or the employee may end the working relationship at any time and for any reason without fearing legal action. This means the employer can fire or lay off the employee whenever they want. According to the theory, the employers do not have to explain why they fired their worker.

This definition also claims the employee may choose to quit his or her job at any time. Under such circumstances, the worker does not have to give the employer the reason for leaving his or her current position.

On its face, this is a simple law that should work for both the employer and the employee. Unfortunately in practice, “employment at will” is not so clear. While most states follow the formal definition, many lower courts have passed laws to cancel the employer’s rights. All of these laws have created many exceptions to the formal definition, and employers must keep this in mind if they need to fire someone.

Definition of Employment at Will: What It Means For Employers

So what does this mean for you, the employer, if you need to fire an underperforming employee? It’s simple. Wise employers do not fire employees without a reason and claim protection under “employment at will”. This is true even if you live in an “at will” state.

Almost every “at-will” state has exceptions an employer must consider. To make the situation more complex, these exceptions vary widely from state to state. It is a good idea to contact your state’s labor office to find out the laws that apply to you.

If you fire an employee and that person becomes angry, you could find yourself in a wrongful termination lawsuit. And as an employer, you don’t want these legal proceeding to go to court. Most courts favor the employee. This leaves the employer at the losing end and that costs time, money and productivity.

So how do you avoid such lawsuits? It’s a good idea for all employers to have standard termination procedures in place.

First, make sure you have an employee handbook with rules and regulations of the workplace. All employees must be aware of its contents. Second, make sure no manager fires an employee without giving a reason. Third, have standards in place so the reasons for termination are legal and fair. Fourth, train all managers in progressive discipline. Using this proven method, an employee termination will never take a worker by surprise. This will reduce their overall anger at the company.

It is true that “employment at will” suggests an employer doesn’t own an employee an explanation for losing his or her job. However, this simple definition does not translate directly into practice. Never depend on the formal definition of this law to protect you from a wrongful termination lawsuit.

Singapore Employment Pass How To Get Approved

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The Ministry of Manpower grants Singapore Employment Pass that is usually valid for one to two years to eligible applicants. Employment Pass provides comfort to foreigners in terms of travelling in and out of the country. The work visa is renewable as long as the pass holder remains employed in a Singapore company. It also provides chance to pass holder to apply for a permanent residence status.

Employment Pass is required for any entrepreneur who has just incorporated a Singapore company and desires to move to Singapore. Moreover, the work visa is also required for corporation looking to relocate their staff such as managing directors and management staff of the company.

We have provided basic considerations on how to be qualified, eligible and how to get approved for a Singapore Employment Pass. Please read on and take note of these details:

Eligibility Requirements:
Recognized educational diploma/degree
Professional qualifications
Specialist skills

Basic Considerations Assessed by The Ministry of Manpower:
Salary
Age
Roles & responsibility
Related work experience
Companys background
Companys paid up capital
Current citizenship

Basic Documents to Furnish:

The above qualifications should be satisfied first before securing the following documents: resume or CV stating your educational and employment history, copies of educational certificates and past employment testimonials, and a copy of your passport details. However, any documents that are not in English must be translated into English by an official translation service. In addition, there are three Employment Pass groups, P! for applicants earning a salary of more than S$7,000, P2 for salary of more than S$3,500 up to S$7,000 and Q1 for salary of more than S$2,500.

Service of a Professional Firm:

For processing of your application, you need to hire the services of a professional firm who will apply in your account for your Employment Pass. They will be the one to apply online to The Ministry of Manpower, as the application method is shorter. It normally takes 1 to 15 days to issue an approval. Once approved, the Ministry of Manpower will issue an In-Principle Approval (IPA) letter via email. The IPA letter must be produced upon collection of the EP at the Work Pass Division at Ministry of Manpower. An IPA letter is valid for Six months from the date of notification of approval.

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