What pregnancy and maternity rights does a partner have?
A partner is a business owner and employer, which by definition means they are not an employee. As a consequence, partners do not benefit from all the various employment protections afforded to employees. Despite this, we are often asked about partner entitlements, particularly regarding maternity and childcare.
What is the legal position?
Partners do not benefit from statutory maternity and childcare entitlements, although they are protected from being discriminated against by reason of their pregnancy and maternity, gender and marital status under the Equality Act 2012.
Broadly speaking, the Equality Act provides that women should not be subject to “less favourable treatment”, or subject to unreasonable requirements that they cannot meet because of their pregnancy/maternity or childcare commitments.
The majority of the maternity rights for a partner will be set out in their partnership agreement. These will be binding unless they are found to be discriminatory. In the absence of a partnership agreement, there are very few automatic rights that will accrue.
Common Issues
Particular issues where liability under the Equality Act could accrue include:
- Not engaging or promoting someone to Partner because of concerns that they will be absent due to maternity leave, or won’t be able to “pull their weight” because of childcare commitments;
- Not allowing for any maternity leave at all or a very short period only;
- Not allowing a female Partner who has a pregnancy related illness the same sickness absence entitlements as other sick Partners;
- Reducing profit share during maternity leave;
- Not accruing holiday leave during maternity leave;
- Not allowing a partner to work part time or change session times to deal with childcare commitments.
None of the above are entirely clear-cut and would need to be looked at on a case-by-case basis. For example, the Equality Act certainly indicates that holiday leave should accrue in the normal way during some of a partner’s maternity leave, but it is less clear whether this would accrue during the entire period of their absence.
Practices should be aware that they can claim under the SFE for payments to cover locum expenses during maternity, paternity and adoption leave. The common practice is that the absent partner continues to receive profit share whilst the SFE payments are being received. However, if you wish to do this, you will have to ensure that this is set out in your partnership agreement.
Conclusion
This is an area of law that is both complex and uncertain. There is only a limited amount of case law applying specifically to Partners, so each case is likely to be determined on its own merits.
Practices should be very wary of opening themselves to the risk of a discrimination claim, as these have unlimited liability. The best protection is to:
- Ensure that the practice has a clear non-discrimination policy in place which includes discrimination on the grounds of maternity and childcare commitments.
- Make clear that this policy applies to all staff, including partners.
- Ensure that the Partnership Deed is professionally prepared, that it is clear on the subject of maternity and other forms of leave, and that it is kept reasonably current as the law changes. Anything drafted more than 3 years ago may well be out of date with current best practice.
If you have any questions about this or any other matter, please contact Daphne Robertson on 01483 51155 or d.robertson@drsolicitors.com
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Does your professional indemnity insurance put you in breach of your employment contract?
GP practices and salaried GPs are advised to check the terms of their employment contracts if employed clinical staff are considering taking out “claims made” insurance, such as that recently offered by the MDU.
In a previous blog, we looked at the broader implications of claims-made insurance policies (Will you or your practice be impacted by the MDU policy changes?). However, another potential consequence, which we’ll be focusing on here, is how claims-made policies may inadvertently put salaried GPs in breach of their employment contract.
So, what exactly is the issue and what action should you take?
Current employment contracts
The ‘BMA Model Employment Contract’ states that “The practitioner will maintain full registration with the General Medical Council and membership on an occurrence based basis with a recognised medical defence organisation commensurate with your responsibilities”. (What is the BMA model contract and does it apply to me?)
This point is regarded as so important, that it is repeated in both the BMA model contract and in the BMA model offer letter. It is clear that the BMA negotiators assumed that all salaried GPs would be insured on an occurrence based basis – i.e. a policy that offers protection for any incident which occurs during the policy period, even if the claim is filed after the policy has ended.
Since all GMS practices, and many PMS practices, are required by their provider contracts to engage their salaried GPs on employment contracts that are ‘no less favourable’ than BMA model terms, it is likely that most salaried GP contracts will include a similar clause.
As a consequence, if a salaried GP moves to a claims-made indemnity policy, they may be unwittingly breaching the terms of their employment contract.
Our recommendations
As a first step, we would advise all practices and salaried GPs to look at their employment contracts and Staff Handbook, to see whether there is a requirement for employees to have an occurrence based indemnity policy.
If the requirement is included, practices need to have procedures to ensure compliance. The BMA model contract states that salaried GPs should provide “written proof and evidence of such membership”, so practices would be free to request this.
If there is currently no written requirement, practices should consider whether they are content to allow salaried staff to move to a claims-made contract or not, and employees should consider whether they wish to make the move. This is a question of understanding the risks involved, such as whether the employing practice is exposing itself to more risk by permitting claims made policies. All parties would be well advised to speak to a specialist IFA to fully understand this.
Practices which do not currently require occurrence based policies but wish to do so going forward will need to consider making changes to their employment contracts. We recommend that you always seek appropriate legal guidance before doing this.
If you are at all unsure about any of the issues we have covered here and how they might affect your practice, then please do not hesitate to get in touch.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Salaried vs Fixed Share Partners
Managing partnership changes and staffing are two of the most common issues any practice will deal with and how they are handled can have long term implications, especially in relation to a new partner joining the business.
One area that can cause confusion is the difference between a ‘Salaried Partner’ and a ‘Fixed Share Partner’. The two terms are often used interchangeably, but they are very different and it’s important that a distinction is made.
Here, we look at the key differences and the implications they may carry for your practice.
What is a fixed share partner?
A fixed share partner is an owning partner in the business. As such, they should sign the Partnership Deed and will have whatever rights and obligations are stated therein.
- As a partner they won’t have employment law protection
- They will have an agreed minimum monthly income and additionally some form of profit share
- They will share in the losses but may be indemnified against some or all of these by the other partners
- They will have injected some capital into the business
- They will be entitled to attend meetings and to participate in partnership decisions
- They will have voting rights
- They will not be controlled by other partners
- They will be taxed as self-employed individuals
- They will be entitled to opt in to the NHS partner pension scheme
- They will have some ownership over the GMS contract and potentially also the PMS contract
What is a salaried partner?
In contrast, a salaried partner is normally a title given to a senior employee. As such, they won’t sign the partnership deed and will be working under some form of employment contract (even if it is called something else).
- They will be entitled to a salary and potentially some bonuses – although usually not related to profit
- They will have full employment law protection
- They will be at no risk of sharing any losses
- They shouldn’t have any voting rights in the partnership and there will be elements of control by the other (owning) partners.
- They are taxed as an employee paying PAYE & NI
- They are entitled to opt in to the NHS employee pension scheme
- They will have no ownership over the GMS contract and would not normally have any interest in the PMS contract
- They must guard against third parties regarding them as ‘real’ partners and thereby inadvertently becoming liable for the partnership debts.
Why does it matter?
Typically, what practices are trying to achieve with a Fixed Share Partner is a partner who has many of the characteristics of an employee, while a Salaried Partner will typically be an employee with some of the characteristics of a partner. The problem is that the law only recognises employees or partners, there is no middle ground.
The most important point to remember is that the title itself does not determine the real status. That can only be established by analysing the detail of the arrangement.
If a title is mismatched to the actual legal status of the person, there is a risk of creating legal uncertainty. This could lead to any number of future problems, most of which will be costly to resolve.
Our recommendations
We will consider the pros and cons of each option in a future article, but our main piece of advice for anyone considering appointing or becoming a fixed share or salaried partner, is to ensure you are clear from the outset about the outcome you are seeking to achieve.
The starting point is to decide whether you are welcoming a new partner, or a form of senior employee. All other aspects of the role flow from there, and it is important to ensure that you don’t accidentally incorporate key features of one type into the other. This is all too easily done and the consequences of getting it wrong can be serious.
If you’re going to make staffing changes, especially if those changes are to a ‘partner’ role, please make sure you seek specialist advice to ensure the arrangement is documented appropriately.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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PMS contractors and the BMA model contract
The BMA model contract is a topic we recently covered in our blog: ‘What is the BMA model contract and does it apply to me?’.
Many PMS contractors assume the need to provide such a contract does not apply to them. However, the issue isn’t quite so clear cut and this may be leading some practices to inadvertently put themselves at risk.
In this post, we look at the issue in more detail to help clear up any confusion.
Which PMS contractors does the BMA Model contract apply to?
While all GMS contractors must offer the BMA model employment contract – or ‘terms no less favourable’ – PMS contractors are only obliged to if it has been stated in their contract.
In our experience, problems arise when a practice is unaware what is written in its contract. This can lead to salaried GPs being employed on non-BMA model contracts, despite there being a contractual obligation to do so.
Any PMS contractor who has signed the NHS England Standard PMS Agreement 2015/16 will have the obligation, and indeed the majority of PMS contracts we have seen over the last few years include it.
Sometimes practices can accrue the obligation unwittingly. For example, if a practice has signed a new contract following a PMS review they may not realise that the clause has been included and that they should move all their salaried GP staff onto new employment contracts.
What are the implications?
If salaried GP staff believe they are being underpaid, or have the incorrect contractual provisions, then they may seek to take action.
Whilst there is some debate about who can enforce the BMA model contract clause, there is the potential for NHS England to issue a contractual breach notice if they become aware that a PMS contractor is not offering the terms they should.
Most PMS contracts have a clause preventing third parties (such as employees or patients) from enforcing the terms of the PMS contract, however we are aware that some do not. In this case it may be possible for an aggrieved employee to enforce the clause directly, which could lead to a successful claim for historic loss of earnings.
With changes in partnerships, mergers and super-partnerships, where any such liability actually falls would be a complex legal issue to resolve.
Our recommendations
If you’re a PMS contractor and you are not sure what your current status is, then start by looking at the most recent version of your contract. Check whether or not it specifies that you have an obligation to offer the BMA model contract.
If it does and you are in breach, then we would recommend you seek advice from a specialist legal team, who will be able to guide you on your options and the best way forward.
For more information, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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What is the BMA model contract and does it apply to me?
The BMA model contract was introduced in 2004 to try and ensure a common standard for GPs employed by practices and those employed by PCOs. The PCOs have since become CCGs and NHS England, and they no longer employ significant numbers of GPs. Nonetheless, the BMA Model Contract has endured. All practices which it applies to must offer their salaried GPs the BMA model employment contract, or ‘terms no less favourable’.
Over the last 10 years the profile of the profession has changed drastically. There are now many more salaried GPs than ever before and most of them should probably be on BMA model contracts or similar.
Who does it apply to?
It is an express term of all GMS Contracts that the GMS Practice must offer their salaried GPs BMA model contracts or terms no less favourable.
The definition of a salaried GP includes:
- Salaried GP who undertakes special interest work (a GPwSI)
- Assistant
- Associate
- GP retainee
- Flexible Career Scheme GP
- Returner scheme GP
- Salaried GP employed to work out-of-hours.
PMS and APMS practices
The position for PMS and APMS practices is more complex. The NHS England Standard PMS Agreement 2015/16 contains the same requirement as GMS, but most PMS practices hold different, older contracts.
The original intention was that PMS would be locally negotiated. Some local commissioners included a clause requiring BMA Model Contracts in their PMS contracts, whilst others did not.
The only way to be sure is to read your PMS or APMS Contract – something very few practices ever do.
Is it a standard template?
The BMA model contract is a downloadable template document, but it doesn’t have to be used in its exact form. The phrase ‘no less favourable’ means it can be varied and negotiated. The employee and employer might agree to change some of the terms, perhaps trading some leave for pay and so on. In the end it is up to the parties to decide whether they regard a change to the model as a favourable one or not.
We generally advise practices to carefully consider the wording of the contract rather than simply adopting it wholesale. There are some important employer protections which are found in most other employment contracts and which are not in the BMA Model. Also, you will probably want to ensure that your salaried GPs are not on radically different terms to your other clinical and possibly also non clinical employees.
What if you get it wrong?
If the requirement is in your GMS/PMS/APMS contract and you employ salaried GPs on terms which are less favourable than the BMA model contract, then you are in contractual breach. If NHS England become aware of this, they will almost certainly issue the practice with a ‘Remediation Notice’. This will require you to rectify the situation within a given timescale and sanctions could also be imposed. If 2 or more breach or remediation notices are issued NHS England would be entitled to consider termination of the contract.
Recommendations
If you are a GMS Contract and are not offering the BMA Model Contract or terms no less favourable, you should consider taking steps to rectify the situation.
If you are a PMS or APMS practice then your first step should be to check your NHS E contract to see if the BMA model applies.
Aim to have an open discussion with the person you’re looking to employ, to negotiate the terms that will be most favourable for both parties. You need to find a positive balance between the best interests of the practice and the individual. Just remember that overall, the terms and conditions must be deemed ‘no less favourable’ than those set out in the BMA model contract.
In general this is a surprisingly tricky area of law, and something which both employer and employee can get very exercised about. If you’re at all unsure about your situation, then always seek the advice of an experienced legal team who will be able to assist you.
For more information about employment contracts, any other related issues, please contact Daphne Robertson on 01483 511555 or email d.robertson@drsolicitors.com
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Is your practice prepared for the changes to IR35?
Significant changes to tax legislation IR35 are likely to come into force from April 2017. These changes have implications for any practice that engages workers, such as locums, through their own companies.
Here’s what you need to know: