News & Views

Employment Law Case Update – March 2024

Employment,
24th March 2024

Employment Law

This month’s case updates include a case of unfair dismissal which sparked a debate over the bounds of reasonable responses of an employer in dismissing an employee for posting a racist ‘joke’ on an intranet, we scrutinize parental leave protection against dismissal, look at whether employers can be held vicariously liable for detriments amounting to dismissal caused by co-workers in whistleblowing cases, and take a look at the potential discrimination of a Christian actor removed from a role due to anti-gay social media posts, although she admitted she would never had played that role anyway. Lastly, looking at Equal Pay, we investigate the ‘material factor defence’.

Unfair Dismissal: Band of Reasonable responses
Parental Leave: Protection against dismissal can arise before employee gives notice to take parental leave
Whistleblowing: Employer cannot be vicariously liable for detriment caused by act of co-worker which amounts to dismissal
Discrimination: Fired ‘Color Purple ‘actor loses appeal over Christian beliefs
Equal Pay: Identification of decision-maker is not essential to material factor defence

Unfair Dismissal: Band of Reasonable responses

In Vaultex UK Ltd v Bialas [2024] EAT 19 the question before the EAT was whether the original tribunal had been entitled to decide that a decision to dismiss an employee for posting a racist ‘joke’ on his employer’s intranet fell outside the band of reasonable responses.

The Claimant posted a racist joke on the Respondent’s intranet, which was used by all its employees. The Respondent was a large company which conducts cash processing. The Claimant had a long, unblemished service record and apologised for his actions but nonetheless, the Respondent decided to dismiss the Claimant for gross misconduct.

The tribunal held that the Claimant had been unfairly dismissed, and had even directed itself, citing pertinent authority, that, in relation to sanction, a band of reasonable responses approach should be applied, and that the tribunal “must not simply substitute its judgment for that of the employer in this case”. The tribunal concluded that, given the Claimant’s record and the fact he had apologised, any sanction above a final written warning fell outside the band of reasonable responses that a reasonable employer could have reached.

The Respondent appealed. The first ground of the appeal was the assertion that the tribunal nevertheless committed the error of substituting its own opinion of the appropriate sanction for that of the Respondent. The second ground was that, on the question of whether the sanction of dismissal was within the band of reasonable responses, the tribunal reached a conclusion which was perverse or not within the range of reasonable decisions open to it.

The EAT found that this was not a case where the tribunal found that there was unfairness because a relevant circumstance was not considered by the employer at all. To the contrary, the tribunal specifically found that the Claimant’s long service and the fact that this was a first offence were taken into account by the Respondent. Secondly, given that the tribunal found that the Respondent’s policies and procedures made it clear that conduct of this sort was considered to be potentially so serious that it could result in dismissal for a first offence, and, indeed, that they explained that, even if not directed at another employee, such conduct might amount to discriminatory harassment of colleagues exposed to it, and that this post was placed on an intranet used by the entire workforce, they did not find that it was reasonably open to the tribunal to conclude, if it did, that the Claimant’s prior clean record of long service meant that dismissal was outside of the reasonable band of responses.

The EAT therefore held that the tribunal had, in fact, substituted its own view for that of the Respondent and upheld both grounds of appeal. The EAT concluded that “any tribunal properly applying the law could not have concluded other than that dismissal, however harsh the tribunal might think the decision, was within the band of reasonable responses open to the employer in this case“. It held that the response was within the band of reasonable responses and therefore substituted a finding of fair dismissal.

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Parental Leave: Protection against dismissal can arise before employee gives notice to take parental leave

In Hilton Foods Solutions Ltd v Wright [2024] EAT 28 the EAT had to consider how protection from dismissal arises regarding parental leave. An employee is protected against being dismissed because s/he took parental leave. In broad terms, an employee is also protected if s/he ‘sought’ to take parental leave, pursuant to regulation 20 of the Maternity and Parental Leave Regulations 1999 (MAPLE Regs), SI 1999/3312. His Honour Judge Tayler noted that this appeal raises one point of construction; what is required for an employee to have ‘sought’ to take parental leave? The Respondent argued that the employee must have complied with certain formal requirements of the MAPLE Regs that are a prerequisite of exercising the right to take parental leave. The Claimant (Mr Wright) argued that whether an employee has sought to take parental leave is a question of fact for the appreciation of the Employment Tribunal having considered all the relevant evidence.

The EAT held that the use of the word ‘sought’ was of an ordinary English construction and therefore the question of whether an employee has ‘sought’ to take parental leave for the purposes of this regulation 20 should be based on a factual determination made by the employment tribunal having considered the relevant evidence and circumstances. In addition, it concluded that there is no absolute requirement that the employee must have given notice to take parental leave pursuant to paragraphs 1(b) and 3 of MAPLE Regs, Schedule 2.

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Whistleblowing: Employer cannot be vicariously liable for detriment caused by act of co-worker which amounts to dismissal

In Wicked Vision Ltd v Rice [2024] EAT 29, the Claimant brought a claim of automatic unfair dismissal against the Respondent on the basis that he was dismissed because he had made protected disclosures. The Claimant later tried to amend his claim, to add that the act of the dismissing officer in dismissing him was a detriment on grounds of whistleblowing for which the Respondent was liable. The tribunal allowed the amendment.

At appeal, the EAT disagreed with the tribunal and held that:

a claimant cannot claim that their employer (a company) is vicariously liable under section 47B(1B) of the Employment Rights Act 1996 (ERA 1996) for the act of a co-worker (in this case the company’s owner) for the ‘detriment of dismissal’; and
such a claim is barred by ERA 1996, s 47B(2) because the alleged detriment ‘amounts to dismissal (within the meaning of Part X)’ of ERA 1996.

Therefore the correct claim was the one originally made by the Claimant.

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Discrimination: Fired ‘Color Purple’ actor loses appeal over Christian beliefs

In Omooba v (1) Michael Garrett Associates Ltd (ta Global Artists) (2) Leicester Theatre Ltd [2024] EAT 30 the EAT held that a theatre company did not discriminate against a Christian actor when it dropped her from a role in a musical production of ‘The Color Purple’ over an anti-gay social media post.

The Claimant was an actor, cast to play the role of Celie in the stage production of ‘The Color Purple’. Celie is seen as an iconic lesbian role and, when the claimant’s casting was announced, a social media storm developed relating to a past Facebook post in which she had expressed her belief that homosexuality was a sin. The consequences of that storm led to the termination of the Claimant’s contracts with the theatre (the Second Respondent) and her agency (the First Respondent). Arising out of those events, she brought Employment Tribunal (“ET”) claims of religion and belief discrimination and harassment, and breach of contract. Shortly before the ET hearing, having only then read the script, the Claimant volunteered she would never in fact have played the part of Celie, and would have resigned from the role in due course. She continued with her claims, but these were all dismissed and an award of costs made against her.

The Claimant appealed against those decisions, and against a further order relating to the continued use of the hearing documents. The Respondents cross-appealed the ET’s finding that the Claimant had suffered detrimental treatment, its failure to find that there was an occupational requirement that the actor playing Celie had not manifested a belief such as that expressed in the Claimant’s Facebook post, and its failure to find that keeping the Claimant on the books of the agency would effectively have amounted to compelled speech.

The EAT dismissed the appeals. Although, contrary to the Respondents’ first ground of cross-appeal, it had been open to the ET to find that the Claimant had suffered detrimental treatment, it had not fallen into the error of confusing reason and motive but had permissibly found that, whilst the Claimant’s belief formed part of the context, it was not a reason for either her dismissal by the theatre or the termination of her agency contract. In the circumstances, it was unnecessary to rule on the occupational requirement or compelled speech arguments. As for the harassment claim, the ET had not failed to have regard to the impact on the Claimant of the social medial storm (the “other circumstances” for the purposes of section 26(4)(b) Equality Act 2010), but had found that the Respondents had not caused, or contributed to, that circumstance, and permissibly found that the Claimant’s treatment had not reasonably had the requisite effect.

The ET had also been entitled to reject the Claimant’s argument that any breach of ECHR rights would amount to a “violation of dignity”; that argument was academic, as the ET had not found that any of the Claimant’s ECHR rights had been infringed. The ET had also been correct to dismiss the Claimant’s breach of contract claim against the Second Respondent. She had been offered the full contract fee, so there was no pecuniary loss. Moreover, as the Claimant knew she would not play a lesbian character, but had not raised this with the theatre, or sought to inform herself as to the requirements of the role of Celie, she was in repudiatory breach of her express obligations, and of the implied term of trust and confidence. Although the Second Respondent was not aware of this at the date of termination, no damages (e.g. for loss of publicity/enhanced reputation) could be due.

In making a costs award against the Claimant, the ET had been entitled to reach the conclusion that her claims either had no reasonable prospect of success from the outset, or that they had no reasonable prospect once the Claimant realised that she would never in fact have played the role of Celie, or that the conduct of the claims had been unreasonable; as such it had permissibly found the threshold for a costs award was met. As for the Claimant’s objection to the amount of the award (the entirety of the Respondents’ costs, subject to detailed assessment), the ET: (i) was entitled to find that the change in the Claimant’s case had an effect on the entire proceedings, and (ii) had drawn inferences that were open to it on its findings as to the conduct of the Claimant’s case, such that it had permissibly taken into account the resources of those who had supported the litigation for their own purposes. As for the order restricting the future publication of all hearing documents, that had been a decision open to the ET under its powers of case management. It had had due regard to the open justice principle and been entitled to exercise its discretion in the way that it had.

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Equal Pay: Identification of decision-maker is not essential to material factor defence

In Scottish Water v Edgar [2024] EAT 32, the Claimant brought an equal pay claim under the Equality Act, 2010. Her comparator was a male employee with the same job title and within the same pay band who had been appointed after her. The Appellant raised a ‘material factor defence’ (i.e. the employer is able to give a genuine reason for the difference in pay between the Claimant and their comparator that is not related to gender) that the difference in pay was due to the comparator’s superior skills, experience and potential. The Appellant led evidence about discussions within its organisation about those matters and about the resultant level of salary ultimately offered to the comparator at the time of his appointment. It also sought to lead comparative evidence of the Claimant’s skills, experience and potential both at the time of and after his appointment.

The Employment Tribunal (ET) directed itself that the Appellant required to prove the identity of the pay decision-maker at the point in time when the comparator was engaged. It concluded that the Appellant had not done so, and that the material factor defence accordingly failed. It also directed itself that comparative evidence of the respective skills, experience and potential of the Claimant and the comparator in a period of time after the comparator’s appointment was irrelevant.

The EAT held that:

an employer does not need to prove the identity of the decision-maker in order to establish a material factor defence to an equal pay claim, and
comparative evidence of the respective skills and abilities of the claimant and the comparator from a period in time after the comparator’s appointment is not necessarily irrelevant to the employer’s defence, according to the EAT.

The ET’s judgment was set aside and the preliminary issue was remitted to a differently constituted tribunal. It was observed that the primary purpose of the reasons section of any decision of an ET should be to explain to the parties clearly and concisely why the tribunal reached its decision.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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The data contained within this document is for general information only. No responsibility can be accepted for inaccuracies. Readers are also advised that the law and practice may change from time to time. This document is provided for information purposes only and does not constitute accounting, legal or tax advice. Professional advice should be obtained before taking or refraining from any action as a result of the contents of this document.

News & Views

Employment Law General Update – March 2024

Employment,
24th March 2024

Employment Law

We bring news of several changes to the leave allowances for parents and carers in this month’s update. We also look at the latest report from the Treasury about the shocking levels of sexual harassment and bullying in the city whilst the Parker Review has found while there has been some improvement in ethnic minority representation on boards, there is still plenty of room for improvement. We also share news on the new ICO guidance on information sharing in a mental health emergency at work.

Parental & Carer’s Leave: New Regulations come into force

Discrimination: Sexism in the City report finds ‘shocking’ levels of sexual harassment and bullying

Diversity and Gender Pay Gap: Parker Review Committee update report expands scope of targets for ethnic minority representation

Data Protection: ICO issues guidance on information sharing in a mental health emergency at work

Parental & Carer’s Leave: New Regulations come into force

The new Paternity Leave (Amendment) Regulations 2024 (SI 2024/329) are made to amend the Paternity and Adoption Leave Regulations 2002, SI 2002/2788, the Paternity and Adoption Leave (Adoption from Overseas) Regulations 2003, SI 2003/921, and the Paternity, Adoption and Shared Parental Leave (Parental Order Cases) Regulations 2014, SI 2014/3096. They came into force on 8 March 2024 and apply to children whose:

expected week of childbirth is after 6 April 2024; or
expected date of placement for adoption, or expected date of entry into Great Britain for adoption, is on or after 6 April 2024.

The changes include, amongst other things:

allowing an employee to choose to take either two non-consecutive weeks’ paternity leave (birth), or a single period of either one week or two weeks; and
extending the period in which paternity leave (birth) must be taken from 56 days after the birth of the child, to 52 weeks after the birth.

The new Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024 (SI 2024/264) are made to extend an existing statutory protection from redundancy that currently applies to those employees who are on maternity, adoption or shared parental leave. The extension means this protection also applies to pregnant women and new parents who have recently returned from any period of maternity or adoption leave, or from a period of six or more weeks of shared parental leave. The Regulations are due to come into force on 6 April 2024. Therefore any employers currently considering commencing a redundancy process or in the middle of one should review any affected employees who may now be protected under these new Regulations.

The Carer’s Leave Regulations 2024 (SI 2024/251) are made to implement a new statutory entitlement to Carer’s Leave for employees from 6 April 2024. They ensure that this leave will be available to employees for the purpose of caring for a dependant with a long-term care need. They are also due to come into force on 6 April 2024.

These are supported by The Carer’s Leave (Consequential Amendments to Subordinate Legislation) Regulations 2024 (SI 2024/266) which make necessary amendments to various pieces of secondary legislation in consequence of the Carer’s Leave Act 2023 which makes provision for the new statutory right to carer’s leave, available for employed carers from 6 April 2024. When calculating entitlements to certain other benefits or rights, leave is often a relevant factor. This instrument makes provision to ensure that it is clear in those pieces of secondary legislation how carer’s leave should be treated in those calculations.

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Discrimination: Sexism in the City report finds ‘shocking’ levels of sexual harassment and bullying

The Treasury Committee has published its Sexism in the City report, following an inquiry launched in July 2023, and is calling for an end to the ‘era of impunity’ after finding a ‘shocking’ prevalence of sexual harassment and bullying, and a culture which is ‘holding back women’ in the City. The Committee welcomes proposals by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) to strengthen their regimes for tackling non-financial misconduct, including sexual harassment, but calls on them to ‘drop their prescriptive plans for extensive data reporting and target setting’. The FCA has responded to the report.

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Diversity and Gender Pay Gap: Parker Review Committee update report expands scope of targets for ethnic minority representation

The Parker Review Committee has published its March 2024 report into ethnic diversity across UK businesses. For the first time, the Committee has expanded its review to include senior management data, commenting that this yields a clearer picture than looking into boards of directors alone. It has also expanded its research to include private companies (50 in total) as well as listed companies. The report found that:

96% of FTSE 100 companies have at least one ethnic minority director on their board, compared with 44% of private companies;
ethnic minorities currently represent an average of 13% of senior management positions within FTSE 100 companies, with a target set to increase this average to 17% by 2027.

Hywel Ball, Chairman and Managing Partner of EY UK, says:

“The Parker Review, and the targets that it sets, provide an important benchmark and objective criteria to encourage fair representation of ethnic minorities. Crucially, it ensures we lead efforts to diversify UK business with respect to ethnicity from the top down and continue to be held accountable, no matter the macroeconomic climate. Representation matters – the more diverse boardroom and executive teams are, the greater the ripples across the organisation. Over the last nine years, there has been good progress but we are still a long way from achieving parity based on ethnicity. This year’s figures – 12 ethnic minority CEOs in the FTSE 100 and 7 Chairs – are encouraging but show there is work to be done to ensure our business leaders fairly represent their customers and society they serve.”

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Data Protection: ICO issues guidance on information sharing in a mental health emergency at work

The Information Commissioner’s Office (ICO) has issued guidance for employers on sharing their workers’ personal information in a mental health emergency. The guidance sets out advice on when, and how, it is appropriate to share workers’ personal information where the employer believes that someone is at risk of causing serious harm to themselves or others due to their mental health. The ICO adds that it is good practice to plan ahead in order to make timely and better-informed decisions during a mental health emergency. The guidance considers what a mental health emergency is, how mental health information differs under data protection law, how to plan for information sharing and the lawful bases and special category conditions that are most likely to apply.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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News & Views

Employment Law Case Update – February 2024

Employment,
26th February 2024

Employment Law

In this issue, we delve into recent legal cases that shed light on critical aspects of employment law looking at the treatment of a gender-critical professor over their research, the intricacies of whistleblowing as it may or may not affect job applicants, an examination of the Transfer of Undertakings (Protection of Employment) regulations (TUPE), and the delicate balance between anonymity and justice in relation to fabricated sexual assault allegations.

Discrimination & Harassment: Gender-critical professor was discriminated against for research
Whistleblowing: Job applicants are not entitled to bring claims when they have suffered detriment because of making a protected disclosure
TUPE: Liability for harassment claim does not transfer if both employees do not transfer
Anonymity: Claimant who made up sexual assault was not entitled to privacy orders

Discrimination & Harassment: Gender-critical professor was discriminated against for research

In Phoenix v The Open University (3322700/2021 & 3323841/2021), a gender-critical professor has persuaded an employment tribunal that her employer university harassed and discriminated against her based on her views before unfairly pushing her to resign.

At the tribunal, the Employment Judge Young ruled that Open University professors led a ‘call to discriminate’ against Professor Jo Phoenix by releasing an open letter protesting against her gender-critical research network. The discriminatory letter led to a ‘pile-on’ against Phoenix, Judge Young said. The judge said that the university failed to provide a suitable working environment for Phoenix by leaving her exposed to the backlash, which amounted to a breach of the implied term of trust and confidence in her contract and ultimately led her to resign. She found that The Open University did not protect Phoenix from the ‘negative campaign’ against her after she launched her research network because it ‘did not want to be seen to give any kind of support to academics with gender critical beliefs’, the judge said.

The university employed Phoenix as a professor from 2016 until she resigned in December 2021 following what she described as an ‘exceptionally painful’ part of her career amid widespread opposition to her views. Equality laws protect Phoenix’s belief (a position often referred to as gender-critical) which holds a person cannot change their biological sex and that sex cannot be conflated with gender identity, according to the 155-page ruling.

Phoenix ran a research network at the university that examined sex, gender and sexuality from a gender-critical perspective, according to the ruling. But the network met significant opposition from her colleagues, the judgment says. Criminology professor Louise Westmarland harassed Phoenix by comparing her views to those of ‘a racist uncle at the Christmas table’, the judge said. ‘Westmarland knew that likening [Phoenix] to a racist was upsetting’, Judge Young said. ‘We conclude that its purpose was to violate [Phoenix’s] dignity because, inherent in the comment, is an insult of being put in the same category as racists.’

Her colleagues also discriminated against her when they ‘gave her the silent treatment’ during a departmental meeting in response to Phoenix securing a grant of CAN$1m grant for research into transgender prisoners. Criminology lecturer Deborah Drake also discriminated against Phoenix by instructing her not to speak to the rest of the department about her research, about Essex University’s decision to cancel her talk on trans rights and imprisonment and about accusations of being a ‘transphobe’ that she was facing, Judge Young said. ‘Others were allowed to speak about their research in subsequent meetings…and research updates were part of the agenda for departmental meetings’, the judge said.

A series of tweets and retweets by Open University staff referring to Phoenix as transphobic also insulted her and discriminated against her, according to the judgment. The university also continued to harass Phoenix after her resignation by publishing further statements on its website condemning her research, Judge Young said.

‘I am delighted that the tribunal found in my favour’, Phoenix said in a statement. ‘Academics and universities must now, surely, recognise their responsibilities toward promoting diversity of viewpoints and tolerance of alternative views.’ Leigh Day partner Annie Powell, who represented Phoenix, added that she hopes to see ‘no further cases of academics being treated so badly because of their protected beliefs’.

Professor Tim Blackman, vice-chancellor of the Open University, said, ‘Our priority has been to protect freedom of speech while respecting legal rights and protections. We are disappointed by the judgment and will need time to consider it in detail, including our right to appeal.’

The Employment Appeal Tribunal overturned in 2021 a ruling by a lower tribunal that gender-critical views are not a protected belief. It held that the opinions held by a woman who lost her job after she published comments about transgender people online were legally protected. Ms Forstater was subsequently awarded over £106,000 by the employment tribunal. The employment tribunal ruled in a different case in May 2023 that the Open University did not discriminate against a member of staff that it sacked for sending a racist tweet to Star Wars actor John Boyega.

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Whistleblowing: Job applicants are not entitled to bring claims when they have suffered detriment because of making a protected disclosure

The EAT in Sullivan v Isle of Wight Council [2024] EAT 3 confirmed the position that whistleblowing detriment claims are confined to workers (as defined) and do not extend to job applicants, except in the case of applicants for jobs with certain specified NHS employers under the Employment Rights Act 1996 (NHS Recruitment—Protected Disclosure) Regulations 2018. It confirms that using a Gilham style argument, applying the right to freedom from discrimination under Article 14, read with the right to freedom of expression under Article 10, of the European Convention on Human Rights, to extend the reach of such claims to job applicants, will not succeed, in particular because being a job applicant is not some ‘other status’ for the purpose of Article 14.

All workers have the right to bring a claim in relation to any detriment suffered because of any act or omission by their employer, done on the ground that the complainant made a protected disclosure. ‘Worker’ in this context has an extended definition. The protection applies to workers (as defined). Job applicants are generally not covered. However, certain NHS employers are prohibited from discriminating against job applicants because it appears that they have made a protected disclosure.

In Gilham, a whistleblowing detriment claim under Employment Rights Act 1996 (‘the Act’), the Supreme Court held that the claimant, a district judge, was not a worker for the purposes of the Act (because she had no contract) but held that judicial-office-holders were nonetheless entitled to bring claims for whistleblowing protection under the Act because the exclusion of judges was in breach of their right to freedom from discrimination under Article 14, read with the right to freedom of expression under Article 10, of the European Convention on Human Rights (ECHR). The Supreme Court concluded that the Act should therefore be read and given effect so as to extend their whistleblowing protection to the holders of judicial office.

The claimant in this case had two unsuccessful applications for financial officer roles with the respondent. She then lodged complaints alleging that multiple inappropriate/discriminatory comments had been made during her interviews including that she had been called ‘mentally insane’. Her complaints were rejected and she was refused an appeal. Later she lodged claims for discrimination, victimisation and whistleblowing detriment. The detriment claim related to the refusal to allow her an appeal which she said was because of an allegation of financial mismanagement that she had made against one of the interviewers in relation to a charity with which he was involved. She alleged that even though the whistleblowing provisions only applied to workers (which she was not) they should be extended to job applicants, such as her, using Articles 10 and 14 of the ECHR.

The employment tribunal dismissed the whistleblowing detriment claim and the claimant appealed. The EAT upheld part of the tribunal’s decisions but also dismissed the appeal on the basis that:

Whilst the facts fell within the ambit of the right to freedom of expression protected by Article 10 ECHR, it was only applicable subject to the following conditions.
An external job applicant is not in a situation analogous to that of the internal applicant, who is already embedded in the workplace and whose disclosure is made in that context. It was also accepted that this particular claimant’s situation was not analogous to that of an internal applicant. Her application process had come to an end some months previously. Her subsequent disclosure had related to matters unconnected with the application made, or, indeed, with the respondent itself, and had been advanced under a complaints policy of which any member of the public was able to avail themself in relation to any perceived wrongdoing by the respondent. The NHS Regulations were not applicable here.
The claimant had relied on the status of an external job applicant as the ‘other status’ for the purposes of Article 14 ECHR. However, that was found not to be of the same quality as the occupational classification (judicial officeholder) as in the precedent case. The claimant did not possess or acquire a status, or occupational classification, independent of her act of applying for a job.
Whilst the EAT found the employment tribunal’s approach to the question of proportionality was problematic, in the absence of any evidence going to that matter and the structured approach to answering that question required by the precedent case, it was not relevant here due to the above three issues. Had the answers to the those questions been otherwise, the matter would have been remitted for fresh consideration of that particular question.

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TUPE: Liability for harassment claim does not transfer if both employees do not transfer

In Sean Pong Tyres Ltd v Moore [2024] EAT 1 the EAT found that the transferor employer’s primary liability to its employee for the harassment did not transfer to the transferee employer under TUPE where the employee’s employment did not transfer to the new employer for reasons that were not connected with it (e.g. as in this case where the employee’s employment came to an end before the transfer for unrelated reasons).

In this case, the claimant resigned in April 2021 and claimed unfair constructive dismissal and harassment based on the actions of a fellow employee, Mr Owusu. In July 2021, after the claimant had left, there was a TUPE transfer of the respondent business, including Mr Owusu, to Credential. Neither Mr Owusu nor Credential were made respondents to the claim. The claim was only brought against the respondent by whom the claimant had been employed. When the hearing began the respondent’s representative applied to amend the response to argue that the respondent was not liable for the harassment, on the basis that liability for that had transferred to Credential under TUPE 2006.

The employment tribunal dismissed the respondent’s amendment application on the basis that the effect of TUPE 2006 was not to transfer liability for harassment to Credential in respect of the claimant who they had never employed and that, following the Selkent principles, on the facts, the balance of prejudice was in favour of the claimant.

The employment tribunal then upheld the claims of unfair constructive dismissal and harassment. The respondent appealed to the EAT who dismissed the appeal, finding that the transferor employer’s primary liability to its employee for the harassment does not transfer to the transferee employer if the employee’s employment does not transfer for reasons that were not connected with it (e.g. as in this case where the employee’s employment came to an end before the transfer for unrelated reasons).

This should come as a relief to transferees who might otherwise have found themselves liable for Equality Act 2010 claims by individuals who they had never employed (although it is likely that such liability could have been dealt with by suitable warranties/indemnities in a transfer agreement).

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Anonymity: Claimant who made up sexual assault was not entitled to privacy orders

In Z v Commerzbank and others [2024] EAT 11, a claimant who was found by an employment tribunal to have made up a sexual assault allegation, and who had made no such allegation to the police (or other appropriate person), was not entitled to continued protection under anonymity and restricted reporting orders that an employment judge had made. For a claimant to have the protection of section 1(1) of the Sexual Offences (Amendment) Act 1992 (SO(A)A 1992) there must be a formal allegation made in the context of potential criminal proceedings, where a criminal charge may be brought (such as a complaint to the police, a prosecuting authority, a safeguarding body, a social worker or social services department or other person with professional responsibility for taking the complaint further through the criminal justice system). In addition, the tribunal’s decision, that the claimant’s account given in his evidence was in large part false and, in particular, that his complaints of sexual harassment and sexual assault were fabricated, was a material change of circumstances entitling the tribunal to revoke the anonymity and restricted reporting orders. Also, the tribunal’s balancing exercise in relation to Convention rights was not flawed, according to the Employment Appeal Tribunal.

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Further Information:

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Employment Law General Update – February 2024

Employment,
26th February 2024

Employment Law

Welcome to our February employment law updates covering issues such as: the EHRC’s guidance on menopause in the workplace under the Equality Act, the National Minimum Wage sees latest amendments, over 500 companies are named and shamed for wage non-compliance. Discussions around ‘fire and rehire’ practices intensify, and updates on Skilled Worker and Family Immigration are announced, including changes limiting careworkers’ dependents and ending the Ukraine Family Scheme. Stay informed as we navigate these key developments.

Equality Act: EHRC issues menopause in the workplace guidance for employers
Pay: National Minimum Wage (Amendment) (No 2) Regulations 2024
Pay: 500+ companies named and shamed for not paying National Minimum Wage
Fire and Rehire: DBT publishes response to consultation on code of practice on dismissal and re-engagement
Immigration: Dates announced on Skilled Worker and Family Immigration
Immigration: Statement of Changes HC 556 stops careworkers from bringing dependants and ends Ukraine Family Scheme

Equality Act: EHRC issues menopause in the workplace guidance for employers

The Equality and Human Rights Commission (EHRC) has issued new guidance on menopause in the workplace, setting out employer’s legal obligations under the Equality Act 2010. The new guidance aims to clarify these obligations and provide practical tips for employers on making reasonable adjustments and fostering positive conversations about the menopause. If menopause symptoms have a long term and substantial impact on a woman’s ability to carry out normal day-to-day activities, they may be considered a disability. Under the Equality Act 2010, an employer will be under a legal obligation to make reasonable adjustments and to not discriminate against the worker. Additionally, workers experiencing menopause symptoms may be protected from less favourable treatment related to their symptoms on the grounds of age and sex.

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Pay: National Minimum Wage (Amendment) (No 2) Regulations 2024

The draft National Minimum Wage (Amendment) (No 2) Regulations 2024, which are due to come into force on 1 April 2024:

abolish the rate of the national minimum wage for workers who are aged 21 or over (but are not yet aged 23 years) so that workers aged 21 or over will now qualify for the national living wage, rather than a lower national minimum wage rate;
increase the rate of the national living wage for workers who are aged 21 or over from £10.42 to £11.44 per hour;
increase the rate of the national minimum wage for workers who are aged 18 or over (but not yet aged 21) from £7.49 to £8.60 per hour;
increase the rate of the national minimum wage for workers who are under the age of 18 from £5.28 to £6.40 per hour;
increase the apprenticeship rate for workers within SI 2015/621, reg 5(1)(a), (b), from £5.28 to £6.40 per hour;
increase the accommodation offset amount which is applicable where any employer provides a worker with living accommodation from £9.10 to £9.99 for each day that accommodation is provided.

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Pay: 500+ companies named and shamed for not paying National Minimum Wage

The Department for Business and Trade (DBT) has named more than 500 companies for not paying national minimum wage to over 172,000 employees. Defaulting employers have been ordered to repay these workers almost £16m to backfill these breaches. This is the 20th list to be published by the government since the introduction of the naming scheme in 2013 under which it publicly ‘names and shames’ employers who fail to pay the minimum wage. The ‘naming and shaming’ scheme was paused from July 2018 until it recommenced in February 2020 in a revised form.

Employers named include major high street brands, including Estee Lauder, Easyjet, Greggs, Wickes and River Island. One employer, Staffline Recruitment Ltd, failed to pay £5,125,270.93 to 36,767 workers.

The businesses named have since paid back what they owe to their staff and have also faced financial penalties of up to 200% of their underpayment. The investigations by His Majesty’s Revenue and Customs (HMRC) concluded between 2015 and 2023.

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Fire and Rehire: DBT publishes response to consultation on code of practice on dismissal and re-engagement

The Department for Business and Trade has published a response to the consultation on a draft statutory code of practice on dismissal and re-engagement. The consultation lasted from 24 January 2023 to 18 April 2023 and considered the action to be taken by employers when considering whether to dismiss and re-engage employees. As a result of the consultation, the government has made a number of changes to the draft code.

Changes to the code include:

a change to the sequencing of the code to ensure the sections on information sharing and consultation appear earlier;
the separate lists of information for employers to share located at paragraphs 25 and 33 have been combined;
the requirement for employers to conduct a full re-assessment of plans after information sharing and consultation;
changing the obligation to phase in changes to ‘best practice’;
a reduction in the length of the code and amendments to make it clearer and less technical;
a greater requirement on employers contacting ACAS prior to dismissal and re-engagement.

The full response can be found here.

The explanatory memorandum can be found here.

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Immigration: Dates announced on Skilled Worker and Family Immigration

The Minister of State for Legal Migration and the Border, Tom Pursglove MP, has made a Statement to the House of Commons giving more details of the timeline for various aspects of the five-point legal migration plan relating to the Skilled Worker and family migration routes. In terms of new announcements, he confirmed that there will be two sets of Statements of Changes in Immigration Rules, issued on 19 February 2024 and 14 March 2024, and the dates that the changes will come into force for these purposes.

The 19th February 2024 Immigration Rules will come into force on 11 March 2024 and will:

remove the right for care workers and senior care workers to bring dependants

ensure that care providers in England will only be able to sponsor migrant workers if they are undertaking activities regulated by the Care Quality Commission (CQC)

The 14 March 2024 Immigration Rules will:

raise the Skilled Worker general salary threshold from £26,000 to £38,000 (with some exceptions) from 4 April 2024, and remove the 20% going rate discount for occupations on the Shortage Occupation List (being renamed the Immigration Salary List), as well as temporarily add any occupations as recommended by the Migration Advisory Committee to the new Immigration Salary List
raise the minimum income threshold from 11 April 2024 from £18,600 to £29,000 (in due course it will be raised to £34,300 and then £38,700).

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Immigration: Statement of Changes HC 556 stops careworkers from bringing dependants and ends Ukraine Family Scheme

The Home Office has issued a new Statement of Changes in Immigration Rules HC 556, along with an Explanatory Memorandum (EM). The Statement makes anticipated changes as regards the dependants of careworkers and senior careworkers in the Skilled Worker/Health and Care visa route, and also makes a number of surprise and immediate changes to the Ukraine Schemes, including ending the Ukraine Family Scheme from 3pm on the 19^th February 2024.

Skilled Worker/Health and care visa route

The Statement implements the first part of the Home Secretary’s ‘Five-point plan for Legal Migration’, which seeks to reduce net migration, and removes the possibility for dependent partners and children to apply in the Skilled Worker/Health and Care visa route where the main applicant is applying in, or has leave in either Standard Occupational Code (SOC) codes 6145 (Care worker) or 6148 (Senior care worker). The change will not apply for dependants where the main applicant already has leave in Skilled Worker in either SOC code, or applied for entry clearance or leave in the route on or before 11 March 2024 (and also will not apply where such a main applicant subsequently applies to extend or change employer in either SOC code, or applies for settlement). It will also not apply for children born in the UK.

In addition, sponsors of persons initially applying in either SOC code on or after 11 March 2024 will be required to have Care Quality Commission (CQC) registration and to be currently carrying out a regulated activity. Similar transitional provisions apply as above for further applications by persons who were granted leave under the Rules on or before 10 March 2024 as regards working for a sponsor which does not meet the new requirements.

These changes are effected via amendments to Appendix Skilled Worker, Appendix Skilled Occupations and Appendix Shortage Occupation List of the Immigration Rules. They come into force for applications submitted on and after 11 March 2024. The EM states that the changes are being made ‘in response to high levels of non-compliance and worker exploitation and abuse, as well as unsustainable levels of demand’. It goes on to say that ‘in the year ending September 2023, 83,072 visas were granted for care workers and a further 18,244 visas for senior care workers, comprising 30% of all work visas granted. In addition, there were 250,297 visas granted for work-related dependants, 69% of which were for Health and Care Worker dependants.’

Ukraine Schemes

Closure of the Ukraine Family Scheme

The Statement announces the closure of the Ukraine Family Scheme from 3pm on 19 February 2024. The Ukraine Family Scheme allowed British nationals and those with a qualifying immigration status to sponsor family members. This included immediate and extended family members, as well as the immediate family members of extended family members (e.g. a British national could sponsor a cousin and their children).

Going forwards many people who could have applied under the Ukraine Family Scheme will have to apply under the Homes for Ukraine Sponsorship Scheme instead. This requires an offer of six months accommodation, assessed as suitable by the local authority.

Persons impacted by this change may need advice on alternative immigration options, such as making a human rights claim to join family in the UK.

Reduction in period of leave to 18 months

Ukraine Scheme visa-holders have been receiving three years leave. From 3pm on 19 February 2024 a positive grant of leave will only result in 18 months leave to remain, rather than three years leave. This affects persons who applied before the change in the law and have not yet received a decision on their case.

A limited exception is for unaccompanied minors, who will still receive three years leave, so long as they made their initial hosting application before 3pm on 19 February 2024, even if the local authority check takes place later. Unaccompanied minors who apply after that date will still only receive 18 months leave.

Extension scheme to close on 16 May 2024 except for some children born in the UK

The Ukraine Extension Scheme allows Ukrainians with a time-limited visa in the UK to switch into the Ukraine Scheme, recognising that Ukrainians cannot be expected to return to Ukraine. The deadline to apply has been changed, but it appears that there are currently no plans to increase the 16 May 2024 deadline for the Scheme. This will mean that Ukrainians on other visas, including visit, student, seasonal worker and family visas, will no longer be able to switch into the Ukraine Extension Scheme from that date.

The Statement creates an exception to the closure of the Ukraine Extension Scheme for children born in the UK to a parent who has leave under the Ukraine Scheme. This will come into force on 11 March 2024. The children will receive leave in line with their parent (or if both parents are here, in line with whichever parent’s leave expires last). Such children have been using this scheme informally already, but it is helpful to see a provision in the Rules. Unfortunately, the new provision is silent on what children born outside the UK to a parent with a Ukraine Scheme visa should do.

Additional grounds for refusal

Part 9 of the Immigration Rules sets out general grounds for refusal of immigration applications on character grounds. Only some of those criteria have so far applies to Ukraine Scheme applications and mainly those focused on criminality. The Statement provides that from 3pm on 19 February 2024 additional grounds for refusal will apply, including previous breaches of immigration laws, failures to provide information when required and other general grounds for refusing entry clearance or cancelling permission on arrival. Anecdotally, there have been some cases of arrivals from Ukraine who do not have the right documentation and so this may be a response to that. This does however indicate a tightening up of visa controls for Ukrainians.

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Employment Law Case Update – January 2024

Anne-Marie Pavitt,
26th January 2024

Employment Law

We welcome you back into the land of employment law cases with a few of cases from the back end of 2023. Learn how the ACAS Code plays a crucial role in handling whistleblowing cases, and its implications for compensation uplifts and the limitations of contractual terms. We take a look at how future discrimination claims can be waived when done correctly in a settlement agreement, and evaluate how timings should be considered when looking at constructive dismissal cases, particularly where the claimant has a long employment history and there have been efforts at negotiation.

Whistleblowing: Using the ACAS Code for grievances and compensation uplifts, and whether contractual terms can limit losses
Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised
Constructive Dismissal: Was resignation too slow to have been ‘the last straw’?

Whistleblowing: Using the ACAS Code for grievances and compensation uplifts, and whether contractual terms can limit losses

In SPI Spirits (UK) Ltd & Anor v Zabelin [2023] EAT 147, the claimant was the Group Chief Investment Officer for the first respondent company (SPI Spirits). He agreed a 30% pay cut from April to June 2020 because of the effects of the coronavirus (COVID-19) pandemic on the business. When the first respondent said that the pay cut was being extended to at least 1 September 2020 the claimant raised, in an email of 4 June 2020 and at a meeting on 5 June 2020, various issues including alleging that the pandemic was being used as an excuse to cut pay and that employees were being intimidated. On 8 June 2020 the claimant had a telephone discussion with the second respondent (Shefler), the majority shareholder in the group, who suggested that the claimant should resign if he didn’t agree to proposed changes to bonuses. When the claimant queried why he should resign the second respondent dismissed him. The claimant brought claims including of automatic unfair dismissal and detriment on the grounds of having made whistleblowing protected disclosures (including regarding (a) the claimant’s pay; (b) the claimant’s 2020 bonus; (c) staff welfare; and (d) coronavirus pretence).

The outcome of the case was that the EAT confirmed that a grievance must be in writing for the ACAS Code on Disciplinary and Grievance Procedures to apply but, once that has occurred, if new grievances arise they do not each have to be put in writing for the Code to be engaged, unless there is a ‘material change’ in the nature or scope of the complaint or redress sought such that fairness requires it. In addition, the uplift to compensation for an employer’s failure to follow the ACAS Code also applies to awards made against individuals if the relevant individual was responsible for the failure. Finally, contractual terms limiting loss will not be upheld if they produce an outcome which would have the same effect as disapplying or limiting a statutory provision, according to the EAT.

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Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised

In Bathgate v Technip Singapore PTE [2023] CSIH 48 the Inner House of the Court of Session held that the various protections for the employee built into section 147 of the Equality Act 2010 do not exclude the settlement of future claims so long as the types of claim are clearly identified and the objective meaning of the words used encompassed settlement of the relevant claim. Section 147 of the Equality Act 2010 allows claims for discrimination to be settled using a settlement agreement provided that the settlement agreement relates to the ‘particular complaint’. Accordingly, a settlement agreement can relate to a future complaint if there is sufficient description of it in the claims waived.

There has been significant uncertainty for some time about whether or not future claims an employee might acquire against their employer but which have not yet arisen could, with the correct wording, be effectively waived as part of a settlement agreement. This decision by the Inner House of the Court of Session (the Scottish equivalent to the Court of Appeal) comes unequivocally to the conclusion that future claims can be waived in a settlement agreement so long as they are sufficiently identified in accordance with the requirements in Hinton v University of East London [2005] EWA Civ 532.

Whilst employers would be wise to consider including future claims in settlement agreements, those representing individuals may try to exclude future claims. However, it should be noted that the decision in this case may not necessarily be followed in England. While decisions from the Inner House of the Court of Session are often considered by employment tribunals and the Employment Appeal Tribunal (EAT) in England, they are not strictly binding, so caution should be exercised.

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Constructive Dismissal: Was resignation too slow to have been ‘the last straw’?

In Leaney v Loughborough University [2023] EAT 155, the claimant had been a university lecturer and warden of a halls of residence with over 40 years’ service at the University. A student had made a complaint against him in 2018, which he disputed and had led to disciplinary action and in turn a grievance being raised by the claimant. He subsequently resigned as warden in December 2019, and asked several times for a grievance appeal to be held. They told him several times to draw a line under the matter but the claimant persisted. On 29 June 2020, he was told that the university could not look at the issue any further. There followed a period of negotiation between solicitors but due to be back at work that autumn, the claimant was so anxious he was signed off sick by his GP on 10 September 2020, and then resigned with notice on 28 September 2020, thereafter claiming constructive unfair dismissal, alleging a cumulative breach of the implied duty of trust and confidence.

The claimant claimed the notification he had received on 29 June 2020 was the ‘last straw’. The tribunal held that he had affirmed the contract of employment during the three months between 29 June, and his resignation on 28 September 2020 because he should have tendered his resignation prior to this.

The EAT disagreed with the tribunal’s approach and remitted the issue of affirmation for reconsideration, holding:

that the tribunal’s focus should not necessarily be on how much time has passed when considering whether affirmation has taken place, but should take into account all the surrounding facts and circumstances should be weighed.
where there has been a period of delay then length of service should be taken into account in deciding whether the contract has been affirmed but it is fact sensitive. It is understandable that an employee with long service may take longer to consider their position (without necessarily having affirmed) before removing themselves from a secure job, but the surrounding context is vital and should be applied on an case-by-case basis.
a period of negotiation before resignation is relevant. Negotiations could be an employee’s attempt to give the employer the opportunity to ‘put things right’ before resigning and therefore such a delay may not necessarily amount to affirmation of the contract.

His claim was dismissed on the basis that, between the date of the last matter that could potentially be relied upon as a last straw, and the date of resignation, he had affirmed the contract. Having regard to the facts found, and the matters relied upon by the claimant as relevant to the question of whether there had been affirmation, the tribunal erred in its approach to affirmation. The EAT found the tribunal had focused incorrectly on things that did not happen (the Claimant did not delay his resignation because of student exams and did not state that he was working under protest), which, if they had happened, might have pointed away from affirmation. Instead, they should have honed in on what conduct there had been which might have amounted to affirmation. The EAT therefore remitted the matter to the same tribunal for fresh consideration of that issue, in light of the facts found, and, as necessary, the further issues to which the complaint gave rise.

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Employment Law General Update – January 2024

Anne-Marie Pavitt,
26th January 2024

Employment Law

Welcome back to another year of invaluable insights and updates in the dynamic world of employment law. This month, discover the upcoming changes and trends that will shape employment law in the early months of 2024, stay compliant with the most recent holiday pay regulations by accessing the latest government guidance, and learn about ACAS’s updated Code of Practice for handling flexible work requests and adapt to the evolving landscape.

As ever, stay informed and up-to-date with Dixcart Legal.

What’s in store for Employment law in early 2024?
Holiday Pay: Government publishes new guidance
Flexible Working: ACAS publishes a revised Code of Practice on requests for flexible working

What’s in store for Employment law in early 2024?

There are four pieces of legislation that came into effect on 1 January 2024.

First, the Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 amends the Working Time Regulations in relation to paid holiday for irregular hours workers and part-year workers from 1 April 2024, plus in relation to the calculation of normal pay, the carrying forward of paid holiday and record-keeping requirements. These regulations also expand the information and consultation obligations on small businesses under TUPE for transfers on or after the 1 July 2024.

The second piece of legislation was the Equality Act 2010 (Amendment) Regulations 2023. They make various changes to the Equality Act 2010 to reproduce certain interpretive effects of retained EU law which would otherwise cease to apply in the UK after the end of 2023. They include amending the definition of disability to take into account a person’s ability to participate in working life on an equal basis with others, providing an express right to claim indirect discrimination by association and preserving the single source test for equal pay comparisons.

The third and fourth pieces of legislation are the Retained EU Law (Revocation and Reform) Act 2023 (Commencement No. 1) Regulations 2023 and the Retained EU Law (Revocation and Reform) Act 2023 (Consequential Amendment) Regulations 2023. They make fundamental changes including abolishing the principle of supremacy of, and general principles of, EU law, as well as replacing references to ‘retained EU law’ with the term ‘assimilated law’ in UK legislation (including the Equality Act 2010).

A significant change which came into force on 6 January 2024 (under section 1 of the National Insurance Contributions (Reduction in Rates) Act 2023) was the reduction from 12% to 10% in the employee primary Class 1 National Insurance Contributions rate, as announced in the government’s recent Autumn Statement.

From 22 January 2024 the maximum civil penalty for the illegal employment of an adult who is subject to immigration control will triple, from £20,000 to £60,000 for each offence pursuant to the Immigration (Employment of Adults Subject to Immigration Control) (Maximum Penalty) (Amendment) Order 2023.

Looking forward to April 2024, there will be two sets of regulations affecting the national minimum wage coming into force on 1 April 2024. The first, the National Minimum Wage (Amendment) Regulations 2024, will increase the minimum rates for workers, including the new rate of the national living wage of £11.44 an hour for the first time to all those aged 21 and over. The second set of regulations, the National Minimum Wage (Amendment) (No. 2) Regulations 2023, will remove the exemption for live-in domestic workers so that nannies and au pairs will have to be paid the national minimum wage.

Then, on 6 April 2024, the right to request flexible working will become a day one right (under the Flexible Working (Amendment) Regulations 2023) and the rate for Statutory Sick Pay will increase to £116.75 per week (under the Social Security Benefits Up-rating Order 2024). In addition, on that date, two family-friendly pieces of legislation will come into force:

the Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024 will extend existing protections if an employee is on maternity, adoption or shared parental leave when a redundancy arises, so that those protections also apply during pregnancy, and for a period of time after the relevant leave has ended; and
the Carer’s Leave Regulations 2023 will allow employees to take up to one week of unpaid leave per year to provide, or arrange, care for a dependant with a long-term care need.

Also in April 2024, the rate of Statutory Maternity Pay (and other family related statutory payments) will increase to £184.03 per week (also under the Social Security Benefits Up-rating Order 2024).

Finally in this round-up, on 9 May 2024, two sets of regulations relating to trade unions will come into force (the Trade Union Act 2016 (Commencement No. 6) Regulations 2023 and the Trade Union (Deduction of Union Subscriptions from Wages in the Public Sector) Regulations 2023). These will have the combined effect of restricting when relevant public sector employers can make deductions from their workers’ wages in respect of trade union subscriptions.

As if that was not enough, other legislation to look out for that is not Employment law-related but relevant for all companies is the Economic Crime and Corporate Transparency Act 2023 in relation to the failure to prevent fraud. Companies House has published a blog post on 22 January 2024 detailing the initial changes which will apply from 4 March 2024: Get ready for changes to UK company law – Companies House (blog.gov.uk)

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Holiday Pay: Government publishes new guidance on pay and entitlement

The government has published new guidance on the holiday pay and entitlement reforms from 1 January 2024. The guidance covers the meaning of an irregular hours worker and a part-year worker, holiday entitlement for these workers, carry-over of leave and holiday pay calculations.

The government has now published guidance to accompany the changes made to the Working Time Regulations 1998, SI 1998/1833, by the Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023, SI 2023/1426, with effect from 1 January 2024.

The guidance is arguably of more limited impact than anticipated because:

it expressly states that:

‘It does not provide definitive answers to all individual queries. It is not intended to be relied upon in any specific context or as a substitute for seeking advice (legal or otherwise) on a specific circumstance, as each case may be different.’

in relation to some grey areas, the guidance just restates the legislation and does not provide any examples of what factually would meet the requirements set out (e.g. in relation to what an employer must do to give a worker a reasonable opportunity to take their leave and encourage them to do so);
it does not expressly address the issue of whether or not annual bonuses should be included in holiday pay calculations.

The guidance does, however, include illustrative examples of who would, and would not, fall within the definitions of an irregular hours worker and a part-year worker. In relation to the latter category, the guidance states that a worker with an annualised (flat) salary over 12 months would not qualify as a part-year worker even though there are periods of one week or more when they are not working as there are no weeks in which they are not receiving pay.

What does the guidance cover?

The guidance covers:

the definitions of an irregular hour worker and a part-year worker
holiday entitlement for these workers
carry-over of leave, and
holiday pay calculations.

Some particular points worth highlighting are set out below.

Irregular hours and part-year workers

The guidance gives examples as to who would fall within or outside these definitions.

The examples demonstrate that a truly zero hours (casual) worker would count as an irregular hours worker whereas a worker on a rotating (but fixed) two-week shift pattern, for which the number of hours alternates, would not.

The guidance explains that part-year workers with fixed hours, for example, teaching assistants who only work during term-time, and who are paid only when working, would count as part-year workers. However, workers with an annualised (flat) salary over 12 months (e.g. most teachers) would not count as a part-year worker as there are no weeks where such a worker is not receiving pay.

Holiday pay rates and order of leave

The guidance explains that in respect of full-year workers who are legally entitled to 5.6 weeks of paid statutory holiday entitlement per year:

the first four weeks of this entitlement must be paid at a worker’s ‘normal’ rate of pay
the remaining 1.6 weeks’ entitlement can be paid at ‘basic’ rate of pay.

The guidance notes that:

‘The regulations do not state which entitlement should be used first. Many employers choose not to distinguish between the 2 pots of leave, and to pay the entire 5.6 weeks at the ‘normal’ rate of pay. If an employer wishes to pay different holiday rates for different periods of leave, then they should consider explaining this clearly and consistently to the worker, for example in the worker’s contract or staff handbook.’

Annual bonuses

The guidance does not expressly deal with the question of whether annual bonuses should be included when calculating holiday pay. However, the principles set out in the guidance may assist in how this issue is to be determined. For example, the guidance states that:

‘Holiday pay is based on the legal principle that a worker should not suffer financially for taking holiday. The amount of pay that a worker receives for the holiday they take depends on the number of hours they work and how they are paid for those hours. Pay received by a worker while they are on holiday should reflect what they would have earned if they had been at work and working.’

This would support the exclusion of an annual bonus when calculating holiday pay in circumstances where the annual bonus (and its amount) is paid irrespective of the number of weeks of annual leave taken, as to do otherwise would result in the worker being paid more for the period of holiday than their normal pay.

The position is not so straightforward, however, where bonuses are linked to performance which is related to time worked, as in that scenario a worker taking their full entitlement to annual leave may get a reduced bonus compared to a worker who took no annual leave.

It may be that employers will choose to make it clear in their bonus policies or schemes that workers are encouraged to use their full entitlement to annual leave and will not be penalised in terms of bonus for doing so, in an effort to clearly put themselves into the former rather than the latter category, and exclude annual bonuses from holiday pay calculations.

Starting to use rolled-up holiday pay

For irregular hours and part-year workers, for holiday years starting on or after 1 April 2024, employers can choose to use rolled-up holiday pay.

In terms of practicalities, the guidance states that:

‘If employers intend to start using rolled-up holiday pay, they should check their workers’ contract in case this amounts to a variation of contract. Employers should tell their workers if they intend to start using rolled-up holiday pay and for this payment to be clearly marked as a separate item on each payslip. The holiday pay should be paid at the same time as the worker is paid for the work done in each pay period. Employers of agency workers must include this information in the agency worker’s Key Information Document.’

The guidance also notes that if the employer chooses to use rolled-up holiday pay then the entire amount of leave for irregular hours and part-year workers will be paid at the ‘normal’ rate of pay.

The Government guidance can be found here: Holiday pay and entitlement reforms from 1 January 2024

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Flexible Working: ACAS publishes a revised Code of Practice on requests for flexible working

The Advisory, Conciliation and Arbitration Service (ACAS) has published its revised Code of Practice on requests for flexible working. The revised Code of Practice will come into effect in April 2024. Until then the current Code of Practice will continue to apply. The Draft Code of Practice was originally published as part of an ACAS consultation in July 2023. The consultation closed on 6 September 2023.

Following the consultation, ACAS has made a number of changes to what is now the revised Code of Practice. These are:

providing that guidance on consulting with an employee about a flexible working request recommends that where the original request cannot be fully met, employers discuss with the employee any potential modifications
ensuring that formal meetings following the acceptance of a flexible working request are no longer required
providing an extended list of categories of companions allowed to accompany an employee to a request meeting. However, the Code of Practice makes clear that there is not statutory right of accompaniment
recommending that all organisations (not just larger ones) ensure a different manager deals with an appeal over a flexible working request.

All other areas proposed in the initial draft Code of Practice will remain.

The ACAS consultation can be found here.

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Employment Law Case Update – December 2023

Employment,
15th December 2023

Employment Law

As the year draws to a close we delve into some technical cases – an update on the case that just keeps on giving (Deliveroo), a look at how “heat of the moment” resignations play out and when they might be considered to have in fact been an unfair or wrongful dismissal, and how a tribunal got it wrong in not calling out a respondent’s alleged dishonesty.

Worker Status: Supreme Court unanimously agrees that Deliveroo riders were not in an employment relationship
Termination: No ‘special circumstances exception’ when assessing resignation or dismissal
Tribunals: Tribunal’s failure to allege dishonesty amounted to a serious procedural irregularity

Worker Status: Supreme Court unanimously agrees that Deliveroo riders were not in an employment relationship

On 21 November 2023, the Supreme Court handed down its judgment in Independent Workers Union of Great Britain v Central Arbitration Committee [2023] UKSC 43. The issues at stake were, did the Central Arbitration Committee’s refusal to accept the Union’s application to be recognised by Deliveroo for collective bargaining interfere with the rights of Deliveroo riders to form and join a trade union under Article 11 of the European Convention on Human Rights? If so, was this interference justified? Should the courts below have construed section 296(1)(b) of the 1992 Act so as to give effect to Article 11?

This appeal concerns collective bargaining rights in respect of Deliveroo riders. The appellant, the Independent Workers Union of Great Britain (“the Union”) is an independent trade union whose members include Deliveroo riders. The second respondent, Roofoods Ltd (“Deliveroo”) operates the Deliveroo food and drinks delivery service.

On 28 November 2016, the Union submitted an application to the first respondent, the Central Arbitration Committee (“the CAC”), that the Union should be recognised by Deliveroo for collective bargaining in respect of a group of Deliveroo riders in the Camden zone. Applications are considered by the CAC in accordance with Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act 1992 (“the 1992 Act”). The CAC refused to accept the Union’s application on the basis that the riders were not “workers” within the meaning of the 1992 Act. This was because Deliveroo did not require them to provide delivery services personally, but permitted the use of substitutes, i.e. they did not provide “personal service”.

Both the High Court and the Court of Appeal dismissed the Union’s claim for judicial review of the CAC’s decision. The Union then appealed to the Supreme Court.

In a unanimous decision delivered by Lord Lloyd-Jones and Lady Rose in a joint judgment, the Supreme Court agreed with the previous decisions of the lower courts that the Deliveroo riders in question did not have an employment relationship with Deliveroo for the purposes of article 11 of the European Convention on Human Rights (ECHR) (i.e. the right to freedom of peaceful assembly and to freedom of association with others, including the right to form and to join trade unions), and therefore the provisions of that article did not apply to them.

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Termination: No ‘special circumstances exception’ when assessing resignation or dismissal

In Omar v Epping Forest District Citizens Advice [2023] EAT 132 the EAT had to consider the position of a claimant who had resigned ‘in the heat of the moment’ and then sought to retract the resignation. The claimant had contended that he should not be treated as having resigned as the situation fell within the so-called ‘special circumstances exception’ recognised in Sothern v Frank Charlesly [1981] IRLR 278. He argued that he had been unfairly and wrongfully dismissed. The employment tribunal disagreed and found that the claimant had resigned.

The EAT held, among other things, that the employment tribunal had erred in law by failing to make adequate findings of fact and failed to direct itself properly in accordance with the applicable legal principles set out in Sothern v Frank Charlesly. The EAT summarised the case law on the issue, including, among other things, that:

there is no such thing as the ‘special circumstances exception’; the same rules apply in all cases where notice of dismissal or resignation is given in the employment context;
words of dismissal or resignation, or words that potentially constitute words of dismissal or resignation, must be construed objectively in all the circumstances of the case in accordance with normal rules of contractual interpretation (i.e. the reasonably bystander test);
the subjective uncommunicated intention of the speaking party is not relevant, but the subjective understanding of the recipient is relevant but not determinative in assisting the tribunal form a judgment as to what the reasonable bystander would have thought.

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Tribunals: Tribunal’s failure to allege dishonesty amounted to a serious procedural irregularity

In Stuart Harris Associates Ltd v Gobudhun [2023] EAT 145 the EAT dismissed the respondent employer’s appeal against the decision of the employment tribunal that held that: first, the claimant employee had been constructively dismissed; and second, the respondent had been either dishonest or incompetent when they engaged in the expenses practice that had led to the claimant’s resignation.

The respondent contended that the employment tribunal had erred in law since: (i) it had prejudged the case; (ii) descended into the arena by conducting their own extensive research into the law and practice of filing tax returns; and (iii) determined that the respondent’s principal, had been either ‘dishonest’ or ‘incompetent’ when it had not been put to him in terms that his conduct was dishonest or incompetent.

The EAT held, among other things, that: (i) the failure to put to the respondent that he had acted dishonestly amounted to a serious procedural irregularity which meant that the finding of dishonesty had to be set aside; and (ii) there had been no prejudgment of the case and the employment tribunal’s conduct regarding the hearing had not been unfair.

Consequently, given that the employment tribunal’s conclusions as to unfair constructive dismissal could stand irrespective of the finding as to dishonesty, the decision overall remained and was not set aside.

Further Information:

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Employment Law General Update – December 2023

Employment,
15th December 2023

Employment Law

This month we have a plethora of publications and information for you. There are changes to National Living Wage, benefit and pension rates all due in April 2024. Two reports have been published recently looking at pay gaps for those with disabilities and people with different ethnicities, unsurprisingly the news is not positive. Some helpful guidance from the Home Office for employers to ensure they avoid the new raised penalties for employing illegal workers, and the government’s response to the occupational health consultation has been published. Lastly, the CIPD has produced an interesting report on menstruation at work, which is well worth a read to understand how this affects a large proportion of the workforce and what can be done to support women at work.

Wage Updates: National Living Wage to apply to all workers aged 21+ from April 2024
Wage Updates: New benefit and pension rates published for 2024-25
Pay Disparity: TUC publishes latest data on disability pay gap
Pay Disparity: ONS publishes new report on ethnicity pay gaps in the UK
Immigration: Home Office publishes updated Code of Practice on illegal working penalties
Health at Work: Government publishes response to occupational health consultation
Health at Work: CIPD report on menstruation and support at work

Wage Updates: National Living Wage to apply to all workers aged 21+ from April 2024

The government has accepted the Low Pay Commission (LPC) recommendations on National Minimum Wage (NMW) and National Living Wage (NLW) rates to apply from 1 April 2024. The LPC notes that this is the largest ever increase to the minimum wage in cash terms. The National Living Wage will apply to all workers aged 21 and over from 1 April 2024 (previously applying only to those aged 23 and over). The new rates are as follows:

• 21 and over rate: £11.44 per hour
• 18–20 year old rate: £8.60 per hour
• 16–17 year old rate: £6.40 per hour
• Apprentice rate: £6.40 per hour
• Accommodation offset: £9.99 per week

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Wage Updates: New benefit and pension rates published for 2024-25

The government has published proposed new benefit and pension rates for 2024 to 2025 including in respect of Statutory Maternity Pay (SMP), Statutory Paternity Pay (SPP), Statutory Adoption Pay (SAP), Statutory Shared Parental Pay (SSPP), Statutory Parental Bereavement Pay (SPBP), Maternity Allowance (MA) and Statutory Sick Pay (SSP). The rates of these benefits are normally increased in April each year in line with the Consumer Prices Index (CPI). The Written Statement to Parliament by the Secretary of State for Work and Pensions, Mel Stride, states that these rates will rise by 6.7% in line with CPI for the year to September 2023 and the new rates for the tax year 2024–2025 will come into effect on 8 April 2024. The DWP policy paper reveals that:

the standard rate for Statutory Maternity Pay (SMP), ie the rate that applies after the first 6 weeks of pay at 90% of the employee’s normal weekly earnings, will increase from £172.48 to £184.03 per week (or be set at 90% of the employee’s weekly earnings if that amount is lower);
the standard rate for Statutory Adoption Pay (SAP), ie the rate that applies after the first 6 weeks of pay at 90% of the employee’s normal weekly earnings, will increase from £172.48 to £184.03 per week (or be set at 90% of the employee’s weekly earnings if that amount is lower);
the rate for Statutory Paternity Pay and Statutory Shared Parental Pay (SPP and SSPP) will increase from £172.48 to £184.03 per week (or be set at 90% of the employee’s weekly earnings if that amount is lower);
the rate for Statutory Parental Bereavement Pay will increase from £172.48 to £184.03 per week (or be set at 90% of the employee’s weekly earnings if that amount is lower);
the rate for Maternity Allowance (MA) will increase from £172.48 to £184.03 per week (or be set at 90% of the individual’s weekly earnings if that amount is lower);
the rate of Statutory Sick Pay (SSP) will increase from £109.40 to £116.75 per week;
the amount of the weekly lower earnings limit, that applies to National Insurance contributions, below which employees are not entitled to SMP, SPP, SAP, SSPP and SSP (but remain entitled to Maternity Allowance) will remain at £123.

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Pay Disparity: TUC publishes latest data on disability pay gap

The Trades Union Congress (TUC) has published new analysis of the pay gap between non-disabled and disabled workers. According to data from the TUC, the pay gap is currently higher than it was 10 years ago, with non-disabled workers earning approximately 14.6% more than disabled workers. That makes for a pay difference of £3,460 a year for someone working a 35-hour week – and means that disabled people effectively work for free for the last 47 days of the year. Disabled women face an even bigger pay penalty of 30% (£3.73 an hour, £130.55 a week, or £6,780 a year) less than disabled men – effectively double discrimination. The research also shows that the disability pay gap persists for workers for most of their careers. At age 25 the pay gap is £1.73 an hour hitting a high of £3.18 an hour, or £111.30 a week, for disabled workers aged 40 to 44.

The analysis looked at pay data from across the country and found disability pay gaps in every region and nation of the UK. The highest pay gaps are in Wales (21.6% or £2.53 an hour), followed by the South East (19.8% or £2.78 an hour) and the East of England (17.7% or £2.30 an hour).

The research found that disability pay gaps also vary by industry. The biggest pay gap is in financial and industrial services, where the pay gap stands at a huge 33.2% (£5.60 an hour).

Not only are disabled workers paid less than non-disabled workers, they are also more likely to be excluded from the job market. Disabled workers are twice as likely as non-disabled workers to be unemployed (6.7% compared to 3.3%). And the analysis shows disabled BME workers face a much tougher labour market – one in 10 (10.4%) BME disabled workers are unemployed compared to nearly one in 40 (2.6%) white non-disabled workers.

The analysis shows that disabled workers are more likely than non-disabled workers to be on zero-hours contracts (4.5% to 3.4%). And disabled BME women are nearly three times as likely as non-disabled white men (6.0% to 2.2%) to be on these insecure contracts.

The TUC says zero-hours contracts hand the employer total control over workers’ hours and earning power, meaning workers never know how much they will earn each week, and their income is subject to the whims of managers. The union body argues that this makes it hard for workers to plan their lives, look after their children and get to medical appointments. And it makes it harder for workers to challenge unacceptable behaviour by bosses because of concerns about whether they will be penalised by not being allocated hours in future.

The report goes on to discuss how Labour’s New Deal for Working People would affect workers’ rights.

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Pay Disparity: ONS publishes new report on ethnicity pay gaps in the UK

The Office for National Statistics (ONS) has published a new report on ethnicity pay gaps in the UK for 2022 which reveals, in particular, that Black, African, Caribbean or Black British employees continue to earn less median gross hourly pay than White employees, which has been consistent since 2012.

The main points from the report are that in the UK in 2022:

Black, African, Caribbean or Black British employees earned less (£13.53) median gross hourly pay than White employees (£14.35)
between 2012 and 2022, Black, African, Caribbean or Black British employees were the only ethnicity group to be consistently earning less than White employees
country of birth had an impact on how much employees earned: UK-born Black, African, Caribbean or Black British employees earned more (£15.18), while non-UK-born Black British employees earned less (£12.95) when compared with UK-born White employees (£14.26), a pay gap of negative 6.5% and 9.2% respectively
after holding personal and work characteristics constant, to provide an adjusted pay gap based on a like-for-like comparison, UK-born White employees earn more on average than most ethnic minority employees
when adjusting for pay-determining characteristics (e.g. occupation or where the job is), the pay gap narrowed and in some instances reversed, for example:
- UK-born Asian or Asian British employees earned on average 11.9% more than UK-born White employees, but after adjustment it was estimated that they earned 1.9% less
- UK-born Black, African, Caribbean or Black British employees, move from earning 6.5% more to earning 5.6% less compared with White employees

Other findings included that:

in relation to Mixed or Multiple ethnic groups, White and Black Caribbean employees (a Mixed ethnic group) had the lowest median gross hourly earnings (£11.75) in 2022, compared with White British employees (£14.42). This was a pay gap of 18.5%, the opposite of what was seen for the overall Mixed or Multiple ethnic employees
Asian or Asian British employees in 2022 earned more than White employees, with a pay gap of negative 3.3%. However, based on the more detailed ethnicity classification of Asian or Asian British employees in England and Wales, Chinese and Indian employees had higher earnings compared with White British employees, while Bangladeshi and Pakistani employees earned less compared with White British employees
a breakdown of White employees showed that the highest earnings were reported by White Irish employees (£20.20 median gross hourly pay), which represents a pay gap of negative 40.1% relative to White British employees. This suggests that White Irish employees are in higher-paid occupations
the main factors that explain most differences between the groups were: occupation, highest qualification level, geography, age and sex

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Immigration: Home Office publishes updated Code of Practice on illegal working penalties

The Home Office has published a new draft Code of Practice on the civil penalty schemes for employers (preventing illegal working). The draft is an update to the version published in March 2022 and will be the sixth version of the code. This latest version of the code will be applied to all right to work checks from 22 January 2024 including where a follow-up check is required to maintain a statutory excuse, even if the initial check was undertaken using a previous version of the code which was current at the time. There will be a sixty thousand pound (£60,000) (up from twenty thousand pounds (£20,000)) maximum penalty applied to any employer found to have been employing a person who is disqualified from working by reason of their immigration status in the UK.

The advise is that employers have a key role to play in preventing illegal working in the UK. They do this by carrying out right to work checks on people before employing them, to make sure they are allowed to do the work in question. If you are in any doubt, please contact us so that we can help you avoid a penalty.

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Health at Work: Government publishes response to occupational health consultation

The Department for Work and Pensions has published its response to the consultation it held on increasing employer use of Occupational Health Services entitled ‘Occupational Health: Working Better’. The government has evaluated the responses to the consultation and opted to introduce a voluntary minimum framework for quality occupational health provision and explore new voluntary workplace health and disability standards, examining options for a new small- and medium-sized enterprise group purchasing framework, and learning from the existing Workforce Expansion scheme to develop a long-term strategic occupational workforce approach.

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Health at Work: CIPD report on menstruation and support at work

The Chartered Institute of Personnel and Development (CIPD) has published the findings from its survey of over 2,000 women, aged 18–60. The report, CIPD: Menstruation and support at work looks at the prevalence and type of menstruation symptoms, their impact on work, menstrual health conditions and the impact these have on the ability of employees to stay in and progress at work. It highlights the difference workplace support can make and the types of adjustments that are seen to be most helpful when managing symptoms at work.

This detailed report provides an eye-opening (and at times quite shocking) insight into the extent to which women experience symptoms from menstruation (i.e. periods) and from menstrual health conditions, and the impact these have on them at work.

The report is helpful to both employers and employees in demonstrating the scale of the problem and the need for an open and supportive workplace—this may form part of the employer’s work on employee wellbeing or ESG issues.

Managers need to be educated and trained about menstruation and menstrual health and the employer should encourage a culture where women feel comfortable discussing their symptoms and the impact these have on them. This would benefit everyone because it would reduce misunderstandings about absences, reduce the risk of discrimination and, in time, hopefully help to reduce gender pay gaps.

In the report the CIPD explains that:

‘Employers offering appropriate support in the workplace can help people feel included, offer dignity and reduce embarrassment. It can increase employee attendance, but also legitimise absence where this is needed. It can increase employee performance, engagement, retention and employer branding.

Employers can improve employee experience by creating environments and work cultures that are menstruation friendly, and providing support for menstrual health conditions that are underpinned by the principles of compassion, empathy and inclusivity.’

The introduction to the report explains that:

the survey included over 2,000 women, aged 18-60, who currently menstruate, or have previously menstruated, while in employment;
‘menstruation’ refers to the monthly period in which bleeding occurs;
‘menstrual health’ has a broader meaning and recognises that while menstruation is a natural bodily function, some people experience physical and/or mental health symptoms and challenges linked to menstruation. These range from painful, heavy and/or irregular periods and premenstrual syndrome (PMS) through to formally diagnosed chronic health conditions such as endometriosis, adenomyosis, polycystic ovary syndrome (PCOS) and premenstrual dysphoric disorder (PMDD). Some of these conditions can have significant impacts on daily life and can also affect fertility;
while the report predominantly references women in relation to menstruation and menstrual health, the CIPD recognises that there is also an impact on some transgender and non-binary individuals who will require support and flexibility relevant to their needs.

What were the key findings?

Prevalence of symptoms

The responses to the survey showed that:

57% of those responding currently menstruate each month and 92% say they have previously menstruated each month while in employment;
79% of respondents have experienced menstruation symptoms, with the most common being abdominal cramps (60%), feeling irritable (52%), fatigue (49%), bloating (49%) and low mood (47%), but there are a wide range of symptoms;
those aged 18–34 were more likely to experience a high proportion of the symptoms;
15% have a menstrual condition such as endometriosis, PCOS, PMDD or fibroids.

Impact at work

In relation to how these symptoms impacted on people at work, the report states that:

69% of those who have experienced symptoms from menstruation report that they have had a negative impact at work, rising to 81% for people with a diagnosed menstrual condition;
the kinds of effects people have experienced are many and varied, but the main ones are feeling more tired (79%), working when they haven’t felt well enough to do so (61%) and feeling less able to concentrate (63%);
53% had been unable to go to work at some point because of menstruation symptoms and for 4% this was the case every month;
49% never tell their manager that their absence is related to their menstrual cycle;
20% always tell their manager that their absence is related to their menstrual cycle;
employees are less likely to tell their manager if their manager is male;
reasons given for not telling their manager the real reason included that they felt the problem would be trivialised (45%), feeling embarrassed (43%), that they prefer to keep the matter private (42%), that there’s too much stigma/ taboo (35%), that the employer/ manager wouldn’t be understanding (24%), having a male manager (24%) and worried the manager would think that performance would be affected (19%);
people are more likely to feel supported by colleagues than by their employer or manager (41%, compared with 21% and 26%, respectively);
12% of employees report that their organisation provides support for menstruation and menstrual health and 67% said there is no support available;
the most common support available is free period products (18%), paid sick leave (15%) and paid time off for medical appointments (12%);
the types of support that respondents said would be most helpful included free period products (53%), planned flexible working (44%), more breaks when needed (41%), paid time off for medical appointments (39%), paid sick leave (32%), access to a rest room (e.g. lounge area) (31%), adjustments to work tasks (28%), a better equipped bathroom (e.g. with a shower) (27%), clothing change (25%), and free hot water bottles (23%).

The wider impact of menstruation at work

The findings of the report include that:

6% of respondents say that menstrual symptoms have impacted them in a way which has led to formal action at work;
7% feel they have been discriminated against at work because of menstrual symptoms (those with a male manager (8%) are more likely to say this than those who have a female manager (4%));
a lack of support has promoted 8% to leave or consider leaving their jobs;
12% say that their menstrual symptoms have had a negative impact on their career progression;
workplace support makes a difference with those who work in organisations without support more likely to say that their symptoms had a negative impact on their career progression (14% compared with 5% who work for organisations with support).

Recommendations and good practice

The CIPD makes the following recommendations for supporting menstrual health in the workplace:

build an open and inclusive culture where menstruation is normalised thorough supportive discussions and open dialogue;
create awareness and tackle stigma;
develop a support framework;
train and support people managers.

For full details of how these can be implemented, see pages 13–14 of the report.

In addition to the recommendations above, organisations can offer specific support for employees experiencing menstrual health conditions, e.g.:

embedding good people management practices;
creating the climate for successful sharing of information;
ensuring employees have easy access to information and support;
managing absence and performance management with compassion and flexibility;
providing access to, and training in, work adjustments.

For further information on ways to implement these in the context of menstrual wellbeing and health, see pages 14–15 of the report.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – November 2023

Employment,
22nd November 2023

Employment Law

This month’s employment law updates cover various critical issues. The Work and Pensions Committee seeks input on statutory sick pay, while the Government has published its response to the EU employment law consultations. The Home Office updates illegal working penalty guidelines, and we have Government guidance on the handling labour unions before strikes. The TUC’s data on the disability pay gap underscores the importance of inclusivity, and a WoRC report examines systemic factors in the exploitation of migrant workers. Stay informed for compliance in this evolving employment landscape.

Sick Pay: Work and Pensions Committee publishes call for evidence on statutory sick pay
Retained EU Employment Law: Government response to consultation and new draft regulations available
Immigration: Home Office publishes updated code of practice on illegal working penalties
Trade Unions: Government publishes guidance on issuing work notices ahead of strike action
Disability: TUC publishes latest data on disability pay gap
Immigration: WoRC report looks at systemic drivers of UK migrant worker exploitation

Sick Pay: Work and Pensions Committee publishes call for evidence on statutory sick pay

The Work and Pensions Committee has issued a call for evidence on statutory sick pay (SSP), requesting the public views and ability to submit evidence until Friday, 8 December 2023. The Work and Pensions Select Committee calls for this inquiry to assess the existing ‘effectiveness of SSP in supporting claimants and if SSP should be reformed to better enable a recipient’s recovery and return to work’.

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Retained EU Employment Law: Government response to consultation and new draft regulations available

Retained EU Employment Law consultation response

The government has officially released its response to the ‘Retained EU Employment Law’ consultation, addressing proposed reforms within the Working Time Regulations 1998 (WTR) related to annual leave, holiday pay calculations, and record-keeping requirements. Additionally, it responded to the consultation concerning the annual leave entitlement calculation for part-year and irregular hours workers in light of the Supreme Court’s Harpur Trust v Brazel 2022 ICR 1380 decision.

The government has proposed the introduction of a ‘rolled-up’ holiday pay system for irregular hours and part-year workers and allow for an annual leave accrual method of 12.07% of hours worked for these groups. This means that instead of receiving a separate payment when taking annual leave, certain workers, specifically those with irregular hours or part-year employment (which may include agency workers), will get an extra amount added to their regular pay.

However, the government has decided not to proceed with the idea of creating a single annual leave entitlement that combines the ‘basic’ and ‘additional’ annual leave entitlements into a single 5.6-week entitlement (i.e. four weeks required by EU law and the 1.6 weeks mandated by the Working Time Regulations). Instead, they want to maintain two separate “pots” of annual leave with two different pay rates. This means that workers will still receive four weeks of leave at their normal pay rate and 1.6 weeks at a basic pay rate.

Additionally, the government plans to pass laws to make it clearer what should be included in the calculation of normal remuneration for holiday pay. They are also considering more significant changes to how holiday pay rates are determined.

In response to the Harpur Trust ruling, the initial proposal suggested using a 52-week reference period to calculate annual leave entitlement. However, many people raised concerns about the extra work this would create and the challenges it posed for workers whose hours changed from year to year or for those in their first year of employment.

To keep things simpler, the government has opted for a different approach. They will use an accrual method to figure out annual leave entitlement, where workers get 12.07% of the hours they’ve worked in a specific pay period. This method was commonly used before the Harpur Trust decision and better reflects the hours a worker has actually worked in the current year. For other workers in their first year of employment, things will remain the same. They will continue to accrue annual leave by receiving 1/12th of their statutory entitlement on the first day of each month and adjusting it accordingly.

The response also mentions that the government will maintain certain EU case laws to protect workers’ rights regarding carrying over unused annual leave when they can’t take it due to maternity, family-related leave, or being sick. They will also introduce a way for irregular hours and part-year workers to accrue annual leave when they’ve had periods of maternity, family-related leave, or sickness.

Additionally, the government will proceed with changes to record-keeping requirements in the Working Time Regulations (WTR). This change clarifies that businesses do not have to keep daily records of how many hours each worker works. This clarification aims to address concerns that a previous ruling by the European Court of Justice might have required employers to track the exact daily hours worked by each employee, rather than maintaining adequate and proportionate records based on the workplace and working patterns.

Regarding TUPE (Transfer of Undertakings), the government will move forward with its proposal to simplify consultation obligations during a transfer. Small businesses (with fewer than 50 employees) will be allowed to directly consult with employees if there are no existing employee representatives, avoiding the need to organize elections for new representatives. Additionally, businesses of any size can directly consult with employees (if there are no existing representatives) when a transfer involves fewer than ten employees.Top of Form

Draft Regulations

The Department of Business and Trade has published the draft Equality Act 2010 (Amendment) Regulations 2023. The draft SI restates some protections in relation to pregnancy, maternity and breastfeeding, indirect discrimination, access to employment and occupation, equal pay and the definition of disability which would otherwise be lost from 1 January 2024 under the Retained EU Law (Revocation and Reform) Act 2023 (REUL(RR)A 2023).

These draft regulations are proposed to reproduce in domestic law certain interpretive effects of retained EU law which, under REUL(RR)A 2023, will cease to apply to the UK statute book after the end of 2023. This will mean that, in the areas covered by this instrument, the law will continue to have the same effect after the end of 2023 as it did before. They are due to come into force on 1 January 2024.

The draft Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 will amend the Working Time Regulations 1998 (in relation to record-keeping, paid holiday for irregular hours workers and part-year workers, normal pay, and the carrying forward of paid holiday) and the Transfer of Undertakings (Protection of Employment) Regulations 2006 (in relation to information and consultation obligations on small businesses for transfers on or after 1 July 2024) and revoke the European Cooperative Society (Involvement of Employees) Regulations 2006. They are due to come into force on 1 January 2024.

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Immigration: Home Office publishes updated code of practice on illegal working penalties

The draft code has been amended further to the issue of draft Statutory Instruments (SIs) which will raise the starting point for penalties to £45,000 for a breach (if there are no previous breaches in the last three years) and £60,000 for repeated breaches. The draft codes will come into force at the same time as the related SIs, which are: (Employment of Adults Subject to Immigration Control) (Maximum Penalty) (Amendment) Order 2023 and the Immigration (Restrictions on Employment and Residential Accommodation) (Codes of Practice) (Amendment) Order 2023. These are each stated to come into force on 22 January 2024, or, if later, on the twenty-first day after the day on which it is made. However, the code assumes 22 January 2024 as a commencement date.

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Trade Unions: Government publishes guidance on issuing work notices ahead of strike action

The Department of Business and Trade has published guidance for employers, trade unions and workers on issuing work notices ahead of strike action. Work notices, which were introduced under the Strikes (Minimum Service Levels) Act 2023, allow employers to require a workforce to meet minimum service levels for an upcoming strike period where the trade union has given notice to the employer of the strike and the employer provides a service covered by minimum service level regulations.

The new guidance is designed to be read alongside the government’s range of guidance on industrial action which can be found here.

The guidance covers:

the purpose of a work notice and the steps for preparing it;
considerations when preparing a work notice;
considerations upon deciding to issue a work notice;
consulting with trade unions;
guidance on producing a work notice;
guidance on notifying workers of a notice;
duties on workers and trade unions following issue of a work notice;
data protection issues.

The full guidance can be found here.

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Disability: TUC publishes latest data on disability pay gap

The Trade Union Congress (TUC) has published new analysis [TUC slams “zero progr<a id=”back”></a>ess” on disability pay gap in last decade | TUC] of the pay gap between non-disabled and disabled workers. According to data from the TUC, the pay gap is currently higher than it was 10 years ago, with non-disabled workers earning approximately 14.6% more than disabled workers.

The key findings of the analysis include:

the pay gap is only marginally lower than it was when the TUC launched disability Pay Gap Day in 2016/17;
disabled women face the biggest pay penalty with non-disabled men earning an average of 30% more;
the industry with the biggest pay gap is financial and industrial services which currently stands at 33.2%;
disabled workers are twice as likely to be unemployed than non-disabled workers;
one in 10 BME disabled workers are unemployed compared to nearly one in 40 white non-disabled workers;
disabled workers are more likely to be on zero-hours contracts than non-disabled workers.

The TUC has called for action from the government to put an end to discrimination against disabled workers in the labour market and has backed Labour’s New Deal for Working People.

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Immigration: WoRC report looks at systemic drivers of UK migrant worker exploitation

The charity Work Rights Centre (WoRC) has published a report which looks at what lies behind increasing reports of migrant worker exploitation in the UK, particularly in certain sectors such as health and care. Drawing on 40 case studies, interviews with caseworkers, and policy analysis, the report identifies the post-Brexit work sponsorship system and piecemeal/weak labour enforcement as two key systemic drivers. It makes a number of recommendations, including reforms to the work sponsorship system (replacing employer sponsorship entirely, or alternatively a range of reforms to the sponsorship system to facilitate protection of sponsored migrants against exploitation), increasing protections for all workers (including establishing a Single Enforcement Body for all labour rights, giving protection against unfair dismissal from the first day of employment and instituting secure reporting of exploitative practices), and implementing a migrant worker welfare strategy (including the creation of an independent Migrant Commissioner role).

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law Case Update – November 2023

Employment,
22nd November 2023

Employment Law

This month’s case law shines a light on a less-common area of worker status – where a partnership is providing a service to a company and how to ensure no employee relationship is found, and provides a useful insight into using comparators for discrimination claims.

Worker Status: Individual providing services through genuine partnership cannot be an employee
Constructive Unfair Dismissal: Incorrect use of hypothetical comparators
Race Discrimination: Differentiating comparators

Worker Status: Individual providing services through genuine partnership cannot be an employee

In Anglian Windows Ltd t/a Anglian Home Improvements v Webb [2023] EAT 138 the EAT held that if there is an agreement between a genuine partnership and an employer for the partnership to provide certain services, then, providing that the arrangement is not a sham, there cannot also be an employment relationship between the individual partner providing those services and the employer, and, accordingly that partner cannot bring a claim of unfair dismissal against the employer (because they do not have the necessary status of being an employee).

This judgment concerns the unusual situation of a partnership entering into an agreement with a company for one of its partners to perform a sales role and then that individual partner trying to claim that they are an employee of that company in order to claim unfair dismissal.

The claimant and his wife had a partnership trading as Webb Consultants. The claimant was appointed as Area Sales Leader for the respondent but provided services (and was paid) through Webb Consultants. The contract provided that the claimant would not be an employee and would ‘at all times remain either a self-employed sole trader, a limited company or a partnership’. The claimant was dismissed and claimed unfair dismissal. The respondent applied to strike out the claim on the basis that it did not have reasonable prospects of success because the claimant was not an employee.

The employment tribunal refused to strike out the claim on the basis that the fact of these arrangements (which involved a genuine partnership and were not suggested to be a sham) did not preclude the possibility of the claimant being able to establish employee status. In reaching this conclusion, the tribunal sought to distinguish the EAT’s decision in Firthglow Ltd v Descombes and anor UKEAT/0916/03. The respondent appealed.

The EAT disagreed with the tribunal’s finding. The EAT held that the tribunal had erred in seeking to draw a distinction between this case and Descombes, where it had been held that, where the relevant work was being undertaken under an agreement with a partnership, that precluded the possibility of one of the individual partners being able to claim he was an employee. The tribunal ought to have followed Descombes. Although it was open to the EAT not to follow a previous decision at this level, none of the circumstances that might warrant adopting this course of action. Moreover, the agreed facts, confirmed by the tribunal’s own findings, meant that the possibility of the existence of a contract of employment between the claimant and the respondent was precluded in the circumstances of this case. That being so, the claimant’s claim of unfair dismissal could have no reasonable prospect of success and the tribunal ought to have allowed the respondent’s strike out application. Therefore the appeal was allowed, the tribunal’s judgment set aside and a finding substituted that the claimant’s claim must be dismissed as having no reasonable prospect of success.

Although employers might, as a result of this judgment, be tempted to engage people to work for them through a partnership (as a means of avoiding them gaining rights as employees) the fact that the courts and tribunals will look behind any such arrangement to determine whether it is a sham, and not reflecting the true agreement between the parties, should discourage them from doing so in practice.

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Constructive Unfair Dismissal: Incorrect use of hypothetical comparators

In The No. 8 Partnership v Simmons [2023] EAT 140 the claimant pursued claims of constructive unfair dismissal and of direct associative disability discrimination, relating to the respondent’s refusal to grant her time off for her dependent father under section 57A Employment Rights Act 1996. In considering the claim of direct discrimination, the Employment Tribunal constructed hypothetical comparators without first giving the parties the opportunity to give evidence or make submissions on the hypothetical circumstances envisaged. The tribunal also found that the reason for the refusal of section 57A leave was the respondent’s unwarranted misinterpretation of the section and that one of the decision-makers was dismissive of the care that aged parents required. Having found that the respondent had thus discriminated against the claimant, the tribunal concluded that this meant that it had breached the implied term of trust and confidence, which had also been breached by the respondent’s failure to personally communicate with the claimant before reaching any decision. The respondent appealed.

The EAT allowed the appeal. By failing to afford the parties the opportunity to address its hypothetical comparisons (in evidence or submissions), the tribunal had adopted an unfair procedure. The comparators thus constructed were also flawed as they failed to provide a like-for-like comparison for the purposes of section 23 Equality Act 2010 and, in the case of the second case, relied on a comparison with an individual sharing the same protected characteristic as the claimant. Moreover, given its finding as to the respondent’s reason for refusing section 57A leave, it was perverse of the tribunal to conclude that this was because of the claimant’s father’s disability. That conclusion was also perverse given the tribunal’s further finding that one of the respondent’s partners would have treated any carer of an aged parent (regardless of disability) in the same way.

Having allowed the appeal against the finding of discrimination, this also undermined the tribunal’s reasoning on constructive unfair dismissal. The alternative basis for that conclusion was, however, also flawed as the tribunal had failed to apply the correct test when determining whether there had been a breach of the implied term of trust and confidence and had failed to provide an adequate explanation of it finding that a breach arose from a failure of personal communication.

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Race Discrimination: Differentiating comparators

In the direct race discrimination case of Virgin Active Ltd v Hughes [2023] EAT 130, the question before the EAT was whether it was correct for the employment tribunal to consider a colleague who had made a comment about her own race as a valid comparator for a claimant who had made a comment about a colleague’s race.

The claimant in this case was a gym manager who had been dismissed. He had won several claims at the tribunal, including unfair dismissal, automatic and ‘ordinary’ unfair dismissal, and race discrimination concerning the handling of his disciplinary process and a grievance. The respondent appealed on various grounds and succeeded in overturning the findings related to race discrimination.

The tribunal had considered three of the claimant’s colleagues as comparators, even though their situations appeared significantly different from the claimant’s. The tribunal argued that the differences in treatment of these comparators shifted the burden of proof and upheld the complaint.

However, the EAT disagreed with the tribunal’s approach. It pointed out that the tribunal had not adequately assessed whether the claimant’s comparators were indeed suitable comparators, given their differing circumstances. A tribunal should carefully evaluate any material differences between a claimant and a valid comparator. The more significant the differences in their circumstances, the less likely the disparate treatment indicates discrimination. To illustrate this, the EAT provided an example: if two individuals of different races both undergo a job interview and one succeeds while the other does not, this alone wouldn’t be enough to shift the burden of proof. However, if both candidates scored equally in an assessment but were treated differently, that might indeed warrant shifting the burden of proof.

Additionally, the judgment highlighted that delay, on its own, is not sufficient grounds for an appeal. (The judgment had been delayed due to the Employment Tribunal Judge’s serious ill-health.)

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law Back to Basics – Employing People in England & Wales

Anne-Marie Pavitt,
14th November 2023

Employment Law

We set out below a handy reminder of the issues, obligations and requirements that you need to consider when employing individuals in England for the first time.

Check your business is ready to take on employees

Make sure that your workplace is safe and accessible for employees. All employers have a duty to provide a safe working environment. The Health and Safety Executive website provides a wealth of guidance to assist you in this area Health and safety basics for your business (hse.gov.uk)

Register as an employer and set up PAYE

You will need to register as an employer with HM Revenue and Customs (HMRC) before your employee’s first payday. Do bear in mind that it can take up to 15 working days to get your employer PAYE reference number. You may choose to engage a payroll providers who can do this on your behalf. Payroll providers can also offer additional support such as providing payslips and calculating holiday entitlements so you should consider if you want or need these extra services or would rather deal with these inhouse.

Obtain Employers’ Liability insurance

All employers must have Employers’ Liability (EL) insurance cover for at least £5 million (from an authorised insurer) as soon as staff are employed. EL insurance will help an employer pay compensation if an employee is injured or becomes ill because of the work they do for you.

Check your employer’s pension obligations

All eligible job holders are entitled to a workplace pension scheme so you need to be aware of your automatic enrolment duties as an employer. Your legal duties begin on the day your first member of staff starts work, and even if you think you will not need to put your staff into a pension scheme, you will still have certain duties you must comply with. A qualified pensions adviser can advise you on complying with such duties. More information can be obtained from The Pensions Regulator Workplace pensions law – auto enrolment | The Pensions Regulator

Recruitment

You may need to advertise the role and interview candidates or instruct a recruitment agency to assist you with this process. You must ensure you avoid any kind of discrimination during the recruitment process and make sure your application and interview process is accessible for employees with disabilities. Consider whether any offer of employment will be conditional upon e.g. reference checks or proof of certain qualifications.

Checking a job applicant’s right to work

You must check that a job applicant is allowed to work for you in the UK before you employ them. Checking a job applicant’s right to work – GOV.UK (www.gov.uk)

If the potential employee says they have the right to work in the UK you must verify this by either checking their right to work online (if they have given you their share code), checking certain specific original documents or using an identity service provider that offers Identity Document Validation Technology (IDVT). You could face a civil penalty if you employ an illegal worker and have not carried out a correct right to work check.

If the employee does not have the right to work in the UK they may still be able to work in the UK on a short or long-term basis with a work visa, and specialist Immigration Law advice should be obtained on this issue if applicable. We can provide such immigration advice.

Check if you need to undertake a Disclosure and Barring Service (DBS) check

You may wish to know whether a prospective employee has a criminal record and this can done for any employee via a basic DBS check. However, taking into consideration data protection rules, you should first consider whether a basic DBS check is really necessary for the type of role the individual performs and should certainly not have a blanket policy where DBS checks are used for all candidates. Enhanced “standard disclosure” checks are obligatory in certain roles which involve a high degree of trust and security, such as those who work with vulnerable adults or children. You are required to carry out an enhanced check on a candidate if the relevant role is listed in what is known as the “Exceptions Order” and also the Police Act 1997 (Criminal Records) regulations.

Decide how much you will pay the employee and how you will run your payroll

The rate of pay or salary will of course depend on factors such as the role the employee will be undertaking, their level of experience and/or knowledge and the typical salary expected in your industry. You must ensure the proposed pay complies with National Minimum Wage requirements which can vary depending on the employees age and the type of work they will be carrying out for you. You could either use payroll software to run your own payroll or instruct a payroll provider to do it for you. Specialist tax advisers can provide advice on National Minimum Wage, Income tax and National Insurance issues.

Prepare a Contract of Employment

Employees are legally entitled to a written statement setting out certain prescribed particulars of employment on or before their first day of employment. Some of the prescribed particulars must be included in a single document and the rest can be given in instalments, not later than two months after the beginning of the employment. Employers often put most or all of the required information into a single document, being the contract of employment. This contract is essential to give details of all the terms and conditions that will apply to the employment. Careful thought should be given to whether any additional terms should also be included, such as, requirement to undertake a probationary period, whether you will pay enhanced company sick pay and whether you want the right to place employees on garden leave, or pay them in lieu of notice at the end of employment. Such additional protections are not automatically included in a standard statement of employment. If you want these useful additional protections do get in touch and we can talk through your requirements and prepare a bespoke employment contract for your new recruits.

Prepare Employee Policies

Large employers often include a wide variety of employee policies in an Employee Handbook whereas those with fewer staff may prefer to prepare standalone policies covering the basic legal requirements. At minimum an employer should provide employees with access to:

a grievance procedure and a disciplinary procedure;
a health and safety policy which sets out your general approach to health and safety (this must be a written policy for those with five or more employees).
an employee privacy notice – employers are required to provide employees with specific information about the processing of their personal data to comply with data protection legislation.

Tell HMRC about your new employee

Before you pay your new starter you must register your employee with HMRC using a Full Payment Submission.

If you’re looking to recruit for the first time why don’t you give our Employment team a call?

Dixcart Legal Limited – November 2023

Dixcart UK has an experienced team of specialist accountants, lawyers, tax and immigration advisers who can advise on all aspects of employing people in the UK. Please get in touch for further details on hello@dixcart.com

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Employment Law Case Update – October 2023

Anne-Marie Pavitt,
24th October 2023

Employment Law

An interesting look at how not to exclude staff on maternity leave, how to properly handle transgender workers, calculating holiday pay where employees are subject to compulsory overtime and the use of contract clauses to retain employees where discretionary bonus payments are payable which do not amount to restraint of trade.

Sex Discrimination: Erosion of reputation as “an effective and useful member of staff” due to pregnancy is discriminatory
Sex Discrimination: ‘Deadnaming’ transgender worker amounts to less favourable treatment
Holiday Pay: Landmark case confirms a gap of three months or a correct payment does not necessarily break a series of deductions
Contract: Bonus clause conditional on staying in employment not restraint of trade

Sex Discrimination: Erosion of reputation as “an effective and useful member of staff” due to pregnancy is discriminatory

In Smith v Greatwell Homes (3316461/2021) a tribunal had to consider the employer’s actions and treatment of Ms Smith, following her declaration to her boss that she was pregnant. This case was reported in People Management on 13 October 2023:

Ms Smith began working at Greatwell Homes in March 2019 as a business improvement analyst within the business improvement team, where she was apparently a valuable and ambitious member of staff. The tribunal noted she was a “credible and consistent witness”. Within her team there were three members of staff: herself, a business improvement manager and a head of business intelligence. However, the person occupying the post of business improvement manager – the person who was meant to be Ms Smith’s line manager – had been absent from August 2019 due to long-term ill health. She never returned to work and resigned in early 2020. Consequently, Ms Smith was required to take on a “significant proportion” of the responsibilities that should have been her line manager’s.

The firm’s head of property services and compliance, Miss Herzig, viewed Ms Smith as a valuable member of the team and encouraged her to apply for a more senior post with line management responsibilities should one become available. In April 2020, Ms Smith informed Miss Herzig that she was pregnant. The tribunal found the news was not effectively communicated to human resources by Miss Herzig, and Ms Smith was required to confirm with HR that she was expecting a baby on two further occasions. “We find that this was symptomatic of the respondent’s attitude towards the claimant and/or to the fact she was pregnant,” it said.

Ms Smith’s first claim arose during the same month. All staff were given a free day off by the company as a thank you for their efforts during the Covid pandemic. The day off was a Friday, however, when Ms Smith mentioned that she did not work Fridays, the firm refused to allow her to take a different day off. In September 2020, she went on maternity leave. Other than a few emails from HR about pension matters and some personal messages from Miss Herzig, Ms Smith did not hear from her employer during her maternity leave.

Then in April 2021, Ms Smith received a text message from Miss Herzig in which she was informed that someone had been appointed as her new manager and the firm had also hired a Governance and Assurance Manager, which was only published internally on the company intranet. These were both roles, the tribunal ruled, that would have been opportunities for Ms Smith to progress within the company. The claimant was not happy about the text and what she perceived to be a lack of communication from the respondent during her maternity leave, which went against the company’s maternity policy – which stated that employees on maternity leave must be informed of job vacancies. She commenced a grievance which was heard by Mr Wilesmith, but it was not upheld.

In August 2021, the respondent began to send job adverts to Ms Smith. This included a re-advertisement of the Governance and Assurance Manager’s post, as the current person occupying the role was on a 12-month contract and it would end in April 2022. The claimant resigned by letter dated 31 August. By a letter of the same day, the respondent accepted her resignation.

The tribunal held that Ms Smith was treated less favourably by the respondent on the grounds that she was on maternity leave, and commented that neither Miss Herzig nor Mr Wilesmith were impressive witnesses. It noted: “Neither demonstrated sufficient knowledge, skills or empathy in the way they dealt with the claimant throughout this process. It was the tribunal’s view that both were ill-equipped to deal with equality and diversity issues. It is incumbent on an employer to make sure that appropriately skilled and experienced staff deal with equality and diversity issues. The respondent had singularly failed in this regard.”

Regarding the free day off, the tribunal said the firm’s decision to not allow her to reschedule a day off was “unfavourable towards part-time workers, and therefore indirectly discriminatory towards female members of staff, as well as deeply unsympathetic in relation to the claimant herself”. It also ruled that Ms Smith “clearly [had] less favourable treatment” because she was on maternity leave as she was “barred from the opportunity” of participating in any recruitment process, or the chance to compete with other applicants to progress her career.

Employment judge Wood said: “In our view, it is clear that Miss Herzig’s view of [Smith] as an effective and useful member of staff had been eroded by the knowledge that she had become pregnant and was on maternity leave. It may have been, in part, a subconscious attitude. Nonetheless, we are clear that it was the reason, or a significant part of the reason, for the unfavourable treatment.” It also said the firm’s decision to send Smith job ads in August 2021 for vacancies that were expected to become available in April the following year were just “window dressing” to disguise the treatment that had gone before. Greatwell Homes was consequently ordered to pay Ms Smith £50,000.

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Sex Discrimination: ‘Deadnaming’ transgender worker amounts to less favourable treatment

In AB v Royal Borough of Kingston upon Thames (ET/2303616/2021) the tribunal ruled that the Borough of Kingston Council had committed several acts of direct discrimination against its employee, Miss AB, because of her status as a transgender woman her while she was undergoing a gender transition by using her previous name. The Employment Tribunal upheld 10 of her claims and awarded her nearly £25,000 in damages.

The majority of the claims that succeeded were instances in which she was ‘deadnamed’—the term for referring to a trans person by the name, and therefore gender, that they used before they transitioned. The council used Miss AB’s deadname on her office door pass, her pension records, the staff directory, the internal complaints system and her parking pass, according to the judgment. All of these instances amounted to ‘less favourable treatment’ and were ‘because of the claimant’s protected characteristic’, the tribunal found. The tribunal also sided with Miss AB when she argued that management’s decision to remove some of her job responsibilities was an act of direct discrimination. ‘We conclude that [Miss AB’s manager] in taking this action was not simply acting unreasonably, but that the claimant’s protected characteristic was part of the reason for this treatment’, the tribunal ruled. ‘The claim therefore succeeds’.

The panel also found that management’s response to a complaint from Miss AB was direct discrimination because they failed to take the complaint seriously. It found that management ‘did not treat the claimant’s allegation with respect’ and demonstrated ‘a dismissive attitude towards the issue’. ‘We have to conclude that some part of his reaction was because of the claimant’s protected characteristic’, the panel ruled. Similarly, the tribunal held that a manager fell foul of discrimination law when he failed to properly escalate Miss AB’s complaint. ‘Again, we have to conclude that some part of his reaction and his lack of action was because of the claimant’s protected characteristic’, the panel said.

However, many of Miss AB’s claims failed because she filed them too late and did not give the judge a sufficient reason for her delay. Miss AB argued that her employer’s decision to cut off her direct contact with internal councillors was a discrete, rather than ongoing, act. However, the tribunal found that although the decision had ongoing consequences, it was a discrete act and it fell outside the tribunal’s time limits. The panel also found that a reprimand one of the managers gave Miss AB also took place too long before she filed her claim, but added that the claim would have failed in any event because the reprimand was a reasonable management response to her failing to obey an instruction.

The tribunal disagreed with Miss AB’s argument that the council’s failure to implement a health and safety risk assessment for gender transition was discrimination. There was no obligation to undertake such a risk assessment, the judgment said. The panel also found that the council did fail to have appropriate Equalities Act policies in place but said this ‘was not because of the claimant’s protected characteristic but because of HR failures on a wider scale’.

The tribunal awarded Miss AB £21,000 as compensation for injury to feelings plus £4,423 in interest.

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Holiday Pay: Landmark case confirms a gap of three months or a correct payment does not necessarily break a series of deductions

In Chief Constable of the Police Service of Northern Ireland and another v Agnew and others [2023] UKSC 33 it was held that police officers and civilian staff in Northern Ireland are entitled to claim for underpayments of holiday pay going back many years following their employer’s failure to include overtime in its holiday pay calculations.

The Claimants were police officers and civilian staff working for the police in Northern Ireland. The case arose because they had historically only received basic pay for annual leave but the parties had agreed there had been an underpayment because the holiday pay should have included periods of compulsory overtime. The claimants brought claims for underpayment of holiday pay, and the question before the court was how far did this underpayment go back? The relevant Northern Irish legislation (mirroring the Employment Rights Act 1996) provided that a claim could only be made in respect of a payment made in the three months before the claim was brought. However, if the deduction was part of a series, the deductions could be linked together provided that the claim was brought within three months of the last of the series of deductions.

Previously, the EAT in Bear Scotland v Fulton had previously concluded that deductions could only be linked in a series if there was a gap of three months or less between each deduction but here the Supreme Court has now held that where a series of deductions are all based on an employer failing to properly meets its obligations to pay holiday correctly and, but for the mandatory cut off after 3 months which was set out in Bear Scotland, they would otherwise constitute a series, employees should be able to link each deduction. To hold otherwise would produce unfair consequences.

The Supreme Court held that:

(1) the EU principle of equivalence requires the police officers to be allowed the more advantageous series extension found in the Employment Rights (Northern Ireland) Order 1996 even though they are not workers for the purposes of that legislation,

(2) the series extension is therefore read into the relevant part of the Working Time Regulations (Northern Ireland) 2016 to achieve this, and

(3) what constitutes a series of deductions is a question of fact which does not require a contiguous sequence and is not necessarily brought to an end by a gap of three months or a correct payment if that correct payment was calculated when the claimants were at work.

It further found that, (1) there is no legal requirement that leave derived from different sources must be taken in a particular order, (2) it is inappropriate to apply a general principle of using calendar days in the reference period when calculating a worker’s normal pay, and (3) the appropriate reference period when calculating normal pay in any case is a question of fact.

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Contract: Bonus clause conditional on staying in employment not restraint of trade

In Steel v Spencer Road LLP (trading as Omerta Steel) [2023] EWHC 2492 (Ch) the Chancery Division dismissed the appellant’s appeal from a decision which had dismissed his application to set aside a statutory demand served by the respondent. The appellant was a former employee of the respondent. Under the terms of his employment contract, his remuneration was by way of a basic annual salary plus a discretionary bonus scheme. The bonus was conditional on the appellant remaining in the employment of the respondent for three months from the date of payment of any bonus, and not having given or been given notice to terminate his appointment during that period.

In January 2022, the appellant was paid a bonus which was an amount considerably larger than his basic salary at the time. Later, he gave notice of termination of his employment in February. The respondent had requested repayment of the bonus under the clawback provisions in the employment contract. The appellant refused to do so and had argued that the bonus clawback provisions were unenforceable on the grounds that they were in restraint of trade and/or penalty clauses. The court held, among other things, that there was no doubt that an employee bonus or commission scheme which was conditional on the employee remaining in employment for a specified period of time operated as a disincentive to that employee resigning. That had not, however, turned such a provision into a restraint of trade.

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Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – October 2023

Anne-Marie Pavitt,
24th October 2023

Employment Law

Lots of useful guidance available this month: from the DWP about using fit notes; requirements for employers with regard to right to work checks; and understanding the UK GDPR and DPA legislation to protect your employees’ data.

Health at Work: DWP updates guidance on fit notes
Right to Work Checks: Employers are no longer required to verify a digital CoA with the ECS
Data Protection: UK government approves the UK-US data bridge
Data Protection: An employer’s guide to understanding UK GDPR and DPA 2018

Health at Work: DWP updates guidance on fit notes

The Department for Work and Pensions (DWP) has updated three pieces of guidance on fit notes, for patients and employees, employers and line managers, and healthcare professionals respectively. This guidance is to explain actions required if you are given a fit note by an employee. It gives advice on what different sections of the fit note mean and how you can use it most effectively to support the health and wellbeing of employees in your organisation. You can view the guidance for employers and line managers here. There is also a checklist and set of case studies to accompany it.

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Right to Work Checks: Employers are no longer required to verify a digital CoA with the ECS

The Home Office has updated its guidance for employers carrying out right to work checks on or after 17 October 2023. It removes the requirement for employers to verify a digital Certificate of Application (CoA) with the Home Office Employer Checking Service (ECS) for outstanding EU Settlement Scheme (EUSS) applications made on or after 1 July 2021. The online right to work checking service will also not direct employers to verify a digital CoA with the ECS. This requirement has also been removed from the right to rent guidance for landlords.

Data Protection: UK government approves the UK-US data bridge

From 12 October 2023, UK businesses will be able to export personal data to US entities who are certified under the UK Extension to the EU-US Data Privacy Framework (DPF), without the need to conduct a Transfer Risk Assessment, and without needing to enter into the relevant standard contractual clauses or to implement supplementary measures. While this only covers some US organisations in certain circumstances, it is nonetheless a welcome development. You can read more about this from the Information Commissioner here.

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Data Protection: An employer’s guide to understanding UK GDPR and DPA 2018

The ICO has recently updated its guidance to understanding GDPR and DPA and explains the importance of an employer’s compliance with Retained Regulation (EU) 2016/679 (UK GDPR) and the DPA 2018, particularly in the context of processing a worker’s health information. As a worker’s health data is considered particularly sensitive and is therefore provided a special level of protection under UK GDPR, the Guidance emphasises that there are specific rules an employer is obliged to follow when dealing with such data. The Guidance considers:

how an employer can use a worker’s health data fairly (in essence, providing valid justifications for gathering and using health information, ensuring transparency in the process when communicating the necessary privacy information to workers and documenting all decisions made throughout the process); and
how an employer can lawfully process a worker’s health data. In lawfully processing a worker’s health data, the Guidance specifies that a ‘lawful basis’ under Article 6 of Retained Regulation (EU) 2016/679, the UK GDPR, must be identified. It further details the additional, stricter requirements needed to process special category data under Article 9 of Retained Regulation (EU) 2016/679, the UK GDPR (which encompasses health information).

To assist employers in navigating the legal sphere surrounding the management of health data, the guidance helpfully identifies the six lawful bases for handling personal data and provides common examples for when these bases might be applicable. The six lawful bases identified are contract, legal obligations, legitimate interests, vital interests, public task and consent. However, as mentioned above, the employer must also adhere to the requirements under Article 9 and identify a special category condition for processing health data.

The guidance outlines the 10 conditions which an employer might wish to rely upon and any additional conditions required to satisfy Article 9. The typical workplace scenarios identified revolve around the lawful and good practice procedures an employer should apply when it comes to sharing a worker’s health data, administering sickness absence documentation and managing information concerning a worker’s impairment or disability. The Guidance is helpful in that it directly answers key questions an employer may have in the context of health data, such as ‘How do we handle sickness and injury records?’ and ‘What if we use medical examinations and drugs and alcohol testing?’. The Guidance clearly outlines the relevant legal requirements and provides good practice advice for each of these common questions.

To assist employers further in ensuring compliance with data protection rules in the context of a worker’s health data, the ICO has also provided several checklists which can be easily accessed by employers whenever they are required to process such information. The checklists can be found here and relate to circumstances involving genetic testing, occupational health schemes, health monitoring, sickness and injury records, and sharing a worker’s health information.

This article has been developed from an original article published by Dentons UK employment hub which can be viewed here.

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If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com

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Employment Law General Update – September 2023

Employment,
21st September 2023

Employment Law

We bring you an update of some key pieces of information affecting employment law, and potentially employers, published over the last two months to help keep you up to date.

Immigration: Number of Home Office-approved sponsor employers, by visa route, as at 13 September 2023

Economic Crime: Lords to drop Anti-Money Laundering provisions in Economic Crime and Corporate Transparency Bill

Trade Unions: TUC to report government to ILO over Strikes (Minimum Service Levels) Act 2023

Workers’ Rights: TUC launches AI taskforce to help fill legislative gap

Data Protection: ICO seeks views on first phase of draft biometric data guidance

HMRC Update: August Employer Bulletin

Immigration: Number of Home Office-approved sponsor employers, by visa route, as at 13 September 2023

The Home Office has published the number of approved employer sponsors, according to visa route, as listed on the Home Office’s register of licensed sponsors on the specified date. As at 13 September 2023, Skilled Worker sponsors account for the majority of employers (80.70%). 10.75% of sponsors have a Global Business Mobility: Senior or Specialist Worker licence, and the remaining 13 work routes account for the remaining (8.55%).

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Economic Crime: Lords to drop Anti-Money Laundering provisions in Economic Crime and Corporate Transparency Bill

Peers in the House of Lords on 11 September 2023 sought to strike a compromise with the Commons over controversial provisions in economic crime legislation by curtailing a new corporate criminal offence while also limiting the size of companies caught in its net. Peers dropped plans by unanimous consent to expand corporate criminal liability in the Economic Crime and Corporate Transparency Bill to include a new offence making it a crime for companies that fail to prevent money laundering. But members of Parliament’s upper chamber also voted 211-185 in favour of exempting only the very smallest of companies from a government offence holding companies criminally liable for failing to prevent fraud.

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Trade Unions: TUC to report government to ILO over Strikes (Minimum Service Levels) Act 2023

The Trades Union Congress (TUC) has announced that it is reporting the government to the International Labour Organization (ILO) over the Strikes (Minimum Service Levels) Act 2023. The TUC has stated that the legislation falls far below international legal standards and there are concerns that the legislation could be in breach of the UK-EU trade agreement. The ILO has already warned the government that existing and prospective legislation should be in line with ILO standards.

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Workers’ Rights: TUC launches AI taskforce to help fill legislative gap

The Trades Union Congress (TUC) has announced the launch of a new AI taskforce as part of its ‘urgent’ call for new legislation safeguarding workers’ rights. The taskforce has been launched following warnings that the UK is ‘way behind the curve’ on AI regulation, with many EU and other countries already drafting legislation specific to AI in the workplace. The taskforce will consist of leading specialists in law, technology, politics, HR and the voluntary sector with the primary purpose of filling any current legislative gaps in UK employment law around AI regulation at work. The taskforce will aim to publish an expert-drafted AI and Employment Bill in the early part of 2024.

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Data Protection: ICO seeks views on first phase of draft biometric data guidance

The Information Commissioner’s Office (ICO) has published the first phase of draft biometric and data guidance, which explains how data protection law applies when biometric data is used in biometric recognition systems. The consultation on the first phase will close on 20 October 2023, with the second phase opening for a call of evidence in 2024.

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HMRC Update: August Employer Bulletin

HMRC has published its bi-monthly magazine providing the latest information on payroll-related topics for employers and agents.

Further Information:

If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com.

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Employment Law Case Update – September 2023

Employment,
21st September 2023

Employment Law

This month we bring you a plethora of interesting cases centring around dismissal in all its forms – be they agreed, part of a restructure or initiated for a reason. The questions will always be: is that reason fair and/or have you followed the correct procedure? Have a look at our case run down here.

TUPE: Employment decision on when a TUPE transfer takes place

Redundancy: Employees in restructure did not unreasonably refuse suitable employment

Unfair Dismissal: Direct Line beats claims advisers case over agreed exit

Unfair Dismissal: Conclusion on the fairness of a dismissal must be based on the established reason for that dismissal

Vicarious Liability: School not liable for acts of work experience student

Disability Discrimination: Tribunal rules insurer discriminated against menopausal worker

Sex Discrimination: Tribunal’s misstatement of grievance outcome materially impacted on its consideration of the claim

TUPE: Employment decision on when a TUPE transfer takes place

In Rajput v Commerzbank and Société Générale [2023] EAT 116 the EAT held that (i) in a ‘series of transactions’ cases, the transfer does not necessarily take place at the end of the series, and (ii) when determining the date of the transfer, a tribunal can have regard to matters which occur outside the UK. Regulation 3(1)(a), which provides that the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006), SI 2006/246 apply to undertakings which are ‘situated immediately before the transfer in the UK’, does not mean that a tribunal must focus solely on events which take place within the UK-businesses which are situated in the UK.

Sarah Clarke, barrister at 3PB, who represented the claimant in this appeal, writes in a case analysis for Lexis Nexis that, on the face of it, the EAT’s finding that a transfer can take place at any point within the ‘series of transactions’ could cause uncertainty and increase the amount of litigation in this area. However, she goes on to say that she considers that, in the vast majority of cases, a transfer will take place at the end of the series. The question to be determined is when responsibility for the carrying on of the business transfers to the transferee and it is difficult to envisage many situations in which responsibility would transfer over prior to the end of the transactions. Indeed, as a matter of logic, if a transfer is ‘effected’ by a series of transactions, it cannot be until the last of those transactions that the transfer is complete, as otherwise the later transactions could not have ‘effected’ the transfer. However, this argument was rejected by the EAT and, in her view, there is scope for further judicial consideration of this.

In relation to the location of the business, this case makes it clear that, when determining when a transfer takes place, a tribunal’s focus ought not to be solely on those matters which occur in the UK. The relevance of geography to TUPE is simply that the business must be situated in the UK immediately before the transfer takes place. However, this does not preclude the business operating from other locations outside the UK. Thus, when dealing with this issue, parties must ensure that they provide evidence to the tribunal which clearly explains all matters relevant to the transfer, regardless as to where in the world those events took place.

The claimant was employed by Commerzbank (CB) from 2012 as a senior compliance officer. She was dismissed in March 2020 and brought various claims, including automatic unfair dismissal (on the basis that the sole or principal reason for her dismissal was the TUPE transfer) and victimisation (following a previous successful discrimination claim she had brought against CB). She had worked within the Equity Markets and Commodities Division (EMC) of the business, which was sold to Société Générale (SG), following a business purchase agreement which was signed in November 2018.

The EMC business was divided into three divisions, namely Flow Trading, Asset Management (AM) and Exotics, Vanilla and Funds (EVF), and was spread across several countries, including the UK, Luxembourg and Germany. The claimant worked across all three divisions.

For the purpose of the business sale, each division was (i) allocated its own purchase price, and (ii) divided into sub-batches, which transferred over a period of time. The EVF division transferred over in six batches from March to October 2019, with AM transferring over from May to November 2019. The last part of the EMC business to transfer over was Flow. It was based mainly in Germany, with only a small presence in London consisting of five employees. Most of Flow had transferred over by March 2020, with the remainder transferring in May 2020.

The employment tribunal found that the transfer took place on 1 October 2019 on the basis that 95% of the UK operation had transferred over by then. The judge thus ignored the last division which transferred over, as this was based predominantly in Germany.

The EAT, Mr Justice Kerr sitting alone, concluded that:

‘…there is no presumption or rule that a transfer effected by a series of transactions occurs at the end of the series. Completion may be artificially delayed. The last transaction in the series may be a minor detail, putting the last piece of the jigsaw in place long after the transferee has started running the business to the exclusion of the transferor.’

However, he agreed that the judge had erred in excluding from his consideration the Flow part of the business. The question to be determined was when responsibility for the carrying on of the business was transferred to the transferee (CELTEC v Astley). It was an agreed fact that Flow formed ‘part of the organised grouping of resources’ which comprised the EMC business. There was no reason why an ‘organised grouping of resources’ (in the words of TUPE 2006, SI 2006/246, reg 3(2)) could not be located across several countries at once. A business or part of a business can be ‘situated’ in the UK without its entire operation being located in the UK. He concluded that ‘there is nothing in the TUPE Regulations that required the tribunal to confine its consideration to the part of the organised grouping of resources based in this country.’

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Redundancy: Employees in restructure did not unreasonably refuse suitable employment

In Mid and South Essex NHS Foundation Trust v Stevenson [2023] EAT 115 the EAT had to consider whether the respondent had been entitled to refuse to make redundancy payments to the claimants where the employment tribunal had held that the alternative roles offered to them were ‘suitable’ but that their rejection of them was not unreasonable due to their personal perceptions of those roles.

The EAT held that there was no error in the employment tribunal’s approach:

— the relevant statutory test is whether the claimants ‘unreasonably’ refused an offer of employment that was suitable to them (the suitability of the role is not in and of itself determinative)

— even though the claimants’ perception of the roles was objectively groundless, the employment judge had found that there was a sufficient basis for their personal perceptions of the roles (eg that they would be a loss of autonomy and status) for them not to have acted unreasonably in refusing them

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Unfair Dismissal: Direct Line beats claims advisers case over agreed exit

Insurer Direct Line has successfully defended a case by a claims adviser that it unfairly dismissed him, with the EAT ruling that the employment tribunal had been entitled to find that there was no dismissal because the employee had mutually agreed to terminate his employment after his mental health problems meant he could not work.

In Riley v Direct Line Insurance Group plc [2023] EAT 118, the EAT ruled that an employment tribunal was entitled to find that Matthew Riley had consented to leaving his job. This is because he knew that he would receive lifetime insurance payments after being left unable to work due to mental health problems stemming from autistic spectrum disorder.

His Honour Judge (HHJ) Murray Shanks said the employment tribunal did not err when it rejected Riley’s case that he was duped into terminating his employment. ‘There was ample evidence for the conclusion reached, and the tribunal considered in detail whether Mr Riley’s consent was freely given’, he said. HHJ Shanks added that the tribunal ‘went to considerable lengths to emphasise their conclusions that Mr Riley was not tricked or coerced in any way and that he participated in the discussions, was given time and fully understood what he was doing’.

Riley was absent from work from 2014 until October 2017 due to anxiety and depression, according to the judgment. He began to make a phased return—but was again left unable to work from May 2018 because of anxiety and paranoia, the judgment says. He met with managers in August 2018 and September 2018, when he discussed leaving the job and relying on an insurance policy with UNUM that would make payments equating to 80% of his salary until he reached retirement age, according to the judgment.

Direct Line notified Riley in September 2018 that he was being dismissed following a meeting at which UNUM confirmed that he would be entitled to the benefits of the policy, the judgment says. Riley launched a case at the employment tribunal later that year, lodging claims of unfair dismissal and disability discrimination over allegations that he had been tricked by managers, according to the judgment.

But the tribunal dismissed his case in 2019, rejecting Riley’s evidence that he was put under pressure and did not understand what he was being told by managers. It also found that Riley had told managers that he knew terminating his employment to rely on the insurance policy was ‘where it’s been heading for the last four years’, according to the appeal judgment. The tribunal also concluded that Riley’s discussions with managers about his leaving had been supportive and designed to help him make the right decision.

John Platts-Mills, of Devereux Chambers, Riley’s counsel, argued before the EAT that the tribunal had failed to address the questions of who really terminated their client’s employment and whether the claims adviser really gave ‘true, mutual consent’, according to the appeal judgment.

But HHJ Shanks rejected the argument, ruling that the tribunal had ‘considered evidence relating to this in detail’. ‘It is true that they did not expressly refer to his disability in this context, but they must have had it well in mind when they rejected his evidence that he did not understand what was being said at meetings and found that he had made a fully informed decision’, he said.

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Unfair Dismissal: Conclusion on the fairness of a dismissal must be based on the established reason for that dismissal

In Greater Glasgow Health Board v Mullen [2023] EAT 122, the EAT dismissed the employer’s appeal against the decision of the employment tribunal which found that the employer’s reason for dismissing their employee was a belief by it in the existence of misconduct consisting of aggressive and threatening behaviour by him to one of his line reports. The tribunal further concluded that the employer’s belief in the existence of that misconduct was genuinely held and reached after reasonable investigation. The issue was whether the tribunal had erred in their decision.

The EAT held, among other things, that: (i) in the circumstances it was not open to the employment tribunal to base its conclusion about the fairness of the dismissal in terms of section 98(4) of the Employment Rights Act 1996 on a factual hypothesis that the ‘real reason’ for the dismissal was something different to the established reason; and (ii) on the findings in fact made by the employment tribunal, the only conclusion to which they could properly have come was that dismissal was within the range of reasonable responses open to the employer and was fair. Consequently, the employment tribunal’s judgment was set aside, and the claim of unfair dismissal was dismissed.

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Vicarious Liability: School not liable for acts of work experience student

In MXX v A Secondary School [2022] EWHC 2207 (QB) the Court of Appeal upheld the High Court’s decision that the defendant, a co-educational secondary school providing education for children aged 11 to 16, was not vicariously liable for the sexual assaults carried out by PXM on the claimant (a pupil), subsequent to PXM undertaking a work experience placement at the school. The court held that the judge had been wrong to have found that the relationship between the defendant and PXM was not akin to employment but that:

— given the limited nature of PXM’s role during the course of one week (eg he had no pastoral responsibility), the facts did not begin to satisfy the requirements of the close connection test

— the grooming which led to the sexual offending was not inextricably woven with the carrying out by PXM of his work during his week at the defendant’s school such that it would be fair and just to hold the defendant vicariously liable for the acts of PXM.

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Disability Discrimination: Tribunal rules insurer discriminated against menopausal worker

A British insurance company has been ordered to pay one of its former workers £64,645 after the tribunal found it failed to make reasonable adjustments for an employee with menopausal symptoms, who later resigned.

In Lynskey v Direct Line Insurance Services Ltd ET/1802204/2022 and ET/1802386/2022, Employment Judge Wade found that Direct Line Insurance Services Ltd did not fully consider the impact of menopause on Maxine Lynskey when it launched a warning and disciplinary process based on her performance. ‘At that time the disadvantage the claimant faced in doing her job while struggling with menopausal symptoms ought to have been recognised as such and adjustments made’, Judge Wade wrote.

The insurer must pay the sum to Lynskey to account for a range of factors, including damages for injury to feelings as well as losses she suffered, according to a remedy judgment. These events are a ‘serious and sustained number of contraventions over a period involving both the claimant’s line manager and her line managers and HR’, the tribunal found.

Lynskey was a motor sales consultant for Direct Line from April 2016. She had ‘very good’ performance ratings in that role. She then informed her manager at a meeting she was having health issues related to menopause.

‘It was clear from the information the claimant provided that she was being profoundly affected by menopausal symptoms and was seeking treatment for them; that was apparent from March 2020’, Judge Wade wrote.

Lynskey then moved to a different team considered to be a ‘better fit’ in light of her personal and health circumstances, albeit one that did not involve a sales related bonus. However, the tribunal found that with this new role, Lynskey’s managers should have been aware of health issues that would affect her performance. ‘The respondent knew, or ought reasonably to have known, from March 2020, that the claimant had become a disabled person by reason of menopausal symptoms’, Judge Wade wrote. ‘She was self-evidently at a disadvantage in comparison with colleagues without her disability in meeting the respondent’s performance standards and targets, and generally more likely to be sanctioned or face disciplinary/performance warnings.’

Lynskey began underperforming, and was told she wouldn’t receive a pay rise because her performance was rated ‘need for improvement’, the judge wrote. The tribunal ruled that it was unfavourable treatment to score her performance without fully factoring in her disability. ‘Need for improvement is inherently unfavourable if the person, through disability, cannot, in fact, improve, or meet the required standards’, it said. She later faced a warning meeting where her manager ‘failed to recognise or take in the explanations’ around her symptoms. Lynskey then faced a disciplinary meeting where her health condition was not fully considered. Judge Wade found that the subsequent disciplinary warning ‘was unfavourable treatment because of something arising in consequence of disability’.

‘It is clear a less discriminatory approach could have been taken, including occupational health referral, consideration of other roles, and accepting the claimant’s mitigation, namely her disability’, the judge wrote.

After a period of ill health and personal issues outside work, Lynskey’s sick pay was stopped, the ruling said. She then submitted a grievance to her employer before ultimately resigning in May 2022, then brought constructive unfair dismissal and Equality Act 2010 complaints against the insurance company.

The tribunal upheld Lynskey’s arguments that Direct Line failed to make reasonable adjustments for her, as well as her complaints about discrimination because of her menopause symptoms. It rejected her complaints relating to constructive unfair dismissal, sex and age.

The tribunal handed down an extempore judgment (given verbally at the end of the case, not written down) on 28 April 2023, and Direct Line requested the written reasons, which were published on 25 August 2023.

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Sex Discrimination: Tribunal’s misstatement of grievance outcome materially impacted on its consideration of the claim

In Iourin v The Chancellor, Masters and Scholars of the University of Oxford [2023] EAT 108 the EAT considered a number of appeals against an employment tribunal’s decision dismissing the claimant’s claims for direct sex discrimination, victimisation, and disability discrimination against the respondent under the Equality Act 2010.

The claimant had attempted to hug and kiss a colleague when they were in a car together. She raised a grievance and the grievance committee held that this conduct was unwanted but that, in the context of their relationship, it did not amount to harassment or sexual harassment. The claimant was however required to undergo training related to harassment, which he claimed was sex discrimination.

In finding that this did not amount to sex discrimination, the employment tribunal had made a material error of law by relying on its mistaken account of the grievance committee’s finding—stating that it was harassment but not sexual harassment—in reaching its conclusion that this was the non-discriminatory reason for the training requirement. That claim was therefore remitted to the employment tribunal for rehearing.

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If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com.

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Employment Law General Update – July 2023

Employment,
25th July 2023

Employment Law

This month there has been a lot of movement in rights at work – with a new jobs ‘passport’ for injured or disabled veterans, a private member’s bill to bring in a definition of ‘bullying’ at work, a consultation launched on the Disability Action Plan, the government’s response to the ethnicity pay reporting consultation and ACAS is consulting on a new draft Code of Practice to cover flexible working requests. There is also a consultation from the DBT on the future of the labour market enforcement strategy and ACAS’s latest annual report on how much it is needed.

Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans

Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025

Rights at Work: Parliament introduces bill to define bullying at work

Disability: DWP launches consultation on proposals for Disability Action Plan

Ethnicity Pay Reporting: Government publishes response to ethnicity pay reporting consultation

ACAS: New consultation published on new draft Code of Practice on flexible work requests

ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans

The Ministry of Defence (MoD) and Department for Work and Pensions (DWP) has announced a new Adjustment Passports scheme to help smooth the way for injured or disabled Armed Forces to re-enter civilian work life. This scheme aims to remove barriers to the labour market by providing a transferable record of workplace adjustments, removing Access to Work assessments and reassessments, thus unlocking a pool of talent for employers and businesses to assist in economy growth. Guidance for the scheme has also been published.

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Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025

The Department for Business and Trade (DBT) has published a consultation seeking responses to assist the Director of Labour Market Enforcement, Margaret Beels, in putting together the labour market enforcement strategy for 2024-25. The role of Director of Labour Market Enforcement was created in 2017 to bring together a coherent assessment of the extent of labour market exploitation, identifying routes to tackle exploitation and harnessing the strength of the three main enforcement bodies: HMRC National Minimum Wage; the Gangmasters and Labour Abuse Authority (GLAA); and the Employment Agency Standards Inspectorate (EAS).

Each year the Director submits a Labour Market Enforcement Strategy to Government to set priorities for the three main enforcement bodies.

Both the interim DLME Strategy 2022 to 2023 (published in March 2023) and the full DLME Strategy for 2023 to 2024 (awaiting clearance from government) proposed four themes as a structure for thinking about identifying and tackling labour market non-compliance. These four themes are:

Improving the radar picture to have a better understanding of the non-compliance threat.
Improving focus and effectiveness of the compliance and enforcement work of the three bodies under my remit
Better Joined-up Thinking to minimise the opportunities for exploitation of gaps in employment protection.
Improving engagement with employers and support for workers

The DLME Strategy for 2024 to 2025 will continue to build on these themes and this call for evidence seeks information about a number of these areas and provides an opportunity for respondents to draw to our attention evidence that they have of other areas where they observe significant risk of worker exploitation.

The consultation closes on 8 September 2023.

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Rights at Work: Parliament introduces bill to define bullying at work

Labour MP Rachael Maskell recently introduced a Private Members’ Bill to define workplace bullying and introduce legal duties on employers to prevent it, and it passed its first reading in Parliament on 11 July 2023.

She cited research from the Trades Union Congress in 2019 that estimated one quarter of employees are bullied at work, with most people who say they are bullied never reporting it. Maskell told the House of Commons. ‘There’s no legal definition, no legal protection, no legal route to justice, and without protection, many will leave their employer’.

If adopted, the Bill would provide a legal definition of ‘bullying’ in the workplace for the first time in the UK. Employees would be able to bring bullying claims to an employment tribunal and employers that fail to implement a statutory ‘respect at work code’ would face sanctions. The Equality and Human Rights Commission would also have powers to investigate systemic bullying damaging workplace cultures.

Maskell said the Bill would mean the definition of bullying by the workplace mediator ACAS as ‘offensive, intimidating, malicious, insulting or humiliating behaviour’ would be extended into statute and the usual method of determining compensation for injury to feelings would be applied. But its main goal is establishing a minimum standard for workplace conduct and discouraging managers who use their power over colleagues to ‘denigrate and destroy’, Maskell said.

The Bill follows bullying claims against former Justice Secretary Dominic Raab, who resigned after an investigation found he had belittled staffers. Lawyers said at the time that the lack of a legal definition of bullying made it hard but necessary to set expectations around workplace conduct.

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Disability: DWP launches consultation on proposals for Disability Action Plan

The Department for Work and Pensions (DWP) has launched a consultation on the government’s Disability Action Plan. The plan involves raising awareness of technology for disabled people, mandatory disability awareness training for taxi drivers, autism-friendly programmes for cultural and heritage sites and ensuring businesses are aware of disabled people’s needs. The plan is designed to make the UK a more inclusive society in the long term and to facilitate immediate and practical measures to improve disabled people’s lives for the better. The consultation will close on 6 October 2023.

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Ethnicity Pay Reporting: Government publishes response to ethnicity pay reporting consultation

The UK government has published a response to the ethnicity pay reporting consultation which aimed to gather views on what information should be reported, who should report it, and the next steps for consistent and transparent reporting. The government has concluded that, while ethnicity pay gap reporting can be a valuable tool to assist employers, it may not always be the most appropriate mechanism for every type of employer. Therefore, the government has confirmed that, as set out in the ‘Inclusive Britain’ report in 2022, it will not be legislating to make ethnicity pay reporting mandatory at this stage. Instead, the government has produced guidance (which was published in April 2023) to support employers who wish to report voluntarily.

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ACAS: New consultation published on new draft Code of Practice on flexible work requests

The Advisory, Conciliation and Arbitration Service (ACAS) has published a consultation on a new draft Code of Practice on handling flexible working requests. The new draft code is aimed at addressing the significant changes in ways of working since the current ACAS code was published in 2014. It is also designed to take into account anticipated changes to the Employment Rights Act 1996 around flexible working. The consultation closes at 11:59pm on 6 September 2023.

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ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

ACAS has published its annual report for 2022 to 2023, revealing a greater demand for its dispute resolution services. Key facts and figures include highlighted in this year’s report include:

ACAS’s intervention in 621 collective disputes between employers and groups of workers, a 22% increase to the previous year
105,754 notifications for early conciliation and ACAS staff finding a resolution in over 72,000 cases
over 14.4 million visits to the ACAS website
649,179 calls from employers and employees across Great Britain to the ACAS helpline

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Unfair Dismissal: Band of Reasonable responses

Parental Leave: Protection against dismissal can arise before employee gives notice to take parental leave

Whistleblowing: Employer cannot be vicariously liable for detriment caused by act of co-worker which amounts to dismissal

Discrimination: Fired ‘Color Purple’ actor loses appeal over Christian beliefs

Equal Pay: Identification of decision-maker is not essential to material factor defence

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Parental & Carer’s Leave: New Regulations come into force

Discrimination: Sexism in the City report finds ‘shocking’ levels of sexual harassment and bullying

Diversity and Gender Pay Gap: Parker Review Committee update report expands scope of targets for ethnic minority representation

Data Protection: ICO issues guidance on information sharing in a mental health emergency at work

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Discrimination & Harassment: Gender-critical professor was discriminated against for research

Whistleblowing: Job applicants are not entitled to bring claims when they have suffered detriment because of making a protected disclosure

TUPE: Liability for harassment claim does not transfer if both employees do not transfer

Anonymity: Claimant who made up sexual assault was not entitled to privacy orders

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Equality Act: EHRC issues menopause in the workplace guidance for employers

Pay: National Minimum Wage (Amendment) (No 2) Regulations 2024

Pay: 500+ companies named and shamed for not paying National Minimum Wage

Fire and Rehire: DBT publishes response to consultation on code of practice on dismissal and re-engagement

Immigration: Dates announced on Skilled Worker and Family Immigration

Immigration: Statement of Changes HC 556 stops careworkers from bringing dependants and ends Ukraine Family Scheme

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Equality Act: Unknown future claims can be waived in a settlement agreement if sufficiently particularised

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What’s in store for Employment law in early 2024?

Holiday Pay: Government publishes new guidance on pay and entitlement

Flexible Working: ACAS publishes a revised Code of Practice on requests for flexible working

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Worker Status: Supreme Court unanimously agrees that Deliveroo riders were not in an employment relationship

Termination: No ‘special circumstances exception’ when assessing resignation or dismissal

Tribunals: Tribunal’s failure to allege dishonesty amounted to a serious procedural irregularity

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Wage Updates: National Living Wage to apply to all workers aged 21+ from April 2024

Wage Updates: New benefit and pension rates published for 2024-25

Pay Disparity: TUC publishes latest data on disability pay gap

Pay Disparity: ONS publishes new report on ethnicity pay gaps in the UK

Immigration: Home Office publishes updated Code of Practice on illegal working penalties

Health at Work: Government publishes response to occupational health consultation

Health at Work: CIPD report on menstruation and support at work

What were the key findings?

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Sick Pay: Work and Pensions Committee publishes call for evidence on statutory sick pay

Retained EU Employment Law: Government response to consultation and new draft regulations available

Retained EU Employment Law consultation response

Draft Regulations

Immigration: Home Office publishes updated code of practice on illegal working penalties

Trade Unions: Government publishes guidance on issuing work notices ahead of strike action

Disability: TUC publishes latest data on disability pay gap

Immigration: WoRC report looks at systemic drivers of UK migrant worker exploitation

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Worker Status: Individual providing services through genuine partnership cannot be an employee

Constructive Unfair Dismissal: Incorrect use of hypothetical comparators

Race Discrimination: Differentiating comparators

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Sex Discrimination: ‘Deadnaming’ transgender worker amounts to less favourable treatment

Holiday Pay: Landmark case confirms a gap of three months or a correct payment does not necessarily break a series of deductions

Contract: Bonus clause conditional on staying in employment not restraint of trade

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Health at Work: DWP updates guidance on fit notes

Right to Work Checks: Employers are no longer required to verify a digital CoA with the ECS

Data Protection: UK government approves the UK-US data bridge

Data Protection: An employer’s guide to understanding UK GDPR and DPA 2018

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Immigration: Number of Home Office-approved sponsor employers, by visa route, as at 13 September 2023

Economic Crime: Lords to drop Anti-Money Laundering provisions in Economic Crime and Corporate Transparency Bill

Trade Unions: TUC to report government to ILO over Strikes (Minimum Service Levels) Act 2023