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Employment Law Newsletter – July 2020
A review of July’s employment law cases and other important news, including variousemployment-related Covid-19 updates.
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Employment Law News – February 2020
Cases:
- Contracts: Illegal performance may not prevent subsequent enforcement of contract
- Disability discrimination: Disability must have “long-term effect” at the time of discriminatory acts
- Age Discrimination: Compulsory retirement age at University not justified
- Equality Act: One-off decisions may amount to a PCP for discrimination claims
- Indirect discrimination: It is not discriminatory to pay men less for shared parental leave
- Whistleblowing: Employer not liable to surgeon who damaged his reputation by trying to set the record straight
Other news:
- National minimum wage: Government announces changes to salaried hours work and salary sacrifice schemes
- Equal Pay: Fawcett Society publishes research to support a new Bill
- Ethnic diversity: Parker Review publishes update report on ethnic diversity on boards
- Data Protection: Nominations open for Practitioner Award for Excellence in Data Protection
Contracts: Illegal performance may not prevent subsequent enforcement of contract
In the recent case of Robinson v His Highness Sheikh Khalid Bin Saqr Al Qasimi UKEAT/0106/19, the employee worked for the employer for a period of ten years under a contract which specifically provided that the employee would be responsible for paying her own income tax, but during the first seven years she failed to do so. However, once the employer became aware of the issue of non-payment of tax and took steps to address it, the employee remained employed for a further three years during which time deductions for tax and national insurance were made despite the parties being in dispute about the historical position.
The employee made various disclosures which she claimed were protected prior to her dismissal. She made claims for unfair and wrongful dismissal, and that she had suffered a detriment for making protected disclosures. The tribunal found that the reason for the dismissal was not related to the disclosures and any detriment she suffered was not materially influenced by the making of protected disclosures. Her dismissal would have been unfair but by knowingly performing her contract illegally by failing to pay income tax (as set out in the express provision in her contract that she was responsible for doing so) she was prevented from enforcing the contract and bringing any claims.
The law states that parties to an employment contract that is affected by illegality may be prevented from bringing claims in an employment tribunal or elsewhere. The effect of illegality on an employment contract will depend on the way in which the illegality arises. Where an employment contract is lawful when made but is illegally performed, the contract’s enforceability will depend on the knowledge and participation of the parties. It will be a question of fact in each case whether there has been a sufficient degree of active participation by the employee (Hall v Woolston Hall Leisure Ltd [2001] ICR 99).
On appeal at the EAT, the decision was overturned. The EAT found that the tribunal had erred in its approach to illegality. The earlier period of illegality did not prevent the employee from bringing claims for wrongful and unfair dismissal when she was dismissed at the end of that three-year period, as the prior period could be severed from the legitimately performed contractual period when she was paying the income tax. Her claims for unfair and wrongful dismissal were upheld whilst the whistleblowing claims failed at first instance on the facts.
Disability discrimination: Disability must have “long-term effect” at the time of discriminatory acts
In Tesco Stores Ltd v Tennant UKEAT/0167/19/00 the EAT has held that to claim disability discrimination, a claimant must show that their condition had a “long-term effect” at the time of the alleged acts of discrimination.
Under s.6(1) of the Equality Act 2010, a person is disabled if they (a) have a physical or mental impairment and (b) if the impairment has a substantial and long-term adverse effect on their ability to carry out normal day-to-day activities. Under paragraph 2(1) of schedule 1 of the Act, the effect of an impairment is “long-term” if it (a) has lasted for at least 12 months, (b) is likely to last at least 12 months or (c) is likely to last for the rest of the life of the person affected.
In this case, the claimant was employed by Tesco as a check out manager from June 2005. From September 2016, she was off sick for extended periods as a result of depression. She brought a claim for disability discrimination a year later (September 2017), alleging discriminatory acts which took place between September 2016 and September 2017. A preliminary hearing to determine disability took place in December 2018. The employment tribunal found that the claimant’s depression was an impairment that had had an adverse effect from 6 September 2016. Given that the claimant was still suffering from depression 12 months later, the tribunal found that the definition of disability under the Act was satisfied. However, the tribunal found no evidence on prognosis to suggest it was likely to last more than 12 months, or the rest of her life. Tesco appealed.
The EAT upheld the appeal, dismissing the claim. It held that it was necessary to determine whether the definition of disability was satisfied at the time of the discriminatory acts, not at the time the claim was submitted. The claimant could show that her condition had lasted for 12 months from 6 September 2017, but not before. Therefore, the EAT substituted a finding that the claimant was disabled from 6 September 2017. Since the relevant period was then up to 11 September 2017, this would severely limit the scope of the claimant’s claim. Therefore, the definition of “long-term” in paragraph 2(1)(a) of schedule 1 was not met in respect of acts which took place before this date.
Interestingly, permission was refused to remit the case to the tribunal to consider whether the claimant could show she was disabled at an earlier date on the basis that her condition was likely to last 12 months under paragraph 2(1)(b) of schedule 1. The EAT held that this argument had been attempted by the claimant before the tribunal, had failed, and had not been cross-appealed. Therefore, it would not be right to allow the claimant to raise the point again on remission.
Age Discrimination: Compulsory retirement age at University not justified
In Ewart v Chancellor, Master and Scholars of the University of Oxford ET/324911/2017 an employment tribunal has upheld a university professor’s claims for direct age discrimination and unfair dismissal following his compulsory retirement under the university’s Employer Justified Retirement Age policy. The university had argued that the policy was not discriminatory as it was a proportionate means of achieving a legitimate aim.
The tribunal found that there were legitimate aims for the policy, which included intergenerational fairness and career progression for junior academics; facilitating succession planning; and promoting equality and diversity (noting that recent recruits were more diverse than the existing workforce, especially the older cohort).
The tribunal went on to find that the policy was “in principle capable of contributing to the legitimate aims”. However, statistical evidence suggested that the EJRA only created 2-4% more vacancies than would otherwise have arisen, an effect that the tribunal described as “trivial in comparison with the discriminatory effect”. There was also no evidence of a system of career progression for junior academics, or expectation that they would be promoted, as senior posts were often filled externally. In relation to the diversity aim, the policy was only one of many diversity measures adopted by the university, and the evidence suggested that the university did not view it as a particularly significant measure. In conclusion, the university had not shown that having a policy made a sufficient contribution to the legitimate aims to justify its discriminatory impact. The tribunal therefore did not need to go on to consider whether the particular retirement age chosen in the policy (67) was itself appropriate.
Since the reason for dismissal was unlawfully discriminatory, the tribunal also held that it could not amount to “some other substantial reason”, meaning that the dismissal was unfair.
This decision contradicts an earlier decision in Pitcher v University of Oxford ET/3323858/2016, in which the university’s Employer Justified Retirement Age was held to be justified. It is believed the University intends to appeal this decision.
Equality Act: One-off decisions may amount to a PCP for discrimination claims
In Ishola v Transport for London [2020] EWCA Civ 112, the claimant was an employee who worked for TfL for almost eight years and was considered to be a disabled person suffering with depression and migraines. Following a period of sickness absence in May 2015, he did not return to work and was dismissed on grounds of medical incapacity in June 2016. He brought several claims, of which only one was pursued, and subsequently dismissed, but for a limited finding that there was a breach of the duty to make reasonable adjustments (in the respondent’s lateness in advising of a reduction to his sick pay and failure to allow a friend or family member to accompany him to sickness review meetings) and a corresponding finding of unlawful indirect discrimination.
The single ground of appeal raised by the claimant that the Court of Appeal considered was that the tribunal had taken too narrow and technical an approach with regard to the reasonable adjustments claim in that the respondent operated a provision, criterion or practice (‘PCP’) of requiring the claimant to return to work without concluding a proper and fair investigation into his grievances prior to his dismissal. The tribunal had held that this was not a PCP but a “one-off act in the course of dealings with one individual”.
The EAT upheld the Tribunal’s decision, concluding there had been no error of law. The Court of Appeal agreed with the EAT on the concept of a PCP: that although a one-off decision or act can be a PCP, it is not necessarily one.
Indirect discrimination: It is not discriminatory to pay men less for shared parental leave
In May last year we reported on the two cases of Hextall v Chief Constable of Leicestershire Police and Ali v Capita Customer Management 2019 EWCA Civ 900. The matter had been appealed to the Supreme Court but permission to appeal has now been refused, meaning the Court of Appeal’s decision is upheld.
The Court of Appeal held that it is not sex discrimination for employers to enhance pay for women on maternity leave, but offer only the statutory rate for both men and women on shared parental leave.
There were three issues: direct sex discrimination, indirect sex discrimination and sex equality clauses. The two cases were sufficiently similar to be heard at the same time. They involved male employees, fathers, wanting to take Shared Parental Leave (“SPL”). Broadly speaking, they argued that it was sex discrimination that men on SPL were not paid the same rate as women who received enhanced maternity pay. Weekly statutory rates for Shared Parental Pay and Statutory Maternity Pay (“SMP”) are the same but some employers pay above the SMP rate (enhanced maternity pay) and there is no statutory requirement for employers to matched enhanced maternity pay for men and women who are on SPL. The question then was whether this was direct or indirect sex discrimination.
The Court of Appeal reached the following conclusions, which are now precedent:
- The correct comparator for a man on SPL is a woman on SPL, rather than a mother who had just given birth because the predominant purpose of the minimum 14 weeks leave required by the Pregnant Workers Directive is not just childcare but other matters exclusive to the birth mother resulting from pregnancy and childbirth which are not shared by her husband or partner. Therefore there could be no direct discrimination because the man could not be treated less favourably.
- There was no “particular disadvantage” to which men were put. Women on maternity leave are materially different, for the reason given above, and so men on parental leave and women on maternity leave are not in comparable positions for the purposes of Equality Act 2010.
- Even if Mr Hextall’s claim had fallen within the sexual equality clause section of the Equality Act 2010 (indirect sex discrimination based on an equal pay claim) it could not succeed because of the specific exclusion in the Act which states that “A man cannot make a claim based on more favourable terms enjoyed by a woman as a result of pregnancy or childbirth”. This exclusion prevented him from relying on the sexual equality clause because the more favourable term (enhanced maternity pay) was in connection with pregnancy or childbirth, rather than just childcare following the birth of a child.
Whistleblowing: Employer not liable to surgeon who damaged his reputation by trying to set the record straight
In Jesudason v Alder Hey Children’s NHS Foundation Trust [2020] EWCA Civ 73 the Court of Appeal has upheld an employment tribunal’s decision to reject a whistleblowing detriment claim by an employee (Mr Jesudason, a consultant paediatric surgeon) who had raised concerns with various parties, including the media, about malpractice at the Department of Paediatric Surgery at Alder Hey Children’s Hospital. In responding to the media furore, the employer had falsely stated that the employee’s complaints were completely without foundation, and had failed to acknowledge that an independent report had made recommendations for improvements which the employer had acted upon.
The court held that, although the employee had made protected disclosures and had suffered a detriment to his reputation, the detriment did not arise from the protected disclosures. The employer had been motivated by an intention to minimise the harm from adverse, and in part misleading, information which the claimant had chosen to put in the public domain.
Other News:
National minimum wage: Government announces changes to salaried hours work and salary sacrifice schemes
The government has responded to a consultation launched in December 2018 on whether certain aspects of the national minimum wage (NMW) legislation should be amended to ensure that they do not inadvertently penalise employers.
Having considered over 100 responses to the consultation, the government has announced that it will amend the NMW legislation to relax the current rules relating to “salaried hours work”. This will allow employers to pay salaried hours workers on different payment cycles, to choose a calculation year for their workers, and to make premium payments to salaried hours workers. These changes are intended to come into force on 6 April 2020.
Although the government has decided not to amend the NMW legislation in relation to salary sacrifice schemes, several measures have been announced to help employers understand the rules and drive compliance. These include improving the available guidance, waiving certain financial penalties for breach of the salary sacrifice rules, a resumption of the NMW Naming Scheme (subject to a higher arrears threshold), providing pro-active support for new, small businesses, and giving employers access to help directly from HMRC (via a telephone helpline and online).
Equal Pay: Fawcett Society publishes research to support a new Bill
The Fawcett Society (a campaigning women’s rights charity) has published research to accompany the launch of the Equal Pay Bill 2019-20, which was introduced as a private members’ bill in the House of Lords by Baroness Prosser on 28 January 2020. The Bill was developed by a Fawcett Society working committee made up of equal pay and human resources experts, within input from the EHRC.
The research revealed that:
- a staggering 40% of people do not know that women have a right to equal pay for work of equal value;
- only 36% of people know that women have a legal right to ask male colleagues about their salary if they believe they may be the victim of pay discrimination; and
- in most workplaces, people do not talk openly about what they earn – with only 24% reporting that salaries are discussed openly in their workplace.
Among other things, the Bill aims to give women who suspect they may be suffering pay discrimination a statutory right to know what a male comparator is being paid. It would extend pay gap reporting to employers with 100 or more employees (rather than 250 as at present) and would widen the scope of pay gap reporting beyond gender, to include the pay gap between employees of different ethnic groups. This is something on which the government has consulted but not yet legislated.
Ethnic diversity: Parker Review publishes update report on ethnic diversity on boards
On 5 February 2020, the Parker Review Committee published an update report, the first following its final report into the ethnic diversity of UK boards in October 2017. The new report includes detailed data both on the current profile of FTSE 350 boards and on ethnic diversity reporting (the latter commissioned by the Financial Reporting Council (FRC) from Cranfield School of Management).
The original Parker report recommended (among other things) that there should be at least one director of colour on each FTSE 100 board by 2021 and on each FTSE 250 board by 2024. The update report suggests that, while companies are not yet up to speed, there has been movement and it might still be possible to meet the targets.
The data on ethnic diversity reporting is described by the FRC in a separate press release as unsatisfactory. Among the headline findings are that:
- Over half of FTSE 250 companies (52%) fail to mention ethnicity in their board diversity policy.
- Most of the FTSE 350 do not set measurable ethnicity targets.
- Only 14% of FTSE 100 companies set measurable objectives for board ethnic diversity. For FTSE 250 companies the figure is 2%. Even where objectives have been set, no FTSE 350 companies report progress against them.
The FRC will be closely monitoring how companies report on their policies or explain their lack of progress in this area. It expects to see improvements.
The update report includes:
- Company success stories, illustrating good practices that may make it easier to meet the Parker Review targets.
- Success profiles (of individual directors).
- A Directors’ Resource Toolkit developed by Ernst & Young (principal sponsor to the Parker Review report) to assist companies and those responsible for recruitment.
Data Protection: Nominations open for Practitioner Award for Excellence in Data Protection
Those businesses that process a lot of data may be interested to know that the ICO has just opened its nominations for the third annual Practitioner Award for Excellence in Data Protection. They are looking for individuals who have shown an outstanding impact in relation to accountability or inspiring public trust and confidence in how personal data is processed. An award such as this could be a very useful addition to a business’s marketing strategy and integrity, showing a strong commitment to the individuals they serve.
Individuals can nominate themselves or nominations can be made by a colleague, and the winner will be announced at the ICO Data Protection Practitioners’ Conference in Manchester on 6 April 2020.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
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Employment Law Newsletter – January 2020
We give you a round up of some of the big issues of 2019 in employment law, and what to expect in 2020, including a brief look at what’s likely to be covered by the Employment Bill 2020 and what happens next when the UK leaves the EU.
What were the big issues in 2019?
Equality, sexual harassment and discrimination
Looking back over the course of 2019, in amongst the omnipresent Brexit headlines (we got a new prime minister and a Brexit date was finally agreed, let’s just leave that there for now), several linked issues kept arising. The #MeToo movement has put a spot light on the treatment of women in the workplace and so it is not surprising that the topics of equality, sexual harassment and sexual discrimination should have continued to surface. In June, The Women and Equalities Committee published a report on ‘The use of non-disclosure agreements in discrimination cases’ tackling the perceived ‘cover up’ culture, which was followed by the Law Society publishing NDA guidance summarising both the things employers cannot stop workers from doing and explaining the restrictions commonly imposed on workers prior to signing the NDA. The government responded that it would review this as well as opening a consultation to address sexual harassment in the workplace.
The government also produced ‘Gender equality at every stage: a roadmap for change’. The plan is to financially empower women from school to retirement, by including measures such as improved information for parents around family friendly entitlements. This seems much needed after UNICEF published a report last year showing the UK is one of worst countries in Europe for paid parental leave, and yet figures gathered by the ONS show the number of mothers in the workforce is up by 75%. The Gender Roadmap also includes a consultation on strengthening measures to tackle sexual harassment, and a review of the enforcement of the equal pay legislation and the effectiveness of the gender pay gap reporting system. In fact, the gender pay gap figures from 2019 (for 2018) show a widening gap in favour of men. Perhaps naming and shaming is simply not enough, who would have guessed that?
Meanwhile ACAS produced guidance for employers on the sensitive handling of menopause symptoms whilst at work. The government also backed a ‘Lead the Change’ board which was set up to encourage business leaders to promote diversity and inclusion – it is an independent review board to ensure that talented women at the top of business are recognised, promoted and rewarded.
Mental Health and Stress
Quite rightly, mental health and stress are key areas that are really starting to occupy people’s focus, after all, an unhealthy workforce leads to sickness, absence, low morale, and inefficiency. In July, the government launched a consultation entitled ‘Health is everyone’s business: proposals for reducing ill health-related job loss.’ There were various reports published in 2019 looking at mental health: the CIPD reported on the increasing number of stress-related absences from work; Nuffield reported on the impact of flexible working and working from home on workers’ health and how it should be carefully managed; and a TUC report that showed that Britons have some of the longest working hours in Europe.
Modern working practices
In the gig economy and with more focus on mental health and family life, the way we work is changing rapidly, with the CV-Library reporting last year that the number of remote workers has doubled in the last 4 years, which is challenging the government to keep pace. In 2018, the Supreme Court finally ruled the Pimlico plumbers were workers rather than independent contractors. Having received that decision, one of them made a claim to the tribunal for holiday pay, only to be told it was out of time, however given he didn’t know at the time he was entitled to it, he will likely be appealing this decision. After a number of holiday pay dispute cases in recent years, BEIS published online guidance and a calculator to help calculate holiday pay for workers whose hours or pay are not fixed. Meanwhile, the government seems to be trying to clamp down on the tax aspects of flexible working arrangements by announcing changes to the so-called ‘IR35 rules’ (those which affect the private sector are due in April 2020) concerning those individuals who provide services to clients via a service company. Whilst this may indeed lead to an increase in income tax and National Insurance payments for the government, it may simply lead to more inventive ways to get around the tax rules, whilst the tribunals and courts are left to battle it out over the true meaning of what constitutes a worker, an employee or an independent contractor.
What should we expect in 2020?
Employment Bill 2019-20
This is expected to apply in the main to England, Wales and Scotland and include the following measures:
- A single enforcement body for the labour market. As recommended by the Good Work Plan, a single enforcement agency to be set up dealing with non-compliance in the labour market, to replace the enforcement functions of the Employment Agency Standards Inspectorate (EASI), the Gangmasters and Labour Abuse Authority (GLAA), HM Revenue and Customs (HMRC) and the Health and Safety Executive (HSE). A consultation on these proposals closed on 6 October 2019; a response is awaited.
- Protecting tips and service charges for workers. Employers to be required to pass on all tips and service charges to workers and, supported by a statutory Code of Practice, to ensure that tips would be distributed on a fair and transparent basis.
- The right to request a more predictable contract. The government previously indicated its intention to legislate to introduce a right for all workers to request a more predictable and stable contract after 26 weeks’ service as part of the Good Work.
- Extending redundancy protection to prevent pregnancy and maternity discrimination. The Pregnancy and Maternity (Redundancy Protection) Bill 2017-19 was not granted Royal Assent in the 2017-19 Parliamentary session. The Bill was designed to extend the existing redundancy protection, effectively making it harder to make employees redundant during pregnancy and afterwards, until six months after they have returned from maternity leave. The Bill was believed to have cross-party support and the government is now intending to implement this measure through the Employment Bill.
- Extended leave for neonatal care. The government’s consultation on a new right to neonatal leave and pay, to support parents of premature or sick babies, closed on 11 October 2019; a response is awaited.
- A week’s leave for unpaid carers. This proposal was made in the Conservative Party’s election manifesto.
- Making flexible working the default. As set out in the Conservative Party’s election manifesto, the government intends, subject to consultation, to make flexible working the default position unless an employer has a good reason.
- Brexit-related provisions. The Employment Bill may contain provisions designed to safeguard workers’ rights derived from European legislation, after similar provisions were removed from the European Union (Withdrawal Agreement) Act 2020.
The Good Work Plan
A number of changes set out in the government’s Good Work Plan, published in December 2018, will come into effect on 6 April 2020:
- The right to a written statement of terms for all workers (not just employees) on or before the first day of employment.
- Additional information will need to be included in written statements of terms for employees and workers, including information on the length of time a job is expected to last, the notice period, eligibility for sick leave and pay, other rights to leave, any probationary period, all pay and benefits, and specific days and times of work.
- The removal of the “Swedish derogation” in the Agency Workers Regulations 2010, which allows employment businesses to avoid pay parity between agency workers and comparable direct employees where the agency workers receive pay between assignments.
- The introduction of a Key Information document for agency work-seekers, including information on the type of contract, the minimum expected rate of pay, how they will be paid and by whom.
- The threshold to request workplace information and consultation arrangements under the Information and Consultation of Employees Regulations 2004 (SI 2004/3426) will be lowered from 10% to 2% of employees, subject to the existing minimum of 15 employees.
- The increase of the reference period for determining an average week’s pay (for the purposes of calculating holiday pay) from 12 weeks to 52 weeks.
The Conservatives’ manifesto did not mention resolving the complex issue of employment status and there has not yet been any response to the 2018 consultation on this, suggesting that it is not a high priority for the current government.
Off-payroll working rules
In order to address non-compliance with IR35 in the private sector, the government confirmed at the Autumn 2018 Budget that the off-payroll working rules would be extended to the private sector from 6 April 2020, but that small entities would be excluded from the scope of the new rules. This means that payments to workers supplied to large and medium-sized companies by personal service companies will be treated as payments of employment income and so subject to income tax and NICs. This shifts responsibility for tax compliance from the personal service company to the client or intermediary. However, as the legislation has not yet been passed, this measure remains subject to any further changes. During the election campaign, Sajid Javid, the Chancellor of the Exchequer, spoke about wanting to ensure that the proposed changes to off-payroll working were “right to take forward”. Some have suggested that there could therefore be a delay in implementation.
Taxation of termination payments
From 6 April 2020 all termination payments above £30,000 will be subject to employer’s NICs. This measure is implemented in the National Insurance Contributions (Termination Awards and Sporting Testimonials) Act 2019 which received Royal Assent on 24 July 2019.
Parental bereavement (leave and pay)
The Parental Bereavement (Leave and Pay) Act 2018, which entitles all working parents to two weeks’ paid statutory leave if they lose a child under the age of 18 (including a still birth after 24 weeks of pregnancy), is expected to finally come into force in April 2020, after a long wait. Secondary legislation is also awaited to implement the details of the scheme.
Non-disclosure agreements
In July 2019, the government published its proposals to prevent the misuse of confidentiality clauses or non-disclosure agreements (NDAs) in the settlement of workplace harassment or discrimination complaints. The government reiterated that confidentiality clauses can serve a legitimate purpose in both employment contracts and settlement agreements but confirmed its intention to bring forward new legislation “when Parliamentary time allows”.
The government has also stated that new requirements will be introduced for the limitations of a confidentiality clause to be clear to those signing them, as well as for mandatory independent legal advice on a settlement agreement to include the limitations of any confidentiality clause. Clauses that do not follow these new rules will be void.
Sexual harassment
In July 2019, the government launched a consultation on measures to address sexual harassment in the workplace. The consultation includes proposals such as introducing a mandatory duty on employers to prevent harassment in the workplace and increasing the time limit for bringing a discrimination claim from three to six months. The Equality and Human Rights Commission (EHRC) statutory code of practice on preventing sexual harassment in the workplace is also awaited and may well be published in 2020.
Ethnicity pay reporting
In 2018, the government launched a series of measures to tackle barriers facing ethnic minorities in the workplace, including a consultation on the introduction of mandatory ethnicity pay reporting, based on the model of mandatory gender pay gap reporting. A response to this consultation is still awaited and as there was no mention of this measure in the recent Queen’s Speech, it may be that this is no longer a priority for the current government. It is notable that the Conservative Party’s recent manifesto included a pledge to further investigate pay disparity in the UK, yet this manifesto did not refer to the possibility of introducing mandatory ethnic pay reporting.
Pay
The Conservative Party pledged in its manifesto to increase the National Living Wage (NLW) to two-thirds of average earnings (£10.50 an hour) by 2024 and to extend the NLW to over-21s.
Key cases:
On 12 and 13 February 2020 the Supreme Court will hear the appeal in Royal Mencap Society v Tomlinson-Blake, considering whether the correct approach to determine whether employees, who sleep-in in order to carry out duties if required, engage in “time work” for the full duration of the night shift, determining if they are therefore only entitled to the national minimum wage when awake for the purposes of working.
On 22 and 23 July 2020 the Supreme Court will hear the appeal in Uber BV and others v Aslam and others. The court will decide whether to uphold the Court of Appeal’s majority finding that Uber drivers are workers for the purposes of the Employment Rights Act 1996, the National Minimum Wage Act 1998 and the Working Time Regulations 1998.
We are currently awaiting the judgment in Various claimants v Wm Morrisons Supermarket which was heard in the Supreme Court on 6 and 7 November 2019. The court considered the High Court’s ruling that Morrisons are vicariously liable for a data leak by one of their employees. The breach resulted in around 5000 staff members having their personal data stolen and shared with the public.
A hearing date for the Supreme Court hearing of Ali v Capita Customer Management Ltd; Hextall v Chief Constable of Leicestershire Police is currently awaited. The court will consider whether it was direct or indirect sex discrimination, or a breach of the equal pay sex equality clause, for two employers to fail to pay two male employees enhanced shared parental pay.
The hearing date for another Supreme Court hearing, Asda v Brierley, is also awaited. The court will decide whether workers in retail stores were employed under comparable terms and conditions to those working in separate distribution depots for the purposes of equal pay claims under the Equality Act 2010 and the Equal Pay Act 1970.
BREXIT:
This will come as no surprise to you, but, yes, we are expecting the UK to leave the European Union at 11.00 pm (UK time) on 31 January 2020. Whilst we cannot be sure what the long-term impact of Brexit on employment law will be, there are unlikely to be any significant changes happening in 2020. The UK will be in a post-Brexit transition period and most EU law (including as amended or supplemented) will continue to apply to the UK.
The European Union (Withdrawal Agreement) Act 2020 was recently given royal assent, implementing the withdrawal agreement into UK law. Under the withdrawal agreement, a post-Brexit transition period will run from exit day until 31 December 2020, during which time the UK will be treated for most purposes as if it were still an EU member state, and most EU law (including as amended or supplemented) will continue to apply to the UK. The transition period could be extended for up to one or two years, but only if the joint UK-EU committee agrees to an extension before 11.00 pm (UK time) on 30 June 2020. The Act includes a provision that prohibits the UK government from agreeing in the joint committee to an extension.
In the unlikely event that the UK and the EU do not conclude a withdrawal agreement by exit day (and there is no further extension of the Article 50 period, and the Article 50 withdrawal notice is not revoked), the UK will leave the EU on exit day with no agreement to govern the terms of withdrawal, and no transition period.
Once the UK leaves the EU, with or without a deal, formal negotiations on the future UK-EU relationship can start under Article 218 of the Treaty on the Functioning of the European Union. (Trade agreements are also governed by Article 207.) Assuming the UK and the EU agree a political declaration before withdrawal (in tandem with the withdrawal agreement), this declaration will form the basis for their post-Brexit negotiations on the future relationship. If the UK leaves the EU with a withdrawal agreement and transition period, the future relationship would ideally come into effect at the end of the transition period to minimise disruption, as many aspects of a no-deal scenario would again arise if relevant future relationship agreements are not in force by the end of the transition period.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
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Employment Law Newsletter – December 2019
Cases:
- Sex discrimination: Direct discrimination not to pay a ‘London Allowance’ to police officer on maternity leave
- Worker status: A substitution clause in a service contract may not automatically preclude ‘worker’ status
- Unfair dismissal: Was it caused by hidden reason (whistle-blowing) or invented reason (capability)?
- Unfair Dismissal: Automatically unfair if hidden reason is trade union activities
- TUPE: Protection could extend to workers, not just employees
Other news:
- ICO: Find out if you need to pay the data protection fee
- ONS: Pay gap for disabled workers is 12.2%
- Modern Slavery: 75% of global hotel companies in UK failing to meet minimum requirements
Cases:
Sex discrimination: Direct discrimination not to pay a ‘London Allowance’ to police officer on maternity leave
In City of London Police v Geldart UKEAT/0032/19/RN the EAT found in favour of a female claimant who was entitled to a ‘London Allowance’ payable to serving police officers in both the City of London and Metropolitan Police forces (pursuant to Part 6 of the Police Regulations 2003). This is a non-pensionable payment which is distinct from salary and ‘London Weighting’. The Police force had stopped paying her London Allowance when her maternity pay ceased during maternity leave.
Both the tribunal and the EAT found that there was nothing in the Police Regulations which meant the London Allowance should stop being payable during maternity leave, and cited the example that the allowance was also payable when an officer was suspended from duty. It was distinguished from certain allowances to cover expenses incurred when performing duties which were capable of being stopped. Failing to pay the London Allowance during maternity leave was therefore an act of direct sex discrimination contrary to section 39(2) of the Equality Act 2010.
In this matter, the claimant did not have to show that the Police force would have treated a male officer more favourably (i.e. used a comparator) because she was treated unfavourably on the ground of her pregnancy or maternity. As a result, she was the victim of sex discrimination and does not need to, and indeed cannot, prove that a man would have been treated differently (as set out in Webb v EMO Air Cargo (UK) Ltd [1994] ICR 770).
Worker status: A substitution clause in a service contract may not automatically preclude ‘worker’ status
In Stuart Delivery Ltd v Augustine UKEAT/0219/18/BA Mr Augustine was a delivery courier working for Stuart Delivery in fixed hours ‘slots’ (typically around 3 hours). During the slot Mr Augustine was under the control of Stuart Delivery, he was not able to leave the zone he had agreed to operate in and was required to undertake the deliveries offered to him in return for a guaranteed hourly wage. He could not hold himself out as available to other delivery companies during the period of a slot. Mr Augustine could release a slot he had signed up to back into the pool of approved couriers via Stuart Delivery’s Staffomatic app.
The tribunal, and the EAT, found that the use of the Staffomatic app to release a slot, and therefore extricate himself from work, was not of the character of a substitution clause which would deny him ‘worker’ status. The EAT held that the tribunal had correctly found that Mr Augustine would only be released from the obligation of performing the slot himself if another courier signed up for it. Therefore, he had no control over whether, or who, picked up the slot he had released. This did not amount to a ‘right’ of substitution, or a provision that was inconsistent with limb (b) worker status (as set out in s.230(3)(b) ERA1996).
Unfair dismissal: Was it caused by hidden reason (whistle-blowing) or invented reason (capability)?
The case of Royal Mail Group v Jhuti [2019] UKSC 55 has been progressing for some time (we reported the decision of the EAT in July 2016, and the Court of Appeal in October 2017) and it has now been considered by the Supreme Court.
The facts are that having made a protected disclosure (whistleblowing) to her line manager, Ms Jhuti was dismissed due to capability (he had retaliated by scrutinizing her performance) following deliberate misleading of the investigating manager by the same line manager because of the disclosure. Ms Jhuti claimed unfair dismissal, which was rejected by the tribunal but on appeal, the EAT found in favour of the claimant on the basis that just because the HR department was ignorant of the full facts (the investigating manager didn’t know about the whistleblowing, so couldn’t have been motivated by it), the original line manager who had had the full facts had manipulated the decision by engineering the dismissal with the whistleblowing in mind. Given his position, that responsibility fell on the employer, and therefore she had been unfairly dismissed, even though the person with actual decision-making responsibility had been unaware of it.
The Court of Appeal reversed this decision but the Supreme Court agreed with the EAT, stating that “if a person in the hierarchy of responsibility above the employee determines that she (or he) should be dismissed for a reason but hides it behind an invented reason which the decision-maker adopts, the reason for the dismissal is the hidden reason rather than the invented reason.”
Unfair Dismissal: Automatically unfair if hidden reason is trade union activities
In Cadent Gas Limited v Singh [2019] UKEAT 0024_19_0810 Mr Singh was a gas engineer with 29 years’ service and an unblemished record. He was also a health and safety representative and trade union shop steward. He was required to respond to priority gas leaks without delay. One day, he was called out to a gas leak at 1.13am. He accepted the job despite having not slept or eaten much all day. Without informing dispatch he stopped for some food on the way to the call out, arriving at the premises 1 minute outside the hour stipulated in the service level agreement.
Mr Singh had previously had problems with Mr Huckerby, a senior manager, in relation to his trade union activities. Mr Huckerby noted that Mr Singh had been late, then played a leading role in the investigation, although this was not the norm, and told others that he wanted to keep the trade union activities “on the radar”. He also gave incorrect information to HR and to the dismissing officer in the course of the investigation. The disciplinary hearing was conducted by another manager, who had not had any prior involvement. He decided to dismiss Mr Singh for gross misconduct. Mr Singh claimed unfair dismissal on the ground of his trade union activities contrary to s.152 of the Trade Union and Labour Relations (Consolidation) Act 1992.
The Tribunal upheld his claim, concluding that the managers who conducted the disciplinary hearing and appeal were not motivated by prejudice against Mr Singh for his trade union activities, although Mr Huckerby was. The employer appealed but the EAT dismissed the appeal, holding that the investigation was inadequate and the dismissal automatically unfair. On the basis that even though the other managers were not motivated by prejudice, it did not preclude a finding that trade union activities played a part in their reasoning, following the decision in Royal Mail Group v Jhuti (see previous case review above) whereby the motivation and knowledge of someone who is not a decision-maker may be attributed to the employer if (as here) that person is engaged in and had manipulated the investigatory process.
TUPE: Protection could extend to workers, not just employees
Under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), the definition of employee is given as “an individual who works for another person whether under a contract of service or apprenticeship or otherwise”. In the case of Dewhurst v Revisecatch Ltd t/a Ecourier [2019] UKET 2201909/2018, Judge Joffe has interpreted the ‘or otherwise’ part to include workers, citing the Acquired Rights Directive which states that TUPE should be interpreted liberally.
Workers affected by a TUPE transfer have the right to be informed about and consulted on it, under the regulations, and failure to do so can result in compensation of up to 13 weeks’ pay per person. Transferor employers have to include details of the workers on the Employee Liability Information. Currently, only traditional employees benefit from the provisions on automatic unfair dismissal as a consequence of a TUPE transfer. However, whilst this is first instance case, and therefore not currently binding, it is likely to be appealed and could therefore impact future decisions if this interpretation is upheld. Employers are therefore warned to be alert to this case and if involved in a TUPE transfer may consider including any workers in order to minimise risk or may wish to seek additional indemnities from other parties to a transaction to deal with this potential risk.
Other News:
ICO: Find out if you need to pay the data protection fee
The Information Commissioner has recently announced that it is contacting all UK registered companies reminding them of their legal responsibility to pay a data protection fee. Organisations processing personal information are required to pay a data protection fee unless they are exempt. Check their website (link above) to see if you need to pay or if you are exempt, and how you can contact them to pay or complete their exemption form.
ONS: Pay gap for disabled workers is 12.2%
The Office for National Statistics (ONS) recently published a report entitled ‘Disability pay gaps in the UK: 2018’. Using data from 2018, the report presents the first analysis of disability pay gaps in the UK using newly reweighted earnings data from the Annual Population Survey. The main points are these:
- Median pay was consistently higher for non-disabled employees than for disabled employees; median pay for non-disabled employees was £12.11 an hour whilst for disabled employees it was £10.63 an hour, resulting in a pay gap of 12.2%.
- The disability pay gap was wider for men than for women.
- London had the widest disability pay gap at 15.3% and the narrowest pay gap was in Scotland, at 8.3%.
- Disabled employees with a mental impairment had the largest pay gap at 18.6%, while for those with a physical impairment the pay gap was 9.7% and those with other impairments had the narrowest gap, at 7.4%.
- Around a quarter of the difference in mean pay can be accounted for by factors such as occupation and qualification.
Modern Slavery: 75% of global hotel companies in UK failing to meet minimum requirements
In a shocking report produced by a collaborative partnership of philanthropic organisations and campaigners, a study of 71 global hotel companies in the UK shows that four years after the introduction of the Act, only 18 have met the minimum requirements of the UK Modern Slavery Act 2015. These requirements include publishing a modern slavery statement which should include information on the following:
- disclose their structure, business and supply chains providing information about risks in supply chains and in direct operations,
- having policies in relation to slavery and human trafficking,
- due diligence processes undertaken, assessing actual and potential human rights impacts,
- risk assessment and management.
Whilst this report highlights the problems with enforcement by the government, another issue in such a high-risk sector, is the threshold of a £36m annual turnover set by the Act, which means that most hotels in the UK are not even subject to the law. With such a vulnerable workforce, the report has made a number of recommendations. One of which is the creation of a monitoring body to survey corporate compliance with the Act.
Further information on Modern Slavery can be found on the government website: https://www.gov.uk/government/collections/modern-slavery.
Further Information
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com
-
Employment Law Newsletter – November 2019
Cases:
- Withholding Wages: Employer cannot rely on Home Office negative right to work check notice
- Redundancy: Trial period and dismissal
- Privacy: Does covert monitoring of employees suspected of theft amount to a breach of privacy?
- Contracts: Is £500+VAT enough for an employee to take full advice on a settlement agreement?
- Whistleblowing: Public interest test is subjective so claimant must be given opportunity to give evidence
Other news:
- Data Protection: ICO publishes new detailed guidance for Data Protection Officers
- Gender Balance: Hampton-Alexander Review’s fourth annual report published
- Workplace Diversity: ONS figures reveal number of mothers in the workforce reaches a record 75%
- Mental Health: Nuffield publishes whitepaper on effects of remote working on stress, wellbeing and productivity
- National Minimum Wage: Rates for April 2020 delayed by general election
- Tribunals & Courts: Closures over Christmas and New Year 2019
Withholding Wages: Employer cannot rely on Home Office negative right to work check notice
In a decision that will make every employer roll their eyes, the EAT has recently decided that receiving a negative verification notice from the Home Office in response to an Employer Checking Service (ECS) right to work check request was not sufficient to allow an employer to withhold pay from an employee.
In the case of Badara v Pulse Healthcare Limited UKEAT/0210/18 the employer held an honest but mistaken belief that a non-EEA national (Nigerian) had to provide documentary evidence of their right to work, and this was a clause written into their contracts. Mr Badara was, in fact, entitled to an automatic right to work as a result of being a family member of an EEA national – the strict legal position irrespective of documentary evidence. Given this, when the employer requested an ECS from the Home Office, it should have provided a positive result, but for some reason came back negative. The employer therefore refused to provide Mr Badara with work and wages for fear of breaching the Immigration Asylum and Nationality Act 2006. The tribunal concluded that it was not unreasonable in the circumstances for the employer to rely on the ECS checks. However, the EAT disagreed because had the tribunal applied the ‘Additional Information’ section of the Right to Work guidance from the Home Office and the appropriate case law (Okuoimose v City Facilities Management Ltd UK EAT 2011) then it would have followed that the right to work would have been established, although the guidance states that a statutory excuse might not be established. The act of dismissal was prima facie indirectly discriminatory. The tribunal’s decision that the dismissal was justified could not stand and the employee’s claims for unlawful deduction from wages and indirect race discrimination were remitted to the tribunal for reconsideration.
A note for employers: despite the threat of the penalty provisions in the Immigration Asylum and Nationality Act 2006, Home Office guidance (and case law) states that an ECS check is not always enough to determine eligibility to work. If in any doubt, read all the guidance and seek professional advice.
Redundancy: Trial period and dismissal
In a redundancy situation, s.138 of the Employment Rights Act states that an employee is entitled to an automatic four week ‘statutory’ trial period in an alternative position if they have been dismissed as a result of redundancy, they accept an alternative role before the old one comes to an end, the new contract begins either immediately after the old role, or within 4 calendar weeks of the end of the old role, and the terms of the new contract differ from the original contract. This means that if there is no dismissal (or notice of dismissal) from the old role, then there can have been no statutory trial period.
In the case of East London NHS Foundation Trust v O’Connor [2019] UKEAT 0113_19_2910, Mr O’Connor was told in March 2017 that due to a reorganisation, his role of Psycho-Social Intervention Worker was going to be ‘deleted’ with effect from 3 July 2017, putting him at risk of redundancy. He was offered an alternative role on a trial basis as Care Coordinator, starting from 3 July 2017. There was a disagreement as to whether this was suitable alternative employment, following which Mr O’Connor pursued a grievance. When that proved unsuccessful, the employer re-offered him the Care Coordinator position, which he declined. Mr O’Connor was dismissed in December 2017.
Mr O’Connor claimed he was owed a redundancy payment but the employer refused. It argued that the statutory trial period had ended on 9 August 2017 and the Care Coordinator role was a suitable alternative employment which Mr O’Connor had unreasonably refused. Thus, he was not entitled to a redundancy payment.
The EAT upheld the tribunal’s finding that Mr O’Connor had not actually been dismissed in July, and that the deletion of his role did not, in fact, amount to notice of dismissal – there being no rule of law which said so. The tribunal found that it was a matter of considering all the facts and circumstances to establish what happened. In this case, the evidence pointed to Mr O’Connor having started a trial in July without having been dismissed, which happened in December. The result was that this matter was remitted to the tribunal to consider the question of whether it was in fact dismissal by way of redundancy and therefore what payment may be due.
Privacy: Does covert monitoring of employees suspected of theft amount to a breach of privacy?
The European Court of Human Rights recently handed down its decision in López Ribalda and others v Spain. The matter concerned a supermarket where the manager noticed some inconsistencies between the stock level and the sales figures, running into thousands of Euros over a number of months. The manager launched an internal investigation and installed CCTV cameras, some visible and other hidden. The visible cameras were directed towards the entrances and exits of the supermarket. The hidden cameras were placed at a certain height and directed towards the checkout counters. The employees were told that the manager suspected theft and about the installation of the visible cameras, but not the hidden ones. Prior to this, the company had notified the Spanish Data Protection Agency that it intended to install CCTV cameras in its shops. The Agency had pointed out the obligations to provide information under the legislation on personal data protection. A sign indicating the presence of CCTV cameras had been installed in the shop where the applicants worked.
The CCTV did indeed show how the thefts were being carried out, which tallied with the stock reports and till receipts. The management informed the employees’ union representative that the footage recorded by the hidden cameras had revealed thefts of goods at the tills by a number of employees. Fourteen employees were dismissed with immediate effect, including the five applicants, of whom three signed settlement agreements in which it was agreed no criminal proceedings would be brought against them and other employment claims would be waived by both sides. Only the manager and the union representative watched the CCTV footage.
The five applicants then brought unfair dismissal claims against the supermarket. The applicants objected to the use of the covert video-surveillance, arguing that it had breached their Article 8 right to protection of their privacy. They thus requested that any recordings obtained by such means should not be admitted in evidence in the proceedings. The employer opposed the proceedings brought by the 3 employees who had signed settlement agreements but those applicants sought the annulment of the agreements, arguing that they had signed them under the threat of criminal proceedings and that their consent had been vitiated by duress and by the deceitful manipulation of the employer with the complicity of the union representative.
The Spanish employment tribunal found that any employer was entitled to use monitoring and surveillance measures to verify that employees were fulfilling their employment duties, provided those measures were compatible with their “human dignity” and thus respected their fundamental rights – an employer’s right to adopt monitoring measures in the exercise of its management power and for the purpose of ensuring the smooth running of the company was limited by the respect due to the employees’ right to their privacy and to the protection of their image. Courts are supposed to strike a balance between the various interests of constitutional value by applying a proportionality test to the employer’s measures. In this case, it had found that the covert CCTV had been proportionate and had not breached the employee’s fundamental right to privacy guaranteed by Article 18 of the Spanish Constitution. In the tribunal’s view, the applicants’ conduct amounted to a breach of the principle of good faith and entailed the employer’s loss of trust, thus rendering their dismissals lawful. Further, there had been no evidence of coercion or manipulation by the employer regarding the settlement agreements.
The Grand Chamber of the European Court of Human Rights held by a majority of 14 to 3 upheld the decisions of the lower courts that a fair balance had been struck and the intrusion was proportionate because the employer had legitimate reasons. No violation of the Article 8 right to respect for private and family life had occurred. Not being informed in advance that they would be recorded did not violate the employees’ Article 8 right to private life. The Court held that employees should have a limited expectation of privacy at work on a supermarket floor (a public area) and found that the employer had taken steps to confine the circulation of the recordings to a very limited number of people. The surveillance was limited to ten days, had stopped once the responsible employees had been identified, and the recordings were targeted at a small group of individuals.
The three dissenting judges, however, were concerned by the
growing influence and control that technology has in our world, and more particularly, the collection and use of our personal data in our everyday activities. As a living instrument, the Convention, and therefore the Court, not only needs to recognise the influence of modern technologies, but also has to develop more adequate legal safeguards to secure respect for the private life of individuals.
Contracts: Is £500+VAT enough for an employee to take full advice on a settlement agreement?
It is often the case that when it comes to an employer offering an employee a settlement agreement, they agree to pay the costs of that employee taking advice. A common fee is £500+VAT. In order for the agreement to be fair, the employee needs to be given the opportunity to discuss the effect of signing a settlement agreement which in effect means they waive all rights to pursuing any claims against the employer in future.
In the case of Solomon v University of Hertfordshire [2019] UKEAT 0258_18_2910, one of the EAT judges made an obiter comment at the end of the judgment, basically saying that £500+VAT was not enough for an employee to take full advice on settling their claim:
… We think it clear that the advice which the Claimant could expect to receive for this sum (or any sum remotely like it) would only relate to the terms and effect of the proposed settlement and its effect on her ability to pursue her rights thereafter (see section 203(3) of the Employment Rights Act 1996). Any advice as to the merits of the Claimant’s claim and the likely award of compensation would require reading and consideration on a quite different scale. So even if the Claimant had sought advice, she would still have had to make her own lay assessment as to the merits of her claim and the likely award of compensation. The ET said, in paragraph 10 of its reasons, that the offer of £500 plus VAT was for a solicitor “to advise on the merits of a settlement”. If so, the offer was wholly unrealistic.
This may be something to bear in mind when considering settlement agreements, given the amount of the settlement and the potential claims that may be involved. This case concerned a figure of £50,000 regarding claims of unlawful discrimination, victimisation and sexual harassment.
Whistleblowing: Public interest test is subjective so claimant must be given opportunity to give evidence
In 2017, the case of Chesterton Global Ltd (t/a Chestertons) v Nurmohamed [2017] EWCA Civ 979, set out a two -stage test for determining the question of what is in the “public interest” for whistleblowing claims (i.e. to enable the disclosure to be a qualifying disclosure within s.43B(1) of the Employment Rights Act 1996, making it a “protected disclosure”). The test states that (1) the claimant must believe, at the time of making a disclosure, that it is in the public interest, and (2) that belief must be reasonable. This is a subjective belief, about which that person must be asked directly at tribunal so that they can be cross-examined. It is up to the tribunal to consider the evidence and make findings as to subjective belief and the reasonableness of that belief.
In the recent case of Ibrahim v HCA International Ltd [2019] EWCA Civ 2007, Mr Ibrahim was an interpreter at a hospital. He asked his employer to investigate rumours that he had breached patient confidentiality, as he wanted to clear his name and reputation. The hospital investigated his complaint but his complaint was rejected and he was later dismissed. He brought several claims to the tribunal, among which was that he had suffered a detriment following making a protected disclosure. The tribunal dismissed his whistleblowing claim on several grounds, one of which was that he had not made it in the public interest but to clear his own name. The EAT agreed, finding that Mr Ibrahim had held no subjective belief in the public interest. Additionally, the judge confirmed that breach of a legal obligation under section 43B(1)(b) of the ERA 1996 can be broad enough to include tortious duties such as defamation and those statutory duties contained in the Defamation Act 2013. It was immaterial that Mr Ibrahim had not used the word ‘defamation’ himself.
Mr Ibrahim took the matter to the Court of Appeal. The Chesterton two-stage test had been handed down after the tribunal hearing but before the judgment, and so Mr Ibrahim claimed the tribunal had not applied the test correctly. The Court of Appeal found that the tribunal erred in that it should have specifically asked him about his subjective belief, although in this case, it was probably down to the timing of the case. In addition, a further onus was on the tribunal to ensure he explained his case as he was unrepresented. The decision in Chesterton made clear that motive and genuine belief in public interest are not the same thing. Mr Ibrahim had not said anything about public interest, which hampered his case, but did not dispose of the point. His appeal was therefore allowed and the case remitted back to the same tribunal to hear evidence from Mr Ibrahim and for consideration of this point.
Other News:
Data Protection: ICO publishes new detailed guidance for Data Protection Officers
The Information Commissioner’s Office (ICO) has recently published a new set of detailed guidance on ‘Special Category Data’. This guidance is targeted at:
- those people for whom the existing Guide does not provide the answers you are looking for; or
- those needing a deeper understanding of the conditions for processing special category data to help you comply in practice;
- Data Protection Officers; and
- those with specific data protection responsibilities in larger organisations.
Special Category Data is a collection of types of personal data which are likely to be more sensitive, and which are therefore entitled to receive extra protection, for example: personal data revealing racial or ethnic origin, political opinions, religious or philosophical beliefs; health, sexual orientation, etc.
This guidance contains practical examples of special category data and its processing requirements and is arranged in four sections:
- What is special category data?
- What are the rules on special category data?
- What are the conditions for processing?
- What are the substantial public interest conditions?
It goes into detail regarding the general prohibition on processing special category and the ten exceptions to the prohibition referred to as the conditions for processing special category. The guidance emphasises the importance of identifying special category data and approaching it carefully. If your purpose is not covered by any of the processing conditions and you cannot obtain valid explicit consent, you cannot process the special category data.
Gender Balance: Hampton-Alexander Review’s fourth annual report published
On 13 November 2019 the Hampton-Alexander Review announced it has published it fourth Annual Report on improving gender balance in FTSE leadership. The original report was published in 2016 and set a target of getting a minimum of 33% women’s representation on the boards and on the leadership teams (meaning those who either sit on a company’s executive committee or directly report to members of that committee) of FTSE 350 companies by the end of 2020. According to this year’s annual report, this has been the strongest year of progress since targets were first set:
- FTSE 100 on track to reach the 33% target for women on boards ahead of the 2020 deadline.
- FTSE 250 made strong gains during the year and with sustained effort, will also meet the 2020 deadline.
- Women now hold 32.4% of FTSE 100 board positions (up from 30.2% in 2018), but 51 FTSE 100 companies have not yet achieved the 33% target.
- Women now hold 29.6% of FTSE 250 board positions (up from 24.9%), but 139 FTSE 250 companies have not yet achieved the 33% target.
- The FTSE 350 still has 2 all-male boards (5 in 2018) and 39 companies that have only one woman on the board, 28 of which have had only one woman for the second year running.
- Women now hold only marginally more chair, senior independent director and CEO roles. Across the FTSE 350 there are only 25 female chairs (5 in the FTSE 100), 80 female SIDs (20 in the FTSE 100) and 14 female CEOs (6 in the FTSE 100). There are only 74 female executive directors (30 in the FTSE 100), being 11% of executive directors in the FTSE 350.
However, it also reported that a step-change is needed for senior leadership roles below board level: 50% of all appointments next year need to go to women, or the 2020 target will not be met.
Workplace Diversity: ONS figures reveal number of mothers in the workforce reaches a record 75%
The government’s Office for National Statistics has released its ‘Families and the labour market, UK: 2019’ report. It shows the employment rates of men and women with dependent children in the UK, based on data from the Labour Force Survey and Annual Population Survey. This year’s figures demonstrate that:
- The number of mothers in the labour market has reached 75.1%, a significant increase compared with 66.2% of mothers in 2000.
- The number of working fathers has increased from 89.4% in 2000 to 92.6% in 2019.
- Almost 3 in 10 mothers (28.5%) with a child aged 14 years and under said they had reduced their working hours because of childcare reasons. This compared with 1 in 20 fathers (4.8%).
- The proportion of parents who faced an obstacle fulfilling responsibilities decreased as the age of the child increased; from 34.9% of parents whose youngest child was aged between 0 and 4 years to 20.4% of parents with a child aged 11 to 14 years.
This is good news for employers who are arguably getting access to a broader talent pool with more mothers returning to work, and demonstrates how much employers need to be aware of how much family life impacts their workforce – both male and female.
Mental Health: Nuffield publishes whitepaper on effects of remote working on stress, wellbeing and productivity
Nuffield Health, working with the University of Manchester and Manchester Metropolitan University, have published a whitepaper on ‘The effects of remote working on stress, wellbeing and productivity’. The opinions of over 7,000 employees were used to gather the data. The paper looks at the varied effects of remote working on different demographics and begins to explore the future of flexible working.
From the basis of the data, the paper has also made some recommendations for employers who do already, or want to, use remote working. These include:
- Having an organisation-wide policy on remote-working.
- Understanding that remote working requires significant management time to ensure it works effectively.
- Consideration of the impact of remote working on the mental health of employees.
- Avoiding the feeling of isolation by helping managers to foster social and professional interaction, and providing the sense of belonging to a bigger group.
- Giving workers training so that they are able to navigate remote working and get the most out of it.
- Developing a relationship of trust between managers and workers.
- Ensuring their working space is adequate, wherever it may be.
- Communication between employers and workers is key to many of these considerations for example, agreeing work hours.
This is an important read for all employers now that technology is enabling us to have more flexibility. A one-size-fits-all approach could be damaging as workers should be treated on an individual basis to ensure the best working relationship, getting the best out of people, which depends on their individual circumstances.
National Minimum Wage: Rates for April 2020 delayed by general election
The Budget is the usual forum for the government to announce the latest National Minimum Wage Rates which are due to take effect from the following April. This year’s Budget has been cancelled due to the general election. Usually, the Low Pay Commission presents its recommendations to the government at the end of October, following which the government sets out its response and confirms any changes thereto in the Autumn Budget.
With no place for the Chancellor to make his announcement, this may mean it is delayed until January 2020. If your business carries out pay reviews in early January this may mean setting wages without knowing whether you will be able to comply in April.
The Low Pay Commission’s (LPC) recommendations are not yet known but the CIPD have produced their submission to the LPC earlier in the year, which may provide food for thought.
Tribunals & Courts: Closures over Christmas and New Year 2019
Details have now been published by Her Majesty’s Courts and Tribunals Service (HMCTS) of the closures of courts and tribunals over the Christmas holiday period, including Crown Courts, Magistrates’ Courts, County and Family Courts, the Royal Courts of Justice and the Rolls Building, and Tribunals. For more information see here.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com
-
Employment Law Newsletter – September 2019
Cases:
- Unfair Dismissal: Employee Shareholder Status not altered by subsequent service agreement
- Holiday pay: Part-year workers not subject to pro rata reduction
- Worker status: Out of hours GP is a worker despite using limited company
- Disability Discrimination: Tribunal must address all four limbs of the definition of disability
- Harassment: Conduct that creates an offensive or humiliating environment
- Legal Advice Privilege: Waiving privilege does not mean you can cherry-pick what you disclose
Other news:
- Information Commissioner’s Office: Brexit hub
- Data Protection: Subject Access Requests and Individual Rights – timescales changed
- Modern Slavery: Updated guidance, referral and assessment forms available from Home Office
- Non-Disclosure Agreements: Law Society publishes new guidance
- Upskilling: Give me the chance to save my job
Unfair Dismissal: Employee Shareholder Status not altered by subsequent service agreement
In Barrasso v New Look Retailers Limited UKEAT/0079/19 the EAT had to consider how ‘employee shareholder status’ is terminated, as it is not provided for under the Employment Rights Act 1996 (‘ERA’). The concept of ‘employee shareholder status’ was introduced in 2013. It applies to those who are employed by a company in which they are issued £2,000 worth of fully paid up shares, having first agreed to be an employee shareholder and received information about the status, its rights and independent legal advice. Having the status means they retain some key employment rights but give up others (in return for the shares), such as the right to claim unfair dismissal or receive a statutory redundancy payment. S.205A of the ERA prescribes how one achieves this status but it silent on how it is terminated.
Mr Barrasso was employed as UK Managing Director by New Look until it was sold to another company and he was offered 7,000 shares in the parent company if he signed an Employee Shareholder Agreement (and met the criteria under the ERA), which he did. He was reassured by side letter (signed as a deed between the parties) that he would receive contractual benefits equal to the statutory employment rights he was giving up. He subsequently signed a new director’s service agreement (to standardise terms for all the directors) as a deed. This agreement contained a ‘complete agreement clause’ which purported to preserve the effect of the side letter (not mentioning the Employee shareholder agreement), whilst superseding all other agreements.
Believing that his employee shareholder status had been terminated by the service agreement when Mr Barrasso’s employment was terminated he brought a claim for unfair dismissal. The tribunal dismissed his claim on the basis that the service agreement made no reference to the employee shareholder status – therefore did not supersede it – and the side letter meant the statutory rights had been removed in favour of his contractual rights. He appealed to the EAT, who agreed with the tribunal’s findings. They also looked at how the status could have been terminated practically-speaking, given that the ERA is silent on this, citing examples such as: a new contradictory contract, or an agreement to sell back the shares. It was clear to the EAT however, that the intention of the parties was not to alter Mr Basrrasso’s employee shareholder status by signing his service agreement.
Holiday pay: Part-year workers not subject to pro rata reduction
The Court of Appeal has overturned the decision of an employment tribunal (Harpur Trust v Brazel [2019] EWCA Civ 1402), finding that it should not have read words into reg.16 of the Working Time Regulations 1998. The tribunal had been wrong to read it as if it meant the annual leave entitlement of ‘part-year workers’ (people who work only part of the year) on permanent contracts should be capped at 12.07% of the annualised hours. The Court accepted that ECJ rulings may allow employers to use the Working Time Directive to pro rate the annual leave entitlements of part-year workers to that of full-year workers, but member states may implement better arrangements. There is no requirement in the Working Time Regulations to pro rate holiday pay for part-time employees to ensure that full-time employees were not treated less favourably, it is simply a protection for part-time workers to not to be treated less favourably than full-time workers.
There is a lesson here: employers who employ the 12.07% approach to pay holiday to staff on zero hours permanent contracts should consider their potential exposure and their options. The calculation exercise required by regulation 16 of the WTR 1998, which involves identifying a week’s pay and multiplying it by 5.6 weeks, is straightforward and should be followed, even if it results in part-year workers receiving a higher proportion of their annual earnings as holiday pay (in this case, 17.5%). How the 5.6 weeks’ holiday entitlement itself should be calculated for part-year workers remains unclear, however. As a direct result of this case, BEIS has removed its holiday pay calculator from its holiday pay guidance for workers without fixed hours or pay. BEIS are currently reviewing this.
Worker status: Out of hours GP is a worker despite using limited company
In Community Based Care Health Ltd v Narayan UKEAT/0162/18, Community Based Care Health Ltd (‘CBCH’) provided out of hours GPs to the NHS (each of whom had to be fully qualified and competent), and Dr Narayan provided her services as a GP through CBCH for a number of years. She worked a regular shift pattern but did not need CBCH’s permission to take leave or work elsewhere so there was no mutuality of obligation. She did provide her own equipment and indemnity insurance, and had to work personally for the company and could not send a preferred substitute instead. CBCH audited the services of the GPs it provided to comply with its NHS contracts. Dr Narayan began to use a limited company of her own to receive her payments but never informed CBCH of this fact, merely updated her bank details.
Following an issue with some telephone advice Dr Narayan had provided and a claim that she had unjustifiably swapped duties on short notice, CBCH decided it was no longer going to offer her work. Dr Narayan brought claims of unfair dismissal, race and sex discrimination, breach of contract and unpaid holiday pay. CBCH claimed she was self-employed and neither an employee nor a “worker”. The tribunal disagreed.
The judge found that Dr Narayan was a worker under s.230(3)(b) of the Employment Rights Act 1996, despite the fact that she had used a limited company to receive payments for over a year without CBCH’s knowledge. CBCH had tried to argue that this had led it to unwittingly become one Dr Narayan’s company’s clients under the ‘undisclosed principal’ doctrine (i.e. if A makes a contract with Z in A’s own name, it is open to B at a later date to assert that the contract was made by A on B’s behalf and that B is the contracting party. This means that the resulting contract is between B and Z.) CBCH claimed that therefore it was contracting with Dr Narayan’s company, and not her. This was dismissed from the appeal because it had not been argued at first hand, but in any event the fact that the contract required a competent and suitably qualified doctor precluded a company from being the contracting party. Further, the judge found that the decision in Suhail v Herts Urgent Care UKEAT/0416/11 was not a good precedent he was bound to follow in this case, distinguishing it on the basis that Dr Suhail positively marketed his services to other clients. Dr Narayan, on the other hand, worked for one provider for a number of years on a regular shift pattern. The judge also found the evidence suggested Dr Narayan had been integrated into CBCH’s business. The EAT upheld the tribunal judge’s decisions and found no error of law.
Disability Discrimination: Tribunal must address all four limbs of the definition of disability
In Parnaby v Leicester City Council UKEAT/0025/19/BA Mr Parnaby suffered depression brought about by work-related stress and was dismissed because of his long-term sickness absence due to work related stress (a capability issue). Mr Parnaby claimed this dismissal was in fact disability discrimination and/or potentially unfair. The tribunal found him not to be a disabled person for the purposes of the Equality Act 2010 (“the Act”) though it did accept that he suffered an impairment that had a substantial adverse effect on his ability to carry out normal day to day activities but held this was not long-term. In particular, the tribunal noted that Mr Parnaby had suffered work related stress for six months, but that it had ceased following his dismissal, therefore the effect was not ‘long-term’ (i.e. 12 months or more) for the purposes of paragraph 2 Schedule 1 of the Act. Mr Parnaby appealed.
The EAT allowed the appeal. It held that the tribunal had erred in not addressed all four limbs of the definition of disability contained in the Act. Mr Parnaby had suffered depression brought about by work-related stress which affected his ability to carry out his day-to-day activities – his impairment. The act of discrimination claimed was the dismissal. At that time, his impairment had not lasted for 12 months (s.2(1)(a) of Sch1 to the Act) and was therefore not ‘long-term’. However, the tribunal considered that by removing the source of his impairment (his job) then the likely future impairment and its impacts would cease. The EAT held that the tribunal should have looked at whether it was likely to last twelve months or might recur in the future (i.e. could well happen = more probable than not). It was not for the tribunal to make assumptions about the time-limited nature of his impairment. On this basis the claim was remitted back to tribunal to be reheard.
Harassment: Conduct that creates an offensive or humiliating environment
In Raj v Capita Business Services Limited & Ward EAT0074/19/LA the EAT considered the first tribunal’s dismissal of Mr Raj’s claims of unwanted conduct either of a sexual nature or unwanted conduct relating to his sex, pursuant to s.26 of the Equality Act 2010 (the “Act”). The issue was that the claimant had felt uncomfortable when his female manager massaged his shoulders in their open plan office. Whilst the tribunal found this to be unwanted conduct which created an offensive environment for him, it found that on balance, the evidence provided brought them to the conclusion that whilst the conduct was unwise and uncomfortable but not related to gender, but more likely due to misguided encouragement. This part of the claim failed.
On appeal, the EAT considered the two-stage burden of proof test set out by s.136 of the Act and explained in Igen v Wong [2005] ICR 931. The first stage is that the claimant prove facts from which the tribunal could decide, in the absence of any other explanation, that the respondent committed an unlawful act of discrimination. The second part is only applicable if the first stage is met, and then puts the burden of proof onto the respondent who must prove he/she did not commit that unlawful act. The EAT agreed with the tribunal’s finding that in this case, the claimant fulfilled stage one – it was agreed that there was conduct that was unwanted, thereby producing “an intimidating, hostile, degrading, humiliating, or offensive environment for him”. However, the remaining issue for stage two was whether this conduct related to the claimant’s gender. The tribunal found the evidence to show a prima facie case that this conduct related to his gender to be very limited. The appeal was on the basis that the tribunal had erred in law by not approaching the test properly but the EAT did not agree; the burden of proof had not shifted to the respondent and, in any event, the explanation given by the respondent had been accepted.
Legal Advice Privilege: Waiving privilege does not mean you can cherry-pick what you disclose
This is a warning case to employers involved in litigation. In Kasongo v Humanscale UK Ltd UKEAT/0129/19 the claimant brought claims of unfair dismissal and discrimination related to pregnancy and maternity. Part of the employer’s strategy was to waive its legal advice privilege (i.e. communications between a client and their solicitor which are confidential and come into existence for the purpose or giving or receiving advice about what should prudently or sensibly be done in the relevant legal context) because certain documents arguably demonstrated that it did not know about the claimant’s pregnancy at the time it was considering dismissing her. The documents comprised a draft dismissal letter prepared by the solicitors from which the solicitors notes and comments had been redacted (it was agreed that the letter itself was not legally privileged, but the redacted parts were) and two earlier documents. The issue was whether the disclosure of the two earlier documents meant that the redacted parts were no longer protected by privilege, and therefore if the tribunal had erred in its decision as to which documents were protected by legal advice privilege.
The EAT held that the tribunal had erred in failing to address or rule on one of the three documents. All three documents were part of the same transaction of providing legal advice about the dismissal of the claimant and, given the nature and purpose of the disclosure, the EAT held that fairness required that the redacted part of the letter concerning the reason for the claimant’s dismissal also be disclosed. The reason being that it would be unfair to allow the respondent who had waived privilege in relation to the other two documents not to reveal those redacted parts of the dismissal letter which related to the reason for dismissal. Cherry-picking the parts one discloses is therefore impermissible. The appeal was allowed and the EAT ordered that the redactions be removed and the full letter be included in the trial bundle for evidence at the hearing.
Other news:
Information Commissioner’s Office: Brexit hub
The ICO has put together a ‘Brexit hub’ containing checklists, FAQs and guidance to help organisations of every size in case prepare for a no-deal Brexit. A good place to stay up to date with how your business manages its data protection duties. You can also sign up to their service to receive regular emails which will let you know about any updates to the guidance.
Data Protection: Subject Access Requests and Individual Rights – timescales changed
In August, the Court of Justice of the European Union ruled on a Dutch case which considered timescales under Regulation No 1182/71. Following this ruling, the Information Commissioner’s Office has updated their guidance on timescales for responding to subject access requests (SAR), and other individual rights requests.
The effect of the ruling is that the timescale has now changed to reflect the day of receipt as ‘day one’, as opposed to the day after receipt. For example, a SAR received on 3 September should be responded to by 3 October.
Modern Slavery: Updated guidance, referral and assessment forms available from Home Office
Following recent reforms made to the National Referral Mechanism (NRM) (a government framework for identifying and referring potential victims of modern slavery and ensuring they receive the appropriate support), the Home Office issued new Modern slavery victims: referral and assessment forms. The forms allow staff at designated First Responders Organisations to refer potential victims of modern slavery or human trafficking to the NRM.
The recent reforms to the NRM include:
- The Home Office created a single, expert unit to handle all cases referred to it to handle decision making about whether somebody is a victim of modern slavery. This replaces (and is completely separate from) the case management units in the National Crime Agency and UK Visas and Immigration.
- All negative Conclusive Grounds decisions will now be reviewed by an independent panel of experts, to increase the scrutiny such cases receive.
- The NRM process will be supported by a new digital system, enabling easier referrals, data capture and analysis, aimed at improving prevention and law enforcement.
For more details on which organisations form part of the First Responders list, see the government website.
Non-Disclosure Agreements: Law Society publishes new guidance
Following our reporting of the Women and Equalities Committee’s review of the use of Non-Disclosure Agreements in discrimination cases, the Law Society has now published a brief guidance leaflet called ‘Non-disclosure agreements: what you need to know as a worker’. This is just as helpful to employers as it summarises both the things employers cannot stop workers from doing and explains the restrictions commonly imposed on workers prior to signing the NDA.
This has been published as part of the Law Society’s new legal education initiative to assist the public understand their rights.
Upskilling: Give me the chance to save my job
PwC has recently published a new study called ‘Upskilling Hopes and Fears’, based on a survey of 22,000 people globally, of whom 2,004 were UK adults in the age range 18-65 (retirees were not included). Their findings show that 73% of workers would welcome the opportunity to expand their knowledge of new workplace technology while 54% of those questioned said they would be happy to learn new skills or completely retrain in order to improve their future employability. But many UK workers say their employers are not offering opportunities to upskill. People fear automation in a growing digital world will lead to fewer jobs and this lack of investment in the workforce is breeding mistrust of employers among workers.
The research also highlights disparities in upskilling opportunities by gender, education, and age:
- Over half (54%) of men surveyed say their employer is giving them the chance to learn new skills, as opposed to only 45% of women. Over half of women (55%) say they are offered no opportunities at all.
- 56% of university graduates say they are offered them, whereas only 41% of those educated to school leaver level say the same.
- 64% of workers aged 18-34 say they are offered opportunities, compared with 48% of 35-54 year olds and 41% of ages 55 and over.
These results highlight the need for organisations to look seriously at offering upskilling opportunities for staff – particularly in the UK where three-quarters (73%) of workers would take the opportunity to better understand or use technology if they were given the option by their employer.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
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Employment Law Newsletter – July 2019
Cases:
- Discrimination: Can a tribunal use stereotypical assumptions on which to base its conclusions, even if the parties never raised them?
- Contract drafting: Century old authority on restrictive covenants reversed by Supreme Court
- Harassment: Is posting an offensive image on Facebook carried out ‘in the course of employment’?
- Disability Discrimination: Employers should make enquiries about an employee’s difficulties to avoid constructive knowledge
- Agency Workers: Agency workers not entitled to same number of contractual hours as directly-recruited comparators
- TUPE: Obligation on transferee to keep and produce wage records for transferring employees
- Right to Privacy: WhatsApp messages used in Police disciplinary proceedings
Other news:
- ACAS: 2018-19 Annual Report Published
- Equality: Gender Equality Roadmap published
- Health at Work: Joint government consultation to reduce job losses
- Employment Rights: ‘Good Work’ continues – new consultation on enforcement body for employment rights
- ICO: Guidance published on the Use of Cookies and Similar Technologies
Cases:
Discrimination: Can a tribunal use stereotypical assumptions on which to base its conclusions, even if the parties never raised them?
In Commerzbank AG v Rajput UKEAT/0164/18/RN the Claimant brought claims of direct sex discrimination, harassment (s.26 Equality Act 2010) and maternity leave discrimination. The ET upheld the claims. In its conclusion it held that the decision-makers had acted on the basis of certain stereotypical assumptions about women and about women taking maternity leave. The Respondent appealed against the sex discrimination/harassment decisions because these stereotypical assumptions had not formed part of the Claimant’s case; nor had the tribunal made any suggestion to the Respondent or its witnesses that it had considered such matters when drawing inferences about the reasons for the conduct of which the complaint was made. The reference to stereotypical assumptions had appeared for the first time in the judgment; and accordingly, the Respondent and its witnesses had had no opportunity to challenge the existence of the alleged stereotypical assumptions or their application to the conduct of the decision-makers. This therefore constituted unfairness.
The Respondent challenged one of the two findings of maternity leave discrimination on the basis that the tribunal had wrongly substituted a ‘but for’ test of causation for the subjective test required by s.18(4) of the Equality Act.
The EAT dismissed the appeal on maternity leave discrimination, holding that on a fair reading of the judgment the tribunal had applied the correct test of causation. However, it upheld the appeal on sex discrimination/harassment. The EAT held that it was unfair of the tribunal to not give the Respondent and its witnesses prior notice and the chance to respond to the suggestion that they had acted on the basis of stereotypical assumptions. The claims were remitted to be heard before a new tribunal.
Contract drafting: Century old authority on restrictive covenants reversed by Supreme Court
In Tillman v Egon Zehnder Limited [2019] UKSC 32 the Supreme Court was asked to consider an interesting contract drafting point. Ms Tillman worked for Egon Zehnder Limited, an executive search firm. When she left them, she sought to get out of her contractual six-month non-compete clause by arguing that the words “directly or indirectly engage or be concerned or interested in” any competing business was unenforceable as a restraint of trade because it had the effect of restraining her from even holding any shareholding in a competitor and was thus far too wide. The Supreme Court agreed with the finding of the Court of Appeal that the words “interested in” were unreasonably wide, but found that it had been wrong to conclude that the offending words could not be severed from the remaining, reasonable parts of the covenant, thus rendering the remainder enforceable. This decision by the Supreme Court reversed a Court of Appeal authority (Attwood v Lamont [1920] 3 KB 571) which had been in place for 99 years.The Supreme Court instead preferred the threefold approach laid down by the Court of Appeal in Beckett Investment Management Group Ltd v Hall [2007] EWCA Civ 613:
- application of the blue pencil test – there can only be removal of words if upon removal there is no need to add to or to modify the wording that remains in order for it to remain enforceable;
- the remaining terms must continue to be supported by adequate consideration (i.e. payment or something of value); and
- the removal of the offending provision must not generate any major change in the overall effect of all the post-employment restraints in the contract.
Harassment: Is posting an offensive image on Facebook carried out ‘in the course of employment’?
In Forbes v LHR Airport Limited [2019] UKEAT 0174_18_2802 an employee (DS) posted a picture of a golliwog on her Facebook page with the caption “Let’s see how far we can make him travel before Facebook takes him off”. Her friends list included some of her colleagues, but not the Claimant. One colleague (BW) showed it to the Claimant who found it offensive and raised a grievance at work. DS was disciplined. When the Claimant was rostered to be working with DS he complained to his union representative because his grievance had been upheld, and was moved to another location without explanation.
The Claimant brought claims against the employer for harassment, victimisation and discrimination on the grounds of race because he felt it was vicariously liable. The tribunal found differently, and dismissed the claims on the basis that DS had not been acting ‘in the course of her employment’. She had not posted the image while at work, had not used work equipment to do it, the image had been shared amongst a private group (of which the Claimant had not been part) and had made no reference to the employer. The Claimant appealed on the grounds that 1) the image had been shared in the workplace, 2) the tribunal had been swayed by DS’s motive and whether she intended to cause offence, rather than the effect of the conduct, and that 3) the Respondent did not take all reasonable steps to prevent the discriminatory act from occurring.
The EAT found that DS had not acted in the course of her employment and the fact that they acted to discipline her for it, whilst not being an act carried out at work, was entirely appropriate and reasonable for them to do. Since the act was not done ‘in the course of employment’, the Respondent employer could not be held vicariously responsible and it renders the other arguments academic. However, the EAT went on to hold that there was no error by the tribunal as it took into account all the matters it was required to do, and that the Respondent had taken DS’s conduct seriously and given her a final written warning to prevent further discriminatory behaviour. The appeal was dismissed.
Disability Discrimination: Employers should make enquiries of an employee’s difficulties to avoid constructive knowledge
In A Ltd v Z [2019] UKEAT/0273/18/BA the Claimant suffered from mental and psychological problems – stress, depression, low mood and schizophrenia, but she had not disclosed these to her employer as reasons for her absences from work, instead citing other health related reasons. At tribunal it was accepted that the Claimant was disabled for the purposes of the Equality Act 2010. The employer had dismissed her due to poor attendance and time-keeping, and whilst the tribunal found that the employer had no actual knowledge of her disability, it found that the employer should have made further enquiries into the reasons for her problems at work. The Claimant had not been forthcoming about her real problems and the employer had therefore not known anything more than she was having personal problems, from which she also suffered stress as a result. The Claimant’s s.15 Equality Act claim (i.e. discrimination because she was treated unfavourably due to her disability) succeeded on the basis that the employer had constructive knowledge of her disability.
The employer appealed. The EAT held that the tribunal had erred in only asking itself what process the employer might have been expected to follow, but then failed to address the critical issue of what the employer ought to have known. It reasoned that if the tribunal found that if the employer had made further enquiries the claimant would probably have continued to hide her real condition and refused a referral to Occupational Health, therefore the EAT held that making further enquiries would not have produced any further information and so the case for constructive knowledge was not made. The EAT upheld this part of the claim.
Agency Workers: Agency workers not entitled to same number of contractual hours as directly-recruited comparators
In Kocur v Angard Staffing Solutions Ltd and another [2019] EWCA Civ 1185 the Claimant was an agency worker at Royal Mail’s Leeds Mail Centre where there was a core of permanent staff supplemented by agency staff. He alleged he did not receive the same rest breaks or hours of work as the permanent employees. The tribunal dismissed these claims but on appeal, the EAT allowed the claim regarding breaks but dismissed the claim regarding equivalent hours. The claimant took the matter to the Court of Appeal.
In making its decision, the Court of Appeal looked at the statutory language and underlying purpose of the Agency Workers Regulations 2010 and the Agency Workers Directive. It found there was nothing in the legislation to suggest that they were meant to regulate the amount of work that employers are to provide to agency workers, specifically drawing attention to regulation 6(1)(b) of the Agency Workers Regulations 2010 which includes the duration of working time as a relevant term and condition which it found was intended to refer to terms which set a maximum length for any such periods. Accordingly, the Court held that the legislation entitle agency workers to the same working conditions as directly-recruited comparators, but does not entitle them to the same number of hours.
TUPE: Obligation on transferee to keep and produce wage records for transferring employees
S.9 of the National Minimum Wage Act 1998 (NMWA) imposes an obligation on employers to keep pay records, including where an employee’s employment has ceased. In Mears Homecare Limited v Bradburn and others [2019] UKEAT 0170_18_0205 the Claimants served 10 production notices under s.10 of the National Minimum Wage Act 1998 requesting wage information from the Respondent for the preceding 12 months. Out of that 12 months, 9 were spent with the Respondent as the employer and 3 months where the transferee was the employer because a TUPE (Transfer of Undertakings (Protection of Employment) Regulations 2006 – “TUPE”) transfer had taken place. The Respondent (the transferor) failed to produce the information within the 14 days required and therefore the Claimants brought their claims before the tribunal, as they were entitled to do so. The tribunal upheld their complaints and awarded them each the sum of £600, payable by the Respondent because where there has been a relevant transfer under TUPE, the duty to maintain wage records stays with the transferor. The Respondent appealed.
The EAT overturned the decision. A transferor was not required to maintain such age records and therefore did not need to comply with the s.10 production notices. The EAT held that because under TUPE a person’s employment does not cease for the purposes of the NMWA. Their employment continues with the transferee. The liability transfers as well, therefore it is incumbent upon transferees to insist that, as part of the transfer agreement, pay records are also delivered by the transferor.
Right to Privacy: WhatsApp messages used in Police disciplinary proceedings
In BC and others v Chief Constable Police Service of Scotland and others [2019] CSOH 2019, 28 June 2019 the Outer House of the Court of Session (Scotland) considered whether or not WhatsApp messages were capable of being used as evidence in misconduct proceedings. An officer, during a criminal investigation into sexual offences, had his smartphone confiscated and examined. Certain WhatsApp messages were discovered between a group of police officers. The messages were not used in that investigation but were subsequently used by the Police Service of Scotland (i.e. their employer) as a legal basis for bringing separate misconduct proceedings against a group of officers who were members of the chat group. The officers argued that it was a breach of their right to privacy under common law and Article 8 of the European Convention on Human Rights to use messages for a purpose collateral to the original investigation.
The court held that in normal circumstances there would be an expectation of privacy of individuals for any messages sent via WhatsApp. However, the police are subject to high professional standards which apply both when they are on and off duty. Thus, their expectation of privacy is limited. Failure to meet and comply with those standards would be likely to interfere with the impartial discharge of that officer’s duties or at least give that impression to the public, and this was the case here.
This is the first time that a Scottish court has expressly declared that there is a common law right to privacy in Scotland (in England the courts recognised and developed the concept of a common law right to privacy – this was most clearly seen in Campbell v MGN Ltd [2004] 2 AC 457), though this is a decision of the Outer House and therefore only of persuasive authority in the Court of Session and lower courts. It does not apply in England but it is useful to see how technology is permeating the law as its influence and reach grows, and this issue may yet be considered before the English courts.
Other news:
ACAS: 2018-19 Annual Report Published
ACAS has recently published its latest Annual Report and Accounts for 2018-19. It discusses ACAS’s three strategic aims (below), how it has managed these over the last year and its plans to develop them more in the future.
- To advise on good practice in everyday working life
- To resolve disputes and manage conflict
- To influence employment policy and debate
There are also performance indicators showing how they have delivered against target over the last two years. It also includes figures showing where matters have been referred to ACAS for early conciliation from the tribunals, which are increasing year on year.
Equality: Gender Equality Roadmap published
On 3 July, Penny Mordaunt (Minister for Women and Equalities) launched the Government Equalities Office’s Roadmap for change: “Gender equality at every stage: a roadmap for change”. The plan is to financially empower women from school to retirement, by including measure such as a review of enforcement of equal pay legislation, and improved information for parents around family friendly entitlements. At the same time, the Women’s Business Council is to be refreshed. There will be a new chair – Fiona Dawson, the Global President of Mars Food, Multi-sales and Global Customers . The aim will be tackling individual sectors to ensure they are closing their gender pay gaps and at the same time that female staff have the same opportunities as their male counterparts.
Some of the proposals of the roadmap include:
- a consultation on strengthening measures to tackle sexual harassment (including clarifying the rules on third party harassment, exploring whether protections need to be extended to interns and volunteers,and considering whether to extend the three-month time limit for bringing discrimination and harassment claims)
- consulting on a new right to carers’ leave
- reviewing the enforcement of equal pay legislation
- assessing the effectiveness of gender pay gap reporting and consulting on any changes by 2021
- completing the government’s evaluation of the shared parental leave and pay scheme by the end of 2019, after which it will consider whether to modernise the existing system.
Health at Work: Joint government consultation to reduce job losses
This month, the Department for Work and Pensions and the Department of Health and Social Care launched a joint consultation: Health is everyone’s business: proposals for reducing ill health-related job loss. It sets out proposals which aim to reduce ill health-related job loss. Whilst the government sees that there is much more employers can do to support employees who are managing health conditions, or who are experiencing a period of sickness absence, it recognises that it can and should provide more help for employers, recognising the differences in employers’ capacity and capability to act.
Key proposals include:
- Improving the information and advice the government provides to employers.
- Improving the occupational health market and look at what financial support the government could provide to improve access to occupational health for smaller businesses.
- Encouraging early and supportive action by employers for their employees with health conditions.
- A new right for non-disabled employees to request workplace modifications to assist their return from sick leave, supported by a new Code of Practice and enforceable in the employment tribunal.
- Reforms to the statutory sick pay system, including pro rata payments for phased return to work after sickness absence, changing eligibility requirements.
The consultation seeks views on measures to reduce ill health-related job loss with the emphasis on employers taking more responsibility and having more involvement. You can submit your views online, without having to answer all the questions, here: https://getinvolved.dwp.gov.uk/work-and-health/consultation/. The consultation closes on 7 October 2019.
Employment Rights: ‘Good Work’ continues – new consultation on enforcement body for employment rights
On 16 July 2019, BEIS published a consultation (‘Good Work Plan: establishing a new Single Enforcement Body for employment rights’) on its proposal to change the way employment rights are enforced and therefore protected by creating a single enforcement body. At the moment, the enforcement of employment rights are carried out by the Employment Agency Standards Inspectorate, the Gangmasters and Labour Abuse Authority, HM Revenue and Customs and the Health and Safety Executive. The Director of Labour Market Enforcement oversees the enforcement priorities of the first three, but not the HSE.There are also other areas, such as umbrella companies and holiday pay for vulnerable workers which it would seek to enforce.
The government recognises that moving to a single body risks losing the benefits of specialisation and expertise built up in existing bodies. There would therefore be a transitional period while the new body becomes fully operational. It also cites the examples of other bodies which have combined to produce more powerful single entities: the National Crime Agency and the Competition and Markets Authority.
Among other things, the consultation also seeks views on:
- should the single body have a role in enforcing rights in relation to statutory sick pay, supporting the Equality and Human Rights Commission and a role in enforcing unpaid tribunal awards;
- extending the civil penalties regime used to enforce payment of the national minimum wage;
- transparency in supply chains;
- enforcing joint responsibility for labour market breaches.
You can respond online or by contacting BEIS. See the link here: https://www.gov.uk/government/consultations/good-work-plan-establishing-a-new-single-enforcement-body-for-employment-rights. The consultation closes on 6 October 2019.
ICO: Guidance published on the Use of Cookies and Similar Technologies
The Privacy and Electronic Communications Regulations (PECR) cover the use of cookies and similar technologies for storing information, and accessing information stored, on a user’s equipment such as a computer or mobile device.
This guidance addresses cookies and similar technologies in detail. Read it if you operate an online service, such as a website or a mobile app, and need a deeper understanding of how PECR applies to your use of cookies.
Further Information
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com
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Employment Law Newsletter – June 2019
Cases:
- Disability Discrimination: A perceived risk of future disability is discrimination
- Discrimination: Does contributory negligence affect amount of injury to feelings award?
- Disability Discrimination: Is reliance on Occupational Health reports sufficient to prevent constructive knowledge of a disability?
- Right to Privacy: Employer can rely on material produced under police investigation
- Trade Unions: One-off direct offer is not unlawful inducement
- Tribunal proceedings: Extensions of time where belief reasonable
- Holiday Pay: Under the Working Time Directive holiday pay must include regular voluntary overtime
Other news:
- Sexual Harassment and Discrimination: WEC publishes report on use of NDAs in discrimination cases
- Health & Safety: Employers should support victims of domestic abuse
- Health & Safety: IES publishes report regarding support for epileptic workers
- Data Protection: One year on since implementation of GDPR and Data Protection Act 2018
- Parental Leave: UK ranks near bottom for family friendliness
Cases:
Disability Discrimination: A perceived risk of future disability is discrimination
In Chief Constable of Norfolk v Coffey [2019] EWCA Civ 1061 Lisa Coffey was a police officer in the Wiltshire Constabulary who suffered from a degree of hearing loss which had never caused her any problems in doing her job (‘day to day activities’) and which, everyone agreed, does not constitute a disability within the meaning of the Equality Act 2010. In 2013 she applied for a transfer to the Norfolk Constabulary, but it was refused because on a medical test her hearing fell, as the medical adviser put it, “just outside the standards for recruitment strictly speaking”. She brought a claim for disability discrimination against the Chief Constable of the Norfolk Constabulary because of a (perceived) disability. Section 13(1) of the Equality Act states: “A person (A) discriminates against another (B) if, because of a protected characteristic, A treats B less favourably than A treats or would treat others.” Her claim was upheld by an Employment Tribunal but the Constabulary appealed. The EAT agreed with the tribunal.
Upholding the decisions of the previous tribunals, the Court of Appeal found that the Constabulary did unlawfully discriminate against Ms Coffey because of a perception of a risk of future inability to work in a particular role, as she was clearly carrying out her current front-line officer role without hindrance. It was this perception of a risk of future disability that was discriminatory and resulted in the recruiting officer giving her less favourable treatment. The appeal was dismissed.
Discrimination: Does contributory negligence affect amount of injury to feelings award?
The Law Reform (Contributory Negligence) Act 1945 (‘LRCNA’) basically allows an award for damages to be reduced proportionately where the claimant suffered the damage partly as a result of his/her own actions or those of someone else.It is possible for it to apply to some discrimination claims, but reduction of an award for contributory negligence would rarely, if ever, be justified because of the difficulties in applying the concept of “fault” to the victim of a discrimination claim and the fact that the discriminator may have acted without “fault” in the sense of the 1945 Act.
In First Greater Western Limited & Linley v Waiyego UKEAT/0056/18/RN the Claimant succeeded in bringing a claim for failure to make reasonable adjustments and a claim for disability discrimination, for which she was awarded £19,800 for injury to feelings in respect of the first claim and £8,800 for injury to feelings arising from the second claim. Both sides appealed.
On appeal, the Respondent claimed that the LRCNA could be applied to discrimination claims and that the tribunal failed to make any deduction to reflect the Claimant’s contributory negligence in failing to give the employer details of her previous cognitive behavioural therapist. The EAT held that the obiter dictum relied upon in Way v Crouch [2005] ICR 1362 was in fact too broad and a contributory negligence argument in a discrimination claim may be more appropriately treated as an allegation of failure to mitigate loss. It further held that the tribunal had not erred in its assessment of the quantum of non-financial loss (psychiatric injury and injury to feelings) for disability discrimination. These awards were not flawed by misdirection in relation to causation of loss; nor were they perversely high or flawed by double counting.
As for the Claimant’s appeal, the EAT held that the tribunal had rightly rejected the Claimant’s invitation to impose a financial penalty on the First Respondent (First Greater Western Limited) under section 12A(1) of the Employment Rights Act 1996 for deliberate and repeated breaches of employment law. It was held that the tribunal had also rightly rejected the invitation of the Claimant to award aggravated damages.
Disability Discrimination: Is reliance on Occupational Health reports sufficient to prevent constructive knowledge of a disability?
In Kelly v Royal Mail Group Ltd UKEAT/0262/18/RN, Mr Kelly was a postman who had a poor attendance record generally, which had triggered the Royal Mail’s Attendance Policy on several occasions. Following two further periods of absence relating to surgery for Carpal Tunnel Syndrome the policy was triggered again, including the final AR3 stage of the policy, which allowed for a review of the whole of his attendance record. As a result the Royal Mail decided that it had lost confidence in Mr Kelly’s ability to maintain a satisfactory attendance record and accordingly dismissed him.
The tribunal held that, whilst dismissal was a harsh response, it was within the band of reasonable responses and therefore the dismissal was fair. It dismissed the allegation that this amounted to disability discrimination on the basis that Royal Mail did not know and could not reasonably be expected to know that Mr Kelly had a disability. Mr Kelly appealed on the grounds that it was perverse to conclude that it was fair to dismiss him for two absences for corrective surgery which he could not help, and for Royal Mail to rely upon earlier absences. Furthermore, it was argued that the tribunal erred in accepting that Royal Mail did not have constructive knowledge of disability because it just “rubber stamped” the Occupational Health report.
The EAT dismissed the appeal – the tribunal’s conclusion as to the fairness of the dismissal was not perverse because the policy expressly permitted earlier absences to be taken into account, and accordingly conduct in line with that policy is unlikely to be unfair. The policy applied to all absences, irrespective of fault or blame, and Royal Mail was entitled to look at the overall pattern of absence in determining whether there was a likelihood of satisfactory attendance in the future. As to disability discrimination, the EAT found Royal Mail had not simply rubber stamped the Occupational Health reports, but had actually given independent consideration to the question of disability (and arrived at the decision that carpal tunnel syndrome is not automatically a disability) though the reports themselves contained more than a bare assertion that the Claimant was not disabled. No other evidence had been supplied by Claimant or his representative, and there was nothing to suggest that the employer should seek further clarification as to whether the Claimant was disabled or not. Given all this, there was no error in the tribunal’s conclusion that Royal Mail did not have constructive knowledge of disability.
Right to Privacy: Employer can rely on material produced under police investigation
In Garamukanwa v United Kingdom [2019] 6 WLUK 109, Mr Garamukanwa and Ms Maclean worked for the same NHS hospital trust, and had had a relationship that had ended. Mr Garamukanwa had then suspected Ms Maclean had had a relationship with another member of staff, Ms Smith. According to the evidence, he then started a campaign of harassment against Ms Maclean including stalking her and sending unpleasant emails to her and her colleagues. As a result, she made a formal complaint to the police. The police investigation included them taking copies of incriminating photos he had on his mobile ‘phone. In light of the investigation, the employer decided to suspend him on full pay pending their own investigation. Whilst the police ultimately decided not to prosecute, the employer NHS Trust obtained copies of the photographs seized by the police from his mobile ‘phone. A disciplinary hearing was held and the Claimant, Mr Garamukanwa, was summarily dismissed for gross misconduct. He appealed, but the appeal was also dismissed.
A tribunal found that the decision to dismiss was within the range of reasonable responses for a reasonable employer and therefore fair. The evidence was found to justify the conclusion that the Claimant was guilty of gross misconduct: a wrongful dismissal claim also failed. In making his claim, the Claimant also raised the issue that his employer had breached his right to privacy (Article 8 of the European Convention on Human Rights – ‘ECHR’) by using the emails and other material he sent, together with the photographs from his mobile ‘phone. His contention was that they were entirely private and personal. It was this issue that reached the European Court of Human Rights, which upheld the view of the EAT, which found that the dismissal of an employee by an NHS Trust did not breach the employee’s right to privacy under Article 8 ECHR. The NHS Trust relied upon material that had been collected by, and passed on to them by, the police during their investigation into harassment allegations made against him by a colleague.
The European Court of Human Rights found that while business communications are capable of falling within the protection given to “private life” and “correspondence”, the Claimant could not have reasonably expected that any materials or communications linked to the criminal investigation would remain private, and the tribunal was fully entitled to reach this conclusion. Article 8 was therefore not engaged and the appeal dismissed. Leave to appeal to the Court of Appeal also dismissed.
Trade Unions: One-off direct offer is not unlawful inducement
In Kostal UK Ltd v Dunkley & others [2019] EWCA Civ 1009 the company had been negotiating with the employees’ union, UNITE, in respect of certain employment contract terms and conditions through collective bargaining. Section 145B of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULR(C)A) prohibits employers from circumventing this collective bargaining route and approaching the employees direct if the result is that such terms will not form part of the collective bargaining (an inducement to a ‘prohibited result’). In this instance, however, the negotiations had stalled and so the employer made two offers on two separate occasions. The offers created the prohibited result which was that the workers’ terms of employment, or any of those terms, “will not (or will no longer) be determined by collective agreement negotiated by or on behalf of the union” – i.e. circumventing the collective bargaining fifty-seven workers took the matter to the tribunal who made awards to each of them. The employer appealed.
The EAT agreed with the tribunal’s conclusion that the employer had sought to achieve a ‘prohibited result’ and dismissed the appeal. The Court of Appeal, however, took a different view of what constitutes a prohibited result. It found that a one-off direct offer did not constitute an unlawful inducement because section 145B only prohibits two types of scenarios:
- where an independent trade union is seeking to be recognised and the employer makes an offer whose sole or main purpose is to achieve the result that the workers’ terms of employment will not be determined by a collective agreement; and
- where an independent trade union is already recognised, the workers’ terms of employment are determined by collective agreement negotiated by or on behalf of the union, and the employer makes an offer whose sole or main purpose is to achieve the result that the workers’ terms of employment (as a whole), or one or more of those terms, will no longer be determined by collective agreement (i.e. the change takes the term or terms outside the scope of the collective bargaining on a permanent basis).
It distinguished these offers: where an independent trade union is recognised, the workers’ terms of employment are determined by a collective agreement negotiated by or on behalf of the union, and the employer makes an offer whose sole or main purpose is to achieve the result that one or more of the workers’ terms of employment will not, on this one occasion, be determined by the collective agreement. The appeal was successful and the claims were dismissed.
Tribunal proceedings: Extensions of time where belief reasonable
When bringing an employment tribunal claim, a claimant must complete a form ET1 and start the claim within certain prescribed time limits. In Lowri Beck Services Ltd v Brophy [2019] UKEAT 0277_18_2503, the original Claimant, Mr P Brophy, brought claims of unfair and wrongful dismissal and of disability discrimination against his employer. Mr Brophy suffers with severe dyslexia and had been helped much of his life by his brother, Michael Brophy. Due to his difficulties and the emotional impact of being dismissed for gross misconduct, the Claimant had asked his brother to help him deal with his claim. It turns out the Claimant had misunderstood the date of his actual dismissal and this was compounded by the unclear nature of the employer’s letter causing the brother to genuinely get the wrong date of dismissal. This, in turn, meant the claims were brought out of time. The tribunal decided to extend time for these reasons, and that it would be just and equitable to extend time, there being no prejudice to the employer in doing so. The employer appealed against the extension.
The EAT held that the tribunal had not erred in its findings. This mistake had been one of fact not law. The issue was whether the brother’s belief was reasonable. The tribunal had found that it was, and was therefore entitled to conclude that it had not been reasonably practicable for the claim to have been presented in time. The extension was upheld and the appeal dismissed.
Holiday Pay: Under the Working Time Directive holiday pay must include regular voluntary overtime
The decision of the EAT in Dudley Metropolitan Borough Council v Willetts and others (which we previously reported in September 2017) has recently been approved by the Court of Appeal in East of England Ambulance Service NHS Trust v Flowers & Others [2019] EWCA Civ 947. A number of ambulance crew worked ‘voluntary’ overtime. It was voluntary – they were under no obligation at all. They made a claim for unlawful deduction from wages to the employment tribunal, arguing that their voluntary overtime was not included with their ‘normal’ remuneration for the purposes of holiday pay calculation, and therefore they were owed pay.
The EAT in Dudley held that holiday pay under the Working Time Directive must include regular voluntary overtime, i.e. elements of pay that are sufficiently regular or recurring to qualify as “normal” must be included. The Court of Appeal expressly approved this decision and said that the patterns of voluntary overtime will be for the tribunals to determine, on a case-by-case basis, as to whether they are sufficiently regular and settled. Additionally, in this case, the Claimants’ contractual terms are to be found in the NHS Terms and Conditions of Service Handbook, a collective agreement popularly known as “Agenda for Change”. These required voluntary overtime to be included in the calculation of contractual holiday pay, and as Justice Soole in the EAT broke it down to be a mere question of construction, there being “no good basis to construe clause 13.9 so as to exclude overtime in the calculation of holiday pay”, which the Court of Appeal upheld.
Other news:
Sexual Harassment and Discrimination: WEC publishes report on use of NDAs in discrimination cases
In November 2018, we reported that The Women and Equalities Committee (WEC) had launched a new inquiry looking at the use of non-disclosure agreements (NDAs)where any form of harassment or discrimination has been alleged. The committee was seeking written submissions on whether there are certain types of harassment or discrimination for which NDAs are more likely to be used, whether the use of NDAs should be banned or restricted in these cases and what safeguards may be necessary to prevent their unethical use.
The WEC has now published their report on ‘The use of non-disclosure agreements in discrimination cases’. Its findings show that NDAs are used as a matter of routine to ‘cover up’ unlawful discrimination and harassment and maintain confidentiality of employers in a variety of ways, such as preventing people from making protected disclosures under whistleblowing legislation, or preventing people from explaining to a new employer why their previous job ended, or preventing them from reporting an issue to the police. Settlement agreements will often include non-disparagement provisions. This is happening, the report suggests, because of the “substantial imbalance of power” between employers and employees. Employees are often left feeling that they have little choice but to sign the agreements and agree to their stringent conditions. The report also looked at the effect and practicalities of taking such a matter to an employment tribunal. Furthermore, the report also covers the emotional and psychological damage that can be inflicted upon those feeling forced into entering into NDAs, and how being in such a situation can make moving on and finding a new job more difficult.
The reports states:
This cover-up culture has to be challenged. NDAs should not be used to silence victims of discrimination and harassment. Employers and their legal advisers should not be complicit in using NDAs to cover up allegations of unlawful acts. Discrimination at work is unlawful and employers should not have the option to cover it up through the use of NDAs. They have a duty of care to provide a safe place of work for their employees and that includes protection from unlawful discrimination. Insufficient focus and force from regulators to require employers to do more to protect employees has to change. It is in the public interest that employers tackle discrimination and harassment and that allegations of such behaviour are investigated properly and not covered up by legally sanctioned secrecy. The Government has to reset the parameters within which NDAs can be used and must address the failure of the employment tribunal system to ensure all employees who have experienced discrimination have a meaningful route of legal redress.
The WEC suggest the Government follow these key recommendations:
- ensure that NDAs cannot prevent legitimate discussion of allegations of unlawful discrimination or harassment, and stop their use to cover up allegations of unlawful discrimination, while still protecting the rights of victims to be able to make the choice to move on with their lives;
- require standard, plain English confidentiality, non-derogatory and similar clauses where these are used in settlement agreements, and ensure that such clauses are suitably specific about what information can and cannot be shared and with whom;
- strengthen corporate governance requirements to require employers to meet their responsibilities to protect those they employ from discrimination and harassment; and
- require named senior managers at board level or similar to oversee anti-discrimination and harassment policies and procedures and the use of NDAs in discrimination and harassment cases.
They also renewed their previous calls (which have been rejected) for the Government to:
- place a mandatory duty on employers to protect workers from harassment and victimisation in the workplace; and
- urgently improve the remedies that can be awarded by employment tribunals as well as the costs regime to reduce disincentives to taking a case forward. Tribunals should be able to award punitive damages, and awards for the non-financial impact of discrimination should be increased significantly.
Health & Safety: Employers should support victims of domestic abuse
The figures on domestic abuse are shocking:
Two women a week are killed by a partner or former partner. One in four women and one in six men will experience domestic abuse in their lifetime, which can range from coercive behaviour to murder. That means we are all likely to know or work with someone suffering from it right now. The damage to people’s mental and physical well being is huge, as is the cost to the economy, calculated by government to be £66 billion a year, writes Iqbal Wahhab OBE in the Independent.
Over 270 companies and public sector businesses have joined the Employers Initiative on Domestic Abuse (EIDA) (https://eida.org.uk/) to help put a stop to this. The EIDA is a network of employers who have set up this organisation to work collectively to end domestic abuse, and support and protect domestic abuse victims in their workplaces. The EIDA website invites you to join them, there is no fee, and provides an employer’s toolkit, as well as other resources to help employers help their employees in crisis. Among the suggestions are for employers to introduce policies and educate staff to identify, support and signpost victims.
Health & Safety: IES publishes report regarding support for epileptic workers
One in 100 people in the UK suffer with Epilepsy but they are more than twice as likely as non-sufferers to be unemployed. The Institute for Employment Studies (IES) was commissioned by Epilepsy Action to conduct research to explore the factors that contribute to people with epilepsy being disadvantaged at work, and to identify what good employment support should look like. The report ‘Employment support for people with epilepsy – Qualitative research to identify what good employment support for people with epilepsy should look like’ has now been published.
The study revealed both a lack of knowledge on the part of employers about the condition, particularly its fluctuating nature, and the fear held by epilepsy sufferers that they would suffer discrimination in the workplace. IES’s recommendations include a personalised online toolkit – covering disclosure, health and safety, reasonable adjustments and other common concerns – could guide employers and employees in their conversations. Checklists and ‘job carving’ would help employers to assess employees’ capacity and fit with job tasks, and to make adjustments. These are areas that Epilepsy Action can address.The report also highlights the need for improved access to support services to empower people with epilepsy in their interactions with employers.
Data Protection: One year on since implementation of GDPR and Data Protection Act 2018
Can you believe it’s been a year since we all scrambled to get our policies, permissions and records straight? It has been a big change to the regulatory landscape and privacy is now arguably much better understood and appreciated.
The Information Commissioner, Elizabeth Denman, explains:
People have woken up to the new rights the GDPR delivers, with increased protection for the public and additional obligations for organisations. But there is much more still to do to build the public’s trust and confidence. The focus for the second year of the GDPR must be beyond baseline compliance. Instead organisations need to shift their focus to accountability with a real, evidenced understanding of the risks to individuals and how those risks should be mitigated.
With this in mind, the ICO has published a report detailing their work since 25 May 2018, looking back at what has been learnt over the last year, describes some of the work undertaken by the ICO to deliver the goals set out in its Information Rights Strategic Plan (such as supporting the public and organisations, and using its new enforcement and investigation powers). The report also looks at the ICO’s attempts to stay relevant and foster innovation to be an effective regulator both at home and abroad.
Parental Leave: UK ranks near bottom for family friendliness
The BBC recently reported that the UK is one of the worst countries in Europe for paid parental leave, according to UNICEF. Researchers for UNICEF looked 31 European countries and ranked them according to their paid parental leave and affordable childcare to assess how family-friendly they are. The UK came in at a disappointing twenty-eighth, followed only by Cyprus, Greece and Switzerland. Research revealed that UK parents were among the most likely to state that the high cost of childcare was the key factor dissuading them from using it. And yet many nurseries close or have to request top up fees from parents because their running costs are so high (even though childcare is not well paid) and the government’s ‘free childcare’ provision does not meet the actual cost of providing it.
Perhaps unsurprisingly, Sweden and Norway ranked first and second, because they have more progressive paid parental leave policies, with parents being able to split parental leave jointly and family time being much more important socially. These countries offered the equivalent of 35 and 45 weeks of paid leave respectively, while Estonia offers 85 weeks’ paid leave.
UNICEF says,
Family-friendly policies strengthen the bond between parents and their children, which is critical for the development of families and socially cohesive societies. UNICEF advocates for at least six months of paid leave for parents, and for universal access to quality, affordable childcare from birth to children’s entry into the first grade of school.
Further Information
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
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Employment Law Newsletter – March 2019
Cases:
- TUPE: Dismissal due to difficult working relationship may be automatically unfair
- Contract: When ‘Bad Leaver’ provisions may be considered a penalty or an unlawful deduction from wages
- Employment Status: Is a quarterly ‘exclusivity’ payment evidence that an individual is an employee?
- Worker Status: Pimlico plumber ‘worker’ loses holiday pay claim
- Equality Act: Is it unfair to send woman on maternity leave an important email she cannot access?
- Indirect Discrimination: Justification of rule more important than application of rule to individual
Other news:
- Data Protection: ICO and Insolvency Service work together to disqualify directors in new record
- BREXIT: ICO website contains SME Brexit preparation tools
- Data Protection: Vote Leave Ltd fined £40,000 by ICO
- Immigration: Seasonal workers pilot opens
- Modern Slavery: Annual anti-slavery audit will result in naming and shaming the non-compliers
- Holiday Pay: BEIS publishes guidance and online calculator for workers without fixed hours/pay
- Wages: National Minimum Wage and National Living Wage set to increase from 1 April
Cases:
TUPE: Can a dismissal due to difficult working relationship be automatically unfair?
In Hare Wines Ltd v Kaur [2019] EWCA Civ 216 the question before the Court of Appeal was whether the Claimant’s dismissal for purely ‘personal reasons’, was a sufficient reason to prevent the dismissal from being automatically unfair as it related to a TUPE transfer. In this case, Mrs Kaur was a cashier for a wine wholesaler, which had been run by several different businesses during the time she had worked there, with common directors/shareholders. In 2014, the business was transferred under TUPE to Hare Wines Ltd. Mrs Kaur and Mr Chatha were colleagues with a strained working relationship. Mr Chatha became a director of Hare Wines Ltd. On the day of the transfer, Mrs Kaur was dismissed, and all the rest of the employees transferred under TUPE to Hare Wines Ltd. Mrs Kaur claimed this was automatically unfair as it was related to the transfer, and the tribunal agreed.
Hare Wines Ltd argued that Mrs Kaur had objected to the transfer because she did not wish to work with Mr Chatha, who was to become a director. However, the tribunal held that this was not the case, and that the real reason was that the business did not want her because it may have continuing difficulties between the individuals. On appeal to the EAT and then the Court of Appeal, the tribunal’s finding that she had not objected was upheld and that the reason for the dismissal was not that she had been dismissed because of her difficulties with Mr Chatha with the transfer being coincidental, it was that the employer did not want her because she and Mr Chatha did not get on. This was the principal reason. The relationship had been strained for some time and she had not been dismissed until the transfer was to happen, therefore the two were linked. The Court of Appeal noted that dismissals for economic, technical or organisational (aka ‘ETO’) reasons connected with transfers can be fair, but the law does not recognise any category of ‘personal’ reason for dismissal as preventing a transfer-related dismissal from being automatically unfair.
Contract: When ‘Bad Leaver’ provisions may be considered a penalty or an unlawful deduction from wages
In Nosworthy v Instinctif Partners Ltd UKEAT/0100/18, Miss Nosworthy had entered in to a Share Purchase Agreement and Articles of Association with the company, which contained some common bad leaver conditions. The conditions meant that a shareholder who is also an employee who voluntarily resigns is considered to be a bad leaver . In this case, the bad leaver provisions meant that when Miss Nosworthy resigned she was forced to forfeit deferred earn-out shares and loan notes – i.e. transfer her shares – with the value of the shares being determined at the acquisition cost (which was £143 for her 2% share). Miss Nosworthy claimed this forced transfer was a contract connected with employment and therefore could be considered to be unconscionable, a penalty or an unlawful deduction from wages
The tribunal disagreed, and this finding was upheld by the EAT. The criteria for setting aside an agreement as unconscionable were not satisfied – there had been no serious disadvantage. It was not a penalty as a result of a breach of contract, because it was a term of the Articles of Association which applied to any bad leaver, regardless of breach, and was not a breach of contract. Furthermore, the company’s remuneration committee, which had the power to reclassify her as a good leaver, had not failed to exercise its discretion in good faith because there were no exceptional circumstances for it to take into account. Lastly, it was not an unlawful deduction from wages, because the definition only covers payments made in respect of her capacity as a worker, whereas the shares were provided to her as a shareholder.
Employment Status: Is a quarterly ‘exclusivity’ payment evidence that an individual is an employee?
In Exmoor Ales Ltd & Another v Herriot UKEAT/0075/18/RN theEAT Mrs Herriot had provided accountancy services for Exmoor Ales, a brewery, for nearly three decades, submitting invoices from her partnership. Since 2011, the brewery had paid her £1,000 each quarter, which Mrs Herriot claimed was an exclusivity payment, but which the respondents denied. In 2017 Mrs Herriot brought claims against the brewery just before her work relationship with it ended. The claims were for unfair dismissal, age discrimination, holiday pay, failure to provide a statement of written particulars of employment, harassment and victimisation.
The tribunal found, on the evidence, that the quarterly payment did indeed change the nature of the relationship from that point onwards and that she did in fact, stop working for other clients. The brewery had also given her allocated seating in their premises, she was fully integrated into their business, and exercised a high level of control over her whilst at work. It was also noted that there was mutuality of obligations between the parties from April 2011 onwards, and she had no right to appoint a substitute. The tribunal therefore held that until that time, Mrs Herriot had been an independent contractor providing accountancy services to the brewery but after the quarterly payments started, she was in actual fact an employee.
The brewery appealed arguing that the tribunal had not looked at all the relevant factors on employment status, including her tax arrangements, and that she had prepared employment contracts for other staff but not herself, and was not a member of the employee share scheme. These were rejected by the EAT, however, because the tribunal had considered these elements but found the factors highlighted by it had overridden those identified by the Respondents. In this instance, the quarterly exclusivity payment had been an influencing factor although in reality it was the effect it had on their respective behaviours that led the tribunal and EAT to find her to be a de facto employee.Worker Status: Pimlico plumber ‘worker’ loses holiday pay claim
Last year the Supreme Court ruled in Pimlico Plumbers Ltd & Another v Smith that the plumbers had been employed by Pimlico Plumbers as workers rather than being hired as independent contractors. As workers, this meant they were entitled to some basic employment rights such as the right to be paid the national minimum wage and holiday pay. At the end of his successful seven year battle with Pimlico Plumbers, Mr Smith began proceedings in the Croydon employment tribunal for backdated holiday pay. However, the tribunal ruled that he had not filed his claim quickly enough – the regulations state that claims for missed pay should be filed within 3 months of each holiday period, dating back to 2005. His claim amounted to £74,000. He is going to appeal this decision because he did not know he was entitled to paid leave while he was employed by Pimlico Plumbers so did not bring a claim until after his contract was terminated in May 2011.
Equality Act: Is it unfair to send woman on maternity leave an important email she cannot access?
In South West Yorkshire Partnership NHS Foundation Trust v Jackson UKEAT/0090/18/BA the claimant was on maternity leave when she became part of a number of staff at risk of redundancy who were then sent an email by the HR department to their work email addresses, which the claimant could not access, setting out redeployment opportunities. She was not able to open the email for several days but this in itself did not cause her substantial harm. However, it raised a legitimate concern that such behaviour was unfavourable treatment (s.18(4) of the Equality Act) because she was exercising her right to take maternity leave, and it is on this ground that she made a claim.
The tribunal upheld her claim. However, the EAT found that the tribunal had erred in its approach to the causation test. Although the unfavourable treatment would not have happened “but for” the fact that the Claimant was on maternity leave, the tribunal had not considered whether this was the “reason why” she had been treated unfavourably. There was no finding by the tribunal as to why the Claimant was not able to access her emails, as she had in fact attended a meeting a few days before despite being on maternity leave.
Mr Justice Shanks said, the “ET must ask itself the standard “reason why” question in relation to why the unfavourable treatment took place and that it is not sufficient for the “but for” test to be satisfied for there to be a finding of discrimination under section 18.” He went on to say that it did not seem as if the tribunal had found that the characteristic of being on maternity leave had been on anyone’s mind, nor had the tribunal decided that an inherently discriminatory rule had been applied in this case. It seems to have been pure administrative error and therefore the test used by the tribunal was that ‘but for being on maternity leave, the Claimant would not have been disadvantaged’, which was not sufficient for a finding of discrimination. As a result the case was remitted back to the tribunal for further findings.
Contract: Suspending an employee does not always breach the implied term of trust and confidence
In The Mayor and Burgesses of the London Borough of Lambeth v Agoreyo [2019] EWCA Civ 322 a primary school teacher was accused of using excessive force with two pupils with special educational needs, and suspended pending investigation as a result. The teacher, Ms Agoreyo, resigned the same day. She claimed that the suspension had been a knee-jerk reaction and that an investigation did not require suspension. The suspension was a repudiatory breach of contract – a breach of the implied term of mutual trust and confidence between them, and she was entitled to resign and claim constructive dismissal.
At first instance, the County Court found that the school had reasonable and proper cause for her suspension. The claim was dismissed. Ms Agoreyo appealed. The High Court allowed the appeal on the basis that suspension should not be the default option – an individual should be suspended only if there is no reasonable alternative. The school had said the suspension was a neutral act but the High Court disagreed and said that it is never a neutral act. Ms Agoreyo’s resignation letter neither negated nor undermined the case on breach of the implied term as to trust and confidence.
On further appeal however, the Court of Appeal agreed with the County Court, and held there was no breach of trust and confidence. It found the High Court had erred in its test of whether it was necessaryto suspend was setting the bar too high and the correct legal test was whether the school had had reasonable and proper cause to suspend Ms Agoreyo. The County Court judge was entitled to hold that it did and Ms Agoreyo’s claim that her suspension was a breach of contract failed.Indirect Discrimination: Justification of rule more important than application of rule to individual
In The City of Oxford Bus Services Limited t/a Oxford Bus Company v Harvey UKEAT/0171/18/JOJ a bus company had instituted a rule in the rostering system that bus drivers had to work 5 out of 7 days, including Saturdays or Sundays. Mr Harvey was a Seventh Day Adventist who asked not to work between sunset on Friday and sunset on Saturday so that he could observe the Sabbath. The bus company had given him a service that was able to take this into account but it was not a permanent arrangement and so he subsequently had to swap shifts or call in absent from work on the days when he was required to work a shift on Friday evening or Saturday daytime. They had also offered him flexible working but in the meantime he had brought a claim of indirect discrimination on the grounds of religion or belief.
The bus company argued that it feared that if it agreed to this as a permanent arrangement, more drivers would ask for time off for other religious reasons, particularly events and festivals, and this might result in industrial unrest. At tribunal it was accepted that the bus company’s working arrangements imposed a ‘provision, criterion or practice’ (“PCP”) that placed Mr Harvey at a disadvantage. So, the question then was, whether the PCP was a proportionate means of achieving a legitimate aim. The tribunal found that the bus company had established legitimate aims of ensuring efficiency, fairness to all staff, and recruitment and retention. In upholding Mr Harvey’s claim, however, the tribunal ruled that the PCP was not justified becausethere was insufficient evidence to support one of the legitimate aims – maintaining a ‘harmonious workforce’.
On appeal to the EAT the decision was overturned the decision. It was incorrect of the tribunal to focus on the particular application of the rule on the claimant rather than the general justification for the rule. The tribunal had recognised that the bus company’s problems arose not from granting the Mr Harvey’s request, but from granting many such requests, and in doing so meant it had failed to balance the general aims of the bus company with the potentially discriminatory impact of the rule. The judge remitted the case back to the original tribunal to reconsider this issue.Other news:
Data Protection: ICO and Insolvency Service work together to disqualify directors in new record
The Information Commissioner’s Office (ICO) has carried out investigations into nuisance marketing which, by working with the Insolvency Service, has led to 16 company directors being banned from running a company for more than 100 years in total. One of the worst offenders was Richard Jones who has been barred from being a company director for eight years after his two companies, Your Money Rights Ltd and Miss-Sold Products UK Ltd were responsible for 220 million automated nuisance calls, most of which were in respect of PPI claims. The companies’ breaches resulted in total fines of £700,000 in 2017, which Mr Jones then tried to avoid by applying to wind up the companies. This was blocked by the ICO which then referred the case on to the Insolvency Service.
New legislation which came into force in December 2018 means that the ICO now has powers to make company directors and other company officers personally liable for the fines imposed for illegal marketing.
BREXIT: ICO website contains SME Brexit preparation tools
Who knows what the next few weeks have in store, but that’s not very helpful for businesses. Whilst most businesses may well be more prepared than the government, the ICO has produced guidance and practical tools to help organisations prepare in terms of their data, including: Data Protection and Brexit Law enforcement processing: Five steps to take, Data protection in the event of a no-deal Brexit, aimed at UK based businesses or organisations to which the GDPR or Part 3 of the Data Protection Act 2018 currently applies to their processing of personal data.
Data Protection: Vote Leave Ltd fined £40,000 by ICO
Vote Leave Limited has recently been fined £40,000 by the Information Commissioner’s Office (ICO) for sending out thousands of unsolicited text messages run up to the 2016 EU referendum. An ICO investigation found that Vote Leave sent 196,154 text messages promoting the aims of the Leave campaign with the majority containing a link to its website. Vote Leave claimed the contact information it had used to message people was obtained from enquiries which had come through their website; from individuals who had responded via text to promotional leaflets; and from entrants to a football competition. However, the organisation said that following the conclusion of the referendum campaign it had deleted evidence of the consent relied upon to send the messages. Also deleted were details of the phone numbers the messages were sent from, the volume of messages sent, and the volume of messages received. Being unable to provide evidence that the people who received the messages had given their consent (a key requirement of electronic marketing law) made them liable for this fine.
This latest fine is part of the ICO’s ongoing investigation into the use of data in political campaigns. As a result of the investigation the ICO has taken action against a number of different organisations engaged in campaigning for breaches of direct marketing and data protection laws.
Immigration: Seasonal workers’ pilot opens
In September 2018, the Home Secretary and Environment Secretary announced that, having listened to farmers, they were introducing a nationwide pilot scheme seasonal workers to bring seasonal migrant workers to UK farms. The pilot opened on 6 March meaning that UK fruit and vegetable farmers will be able to employ migrant workers for seasonal work for up to 6 months. Subject to recruitment and visa application processes, the pilot, which runs until the end of December 2020, will allow up to 2,500 workers from outside the EU into the UK each year. Concordia and Pro-Force are the two scheme operators who have been licensed to manage the pilot. It is their responsibility to identify suitable workers who they will then match to UK farmers, as well as ensuring the welfare of the workers whilst they are in the UK.
The aim is to test the effectiveness of the immigration system at alleviating labour shortages during peak production periods.The pilot will be reviewed before any decisions are taken on running a future scheme.
Modern Slavery: Annual anti-slavery audit will result in naming and shaming the non-compliers
In October 2018, the Home Office was moved to action following pressure from numerous groups frustrated by what they see as ‘blatant compliance failures’. It began with the Home Office writing directly to the chief executives of 17,000 businesses telling them to open up about modern slavery in their supply chains, or risk being named as in breach of the Modern Slavery Act. The letter gave the companies a grace period to comply – which ends on 31 March 2019.
Those businesses which do not comply by the deadline date will be “named and shamed” in a public report. The ‘naming and shaming’ is seen as a prelude to strengthening the reporting requirements under the legislation and, possibly, introducing sanctions for non-compliance.
The government reports that:
Businesses with a turnover of more than £36 million must publish annual transparency statements, known as a Modern Slavery Statement, setting out what they are doing to stop modern slavery and forced labour practices occurring in their business and supply chains. At the moment, it is estimated that 60% of companies in scope have published a statement. Whilst there are many examples of good practice, some of these statements are poor in quality or fail to even meet the basic legal requirements.
Holiday Pay: BEIS publishes guidance and online calculator for workers without fixed hours/pay
The Department for Business, Energy and Industrial Strategy (BEIS) has published guidance and an online calculator on how to calculate holiday pay for workers whose hours or pay are not fixed. This guidance is intended to help employers pay the correct amount of holiday pay for all their workers.
In simple terms, the Working Time Regulations 1998 mean that almost all workers are legally entitled to 5.6 weeks’ paid holiday per year, with the pay being calculated based on the amount of hours they work and how they are paid for those hours. For workers who do not work fixed or regular hours, and therefore do not receive the same amount of pay each week, month or other pay period, it can be more complicated. This guidance helps employers calculate holiday for such workers, using the holiday pay reference period (a worker’s previous 12 week paid period) and gives examples of what to do if you don’t have 12 weeks of data, when the reference period starts, what the definition of week is, etc.
Wages: National Minimum Wage and National Living Wage set to increase from 1 April
In the Budget 2018, in response to the Low Pay Commission’s recommendations the Chancellor, Philip Hammond, announced new National Minimum/Living Wageincreases from 1 April 2019 as follows:
- from £7.83 to £8.21 for workers aged 25 and over (the National Living Wage)
- from £7.38 to £7.70 for 21-24 year olds
- from £5.90 to £6.15 for 18-20 year olds
- from £4.20 to £4.35 for 16-17 year olds
- from £3.70 to £3.90 for apprentices aged under 19 or in the first year of their apprenticeship.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
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Employment Law Newsletter – February 2019
Cases:
- Equal Pay: Female retail staff can compare themselves to male distribution workers
- Direct Discrimination: Claimant must provide sufficient evidence to make out case
- Dismissal: Contractual duty of confidentiality
- Tribunals: The principle of open justice versus the individual’s right to privacy
- Working Time Directive: AG says national law must require employers keep records of actual time worked by workers
Other news:
- ACAS: New Age Discrimination Guidance
- Pregnancy and maternity discrimination: Consultation on proposals to extend redundancy protection for women and new parents
- Gender Pay Gap: GEO publish research on outcome of 2018 Gender Pay Gap reporting
- Information Commissioner: Recent enforcement action and warning for directors
Equal Pay: Female retail staff can compare themselves to male distribution workers
In our January round-up we reported that the decision in the case of Asda Stores Ltd v Brierley and others [2019] EWCA Civ 44 that was heard in the Court of Appeal in October was awaited. The judgement was published on 31 January 2019 and the Court upheld the prior decisions of the employment tribunal and the EAT, and dismissed the appeal. The claimant group comprised mostly female retail employees in the supermarket and they were attempting to use the mainly male group of offsite distribution depot employees as their comparator for the purposes of their equal pay claim. In order to bring an equal pay claim, a claimant must identify a comparator of the opposite sex performing equal work. There are three categories of equal work: “like work”, “work rated as equivalent” (under a job evaluation scheme) and “work of equal value”. Both the claimant and comparator must be working for the same employer or associated employers, and must be at the same establishment or at different establishment to which common terms and conditions apply. “Common terms” does not mean identical terms but they may be “broadly similar” (British Coal v Smith [1996] ICR 515 (HL)).
The claimant group acknowledged that they did not work in the same establishments as any of their comparators, because Asda’s stores and its depots were entirely separate; but they claimed that “common terms of employment” applied at both, either generally or as between themselves and their comparators, so that they could rely on s 79(4)(c) Equality Act 2010 (or that they were in the same employment as defined in s 1(6) the Equal Pay Act 1970). Alternatively, the claimants relied on the direct effect of Article 157 of the Treaty on the Functioning of the European Union which provides that: “Each Member State shall ensure that the principle of equal pay for male and female workers for equal work or work of equal value is applied”. They argued that comparison was possible in any case where there was a “single source” for the terms of employment of the claimant and the comparator.
The Court of Appeal held that:
1) For both retailworkers and distribution workers, Asda applied common terms and conditions “wherever they work“. The effect of the case-law, and of North v Dumfries and Galloway Council [2013] ICR 993 in particular, was that the phrase “wherever they work” extends even to the hypothetical situation of a workplace where they would never, in practice, work because the nature of its operations is so different. So, even though the two groups of employees worked at separate establishments – meaning no one from either establishment could or would have worked at the other – a comparison could nonetheless be made because Asda observed “broadly common terms and conditions” for both groups across both establishments. When considering this point, the Court of Appeal said the tribunal had muddled (albeit still arrived at the correct conclusion) considering whether there were broadly similar terms between retail workers at one site and distribution workers at the other site. Lord Justice Underhill said this was the wrong exercise and that the issue was, would a distribution worker be on broadly the same terms regardless of which site he worked at?
2) There was a “single source” for the terms of employment, as the Asda Executive Board was ultimately responsible for pay across the two groups, and therefore was capable of rectifying the inequality and restoring equal treatment. The Courtwas not required to decide whether the relevant EU provision had direct effect at this time.
This matter is a long way from over, however, as it can now proceed to the next stage in order to determine whether the work of the two groups was of equal value. Asda has a lot riding on this (claims potentially worth over £100m against them) so they are working every angle they can.
Direct Discrimination: Claimant must provide sufficient evidence to make out case
In Efobi v Royal Mail Group Ltd [2019] EWCA Civ 18 Mr Efobi was a black Nigerian who, although employed as a postman by Royal Mail, failed to secure a different role in management or IT, despite many attempts and his graduate and post-graduate qualifications in Information Systems and Forensic Accounting. He brought a claim of direct discrimination against Royal Mail, and represented himself in the proceedings.
The issue revolves around:
- Section 13(1) of the Equality Act 2010, which requires a comparison between the claimant and either an actual or a hypothetical comparator in order to establish less favourable treatment of the claimant.
- Section 136 of the Equality Act 2010, which deals with the burden of proof:
(2) If there are facts from which the court could decide, in the absence of any other explanation, that a person (A) contravened the provision concerned, the court must hold that the contravention occurred. (3) But subsection (2) does not apply if A shows that A did not contravene the provision.
First, the burden is on the employee to establish facts from which a tribunal could conclude on the balance of probabilities, absent any explanation, that the alleged discrimination had occurred. At that stage the tribunal must leave out of account the employer’s explanation for the treatment. If that burden is discharged, the onus shifts to the employer to give an explanation for the alleged discriminatory treatment and to satisfy the tribunal that it was not tainted by a relevant proscribed characteristic. If he does not discharge that burden, the tribunal must find the case proved.
Royal Mail did not provide any evidence about the identity or qualifications of the successful candidates; and Mr Efobi did not pursue this through discovery. The tribunal followed s.136 and found that Mr Efobi had not provided facts from which discrimination could be inferred, and the claim had to fail.
At appeal, the EAT thought the tribunal should have considered whether it should draw inferences from the Royal Mail’s reticence to provide information about the successful candidates. The Court of Appeal disagreed. The simple case was that the burden was on Mr Efobi, as claimant, to prove his case at the first stage – to provide sufficient information to the tribunal to enable it to identify the characteristics of the proposed comparator, from which the case of less favourable treatment could be made out. It was not up to the tribunal to make inferences. The claimant had failed to prove his case and the appeal was dismissed.
Dismissal: Contractual duty of confidentiality
Large law firm, Linklaters, has just won an interim injunction against their former Director of Business Development and Marketing (Linklaters LLP v Mellish [2019] EWHC 177 (QB)). In June 2018, he had been given 6 months’ notice to terminate his contract and the firm confirmed he would be paid his contractual entitlements and a substantial additional ex gratia sum. In his employment contract there was an express obligation of confidentiality which the letter of termination expressly stated was to persist after his employment came to an end. In January 2019, having received his final payments, Mr Mellish emailed the Senior and Managing Partners to express his dissatisfaction that the termination of his employment at his age was effectively the end of his career, and stated that he intended to “share my impressions of the current culture at Linklaters” with particular reference to what he called “the ongoing struggle Linklaters has with women in the workplace“. He said that, to that end, he would be giving “interviews” in the first two weeks of February. He gave specific examples and said his motive was to allow Linklaters to prepare for the questions from the media.
The firm claim the information to which he referred is confidential information relating to partners and/or employees of the firm, and therefore falls within the scope of his ongoing contractual confidentiality obligation. The claimants’ application was for an injunction to restrain disclosure of four specific areas of information. The claimants did not seek to restrain the defendant from publicising in general terms his “impressions of the current culture at Linklaters“.
The question before the court was whether Mr Mellish’sduty of confidentiality outweighed the public interest in the publication of information on the employer’s current culture and the position of women in the workplace. It was accepted that the first and fundamental requirement for granting an injunction is for the claimants to satisfy the Court that there was a real risk of publication which was sufficient to justify the interference with the defendant’s freedom of expression by granting the injunction. The Court held this to have been proved, and further that it was satisfied that there was a high likelihood that Linklaters would succeed at trial in showing that publication should not be allowed. The information fell firmly within the contractual duty of confidence, it was not in the public domain, and the interests of the third parties also bolstered the case. Justice Warby said that while there may be a legitimate public interest in organisations performing their moral and social duties to their staff, that did not override the legitimate interest in maintaining confidentiality. The defendant was also ordered to disclose the identity of any people to whom he had disclosed all or any part of the information at issue with a view to publication.
Tribunals: The principle of open justice versus the individual’s right to privacy
In Ameyaw v PricewaterhouseCoopers Services Ltd UKEAT/0244/18 Miss Ameyaw brought a number of claims in the employment tribunal against her former employer PricewaterhouseCoopers Services Ltd (PWC). It seems from the beginning she wanted the matters to be dealt with in private. In any event, PWC applied to strike out her claims following her alleged “scandalous and vexatious conduct” at a preliminary hearing. The strike-out application was heard in public, and was dismissed. The judgment, with full written reasons, was entered on the public register of tribunal judgments including online on the ‘Gov.uk’ website. At a final hearing Miss Ameyaw’s claims were dismissed, following which she applied for an order that this judgment should not be entered on the register, the strike-out judgment (which was published a year earlier) should be removed; and/or that she should be anonymised in both judgments.
Her application was refused by the tribunal judge on the basis that there was no discretion not to publish a tribunal judgment on the register and that rule 50 of the Employment Tribunal Rules of Procedure 2013 did not provide any basis to override the principle of open justice. Miss Ameyaw appealed on the ground that the online publication of the strike-out judgment (only, the final hearing judgment was not published, reason unknown) breached her right to privacy under Article 8 of the ECHR.
The EAT upheld the tribunal’s decision – the tribunal had been entitled to find that in this case the claimant’s right to privacy under Article 8 did not outweigh the principle of open justice and the right to a free trial and freedom of expression under Articles 6 and 10 of the ECHR. Miss Ameyaw’s claim that the online publication of the judgment had caused “long lasting damage to [my] personal and professional reputation resulting in significant losses” and prevented her securing new employment was not sufficient to outweigh the fundamental principles and rights upon which the employment tribunal system is executed.
Working Time Directive: AG says national law must require employers keep records of actual time worked by workers
Advocate General Pitruzzella has given his opinion in a preliminary ruling in the CJEU in Federacion de Servicios de Comisiones Obreras (CCOO) v Deutsche Bank SAE (Case C‑55/18). The case is a group action brought by trade union CCOO against Deutsche Bank in the National High Court in Spain. CCOO are seeking a judgment that the bank was under an obligation to record the actual daily working time of its employees in order to ensure that the working times laid down in legislation and under collective agreements are actually adhered to. Deutsche Bank, like many other employers no doubt, uses an Absences Calendar which records absence for full working days such as annual leave or sick leave, but actual hours worked are not recorded.
Attorney General Pitruzzella (whose opinion as AG is not binding, but is usually followed by the CJEU) stated that in order to comply with duties under the Working Time Directive, national law must require employers keep records of actual time worked by workers (i.e. the Member States must, in implementing the directive, ‘take the measures necessary’ to ensure that workers enjoy the rights which the directive guarantees), and where there are not mechanisms to do so implemented by the legal system of a Member State, then it undermines the effectiveness of the directive.He commented, at paragraph 89:
In my opinion, it follows from all the foregoing considerations that national legislation which does not impose any obligation upon undertakings to introduce a system to record the daily working time of all employees is inconsistent with European Union law. It nevertheless remains for the referring court to ascertain whether the national provisions under discussion in the main proceedings can in fact be interpreted in a manner consistent with the provisions of Directive 2003/88 at issue and Article 31(2) of the Charter.
Other news:
ACAS: New Age Discrimination Guidance
Under the Equality Act 2010, age is one of the nine special areas of life guarded as what is known as protected characteristics. ACAS has published new Guidance on Age Discrimination to help employers and line managers manage an age diverse workforce, prevent unfair treatment at work, and eradicate bias against older and younger workers.
It includes:
- a document entitled ‘Key points for the Workplace’ which is aimed at employers, managers, HR professionals, employees, employee/trade union representatives and job applicants alike, steps to take to prevent age discrimination happening in the workplace, gives examples of how age discrimination might still occur, and demonstrates how age discrimination should be dealt with if it does happen;
- a ‘top ten obligations’ factsheet for employers to help reduce the chances of age discrimination occurring; and
- a’ top ten myths’ sheet in which they dispel myths about age as it relates to the workforce.
Pregnancy and maternity discrimination: Consultation on proposals to extend redundancy protection for women and new parents
Following recent reports such as the Taylor Review and the Women and Equalities Select Committee’s report on Pregnancy and Maternity Discrimination,on 25 January 2019, BEIS opened a consultation seeking views on several matters which seek to improve the rights of women and new parents in the workplace. Evidence has shown that new mothers are being forced out of work when they seek to return, and so the Government is seeking views on whether an extended period of additional protection against redundancy, might be the best way to address this issue. They seek views on:
- proposals to extend the redundancy protection of new mothers from the date they notify their employer in writing of their pregnancy to six months after their return from maternity leave; and
- whether this protection should be extended to others taking similar leave, such as adoption leave and shared parental leave.
The consultation closed on 5 April 2019.
Gender Pay Gap: GEO publish research on outcome of 2018 Gender Pay Gap reporting
The Government Equalities Office (GEO) has published a report ‘Employers’ understanding of the Gender Pay Gap and actions to tackle it’. The report used data gathered from a 2017 survey about employers’ awareness, understanding and actions regarding the gender pay gap (GPG), which was then compared against a follow-up 218 survey. The 2018 survey also included employers’ understanding of the gender pay gap, their experiences with compliance and the actions they were taking to close the gap.
Some of the results are promising:
- 82% of respondentsbelieved they had a good understanding of what the GPG is and how it is calculated, up from 48% in 2017;
- There was an increase from 63% (2017) to 88% (2018) in the proportion of respondents who believed they had a good understanding of the differences between “closing the gender pay gap” and “ensuring equal pay between men and women“;
- the proportion of employers that had developed a GPG strategy had increased from 21% in 2017 to 34% in 2018;
- over half of employers with a GPG of over 20% had come up with a formal strategy to reduce it, including measures such as the promotion of flexible working and shared childcare, cultural changes within firms and gender-specific recruitment strategies.
Unfortunately, there are still some areas that require improvement, such as 16% of respondents felt they had a reasonable understanding of what the GPG is but were unsure on the specifics, while the remaining 2% said they had a limited understanding. The overall difficulty of compliance showed mixed results: 35% found it very or fairly straightforward, while 30% found it very or fairly difficult and 33% believed they would have benefitted from additional guidance. Overall, this is promising feedback but just shows that there is still work to be done across the board, and of course, this information only represents the largest employers.
Information Commissioner: Recent enforcement action and warning for directors
The ICO has published details of one of its latest enforcement actions against NWR Limited, which is a supplier and fitter of renewable energy products, based in Kent. The company is said to have made 827,883 calls to numbers registered with the Telephone Preference Service (TPS) between May 2016 and May 2018. Companies are prohibited from calling people (direct marketing) registered with the TPS without that person’s consent. The Information Commissioner issued an enforcement notice to NWR Limited to compel it to stop its illegal marketing activity. It appears they were not using the correct data, have not purchased a TPS licence and the staff making the telephone calls were not properly introducing themselves and explaining the company about which they were calling.
In December, the ICO also issued a monetary penalty of £200,000 and an enforcement notice to ‘Tax Returned’, a London-based firm which sent out 14.8m unlawful SMS marketing messages to subscribers between July 2016 and October 2017. These messages were sent without valid consent having been obtained using a third party service provider. Tax Returned should have taken reasonable steps to make sure the data they obtained complied with the Privacy and Electronic Communications Regulation (PECR), which includes getting specific, prior consent from people receiving the messages. Some of the consents were obtained through generic third party consent found on privacy policies of certain websites but the ICO found that the wording of the policies was not clear enough and that neither Tax Returned nor the third party service provider were listed on most of those privacy policies.
On 17 December 2018, ‘Director’s Liability’ was introduced through amendments to the Privacy and Electronic Communication Regulations 2003. The new law allows the ICO to serve monetary penalties, of up to £500,000, on directors and senior officers of companies held responsible for making nuisance calls or sending nuisance messages or emails.
Lessons to be learned here are check you are using the correct data and that it has been obtained lawfully, and this includes if you contract with a third party to carry out your marketing activities.
Further Information:
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: advice@dixcartlegal.com.
