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Employment Law Case Update – March 2024

  • Employment,

  • 24th March 2024

Employment Law

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

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

Unfair Dismissal: Band of Reasonable responses

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The EAT held that:

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

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

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Further Information:

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

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

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Employment Law General Update – November 2023

  • Employment,

  • 22nd November 2023

Employment Law

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

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

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

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

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

Retained EU Employment Law consultation response

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

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

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

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

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

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

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

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

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

Draft Regulations

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

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

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

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

The Home Office has published a new draft Code of Practice on the civil penalty schemes for employers (preventing illegal working). The draft is an update to the version published in March 2022 and will be the sixth version of the code. This latest version of the code will be applied to all right to work checks from 22 January 2024 including where a follow-up check is required to maintain a statutory excuse, even if the initial check was undertaken using a previous version of the code which was current at the time.

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

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

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

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

The guidance covers:

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

The full guidance can be found here.

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Disability: TUC publishes latest data on disability pay gap

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

The key findings of the analysis include:

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

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

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

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

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Further Information:

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

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

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Employment Law General Update –  July 2023

  • Employment,

  • 25th July 2023

Employment Law

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

  • Labour Market: MoD and DWP announce new jobs ‘passport’ for injured or disabled veterans
  • Labour Market: DBT launches consultation on Labour Market Enforcement Strategy for 2024 to 2025
  • Disability: DWP launches consultation on proposals for Disability Action Plan
  • ACAS: New consultation published on new draft Code of Practice on flexible work requests
  • ACAS: Annual ACAS report for 2022 to 2023 reveals dispute resolution ever necessary

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

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

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

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

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

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

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

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

The consultation closes on 8 September 2023.

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

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

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

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

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

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

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Disability: DWP launches consultation on proposals for Disability Action Plan

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

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

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

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

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

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

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

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

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Further Information:

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

Back

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

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Employment Law Case Update – April 2023

  • Employment,

  • 25th April 2023

Employment Law

The devil is in the detail. This month’s case updates include recusing an EAT member for apparent bias to ensure impartiality, upholding a procedural system so that mass litigants could not be removed from an equal pay case, and taking a look at the detail of restrictive covenants, to reduce the effect where it was too fantastical to be valid.

  • Tribunals: EAT lay member recused due to appearance of bias
  • Equal Pay: 700 Sainsbury’s staff to remain in equal pay claim
  • Restrictive Covenants: Is a restrictive covenant still valid if it unintentionally covers “fantastical” areas which were not contemplated, as well as what it set out to do?

Tribunals: EAT lay member recused due to appearance of bias

In Higgs v Farmor’s School and the Archbishops’ Council of the Church of England [2023] EAT 45, the EAT allowed the appellant’s application for the recusal of a lay member from hearing the instant appeal against the respondent. The appellant had filed for an application for the recusal of the lay member, AM, from the hearing of the appeal based on apparent bias. It was alleged that AM’s former position as Assistant General Secretary of the National Education Union (NEU), when that entity was campaigning on matters of educational policy, had publicly expressed clear views, on the opposite side of a heated debate to the position of the appellant. The respondent did not consent to the application for recusal.

The court held, among other things, that a reasonable and well-informed observer would not see AM as an impartial judge for the appeal. Accordingly, applying the test of the fair-minded and informed observer (Porter v Magill), there was an appearance of bias such that the lay member should be recused from hearing the appeal.

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Equal Pay: 700 Sainsbury’s staff to remain in equal pay claim

In Sainsbury’s Supermarkets Ltd v Clark [2023] EWCA Civ 386 the Court of Appeal, Civil Division, dismissed the appeal brought by the appellant, a supermarket company, from a decision which had allowed the respondents’ appeal and reinstated their claims. In 2015 and 2016 a large number of employees working in supermarkets brought equal pay claims against their employers, who included the appellant and other well-known retailers. The case involves two separate but related equal pay claims against Sainsbury’s Supermarkets Ltd and Lloyds. One was brought by women seeking equal pay to male staff and another that would ensure men’s pay does not fall below the women’s if the first claim succeeds.

The claims had generally been brought on a multiple claim form, a type of document expressly permitted by rule 9 of the Employment Tribunals Rules of Procedure. The appellant alleged that the judge had erred in law in interpreting rules 10 and 12 of the Employment Tribunals Rules of Procedure 2013. It added that the employment tribunal should have rejected large numbers of those claims on the grounds that the claim forms did not contain the reference number of a certificate issued by the Advisory, Conciliation, and Arbitration Service relating to early conciliation (EC) of their claims.

The court held, among other things, that the judge’s construction of rule 10 was the correct one. A panel of three judges in the Court of Appeal unanimously ruled that the attempt by Sainsbury’s to remove the majority of claimants in the 865-person lawsuit because their names were not listed in early-stage paperwork was “highly technical” and lacked “any substantive merit”. While a claim form should contain the name and address of each claimant and each respondent, it was sufficient for it to contain the number of an EC certificate on which the name of one of the prospective claimants appeared. There was no suggestion the 700 workers had failed to follow the correct procedure, Lord Justice Bean held.

“It has been repeatedly stated that employment tribunals should do their best not to place artificial barriers in the way of genuine claim”’, Lord Justice Bean wrote. “The complaint is no more and no less than that the employment tribunal claim form did not give the appropriate certificate number”.

Tribunal rules requiring claimants to provide this information are a “preliminary filter” rather than an opportunity to strike out a claim, he added. “I do not accept…that the existence of the certificate should be checked before proceedings can be issued, still less to lay down that if the certificate number was incorrectly entered or omitted the claim is doomed from the star”’, Lord Justice Bean ruled.

Accordingly, the Court upheld the EAT’s decision in the respondents’ favour for a more fundamental reason relating to the structure and wording of the Rules of Procedure.

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Restrictive Covenants: Is a restrictive covenant still valid if it unintentionally covers “fantastical” areas which were not contemplated, as well as what it set out to do?

The Court of Appeal in Boydell v (1) NZP Limited and (2) AI ICE (Luxembourg) Midco S.A.R.L. [2023] EWCA Civ 373, was tasked with considering whether a restrictive covenant that covered what it needed to and what had been contemplated by the parties, but also unintentionally covered other areas (described as “fantastical”) and which had not been contemplated, can it still be valid?

Dr Boydell worked for NZP Ltd, a specialist pharmaceutical business covering a niche area of the pharmaceutical industry described in summary as the development, production and sale of bile acid derivatives for sale to pharmaceutical companies for use by them in their products and is part of the ICE Pharma Group of companies (the second defendant being the ultimate holding company). His contract of employment included a non-competition covenant preventing him from working in any capacity for any competing businesses of either NZP or any of its group companies.

NZP and ICE sought to enforce two sets of restrictive covenants. One set, contained in a variation to the Appellant’s employment contract, ran for one year from the termination of his employment. The other set, contained in a shareholder’s agreement ran for two years. The judge granted an interim injunction enforcing the one year covenants in the employment contract until the trial, with some modifications but refused to enforce the two year restrictions in the shareholder’s agreement (which the companies did not seek to appeal). In doing so, the Judge severed certain parts of the clause, including removing the reference to other group companies. This decision was appealed by NZP who argued that the Judge could not use severance to significantly change the effect of the restraints.

The Court of Appeal disagreed and held that if a clause covers what it needs to and what was contemplated but also unintentionally covers areas which are “fantastical” (Home Counties Dairies Ltd v Skilton) then it may still be valid. If there are two realistic constructions then the court should rely on the one which would result in a valid clause. This meant that, by severing the references to group companies (which were “fantastical”), the Judge had not significantly changed the overall effect of the clause.

Lord Justice Bean (at para.30) said, “The whole burden of the clause is directed to the specialist activities of NZP, which it lists at some length. The judge was entitled, at least at the interim injunction stage, to sever the words from the clause and grant an injunction on a more limited basis. There is a serious question to be tried as to whether other group companies have significant areas of business which are wholly distinct from the activities carried out by NZP. I would, however, refuse Ms Stone’s application for permission to cross-appeal against the judge’s decision to sever the relevant words from clause 3.1.”

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Further Information:

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

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

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