Employment Law Newsletter – October 2021
- Sex Discrimination: Charitable fostering agency policy on homosexual behaviour is unlawful
- Sex Discrimination: Tribunal erred in striking out menopause disability and sex discrimination claims
- Age Discrimination: EAT upholds opposing tribunal decisions on justification of the same compulsory retirement policy
- Whistleblowing: Tribunal applied wrong causation test and failed to distinguish between qualifying and non-qualifying disclosures
- Data Protection: ICO data sharing code of practice under DPA 2018 in force
- Gig Economy: Pensions Regulator welcomes Uber pension scheme but warns gig economy
- New Legislation: Consultation response to tipping, gratuities, cover and service charges
- Diversity: Many employers struggle to recruit Black graduates and fail to provide adequate support in the workplace
- Sexual Harassment: Fawcett Society report shows significant levels of sexual harassment at work
- Artificial Intelligence: PwC reports on the likely impact of AI on the UK labour market
Sex Discrimination: Charitable fostering agency policy on homosexual behaviour is unlawful
In R (Cornerstone (North East) Adoption and Fostering Services Ltd) v Chief Inspector of Education, Children’s Services and Skills (Ofsted)  EWCA Civ 1390, Cornerstone, an independent fostering agency which operates as a charity adhering to evangelical Christian principles, had a recruitment policy requiring foster carers to refrain from “homosexual behaviour“. Cornerstone is regulated by Ofsted, which determined that the recruitment policy should be amended because it was a violation of the Equality Act 2010 (EqA 2010) and the European Convention on Human Rights (ECHR). Cornerstone unsuccessfully applied for judicial review of Ofsted’s decision, the High Court holding that Cornerstone was subject to the EqA 2010 and the ECHR as a hybrid public authority, and that the policy unlawfully discriminated, directly and indirectly, against gay men and lesbians.
Cornerstone appealed to the Court of Appeal. In a unanimous judgment it held that Cornerstone’s policy was a clear instance of direct and indirect discrimination because of sexual orientation. The Court of Appeal considered whether the policy could be justified, under section 19 of the EqA 2010 for indirect discrimination and under section 193(2)(a) in respect of direct discrimination, an exception which allows charities to restrict the provision of benefits to persons who share a protected characteristic where that is a proportionate means of achieving a legitimate aim.
For reasons similar but not identical to the High Court, the Court of Appeal held the policy was not capable of being justified as a proportionate means of achieving a legitimate aim. It emphasised that courts should be slow to accept that prohibiting fostering agencies from discriminating against homosexuals was a disproportionate limitation on their right to manifest their religion. The requirement that discrimination on the ground of sexual orientation required weighty reasons to justify differential treatment was heavily underscored by statute in the case of a religious organisation that provided services to the public. Cornerstone had failed to provide credible evidence to justify the policy.
In concluding comments, the Court of Appeal noted that the appeal was a collision between two protected characteristics and accepted the need to protect those who are discriminated against in small numbers to progress equality for wider communities.
Sex Discrimination: Tribunal erred in striking out menopause disability and sex discrimination claims
In Rooney v Leicester City Council (EA-2020-000070-DA and EA-2021-000256-DA) the EAT has held that a tribunal erred in holding that an employee suffering from menopausal symptoms was not disabled under the Equality Act 2010, and in dismissing her disability and sex discrimination, harassment and victimisation claims. The tribunal’s judgment failed to properly analyse the claims and consider the evidence presented to it, and it was not Meek-compliant as it did not adequately explain why the claims were dismissed. The claims were remitted to a differently constituted tribunal.
This case is an example of the difficulties faced by menopausal women in the workplace and the challenges that can arise in establishing that their symptoms amount to a disability. Despite setting out the employee’s comprehensive list of symptoms and the adverse effects on her day-to-day activities, the tribunal’s conclusion was that the effects were only minor or trivial. This is only the second appellate case concerning menopause discrimination at work that we are aware of, illustrating that these decisions are rarely appealed. The Women and Equalities Committee have recently held an inquiry into this area and their recommendations are awaited.
A reminder that ACAS has produced guidance for employers on how to deal with the impact of the menopause on employees at work: https://www.acas.org.uk/menopause-at-work.
Age Discrimination: EAT upholds opposing tribunal decisions on justification of the same compulsory retirement policy
In conjoined appeals in Pitcher v Chancellor, Masters and Scholars of the University of Oxford  9 WLUK 293 regardingProfessor Pitcher (an Associate Professor of English Literature at Oxford University and an Official Fellow and Tutor in English at St John’s College) and Professor Ewart (an Associate Professor in Atomic and Laser Physics at the University), the EAT has upheld two opposing employment tribunal decisions on the objective justification of a directly discriminatory employer justified retirement age (EJRA) operated by Oxford University and St John’s College. In the first case, an employment tribunal found the EJRA to be justified and the retirement dismissal fair. In contrast, in the second case, a differently constituted employment tribunal upheld the direct age discrimination and unfair dismissal claims, finding that the EJRA was not objectively justified.
The EAT dismissed the appeals against both employment tribunal decisions. The EJRA facilitated the achievement of the legitimate aims (inter-generational fairness, succession planning, and equality and diversity) by ensuring vacancy creation was not delayed. In terms of objective justification, the EAT held that the nature of the assessment undertaken by employment tribunals means it is possible for different tribunals to reach different conclusions when considering the same measure adopted by the same employer in respect of the same aims. While acknowledging that that it is undesirable for an employer to be faced with conflicting tribunal decisions relating to a particular policy, the EAT’s task is not to strive to find a single answer, but to consider whether either tribunal erred in law.
There were two material differences in the way in which the evidence was presented to the tribunals. First, one tribunal had the benefit of statistical evidence on the impact of the EJRA upon the creation of vacancies, which was not available to the other tribunal. Second, the tribunals received different evidence on the detriment suffered by those to whom the EJRA applied and so were entitled to give different weight to the mitigating factors relied on. Following a detailed analysis of the evidence considered and the reasoning adopted by each tribunal, the EAT concluded that neither had erred in law in coming to the conclusions they had on objective justification.
While the upholding of opposing decisions is undesirable from a wider employment law perspective, particularly for employers seeking to justify their own compulsory retirement policy, it demonstrates the importance that such employers should place on evidence or, if unavailable, reasoned projections of the impact of a policy on the achievement of its legitimate aims.
Whistleblowing: Tribunal applied wrong causation test and failed to distinguish between qualifying and non-qualifying disclosures
In Secure Care Ltd v Mott EA-2019-000977-AT (19 October 2021) the EAT has overturned a tribunal’s decision that an employee had been automatically unfairly dismissed in a whistleblowing case. The claimant, Mr Mott, had made a number of complaints to his employer about staff shortages, long working hours, rest breaks and other staffing difficulties, which he said endangered health and safety. He was dismissed, ostensibly for redundancy, and brought a tribunal claim for unfair dismissal under section 103A of the Employment Rights Act 1996, arguing that he had been selected for redundancy because he had made protected disclosures.
The tribunal found that three of his nine alleged disclosures were qualifying disclosures and that these met the test for protected disclosures. The tribunal found that “the fact that he had been ‘pointing out problems’ (in a number of communications some of which amounted to qualifying disclosures) clearly had a material effect on his selection [for redundancy]“. Although there was a genuine redundancy situation, Mr Mott’s dismissal was therefore automatically unfair.
On the employer’s appeal, the EAT held that the tribunal had erred in two respects. First, it had wrongly applied the test in Fecitt v NHS Manchester  ICR 372 (CA), in considering whether the protected disclosures “materially influenced” the employer’s treatment of the claimant. This test should only be applied to claims for detriment short of dismissal under section 47B. The unfair dismissal test under section 103A is whether the protected disclosures were the “sole or principal reason” for dismissal.
Second, the tribunal had failed to confine its consideration to the effect of the three protected disclosures. Rather, it had considered the combined impact and effect of the claimant’s communications about staffing levels and the associated problems this gave rise to.
Data Protection: ICO data sharing code of practice under DPA 2018 in force
The Information Commissioner’s Office (ICO) has updated its Data sharing information hub, confirming that a new version of its statutory data sharing code of practice came into force on 5 October 2021. The code provides practical guidance for organisations on how to share personal data in compliance with the requirements of the UK General Data Protection Regulation ((EU) 2016/679) (UK GDPR) and Data Protection Act 2018 (DPA 2018), including transparency, the lawful basis for processing, the accountability principle and the need to document processing requirements. Section 121 of the DPA 2018 requires the ICO to issue a data sharing code, either by way of amendments to an existing code or by way of a replacement code. The new code replaces the previous version of the data sharing code of practice, published in 2011 under the Data Protection Act 1998. The code has been issued under section 125 of the DPA 2018; a failure to act in accordance with it does not of itself make a person liable to legal proceedings in a court or tribunal, but the code is admissible in evidence in legal proceedings.
Gig Economy: Pensions Regulator welcomes Uber pension scheme but warns gig economy
Website ‘Moneymarketing.co.uk’ reports that The Pensions Regulator has warned gig economy employers that they must “voluntarily and promptly” comply with their auto-enrolment obligations or risk enforcement action.
This comes after Uber recently announced its plan to offer a pension scheme provided by NOW: Pensions to all its eligible UK drivers, following the Supreme Court’s February 2021 ruling that Uber drivers were “workers” and therefore qualified for auto-enrolment.
Commenting on the news, a spokesperson for the Regulator welcomed the “landmark” initiative, adding that “we want to see all eligible workers in this sector have access to pensions saving“.
New Legislation: Consultation response to tipping, gratuities, cover and service charges
The government has responded to the 2016 consultation on tipping, gratuities, cover and service charges, and has confirmed its intention, first announced in 2018, to legislate to provide that tips left for workers are retained by them in full.
Measures to be included in the forthcoming Employment Bill will include:
- Requirements for employers in all sectors not to make any deductions from tips received by their staff, including administration charges, other than those required by tax law.
- Requirements for employers to distribute tips in a way that is fair and transparent, with a written policy on tips, and a record of how tips have been dealt with. Employers will be able to distribute tips via a tronc, and a tip must be dealt with no later than the end of the month following the month in which it was paid by the customer.
- Provisions to allow workers to make a request for information relating to an employer’s tipping record. Employers will have flexibility in how to design and communicate a tipping record, but should respond within four weeks.
- Requirements for employers to have regard to a statutory Code of Practice on Tipping. It is expected that this would replace the existing voluntary code of practice, published in 2009.
Workers will be able to enforce these rights in the employment tribunals. The response states that the Employment Bill will be brought forward when Parliamentary time allows. The new rules are expected to come into force no earlier than one year after the Bill has been enacted.
Diversity: Many employers struggle to recruit Black graduates and fail to provide adequate support in the workplace
Two new reports show that many employers continue to struggle to recruit and retain Black employees. Many Black job applicants feel they are treated unfairly in the recruitment process and continue to face racism at work with inadequate support. The Institute of Student Employers reported that 54% of employers have a strategy to attract Black candidates to their business but only 44% of employers track retention. Another survey, Race at Work, has found that although job applicants from Caribbean (71%) and African (67%) backgrounds are more likely to use a recruitment agency than white people (47%), only 34% of Black candidates felt they are treated fairly, compared to 49% of white people.
Black employees continue to face specific challenges in the workplace, including explicit and covert racism and a lack of representation of Black people in senior positions. Black graduates have called for more support to help successfully transition into the workforce. Currently, less than a quarter of employers provide dedicated support to help their Black recruits address the challenges they face.
The Institute of Student Employers identified that to make a tangible difference, CEO backing is required, and set out five ways companies can support Black graduates before and during their careers, including:
- Being an ally
- Preparing all students for diverse workplaces and addressing racism and diversity as part of this
- Turning recruitment into a force for equality – ensuring that recruitment processes are overhauled to ensure that they are not biased and discriminatory
- Maximising the potential of hires from Black heritage backgrounds – Recognising that organisations need to support hires from Black heritage backgrounds during their early careers
- Transforming your organisation and influencing the world around you – Calling on all stakeholders to make more fundamental changes to ensure representation at all levels of their organisations and that they should lend their voices to wider campaigns for racial justice.
Additionally, the Race at Work report makes several recommendations for the recruitment industry and employers including:
- Critically examining entry requirements, focusing on potential achievement rather than which university or school the individual went to
- Drafting job specifications in plain English and providing an accurate reflection of essential and desirable skills to ensure applications from a wider set of individuals
- Larger employers ensuring that the selection and interview process is undertaken by more than one person, ideally including individuals from different backgrounds to help eliminate bias
- Seeking opportunities to provide work experience to a more diverse group of individuals and stopping the practice of unpaid or unadvertised internships.
Sexual Harassment: Fawcett Society report shows significant levels of sexual harassment at work
A new report published by the Fawcett Society, Tackling Sexual Harassment in the Workplace, shows that at least 40% of women experience sexual harassment during their career. Twenty-three per cent of those surveyed said that the sexual harassment increased or escalated while they were working from home during the COVID-19 pandemic. Disabled women surveyed were more likely to have experienced sexual harassment (68%) than women in general (52%). Employees from ethnic minority backgrounds, both men and women, reported experiencing sexual harassment at a higher level than white employees, with rates of 32% and 28% respectively. The report also found that 68% of LGBT employees had experienced harassment in the workplace.
Culture, policy, training, reporting mechanisms and the way employers respond to reports are five critical elements to help create a workplace intolerant of sexual harassment. The report recommends that employers should:
- Take all forms of sexual harassment seriously.
- Treat employees who report sexual harassment with respect and empathy and ensure women feel able to report harassment, including facilitating anonymous reporting.
- Increase gender equality within the organisation, especially at senior levels.
- Demonstrate leadership commitment to tackling harassment.
- Measure their organisational attitudes towards sexual harassment by conducting an employee survey.
- Provide managers dealing with reports with guidance and support.
- Have a clear and detailed sexual harassment policy that is separate to their general harassment and bullying policy.
The recommendations in the report will form the basis of a sexual harassment toolkit for employers which will be published next January. Employers can sign up to receive a copy of the toolkit (see Fawcett Society: Sexual Harassment Toolkit for Employers).
Artificial Intelligence: PwC reports on the likely impact of AI on the UK labour market
On 8 October 2021, BEIS published a report prepared by PwC, The Potential Impact of Artificial Intelligence on UK Employment and the Demand for Skills. For the purposes of the report, artificial intelligence (AI) is a collective term for digital systems and machines that can, in at least some ways, sense their environment, think, learn and take action in response to what they are sensing and their objectives. The report considers two main questions:
- Whether AI and related technologies (such as robots, drones and autonomous vehicles) will follow historical patterns by triggering significant structural labour market change.
- How large the disruption to labour markets from AI will be and what form it will take.
The report concludes that, while AI and related technologies should not cause mass technological unemployment (by displacing large numbers of workers from their jobs), they may lead to significant changes in the structure of employment across occupations, sectors and regions of the UK. The effects may be relatively small over the next five years but could become more material over the next ten to 20 years. They may add to income inequalities by tending to favour people with higher education and skills levels, who also tend to have higher earnings levels.
PwC’s modelling estimates that professional occupations will experience the highest net job gains over time, with nearly half the increase being in jobs for health professionals and the other half spread between scientists, researchers, engineers, technologists, educators, businesspeople, media professionals and civil servants. AI in these occupations is likely to be largely labour-augmenting and used to perform specific tasks that increase productivity (for example, lawyers using AI to read large numbers of cases to search for precedents and other arguments to use in a current case). Managerial occupations, for which tasks involved are difficult to automate, and occupations requiring “human touch” (such as caring or leisure) are also likely to experience net job creation. Other occupations are likely to experience changing patterns over time, with sales and customer services experiencing the highest rate of job displacement over the next five years, administration experiencing particularly high displacement in five to ten years and manual occupations (including taxi drivers) experiencing high rates of displacement but probably not before the 2030s.
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