A range of decisions from across the spectrum of employment jurisdiction this month as we take a look at some of the most recent cases. A tribunal determined that a consultant contracted through a service company was a worker, making deductions for employer NICs unlawful. The EAT overturned a re-engagement order for an unfairly dismissed employee due to errors in assessing contributory conduct and the issue of the employer’s lost trust. The EAT also found that a tribunal failed to address key issues in a race discrimination claim where an employee alleged her job re-evaluation requests were mishandled due to her ethnicity. And the Court of Appeal upheld that a tribunal erred in determining the timing of a discrimination claim where it was based on delayed knowledge of key facts.
Workers: Consultant engaged by recruitment agency via service company was a worker
Remedies: EAT declared tribunal erred in ordering re-engagement of employee
List of Issues: Tribunal erred in failing to address race discrimination allegation not pleaded but included in list of issues
Discrimination: Tribunal erred in determining claimant’s date of knowledge of claims
Workers: Consultant engaged by recruitment agency via service company was a worker
In Appiah v Tripod Partners Ltd ET/2302929/202, an employment tribunal has found that a consultant who contracted with a recruitment agency through a service company was a worker of the agency under the Employment Rights Act 1996 (ERA 1996).
Ms Appiah was an independent social worker. Tripod Partners Ltd, a social care recruitment agency, placed her on an assignment to the Home Office. The Home Office assessed Ms Appiah using HMRC’s CEST tool. It decided she fell inside IR35 and should therefore be taxed as an employee.
Ms Appiah had previously contracted with Tripod through an umbrella company. However, following the Home Office assessment, Tripod gave her the additional options of an arrangement within PAYE or of contracting via a service company. Tripod explained that there were “small differences” in these options. It also confirmed that if she opted for a service company, it would deduct income tax and employee national insurance contributions (NICs) from her hourly pay. She decided to contract via a service company.
Once the contract had been finalised, Tripod made deductions from Ms Appiah’s pay for income tax, employee NICs and employer NICs. Ms Appiah accepted that Tripod was entitled to make deductions for income tax and employee NICs. However, she brought a claim alleging that the deductions for employer NICs were unlawful under the ERA 1996. Tripod argued that Ms Appiah was not a worker, so could not bring a claim for unlawful deductions.
The tribunal noted that the relevant contract was between two limited companies. However, this was not determinative. The efficacy of statutory protections would be eroded if everyone working through a service company was excluded from the rights afforded by ERA 1996.
It was evident that Ms Appiah was a worker. She sent timesheets to Tripod, not invoices. The contract said she was not a worker, but this did not reflect the reality. She worked full-time on her assignment, performing services personally. There was no difference in substance between the contractual arrangements she had been offered; they were simply different ways in which her payment could be channelled to her. She was not in business on her own account and neither the Home Office nor Tripod were her client. There was no route by which the contractual arrangement could genuinely be said to be between two businesses.
The tribunal went on to uphold Ms Appiah’s claim for unlawful deductions from wages in respect of Tripod’s deductions for employer NICs.
Remedies: EAT declared tribunal erred in ordering re-engagement of employee
In British Council v Sellers [2025] EAT 1, the EAT has held that a tribunal erred in ordering the re-engagement of an employee who had been unfairly dismissed following an allegation of sexual misconduct.
Before ordering re-engagement, a tribunal must consider the employee’s wishes, whether it is practicable for the employer to comply with a re-engagement order and, where the employee caused or contributed to their dismissal, whether ordering re-engagement would be just (section 116(3), Employment Rights Act 1996).
In this case, the tribunal found that, while the relevant decision-taker genuinely believed the employee had committed the alleged misconduct, their belief was unreasonably derived from a flawed investigation which the appeal process had failed to rectify. Following this decision, but before the remedy hearing, the employer instructed an independent investigator to undertake a fresh investigation. The investigator concluded that the accuser had been truthful. The employer upheld its gross misconduct finding.
At the remedy hearing, the employer did not argue that the employee had caused or contributed to his dismissal. Instead, it argued that its genuine and rational concerns about his conduct made it impracticable to re-employ him. The tribunal considered itself bound to address the issue of contributory conduct and found that, on the balance of probabilities, the alleged sexual assault did not occur. It held that it was irrational for the employer to have concerns about the employee’s conduct based on the independent investigation which it considered to be flawed in several respects. The tribunal ordered re-engagement. The employer appealed.
The EAT held that the tribunal erred in determining whether the employee had committed the alleged misconduct. Section 116(3) does not mandate the tribunal to make a finding on contributory conduct. Only where the tribunal has made such a finding (at the liability stage or because it was raised on remedy) would it need to consider whether it would be just to order re-engagement.
The tribunal had also erred by losing sight of the fact that practicability had to be determined from the employer’s perspective. It had considered the reasonableness of the independent investigation when it should have considered whether re-engaging the employee was likely to be practicable in circumstances in which the employer had accepted the investigation’s finding that he had committed a sexual assault and considered that he could no longer be trusted. The re-engagement order was set aside.
List of Issues: Tribunal erred in failing to address race discrimination allegation not pleaded but included in list of issues
In Bogdan v The Cabinet Office: Government Digital Services [2024] EAT 177, the EAT has allowed an appeal where an employment tribunal either failed to address, or failed to give adequate reasons for rejecting, a direct race discrimination claim in which the claimant, Ms Bogdan, alleged that her requests to re-evaluate her job grade were not adequately addressed by her employer, and this was less favourable treatment because she is a Romany Gypsy.
Ms Bogdan was a litigant in person when she issued her claim. In the claim form, there was no hint of any suggestion that she had made several job re-evaluation requests or been subjected to race discrimination by having such requests ignored, mishandled or refused. However, an employment judge subsequently conducted case management, which resulted in a list of issues. This stated that the allegation of direct race discrimination included that, from the beginning of her employment, she had made several job re-evaluation requests to her line manager. The thrust of her case, as set out in the list of issues, was that her employer had failed to deal with those requests, which had left her job wrongly graded.
An employment tribunal dismissed all of Ms Bogdan’s claims. She appealed on the basis that the tribunal failed to adequately deal with her direct race discrimination claim, as there was material evidence to which no reference was made and about which no adequate reasons appeared in the judgment.
The EAT allowed part of the appeal relating to the issues contained in the list of issues concerning her repeated job re-evaluation requests. It concluded that the list of issues effectively operated as substantial amendments to the originally pleaded claims in a way that neither Ms Bogdan’s employer nor the employment tribunal had fully appreciated. Despite the fact that her case, as presented at the tribunal, was not her pleaded case, the EAT concluded that the issues contained in the list of issues were squarely before the tribunal, yet it had fundamentally omitted to deal with them. It was therefore not apparent from its reasoning why she was not successful on those issues. This was a serious procedural irregularity, and the EAT remitted those issues to a new tribunal.
The case is a reminder of the importance of the parties and the tribunal being alive to the issues contained in the list of issues and ensuring that these are adequately dealt with in the reasons contained in the tribunal’s judgment.
Discrimination: Tribunal erred in determining claimant’s date of knowledge of claims
In HSBC Bank plc v Chavalier-Firescu [2024] EWCA Civ 155, the Court of Appeal has upheld the EAT’s decision that a tribunal erred in determining the date on which a claimant had sufficient knowledge to bring her discrimination claims.
In July 2018, the claimant learned that her application to join HSBC Bank plc had been unsuccessful and that someone from her previous employer, Barclays, had given her a bad reference. She had ongoing sex discrimination proceedings against Barclays at that time, but only suspected that this was the reason for the bad reference. However, in August and September 2020, information disclosed following her data subject access request led the claimant to believe that she had been considered a very strong candidate by HSBC, but that a senior manager, on learning of her sex discrimination claim against Barclays, had provided negative feedback to her interviewer, leading to HSBC’s decision not to hire her.
The claimant presented claims against HSBC in November 2020 and May 2021. A tribunal struck out the claims, holding that they were presented out of time as the decision not to appoint her was made in July 2018, there was no continuing act, and it was not just and equitable to extend time.
The court held that the EAT had correctly found that the tribunal had erred in striking out the claims. It had failed to explain its reasoning that the claimant was fully aware of the elements of her claim in July 2018 or show that it had taken proper account of the fact that she had only learned information to support her claims in 2020.
Underhill LJ held that where, as in this case, a claimant seeks an extension of time on the basis that they were unaware of important facts material to the viability of their claim, it is necessary for the tribunal to consider the extent of their knowledge, or grounds for suspicion, at the relevant time to assess what justice and equity require. Following Barnes v Metropolitan Police Commissioner UKEAT/0474/05, it will also be relevant to consider whether they should have known or suspected and, if they did, whether it was nevertheless reasonable for them to delay issuing proceedings. The claims were remitted to a different tribunal to consider whether it would be just and equitable to extend time.
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.
Prior to its success in the general election that took place on 4 July 2024, the Labour Party proposed wide-ranging and fundamental reform of employment law. It promised that several of its reforms would be contained in an Employment Rights Bill (ERB), which was introduced on 10 October 2024.
Together with the draft ERB, on 10 October 2024, the government published a policy paper, Next Steps to Make Work Pay (Next Steps paper), which set out the steps the government intends to take following the publication of the ERB. It confirms that further detail on many of the policies contained in the ERB will be provided through partnership with business, workers and trade unions, regulations, and in some cases codes of practice, after the ERB has received Royal Assent, which is expected to be in 2025.
The ERB makes provision for wide-ranging changes to be made to employment law, including in relation to unfair dismissal, fire and rehire, collective redundancies, zero hours and low hours contracts, trade unions and industrial action, sexual harassment and third-party harassment, statutory sick pay (SSP), flexible working and family leave. In October 2024, the government published four consultations as part of its first phase of consulting relevant stakeholders. Further consultations are expected in 2025, which will deal with matters to be included in supporting regulations.
The existing right to two weeks’ parental bereavement leave following the death of a child under 18 or a stillbirth will be extended to be an entitlement to more general “bereavement leave”, which will apply to the loss of a wider group of persons (clause 14, ERB). Like the current provision for parental bereavement leave, bereavement leave will be a day-one right. Regulations will specify the relationships with a person who has died that will qualify an employee to take bereavement leave, and the government will consult on the details to be set out in secondary legislation.
The ERB strengthens redundancy rights and protections by removing the “at one establishment” test for collective redundancies, meaning that the threshold of 20 or more redundancies will be met when that number is impacted across the entire business, rather than at one site. This will increase the obligations on multi-site employers to collectively consult and will require them to keep rolling records of redundancies proposed across their multiple sites. In addition, the government is consulting about raising the current level of the protective award from 90 to 180 days’ pay, or to an uncapped amount and allowing employees to claim interim relief where they have a claim for a protective award or a claim for unfair dismissal in a fire and rehire scenario. During 2025, the government also plans to consult on increasing the minimum collective consultation period when an employer is proposing to dismiss 100 or more employees from 45 to 90 days.
The practice of fire and rehire has received widespread negative press coverage in recent years following a number of high-profile cases. These include the dismissal of almost 800 employees by P&O Ferries in 2022, to be replaced by lower-paid agency staff, and also a case where Tesco (unsuccessfully) sought to use the practice to overturn preferential pay rates it had agreed on a “permanent” basis with staff who agreed to relocate.
The ERB would restrict the ability of an employer to use dismissal and re-engagement (known as “fire and rehire”) as a lawful means of changing an employee’s contractual terms, save where there is genuinely no alternative, due to financial difficulties which threaten the employer’s ability to carry on business as a going concern. It does this by making any dismissal automatically unfair where the reason for dismissal is that the employee did not agree to the employer’s attempt to vary their terms and conditions, or because they intended to employ another person to carry out substantially the same role. On 21 October 2024, the government published a consultation on strengthening the remedies against abuse of the fire and rehire and collective consultation rules (see above). The consultation closed on 2 December 2024.
It is not clear what the government’s intentions are with regard to the Statutory Code of Practice on Dismissal and Re-engagement which was introduced under the previous Conservative government but only came into force on 18 July 2024. Despite its previous strong criticisms of the Code as being “inadequate”, it remains in force for now. It is possible that the government still intends to replace the Code with another one containing more stringent obligations on employers, as envisaged in the Plan to Make Work Pay, although any new Code of Practice would need to be consulted on before it could receive parliamentary approval.
Future regulations made under clause 26 of the ERB will require employers with 250 employees or more to develop and publish equality action plans showing what steps they are taking in relation to prescribed matters related to gender equality and to publish prescribed information relating to their plans.
Matters relating to gender equality will be those concerning the advancement of equality between male and female employees and will include addressing the gender pay gap and supporting employees going through the menopause. In November 2024, proposed amendments to the ERB were published which will be considered by the Public Bill Committee. An amendment proposed by the government would require employers to include an explanation in their equality action plans on how they are supporting employees with menstrual problems and menstrual disorders.
The government will consult the Equalities and Human Rights Commission (EHRC) on the content of the regulations before they are published.
The ERB contains provisions permitting the Secretary of State to delegate their labour market enforcement functions to a public authority and to appoint enforcement officers. The Next Steps paper confirms that this will be the new Fair Work Agency (FWA), which will bring together the existing enforcement functions of HMRC (in relation to the national minimum wage (NMW)), the Employment Agency Standards Inspectorate (EASI) and the Gangmasters and Labour Abuse Authority (GLAA). The introduction of a single enforcement body has long been on the cards and was one of the government’s key manifesto pledges. However, whether the FWA succeeds in improving enforcement is likely to depend on the level of financial resources it is allocated, which is not yet clear. It is not yet known when the FWA will be established, although it is likely to be a number of years before it is fully operational.
Paternity leave and unpaid parental leave will become a day-one right for eligible employees. The government also stated in the Next Steps paper that it intends to make it unlawful to dismiss employees who have been pregnant within six months of their return to work, except in specific circumstances. Regulations are awaited to define what these specific circumstances will be. The government also stated in the Plan to Make Work Pay that it would conduct a review of the current parental leave system during the first year of the Labour government, so this is expected by July 2025.
The existing day-one right to request flexible working under Part VIIIA of the ERA 1996 (sections 80F to 80I) (as amended) together with the Flexible Working Regulations 2014 (SI 2014/1398) (Flexible Working Regulations) (as amended) will remain, but the ERB will introduce a reasonableness test into the regime, providing that employers will only be able to rely on one of the statutory reasons to refuse a request for flexible working where it is “reasonable for the employer to refuse the application on that ground or those grounds”. In addition, employers will be required to state and explain what the ground for any refusal is and why the refusal is considered reasonable. The Next Steps paper confirmed that there will be a consultation to develop the detail of the approach to be taken on flexible working.
The ERB will amend section 40A of the EqA 2010 to require employers to take “all reasonable steps” to prevent sexual harassment, reflecting the wording originally contained in the Worker Protection Bill. Currently, employers are required to take reasonable steps to prevent sexual harassment of their employees during the course of their employment under the Worker Protection (Amendment of Equality Act 2010) Act 2023, which came into force on 26 October 2024. Employers will also be under a duty to take “all reasonable steps” to prevent third-party sexual harassment, and to prevent third-party harassment in relation to the other relevant protected characteristics.
In addition, the ERB will amend the whistleblowing provisions of the ERA 1996 to make it clear that reporting sexual harassment will amount to a qualifying disclosure.
The ERB provides employees with the right to SSP from the first sick day rather than from the fourth day and removes the requirement for the employee’s earnings to be not less than the lower earnings limit to be eligible for SSP.
On 21 October 2024, the government published a consultation on SSP. The consultation, which closed on 4 December 2024, sought views on what the percentage of average weekly earnings should be for the purposes of calculating the rate of SSP for some low-earning employees.
The ERB will repeal the Strikes (Minimum Service Levels) Act 2023. While nearly all of the restrictions placed on industrial action and picketing by the Trade Union Act 2016 will be removed, the time-limited mandate for industrial action following a ballot will remain. The ERB will introduce the right to a statement of trade union rights and the right for trade unions to access workplaces, it will simplify the rules on trade union recognition, introduce protection against detriment for taking industrial action and increase protection against dismissal for taking industrial action. These are summarised below.
The Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA 1992) will be amended to require employers to give workers a written statement advising that they have the right to join a trade union at the same time as providing the worker’s section 1 statement and at other prescribed times.
Unrecognised unions will be provided with the opportunity to recruit and organise within a workplace with the aim of gaining recognition. Trade unions and employers will be able to enter “access agreements” providing union officials with access to the employer’s workplace for the purposes of meeting, representing, recruiting or organising workers, or facilitating collective bargaining (but expressly not to organise industrial action). The union may apply to the Central Arbitration Committee (CAC) to determine workplace access if the employer fails to respond to its request for an access agreement. Either party may make an application where negotiations are unsuccessful.
The statutory scheme for trade union recognition set out in Schedule A1 to TULRCA 1992 will be amended to:
Enable the 10% membership threshold for the CAC to accept a trade union recognition application (and at other stages of the recognition scheme) to be reduced to between 2% and 10%.
Remove the requirement at the application stage (and at other stages of the recognition scheme) for a union to demonstrate that there is likely to be majority support for trade union recognition.
Remove the 40% support threshold from recognition ballots.
Protection against detriment for taking industrial action
TULRCA 1992 will be amended to provide workers with the right not to be subjected to detriment of a prescribed description by any act (or any deliberate failure to act) by their employer, if the act (or failure) takes place for the sole or main purpose of preventing or deterring the worker from taking protected industrial action, or penalising the worker for doing so.
TULRCA 1992 will be amended to provided that for the full duration of an official, lawful strike and after that strike has concluded, an employee will be automatically unfairly dismissed where the reason (or, if more than one, the principal reason) for the dismissal is that the employee took such protected industrial action.
The government’s consultation, Making Work Pay: creating a modern framework for industrial relations, which closed on 2 December 2024, sought views on strengthening provisions to prevent unfair practices during trade union recognition, simplifying industrial action ballots, reducing notice of industrial action, extending the permitted duration of industrial action, updating the law on repudiation of industrial action and on prior call, and on enforcement of the trade union right to access workplaces.
In a set of amendments to the ERB published in November 2024, the government confirmed that it would extend the time limits for bringing all tribunal claims from three to six months. It is not yet clear when this measure will take effect.
Under the ERB, the right to bring a claim for unfair dismissal will become a day-one right for employees, subject to a new modified “light-touch” dismissal procedure applicable in most cases during an initial period of employment, which will be set by regulations but must be between three and nine months. It removes the two-year qualifying period for ordinary unfair dismissal protection by repealing section 108 of the Employment Rights Act 1996 (ERA 1996). Much of the detail will be contained in regulations and is as yet unknown, but this will represent a hugely significant change in the unfair dismissal landscape. To allow for full consultation and a substantial period for employers to prepare and adapt, the unfair dismissal reforms will take effect no sooner than autumn 2026.
In November 2024, proposed amendments to the ERB were published which are being considered by the Public Bill Committee. A government amendment will allow the Secretary of State to specify a cap on the compensatory award for employees unfairly dismissed during the initial period of employment provided for in the ERB.
Employee representative bodies and trade unions have long condemned the use of zero hours contracts as a means of abusing vulnerable, low-income workers, and providing no job security, rights or guaranteed income. There is very limited protection for workers on such contracts. The ERB will introduce a duty on employers to offer a guaranteed hours contract that reflects the hours qualifying workers regularly work over a reference period (to be specified in regulations, but the government suggested in the Next Steps paper that in its view it should be 12 weeks). The ERB also places a duty on employers to provide reasonable notice of shifts, with workers being entitled to compensation if their shift is cancelled, moved or curtailed at short notice.
On 21 October 2024, the government published a consultation on the application of the zero hours contracts provisions to agency workers. The consultation, which closed on 2 December 2024, explored who should be responsible for offering guaranteed hours to eligible workers: the agency or the hirer. The government notes that a difficulty of making agencies responsible is that they have little or no control, since the demand for hours is largely dictated by hirer. Hirers would, therefore, be in a better position to forecast and manage the flow of work. However, requiring hirers to offer guaranteed hours might effectively make them the agency worker’s employer.
In November 2024, proposed amendments to the ERB were published which are being considered by the Public Bill Committee. Substantial government amendments were put forward in relation to zero hours and “low hours” contracts, including new requirements for employers to take reasonable steps to ensure that workers are given specified information in relation to their rights to guaranteed hours during an “initial information period” and to give workers a notice where they consider an exception to the duty to make a guaranteed hours offer applies, or where a guaranteed hours offer that has been made is treated as having been withdrawn.
A draft Equality (Race and Disability) Bill (Race and Disability Bill) was announced in the King’s Speech 2024, to be led by the Government Equalities Office (GEO). It will be published in draft form for consultation and deliver Labour’s manifesto commitment to “enshrine the full right to equal pay in law” for ethnic minorities and disabled people. There is expected to be significant consultation on the draft Race and Disability Bill and so it is anticipated that it will progress more slowly than the ERB.
The Race and Disability Bill will tackle two main issues:
Enshrine in law the full right to equal pay for ethnic minorities and disabled people. This will make it easier for them to bring unequal pay claims, given the existing barriers when bringing pay discrimination claims on the grounds of ethnicity or disability.
Introduce mandatory ethnicity and disability pay reporting for employers with 250 or more employees. This will help to close the ethnicity and disability pay gaps, enabling employers to constructively consider why they exist and how to tackle them.
The Next steps paper also states that the government will create a new regulatory enforcement unit for equal pay.
The Neonatal Care (Leave and Pay) Act 2023 received Royal Assent in May 2023 and was expected to come into force in April 2025 under the previous Conservative government. The government has confirmed this will come into effect on 6 April 2025. HMRC has published a policy paper on the tax treatment of statutory Neonatal Care Pay (see HMRC: Income Tax: tax treatment of Statutory Neonatal Care Pay). The Act will introduce statutory neonatal leave and pay for up to 12 weeks for parents of babies requiring neonatal care, which must be taken within 68 weeks of birth.
The Plan to Make Work Pay stated that a new “right to switch off” would be introduced, providing workers with the right to disconnect from work outside of working hours and not be contacted by their employer. This would follow similar models to those that are already in place in Ireland and Belgium, giving workers and employers the opportunity to have constructive conversations and work together on bespoke workplace policies or contractual terms that benefit both parties.
There is nothing on this new right in the ERB, and in the Next steps paper, the government confirmed that it would take forward the right to switch off through a statutory Code of Practice. It is expected that a consultation on the new code of practice will be issued in 2025.
Gender identity is a highly charged issue with polarised views about, on the one hand, a transgender person’s right to have their identity recognised, and on the other hand, so-called “gender critical beliefs” that a person’s sex is an immutable biological fact and that someone’s gender is different from their sex.
Recent case law has recognised gender critical beliefs as being capable of protection under the Equality Act 2010 (EqA 2010) as a philosophical belief (Bailey v Stonewall and others ET/2202172/2020). This provides scope for conflict with other protected characteristics under the EqA 2010, including the protected characteristic of gender reassignment (Fischer v London United Busways Ltd ET/2300846/2021), and poses a challenge for employers who are responsible for preventing discrimination and harassment in the workplace. In For Women Scotland Ltd v Scottish Ministers, the Inner House of the Court of Session confirmed that the definition of “woman” in section 212(1) of the Equality Act 2010 includes trans women with a gender recognition certificate. The case has been appealed and was heard by the Supreme Court on 26 and 27 November 2024.
In May 2024, the Minister for Women and Equalities issued a “call for input” seeking examples of policies or guidance issued by public bodies, or those that advise public and private organisations, which might wrongly suggest that people without a gender recognition certificate (GRC) have a legal right to access single-sex spaces and services according to their self-identified gender. The call for input on incorrect guidance on single-sex spaces closed on 26 June 2024.
Modern workplaces are increasingly receptive to and reliant on tools powered by artificial intelligence (AI) such as machine learning, GenAI and automated decision-making to perform certain human resources and employee management functions. In addition, the development of GenAI applications, which can be used to perform a variety of work-related tasks, means that AI is more accessible to the workforce than in the past.
In terms of reform in this area, the government’s Next Steps paper, promised that a consultation would be issued on how to implement measures on surveillance technologies and negotiations with trade unions and staff representatives.
Prior to this, the King’s speech, which was delivered in July 2024, announced that the government:
“… will seek to establish the appropriate legislation to place requirements on those working to develop the most powerful artificial intelligence models”.
Labour’s manifesto (Labour: Change), published in June 2024, promised that Labour would create a new Regulatory Innovation Office, bringing together existing functions across government, to help regulators update regulation and to co-ordinate issues that span different sectors, as it considers that regulators are currently ill-equipped to deal with the dramatic development of new technologies. It also promised to ensure the safe development and use of AI models by introducing binding regulation on the companies developing the most powerful AI models.
Labour’s Plan to Make Work Pay, noted that new technologies such as AI have the potential for positive change, including boosting wages, improving productivity and empowering workers. However, given the risks posed, Labour’s approach will be to protect good jobs and ensure good future jobs. It plans to put in place appropriate rights and protections to keep pace with technological change, while safeguarding against discrimination. At a minimum, Labour stated that it will ensure that proposals by employers to introduce surveillance technologies will be subject to consultation and negotiation, with a view to reaching agreement with trade unions or elected staff representatives. This would not override the provisions of any collective agreement relating to surveillance.
Labour’s New Deal green paper, which was first published in September 2021, had previously stated that proposals by an employer to introduce surveillance technologies would be subject to consultation and agreement by trade unions or elected staff representatives, although it was subsequently reported that this new “right” could be implemented by way of best practice advice or secondary legislation, in a perceived watering down of the original pledge.
The EU is taking a more interventionist approach than the UK. A new Regulation, the EU AI Act, was formally adopted by the Council of the EU on 21 May 2024. The EU AI Act applies to public and private actors inside and outside the EU if the AI system affects individuals in the EU, and categorises AI systems into risk levels.
The Platform Workers Directive entered into force on 1 December 2024. Member states will have two years to incorporate the provisions of the Directive into their national legislation. The Directive provides new rights aimed at promoting transparency, fairness and accountability in algorithmic management used in platform work.
Due to the increasing use of AI in the workplace, there is a greater need to assess and manage the associated risks. In March and November 2024, new guidance was published by the government and the ICO specifically aimed at AI use in the HR and recruitment sectors. There are several actions that an employer can take to mitigate the risks, such as undertaking risk assessments and carrying out due diligence with suppliers of AI systems.
From 31 December 2024, the sponsor licence guidance was updated to prohibit Skilled Worker sponsors from passing on the cost of the sponsor licence fee or associated administrative costs or the Certificate of Sponsorship (CoS) fee (for CoS assigned on or after 31 December 2024). Back to the top
Further Information
If you would like any additional information, please contact Anne-Marie Pavitt or Sophie Banks on: hello@dixcartuk.com
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.
This month sees an emphasis on Equality through a landmark equal pay...
News & Views
Employment Law Case Update – November 2024
Employment,
27th November 2024
Employment Law
This month’s newsletter highlights some critical aspects of employment law underscoring the evolving interpretations of workers’ rights, employer obligations and procedural safeguards. The EAT has clarified worker status, once again, providing guidance on how a black cab driver supplementing his income using a ride-hailing app was not a “worker” but operated independently, contrasting with the Uber precedent emphasizing factors like business autonomy and flexibility in accepting or rejecting fares. Another case showed the EAT upholding the inadmissibility of pre-termination settlement negotiations in unfair dismissal claims unless improper behaviour is evident, reaffirming the protective scope of “without prejudice” conversations. And lastly, an employer has been found liable for unfair dismissal and discrimination after firing an employee upon learning she was pregnant during her return from maternity leave, with the tribunal spotting inconsistencies in the employer’s rationale.
Worker Status: Driver using a black cab app was not a worker
Unfair Dismissal: Evidence of pre-termination negotiations inadmissable
Unfair Dismissal: Pregnant employee sacked when pregnant on return from maternity leave
Worker Status:Driver using a black cab app was not a worker
In Johnson v GT Gettaxi (UK) Ltd [2024] EAT 162, the EAT held that the Claimant was not a worker of the Respondent company. The Respondent operated a customer application which allowed members of the public to order black cabs, rather than hailing a black cab on the street. Licensed black cab drivers could sign up to the driver app, are free to ply for hire while signed up to the app and can register with other similar taxi apps at the same time as using the driver app.
The Claimant was a licensed black cab driver from April 2014. He signed up and used the Respondent’s app between April 2015 and 2017 and made 171 journeys, making up approximately 5% of his earnings. In 2020, when he re-applied to use the app, his application was refused. He believed that this was because he had made protected disclosures. This gave rise to a preliminary issue as to whether or not the Claimant was a worker under s.230 of the Employment Rights Act 1996.
The case had obvious echoes of Uber BV & Ors v Aslam & Ors [2018] EWCA Civ 2748, where the Supreme Court held that Uber drivers were workers. However, both the employment tribunal and the EAT found that the Claimant was not a worker of the Respondent and that the Respondent’s drivers, more generally, were not workers. They were in business on their own account as black taxi drivers. The use of the Respondent’s app was just a way to increase their business. The following points were relevant to this conclusion:
No penalties were imposed by the Respondent for rejections of rides offered. This indicated that the Claimant was in business on his own account.
The Claimant was free to follow the routes he considered best and there was no penalty for not following the GPS route (unlike in Uber v Aslam).
The Claimant was given limited details about passengers on accepting fares. There was nothing stopping the Claimant from making arrangements direct with passengers for other trips.
Drivers were able to increase their earnings by plying for hire in the traditional way as a black cab driver or by signing up to other apps. This was different to Uber, as Uber drivers could not ply for hire in the same way as a black taxi can.
Unfair Dismissal: Evidence of pre-termination negotiations inadmissable
In Gallagher v McKinnon Auto and Tyres Ltd [2024] EAT 174, the Employment Appeal Tribunal upheld the tribunal’s decision that pre-termination negotiations between the Claimant and the Respondent were inadmissible in his unfair dismissal claim.
Under s.111A of the Employment Rights Act 1996, pre-termination discussions, known as ‘protected conversations’, are inadmissible in ordinary unfair dismissal claims if conducted without ‘improper behaviour’, allowing confidential conversations about mutually agreed employment termination terms, even without a prior dispute. The provision is supported by an ACAS Code.
The Claimant had worked as a branch manager for the Respondent and due to illness had been absent. When he returned to work, the Respondent decided his position was no longer needed and proposed a redundancy process. At a meeting stated to be ‘off-the-record’, the Claimant was offered a settlement agreement and given 48 hours to respond, with the indication that redundancy would follow if he declined. The Claimant refused and was subsequently dismissed for redundancy. He claimed unfair dismissal and attempted to use the settlement discussions in evidence. The tribunal ruled these discussions were protected pre-termination negotiations, and since there was no improper behaviour, they were inadmissible.
The Claimant appealed to the EAT, arguing that the tribunal’s decision in this regard was perverse. He argued there was improper behaviour as:
He was told the meeting was a ‘return to work’ meeting and was taken by surprise when it was used to propose severance terms – it was therefore set up under false pretences;
He was only given 48 hours to consider a redundancy offer of £10,000, contrary to ACAS guidance suggesting a minimum of 10 calendar days; and
He was told his role was redundant, therefore exerting undue pressure on him implying his dismissal was inevitable if the offer was not accepted.
The EAT upheld the decision of the ET. In dismissing the appeal, it held that 1 and 2 did not represent improper behaviour in the circumstances: the discussions were calm, and the Claimant was given an opportunity to consult with family and seek advice. While the meeting’s purpose was not transparent, this did not amount to impropriety sufficient to override the statutory inadmissibility of the negotiations. The EAT agreed that the 48-hour deadline for considering the verbal offer was not unreasonable under the circumstances. The Claimant could have accepted, countered, or rejected the offer. The Respondent’s statement that the role was redundant was found to relate to initiating a redundancy process rather than a definitive dismissal threat.
In respect of 3, the EAT held that it was important to distinguish redundancy situations from disciplinary situations. The ACAS Code does state that a form of undue pressure can be telling an employee that, if they do not accept the offer, they will be dismissed. However, this guidance specifically refers to a disciplinary situation. In this case, a redundancy situation had arisen. It was accepted that the Respondent had told the Claimant that his role was redundant. However, this did not mean that dismissal was inevitable as there were still the possibility of alternative employment.
The Claimant attended a meeting with the managing director, Jeremy Morgan, in February 2023 that began “positively”, with him “saying the business was doing well” and explaining they recently managed to secure a contract with the NHS. Mr Morgan went on to say he was looking forward to her coming back to work and they agreed what hours she would be working. However, towards the end of the meeting, the Claimant admitted she was pregnant again. When her maternity leave ended at the end of March, no one contacted her about her return to work and they failed to respond to an enquiry about her holiday allowance for later in the year. A little while later, following other contact between the two in April, Mr Morgan called to say that following financial difficulties, late payments and a new software system being installed, she was being made redundant.
The judge found there was significant inconsistency in Mr Morgan’s reasoning for making the Claimant redundant. During their February meeting, he had claimed the business was doing well and made no mention of financial difficulties. He also hadn’t made any mention of the new software that supposedly made the Claimant’s role obsolete, even during their April phone call. No evidence of either had been produced during the tribunal case and at no stage did he send the Claimant a written statement setting out the reasons for the dismissal. He therefore ruled that the Claimant was dismissed because she was pregnant.
The judge found that her dismissal was “unfair, discriminatory, and caused significant emotional distress.” He emphasised that being fired while pregnant and losing financial stability had a profound impact on her, particularly given her family responsibilities.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – October 2024
Anne-Marie Pavitt,
30th October 2024
Employment Law
This month our case digest is dominated by unfair dismissal and victimisation claims. The usual advice follows: if you’re going to dismiss someone, make sure you follow procedure and do it properly, a protected disclosure only gains its protection from being in the public interest (not that of the individual), even unions can get it wrong, and if you’re going to submit a large remedy claim have substantial medical evidence to back it up.
Unfair Dismissal: Tribunal fails to consider fairness of final warning
Unfair Dismissal: Claimant can’t rely on protected disclosures if not made in public interest
Victimisation: Tribunal incorrectly applied burden of proof provisions and rejected protected act
Victimisation: Substantial lack of medical evidence and self-diagnosis not enough for high value remedy claim
Unfair Dismissal: Tribunal fails to consider fairness of final warning
In Thomas v Brandpath UK Ltd[2024] EAT 150, the EAT allowed the claimant’s claim for an unfair dismissal. After an altercation between the claimant and a colleague, the claimant was signed-off sick for a significant period and the respondent conducted a disciplinary hearing in her absence. The claimant was dismissed by the respondent and the Employment Tribunal (ET) concluded that the claimant had acted “inappropriately”. The claimant argued that the ET: (i) did not consider and decide whether the issue of the final warning was manifestly unfair; (ii) there was a failure to apply the relevant guidelines; (iii) the decision was perverse; and (iv) that there was unfairness in proceeding with the disciplinary hearing, in the absence of the claimant, rather than delaying to allow for a possible improvement in her medical condition.
The EAT held that the ET erred in law is its assessment of the reason for dismissal, in failing to determine the question of whether the final warning was manifestly unfair, having identified that as one of the issues for determination. It failed to properly consider the question of whether the respondent had investigated that fell within the band of reasonable responses. There was no clear finding of what the claimant had done or said that was “inappropriate”. They upheld grounds (i) and (ii) of the appeal. It was therefore not necessary to go on to consider grounds (iii) and (iv).
Unfair Dismissal: Claimant can’t rely on protected disclosures if not made in public interest
In Dowding v The Character Group Plc[2024] EAT 153, the claimant in the employment tribunal was the finance director of the respondent, a company listed on the Alternative Investment Market. Following his dismissal he complained of unfair dismissal for the reason or principal reason that he had made protected disclosures, alternatively ordinary unfair dismissal. The tribunal concluded that the claimant had not, in law, made protected disclosures, because the disclosures relied upon were not believed by him to have been made in the public interest (alternatively, if they were, his belief was not reasonable). Nor in any event was the claimant dismissed by reason of those disclosures.
The tribunal found that this was a fair dismissal by reason of a breakdown in trust and confidence that had been caused by the claimant’s conduct. At a further costs hearing the tribunal awarded the respondent costs, in a capped amount, subject to detailed assessment on the indemnity basis. It rejected a costs application by the claimant himself. The respondent also successfully sought its costs in respect of the costs hearing, which it had limited to the maximum that could be summarily awarded, of £20,000.
The claimant’s appeal against the decision dismissing the ordinary unfair dismissal complaint was unsuccessful. An appeal against the costs decision succeeded in two respects. The EAT concluded that, under the Employment Tribunal Rules of Procedure 2013, the tribunal does have the power to direct that a detailed costs assessment be on the indemnity basis; but the tribunal had not shown whether, or if so, why, it had decided that such a direction was warranted in this case, applying the guidelines in Howman v Queen Elizabeth Hospital, UKEAT/0509/12/JOJ. In respect of the “costs of costs” award, the tribunal had not considered whether the sum of £20,000 was warranted having regard to the nature, gravity and effect of the conduct which gave rise to the award; or if it had considered that, it had not sufficiently explained its decision in that respect.
Victimisation: Tribunal incorrectly applied burden of proof provisions and rejected protected act
In Edwards v Unite the Union and Others[2024] EAT 151, the Employment Tribunal was found by the EAT to have erred in its approach to the burden of proof. The Claimant had been employed as an employment law solicitor for the RMT. He wished to pursue proceedings against the RMT. He was a member of the Unite the Union (“the Union”) and sought to obtain “industrial and legal representation” from the Union against the RMT in respect of employment and personal injury claims. The Union took advice in respect of his claims and represented him in some of them. The Claimant was dissatisfied with aspects of the decision making and service/representation provided to him by the Union. He asserted that the Union and some of its officers had discriminated against him and subjected him to victimisation. He brought a number of claims before an Employment Tribunal. The Tribunal rejected his claims and concluded that the burden of proof had not shifted to the Union in respect of the victimisation allegation, and determined that one email the Claimant sent was not a protected act for the purposes of the claims of victimisation. The Claimant appealed.
The appeal was allowed, concluding that the Tribunal had erred in its application of the burden of proof provisions in consideration of relevant authorities and using guidance on the approach to the burden of proof provisions. As to the second ground of appeal, in context and applying the correct legal principles, and on a fair reading of the relevant email, the Claimant had made an allegation of disability discrimination. The allegation was that the First Respondent had failed to adjust its processes and that as a result, the Claimant, a disabled person, suffered harm. This could be understood to be an allegation of disability discrimination.
Victimisation: Substantial lack of medical evidence and self-diagnosis not enough for high value remedy claim
In McInerney v Nottinghamshire Healthcare NHS Foundation Trust[2024] EAT 158, having been awarded compensation in respect of remedy for a successful claim of unfair constructive dismissal, the Employment Tribunal (ET) made a further reserved judgment in respect of the remedy for victimisation claim which amounted to £20,000 for injury to feelings, £10,000 for aggravated damages (which were not challenged) and £23,344.30 for loss of earnings, against which Dr McInerney appealed. The final schedule of loss submitted by the appellant put her losses at £2,114,140.90 gross. The EAT dismissed her appeal against the findings made in this further reserved judgment by the ET.
The appellant had been employed by the respondent NHS Trust as a Consultant Forensic Psychiatrist at a hospital until her retirement. The appellant brought two claims in the ET, alleging acts of victimisation that led to her resignation. Her victimisation claim was based on the respondent’s refusal to consider her application to work on a part-time basis as Forensic Psychiatrist in the respondent’s Forensic Gender Clinic and, specifically, refusing to allow her to apply for the role, not acknowledging or considering her subsequent application and not offering her the role. She contended that her mental health issues, allegedly caused by the victimisation, prevented her from working until the age of 75, as she had intended. The appellant succeeded in both complaints. The ET was highly critical of the actions of the respondent that resulted in the appellant’s resignation, concluding that the respondent had fundamentally breached the claimant’s contract of employment.
The ET found as fact that the appellant had not suffered a loss of confidence because of being victimised that prevented her from undertaking medico-legal work. Among other things, the appellant submitted that the ET failed to apply a percentage chance approach to the medico-legal loss or had otherwise failed to give adequate reasons as to its decision on that point. The EAT held that the ET did not err in law in failing to apply a percentage chance approach to the medico-legal loss. On a proper reading of the judgment, the ET found as a fact that the appellant had not suffered a fundamental loss of confidence that prevented her from carrying out medico-legal work. The ET had been entitled to consider the lack of significant supporting medical evidence to support the very substantial asserted losses (a single letter from a doctor – Consultant Psychiatrist in Psychotherapy, no longer practising) and that it was a significant omission. This is a very high value claim which primarily rests with the appellant’s financial losses she says arise as a result of her mental health issues cause by the victimisation by the respondent, and as a consequence, the ET consider medical evidence to be essential to enable proper consideration of the effect of the victimisation on the appellant’s mental health. She had also relied on her own evidence, as a Consultant Psychiatrist, but relying on self-diagnosis in such a high claim would in itself raise potential issues, not least being the cynical view that she would know what to say to support her own claim. Further, the reasons of the ET had been more than sufficient for the appellant to understand why she failed in that element of the claim for loss of earnings.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law General Update – October 2024
Anne-Marie Pavitt,
30th October 2024
Employment Law
Big changes are afoot this month with the introduction of the new Labour government’s Employment Rights Bill, aiming to fix problems perceived by the Labour party during their long stint in opposition, such as addressing one-sided flexibility, supporting more family friendly rights and prioritising fairness, equality and wellbeing of workers, ensuring fair pay, modernising trade union legislation and improving enforcement of employment rights. Consultation over the Bill will start now and continue in 2025, with the aim to implement the changes in 2026. We also bring you updates on sexual harassment, proposed employment rights for parents of still-born children and those born prematurely, guidance on the new Tipping Act, and a change in equality office.
Legislation: Government publishes Employment Rights Bill
Protection at Work: The Worker Protection (Amendment of Equality Act 2010) Act 2023 to comes into force on 26 October 2024 and EHRC updates its harassment guidance and publishes eight-step guide for employers on preventing sexual harassment at work
Parents: New private members’ bill on Still-Birth and leave for Neo-natal care
Pay: New Tipping Act and supplementary Code of Practice comes into force – guidance available
Equality: Office for Equality and Opportunity replaces the Equality Hub
Legislation: Government publishes Employment Rights Bill
Background: In September 2021, the Labour Party first introduced its plan for working people in its ‘A new deal for working people’, launched at the Labour Party Conference. The document underwent several iterations, with the final version, Labour’s Plan to make work pay: Delivering a new deal for working people (New Deal), published just prior to the release of the manifesto in June 2024. The Labour Manifesto reiterated a number of the promises set out in the New Deal document and stated that the New Deal would be implemented in full within the first 100 days of the Labour government. The King’s Speech on 17 July 2024 confirmed that Labour’s plans would be implemented through the Employment Rights Bill 2024 (Bill) and the Equality (Race and Disability) Bill 2024. The Employment Rights Bill 2024 was published on 10 October 2024.
When will the Bill come into force? Commencement regulations will be required to bring provisions into force, with the exception of provisions on trade unions and industrial action, which will come into force two months from the day on which the Act is passed, and the repeal of the Strikes (Minimum Service Levels) Act 2023 and related provisions, which will come into force on the date the Act is passed.
What does the Bill plan to do? The Bill implements a large number of the reforms promised in the Labour Party’s New Deal document. Alongside the Bill, the government has also published a policy document entitled Next Steps to Make Work Pay (Next Steps) and a set of explanatory notes. The document sets out the government’s plan generally as well as the next steps in implementation for many of the measures.
Laid out below is a summary of the current position, the changes promised prior to the Bill and the expected reforms in relation to the measures set out in the Bill.
Zero hours and ‘low hours’ contracts: Zero-hour contracts are contracts of employment which lack a minimum number of guaranteed working hours and which do not require a minimum commitment from the employee. This means the working hours of an individual are unpredictable and may vary wildly from week to week. Although, individuals on zero-hour contracts do have a number of statutory protections, these are based solely on employment status. At present there is no definition as to what ‘low hours’ means. This will be the subject of consultation.
In order to provide more security for individuals on zero-hour contracts, the Labour Party promised to:
ban ‘exploitative’ zero hours contracts;
ensure a right to a contract reflecting the number of hours regularly worked and is likely to be based on a 12-week reference period;
ensure workers get reasonable notice of any shifts or working time changes, with proportionate compensation for cancelled or shortened shifts;
introduce anti-avoidance measures; and
end ‘one sided’ flexibility by ensuring all jobs provide a baseline level of security and predictability.
The Bill sets out a right to guaranteed hours where a worker regularly works more than those hours. The guaranteed hours are calculated according to a reference period, which is expected to be 12 weeks. Employers will be required to make an offer of guaranteed hours to workers at the start of employment and at the end of each reference period. Workers can also submit claims to the employment tribunal where an employer has failed to comply with their duty to offer guaranteed hours, or where that offer does not comply with the necessary requirements.
The Next Steps document states that the government intends to consult on the details and to ensure the Bill’s provisions on zero hours contracts are effectively and appropriately applied to agency workers.
Fire and re-hire: Currently, employers wishing to introduce changes to the terms and conditions of an employment contract have the option of terminating the contract (with the requisite notice) and offering immediate re-engagement to the affected employee on new terms. While in government, the Conservative party introduced a statutory Code of Practice on dismissal and re-engagement with guidance on engaging in meaningful consultation and exploring alternatives. However, the Labour Party have since committed to ending ‘fire and rehire’ practices entirely in addition to reforming the existing fire and rehire Code and introducing more effective remedies against abuse.
In place of the Code of Practice, clause 22 of the Bill inserts a new section 104I into the Employment Rights Act 1996, which makes a dismissal unfair where the reason for the dismissal is that:
the employer sought to vary an employee’s contract and the employee did not agree, or
the employer sought to employ another person or re-engage the employee under a varied contract to carry out substantially the same duties.
This will not apply where the employer shows that the reason for the variation was to eliminate, prevent or significantly reduce, or significantly mitigate the effect of, any financial difficulties which at the time of the dismissal were affecting, or were likely in the immediate future to affect, the employer’s ability to carry on the business as a going concern or otherwise to carry on the activities constituting the business, and in all the circumstances the employer could not reasonably have avoided the need to make the variation.
Unfair dismissal qualifying period: Under section 108(6) of the Employment Rights Act 1996 the right not to be unfairly dismissed generally only arises where the employee has been continuously employed for a period of at least two years; however the rule is subject to a number of statutory exceptions. The Labour Party has promised to remove the two-year qualifying period for unfair dismissal claims, making it a ‘day one’ right.
The Bill will repeal s.108 of the Employment Rights Act 1996 and remove the two-year qualifying period. However, there will be a new ‘initial period of employment’ (or ‘probationary period’) during which the employer can dismiss an employee for certain reasons, subject to following a specified procedure. The length of the initial period and the details of the procedure will be subject to consultation—see Probationary periods below.
Sick pay (SSP): SSP is currently available to employees who are deemed to have been too ill to undertake any work for a period of at least four consecutive days. Employees must also earn above the lower weekly earnings limit (currently at £123) in order to qualify for SSP. The Labour Manifesto laid out the Party’s commitment to removing the qualifying period for statutory sick pay making it also a ‘day one’ right and removing the lower earnings limit. The Bill reflects both these promises in clauses 8 and 9.
The government will consult on the percentage replacement rate for those earning below the current flat rate of SSP, before bringing it into force as an amendment to the Bill. Furthermore, the Next Steps document states that the new Fair Work Agency will be given responsibility for ensuring SSP enforcement.
Parental leave: Parents of a child (whether born to the parents or adopted) are entitled to take up to 18 weeks of unpaid leave to care for that child at any time before the child’s 18th birthday. Currently parents must have worked continuously for an employer for at least one year to qualify for parental leave. The Bill will make parental leave a ‘day one’ right.
Probationary periods: As noted above, the Bill introduces the concept of an ‘initial period of employment’ (or ‘probationary period’) where dismissals for specified reasons will not be considered unfair. The government has further committed in the Next Steps document to consulting on the length of that initial statutory probation period and to consult on how it interacts with ACAS’s Code of Practice on disciplinary and grievance procedures to ensure that ‘day one’ rights will not be affected by the statutory probation period.
Flexible working: The Employment Rights Act 1996 provides employees with a statutory right to request certain specified changes to their employment contract. However. employees must have had at least 26 weeks’ of continuous service in order to qualify for the right. Earlier legislative changes were made from 6 April 2024, including making the right to request a day one right. However, the grounds upon which an employer can reject a request remain broad.
The Bill introduces a reasonableness requirement into an employer’s decision not to grant flexible working requests, and requirement for the employer to explain to the employee why they consider it reasonable to refuse the request.
Protection for new mothers: Currently, dismissal on the grounds of pregnancy or maternity will be deemed to be an automatically unfair dismissal. This means that an employee dismissed under these circumstances does not require the two years of continuous employment ordinarily needed to bring a claim in the employment tribunal. A woman who takes ordinary maternity leave is also entitled to return to the ‘same job’ at the end of that leave unless that job is no longer available.
The Plan to make work pay also included a promise to strengthen these protections by making it unlawful, except in specified circumstances, to dismiss a woman who has had a baby for six months after she returns to work.
The Bill provides the Secretary of State with the power to make provision for regulations restricting dismissal of an individual during pregnancy or for a period after pregnancy.
Paternity leave: Currently an employee may take paternity leave to support a mother or adopter in taking care of a new child, subject to (among other things) having at least 26 weeks’ qualifying employment. Under the Bill, paternity leave will become a ‘day one’ right.
Bereavement leave: Employees are entitled to Parental bereavement leave (PBL) following the death of a child if they meet the requisite parental relationship conditions and comply with the notice requirements. PBL is a ‘day one’ right; however it is currently only available to employees. The Bill extends the right to take PBL to any ‘bereaved person’. PBL will no longer be limited to circumstances involving the death of a child. A bereaved person will be entitled to take leave for the death of any person as long as they meet the other relevant conditions set out in the regulations.
Equality action plans: Amendments to the Equality Act 2010 made by the Bill will require large employers (with 250 employees or more) to publish equality action plans showing the steps that the employer is taking in relation to their employees with regard to prescribed matters related to gender equality, and to publish prescribed information relating to the plan. These will need to cover addressing the gender pay gap and supporting employees going through the menopause.
Fair Work Agency: The Labour Party has committed to amalgamating the HMRC National Minimum Wage unit, the Employment Agency Standards Inspectorate and the Gangmasters Labour Abuse Authority into a single enforcement body known as the Fair Work Agency. The Bill establishes the Fair Work Agency which will be responsible for:
minimum wage and statutory sick pay enforcement;
the employment tribunal penalty scheme;
labour exploitation and modern slavery; and
enforcement of holiday pay policy (a new responsibility, which was not originally included in the New Deal document).
Fair pay agreements for social care workers: The Labour Party promised to consult on a new Fair Pay Agreement to create a New Deal for Social Care Workers. The Bill provides for the creation of an Adult Social Care Negotiating Body with a remit over remuneration, terms and conditions of employment and any matters specified by the Secretary of State, for social care workers. Agreements over remuneration which have been ratified by the Secretary of State must be paid in accordance with the agreement and any other term will have effect as a term of a worker’s contract. A consultation on how the Fair Pay Agreement should work is promised ‘soon’.
School support staff: The School Support Staff Negotiating Body, the pay body for school support staff, was abolished some time ago. The Labour Party stated that it would reinstate the Body, and task it with establishing a national terms and conditions handbook, training, career progression routes and fair pay rates for support staff to help to address the recruitment and retention crisis. The Bill re-establishes the School Support Staff Negotiating Body.
Trade unions: The Employment Rights Bill makes provision for changes to trade union law relating to:
a worker’s right to a statement of trade union rights;
a trade union’s right of access to a workplace;
trade union recognition;
members’ contributions to political funds, and public sector check-off arrangements;
time off rights for trade union officials, learning representatives and union equality representatives; and
blacklisting.
An employer will be required to give a worker a written statement that the worker has a right to join a trade union at the same time as the employer gives the worker a written statement of employment particulars. Secondary legislation will stipulate what information must be included in the statement, the form the statement must take and the manner in which the statement must be given.
The Employment Bill introduces a new framework for trade unions to request physical access to an employer’s workplace for the purposes of meeting, representing, recruiting or organising workers, and/or facilitating collecting bargaining. Access agreements are to be negotiated in the first instance between the employer and the trade union, with a referral to the Central Arbitration Committee provided for if agreement cannot be reached.
Thresholds required for a trade union to qualify for, and achieve, statutory recognition will be amended, with double thresholds removed where relevant and replaced by a simplified requirement for unions to demonstrate appropriate levels of support. In relation to individual contributions to a political fund of the trade union, the default position will be that individual members will be contributors to the political fund unless they specifically opt out (rather than the other way around, which is the current position.
Changes to the check-off arrangements for public sector workers introduced by s.15 of the Trade Union Act 2016 on 9 May 2024 are to be repealed.
Where an employer permits an employee or a learning representative to take time off for carrying out their duties under the Trade Union and Labour Relations (Consolidation) Act 1992 (ss.168 and 168A), it will also be expected, if requested, to provide reasonable accommodation and other facilities for carrying out those duties.
A new right for reasonable time off for union equality representatives is introduced to support duties related to promoting equality in the workplace.
Secondary legislation will be introduced to extend blacklisting protections; it will be unlawful not only to compile lists of trade union members etc, but also to use such lists for the purposes of discrimination in relation to recruitment or in relation to the treatment of workers, and/or to sell or supply such lists for those purposes.
Industrial action: Changes are proposed in relation to:
balloting and notification requirements for lawful industrial action
lawful picketing;
detriment and dismissal for participating in lawful industrial action; and
restrictions on those working in regulated services from participating in industrial action.
Ballot participation thresholds will be done away with and support thresholds for industrial action will be the majority of those voting in the ballot. Additional balloting thresholds for those engaged in public services will also be done away with. Information that must be included on the voting paper in a ballot is to be significantly reduced and simplified. Provision is made for electronic balloting to be introduced.
The period of notice to be given to an employer to notify it of industrial action is to be reduced from 14 days to seven days.
Lawful picketing will no longer be dependent on the union supervision requirements contained in s.220A of the Trade Union and Labour Relations (Consolidation) Act 1992, which is to be done away with.
A new right for workers to be protected from detriment for participating in protected industrial action, or to deter them from doing so, is to be introduced, and protection against dismissal for participating in protected industrial action is to be extended.
The Strikes (Minimum Service Levels) Act 2023 is to be repealed, and industrial action restrictions on workers working in services that have been designated ‘relevant’ services under the Act are accordingly lifted.
Further reform: In addition to the anticipated reforms announced in the Labour Party’s New Deal and Manifesto, the Bill includes some measures which had not previously been anticipated. Clauses 16–18 of the Bill contain new provisions on sexual harassment, expanding the duty to prevent sexual harassment set to come into force on 26 October 2024 under the Worker Protection (Amendment Of Equality Act 2010) Act 2023. The new sections introduce:
liability for harassment by third parties;
provision for disclosures about sexual harassment qualifying as a protected disclosure under S.43B of the Employment Rights Act 1996; and
the addition of specified steps that an employer must take to demonstrate that they have taken reasonable steps in the prevention of sexual harassment for the purposes of the legislation.
The government will also consult on lifting the cap of the protective award if an employer is found to not have properly followed the statutory collective redundancy processes and on the role interim relief could play in protecting workers in these situations.
As stated above, the Next Steps document provides a general timeline on the implementation of the measures and reforms set out in the Bill. The majority of the measures in the Bill are set to be brought in through commencement legislation, and a number will go through a consultation process before their eventual implementation. According to the Next Steps document, the government expects to start consulting in 2025, although the government is ahead of itself in this regard and launched four consultations on 21 October 2024. The four consultations, which run until early December 2024, seek views of the Bill’s measures relating to a new right to guaranteed hours for zero or low hours workers, collective redundancy consultation and ‘fire and rehire’ practices, trade union legislation and statutory sick pay. This means that any substantive reforms are unlikely to take effect much before 2026. This also means the Bill is likely to see some amendment before all the measures fully come into force.
The Next Steps document also refers to a number of reforms not included in the Bill which the government is nevertheless committed to introducing. These are:
a full review of the parental leave system;
a review of the implementation of carer’s leave and an examination of the benefits of introducing paid carer’s leave;
a consultation on workplace surveillance technologies;
consultations on the creation and implementation of a single ‘worker’ status;
a call for evidence on TUPE 2006 regulations and processes;
a review of health and safety in the workplace aimed at modernising guidance and regulations;
a joint consultation with ACAS on collective grievances;
the introduction of a new National Procurement Policy Statement aimed at reforming the public procurement ahead of the commencement of the Procurement Act 2023 in February 2025; and
an extension of the Freedom of Information Act 2000 to private companies that hold public contracts and publicly funded employers.
Protection at work: The Worker Protection (Amendment of Equality Act 2010) Act 2023 to comes into force on 26 October 2024 and EHRC updates its harassment guidance and publishes eight-step guide for employers on preventing sexual harassment at work
The Worker Protection (Amendment of Equality Act 2010) Act 2023 comes into force on 26 October 2024. The Act will:
Introduce a duty on employers to take reasonable steps to prevent sexual harassment of their employees.
Give employment tribunals the power to uplift discrimination compensation by up to 25% where an employer is found to have breached the duty to prevent sexual harassment.
At present it’s only a duty to take ‘reasonable steps’, the new Employment Rights Bill already includes a change to ‘all reasonable steps’ which no doubt will come into force in due course. The Employment Rights Bill will also re-introduce employer liability for third party harassment in relation to all relevant protected characteristics under the Equality Act (sex, sexual orientation, age, disability, etc.)
Sexual harassment occurs where both:
A engages in unwanted conduct of a sexual nature.
The conduct has the purpose or effect of either violating B’s dignity, or creating an intimidating, hostile, degrading, humiliating or offensive environment for B.
The EHRC has published an updated technical guidance for employers on the steps they can take to prevent sexual harassment in the workplace. The EHRC has also published an eight-step practical guide to assist with this preventative duty, including developing an effective anti-harassment policy, using a reporting system that allows workers to raise an issue either anonymously or in name, and regularly monitoring and evaluating the effectiveness of an employer’s actions.
Parents: New private members’ bill on Still-Birth and leave for Neo-natal care
The Still-Birth (Definition) Bill (a Private Members’ Bill sponsored by Liberal Democrat peer, Baroness Benjamin) received its first reading in the House of Lords on 14 October 2024. The Bill would amend the definition of still-birth to apply from 20 weeks into a pregnancy, rather than from 24 weeks as currently is the case, including for the purposes of entitlement to maternity allowance under section 35 of the Social Security Contributions and Benefits Act 1992.
Currently under the Neonatal Care (Leave and Pay) Act 2023 (which received Royal Assent on 24 May 2023) employees with responsibility for children receiving neonatal care will be entitled to receive up to 12 weeks of paid leave per year. Regulations bringing into force its main provisions are awaited.
The latest edition of HMRC’s Employer Bulletin confirms that from 6 April 2025 HMRC will begin to administer statutory neonatal care pay (SNCP). The Bulletin informs employers that SNCP:
is claimable in the first 28 days following the birth of a child after they have spent seven consecutive days in neonatal care
can be paid for a maximum period of 12 weeks but will allow some flexibility dependent upon individual parental circumstances and other statutory payments to which they may be entitled.
Pay: New Tipping Act and supplementary Code of Practice comes into force – guidance available
On 1 October 2024, the Employment (Allocation of Tips) Act 2023 and statutory Code of Practice on fair and transparent distribution of tips came into force. Under the Act, employers must distribute tips in a ‘fair and transparent’ manner, passing all tips, gratuities, and service charges on to workers, without deductions. Failure to do so could result in employment tribunal claims by workers seeking to enforce their rights.
The Advisory, Conciliation and Arbitration Service (ACAS) has published guidance on tips and service charges in relation to the Act and supplementary Code of Practice which are both now in force. The guidance explains what the new law says, sharing tips fairly, and the obligation to have a written policy and to keep records. The guidance also covers which tips the law applies to, when tips must be paid, tronc systems and what happens if tips are not being paid correctly.
The DBT has also published non-statutory guidance for employers for employers on distributing tips fairly. The guidance is aimed at helping employers apply the statutory code of practice on fair and transparent distribution of tips, and applies to all sectors and businesses where tips are received. The guidance is not part of the statutory Code of Practice, legal advice or an exhaustive account of what is acceptable under either the Employment Rights Act 1996 or the statutory Code of Practice.
Equality: Office for Equality and Opportunity replaces the Equality Hub
The Equality Hub has been replaced by the Office for Equality and Opportunity. The Office for Equality and Opportunity will cover the overall framework of equality legislation in the UK, including disability policy, ethnic disparities, gender equality and LGBT+ rights.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – September 2024
Employment,
27th September 2024
Employment Law
This month our employment law case updates contain some key issues in employment law: discrimination protections, and the balance between the rights and freedoms of individuals and the effect their words or acts may have on those around them.
Collective Agreements: Supreme Court restrains Tesco from ‘firing and rehiring’ employees on less favourable terms
Unfair Dismissal: Dismissal based on capability and performance is fair
Equality Act: Complaint by LGBT charity about ‘gender critical’ tweets did not induce or cause discrimination
Equality Act: English Nationalist loses appeal for protection of his views
Collective Agreements: Supreme Court restrains Tesco from ‘firing and rehiring’ employees on less favourable terms
In Tesco Stores Ltd v Union of Shop, Distributive and Allied Workers (USDAW) [2024] UKSC 28, in a unanimous decision in which Lord Burrows and Lady Simler delivered the leading judgment, the Supreme Court agreed with the previous High Court decision and restored the injunction restraining Tesco from terminating employment contracts for the specific purpose of depriving employees of their ‘permanent’ contractual right to retained pay and offering re-engagement without this inclusion. It was held that the employment contracts contained an implied term which prevented Tesco from exercising dismissal rights for this purpose.
The Supreme Court allowed the appellant employees’ (and their union’s) appeal, concerning whether the Court of Appeal, Civil Division, had erred in finding that the respondent company (Tesco) had been entitled to terminate its employees’ employment contracts for the specific purpose of depriving them of ‘retained pay’ (RP) (a financial contractual entitlement which was described as a ‘permanent’ benefit), and to offer re-engagement on terms without RP (the ‘fire and re-hire’ mechanism). The High Court had granted an injunction to restrain Tesco from terminating the employees’ employment to remove the RP term. The Court of Appeal had allowed Tesco’s appeal. The court ruled among other things, that: (i) on the true construction of the express RP term in the relevant employment contracts, the word ‘permanent’ conveyed that the right to RP was not time-limited in any way and would continue to be paid to employees for as long as their employment in the same role continued, subject only to the other two qualifications set out in the RP term; (ii) however, applying the test of business efficacy (or obviousness), Tesco was precluded by an implied term from exercising the contractual right to dismiss the claimants on notice for the purpose of removing or diminishing their right to receive permanent RP; (iii) the exception to the general rule that a contract of employment was not specifically enforceable was engaged, in circumstances where there had been no breakdown of mutual trust and confidence (Tesco was prepared to re-engage the relevant employees), and where damages would be inadequate; and (iv) accordingly, the injunction which the High Court had granted in favour of the employees would be reinstated.
Unfair Dismissal: Dismissal based on capability and performance is fair
In Kikwera-Akaka v Salvation Army Trading Company Ltd [2024] EAT 49, the EAT found the Employment Tribunal did not err in concluding that the Claimant had been fairly dismissed for capability and performance. The Claimant worked for the Respondent in one of its charity shops. Many of the staff who work in those shops are volunteers and some have additional vulnerabilities. An incident occurred between the Claimant and a vulnerable volunteer, as a result of which he received a final written warning. That stated that further misconduct may result in dismissal. In addition, he was placed on a personal improvement plan (PIP). The Tribunal found that this was specifically linked to the incident with the volunteer: one aspect of his performance which the Respondent made clear needed to improve through that PIP was his interaction with volunteers. The Claimant did not consider that there was anything which he needed to address in that regard. The PIP ended a few days earlier than planned. The Claimant was invited to a performance capability meeting to discuss the PIP. He was expressly warned that dismissal may result. The Claimant’s position regarding his interaction with volunteers did not change: he rejected the suggestion that he needed to improve or that he required further training. He was dismissed.
The Claimant’s appeal against dismissal, in which he maintained his previous stance, was unsuccessful. On the facts the Tribunal concluded that the Claimant had been given a fair opportunity to improve his performance: his interaction with volunteers was a significant and important part of his performance, and was also linked to the misconduct which led to the final written warning. The Tribunal did not err in its approach or in its application of relevant legal principles. Observations upon the differences, and similarities, in a fair approach when an employer considers dismissal for capability compared to misconduct.
Equality Act: Complaint by LGBT charity about ‘gender critical’ tweets did not induce or cause discrimination
In Bailey v Stonewall Equality Ltd [2024] EAT 119, the EAT held that an Employment Tribunal did not err in rejecting a claim, by a barrister who holds gender critical beliefs, that Stonewall, an LGBT campaign charity, caused or induced her chambers to discriminate against her on the grounds of her protected belief, contrary to section 111 of Equality Act 2010 (i.e. relating to instructing, causing or inducing another person to contravene the Act). The tribunal’s finding that the charity’s complaint was a ‘protest’, without any specific aim in mind except perhaps a public denial of the chambers’ association with the barrister’s views and contained no element of threat, did not satisfy a finding of inducing or causing an act of discrimination.
Equality Act: English Nationalist loses appeal for protection of his views
In Thomas v Surrey and Borders Partnership NHS Foundation Trust (1) and Brett (2) [2024] EAT 141, the EAT ruled that English nationalism is not a legally protected philosophical belief under the Equality Act 2010 (EqA 2010). The Claimant, Steven Thomas, a health worker, has lost his appeal against an employment tribunal’s decision that his belief in English nationalism, which included anti-Islamic views, was not one which was protected under the EqA 2010. This original decision was reached at a preliminary hearing in the claim he brought against a National Health Service (NHS) trust after it ended his employment after three months.
Judge Clive Sheldon KC wrote in the judgment of the EAT: ‘The Claimant’s views are of an English nationalism which believes that there is no place in British society for Muslims or Islam itself… The Claimant is not prevented from holding his views. But he is outside of the right to complain that he has been discriminated against in relation to those beliefs.’
‘English Nationalism can be a legally protected philosophical belief, but the Claimant’s specific views, which included that Muslims should be forcibly deported from the UK, did not merit protection under free expression rights enshrined in the European Convention of Human Rights,’ he added.
This was because his expressed beliefs violated another right in the doctrine—that no one can perform acts ‘aimed at the destruction of any of the rights and freedoms’ of others, and, added the judge, he cannot also claim protection from discrimination under the EqA 2010 because his views are not worthy of respect in a democratic society.
Thomas’ solicitor, Robin Tilbrook of Tilbrook Solicitors, said that his client will take his case to the Court of Appeal, or to the European Court of Human Rights if necessary. Tilbrook said he believed the judgment misinterpreted the European Convention article that limits Thomas’ free speech rights as binding on the employer, rather than on the state. He likened Thomas’ case to Redfearn v United Kingdom [2013] IRLR 51, where another English Nationalist won his European human rights case despite losing his employment claim in the UK.
His past political affiliation to the English Democrats, a minor far-right party, meant that Thomas was sanctioned because his beliefs were ‘unacceptable to the woke view of the world’, Tilbrook added. Tilbrook is the current national chair of the English Democrats.
‘In this case, there are comments about Islam that have taken my client’s views out of that protection’, Tilbrook said. ‘They have put my client in a position where he’s always in danger of being fired by an employer.’
The case is part of a surge in claims about protected beliefs that lawyers say are incrementally blurring the lines between unconventional but legally valid views and politicised public debates.
The trust argued in June that Thomas’ views were ‘akin to Nazism‘, which British courts have ruled is not protected. They also defended the employment tribunal claim on the basis that he was actually dismissed because he lied in his résumé about an unspent conviction.
Thomas had either posted himself, or reposted, on social media platform X, comments such as ‘Ethnic cleansing…always happens to Muslims…wonder why?‘ and used the hashtag ‘#RemoveAllMuslims’, according to the judgment of the employment tribunal.
Oscar Davies of Garden Court Chambers, counsel for Thomas, argued in written submissions in the appeal case that the views of the claimant ‘might well be considered offensive and abhorrent to some’—but did not seek to destroy the rights of anyone.
As such, they did not violate the European Convention on Human Rights, Davies added.
But Sheldon J upheld the employment tribunal’s reasoning for dismissing the case.
‘A finding that the claimant’s beliefs included the banning of Islam or the forcible removal of Muslims from the United Kingdom is only consistent with an infringement—and in fact the destruction—of rights of others’, he ruled.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – July 2024
Employment,
26th July 2024
Employment Law
This month’s case digest covers how to compare workers in cases of less favourable treatment, considering different aspects of unfair dismissal claims, the intricacies of holiday pay accrual, and when time spent doing something work-related is not actually working time for the purposes of pay and therefore the National Minimum Wage.
Worker Status: Less favourable treatment on ground of part-time working
Unfair Dismissal: Care workers’ vaccine preference can’t top residents’ safety
Unfair Dismissal: ET made inadequate findings on employer’s search for suitable alternative employment
Holiday Pay: EAT considers Coronavirus and Shimizu carry-over claims
National Minimum Wage: Time spent travelling on employer’s minibus to and from place of work is not ‘time work’
Worker Status: Less favourable treatment on ground of part-time working
In Augustine v Data Cars Ltd [2024] EAT 117, the EAT held that a part-time taxi driver was treated less favourably by the employer’s application of a £148 per week flat rate circuit fee because, applying the pro rata temporis principle, the claimant was:
paying a higher circuit fee than his full-time comparator when considered as a proportion of his hours worked, and/or
was taking home a lower hourly rate of pay.
The principle of pro rata temporis means whereby when a comparable permanent employee is employed with specific terms and conditions of employment, the fixed-term employee will be employed with the same terms and conditions of employment, based on a comparison of the period of employment of the comparable permanent employee and the fixed-term employee respectively.
However, because the part-time working was not the ‘sole’ reason for the less favourable treatment, the imposition of the flat rate fee did not breach the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, SI 2000/1551. While the EAT preferred the test on causation set out by the EAT (England) in Sharma v Manchester CC [2008] IRLR 336 and Carl v University of Sheffield [2009] IRLR 616 (that the part-time working has to be the ‘effective and predominant’ cause of the less favourable treatment) it nonetheless applied the test set out by the Inner House of the Court of Session (CSIH) (Scotland) in McMenemy v Capita Business Services Ltd [2007] IRLR 400 (that the part-time working has to be the sole cause of the less favourable treatment) because it recognised the legitimate public interest in having a consistent approach in cases both north and south of the Scotland/England border.
Unfair Dismissal: Care workers’ vaccine preference can’t top residents’ safety
In Masiero and Others v Barchester Healthcare Ltd [2024] EAT 112, the EAT has agreed that a healthcare provider’s mandatory coronavirus (COVID-19) vaccine policy did not infringe a group of care home workers’ human rights, ruling that they were fairly dismissed because the company had a right to protect its residents.
In particular, the EAT held that the employment tribunal had been entitled to find that:
the claimants’ dismissals were compatible with their rights under the European Convention on Human Rights and the Human Rights Act 1998;
the respondent’s policy did not involve the imposition of a mandatory requirement to submit to medical treatment in abrogation of the claimant’s right to free and informed consent;
the interference with the claimants’ Article 8 rights was justified in pursuit of the respondent’s aims of (among other things) protecting care home residents’ rights to life under Article 2.
Unfair Dismissal: ET made inadequate findings on employer’s search for suitable alternative employment
In Birkett v Integral UK [2024] EAT 107, the EAT held that the employment tribunal had made insufficient findings in respect of:
the respondent’s process of searching for alternative jobs, at the time of the claimant’s dismissal, and
the circumstances in which the claimant was unsuccessful for a specific vacancy, for which he had been interviewed.
Both issues were relevant to the fairness of the claimant’s dismissal for the purposes of section 98(4) of the Employment Rights Act 1996:
merely to state a conclusion on a disputed point that there were, for example, no vacancies, without any analysis of, and findings on, the respondent’s enquiries, was not sufficient;
if findings are not made about the basic fairness of the recruitment process, the risk is that it would be open to any employer to absolve itself of liability by offering an interview, without a wider analysis of the fairness for the purposes of Employment Rights Act 1996, s 98(4).
Holiday Pay: EAT considers Coronavirus and Shimizu carry-over claims
In Knight v Off Broadway Ltd [2024] EAT 109, the claimant, a bar manager, brought claims that, in addition to a payment in lieu of holiday accrued in the leave year in which his employment terminated, he was also entitled to carry-over unused holiday from previous years.
The EAT held that the employment tribunal had:
correctly found on the facts of the case that there were no Covid-related circumstances which entitled the claimant to carry-over unused holiday entitlement under the then in place (but now withdrawn) amendments to the Working Time Regulations 1998, SI 1998/1833 (WTR 1998);
erred in failing to consider whether the respondent had done sufficient to inform the claimant, in particular, that any unused holiday at the end of the holiday year could not be carried over (see Max-Planck-Gesellschaft zur Főrderung der Wissenschaffen e.V. v Shimizu [2018] All ER (D) 30 (Nov), the principles from which have now been incorporated into the WTR 1998).
HHJ Auerbach noted that in Shimizu the Court of Justice of the European Union referred to the employer being required to ensure that the worker is actually in a position to take the paid annual leave to which he is entitled by encouraging him ‘formally if need be’ to do so, while ‘informing’ him in good time that leave not taken during the holiday year will be lost. He said that would be sufficient in the given case to satisfy that obligation will be a fact-sensitive matter for the tribunal.
National Minimum Wage: Time spent travelling on employer’s minibus to and from place of work is not ‘time work’
In Taylors Service Ltd v Commissioners for HM Revenue and Customs [2024] EAT 102, HMRC issued the respondent (a company providing labour to poultry farms around the country) with a notices of underpayment of the national minimum wage because it did not pay its workers on zero hours contracts for time spent travelling on its minibuses from their home addresses to and from farms. The respondent appealed, first to the employment tribunal which dismissed the appeal, and then to the EAT.
The EAT allowing the appeal, holding that:
the approach taken by the Supreme Court in Royal Mencap Society v Tomlinson-Blake [2021] IRLR 466 to the interpretation of the National Minimum Wage Regulations 2015 (NMW 2015), SI 2015/621, regs 30 and 32 also applies to regs 30 and 34 and, accordingly, time spent ‘just’ travelling is not ‘time work’ for the purposes of reg 30 unless it is deemed to be such by reg 34;
as the tribunal in this case had found that the workers were not working in the ordinary sense when on the minibus, and were not deemed to be engaged in time work by virtue of reg 34, the only conclusion open to the tribunal on the facts as it found them to be was that the workers were not engaged in ‘time work’ for the purposes of NMW 2015, SI 2015/621, reg 30.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – March 2024
Employment,
24th March 2024
Employment Law
This month’s case updates include a case of unfair dismissal which sparked a debate over the bounds of reasonable responses of an employer in dismissing an employee for posting a racist ‘joke’ on an intranet, we scrutinize parental leave protection against dismissal, look at whether employers can be held vicariously liable for detriments amounting to dismissal caused by co-workers in whistleblowing cases, and take a look at the potential discrimination of a Christian actor removed from a role due to anti-gay social media posts, although she admitted she would never had played that role anyway. Lastly, looking at Equal Pay, we investigate the ‘material factor defence’.
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.
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.
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.
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.
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.
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.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
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
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’.
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.
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.
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;
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.
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).
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – September 2023
Employment,
21st September 2023
Employment Law
This month we bring you a plethora of interesting cases centring around dismissal in all its forms – be they agreed, part of a restructure or initiated for a reason. The questions will always be: is that reason fair and/or have you followed the correct procedure? Have a look at our case run down here.
TUPE: Employment decision on when a TUPE transfer takes place
Redundancy: Employees in restructure did not unreasonably refuse suitable employment
Unfair Dismissal: Direct Line beats claims advisers case over agreed exit
Unfair Dismissal: Conclusion on the fairness of a dismissal must be based on the established reason for that dismissal
Sex Discrimination: Tribunal’s misstatement of grievance outcome materially impacted on its consideration of the claim
TUPE: Employment decision on when a TUPE transfer takes place
In Rajput v Commerzbank and Société Générale [2023] EAT 116 the EAT held that (i) in a ‘series of transactions’ cases, the transfer does not necessarily take place at the end of the series, and (ii) when determining the date of the transfer, a tribunal can have regard to matters which occur outside the UK. Regulation 3(1)(a), which provides that the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006), SI 2006/246 apply to undertakings which are ‘situated immediately before the transfer in the UK’, does not mean that a tribunal must focus solely on events which take place within the UK-businesses which are situated in the UK.
Sarah Clarke, barrister at 3PB, who represented the claimant in this appeal, writes in a case analysis for Lexis Nexis that, on the face of it, the EAT’s finding that a transfer can take place at any point within the ‘series of transactions’ could cause uncertainty and increase the amount of litigation in this area. However, she goes on to say that she considers that, in the vast majority of cases, a transfer will take place at the end of the series. The question to be determined is when responsibility for the carrying on of the business transfers to the transferee and it is difficult to envisage many situations in which responsibility would transfer over prior to the end of the transactions. Indeed, as a matter of logic, if a transfer is ‘effected’ by a series of transactions, it cannot be until the last of those transactions that the transfer is complete, as otherwise the later transactions could not have ‘effected’ the transfer. However, this argument was rejected by the EAT and, in her view, there is scope for further judicial consideration of this.
In relation to the location of the business, this case makes it clear that, when determining when a transfer takes place, a tribunal’s focus ought not to be solely on those matters which occur in the UK. The relevance of geography to TUPE is simply that the business must be situated in the UK immediately before the transfer takes place. However, this does not preclude the business operating from other locations outside the UK. Thus, when dealing with this issue, parties must ensure that they provide evidence to the tribunal which clearly explains all matters relevant to the transfer, regardless as to where in the world those events took place.
The claimant was employed by Commerzbank (CB) from 2012 as a senior compliance officer. She was dismissed in March 2020 and brought various claims, including automatic unfair dismissal (on the basis that the sole or principal reason for her dismissal was the TUPE transfer) and victimisation (following a previous successful discrimination claim she had brought against CB). She had worked within the Equity Markets and Commodities Division (EMC) of the business, which was sold to Société Générale (SG), following a business purchase agreement which was signed in November 2018.
The EMC business was divided into three divisions, namely Flow Trading, Asset Management (AM) and Exotics, Vanilla and Funds (EVF), and was spread across several countries, including the UK, Luxembourg and Germany. The claimant worked across all three divisions.
For the purpose of the business sale, each division was (i) allocated its own purchase price, and (ii) divided into sub-batches, which transferred over a period of time. The EVF division transferred over in six batches from March to October 2019, with AM transferring over from May to November 2019. The last part of the EMC business to transfer over was Flow. It was based mainly in Germany, with only a small presence in London consisting of five employees. Most of Flow had transferred over by March 2020, with the remainder transferring in May 2020.
The employment tribunal found that the transfer took place on 1 October 2019 on the basis that 95% of the UK operation had transferred over by then. The judge thus ignored the last division which transferred over, as this was based predominantly in Germany.
The EAT, Mr Justice Kerr sitting alone, concluded that:
‘…there is no presumption or rule that a transfer effected by a series of transactions occurs at the end of the series. Completion may be artificially delayed. The last transaction in the series may be a minor detail, putting the last piece of the jigsaw in place long after the transferee has started running the business to the exclusion of the transferor.’
However, he agreed that the judge had erred in excluding from his consideration the Flow part of the business. The question to be determined was when responsibility for the carrying on of the business was transferred to the transferee (CELTEC v Astley). It was an agreed fact that Flow formed ‘part of the organised grouping of resources’ which comprised the EMC business. There was no reason why an ‘organised grouping of resources’ (in the words of TUPE 2006, SI 2006/246, reg 3(2)) could not be located across several countries at once. A business or part of a business can be ‘situated’ in the UK without its entire operation being located in the UK. He concluded that ‘there is nothing in the TUPE Regulations that required the tribunal to confine its consideration to the part of the organised grouping of resources based in this country.’
Redundancy: Employees in restructure did not unreasonably refuse suitable employment
In Mid and South Essex NHS Foundation Trust v Stevenson [2023] EAT 115 the EAT had to consider whether the respondent had been entitled to refuse to make redundancy payments to the claimants where the employment tribunal had held that the alternative roles offered to them were ‘suitable’ but that their rejection of them was not unreasonable due to their personal perceptions of those roles.
The EAT held that there was no error in the employment tribunal’s approach:
— the relevant statutory test is whether the claimants ‘unreasonably’ refused an offer of employment that was suitable to them (the suitability of the role is not in and of itself determinative)
— even though the claimants’ perception of the roles was objectively groundless, the employment judge had found that there was a sufficient basis for their personal perceptions of the roles (eg that they would be a loss of autonomy and status) for them not to have acted unreasonably in refusing them
Unfair Dismissal: Direct Line beats claims advisers case over agreed exit
Insurer Direct Line has successfully defended a case by a claims adviser that it unfairly dismissed him, with the EAT ruling that the employment tribunal had been entitled to find that there was no dismissal because the employee had mutually agreed to terminate his employment after his mental health problems meant he could not work.
In Riley v Direct Line Insurance Group plc [2023] EAT 118, the EAT ruled that an employment tribunal was entitled to find that Matthew Riley had consented to leaving his job. This is because he knew that he would receive lifetime insurance payments after being left unable to work due to mental health problems stemming from autistic spectrum disorder.
His Honour Judge (HHJ) Murray Shanks said the employment tribunal did not err when it rejected Riley’s case that he was duped into terminating his employment. ‘There was ample evidence for the conclusion reached, and the tribunal considered in detail whether Mr Riley’s consent was freely given’, he said. HHJ Shanks added that the tribunal ‘went to considerable lengths to emphasise their conclusions that Mr Riley was not tricked or coerced in any way and that he participated in the discussions, was given time and fully understood what he was doing’.
Riley was absent from work from 2014 until October 2017 due to anxiety and depression, according to the judgment. He began to make a phased return—but was again left unable to work from May 2018 because of anxiety and paranoia, the judgment says. He met with managers in August 2018 and September 2018, when he discussed leaving the job and relying on an insurance policy with UNUM that would make payments equating to 80% of his salary until he reached retirement age, according to the judgment.
Direct Line notified Riley in September 2018 that he was being dismissed following a meeting at which UNUM confirmed that he would be entitled to the benefits of the policy, the judgment says. Riley launched a case at the employment tribunal later that year, lodging claims of unfair dismissal and disability discrimination over allegations that he had been tricked by managers, according to the judgment.
But the tribunal dismissed his case in 2019, rejecting Riley’s evidence that he was put under pressure and did not understand what he was being told by managers. It also found that Riley had told managers that he knew terminating his employment to rely on the insurance policy was ‘where it’s been heading for the last four years’, according to the appeal judgment. The tribunal also concluded that Riley’s discussions with managers about his leaving had been supportive and designed to help him make the right decision.
John Platts-Mills, of Devereux Chambers, Riley’s counsel, argued before the EAT that the tribunal had failed to address the questions of who really terminated their client’s employment and whether the claims adviser really gave ‘true, mutual consent’, according to the appeal judgment.
But HHJ Shanks rejected the argument, ruling that the tribunal had ‘considered evidence relating to this in detail’. ‘It is true that they did not expressly refer to his disability in this context, but they must have had it well in mind when they rejected his evidence that he did not understand what was being said at meetings and found that he had made a fully informed decision’, he said.
Unfair Dismissal: Conclusion on the fairness of a dismissal must be based on the established reason for that dismissal
In Greater Glasgow Health Board v Mullen [2023] EAT 122, the EAT dismissed the employer’s appeal against the decision of the employment tribunal which found that the employer’s reason for dismissing their employee was a belief by it in the existence of misconduct consisting of aggressive and threatening behaviour by him to one of his line reports. The tribunal further concluded that the employer’s belief in the existence of that misconduct was genuinely held and reached after reasonable investigation. The issue was whether the tribunal had erred in their decision.
The EAT held, among other things, that: (i) in the circumstances it was not open to the employment tribunal to base its conclusion about the fairness of the dismissal in terms of section 98(4) of the Employment Rights Act 1996 on a factual hypothesis that the ‘real reason’ for the dismissal was something different to the established reason; and (ii) on the findings in fact made by the employment tribunal, the only conclusion to which they could properly have come was that dismissal was within the range of reasonable responses open to the employer and was fair. Consequently, the employment tribunal’s judgment was set aside, and the claim of unfair dismissal was dismissed.
Vicarious Liability: School not liable for acts of work experience student
In MXX v A Secondary School [2022] EWHC 2207 (QB) the Court of Appeal upheld the High Court’s decision that the defendant, a co-educational secondary school providing education for children aged 11 to 16, was not vicariously liable for the sexual assaults carried out by PXM on the claimant (a pupil), subsequent to PXM undertaking a work experience placement at the school. The court held that the judge had been wrong to have found that the relationship between the defendant and PXM was not akin to employment but that:
— given the limited nature of PXM’s role during the course of one week (eg he had no pastoral responsibility), the facts did not begin to satisfy the requirements of the close connection test
— the grooming which led to the sexual offending was not inextricably woven with the carrying out by PXM of his work during his week at the defendant’s school such that it would be fair and just to hold the defendant vicariously liable for the acts of PXM.
Disability Discrimination: Tribunal rules insurer discriminated against menopausal worker
A British insurance company has been ordered to pay one of its former workers £64,645 after the tribunal found it failed to make reasonable adjustments for an employee with menopausal symptoms, who later resigned.
In Lynskey v Direct Line Insurance Services Ltd ET/1802204/2022 and ET/1802386/2022, Employment Judge Wade found that Direct Line Insurance Services Ltd did not fully consider the impact of menopause on Maxine Lynskey when it launched a warning and disciplinary process based on her performance. ‘At that time the disadvantage the claimant faced in doing her job while struggling with menopausal symptoms ought to have been recognised as such and adjustments made’, Judge Wade wrote.
The insurer must pay the sum to Lynskey to account for a range of factors, including damages for injury to feelings as well as losses she suffered, according to a remedy judgment. These events are a ‘serious and sustained number of contraventions over a period involving both the claimant’s line manager and her line managers and HR’, the tribunal found.
Lynskey was a motor sales consultant for Direct Line from April 2016. She had ‘very good’ performance ratings in that role. She then informed her manager at a meeting she was having health issues related to menopause.
‘It was clear from the information the claimant provided that she was being profoundly affected by menopausal symptoms and was seeking treatment for them; that was apparent from March 2020’, Judge Wade wrote.
Lynskey then moved to a different team considered to be a ‘better fit’ in light of her personal and health circumstances, albeit one that did not involve a sales related bonus. However, the tribunal found that with this new role, Lynskey’s managers should have been aware of health issues that would affect her performance. ‘The respondent knew, or ought reasonably to have known, from March 2020, that the claimant had become a disabled person by reason of menopausal symptoms’, Judge Wade wrote. ‘She was self-evidently at a disadvantage in comparison with colleagues without her disability in meeting the respondent’s performance standards and targets, and generally more likely to be sanctioned or face disciplinary/performance warnings.’
Lynskey began underperforming, and was told she wouldn’t receive a pay rise because her performance was rated ‘need for improvement’, the judge wrote. The tribunal ruled that it was unfavourable treatment to score her performance without fully factoring in her disability. ‘Need for improvement is inherently unfavourable if the person, through disability, cannot, in fact, improve, or meet the required standards’, it said. She later faced a warning meeting where her manager ‘failed to recognise or take in the explanations’ around her symptoms. Lynskey then faced a disciplinary meeting where her health condition was not fully considered. Judge Wade found that the subsequent disciplinary warning ‘was unfavourable treatment because of something arising in consequence of disability’.
‘It is clear a less discriminatory approach could have been taken, including occupational health referral, consideration of other roles, and accepting the claimant’s mitigation, namely her disability’, the judge wrote.
After a period of ill health and personal issues outside work, Lynskey’s sick pay was stopped, the ruling said. She then submitted a grievance to her employer before ultimately resigning in May 2022, then brought constructive unfair dismissal and Equality Act 2010 complaints against the insurance company.
The tribunal upheld Lynskey’s arguments that Direct Line failed to make reasonable adjustments for her, as well as her complaints about discrimination because of her menopause symptoms. It rejected her complaints relating to constructive unfair dismissal, sex and age.
The tribunal handed down an extempore judgment (given verbally at the end of the case, not written down) on 28 April 2023, and Direct Line requested the written reasons, which were published on 25 August 2023.
Sex Discrimination: Tribunal’s misstatement of grievance outcome materially impacted on its consideration of the claim
In Iourin v The Chancellor, Masters and Scholars of the University of Oxford [2023] EAT 108 the EAT considered a number of appeals against an employment tribunal’s decision dismissing the claimant’s claims for direct sex discrimination, victimisation, and disability discrimination against the respondent under the Equality Act 2010.
The claimant had attempted to hug and kiss a colleague when they were in a car together. She raised a grievance and the grievance committee held that this conduct was unwanted but that, in the context of their relationship, it did not amount to harassment or sexual harassment. The claimant was however required to undergo training related to harassment, which he claimed was sex discrimination.
In finding that this did not amount to sex discrimination, the employment tribunal had made a material error of law by relying on its mistaken account of the grievance committee’s finding—stating that it was harassment but not sexual harassment—in reaching its conclusion that this was the non-discriminatory reason for the training requirement. That claim was therefore remitted to the employment tribunal for rehearing.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – July 2023
Employment,
25th July 2023
Employment Law
A round-up of the most significant employment law cases to be published over the last month, and it’s a varied bag. We look at what lead to an interim injunction before a disciplinary hearing, whether it was lawful for the government to revoke legislation without consultation, whether a person can have two employers at the same time for the same work, whether a dismissal meeting is always needed to ensure a fair process and how a lay tribunal member could be considered to have been biased.
Injunctions: Witnesses and disclosure of documents at disciplinary hearings
Strikes: Could the government revoke legislation to prevent strikers being replaced by agency staff?
Worker Status: Can a person have two different employers at the same time for the same work?
Unfair Dismissal: Lack of dismissal meeting does not render dismissal unfair
Tribunals: Apparent bias in case of lay member posting on social media
Injunctions: Witnesses and disclosure of documents at disciplinary hearings
In Colbert v Royal United Hospitals Bath NHS Foundation Trust [2023] EWHC 1672 (KB), the Claimant, Dr Serryth Colbert, was a consultant in oral and maxillofacial surgery, employed by the Defendant, the Royal United Hospitals Bath NHS Foundation Trust. The Claimant was the subject of disciplinary proceedings brought by the Defendant following allegations that he intimidated and bullied colleagues and other allegations of misconduct. The Claimant issued proceedings on 30 May 2023 seeking an interim injunction relating to the conduct by the Defendant of the disciplinary process.
This case involved two issues in dispute: 1) whether the Claimant had a right to require the attendance of individuals at a disciplinary hearing, who were interviewed as part of the investigation of allegations against him, but who the Defendant was not proposing to call to give evidence, and 2) whether the Claimant was entitled to disclosure of specific documents as part of the disciplinary process, and in particular to an unredacted report that had been produced into alleged misconduct in his department. The Claimant claimed that the way the Defendant had dealt with those two matters breached express contractual obligations, contained in two documents which he contended formed part of his contract: (1) “Maintaining High Professional Standards in the Modern NHS” (“MHPS”) published by the Department of Health; and (2) “Managing Conduct Policy” (“MCP”), the Defendant’s policy for dealing with allegations of misconduct.
In December 2020, the Defendant commissioned an external review to examine the department in which the Claimant worked following allegations having been raised of inappropriate workplace behaviour. A report was produced in February 2021 (“the Atkinson Report”) by the external reviewer, and considered the behaviour of a number of individuals, including the Claimant, and made recommendations, one of which was that the Claimant should be investigated for alleged bullying / inappropriate behaviour. The Claimant was excluded from work from 8 March 2021 while an investigation was carried out (conducted pursuant to the MHPS). An external report was commissioned involving the interviewing of 21 witnesses, including the claimant, and a further report submitted in December 2021 (“the Cunningham Report”). The Report made a number of critical findings about the Claimant including that he had displayed intimidating and bullying behaviour towards a number of colleagues.
On 16 December 2021 a letter was sent to the Claimant with the outcome of the investigation, concluding that the Claimant had a case to answer in relation to a series of allegations, and that the matter would proceed to a disciplinary panel, to be held in January 2023, in accordance with the Defendant’s MCP. The letter stated who would be called as witnesses for the Defendant and who else would be giving evidence, and invited the Claimant to identify who he would be calling, and enclosed a number of documents including the Cunningham Report and a redacted copy of the Atkinson Report (the redactions relating to the other individuals identified by the report).
In January the Claimant wrote back to state the Claimant required that 11 named individuals, described as “management witnesses”, should be present so they could be questioned, and that the Claimant intended to call “around 30 additional witnesses subject to their availability”, and asked for the hearing date to be rescheduled. The Defendant responded by acceding to a later hearing date (May) but declined to provide the 11 witnesses, other than Ms Cunningham who had prepared the second report, and said that he had received all the relevant documents, and the redacted parts of the Atkinson report related only to other members of staff and were not relevant to this investigation.
The Claimant sent a letter before claim setting out:
1. Grounds: The alleged Breaches of Contract by the Defendants are the failure to follow its disciplinary procedures, and to hold a disciplinary hearing in accordance with the Claimant’s contractual rights. These rights are confirmed in the doctor’s employment contract, in [the MHPS] and in the [MCP].
2. The failure to require the Defendant’s primary witnesses to attend the disciplinary hearing so that they can be cross examined by the Claimant’s chosen representative.
3. The failure to allow the Claimant to bring his chosen representative to represent him at the hearing in breach of the amended procedure.
4. The failure to disclose documents pertaining to the disciplinary case in line with MHPS.
The Defendant declined to agree and due to the tight schedule that the letters had caused prior to the rescheduled May disciplinary hearing, the Claimant issued an interim injunction for breach of the Claimant’s contract – the order sought to ensure un-redacted disclosure of all documents, to ensure that all the Defendant’s management witnesses attend the disciplinary hearing and the Claimant’s chosen representative was allowed to represent him at the disciplinary hearing and conduct cross-examination.
In the High Court, (King’s Bench Division) the judge held that, on the correct reading of the Defendant employer’s policy for dealing with allegations of misconduct (the MCP), the employee did not have an unqualified right to insist that any ‘management witness’ could be required to attend a disciplinary hearing to be cross-examined. Accordingly, the court dismissed the employee’s application for an interim injunction. The employee had sought the injunction to ensure unredacted disclosure of all documents, and to ensure that all the defendant’s management witnesses attended the disciplinary hearing, so that they could be cross-examined, and he had contended that the employer had breached express contractual obligations.
The court held that there was no serious issue to be tried, because: (i) the claimant had no real prospect of establishing that his interpretation of the relevant paragraph of the MCP (namely that it meant that the employer had to ensure the attendance at any rescheduled disciplinary hearing of all management witnesses, so that they can be subject to cross examination) was correct; and (ii) there was a good argument that the proceedings should run their course before it would be appropriate for the court to intervene, in circumstances where it was settled law that courts should not become involved in the ‘micromanagement’ of disciplinary proceedings. Further, the court held that the employee had no real prospect of establishing that an investigative report that a Trust had commissioned into a department at a hospital constituted ‘correspondence’, as the word was ordinarily understood or as it was intended to be used in the MHPS. Moreover, there was no real prospect of his establishing that ‘relevant’ material had been withheld from the employee and, even if the report amounted to correspondence, he would not have an unqualified right to have the unredacted report disclosed to him.
Strikes: Could the government revoke legislation to prevent strikers being replaced by agency staff?
In R (on the application of ASLEF and others) v Secretary of State for Business and Trade [2023] EWHC 1781 (Admin) the High Court considered whether it was lawful for the government, without consultation, to revoke legislation which prevented workers on strike being replaced by agency workers. From 1976 it was unlawful for an employment business knowingly to introduce or supply workers to an employer to carry out the work of employees who were taking part in official industrial action. Regulations made pursuant to section 5 of the Employment Agencies Act 1973 and most recently regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (SI 2003/3319 – “the 2003 Regulations”), made this a criminal offence.
In 2015, the Government conducted a public consultation on a proposal to revoke regulation 7. The majority of the responses did not favour this change in the law and, in 2016, it was decided not to go ahead. In June 2022, however, the Government decided, in the context of industrial action in the rail sector and other anticipated industrial action, that regulation 7 would be revoked without further public consultation. On 27 June 2022, the draft Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2022 (SI 2022/852 – “the 2022 Regulations”) were therefore laid before Parliament, regulation 2(a) of which implemented this measure. The 2022 Regulations were made by the then Secretary of State for Business, Energy and Industrial Strategy (“BEIS”), Mr Kwasi Kwarteng, on 20 July 2022 and they came into effect on 21 July 2022.
Thirteen trade unions challenged the then Secretary of State’s decision to make the 2022 Regulations. The challenge is on two grounds:
that he failed to comply with his statutory duty, under section 12(2) of the 1973 Act, to consult before making the 2022 Regulations (“Ground 1”).
it is contended that, by making the 2022 Regulations, the Secretary of State breached his duty, under Article 11 of the European Convention on Human Rights (“ECHR”), to prevent unlawful interference with the rights of trade unions and their members (“Ground 2”).
The High Court confirmed that the challenge succeeded on the basis of Ground 1 and quashed the Regulations. In particular, it found that the decision to revoke the legislation preventing the use of agency workers in place of striking workers “was not informed by, or tested against, the views of and the evidence of bodies which were representative of the interests concerned”. The Secretary of State could not rely upon consultation which had taken place 7 years earlier on the same point (and was found not to have done so in any event).
The High Court, having upheld Ground 1, decided not to express a view on the more contentious Ground 2.
Worker Status: Can a person have two different employers at the same time for the same work?
In United Taxis Ltd v Comolly [2023] EAT 93, the EAT considered Mr Comolly’s worker status. He is a taxi driver, registered with United Taxis and who then did work driving United Taxis’ passengers, through one of its shareholders, Mr Parkinson, using his taxi. After that relationship came to an end he did work driving United Taxis’ passengers, through another shareholder, Mr Tidman, using his taxi. After that relationship ended he brought various complaints to the employment tribunal asserting that he was either an employee or a worker of United Taxis or Mr Tidman.
The tribunal determined as preliminary issues that Mr Comolly was a worker of United Taxis and an employee of Mr Tidman. On the facts found, the tribunal properly concluded that United Taxis’ passengers’ contracts were, and were solely, with United Taxis. It also properly concluded that, under Mr Comolly’s contract with Mr Tidman, Mr Comolly provided services to him in exchange for payment. United Taxis contracted out the task of conveying its passengers to Mr Tidman, who in turn sub-contracted it to Mr Comolly.
However, the EAT noted that the key cases of Brook Street Bureau v Dacas and Cable & Wireless v Muscat had found the concept of dual employment to be “problematic” and concluded that it could not “see how [the problems] could be overcome”. It therefore found that the tribunal erred in finding that Mr Tidman had a contract with United Taxis under which he also did work for it. There was no necessity to imply such a contract, whether from the fact that he registered with United Taxis, and was required to comply with its rules and byelaws as a condition of being permitted to convey its passengers, or otherwise. The tribunal could also not properly find that he was simultaneously an employee or worker of two employers in respect of the same work.
The tribunal also erred in finding that Mr Comolly’s contract with Mr Tidman was a contract of employment, in particular in its approach to the question of control. In particular, although Mr Tidman controlled when the taxi was available to Mr Comolly, he had no control over what Mr Comolly did during the time that the taxi was available to him. Drawing on its findings of fact, a finding was substituted that Mr Comolly was a worker of Mr Tidman.
Unfair Dismissal: Lack of dismissal meeting does not render dismissal unfair
In Charalambous v National Bank of Greece [2023] EAT 75, the EAT considered the process of dismissal. It found that the lack of a meeting between an employee and the dismissing officer will not in and of itself, in all circumstances, make a dismissal unfair. It found that the decision in Budgen & Co v Thomas [1976] ICR 344 (EAT), was not an authority for the proposition that a dismissing officer must always have direct communication with an employee in order for a misconduct dismissal to be fair. Such a meeting is desirable and good practice but what is essential is that the employee is given the opportunity to ‘say whatever he or she wishes to say’ and there is nothing to say that this communication cannot, in principle, be in writing or by way of a report to the dismissing officer, according to the EAT. In any event, the Employment Tribunal had looked at the procedure adopted by the respondent as a whole: it found that any procedural unfairness in the initial decision to dismiss was sufficiently addressed by the internal appeal, which involved a meeting between the claimant and the decision-maker. The claimant’s appeal against the Employment Tribunal’s finding that her dismissal for misconduct had been fair was therefore dismissed.
Tribunals: Apparent bias in case of lay member posting on social media
In Aspect Windows (Western) Limited V Retter (as representative of the estate of Mrs C McCrorie) [2023] EAT 95 following the publishing of the decision of the employment tribunal arising from a full merits hearing, one of the lay members of the tribunal posted on her LinkedIn page, a link to a report about the decision in the Mail Online. Followers of hers then responded on LinkedIn and she responded to them.
The unsuccessful Respondent in the employment tribunal appealed on the basis that the LinkedIn posts gave rise to apparent bias against it. The EAT held that whilst it is possible that what a tribunal member said about a case after the event could shed light as to their approach to the hearing of it, the fair-minded and informed observer, having considered the contents of these posts and applying the guidance in Magill v Porter [2001] UKHL 67 and other pertinent authorities, would not in the circumstances consider the lay member was biased in favour of the Claimant. The appeal was therefore dismissed.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – March 2023
Employment,
27th March 2023
Employment Law
A round-up of the most significant employment law cases to be published over the last month regarding unfair dismissal and determining the date the contract was terminated, considering how an employee’s disabilities may have affected his conduct, respecting privacy through restricted reporting at tribunals and a look at how the ICO and Easylife settled a monetary penalty for unlawful data processing.
Unfair Dismissal: Determining the effective date of termination of the contract
Disability Discrimination: Determining whether an employee’s disabilities had had an effect on his conduct
Data Protection: ICO and Easylife reach agreement regarding monetary penalty
Unfair Dismissal: Determining the effective date of termination of the contract
In Meaker v Cyxtera Technology UK Ltd [2023] EAT 17 the Employment Appeal Tribunal (the EAT) dismissed the employee’s appeal, concerning the correct approach, in law, to the calculation of the effective date of termination of employment (EDT), pursuant to s.97 of the Employment Rights Act 1996 and for the purposes of a complaint of unfair dismissal. The employee appealed after his unfair dismissal claim was struck out as being out of time. The employer argued that the determination of the EDT was not governed by contractual principles and that, where an employee was dismissed in breach of contract, the EDT was the date on which the dismissal was communicated, regardless of whether he accepted it.
The EAT ruled that the employment tribunal (the ET) had not erred in holding that a letter, which the employer had sent to the employee in February 2020, was a termination letter; and that the effective date of termination, for the purposes of the unfair dismissal claim, was the date of receipt of that letter, even if it had been a repudiatory breach that had not been accepted by the claimant at common law. The EAT held that it was not bound to conclude that the meaning of the letter was rendered ambiguous by the fact that the opening paragraph of the relevant settlement agreement had referred to termination being effected by mutual agreement; and that the ET had been entitled to take the view that, even where there had been no mutual agreement, the termination (by the letter) had been clear.
The EAT ruled that there was no sign in the authorities that it was considered that the EDT would only be the date of a repudiatory breach if the contract had, in fact, been brought to an end by the employee accepting that breach. Further, the EAT held that the ET had not erred in holding that the employee had not shown that it had not been reasonably practicable for him to have presented his unfair dismissal complaint in time.
Disability Discrimination: Determining whether an employee’s disabilities had had an effect on his conduct
In McQueen v General Optical Council [2023] EAT 36, the Employment Appeal Tribunal (the EAT) dismissed the employee’s appeal against the employment tribunal’s (the ET’s) decision, dismissing his claim which alleged unfavourable treatment by the respondent employer because of something arising in consequence of a disability, pursuant to s.15 of the Equality Act 2010 (EqA 2010). The employee had dyslexia, some symptoms of Asperger’s Syndrome, neurodiversity and left sided hearing loss, which had caused some difficulties with his interactions in the workplace. The employer, which was the statutory regulator of optometrists and opticians practising in the UK, had employed the employee as a registration officer. The employee had had ‘meltdowns’ at work, which had led to disciplinary proceedings. Subsequently, he had left that employment.
The employee contended that: (i) the ET had misapplied the broad test of causation required where a claim under s.15 was being considered, in that its reasoning had been contrary to the psychiatric and psychological evidence; (ii) the disability did not, necessarily, need to be the sole or even main reason for the ‘something’ that arose in consequence of it; (iii) the employer had, itself, linked the employee’s behaviour to his disabilities; and (iv) in considering whether there had been discrimination of the kind where ‘A treats B unfavourably because of something arising in consequence of B’s disability’ (EqA 2010 s 15(1)(a)), the ET had failed to appreciate that the words ‘in consequence of’ were, at least, as broad as the ‘because of’ test.
The EAT held that, although it had reservations about the structure and quality of the ET’s decision and reasoning, the ET had not erred in law or principle in the application of s.15 to the facts; and that it had not adopted too strict a test of causation when considering the effects of the employee’s disabilities. The correct reading of the decision was that the ET had found that those effects had not played any part in the conduct that had led to the unfavourable treatment complained of. The EAT held that, once the ET had determined that the employee’s disabilities had not had any effect on his conduct on the occasions in question, the further question whether any unfavourable treatment had been ‘because of’ that conduct had not arisen.
Restricted Reporting: Anonymity in hearing cases in the tribunals
In A v Choice Support (Formerly MCCH Ltd) [2023] EAT 18, the Employment Appeal Tribunal (the EAT) ruled on the respondent’s application, pursuant to r.19 of the Employment Appeal Tribunal Rules 1993, SI 1993/2854, to make permanent a temporary restricted reporting order which had been made at the EAT level, pursuant to r.23 of the 1993 Rules, and arising out of s.11 of the Employment Tribunal’s Act 1996 (the Act), and in line with an order made by the employment tribunal (the ET) pursuant to r.50 of the Employment Tribunals (Constitution and Rules of Procedure) Regulations, SI 2013/1237 (r.50) and s.11 of the Act. The application arose in circumstances where the respondent provided support to vulnerable adults, and the employee alleged that an individual (EA), with whom she had worked at the same property, had raped her.
The EAT held that: (i) r.50 set out a much broader discretion beyond s.11 of the Act; (ii) the orders should make specific reference to which elements of s.11 and/or r.50 the relevant decision was applying; (iii) the distinction between anonymity orders and restrictions on reporting should clearly be separate parts of any such order, setting out whether they were made pursuant to the section or on broader grounds; (iv) if there was concern about jigsaw identification, any order should be made in terms which clearly prohibited publication of any particular detail of the case facts which it was thought might lead to identification; and (v) a restricted reporting order should only be made (and made permanent) when a less restrictive order would not suffice.
The EAT held that the employee should remain anonymised, that EA’s rights under art 8 of the European Convention on Human Rights had been engaged and that, as ‘a person affected’, he should be anonymised and that, because of the risk of jigsaw identification, EA’s parents should remain anonymised. Further, the EAT ruled that the anonymisation should be made the subject of a permanent order.
Data Protection: ICO and Easylife reach agreement regarding monetary penalty
The Information Commissioner’s Office (ICO) has reached an agreement with Easylife Ltd (Easylife) to reduce the monetary penalty notice to £250,000 for breaching the UK General Data Protection Regulation, Retained Regulation (EU) 2016/679 (UK GDPR). Easylife has accepted the ICO’s findings as set out in the monetary penalty notice and has agreed to pay the reduced fine. This follows the ICO’s fine to Easylife on 4 October 2022, where an investigation found that Easylife was making assumptions about customers’ medical conditions, based on their purchase history, to sell further health related products. This was deemed to involve processing of a special category data without a lawful basis, where Easylife has since stopped the unlawful processing of special category data.
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – January 2023
Employment,
24th January 2023
Employment Law
We start off the new year with a Court of Appeal decision on whether a worker who declined to go back to work for fear of COVID-19 was unfairly dismissed or not, the first of its kind at this level. We also take a look at two discrimination cases, a Court of Justice of the European Union case about requirements on employers to provide ‘special corrective appliances’ (such as glasses), and a claim for misuse of private information concerning the reasonable expectation of privacy in private WhatsApp messages.
COVID-19: First Court of Appeal decision on the application of ERA 1996, s.100(1)(d) to COVID-19 dismissals
Discrimination: Whether PCP requiring disabled employee to work full-time had been applied, despite employer having part-time roles
Discrimination: Narrow test for marital status discrimination confirmed
Health & Safety at Work: Display screen equipment and the provision of spectacles by employers
Data Protection: Misuse of private information and abuse of process
COVID-19: First Court of Appeal decision on the application of ERA 1996, s.100(1)(d) to COVID-19 dismissals
In Rodgers v Leeds Laser Cutting [2022] EWCA Civ 1659, the claimant worked for the respondent as a laser operative in a large warehouse-type space about the size of half a football pitch in which usually only five people would be working. Following the first national ‘lockdown’ on 23 March 2020, the respondent told employees that the business would remain open, asked staff to work as normally as possible and stated ‘we are putting measures in place to allow us to work as normal’. Recommendations were made by an external risk assessment covering most of the things which were already in place before it was undertaken. The claimant left work as usual on 27 March 2020, having not made any complaint about his conditions at work. He obtained a self-isolation note until 3 April 2020 due to having a cough. On 29 March 2020, the claimant told his line manager he had to self-isolate because one child was high risk with sicklecell and a 7 month old baby. His manager agreed. Unfortunately, during this period he drove a friend who had broken his leg to hospital and at some point worked in a pub during the lockdown. On 24 April 2020 he found out he’d been dismissed and was sent his P45.
The claimant made a claim for unfair dismissal on the grounds of health and safety. Under the Employment Rights Act 1996 (ERA 1996), s.100(1)(d), any dismissal of an employee will be automatically unfair, if the reason (or, if more than one, the principal reason) for the dismissal is that, in circumstances of danger which the worker/employee reasonably believed to be serious and imminent and which they could not reasonably have been expected to avert, the employee:
left or proposed to leave, or
(while the danger persisted) refused to return to
their place of work or any dangerous part of their place of work. ‘Dangers’ in this context are not limited to dangers arising out of the workplace itself, but also cover dangers caused by the behaviour of fellow employees.
The questions that the employment tribunal has to decide in a case under ERA 1996, s.100(1)(d) are:
Did the employee believe that there were circumstances of serious and imminent danger at the workplace? If so:
Was that belief reasonable? If so:
Could they reasonably have averted that danger? If not:
Did they leave, or propose to leave or refuse to return to, the workplace, or the relevant part, because of the (perceived) serious and imminent danger? If so:
Was that the reason (or principal reason) for the dismissal?
The tribunal rejected the claim for a number of reasons, including that his evidence was inconsistent, his beliefs of serious imminent danger were not supported by his actions (driving his friend to hospital and working in a pub) and not related to his workplace but to the world at large, he had made no complaint about his specific working conditions, and the measures put in place by the employer (if followed) would make the business as safe as possible from infection.
The claimant appealed, arguing that the tribunal had erred in law by concluding that because his belief was one of a serious and imminent danger at large (i.e. in the whole community), his belief that his workplace presented a serious and imminent danger was not objectively reasonable. The Court of Appeal, like the EAT before it, dismissed the appeal because the claimant’s case failed on its own facts. While the coronavirus pandemic could, in principle, give rise to circumstances of danger that an employee could reasonably believe to be serious and imminent, this was not the situation in this particular claimant’s case in respect of his workplace.
The Court of Appeal has confirmed that, on the particular facts of this case, where the employee refused to return to work during the coronavirus (COVID-19) pandemic in circumstances where the employer had put in place social distancing in the workplace and other measures like handwashing and face masks, the employment tribunal did not err in law in concluding that the claimant had not reasonably believed that there were circumstances of danger which were serious and imminent, or which could not be reasonably averted, and as result the dismissal was not automatically unfair under section 100(1)(d) of the Employment Rights Act 1996 (ERA 1996).
Guidance was given on the interpretation of ERA 1996, s 100(1)(d) including that:
it is sufficient that the employee had a (reasonable) belief in the existence of the danger as well as in its seriousness and imminence. They do not also have to prove that objectively such circumstances of danger did in fact exist;
the subsection does not apply where the perceived danger arose on the employee’s journey to work. The perceived danger must arise at the workplace. However it does not follow that the danger need be present only at the workplace;
while the paradigm case under ERA 1996, s 100 (1)(d) is where a danger arises by reason of some problem with the premises or equipment, there is nothing about the risk of employees infecting each other with a disease that takes it outside the scope of the subsection: the tribunal will have to decide whether on the particular facts of each case it amounts to a serious and imminent danger.
While the outcome of this case ultimately turned on its own particular facts, the judgment is nonetheless of interest because it is the first appeal to reach the Court of Appeal on the application of ERA 1996, s 100(1) to dismissals related to the coronavirus (COVID-19) pandemic.
Discrimination: Whether PCP requiring disabled employee to work full-time had been applied, despite employer having part-time roles
In Davies v EE Ltd [2022] EAT 191, the EAT considered what amounted to a provision, criterion or practice (PCP) for the purposes of a disability discrimination claim relating to an alleged failure to make reasonable adjustments.
The employee, who was employed full-time, relied on two PCPs, which she contended had left her at a substantial disadvantage: (i) a requirement for employees to complete a full-time working pattern of 40 hours per week, with each shift approximately 9½ hours in length, and (ii) a requirement for employees to complete the shifts without agreeing any reduction in hours. The employment tribunal held that because the respondent employed some employees on a part-time basis and had allowed the claimant a phased return to work, neither PCP had been made out on the facts.
The EAT held that the tribunal had erred in law in concluding that the fact that the employer had other staff who worked part-time had meant that a PCP of requiring the employee to work her contracted hours of 40 per week had not been applied to her. Also, the fact that a temporary adjustment had been made during the employee’s phased return to work did not mean that the PCP had ceased to exist.
Discrimination: Narrow test for marital status discrimination confirmed
In Ellis v Bacon [2022] EAT 188, the EAT considered a matter of two married director/shareholders whose messy divorce impacted the divorcing wife’s income from the company. Another director, Mr Ellis, sided with the husband, Mr Bacon, in relation to the marital dispute and was compliant with him in removing the Mrs Bacon’s directorship, not paying her dividends, reporting her to the police and suspending and dismissing her on spurious grounds. The employment tribunal held that these actions involved less favourable treatment by Mr Ellis against Mrs Bacon because of her marital status as a wife to Mr Bacon. Mr Ellis appealed.
The EAT held that in a claim of direct discrimination because of the protected characteristic of marriage, the employment tribunal must consider whether it was the claimant’s marital status which was the cause of the less favourable treatment and not the fact that they were married to a particular person. Further, an appropriate hypothetical comparator is someone in a close relationship but not married, and the tribunal must consider whether such a person would have been treated differently.
A person directly discriminates against another person where they treat them less favourably than they treat or would treat others, and they do so because of a protected characteristic. Marriage and civil partnership are protected characteristics. A person has the protected characteristic of marriage if the person is married (which includes a person who is married to a person of the same sex); of civil partnership if the person is a civil partner. Note that people who are not married, or not civil partners, do not have this protected characteristic.
Cases on discrimination because of marriage are very rare. This judgment confirms that the test is to be narrowly construed, with the causative reason for the less favourable treatment being the marital status and not:
the identity of the spouse, or
the closeness of the relationship.
As a result, there seems very limited scope for claimants to bring successful claims in the context of modern society and the legal concept of protection on grounds of marital status looks increasingly like an outdated concept.
Health & Safety at Work: Display screen equipment and the provision of spectacles by employers
In TJ v Inspectoratul General pentru Imigrări, C-392/21, the Court of Justice of the European Union held that Article 9 of Council Directive 90/270/EEC, on the minimum safety and health requirements for work with display screen equipment, which is implemented in the UK by regulation 5 of the Health and Safety (Display Screen Equipment) Regulations 1992, must be interpreted as follows:
there is no requirement for a causal link between display screen work and potential visual difficulties;
‘special corrective appliances’ include spectacles aimed specifically at the correction and prevention of visual difficulties relating to work involving display screen equipment;
those ‘special corrective appliances’ are not limited to appliances used exclusively for professional purposes, i.e. they may be used at other times too; and
the employer’s obligation to provide the workers concerned with a special corrective appliance may be met by the direct provision of the appliance to the worker by the employer or by reimbursement of the necessary expenses incurred by the worker, but not by the payment of a general salary supplement to the worker.
Data Protection: Misuse of private information and abuse of process
In FKJ v RVT [2023] EWHC 3 (KB), which concerned a claim for misuse of private information, the court considered the extent to which there can be a reasonable expectation of privacy in private WhatsApp messages found at work, and how such material should be dealt with in the context of ongoing legal proceedings. FKJ brought a claim in the employment tribunal against her former employers on the grounds of sex discrimination, unfair dismissal and wrongful dismissal, amid allegations of sexual harassment by the first defendant, RVT. FKJ lost that employment tribunal claim, in large part due to evidence deployed by RVT which consisted of some 18,000 of FKJ’s private WhatsApp messages. Prior to that tribunal hearing, the defendants had come to be in possession of a complete log of messages exchanged between FKJ and both her partner and her best friend, some of which were ‘of the most intimate kind’. FKJ brought a claim for misuse of private information.
While there was some dispute over how RVT came to be in possession of these messages, spanning a period of two years, FKJ only became aware of them being in his possession when she received the defendants’ grounds of resistance in the employment tribunal proceedings. FKJ chose not to seek exclusion of those messages from evidence, or to seek aggravated damages as a result of RVT’s conduct. Instead, FKJ chose to pursue a claim for misuse of private information in the High Court.
RKJ brought a counter claim grounded in the common law torts of malicious prosecution and abuse of process, and harassment under the Protection from Harassment Act 1997. RVT also sought to strike out the claim and seek summary judgment on his counterclaim. As a fall back, the defendants sought payment of significant sums into court by FKJ as a condition of the proceedings continuing.
The court gave short shrift to the defendants’ applications, reaching the ‘clear conclusion that they are without merit’. Parts of the applications were ‘not worthy of serious consideration’ and appeared to be ‘an attempt to stifle a claim that the defendants would prefer not to contest on its merits’. Both the strike out and summary judgment applications were dismissed.
[Written by Charlotte Clayson, partner at Trowers & Hamlins LLP, for Lexis+.]
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.
In our last update of the year we bring you technical tribunal processes...
News & Views
Employment Law Case Update – June 2022
Employment,
28th June 2022
Employment Law
A round-up of the most significant employment law cases to be published over the last month including insights on dismissal cases, using without prejudice letters and when injunctive relief may be sought to enforce a non-compete clause. We also have an interesting case on ethical veganism v legality of actions.
Equality Act: Ethical veganism encompassing an obligation to break the law to relieve animal suffering was not a protected belief
Unfair Dismissal: Statutory cap should be applied to unfair dismissal compensation after deduction of earlier payments made to employee
Constructive Dismissal: Fundamental breach possible even where employer’s actions do not suggest intention to end employment relationship
Dismissal: ACAS code applied to discriminatory sham redundancy dismissal
Without Prejudice: Without prejudice letter inadmissible despite exaggerated allegations
Equality Act: Ethical veganism encompassing an obligation to break the law to relieve animal suffering was not a protected belief
In Free Miles v The Royal Veterinary College ET/2206733/2020, an employment tribunal has found that a belief in ethical veganism encompassing an obligation to break the law to relieve animal suffering did not amount to a philosophical belief under section 10 of the Equality Act 2010 (EqA 2010).
Ms Free Miles was a veterinary nurse employed by the Royal Veterinary College (RVC). In February 2019, she was arrested by police in connection with alleged burglaries by the Animal Liberation Front. The police found a sick turkey at her flat which she said she had rescued. Following her arrest, Ms Free Miles was summarily dismissed by RVC for reasons including that RVC believed she was connected with an animal rights group that endorsed law breaking and that she had participated in activities including trespass and theft.
Ms Free Miles brought an employment tribunal claim against RVC for, among other things, direct and indirect philosophical belief discrimination. She relied on her belief in ethical veganism, arguing that this belief included a moral obligation to take positive action to reduce animal suffering, including trespass on property and removal of animals. By the time of the tribunal hearing, Ms Free Miles had been charged by the police with criminal offences relating to animal rights activities.
The tribunal stated that, had Ms Free Miles’ belief in ethical veganism been limited to the belief that humans should not eat, wear, use for sport, experiment on or profit from animals, it would have had no reservation in concluding that it amounted to a philosophical belief under section 10 of the EqA 2010. It also said that it might have reached the same conclusion had the moral obligation to take positive action to reduce or prevent animal suffering been limited to lawful action.
However, Ms Free Miles’ belief included trespassing on private property and acting in contravention of the law. The tribunal concluded that a belief to take actions that are unlawful and to interfere with the property rights of others could not be worthy of respect in a democratic society, so did not satisfy the fifth element of the test in Grainger Plc v Nicholson [2010] 2 All ER 253. Laws were made by democratically elected representatives and had to be obeyed by all citizens. It was not open to individuals to decide which laws to obey and disobey. Ms Free Miles’ discrimination claims therefore failed.
Unfair Dismissal:Statutory cap should be applied to unfair dismissal compensation after deduction of earlier payments made to employee
In Dafiaghor-Olomu v Community Integrated Care [2022] EAT 84, the EAT has held that any payments made by an employer to an employee in respect of an unfair dismissal claim must be deducted from the total compensation sum before the statutory cap is applied.
Mrs Dafiaghor-Olomu won an unfair dismissal claim against Community Integrated Care (CIC). She sought re-engagement and compensation. The tribunal refused re-engagement but awarded £46,153.55 in compensation which CIC paid in full. At a second remedies hearing following a successful appeal, the tribunal increased the compensatory award to £128,961.59. The EAT was required to determine whether the statutory cap should be applied after the earlier payment made by CIC was deducted from the sum of £128,961.59 (leaving an outstanding payment of £74,200, being the amount of the statutory cap in place at the relevant time) or whether the statutory cap should be applied to the total award before the earlier payment was deducted (leaving an outstanding payment of £28,046.45). CIC argued for the latter approach, stating that the former would mean it got no credit for the earlier payment and would be penalised for complying with the tribunal’s original order.
The EAT considered the wording of section 124(5) of the Employment Rights Act 1996. It felt that this showed that Parliament’s intention was for the tribunal to calculate the total compensation due to the employee and then subtract from it any earlier payments made by the employer before applying the cap. However, in reaching this conclusion, the EAT expressed considerable sympathy with CIC. In paying the original compensatory award, CIC had complied with what it perceived to be its duty. Had it foreseen the possibility that the tribunal would increase the award at the second remedies hearing, it would probably have declined to make any payment until the compensatory order was final. Instead, it ended up owing £74,200 plus £46,153.55 instead of just £74,200.
Additionally, the EAT upheld the employment tribunal’s decision not to reconsider its refusal to award re-engagement after the second remedies hearing on the basis that such an order was impracticable because of Mrs Dafiaghor-Olomu’s attitude towards which jobs were suitable for her. It also dismissed a cross appeal in which CIC argued that the employment tribunal had not been entitled to increase the compensatory award at the second remedies hearing.
Constructive Dismissal: Fundamental breach possible even where employer’s actions do not suggest intention to end employment relationship
In Singh v Metroline West Ltd [2022] EAT 80 the EAT has held that, in a constructive dismissal claim, a fundamental breach of contract can be established even where the employer’s actions do not indicate an intention to end the employment relationship.
Mr Singh was invited to a disciplinary hearing by Metroline West Ltd. The next day, Mr Singh was signed off sick by his doctor. While absent, he was examined by occupational health who did not suggest his sickness was not genuine. However, Metroline believed that Mr Singh was trying to avoid the disciplinary hearing. It therefore paid him statutory sick pay only, instead of company sick pay. Mr Singh brought a claim for constructive dismissal, alleging, among other things, that the failure to pay him company sick pay was a fundamental breach of contract.
The employment tribunal found that Metroline had contractual power to suspend Mr Singh without pay if it thought his absence was not genuine, but this power had not been exercised. Separately, Mr Singh’s contract allowed company sick pay to be withheld where, after investigation, absence was found not to be genuine. There was no investigation in this case and no other relevant contractual grounds on which company sick pay could be withheld. There was therefore a breach of contract. However, the tribunal found the breach was not fundamental. By withholding pay, Metroline had not indicated an intention not to be bound by the employment relationship; rather, its aim in withholding pay was to encourage Mr Singh’s participation in a disciplinary process integral to that relationship.
However, the EAT upheld Mr Singh’s appeal on this issue. It was an error of law for the tribunal to adopt the approach that, for the breach of contract to be fundamental, there must have been an intention by the employer not to be bound by the contract in a manner that meant that it no longer wished to continue with the employment relationship. What is required is that the employer demonstrates an intention to no longer comply with the terms of the contract that is so serious that it goes to the root of the contract. In this case, there was a deliberate decision to withhold pay to which Mr Singh was entitled, resulting in a significant reduction in earnings, in circumstances where there were other contractual provisions which would have allowed Metroline to deal with suspicions about his absence. This was a fundamental breach.
Dismissal: ACAS code applied to discriminatory sham redundancy dismissal
In Rentplus UK Ltd v Coulson [2022] EAT 81 the EAT has held that the ACAS Code of Practice on Disciplinary and Grievance Procedures (ACAS Code) applied to a discriminatory dismissal purportedly by reason of redundancy. The tribunal had not erred in awarding the maximum 25% uplift available for failure to follow the ACAS Code.
The employer’s ground of appeal that the ACAS Code could not apply where their reason for dismissal was redundancy and the reason found by the tribunal was sex discrimination failed. This was because the tribunal had rejected redundancy as the reason for the dismissal and the upholding of the sex discrimination claim did not mean that it was the only reason for the dismissal. The EAT considered it was implicit in the tribunal’s reasoning that the claimant was in a “disciplinary situation” to which the ACAS Code applied, this being that she was dismissed due to dissatisfaction with her personally and/or her performance, which was tainted by sex discrimination, and a fair capability or disciplinary procedure should therefore have applied.
It was clear that the tribunal had concluded the dismissal process was a sham and there had been a total failure to comply with the ACAS Code. The breach was referred to as “egregious” and so was beyond unreasonable. While, generally, a tribunal should identify the employer’s failings for which an uplift is being made by reference to the relevant part of the ACAS Code which the employer is said to be in breach of, in this case the tribunal had concluded that the employer had acted in bad faith such that there was a total failure to apply any of the protections provided for by the ACAS Code. In these circumstances, there was no error of law in the award of an uplift of 25%.
The EAT provided guidance in the form of questions that tribunals considering an ACAS uplift should apply:
Is the claim one which raises a matter to which the ACAS Code applies?
Has there been a failure to comply with the ACAS Code in relation to that matter?
Was the failure to comply with the ACAS Code unreasonable?
Is it just and equitable to award an uplift because of the failure to comply with the ACAS Code and, if so, by what percentage, up to 25%?
Injunctive Relief: Interim enforcement of non-compete clauses
In Planon Ltd v Gilligan [2022] EWCA Civ 642 the Court of Appeal has dismissed an appeal from the High Court’s refusal to grant an interim injunction to enforce a non-compete clause.
The High Court had held that the delay between the initial exchanges of correspondence between the parties and the application being heard was not the sort of delay that would disqualify the employer from interim injunctive relief. However, the employer’s prospects of success at trial in enforcing the non-compete clause were not that good, the critical point being the non-compete clause was likely to prevent the employee from being able to work in his field for 12 months. Damages would not, or might not, be an adequate remedy for either the employer or employee in this case.
While the Court of Appeal dismissed the employer’s appeal, its reasoning differed from that of the High Court. It held that the High Court had not taken the correct approach when considering whether the non-compete clause was reasonable. However, in view of the delay by the time the matter came before it, the court did not consider it appropriate to express a preliminary view about the enforceability of the clause.
The court considered the effect of delay in the case. There was a divergence of opinion between Elisabeth Laing LJ and Bean LJ, with Nugee LJ expressing no view, on the effect of the delay between the facts becoming known to the employer and the High Court hearing. Elisabeth Laing LJ considered that the judge had reached a decision open to him on the facts while Bean LJ considered that the judge would have been entitled to refuse an injunction on the ground of delay. The court noted that there was no rule of law to the effect that damages would be an adequate remedy for the employee (if it was found that at trial that a restrictive covenant is unenforceable). Bean LJ suggested that, except in cases of very wealthy defendants, or where a claimant employer is offering paid garden leave for the whole period of the restraint, it was unrealistic to argue that damages would be an adequate remedy.
Without Prejudice: Without prejudice letter inadmissible despite exaggerated allegations
In Swiss Re Corporate Solutions Ltd v Sommer [2022] EAT 78 the EAT has held that an employment judge erred when holding that a without prejudice letter could be admitted into evidence under the “unambiguous impropriety” exception to the without prejudice rule in proceedings brought by an employee against her former employer. The without prejudice rule prevents statements made (whether in writing or orally) in a genuine attempt to settle an existing dispute from being put before the court as evidence of admissions against the interest of the party that made them.
The letter referred to the employee’s actions in having copied three emails to her personal email address when sending them to her employer in pursuit of a grievance. The emails had contained personal data and matters confidential to the employer and its clients. Before offering to settle her complaints by way of termination of her employment and payment of compensation, the letter alleged that the employee’s actions breached the confidentiality obligations in her employment contract, were a criminal offence under the Data Protection Act 2018 and meant that she had acted, or might have acted, without integrity in breach of Financial Conduct Authority (FCA) rules. This could result in summary dismissal, criminal convictions, fines and FCA findings which could make it difficult for her to work again in the regulated sector.
In holding that the unambiguous impropriety exception applied, the employment judge found that there had been no basis at all for the employer’s assertion that the employee’s actions amounted to serious misconduct and that the severity of what she had done had been grossly exaggerated in order to put pressure on her to accept the termination of her employment.
The EAT held that the employment judge had erred in finding there was no basis at all for the allegations of serious misconduct. It considered that the high threshold for unambiguous impropriety could be met in circumstances in which a party made exaggerated allegations although it was unaware of any decided case on this point. However, exaggeration would not usually pass the threshold without findings as to the guilty party’s state of mind. The employment judge did not make such findings, and the EAT doubted that this could have validly been done at a preliminary hearing without oral evidence. The only possible outcome in this case was that the without prejudice letter was inadmissible in evidence.
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.