Search News and Articles
Legal Developments in the The Legal 500 United Kingdom 2012
TRANSFER OF UNDERTAKINGS (PROTECTION OF EMPLOYMENT) AND AGE DISCRIMINATION
I have been asked to cover the topic of Employment law within my half an hour speaking slot today. I have narrowed my subject down to Transfer of Undertakings and Discrimination, with the focus on providing an update on the recent spate of cases on service provision change and on the important developments in the law of age discrimination. Needless to say, in my presentation I shall not be able to cover the level of detail which is contained in my written paper, which I will leave you to read.
Global litigation risks
Will employment litgation become another UK import?
Written for The Lawyer, read article by Christopher Jeans QC and Daniel Oudkerk QC
Age Discrimination
The title of my talk takes the form of a question: “How radical a change are the age discrimination provisions?”
The short answer is, “Very”, or, in the light of the two recent Judgments of the Supreme Court to this area of the law, “Very, very”.
Whistleblowing
In Parkins v Sodexho Ltd [2002] IRLR 109 the EAT held that an employee can make a protected disclosure about a breach of his own contract of employment. This opened up the possibility that almost any grievance raised by an employee might amount to a protected disclosure.
TUPE ROUND-UP
After a period of relative quiet, there has been a spate of TUPE cases over the last year. This paper looks at those cases, concentrating particularly on the following topics:
Working Time: Holidays
Working time is a notoriously complex area, where the interplay between opaque judgments from the CJEU and the complexities of the Working Time Regulations 1998 is capable of causing uncertainty and confusion.
High Court Remedies following Edwards v Chesterfield
The decision of the Supreme Court in Edwards v Chesterfield Royal Hospital NHS Foundation Trust & Botham v Minister of Defence [2011] UKSC 58 [2012] ICR 201 (“Edwards”) represents the latest word from our highest domestic court as to the availability of damages for losses arising following the termination of employment.
Confidential Information – What’s the Latest?
Issues of confidence and confidential information are rarely out of the news. Whether the context is the privacy of celebrities, the disclosure of commercial confidences (in exciting arenas such as formula one racing) or attempts by employees to make use of their former employer’s trade secrets, issues of confidence interest the general public. Similarly, issues of confidence are rarely out of the courts.
Employees deciding together to establish a competing business: what are the legal principles
In many cases where a person wishes to leave an employment and establish a new business, that person may wish to tell colleagues about the plans and to encourage them to join him or her in the new venture. It may be that there is disaffection in the workplace and that there is a general, if unexpressed, desire to move on.
Team Move Update
What developments have there been now that the dust has settled on the Tullett litigation?
Changing terms and conditions and redundancies in an economic downturn
The latest figures from the Office for National Statistics paint a gloomy picture of the UK economy: two successive periods of negative economic growth; in economic terms, a recession1.
Restraint of Trade/Recent Authorities
As usual, the current crop of recent decisions in this area contain a real mix of the orthodox and the heterodox approach to the doctrine of restraint of trade, frequently within the same case.
STRATEGY AND TACTICS IN DEFENDING CITY WHISTLEBLOWING CLAIMS
This talk addresses the essential elements of a whistleblowing claim in the context of the recent cases and considers strategies and tactics for employers and employees in high value claims:
Springboard Injunctions
Whilst springboard injunctions are a well-established remedy, the precise circumstances in which they can be obtained, and their scope and duration, can often be unclear. Two recent decisions offer some helpful guidance. These are QBE Management Services Ltd v Dymoke [2012] EWHC 80 (QB) and Clear Edge UK Ltd v Elliot [2011] EWHC 3376 (QB).
TUPE AND COLLECTIVE AGREEMENTS
Terms and conditions of employment are often found, especially in the public sector, not in the individual contracts of employment themselves, but in collective agreements between the employer and trade unions, collective agreements which are expressly incorporated into the individual contracts. If the employer and the unions agree changes in the collective agreement then the individual contracts will automatically be varied accordingly.
Employment Law Update
Peter Wallington QC
In my talk, and this paper, I will attempt to highlight some of the most important developments in Employment Law in the last year, with particular reference to those most likely to be of interest to those working in the local government sector, and will also highlight the key proposals for reforms, both procedural and substantive, issued for consultation by the Government earlier this year.
SEN, disabilities and independent schools
(A) Disability discrimination - incl reasonable adjustments, admissions andexclusions
(B) Statements of SEN - parental preference, costs (H v Kent CC, the Slough case)
(C) Other matters - Academies, the Education Bill, the SEN Green paper
Procedural Control Mechanisms – Strike Out, Deposits, Stays and Costs
Simon Forshaw
Introduction 1. The Employment Tribunal system is under attack! It is regularly exposed to criticism as being inefficient, costing those who participate in it too much money and amounting to a disproportionate burden on business. Such criticism has been made all the more fiercely of late both because of the economic climate and also because the Government has been reviewing the Employment Tribunal system with the express aim of reducing the burden placed on business by it.
Monetary remedies in the Tribunal (including interim relief); Maximising the value or...
minimising the pain
Simon Devonshire QC
1. A recession tends to lead to more claims but fewer trials. Employees naturally look for ways to maximise the value of their claims – particularly by reference to causes of action that bust the cap for a ‘vanilla’ unfair dismissal - often (in the case of high value employees) by reference to the whistleblowing legislation.
RESCUE ME….INSOLVENCY ISSUES FOR EMPOYMENT LAWYERS
Jane McCafferty
policy aim behind the legislation governing insolvency is that of facilitating the so-called ‘rescue culture’ by making insolvent employers more attractive to prospective purchasers. The policy aim behind employment protection legislation is to provide valuable rights for employees. It is unsurprising that, when these two policy aims collide, problems arise.
Employment Law Update
In my talk, and this paper, I will attempt to highlight some of the most important developments in Employment Law in the last year, with particular reference to those most likely to be of interest to those working in the local government sector, and will also highlight the key proposals for reforms, both procedural and substantive, issued for consultation by the Government earlier this year.
Equal Pay
by Andrew Blake
Equal pay continues to be a very hot topic in local government circles and, also, in employment law generally. As a result, in the last 12 months there have been a number of important appellate decisions, many involving local authorities. In addition many of the provisions in the Equality Act 2010 (‘the EA 2010’) came into force in October 2010 (although in most, but not all, respects the EA 2010 simply restates the provisions of the Equal Pay Act – ‘the EPA 1970’).
Hersey! Is Contract law difference when applied to Employment? Part 1: Terms
Employment contracts are distinctive. The most obvious reason for this is statuary intervention.
Garden Leave: Possibilities and Pitfalls
"Garden Leave" is the practise of modifying an employee's role to protect an employer's legitimate interests, most often where an employee has given notice to leave work for a competition.
Settling Employment Claims: some recent developments
Peter Wallington Q.C.1
The statutory context 1. The settlement of ordinary commercial disputes is familiar territory for all lawyers, and settlements rarely require any particular formalities beyond sufficient clarity as to the terms of the agreement. This is equally so for purely contractual disputes in the field of employment, but there the comparison stops.
Ezsias v North Glamorgan NHS Trust: Dismissals for breakdown in trust and confidence
Julian Milford
In this paper, I discuss the recent decision of the EAT (Keith J) in Ezsias v North Glamorgan NHS Trust UKEAT/0400/09 (18 March 2011)
News of the World: a closure without closure? Will the stigma last?
The closure of the News of the World leaves its employees facing an uncertain future. It does not take News International’s own Mystic Meg to predict that that future will inevitably involve litigation. But what is the legal landscape and what claims can we expect?
Age Discrimination
Written by Christopher Jeans QC
Some specific features: all are victims, all are beneficiaries
1. The Equality Act 2010 has brought most1 of the law discrimination under a single
roof...
Equal Pay
Written by Nigel Porter
a. Material Factor and justification.
b. TUPE and Equal Pay.
c. Proper Comparators and same employment/single source.
d. Other recent cases.
e. The Equality Act 2010: The new provisions and the changes introduced by ss 64-83 of the
Equality Act: secrecy clauses, comparators and reporting and information obligations.
f. Codes of Practice and guidance on Equal Pay.
GARDEN LEAVE & POST TERMINATION RESTRAINTS THEIR INTERACTION AND THE LEGAL PROBLEMS GENERATED
Written by Alistair McGregor QC
1. The origins of the garden leave injunction are to be found in the judgment of Lord St
Leonards VC in Lumley v Wagner given on 26th May 1852 (see I de GM&G 604 42 ER
687).
Strikes and Industrial Action - Wriiten by Daniel Stilitz QC
1. The recent upsurge in reported cases on strikes and industrial action may well serve as a barometer of the current economic and political climate. The level of legal activity in this area over the last year or so has perhaps been greater than at any time since the statutory balloting procedures were first introduced in the 1980s. Those procedures have become more complex through subsequent amendment, in particular since 1992, thereby guaranteeing a fertile stream of novel points to be determined by the courts in times of industrial strife.
THE BRIBERY ACT 2010 (OR, WHY WE CAN’T GIVE YOU A ROLEX AND OTHER STORIES)
1. The Bribery Act 2010 (“the Act”) will finally come into force on 1 July 2011. Its aim is to reform the criminal law of bribery and create a new consolidated scheme of bribery offences to cover bribery both in the UK and, significantly, abroad. It provides a modern criminal counterpart to the sanctions long-established in relation to bribery in civil law.
Equal Pay
The bleak outlook for local authorities continues. There have been a number of recent judgments which have made life harder still for local authorities which are trying to defend themselves against multiple equal pay claims, brought by claimants supported by unions, or by no win, no fee solicitors, or by a combination of both.
Equality Act 2010
The Equality Bill was published on 27 April 2009 and became an Act of Parliament just before the last general election on 8 April 2010. The Explanatory Notes state that the Act has two main purposes: to harmonise discrimination law, and to strengthen the law to support progress on equality.
Employment Law Update
This paper considers recent developments in the case law which are likely to affect local authority employers. Legislative changes effected by the Equality Act are considered in Holly Stout’s paper, delivered in the next session.
Strike Action
In the last twelve months there have been a number of important decisions in relation to Part V of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA).
Equal Pay
This talk aims to give a brief overview of issues arising on equal pay claims. At the same time it attempts to point out areas either of particular current interest or controversy, or where equal pay litigators need to be aware of specific substantive or procedural issues.
Age Discrimination
At the most general level the structure of the Employment Equality (Age) Regulations 2006 ("the Regulations") appears to be similar to that adopted in the other anti-discrimination legislation.
Team Moves
This talk considers the implications of the recent decision of the High Court in Tullett Prebon v BGC.1 It considers the legal remedies available to the gamekeeper, the pitfalls faced by the poacher, and the legal and strategic lessons to be drawn from the case.
400,000,000 Facebook fans can’t be wrong
The way we use the internet haschanged. It is no longer merely a digital reference library. As the internet has grown and the amount of information available has expanded, people have developed a new way of accessing this information in a way that is relevant to them. The ‘new’ internet, or ‘Web 2.0’, is a network of relationships where users interact and share knowledge with each other. Virtual friends become the custodians of knowledge, recommending products and services through their blogs and on other social media sites. By seeing what your like-minded friends find interesting, you are better able to decide what information you wish to ‘consume’.
Secrets and lies:the without prejudice principle
In many legal disputes, particularly in the employment sphere, extensive use is made of without prejudice (WP) discussions. Discussions are WP if they are made in the course of a dispute between parties and represent an attempt to settle that dispute. While it is common for parties to make it expressly clear when discussions are WP and to record that fact in any documentation, it is good practice, not a legal requirement.
Whistleblowing in practice: ten years on
Following incidents such as the Clapham rail crash, the Zeebrugge ferry disaster and the scandals at the Bank of Credit and Commerce International (BCCI) and Baring Asset Management, it became clear that staff had been aware of the risks but had been too worried about what might happen to them to raise their concerns.
Public Interest Disclosure Act (PIDA) 1998
PIDA 1998 came into force on 2 July 1999, with the aim of targeting the above issues and of protecting individuals who make certain disclosures of information in the public interest (ie individuals who ‘blow the whistle’). PIDA 1998 inserted new ss43A-43L and s103A into the Employment Rights Act (ERA) 1996. These sections offer ostensible protection (from detriment and/or dismissal) for workers who report malpractices by their employers (or third parties).
Team moves and poaching raids
Tullett Prebon Plc & Ors v BGC Brokers LP & ors [2010], where BGC were held to have unlawfully poached several teams of Tullett brokers, is a recent example of the fine line between team moves that are legally permissible and those that are unlawful. Tullett also illustrates the significant disruption and costs caused by poaching raids on staff.
The volatile business of inter-dealer broking may not be representative of most employers, but with an increased fluidity in the employment market as the economy emerges from recession, more employers are becoming wise to the increased risk, or opportunity, of team moves, particularly in sectors where teams rather than individuals are responsible for securing business.
How, then, should a business go about acquiring a team without incurring liability? Conversely, what should a business do to protect itself against losing its most valuable assets?
Disability discrimination update
There have been several significant developments in case law concerning disability discrimination over recent months, but what impact will these changes have on employers? We examine below some of the key developments and their practical effect.
What’s new this April?
With the passing of each year, new employment-related legislation comes into force and, of course, 2010 is no exception. In April a range of new measures – some of which have long been on the horizon – will become law. An overview of the new measures and their potential impact is set out below.
Tribunals to forward whistleblowers’ allegations directly to regulators
In a move that is likely to cause concern for many employers, Employment Tribunals will soon be given the power to pass on details of whistleblowing claims directly to regulators. The new Employment Tribunals (Constitution and Rules of Procedure) (Amendment) Regulations 2010 (the Regulations) are a response to concerns that some genuine allegations of malpractice were not being notified to, or investigated by, regulators. The government hopes that the new measures will facilitate the investigation of more instances of unlawful behaviour. The measures will be implemented for all whistleblowing claims submitted on or after 6 April 2010.
Religion and belief discrimination
Religion and controversy are never far apart. In the world of employment law the headlines are all too familiar: the Muslim hairdresser who was refused a job because of her headscarf, the British Airways employee who was banned from wearing a cross and the Relate counsellor who was dismissed for refusing to counsel gay couples. These cases have highlighted the difficulties faced by employers in upholding the principle of equal treatment, especially where the interests of one or more protected groups collide. This article looks at several recent cases that have begun to test the limits of religion and belief discrimination. It examines the extent to which non-religious beliefs may be protected and the conflict between personal beliefs and employment obligations.
Secrets and lies: confidential informationSecrets and lies: confidential information
Despite extensive litigation in the area, it is still common practice for employees moving between companies (particularly competing firms) to bring with them confidential information belonging to their former employer. All employees have a duty of confidentiality imposed by common law and these duties are often expanded or clarified in their employment contract or company handbook. Such contractual provisions can be useful if they are properly used to specify areas that are genuinely confidential. However, these contracts can fall into the trap of attempting to define too much information as ‘confidential’ and the courts are likely to view excessively inclusive clauses with scepticism. This article discusses the issues for new and former employers when an employee leaks confidential information.
Another day,another complaint
What happens when you have an employee who is determined to make a nuisance of themselves, regardless of the validity of their claims? This article gives some helpful hints and tips on dealing with common tactics used by employees to put pressure on employers.
Guidance on trigger points for collective redundancy consultation
In another case, akavan Erityisalojen Keskusliitto AEK & ors v Fujitsu Siemens Computers Oy [2009], the European Court of Justice (ECJ) has given guidance on the meaning of ‘contemplating’ redundancies for the purposes of collective consultation.
Workers can reclaim holiday lost to sickness
The European Court of Justice (ECJ) recently decided in the case of Vincente Pereda v Movilidad SA [2009] that a worker who falls ill on holiday can choose to take the holiday lost to sickness at a later date.
Retirement at 65 has had its Heyday
As has been widely reported, the High Court in R (on the Application of Age UK) v Secretary of State for Business, Innovation and Skills [2009] has found that the default retirement age (DRA) of 65 is justified and can remain for the time being, although the judge gave a strong indication that it will have to be raised after next year’s government review.
Money talks: a new era of transparency beckons in pay and remuneration
The issue of pay has dominated the headlines over the summer, largely in relation to the remuneration of City employees. While restrictions on bankers’ bonuses and the obligation to provide greater transparency of pay arrangements to regulators is an immediate concern for large financial organisations, the issue of transparency in pay arrangements will soon become a concern for all large private employers if the proposals in the Equality Bill (the Bill) come into law.
Avoiding the cost of redundancies
WITH BUSINESSES UNDER THE MOST pressure they have been under since the late 1980s, the challenge of controlling costs has become the number one ‘bottom line’ issue for owners, directors and managers alike. The first place to look is often the biggest cost – people. But hastily made decisions about redundancies can have long-lasting and detrimental effects. Smart thinking around what is best for the business is the order of the day. Joanna Blackburn and Helen Croft of Mishcon de Reya’s employment group examine the alternatives to making employees redundant.
Routine settlement correspondence - potentially an act of victimisation?
The Sex Discrimination Act 1975 renders it unlawful to victimise a person through less favourable treatment because they have brought sex discrimination or equal pay proceedings. Similar provisions exist in relation to other areas of discrimination.
Disability discrimination - reasonable adjustments and sick pay
The provisions of the Disability Discrimination Act 1995 (DDA) impose an obligation on employers to make a reasonable adjustment where a provision, criterion or practice is placing a disabled employee at a substantial disadvantage when compared to an employee who is not disabled.In some situations, a disabled employee's condition may be such that they are likely to have greater periods of absence than an employee not suffering from such a disability. Where an employer's sick pay scheme imposes a limit on the number of days that full pay may be paid to a sick leaver, such a disabled employee will be at a greater disadvantage.
Active management by a holding company can trigger a TUPE transfer
The Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) can result in unpalatable restrictions on the purchaser of a business (for example, detrimental changes to the terms and conditions of a transferring employee will be void). Because it is well established (Brookes v Borough Care Services) that a share sale does not of itself transfer the business for the purposes of TUPE, transactions are sometimes structured as share sales to provide the purchaser of a business with greater flexibility in relation to its plans for the workforce, all other considerations being equal. Once the share sale is complete, it is not unusual for a parent/holding company to take an active interest in the management of the company acquired. However, a recent Court of Appeal decision gives rise to the possibility that an excessive level of involvement could, in fact, trigger a TUPE transfer of the business to the holding company.
Unfair dismissal by transferor: transferee's business requirements irrelevant
The Transfer of Undertakings (Protection of Employment) Regulations 2006 provide that the dismissal of an employee because of, or for a reason connected with, a business transfer is automatically unfair. If, however, the dismissal is for an economic, technical or organisational (ETO) reason, the dismissal is not deemed automatically unfair. It is instead judged by the employment tribunal according to the normal principles of fairness, ie was there a substantively fair reason for the dismissal and was a fair procedure followed?
DTI advised to scrap statutory grievance and dismissal procedures
The DTI has published an independent review of the current dispute resolution regime. Its key message is that the current dispute resolution regulations are too inflexible and prescriptive and as a consequence have been unsuccessful. A number of recommendations have been made, the most significant of which is that the statutory dismissal and grievance procedures should be repealed.
Public interest disclosure - reasonable belief about an actual criminal offence is not necessary
The Employment Rights Act 1996 (ERA) provides that an employee who is dismissed as a consequence of having made a protected disclosure is to be regarded as unfairly dismissed.
Statutory dismissal procedure
new allegations of misconduct require a separate procedure to be followed
Where an employer is contemplating dismissing an employee it is obliged to follow the statutory dismissal procedure in relation to the proposed dismissal. Step one of the procedure requires the employer to set out in writing the alleged conduct which has led it to contemplate the dismissal or disciplinary action and then invite the employee to a meeting to discuss the matter.
Modified grievance procedure - how much detail needs to be included?
Part 2 of Schedule 2 to the Employment Act 2002 sets out the standard form and modified grievance procedures. The standard grievance procedure involves three steps, the first of which is that the employee must submit a written grievance to the employer. The employee is not, however, required to inform the employer of the basis for the grievance as part of step one but must do so, although not necessarily in writing, before the step two meeting takes place.
Extent of an employee's fiduciary duties and duty of fidelity - preparatory steps to compete
It is the fiduciary duty of a director to act in good faith in the best interests of their company. They must do their ‘best to promote its interests and to act with complete good faith towards it' and not place themselves in a position in which their own interests conflict with those of the company (see Item Software (UK) Ltd v Fassihi and others). Employees who are not actual or de facto directors have an implied contractual duty of fidelity to their employer which includes not working in a competing business while still employed.
Work-related stress: counselling services do not absolve an employer of responsibility
All employers have a common law duty to take reasonable care to protect their employees from foreseeable harm to their physical or mental health. In order to succeed with a personal injury claim in relation to, for example, psychiatric injury resulting from a breakdown, an employee must be able to demonstrate that:
Advocate General's opinion on default retirement age
In the case of Palacios v Cortefiel Servicios SA the ECJ was asked to consider whether a national law allowing for compulsory retirement upon attaining a certain age was inconsistent with the EU Equal Treatment Framework Directive (2000/78/EC), pursuant to which the Employment Equality (Age) Regulations 2006 were implemented.
Expired disciplinary warnings may not be taken into account when determining disciplinary sanctions
What is the status of a disciplinary warning that has expired? In Airbus UK Ltd v M G Webb the EAT had to consider whether an expired warning, or more particularly the conduct in respect of which the warning had been given, had to be treated for all purposes by the employer as if it had never occurred in the context of subsequent disciplinary proceedings relating to similar misconduct.
Restrictive covenants: a year's restriction is justifiable
It is common practice for employment contracts to contain a variety of post-termination restrictions prohibiting the departing employee from soliciting former colleagues, clients and customers and sometimes prohibiting them from competing for a defined period following the termination of employment.
TUPE: contractual variations are not invariably void
The Transfer of Undertakings (Protection of Employment) Regulations 1981 (TUPE) gave effect to the Acquired Rights Directive, the underlying purpose of which is to safeguard the rights of employees who transfer. Having regard to this underlying protective aim, the courts have concluded that where detrimental changes to terms and conditions are made as part of a package of changes in connection with a business transfer, they are void.
Temporary redeployment permissible in exceptional circumstances
From time to time an employer may find that it needs to redeploy an employee to another post, but the individual's contract does not contain any express provisions allowing for such redeployment. The Employment Appeal Tribunal (EAT) has examined the case law on this area and provided useful guidance on when such redeployment may take place.
Compromise agreements: accuracy of recitals is essential for enforcement
In Palihakkara v British Telecommunications Plc the EAT was asked to consider whether P was entitled to bring sex and race discrimination claims even though she had concluded a compromise agreement:
‘... in full and final settlement of all claims past or future arising out of the termination of her employment... including... claims in respect of... unfair dismissal, discrimination on grounds of race, sex and/or disability.'
Agency workers: when can a contract of employment with the end-user be implied?
The employment status of workers supplied by employment agencies has come under scrutiny in recent years. In Brook Street Bureau (UK) Ltd v Dacas, the Court of Appeal indicated that when assessing the employment status of an agency worker, employment tribunals should actively consider whether there is an implied employment contract between the worker and the end-user client regardless of what has been agreed by the parties.
Time out: additional holiday entitlement
At present, the Working Time Regulations 1998 give all workers the right to four weeks of paid leave per year. For an employee working a five-day week, this gives rise to an entitlement of 20 days. Some employers currently include the eight public and bank holidays in their employee's holiday entitlement. Following a period of consultation, the government has announced that it intends to grant additional paid leave to reflect the eight bank holidays. In short, it proposes to increase the statutory entitlement to paid holiday initially from four weeks to 4.8 weeks from 1 October 2007. Paid holiday entitlement will then increase by a further 0.8 weeks to 5.6 weeks with effect from 1 October 2008, subject to a maximum statutory entitlement of 28 days. Employees will not be required to have a minimum period of employment in order to qualify for this additional holiday entitlement.
The 2007 employment law year
By Tania Stevenson
Interaction of company and statutory disciplinary procedures
A dismissal on the grounds of misconduct will only be fair if the following conditions are satisfied:
Glitches in the post - beware employment tribunal time limits
If a claim is brought in the Employment Tribunal and a ‘response' (ie an ET3) is not lodged in time, the employment tribunal can issue a default judgment against the respondent in relation to either liability alone or in relation to both liability and remedy. In addition, the respondent may take no further part in the proceedings (except for very limited purposes, eg to be called as a witness by another).
Enhanced redundancy schemes can survive the expiry of a collective agreement
In many workplaces where there is union recognition it is common for the employer to operate an enhanced redundancy scheme, the origins of which can be traced back to a collective agreement. The Employment Appeal Tribunal (EAT) was asked, in Framptons Ltd v Badger, to consider whether employees were entitled to an enhanced redundancy payment after the expiry of a collective agreement which was the source of the redundancy terms.
High hurdle for employees challenging size of discretionary bonus
It is common practice (particularly in the City) for employers to describe their bonus arrangements as discretionary and to provide that no bonus will be payable if an employee is not in employment, or is under notice (given or received), on the bonus payment date. There has, however, always been a degree of uncertainty about the enforceability of such a provision - the concern that the employee is effectively a ‘consumer' in the relationship and that such a provision falls foul of the Unfair Contract Terms Act 1977 (UCTA) because it allows the employer to render a substantially different performance from that reasonably expected of it. Employers have also been advised that labelling a bonus as discretionary does not give them carte blanche to act arbitrarily, as the courts have held in a number of cases that there is an implied term that an employer's discretion will not be exercised in a capricious or perverse manner (see Clark v Nomura International Plc and Horkulak v Cantor Fitzgerald).
New unfair dismissal and redundancy limits
New award limits will apply in relation to unfair/redundancy dismissals that take effect on or after 1 February 2007. Employers who are currently costing termination exercises that will take effect after 1 February 2007 will need to factor these new limits into their calculations.
Handbook statement on enhanced redundancy scheme has contractual effect
It is common practice for employment handbooks to be divided into contractual and non-contractual sections. Typically, policies and procedures will be contained in the non-contractual section to minimise the risk of breach of contract claims being brought if policies are not strictly adhered to, and to allow the employer greater flexibility when changing the policies and procedures without the need to obtain prior consent from employees before doing so. Although, strictly speaking, consent may not be required, it would nevertheless be good practice to consult and give notice before implenting new policies and procedures.
Age discrimination: objective justification
The Employment Equality (Age) Regulations 2006 (the Age Regulations) allow employers to defend a claim of either direct or indirect age discrimination by objectively justifying the acts complained of. Recently, Unison launched a judicial review in the High Court to challenge the government's decision to alter the Local Government Pension Scheme arrangements. The Scheme allowed employees to retire early on full pensions provided that their age and years of service added up to 85 (the 85 year rule).
Service-related pay: an automatic defence to equal pay claims?
The EU principle of equal pay for equal work is implemented in England through the Equal Pay Act 1970. The Act implies ‘an equality clause' into every employee's contract of employment to the extent that one does not already exist from the outset. The effect of the equality clause is that where a woman can demonstrate that she is employed on:
Misconstruing employment status can prove costly
Many organisations use atypical working arrangements to keep their ‘employee' headcount low and to avoid statutory employment obligations - giving them greater flexibility to hire and fire such casual staff at will. Employment status is significant not only in terms of what statutory employment protection may exist, but also from a number of other legal perspectives, including an employer's liability for making tax and social security deductions, and complying with immigration requirements, and health and safety legislation.
Useful guidance for employers on smoke-free workplaces and sexual harassment
THE TUC and the Equal Opportunities Commission (EOC) have recently issued useful guidance documents for managers and employers on topical employment issues.
Payment of full pay to disabled sick leavers is not a reasonable adjustment
The provisions of the Disability Discrimination Act 1995 (DDA) impose an obligation on employers to make a reasonable adjustment where a provision, criterion or practice is placing a disabled employee at a substantial disadvantage when compared to employees who are not disabled.
Provision of a counselling service is not a defence to a PI claim
An employee who suffers a breakdown as a consequence of the strains and stresses of their work situation will only succeed with a personal injury claim against their employer if they can demonstrate that there was a real risk of breakdown, which the employer ought reasonably to have foreseen, and that there were steps it could have taken to prevent the breakdown.
Contract of employment and mutuality of obligation
There is a vast amount of case law on the question of what test should be applied when determining the employment status of an individual. It has, however, been made clear that there cannot be a contract of employment without ‘mutual obligation', see for example the House of Lords' decision in Carmichael and another v National Power Plc. What does mutuality of obligation mean in practice?
Redundancy selection criteria
In the case of British Aerospace v Green Millett LJ observed that when an employer carries out a redundancy exercise it is:
‘... sufficient for the employer to show that he has set up a good system of selection and that it was fairly administered, and that ordinarily there is no need for the employer to justify all the assessments on which the selection for redundancy was based.'
Employers can be vicariously liable for breach of the 'Stalkers Statute'
The ‘Stalkers Statute’, otherwise known as the Protection from Harassment Act 1997 (PHA), prohibits a person from pursuing a course of conduct which amounts to harassment of another. Harassment for these purposes can include alarming a person or causing them distress. To qualify, the conduct must occur on at least two occasions.
Successive use of fixed-term contracts: proceed with caution
The Fixed-Term Employee (Prevention etc) Regulations 2002 restrict an employer’s ability to use successive fixed-term contracts. The Regulations achieve this by classifying an employee engaged under a fixed-term contract as a permanent employee if all of the following conditions are satisfied:
The end of smoking in the workplace as we know it
In July the government issued a consultation on the Smoke-Free (General Provisions) Regulations. These Regulations will form part of the smoke-free regime that will be implemented in summer 2007 by the Health Act (currently the Health Bill). The consultation closed on 9 October 2006.
Proposed reforms to Corporate Manslaughter Bill: do they go far enough?
The notion of ‘corporate homicide' or ‘corporate killing' first surfaced in the late 19th century with workplace deaths in the era of industrialisation. In recent years it has risen rapidly up the political agenda, especially as a result of tragedies such as the Zeebrugge ferry disaster. Indeed, over 300 people per year die or are fatally injured at work, demonstrating that the potential scope for liability is wide. In spite of this there have only been a handful of successful prosecutions of large companies where management failings have resulted in death.
Proposed changes to the maternity leave regime
As part of the Government’s aim of helping employees achieve a better work/family care balance, further changes are to be made to the maternity leave regime.
More time off: new government proposals
The Government has issued a consultation document on its proposals to increase the statutory minimum holiday entitlement from four weeks to 5.6 weeks per year (see ‘Increasing the holiday entitlement - an initial consultation' at www.dti.gov.uk/employment/holidays/index.html).
Detrimental treatment after the end of employment can form the basis of a whistleblowing claim
In Woodward v Abbey National Plc the Court of Appeal (CA) was asked to consider whether a claim could be brought alleging that an individual had been subjected to detrimental treatment on the grounds that she had made a protected disclosure, where that detrimental treatment arose after the termination of employment.
Failure to consult a disabled employee about reasonable adjustments is not disability discrimination
In Tarbuck v Sainsbury's Supermarkets Ltd, the EAT considered an alleged failure to make a reasonable adjustment under the Disability Discrimination Act 1995 (DDA).
Disability discrimination: reasonable adjustments in relation to sickness absence
The question of whether or not disability-related sickness absence should be discounted for the purposes of sickness absence procedures and redundancy selection is unclear as there is very little case law guidance. The Employment Appeal Tribunal (EAT) recently looked at the issue in Royal Liverpool Children's NHS Trust v Dunsby.
Bank holiday entitlement of part-time workers
The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 provide that a part-time worker has the right not to be treated less favourably than the employer treats a comparable full-time worker as regards the terms of their contract, or by being subjected to any other detriment.
DTI guidance on working time regulations
The DTI Guidance on the Working Time Regulations 1998 has now been amended to reflect the European Court of Justice’s (ECJ) decision in Robinson-Steele v RD Retail Services Ltd and others, in which it was held that rolled-up holiday pay arrangements infringed the EC Working Time Directive.
Redundancy exercises: duty to provide information about suitable or alternative employment
In Fisher v Hoopoe Finance Ltd, the Employment Appeal Tribunal considered whether an employer had fulfilled its duties during a redundancy exercise.
Revised Code of Practice on Racial Equality in Employment
On 6 April 2006 the Commission for Racial Equality’s new statutory Code of Practice on Racial Equality in Employment came into effect. This Code replaces the CRE’s original Code of Practice, which was published in 1984.
Statutory dispute resolution procedures: uplifting compensation
The second anniversary of the introduction of the statutory dispute resolution procedures is looming on the horizon. By now, employers should be accustomed to following the statutory dismissal, disciplinary and grievance procedures in appropriate circumstances.
Bonus payments for maternity leavers
The question of whether a bonus is payable (at all or in part) to an employee who has been absent on maternity leave for all or part of the relevant bonus period is a complex issue that continues to perplex employers and lawyers alike. Unfortunately, given the variety of permutations that bonus arrangements may take, there is not a single answer that is applicable in all cases. The case law on this subject has been quite elusive with only a small number of first instance decisions directly on the issue, and a number of ECJ cases not directly on point dealing with bonuses and parental leave (Lewen v Denda) and pay rises during the currency of maternity leave (Alabaster v Woolwich).
Redundancies and the statutory DPP: guidance on an employer
Where an employer proposes to dismiss an individual by reason of redundancy the statutory dismissal procedure will apply unless the dismissal is part of a collective redundancy procedure, that is the employer is proposing to dismiss 20 or more employees within a 90-day period. Dismissal on the grounds of redundancy is a potentially fair reason to dismiss. However, the dismissal must also be procedurally fair, and comply with the statutory disciplinary and dismissal procedure (DDP).
Repeated use of temporary contracts can give rise to continuity of employment
In some sectors, companies maintain registers of suitably qualified individuals on whose skills they can draw as and when their business needs dictate. Typically, under such arrangements the individual in question is not obliged to accept a particular assignment, nor is the company obliged to offer further assignments on completion of any assignment accepted. Such bank workers are frequently regarded by the end-user as a temporary contractor.
Implying terms into an executive service contract
One possible danger of not spelling out the precise terms of an employee's engagement is illustrated by Bellingham v Secession Ltd, in which the employment tribunal implied very generous sick pay terms into an employment contract.
Rolled-up holiday pay: impact of recent ECJ decision
It is not an uncommon practice for employers of workers who have atypical working arrangements (eg casual employees with no fixed number of hours' or days' work per week, shift workers and consultants) to pay them a rolled-up rate of pay that is inclusive of holiday pay.
HR1 notification - proposed changes
The government is currently consulting on new regulations that will make it clear that the HR1 notification to the Secretary of State of proposed collective redundancies should take place before notices of dismissal are issued. This amendment is being proposed as a consequence of the ECJ decision in Junk v Kuhnel in which it was held that no notice of dismissal may be given until:
New rates for statutory pay
Set out below are the new rates applicable to statutory maternity pay (SMP) and statutory sick pay. The new SMP rate will also apply to statutory adoption pay and statutory paternity pay.
Transfer of undertakings: the new regime
On 6 April 2006 the Transfer of Undertakings (Protection of Employment) Regulations 2006 (‘TUPE 2006') will finally come into effect after a four-and-a-half year gestation period.This will replace the existing, and somewhat long-in-the-tooth, regime, which is governed by TUPE 1981. Although TUPE 2006 rests on the foundations of TUPE 1981, it introduces a number of new obligations and clarifying provisions (see box, right), which this briefing will outline.
Statutory formula for calculating redundancy payments: update
At present, when an employee with two or more years' service is made redundant they will be entitled to a statutory redundancy payment calculated according to the following formula:
New guidance on discrimination against part-time workers
The Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 provide that a part-time worker is entitled not to be treated less favourably than a comparable full-time worker. To succeed with a claim the worker must demonstrate that they are employed by the same employer under the same type of contract as the full-time comparator employee, and that both are engaged in the same or broadly similar work having regard to their level of qualification, skills and experience.
Deemed employment and vicarious liability in the context of contracted-out services
In ViaSystems (Tyneside) Ltd v Thermal Transfer (Northern) Ltd and others, the Court of Appeal looked at the issue of who was vicariously liable for the negligence of an employee working temporarily for another company. In that case the Court held that it is possible for both the general employer and the temporary employer (ie the company to whom the individual is temporarily providing his services) to be vicariously liable for the negligent acts of an employee. The key issue in the Court’s opinion was who had control of the individual’s work at the time that the negligent act was committed.
In Hawley v Luminar Leisure Ltd the Court of Appeal again considered the issue, this time in relation to a ‘door supervisor’ (aka a bouncer).
Disability discrimination: failure to make reasonable adjustments is breach of trust and confidence
Where a provision, criterion or practice applied by an employer, or a physical feature of premises places a disabled employee at a substantial disadvantage in comparison with persons who are not disabled, the employer has a duty to take such steps as are reasonable to prevent that effect.
Unfair dismissal: disciplinary hearing held in employee
The ACAS Code of Practice on Disciplinary and Grievance Procedures states that it is a core principle of reasonable behaviour that an employee has the opportunity to state their case at a meeting before being dismissed for misconduct.
Disability discrimination: tests for reasonable adjustments and justifiable discrimination
Section 3A(1) of the Disability Discrimination Act 1995 (as amended) (DDA) provides that it is discriminatory for an employer to treat a disabled person less favourably than others for a reason related to their disability where such less favourable treatment is not justified. Section 3A(3) states that treatment is justified if it is material to the circumstances of the particular case and substantial.
DDA: reasonable adjustments may involve creating new post
In Southampton City College v Randall the EAT held that the provisions in the DDA that impose an obligation on an employer to make a reasonable adjustment (see above) do not:
Statutory grievance procedures: when is Step 1 satisfied?
In October 2004 the statutory disciplinary, dismissal and grievance procedures came into force. In general, an employee will not be able to lodge a claim at the employment tribunal against their employer unless they have complied with Step 1 of the statutory grievance procedure (GP) and waited 28 days. This applies, amongst other things, to claims of constructive dismissal and discrimination (on whatever grounds). The GP does not, however, apply to complaints about dismissal (other than constructive dismissal). The standard GP is made up of three steps:
Work and Families Bill
In February 2005 the government published its consultation document ‘Work and Families: Choice and Flexibility’, which set out its proposals for achieving a better work/care balance for families. The consultation closed on 25 May 2005, and the government published its response in October. The proposals are intended to form the basis of the Work and Families Bill that was presented to Parliament for its first reading on 18 October 2005.
Disability discrimination: EAT considers employer?s constructive knowledge
When will an employer be deemed to have ‘constructive’ knowledge of an employee’s disability? This issue was considered by the EAT in Department for Work and Pensions v Hall in the context of claims for disability-related discrimination and failure to make a reasonable adjustment.
Sex discrimination: ECJ rules on sick-pay entitlement in relation to pregnancy-related illness
In North Western Health Board v McKenna the European Court of Justice (ECJ) considered whether it amounted to sex discrimination (i) for an employer to treat an employee absent due to pregnancy-related illness in an identical manner as employees absent for other ill-health reasons for the purposes of sick pay entitlement; and (ii) for an employer to offset absence due to a pregnancy-related illness against an employee’s total occupational sick pay entitlement.
Protective award quantification: factors to be taken into account
Section 188 of the Trade Union Labour Relations Consolidation Act 1992 (TULRCA) imposes collective consultation obligations on an employer in the event that they propose to dismiss as redundant 20 or more employees at one establishment within a 90-day period. If an employer fails to comply with the section 188 obligations, an application may be made to the employment tribunal (ET) for a protective award of up to 90 days’ pay per affected employee.
Disciplinary and grievance procedures: retaining the right to deviate in appropriate circumstances
In light of the EAT dicta in C&J Clark International Ltd v Hatcroft, when reviewing or drafting disciplinary and grievance procedures employers should include a clause that, broadly speaking, allows them to vary and/or suspend all or part of the procedure if it is considered appropriate in individual cases.
Courts confirm new statutory regime
It is very common for employees returning from maternity leave to request a return on a part-time or some other flexible basis to accommodate their new childcare responsibilities.
Draft regulations outlawing age discrimination issued for consultation
A little behind schedule, the government has now issued for consultation the draft Employment Equality (Age) Regulations 2006 (the Age Regulations), which will outlaw discrimination on the grounds of age with effect from 1 October 2006.
Classifying a dismissal as a redundancy for presentational purposes is not always advisable
In Bowyer v Siemens Plc, the Employment Appeal Tribunal (EAT) considered a rather obscure area of employment law - unfair dismissal compensation and the deduction of redundancy payments - which has wider implications for employers who label dismissals as 'redundancies'.
Introducing a smoking ban in the workplace: government proposals
The government has recently issued a consultation paper on smoking in public places and workplaces as part of the Health Improvement and Protection Bill.
Parental leave cannot be taken in units of one day
Employees who have more than one year's continuous service and have responsibility for a child under the age of five are entitled to 13 weeks' unpaid parental leave to take care of the child. The rules governing when and how much parental leave may be taken and what notice must be provided by an employee are set out in the Maternity and Parental Leave etc Regulations 1999 (the Regulations).
When can an 'international' employee bring unfair dismissal proceedings in an English employment tri
In today's increasingly global workplace many employees' roles will involve an overseas dimension. This could take a variety of forms, for example travelling and working abroad for short periods throughout the year, being seconded abroad on single or successive assignments, being permanently based overseas but reporting into a UK base, and so on.
Equal pay claims - compensation for injury to feelings is not recoverable
The Equal Pay Act 1970 (EPA) seeks to avoid direct and indirect sex discrimination in relation to employees' contractual entitlements by implying into a woman's contract an equality clause. This clause ensures that where she is engaged to perform the same type of work as a male comparator, or work that is not the same but has been rated as equivalent or of equal value, the terms of her contract become as favourable as his corresponding contractual terms. The implied term cannot, however, give the woman more favourable terms and will, in any event, not operate if the employer can demonstrate that the difference in terms is genuinely due to a material factor other than sex.
Transfer of undertakings legislation - the shape of things to come
In March this year, almost four years after its initial consultation exercise, the government issued for consultation draft regulations that amend the current Transfer of Undertakings (Protection of Employment) Regulations 1981 (TUPE 1981). The consultation closed in June. It was originally intended that these amending regulations, the Transfer of Undertakings (Protection of Employment) Regulations 2005 (TUPE 2005), would come into effect on 1 October 2005. However, the DTI has recently announced that TUPE 2005 will now come into effect in April 2006.
More employer consultation obligations proposed - this time it's pensions
It is the Government's intention that, from 6 April 2006, employers with more than 150 employees will have a statutory obligation to consult with prospective and active members of occupational and personal pension schemes, and their representatives, before making certain specified changes to future pension arrangements. A consultation document on the draft Occupational and Personal Pension Scheme (Consultation by Employers) Regulations 2006 has just been issued.