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Employment Law Roundup – November 2017

November 2nd, 2017

With sexual harassment so much in the news, this is a good opportunity for employers to make sure that they are taking adequate steps to protect themselves from claims. The key point to understand is that employers will be liable for any harassment of one employee by another if it is done ‘in the course of employment’. This is a wide enough test to cover not only inappropriate behaviour in the workplace but also things said and done within the context of work – including business trips, conferences and work-related social functions. It is a cliché to warn employers of the potential dangers of the office Christmas party, but this year such warnings will carry some additional weight.

The best way an employer can protect itself against claims for harassment is to try their best to ensure that employees do not harass their colleagues. This is not just because there will then be no harassment on which a claim can be based, but also because an employer has a defence to a claim if it can demonstrate that it took all reasonable steps to prevent the harassment from occurring. To meet this test the employer will have to show that it treats harassment as serious misconduct and ensures  – through induction and training – that all staff are aware of the standards of behaviour required. It is important that the matter is not simply dealt with in a written policy that sits somewhere near the back of the employee handbook, but that the employer actively promotes a workplace culture that does not tolerate harassment and encourages employees to speak up at an early stage if the behaviour of a colleague makes them feel uncomfortable. Employers who meet this standard will not only enjoy a measure of legal protection – they will also be providing happier and more productive places to work.

Whistleblowing

An employee is entitled not to be dismissed for whistleblowing – or making a ‘protected disclosure’ to use the language of the legislation. But how can you tell what the reason for dismissal is if it is the result of the actions of more than one manager – only one of whom may have had the disclosure in mind? In Royal Mail Ltd v Jhuti the employee had made internal disclosures about the way in which existing customers had been offered incentives that she alleged breached OFCOM guidance. When her manager heard of these disclosures he was very hostile towards her – even forcing her to draft an apology. She was a new employee and had to pass her probation period in order to have her employment confirmed, but found that the behaviour of her manager towards her was the cause of increasing stress. She was eventually signed off as sick and subsequently dismissed.

The decision to dismiss her was made by another manager who genuinely believed that she was unable to meet the standards required of her. That decision was made on the basis of misleading information given by her line manager, but the tribunal found that that fact was not sufficient to mean that the protected disclosures formed part of the reason for dismissal. Accordingly, while Ms Jhuti had been subjected to an unlawful detriment in the way in which she had been treated by her line manager, she had not been automatically unfairly dismissed for making a protected disclosure.

The case reached the Court of Appeal, which agreed with this approach. The reason for the employer’s decision to dismiss an employee could only refer to the mental processes of the person who actually made the decision. In this case, the person who decided to dismiss did not do so because the employee had made a protected disclosure. It followed that the dismissal was not automatically unfair – and of course the employee did not have sufficient service to claim unfair dismissal on the normal principles of reasonableness.

This did not mean, however that the employee was unable to recover for the losses she had suffered as a result of her dismissal. The Court of Appeal held that if the action taken by Ms Jhuti’s line manager led to her being dismissed, then the compensation awarded by the tribunal for unlawful detriment could take into account the loss caused by her dismissal. The matter was sent back to the tribunal to decide on the appropriate remedy.

Voluntary redundancy

Employers will often consider offering an incentive to employees to volunteer for redundancy in order to reduce the need for compulsory redundancies. Doing so carries the risk, however, that the wrong people might volunteer. To protect the business it is therefore important for the employer to retain a discretion as to whether or not to accept an application for voluntary redundancy. Nevertheless the creation of a voluntary redundancy scheme may create contractual rights that take the employer by surprise. In Lynham & Rooney v Birmingham City Council the Council undertook a major restructuring programme and announced that there would be an opportunity for ‘eligible’ employees to apply for voluntary redundancy on favourable terms.

Two employees – Mrs Lynham and Mr Rooney – sought to apply for voluntary redundancy but were told that they were not eligible to apply. The employer’s view was that the section in which they were employed was to be closed down completely and so it was inevitable that they would be selected for compulsory redundancy. On that basis, the employer said there was no point in giving them an opportunity to volunteer first.

They claimed that the refusal to allow them to claim voluntary redundancy meant that their dismissals were unfair – and also in breach of contract. The Tribunal rejected both claims and the employees appealed purely on the contractual issue. They argued that the employer had clearly announced that employees affected by the restructuring exercise would be entitled to apply for voluntary redundancy. The Council sought to distinguish between employees who were ‘affected’ by the restructuring and those who were ‘eligible’ for voluntary redundancy. It was the latter group that were directly contacted by the employer to give them details of how they could apply and the Council argued that since there was no obligation to offer any sort of voluntary redundancy scheme, it was a up to them to decide who should be eligible for the scheme that they introduced.

The EAT disagreed. In communicating the availability of the scheme the Council had used the terms ‘affected’ and ‘eligible’ interchangeably. The impression given was that anyone who was affected by the restructuring would be entitled to apply for voluntary redundancy. This amounted to a contractual statement and so the Council was in breach of contract when it refused to allow the two employees to volunteer.

That did not mean, of course, that the employees had the right to have their applications for voluntary redundancy accepted. But the EAT suggested that the employer would not be able to show a valid basis for refusing based merely on the fact that the employees would inevitably have been selected for compulsory redundancy. Accepting the employees as volunteers in such circumstances would still have achieved the aim of reducing the number of compulsory redundancies. It was ultimately for the tribunal to decide whether the employer could reasonably have refused their applications and judge what loss – if any – they had suffered as a result of the employer’s refusal to allow them to apply.

Trade Union Discrimination

It is unlawful to dismiss an employee for being a member of a trade union. Less well known is that it is also unlawful to refuse to employ someone on the grounds of their union membership. In Jet2.Com Ltd v Denby, Mr Denby had previously worked for the airline Jet2.Com as a pilot. He had been a prominent member of the Pilot’s union – BALPA – and had sought to persuade the airline’s executive chairman to recognise the union. He had met with an extremely hostile response  – with the chairman referring to Mr Denby in terms too obscene to repeat here and which even the Tribunal felt obliged to reduce to a series of ***s.

Mr Denby subsequently left Jet2.Com to work elsewhere, but some years later applied to return. He made two separate applications but each was rejected. The Tribunal found that his recruitment had been blocked by the executive chairman on the basis that he had played an active role in seeking union recognition for BALPA. They therefore upheld his claim that he had been refused employment because of his membership of a trade union.

The employer appealed on the basis that the law only prohibited an employer from refusing to recruit someone because of their trade union membership. It was not Mr Denby’s membership of BALPA that the tribunal had found to be the reason for the refusal to recruit him, but the history he had of actively campaigning for union recognition. The EAT rejected this argument. It was well established that a wide view had to be taken of what was meant by union membership so as to include not merely membership but also the participation in union activities. Mr Denby’s previous activities on behalf of the union were inextricably wound up with his status as a union member and it followed that the reason for Jet2.Com’s refusal to employ him did indeed relate to his union membership. The appeal was dismissed.

Race Discrimination – burden of proof

There are few issues more complicated than the burden of proof in discrimination cases. The Equality Act specifies that where there are facts from which – in the absence of an explanation from the employer – discrimination could be inferred, then the burden is placed on the employer to prove that there has been no discrimination.

What this means in practice is that where there is an accusation of discrimination, the employer must stand ready to provide evidence as to the reason for its conduct, rather than simply rely on the employee not having enough evidence to demonstrate that discrimination has taken place.

In Olatanwo v QualityCourse Ltd Mr Olatanwo was a Nigerian national with a permanent right to reside and work in the UK. He applied for a role with QualityCourse Ltd and was accepted, subject to the usual requirement that he demonstrate that he was entitled to work in the UK. He provided this in a range of documents, but his manager was concerned that his permanent residence card was stamped into his old, out of date, passport. This did not in fact affect its validity, but the employer nevertheless sought to check his ability to work in the UK via the Home Office online checking service. Unfortunately the online form was filled in incorrectly with the manager omitting to mention crucial documents that Mr Olatanwo had in fact provided.  As a result, the Home Office stated that it was unable to confirm Mr Olatanwo’s right to work in the UK and he was dismissed.

By the time the employer came to accept that he was in fact entitled to work in the UK – and that he had presented all of the documentation needed to establish that fact – Mr Olatanwo had found work elsewhere and no longer had faith in his former employer. He alleged that his treatment amounted to race discrimination because it was based on prejudiced assumptions based on his Nigerian nationality. Giving evidence for the employer, his manager said that he had only acted on the explicit instructions of members of the employer’s internal compliance team, who were not called to give evidence.

The Tribunal accepted that the burden of proof lay on the employer to prove that there was no discrimination and went on to find that the employer had discharged that burden. The Tribunal accepted that the employer had merely fallen into error because it was confused about the documentation that was required and had failed to appreciate that Mr Olatanwo had provided everything that was needed.

The EAT allowed an appeal against this finding. The error that the Tribunal had made was to treat the role of the compliance team as being merely advisory, with the line manager being the decision maker. It was clear from his evidence, however, that he was acting on the instructions of his colleagues. This meant that their mental processes were relevant to the question of whether there had been discrimination – not just in the decision to dismiss but also in the way in which the document checks had been handled. For example, the compliance team had refused to accept Mr Olatanwo’s assurances that his residence card remained valid despite it being stamped on his old passport. Could this refusal have been based on stereotypical assumptions? The case was sent back to the Tribunal to consider the matter afresh.

…and more on proving discrimination

The issue of the burden of proof was also to the fore in Kumar v DHL Services Ltd. Mr Kumar applied for a managerial post with the employer but was unsuccessful. He suspected that he had been subjected to discrimination when he was given feedback on his interview which suggested that he was not as assertive as the role demanded and that his previous experience meant that the new role would be a ‘step down’ for him. He felt that this was not a fair reflection of what had happened at the interview and that it indicated some other motivation behind the decision not to recruit him.

On hearing the case the tribunal decided – with the agreement of the parties – to act on the assumption that the burden of proof fell on the employer and move straight to the question of the ‘reason why’ Mr Kumar’s application was unsuccessful. The Tribunal made a number of criticisms of the recruitment process but accepted the evidence of the manager as to why she had felt that Mr Kumar was not suitable for the position and dismissed his claim.

On appeal Mr Kumar argued that more weight should have been given to evidence showing a lack of diversity in the employer’s management structure and a lack of equal opportunities training for those taking part in recruitment exercises. There had also been no clear selection criteria set out for the job in question and the notes kept in relation to the interviews had been inadequate. The EAT accepted that these were all relevant circumstances for the Tribunal to consider, but they did nothing more than point to the possibility of discrimination taking place. The tribunal had accepted that possibility by considering the case on the basis that it was for the employer to prove that there was no discrimination. What mattered was the actual reason for the rejection of his application and the tribunal had carefully tested and then accepted the evidence of the manager as to why Mr Kumar had not been offered the role. By accepting that evidence, the tribunal had found that race did not form part of the employer’s reasoning and there was no wider obligation to show that the recruitment process was a fair or reasonable one. The appeal was dismissed.

Indirect sex discrimination

The UK is still a member of the EU and so decisions of the European Court of Justice continue to be binding on UK courts when interpreting areas covered by EU law – such as discrimination. The Greek case of Esoterikon v Kalliri is hardly ground-breaking, in fact, it almost has a nostalgic feel. The case concerns the recruitment of candidates for places in police training schools, which required that all candidates had to be at least 1.7m tall (just over 5’6’’). A discrimination case was brought by Ms Kalliri who was just two centimetres short of the required height.  The Greek court found that a much larger proportion of women than men would be unable to meet the height requirement, but it nevertheless decided to refer the question to the European Court of Justice.

The CJEU held that women were clearly placed at a particular disadvantage by the requirement. The key issue was whether the employer could show that the requirement was justified. That was a matter for the national court to decide, but the CJEU was able to provide some guidance on the issue. The Greek Government claimed that it was appropriate and necessary for police officers to have a certain physical stature in order to perform effectively. The CJEU, however, said that even if the duties of a police officer required a certain ‘physical aptitude’, it was not clear that such an aptitude was necessarily connected with height. In other words, just because someone was shorter, that did not mean that they lacked the physical presence needed to be an effective police officer.  The aim of ensuring the selection of suitable candidates could better be achieved through specific tests of each candidate’s physical ability. It followed that the defence of justification would be unlikely to succeed and the height requirement would amount to unlawful discrimination.

Reinstatement and reengagement

One of the remedies available for unfair dismissal is an order for reinstatement or reengagement. Reinstatement means returning the employee to his or her original job. Reengagement means giving the dismissed employee a suitable new job with the same organisation. These orders are seldom used, partly because an unfairly dismissed employee will not usually want to return to an employer who treated them unreasonably. Another important factor is that reinstatement or reengagement orders will only be made if the tribunal considers that it would be practicable for the employer to comply with them. Where there has been a breakdown in trust and confidence – or where the employer clearly does not have the resources to take the employee back – then the Tribunal is unlikely to make an order and will award compensation instead.

In the case of Dafiahghor-Olomu v Community Integrated Care the employee was a Nigerian national who required a permit to work in the UK. This meant that when she was unfairly dismissed it was particularly important for her to return to employment for which such a permit was available and so she sought reengagement. The tribunal declined to make an order because by the time of the remedy hearing the employer had ceased to operate in Scotland – where she lived and where she had been based – having lost the contract under which she was employed to a competitor. On appeal, the EAT held that this was the wrong approach. The employer had a national presence covering both England and Wales with thousands of employees. While it was clear that her original post was no longer available – so that an order for reinstatement would not be appropriate – there was still the possibility of ordering the employee to be reengaged elsewhere. The Tribunal had assumed that this would not have been practicable because it would have required the employee to relocate. But this failed to take into account the fact that the employee was perfectly willing to do so if a suitable role was made available. Had the order been made, the issue of whether a suitable vacancy actually existed could have been explored and the employer would have had a further opportunity to argue that reengagement was not practicable if it emerged that the nothing suitable was available. The matter was sent back to the Tribunal to be reconsidered.

As an alternative, the employee had argued that a reengagement order could have been made against the company that won the Scottish contract from her employer. She relied on the fact that the legislation allowed an order to be made against the original employer or its ‘successor’. The EAT agreed with the tribunal, however, that this provision had a very narrow scope which would only cover a company which had actually assumed ownership of the employer’s business. While the loss of the contract to the rival contractor would have been a TUPE transfer, this did not affect the employee because she was no longer employed by the time the transfer took place. The subsequent contractor did not therefore have any liability in relation to her dismissal and could not be the subject of an order for reinstatement or reengagement.

Direct sex discrimination

One of the things that makes discrimination such a difficult subject is that it requires the Tribunal to see into the mind of an employer to determine why particular actions were taken. But employers – particularly large employers – do not always act through a single person whose motivations can be examined. A number of people might contribute to a situation, which an employee claims to be discriminatory. In CLFIS v Reynolds the Court of Appeal held that when an employee was dismissed it was the mind of the individual manager making the decision to dismiss that had to be considered, rather than the motivations of others who may have been involved in the process. But that is not always a simple distinction to draw.

In Metropolitan Police v Denby, Chief Inspector Denby claimed that he was discriminated against on the grounds of his sex when he was subjected to a range of performance management and disciplinary actions, which hampered his prospects for promotion. The tribunal upheld the majority of his claims and the Metropolitan Police appealed.

A central issue in the appeal was that in relation to each act of discrimination found by the tribunal, a number of senior officers had been found to be involved in the decision making process. The Metropolitan Police argued that in each case the decision was actually taken by an officer who was ‘innocent’ of any discriminatory intent even if one or more of his or her colleagues had indeed had a discriminatory motive. The EAT rejected the appeal – finding that the tribunal had been careful to ensure that the actions of each decision-maker could properly be said to have been discriminatory. In reaching that conclusion the EAT agreed with counsel for CI Denby that the ruling in CLFIS v Reynolds should not be used to allow an employer to escape liability through deliberately opaque decision-making intended to mask the identity of the true discriminator.

And Finally…

It is of course untrue that hard work never hurt anyone – but in Spain it seems, hard work can also get you sacked. It has been reported that a manager was dismissed by a Spanish branch of Lidl for consistently arriving at work several hours early to prepare the store for opening. This contravened the company’s policy that employees should not work any unpaid overtime. It seems, however, that he had been coming in early for something like 12 years before his dismissal, which suggests that the policy was one that the company did not enforce too rigorously  – and his legal challenge is on-going. Of course, no one wants their employees to work so hard that their health is at risk, but it is difficult to imagine many British employers taking such a strong objection to an employee volunteering to work additional hours for free.

Employment Law Roundup – October 2017

October 9th, 2017

The unmistakable hints of Christmas that are appearing in shops are signaling that 2017 is nearing its close.

With next year just around the corner, employers are being urged to make preparations for one major shake-up that will take effect in May 2018. The General Data Protection Regulation (GDPR) looks set to change the way organisations handle personal data – whether by processing, storing, or disposing of that data. It’s an overhaul of our existing laws, and something that businesses of all sizes should be getting to grips with now.

The GDPR will introduce some enhanced versions of individuals’ rights already in play under the Data Protection Act, and there will be some new provisions too. And the Information Commissioner’s Office (ICO) has advised that now is a good time to check company procedures to make sure, among other things, that your systems would help you locate and delete relevant personal data if asked to do so.

Getting a good understanding of what the GDPR will mean for your business and for your employees is the essential first step, and one that should be taken without delay. Reviewing and updating your systems, policies, contracts, notices, and consents, will ensure that you are ready for the changes when they take effect.  Read the rest of this entry »

Employment Law Roundup – September 2017

September 4th, 2017

July and August may not have delivered the perfect summer. But, by way of silver lining, we have had some significant employment law developments.

One of these is the publication of the Taylor Review of Modern Working Practices, addressing many of the issues that have been bubbling away in workplaces since new models of working emerged and established themselves. The report talks about an overriding ambition: ‘All work in the UK economy should be fair and decent with realistic scope for development and fulfillment.’

Among its recommendations is the re-labelling of some workers as ‘dependent contractors’, with a clearer distinction between that category and the self-employed. The report also talks about gig economy workers and the National Minimum Wage, holiday pay for atypical workers, statutory sick pay, and tax.

We shall have to wait and see what comes of the proposals and whether any of our laws and practices will change as a consequence. Read the rest of this entry »

Employment Law Roundup – July 2017

July 4th, 2017

Love it or loathe it, the intensity of this summer’s spell of sunshine and high temperatures took many by surprise.

And let’s assume that summer is not over. Are you set up to handle yet more hot days, sunny rays, and a distracted workforce? Employers are expected to be ‘reasonable’. That might simply mean adjusting the air con or installing a set of fans. It might also mean relaxing your dress code to make workers feel more comfortable – something that needs careful thought so as to avoid problems around health and safety, your professional image, and discrimination.

It’s safe to say that the heat won’t last for very long. So, while it does, you’ll probably find that staff will appreciate a dash of empathy. And that doesn’t need to be at the expense of taking a firm approach where workers step out of line. The key is to be clear about what is expected, and about what the consequences of rule breaches might be. Read the rest of this entry »

Employment Law Roundup – June 2017

June 5th, 2017

We begin this bulletin with news of a must-have accessory in workplaces, and it’s of the canine variety.

According to the Guardian, around 8% of employers allow dogs at work. It’s an idea that seems to be taking off, perhaps with good reason. A survey last year by Banfield Pet Hospital revealed that more than 80% of employees feel a greater sense of loyalty to companies that are pet-friendly. Many believe that pets improve morale and reduce stress.

And did you know that June 23 is Bring Your Dog to Work Day? It might be calming; it might be carnage. But it’s a chance to test out the theory. Read the rest of this entry »