In brief – December monthly round up

Welcome to the last bulletin of 2019. As well as providing a round-up of this month's developments, we also summarise the top 15 changes from this year looking at topics such as Brexit, immigration, holiday pay, the Senior Managers Certification regime and various key employment cases.

In our January bulletin, we will look ahead to what 2020 holds for employment law. In the meantime we wish you a peaceful Christmas and a Happy New Year.

If you would like to discuss any of the points raised, please get in touch.

In this bulletin:

  1. In the courts...recent case updates
  2. Legislation and consultations
  3. News

In the courts... recent case updates

Employers are still liable for unfair dismissal where the actual reason for dismissal is hidden from the decision-maker

In Royal Mail Group v Jhuti, the Supreme Court decided that employers are liable for automatically unfair dismissal where the dismissal derived from a protected disclosure regardless of whether the decision-maker was aware the employee had made protected disclosures.

The decision-maker was appointed and given information on Jhuti's poor performance by her line manager but was not given any information regarding the fact that the claimant had made a protected disclosure. After taking into consideration such information, the decision-maker, in good faith, decided that her employment would be terminated due to her failure to keep up the standard required of her.

The Supreme Court usually looks no further than the reasons provided by the decision-maker when identifying the reason for a dismissal. In this case however, as the real reason for dismissal was hidden from the decision-maker the courts had to go further and look behind the invented reason. The courts could do so providing that the person behind the invented reason was a part of the employer in the hierarchy of responsibility and sat above the dismissed employee.

Job evaluation study cannot be considered retrospectively to deprive employer of its material factor defence

In Co-operative Group Limited and another v Walker, an EAT held that an employment tribunal could not look for unlawful pay disparity in the period before a job evaluation study, which highlighted the pay disparity. The Employment Tribunal held that, between February 2014, when the employer could defend pay disparity allegations with a material factor defence and after February 2015 when the study was effective, the historical explanations were no longer material.

The EAT instead held that the defence would remain in effect until a new decision was made alleging sex discrimination due to the pay disparity, at which point the employer would need to make a new material defence.

Union interference with ballot leads to injunction preventing strike

The Communication Workers Union (CWU) encouraged its members that worked for Royal Mail to intercept delivery of their ballot papers to support a pre-Christmas strike against Royal Mail. Workers opened the papers at work and were told to vote yes which resulted in over 97% voting in favour of strike action.

Royal Mail was granted an interim injunction after they argued the ballot was unlawful under section 230 of TULCRA 1992 which provides that (amongst other things) voting must be carried out without interference and in secret, and the ballot paper be sent to a workers home address. The High Court granted the injunction due to findings that the CWU interfered with the voting which undermined the legal purpose of the act in ensuring members receive their papers at home. Video recordings of the mass posting also breached the act as voting was to be in secret.

CWU's appeal was dismissed by the Court of Appeal as it held that the CWU interfered with voting by encouraging ballot papers be intercepted and also failed to allow for the ballots to be sent to members' home addresses. Whilst the facts of this case is unlikely to be repeated, the case highlights itself as an example of what can amount to interference under the legislation.

In Jagex Ltd v McCambridge, the Claimant had been dismissed for gross misconduct after disclosing details that he had found relating to a senior employee's pay. After pointing the document out to a colleague, a 'guessing game' ensued whereby employees tried to guess the senior employee's pay.

Whilst the EAT upheld the tribunal's findings that the Claimant had not committed gross misconduct and that there should be no Polkey deduction, it considered that the tribunal should have considered a reduction for contributory fault. The test for such a reduction is whether the Claimant's conduct was blameworthy or culpable; it was not necessary for the Claimant to have committed gross misconduct in order for a reduction to compensation to be made in respect of contributory fault.

Non-payment of 'London Allowance': direct sex discrimination

The EAT held that failing to pay a 'London Allowance' to a police officer on maternity leave constituted direct sex discrimination in City of London Police v Geldart. The allowance is separate from salary and 'London weighting'. The City of London Police stopped paying her the allowance at the time that her maternity pay stopped.

The EAT ruled that the Police Regulations did not provide for the 'London Allowance' to cease during maternity leave. Therefore, failing to make the payments amounted to direct sex discrimination. Following Webb v EMO Air Cargo, the EAT confirmed that it is not necessary to prove that a male comparator would have been treated differently in the context of detriment on account of pregnancy/maternity.

Substitution clauses and worker status

In Stuart Delivery Ltd v Augustine, the EAT held that a substitution clause in a service contract did not preclude the individual from being classified as a "worker".

The individual was a delivery courier who worked 'slots', typically three hours in duration, during which time he was under the control of Stuart Delivery Ltd. There was an obligation to perform the deliveries offered to him in return for a guaranteed hourly wage; he was not permitted to leave the zone that he was operating in.

Mr Augustine had the ability to release a 'slot' that he had agreed to undertake back into a pool of agreed couriers. The EAT upheld a tribunal's finding that this did not amount to a right of substitution. His obligation to provide work remained unless another courier signed up for it, which Mr Augustine had no control over. The arrangement, therefore, did not deny him worker status.

Legislation and consultations

Directive on whistleblowing to enter into force

Directive (EU) 2019/1937 is intended to harmonise whistleblower protection across the EU. It follows high-profile scandals that demonstrated the importance of whistleblowers in bringing unlawful activities to light, such as the Cambridge Analytica revelations and the Panama Papers.

The Directive was published in the Official Journal on 26 November 2019 and came into force on 16 December 2019. It offers protection to persons who report breaches of EU law. Member states have until 17 December 2021 to enact the legislation and administrative provisions required to comply with the Directive. By 17 December 2023, member states will enact the provisions necessary to meet its obligation to establish internal reporting channels under Article 8(3); this will affect organisations in the private sector with 50 to 249 workers. On the basis of the UK being likely to leave the EU at the end of January, we will have to see if similar legislation is replicated in the UK.


Dismissing employee for publishing blog posts is a violation of the right to freedom of expression

An HR manager of a bank was dismissed after his employer came across two blog posts he posted in relation to HR strategy and taxes. The website on which the posts were published included the claimant describing himself as an expert in HR management who worked at a large bank without using his name.

The claimant's employer argued that the claimants conduct damaged its economic interests and violated confidentiality. The Hungarian Supreme Court upheld the employer's decision to dismiss stating that the employee's conduct could have damaged the banks economic interests and breaching confidentiality by sharing confidential information. The claimant maintained that his employer's decision to dismiss interfered with his freedom of expression under Article 10 of the European Convention on Human Rights (ECtHR).

However, after examining the approach that the Hungarian Supreme Court took to analyse the restriction of free speech, the European Courts of Human Rights held that there had been a violation of Article 10. The Hungarian courts failed give proper consideration to the balancing exercise of the individual's rights under Article 10 and the employer's right to protect its economic interests. It was found that the Hungarian Courts did not discharge their positive obligations under Article 10 to protect the right to freedom of expression in the sphere of relations between private individuals.

PENP guidance amendments for employees paid by equal monthly instalments

HMRC has published an alternative formula to calculate post-employment notice pay (PENP) as the standard formula resulted in different figures depending on when in the year notice was given (concession).

The change relates to P in the PENP formula being 30.42 rather than the actual number of days in the pay period, as long as it is beneficial to the employee and conditions are met. As the third condition required notice to be stated as a whole number of days or weeks, it was unclear whether the concession applied, should the notice be expressed in months, but where the employee worked part of their notice resulting in the unworked period of notice being expressed as a period of days or weeks.

HMRC accepted that the conditions in relation to the concession were restrictive. From 16 October 2019, the third condition has been deleted and replaced with: "the post-employment notice period is not a whole number of months" which removes the uncertainty in determining the concession.