Welcome to June's In Brief employment law update.
To help you keep quickly up to date with employment law, we summarise the key developments arising from cases, legislation and consultations for this month.
In this bulletin:
In the courts... recent case updates
In the recent decision of Phoenix House v Stockman an employer argued that an employee's covert recording of a meeting with HR was in breach of the implied term of trust and confidence and that compensation for unfair dismissal should have been reduced to nil under 'just and equitable' grounds as a result.
However, the Employment Appeal Tribunal (EAT) dismissed this appeal and stated that it could not be said that the covert recording of a meeting necessarily undermines the relationship of mutual trust and confidence. There can be a variety of reasons for such recordings, such as to obtain legal advice or keep a record. An employment tribunal (ET) must make an assessment of the circumstances, including identifying the purpose of the recording and what is being recorded.
The EAT also decided that it is good practice for parties to confirm an intention to record a meeting, except in the most pressing of circumstances, and a failure to do so would generally amount to misconduct. The EAT however felt that a failure to do so would not usually amount to gross misconduct and that the facts and circumstances of each case would need to be taken into account. Employers may want to review their list of examples of gross misconduct and expressly include this.
However, in this case the claimant only recorded one meeting which related to her own position and employment rather than trying to entrap or record confidential information. The EAT felt in this case that there was no need to alter the initial decision that the compensation should be reduced by 10%.
Constructive knowledge of disability
In the case of A Ltd v Z, the EAT considered whether the respondent had constructive knowledge of the claimant's disability when the claimant had tried to conceal it.
The claimant suffered from mental health and psychiatric impairments, which meant that during her employment with the respondent, she had a very poor attendance record. The respondent was aware that she suffered from stress due to personal problems but dismissed her on the grounds of poor attendance and timekeeping.
The ET decided that the respondent had no actual knowledge of the claimant's disability but should have made more enquiries into the position and therefore had constructive knowledge. The ET found that as the respondent was aware that its employee had personal problems and knew that she suffered from stress, it should have done more to look into the background, for example by requesting detailed references and making further enquiries.
Ultimately the claimant's claim failed, however, as the EAT decided that even if the respondent had made further enquiries, the claimant would have continued to hide the true facts and full extent of her mental health condition and therefore these enquires would have made no difference. Accordingly, it was held that the respondent could not have constructive knowledge and the claimant lost the protection against disability discrimination under the Equality Act 2010.
Reinstatement and re-engagement
The Court of Appeal has ruled that even where there is an ET order for re-engagement, the court has no power to enforce it if an employer chooses not to obey it.
In the case of MacKenzie v University of Cambridge, the respondent dismissed the claimant unfairly and following an ET hearing, it was decided that the claimant should be re-engaged. The respondent refused to comply with the re-engagement order, and instead paid the claimant the maximum amount that the ET could have awarded her.
The claimant appealed to the Court of Appeal via a judicial review, claiming that the respondent had not complied with the order to re-engage. However the Court of Appeal dismissed her claim. Instead it held that an employee does not actually have the right to be re-engaged, and other than an additional award being paid, which the respondent had done in this case, there is no other remedy where an employer refuses to re-engage.
The EAT held that an NHS Trust did not discriminate when dismissing a non-executive director on religious grounds.
In the case of Page v NHS Trust Development Authority, the claimant, a practising Christian, claimed that he had been directly and indirectly discriminated against after he was dismissed for speaking out in public against homosexuality and same-sex couple adoptions.
The claimant had previously been disciplined for his views whilst he was working in his capacity as a lay magistrate sitting in the family court. Following this he gave an interview on the radio and also to a newspaper. The claimant did not inform the trust of the disciplinary action – however, they received a complaint which led them to investigate further.
The claimant was removed as a magistrate and gave further interviews to the media outlining his comments and belief about homosexuality. The trust decided not to re-appoint the claimant based on his public comments and the negative impact on staff and patients in the NHS.
The claimant began proceedings claiming that he had been dismissed due to his religious beliefs. The ET dismissed these claims on the basis that he was not dismissed due to his views, but rather because he spoke to the media without informing the trust, which he was required to do.
Upon appeal, the EAT upheld the ET's decision, confirming that there had not been direct discrimination nor indirect discrimination as a group disadvantage was not shown.
The EAT further stated that the claimant was not dismissed because of his beliefs but the fact that he continued to ignore the trust's request for him to not contact the media without its permission.
Social media and vicarious liability
In the case of Forbes v LHR Airport Limited, the EAT has recently held that posting an offensive image to Facebook whilst not at work was not carried out in the course of employment and consequently an employer was not vicariously liable.
In this case, the claimant was a security officer at Heathrow Airport. According to the judgment, 'a colleague of the Appellant, Ms S, posted an image of a golliwog on her private Facebook page with the caption, “Let’s see how far he can travel before Facebook takes him off".' outside of working hours and from a personal device.
Upon being shown the image by a further colleague, the claimant complained of harassment by Ms Stevens. Ms Stevens apologised and received a final written warning.
However, the claimant raised a further concern after being rostered to work alongside Ms Stevens and was therefore re-located. The claimant then took a period of sickness and began proceedings in the ET in relation to alleged harassment, victimisation and discrimination.
The ET found in favour of the respondent, deciding that Ms Stevens did not share the image in the course of employment and therefore the respondent could not be liable. The claimant appealed.
Dismissing the appeal, the EAT determined that whether or not an act is in the course of employment is a question of fact for the ET to determine. In this case, the fact that the image was shared outside of work hours, on a private device, and to a group of Facebook friends, one of whom happened to show the claimant illustrated that the act was not done in the course of employment.
However, the EAT highlighted that the outcome may well have been different had the image been shared directly with the claimant or if the claimant had brought a harassment complaint against the colleague who showed him the image during working hours.
Justification of age discrimination
The EAT in Heskett v Secretary of State for Justice considered whether discriminatory changes made by the respondent to a policy which would limit pay across the public sector as a result of budgetary constraints could be justified.
Following funding cuts imposed by central government, the Ministry of Justice made a number of changes including limiting the rate at which certain probation officers could progress to the top of an incremental salary scale.
The first-tier ET found that the changes were clearly discriminatory as they favoured older employees but that, in consideration of all of the circumstances, they were justified. The claimant appealed.
Dismissing the appeal, the EAT agreed with the ET and held that the respondent was justified as it was a legitimate aim to attempt to break even year on year by deciding on the allocation of resources. This was not simply a 'costs alone' case. Here, the EAT highlighted that there is a clear distinction between a respondent seeking to rely solely on costs arguments in justifying limiting pay and simply an absence of means. However, whether this can be relied on as a justification will depend on the facts and employers are recommended to seek specific legal advice.
Minimum wage records and TUPE transfers
Under s9 of the National Minimum Wage Act 1998 (NMW) employers must keep pay records even where an employee’s employment has ceased. Workers may serve a production notice on their employer to require them to produce such records if they reasonably believe they’ve been paid less than the minimum wage.
In Mears Homecare Ltd v Bradburn, there had been a transfer under the Transfer of Undertakings (Protection of Employment) regulations ("TUPE") from Mears Homecare Ltd (MH). Ms Bradburn served "production notices" on the transferor, MH, seeking pay information which was not responded to. Consequently, Ms Bradburn and others brought an ET claim against MH. Upholding their claim, the ET ordered MH to pay £600 to each of the claimants, which was 80 times the NMW rate then in force as mandated by the legislation. MH appealed.
Upholding the appeal, the EAT held that under TUPE, employment continues with the transferee and therefore does not cease under NMW, with the liability regarding keeping and producing relevant pay records also passing to the transferee. MH's obligation to maintain or produce such records therefore ceased.
It should be noted, however, that there is no reason why, as part of the TUPE arrangements, a transferee shouldn't impose an obligation on the transferor to provide all records kept for the purposes of NMW. Indemnities in the transfer may also be used to shield the transferee from potential future liability.
Agency workers not entitled to same number of contractual hours as a directly-recruited comparator
In Kocur v Angard Staffing Solutions Ltd and another, the Court of Appeal has upheld an employment tribunal's decision that the Agency Workers Regulations 2010 do not entitle agency workers to work the same number of contractual hours as a directly-recruited employee comparator.
The court reached its decision based on the purpose of the legislation as well as the language used and decided that there was nothing to suggest that the regulations were intended to regulate the amount of work that agency workers were entitled to.
The court was also mindful of the fact that to do otherwise in this case would be contrary to the purpose of using agency workers, namely to allow workforce flexibility.
Legislation and consultations
Sexual harassment in the workplace
The Government Equalities Office launched a consultation on 11 July 2019 with the aim of tackling sexual harassment in the workplace. The Government is looking at the current laws, including the Equality Act 2010 and will decide whether or not they provide the correct protections to workers and whether there are any gaps.
The consultation, which will close on 2 October 2019, is seeking views on the following:
- How best to make sure employers take all the steps they can to prevent harassment from happening
- Strengthening and clarifying the law so it’s clear employers should protect their staff from being harassed by clients, customers, or other people from outside their organisation
- Whether interns and volunteers are adequately protected by current laws
- Whether people should have longer to take a harassment, discrimination or victimisation claim to an ET
The result of the consultation will affect many employers and possibly change the way that they deal with sexual harassment in their organisations.
Bill aligning NICs and income tax on termination payments and sporting testimonials receives Royal Assent
The National Insurance Contributions (Termination Awards and Sporting Testimonials) Bill has passed through the House of Lords without amendment and received Royal Assent on 24 July 2019, becoming the National Insurance Contributions (Termination Awards and Sporting Testimonials) Act 2019.
For a review of the changes, please see our May Bulletin, which reported on the first reading of the bill.
Transparent and predictable working conditions
The Directive (EU) 2019/1152 on Transparent and Predictable Working Conditions has now been published. The directive will give workers new and enhanced rights, especially in relation to more precarious jobs as it will make working conditions across the EU more transparent and predictable.
Under the directive, all workers in the EU will have the right to the following:
- more complete information on the essential aspects of the work, to be received early by the worker, in writing
- a limit to the length of probationary periods at the beginning of the job
- seek additional employment, with a ban on exclusivity clauses and limits on incompatibility clauses
- know a reasonable period in advance when work will take place, for workers with very unpredictable working schedules, as in the case if on-demand work
- anti-abuse legislation for zero hour contract work
- receive a written reply to a request to transfer to another more secure job
- receive cost-free the mandatory training that the employer has a duty to provide
The directive will cover all workers, including zero-hour contracts, casual work and domestic work, although some provisions will exclude certain groups.
EU member states have until 1 August 2020 to transpose the directive into their national law.
Gender equality roadmap launched
The Government Equalities Office has published "Gender equality at every stage: a roadmap for change". Notable proposals include:
- consulting on strengthening measures to tackle sexual harassment
- consulting on a new right to carers' leave
- reviewing the enforcement of equal pay legislation
- considering the effectiveness of gender pay gap reporting.
The shared parental leave and pay scheme is targeted to be completed the end of 2019, after which the government will consider whether to modernise the existing system.
Good Work Plan: consultation on single enforcement body
The Department for Business, Energy and Industrial Strategy (BEIS) has published a consultation on the proposal to create a single enforcement body for employment rights. The proposal was made in the Government's Good Work Plan policy paper published in December 2018.
The consultation seeks views on whether a new body should have a role in enforcing rights in relation to statutory sick pay, supporting the Equality and Human Rights Commission and a role in enforcing unpaid tribunal awards. It also considers extending the civil penalties regime used to enforce payment of the national minimum wage to other areas in which the current enforcement bodies can require businesses to comply with certain aspects of pay. Views are also sought on transparency in supply chains and enforcing joint responsibility for labour market breaches. The consultation closes on 6 October 2019.
Announcement on settled status from Boris Johnson
Despite calls for new legislation to be introduced to protect the rights and status of EU citizens living in the UK in the event of a no-deal Brexit, Boris Johnson has angered even his own MPs in confirming that he currently has no plans to introduce any such legislation. Mr Johnson has assured EU citizens that they will have "the absolute certainty of the right to live and remain in the UK" but has stopped short of proposing legislation, considering the current Home Office 'settled status' scheme to be sufficient to guarantee EU citizens' rights.
It will be interesting to see how Mr Johnson deals with the backlash; it has been suggested that one reason for not introducing such legislation is that it could be hi-jacked by anti-Brexit MPs looking to block a no-deal Brexit, however other MPs have stated that they will only support a no-deal Brexit when EU citizen's rights are properly protected. Until such time as a further announcement is made confirming the new Prime Minister's intentions, the position for EU citizens remains as set out in our previous article, found here.