Employment Seminar
The Employment Department held an Employment Law Update Seminar in December which provided a summary of the key developments in employment law in 2006. The topics covered included:
- Transfer of Undertakings
- Age Discrimination
- National Minimum Wage
- Changes to maternity and paternity leave
- Harassment
- Important case law
Below is a brief synopsis of the seminar material. If you would like further information, please contact Bethan Southcombe on 0117 945 3084 or e-mail employment@metcalfes.co.uk
Transfer of Undertakings
The Transfer of Undertakings (Protection of Employment) Regulations 2006 ("TUPE Regulations") came into force on the 6th April 2006.
The aim of the TUPE Regulations is to provide employment rights to employees' when their employer changes as a result of a transfer of an undertaking. TUPE was introduced to protect the continuity of employment and to preserve terms and conditions of employment on a change of employer. When the employer changes identity, the employee's job is protected, as well as past service.
TUPE applies where there is a relevant transfer from one party (The Seller) to another (The Buyer), but employees must have at least 12 months continuous service before they can make a complaint of unfair dismissal for a TUPE related reason (unless they are asserting their rights under TUPE and are dismissed).
Summary Of The Key Elements Of Tupe
Where there is a relevant transfer the employees are automatically transferred from the transferor to the transferee on the same terms and conditions of employment; any dismissal by the employer in connection with the transfer is automatically unfair (unless there is an ETO reason). The transferor must provide certain employee information to the transferee and both transferor and transferee must inform and consult with employee representatives.
The regulations can apply regardless of size.
The main changes that the 2006 TUPE Regulations introduced are:
- A widening of the scope of the Regulations to cover cases where services are outsourced, insourced or assigned by a client to a new contractor (described as "service provision changes")
- A new duty on the old transferor/employer to supply information about the transferring employee to the new transferee employer (by providing what is described as "employee" liability information")
- Special provisions making it easier for insolvent businesses to be transferred to new employers;
- Provisions which clarify the ability of employers and employees to agree to vary contracts of employment in circumstances where a relevant transfer occurs;
- Provisions which clarify the circumstances under which it is unfair for employers to dismiss employees for reasons connected with a relevant transfer.
Employment Equality (Age) Regulations 2006
The Employment Equality (Age) Regulations 2006 ("the Regulations") was implemented on the 1st October 2006. The Regulations make it unlawful to discriminate against workers, employees, job seekers and trainees because of their age. Workers often undertake roles similar to employees but do not have contracts of employment.
To whom do the Regulations apply?
The Regulations apply to all employers, private and public sector vocational training providers, trade unions, professional organisations and trustees and managers of occupational pension schemes.
The Regulations cover:
- Recruitment
- Terms and conditions
- Promotions
- Transfers
- Dismissals
- Training
They do not cover:
- Provision of goods and services
The Regulations make it unlawful on grounds of age to:
- Discriminate directly against anyone
- Discriminate indirectly against anyone
- Subject someone to harassment
- Victimise someone because they have made or intend to make a complaint
- Discriminate against someone in certain circumstances after the working relationship has ended
National Minimum Wage
The National Minimum Wage Act 1998 ("NMW") was introduced by the Government with the aim of providing employees with decent minimum standards and fairness in the workplace.
The NMW applies to nearly all workers and sets hourly rates below which pay must not be allowed to fall. The rates set are based on the recommendations of the independent Low Pay Commission.
The NMW increases on the 1st October each year. The current figures are as follows:
The rate of the accommodation offset increased to £29.05 per week (£4.15 per day) from £27.30 per week (£3.90 per day).
As from the 1st October 2006, the Employment Equality (Age) Regulations abolished the Older Workers Development Rate and removed the age limit on the apprenticeship exemption.
Changes To Maternity And Paternity Leave
The 1st October 2006 saw the introduction of new legislation which affects maternity and paternity leave. The Work and Families Act 2006 will:
- extend maternity and adoption pay from six to nine months from April 2007, towards the goal of a year's paid leave by the end of the Parliament;
- extend the right to request flexible working to carers of adults from April 2007;
- give employed fathers a new right to up to 26 weeks Additional Paternity Leave some of which could be paid, if the mother returns to work after six months but before the end of her maternity leave period. This will be introduced alongside the extension of maternity pay to 12 months;
- introduce measures to help employers manage the administration of leave and pay and plan ahead with greater certainty from April 2007; and
- help employers and employees benefit from improved communication during maternity leave.
Harassment & Occupational Stress
"Many, alas, suffer breakdowns and depressive illnesses and a significant proportion could doubtless subscribe some at least of their problems to the strains and stresses of their work situation: be it simply overworking, the tension of difficult relationships, career prospect worries, fears or feelings of discrimination or harassment, to take just some examples. Unless, however, there was a real risk of breakdown which the Claimant's employers ought to reasonably have foreseen, and they ought properly to have averted - there can be no liability".
This statement from Simon Brown, Lord Justice in Garrett v Camden [2000] - set out the relevant legal test to be applied by the Court when considering a common law action in negligence.
The Court of Appeal has provided guidance on the relevant principles when considering claims in Occupational Stress - Barber v Somerset County Council [2004]
There is a three year limitation period in which a Claimant must issue Court proceedings.
Bullying - claims under the Protection from Harassment Act 1997
The Court of Appeal has opened up a new line of attack for employees bullied or intimidated at work. It has been decided by a 2 - 1 majority that an employer can be vicariously liable for the actions committed by an employee in the course of their employment. (Majrowski v guy's & St Thomas's NHS Trust [2006])
For a Claimant, the advantages of the 1997 Act include:
- The absence of a definition of harassment;
- A limitation period of 6 years.
- Damages for anxiety falling short of identifiable injury to health can be recovered as can any financial loss resulting. Such compensation cannot be recovered in a wrongful dismissal claim or an unfair dismissal claim or a personal injury claim.
- It gets even worse for employers. The mandatory insurance cover required for the employer's liability (Compulsory Insurance) Act 1969 only applies to bodily injury or disease. Claims for mere anxiety will therefore not be covered.
Important Case Law
NTL Group Ltd v Difolco - Reasonable Adjustments on Redundancy
Mrs Difolco, who was partially paralysed and could only work part-time, was made redundant. She was offered the chance to apply for another job as being suitable alternative employment. This other job was advertised on a full-time basis but she was told that (should she be appointed) the employer would consider changing the role to part-time. However, she refused to apply unless the job was changed to part-time before she applied.
She claimed that by failing to convert the job to part-time, the employer had failed to make reasonable adjustments.
The Court of Appeal, disagreeing with the EAT, held that this could not amount to a failure to make reasonable adjustments. Until Mrs Difolco had applied for the job, no duty to make reasonable adjustments arose. As Laws LJ said: "If the mere fact of advertising for a full-time job can constitute an 'arrangement' for the purposes of the DDA then on the face of it would potentially discrimination against the whole innominate class of possible disabled applicants for the job. That, it may well be thought, would be a reductio ad absurdum."
O'Hanlon v Commissioners for HM Revenue and Customs
EAT case. An employer was not obliged to amend its sick pay policy to give a disabled employee on disability-related sick leave full pay as part of its duty to make reasonable adjustments. Furthermore, although the tribunal's decision that there was no less favourable treatment in the policy's application to the claimant was incorrect, such treatment was in any event justified.
Azmi v Kirklees Metropolitan Council - 'No veil policy' was justified
In this case, a female Muslim teaching assistant claimed that she had been less favourably treated on the ground of her religion by the employer's requirement that she remove her veil while teaching.
It was held that she was not subjected to direct discrimination on the ground of religion or belief by a requirement that she removed her veil while teaching. Nor did the policy constitute indirect discrimination because, although it was a provision, criterion or practice that put her at a disadvantage compared to others not of her belief, it was a proportionate response to the legitimate aim of providing unhindered language tuition to young children.
The complaint of harassment was dismissed, as the tribunal found that the Claimant had exaggerated the subjective effect of the treatment complained of. However, the victimisation claim was upheld. There had been a marked change in the Respondent's attitude towards the Claimant since it became aware that she had contacted ACAS for advice and written a letter to her MP. The Respondent's complete inaction with regard to the grievance was of particular concern to the tribunal, which held that the only reason for it could have been the fact of the Claimant's complaint of religion discrimination.
The claimant was therefore awarded £1,000 for injury to feelings, increased by 10 per cent to £1,100 under S.31 of the Employment Act 2002 to reflect the Respondent's failure to complete an applicable statutory grievance procedure.
Scott-Davies v Redgate Medical Services
The EAT held that there is no free-standing right to bring a claim before a tribunal for breach of the statutory procedures.
In this case, the Claimant lacked the one-year qualifying period for claiming unfair dismissal. However, he argued that he could bring a claim for breach of the statutory dismissal procedure as contained in the Employment Act 2002.
The EAT upheld the tribunal's decision to strike out the Claimant's claim.
Royal Bank of Scotland v McAdie - an employer responsible for its employee's incapability may still dismiss fairly
In Royal Bank of Scotland v McAdie the EAT held that an employer could fairly dismiss an employee for ill-health capability despite the fact that the employee's stress-related illness was attributed to the conduct of the employer. However, the cause of the employee's capability is a relevant factor for the tribunal to consider when determining whether or not a dismissal is fair.
Commissioners for the Inland Revenue v Ainsworth - Holiday Pay for long-term sick Workers
In April 2005, the Court of Appeal held that the right to four weeks' statutory paid holiday under the Working Time Regulations 1998 does not continue to accrue whilst an employee is off on long-term sick-leave. The employees however appealed to the House of Lords.
The case is now being heard under the name of HMRC v Stringer.
The House of Lords has remitted the issue to the European Court of Justice. The precise wording of the questions to be put to the ECJ is still under consideration and it is understood that is likely to be finalised shortly.
So, watch this space.
Commission v UK - Rest Periods
The UK Government's transposition into domestic law of the daily and weekly rest period provisions of the Working Time Directive was inadequate in so far as guidance issued by the DTI advised employers that they were not obliged to ensure that workers took the breaks to which they were entitled.
So, UK legislation and associated guidance provides that employees can take rest periods but does impose a duty to ensure that they in fact do take them.
E MacCartney v Oversley House Management
This was an EAT case that was heard at in December 2005. It was held that a worker who was required by her employer to remain on call and for that purpose to remain close to her place of work was "working" while on call for the purposes of the Working Time Regulations 1998 despite being provided with accommodation at her workplace.
Clarke v Frank Staddon Ltd
This case concerns rolled-up holiday and it has been remitted to the employment tribunal following ECJ ruling.
Following an ECJ ruling that rolled-up holiday pay is unlawful under the Working Time Directive, the Court of Appeal has remitted the case to a tribunal for a re-hearing. The employer was also ordered to pay the worker's costs in the ECJ and Court of Appeal. The Court's judgment was very short and did not give any guidance to the tribunal on how it should interpret the "set-off" provisions of the ECJ's decision. We must therefore wait for further clarity on this issue.
Adeneler v Ellinikos Organismos Galaktos
From 10 July 2006, employees who have been employed on two or more successive fixed-term contract for a period of four or more years will be deemed to be permanent employees unless the continued use of fixed-term contracts can be objectively justified.
In this case the ECJ states that "objective reasons" refers to "precise and concrete circumstances characterising a given activity, which are therefore capable in that particular context of justifying the use of successive fixed term contracts…"
McMenemy v Capita Business Services Ltd
EAT held that a part-time employee, who did not work on Mondays (on which at least 4 of the 8 British public-holidays fall) was not entitled to rely on the Part-Time Worker Regulations to claim additional time off pro-rata, as a full-time worker who did not work on Mondays would have been treated the same way.
Fraser v Hlmad Ltd
CA held that Claimants' who bring wrongful dismissal claims in the employment tribunal, where the statutory limit on damages is £25,000, cannot recover the remainder in the High Court. Therefore claimants may be best advised to consider pursuing unfair dismissal in the employment tribunal and wrongful dismissal in the High Court.
Contact
Judith Ellery Head of Employment
Bethan Southcombe Solicitor