Schofield & Sweeney CIPD Presentation
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EMPLOYMENT LAW UPDATE 2011
Presented by
ALEX CLEMENTS and
JAMES AUSTIN
Headache 1: Issue
• How should the Widget Company manage Richard?
Headache 1: Relevant Law
• Default Retirement Age of 65 introduced in 2006 • ‘Heyday’ challenge by Age Concern• Reviewed in 2010 to ‘reflect the change in
economic circumstances’• Repealed on 6 April 2011• Transitional Provisions end 30 September 2011
Headache 1: Relevant Law
• The last date where the Default Retirement Age can operate is 5 October 2012
• Notice given on 5 April 2011 specifying intended retirement date of 5 April 2012
• Maximum six month extension agreed with new retirement date of 5 October 2012
• No longer a ‘potentially fair’ dismissal
Headache 1: Relevant Law?
End of compulsory retirement?
“These changes do not mean that individuals can no longer retire at 65 –
simply that the timing of retirement becomes a matter of choice rather than
compulsion”
Headache 1: Relevant Law
Workforce Planning• Concerns that even discussions about
retirement are discriminatory• Without prejudice conversations?• Consequences of not addressing performance &
capability issues with older workers• Disgruntled younger employees
Headache 1: Relevant Law
ACAS Guidance• Working without the default retirement age• Hold workplace discussions regularly - build into
appraisal system• Ask open questions about employees plans for
short, medium and long term future
Headache 1: Relevant Law
Employer Justified Retirement Age• Employers cannot retire employees at a set age
unless the age can be objectively justified – SOSR Dismissal
• “Proportional means of achieving a legitimate aim”
• Old regime justification included exceptional levels of mental or physical fitness
• Only employees• What is a legitimate aim?
– Prigge v Lufthansa
Headache 1: Relevant Law
Legitimate Aims:• Workforce planning• Protecting dignity of older employees – avoiding
performance management and fitness to work issues
• Protecting against incompetence• Having an age balanced workforce - promoting
the exchange of experience and innovation between ages
Headache 1: Relevant Law
• Capability is a potentially fair reason for dismissal– ‘relates to the capability or qualifications of the
employee for performing the work of the kind he was employed to do.’
Headache 1: Conclusion
• No default retirement age
• Unlikely to be a legitimate aim for imposing retirement
• Hold early and regular discussions
• Don’t make assumptions
• Use capability procedure
Headache 2: Issue
• Can Coalition impose the salary reduction on Ken?
Headache 2: Relevant Law
• Employer’s can amend terms and conditions through agreement
• If there is no agreement employer’s can dismiss employees and offer new contracts of employment
• Dismissal could be for “some other substantial reason”• S.98 (4) Employment Rights Act 1996:
– Taking into account the size and administrative resources of the employer did it act reasonably in treating it as sufficient reason for dismsisal
– Determined in accordance with equity and the substantial merits of the case
Headache 2: Relevant Law
• Garside and Laycock v Booth– B had been employed by G for 7 years– In 2009 due to a drop in sales and profits G
asked employees to take a 5% pay cut– G consulted staff then issued a voting paper– 2 employees refused change– G terminated contracts and issued new ones – B appealed unsuccessfully
Headache 2: Relevant Law
• Garside and Laycock v Booth– B claimed unfair dismissal– Tribunal found dismissal unfair:
• G hadn’t been in a desperate financial position and business reasons were not “cogent”
• B’s refusal of change was reasonable• G made poor attempt at consultation
– G appealed
Headache 2: Relevant Law
• Garside and Laycock v Booth– EAT overturned decision
• Change doesn’t need to be crucial to save business
• Question of reasonableness of employer’s decision• Did pay cut apply to all, including management?
– Where overwhelming majority of workforce accept change dismissal is likely to be fair
Headache 2: Issue
• Can Coalition impose the new contract on Vince? If so, does it still have to pay the £1,000?
Headache 2: Relevant Law
• Slade v TNT– TNT’s operating profits fell from £68.5m to £11.9m – TNT offered to buy out bonus– TNT warned if offer declined contracts would be
terminated and offers of re-engagement made– S claimed that offer of re-engagement must include
buy out in order for TNT to have acted reasonably– Tribunal found SOSR– EAT upheld decision – no duty to offer buy out
Headache 2: Conclusion
• Provided it follows the correct procedure Coalition should be able to:– impose salary reduction on Ken – remove bonus from Vince and his colleagues
• Coalition won’t have to pay Vince or the others £1,000
Headache 3: Issue
• What should Fortuna Fashions do for Rachel?
Headache 3: Relevant Law
• Obligation to make reasonable adjustments remains under the Equality Act
• Cost a factor in reasonableness
• How certain do you need to be the adjustment will help?
Headache 3: Relevant Law
• Cordell v FCO– C profoundly deaf and requires lip speakers– Posting withdrawn as support would cost in
excess of £300k pa– C pointed to costs of private education– C unsuccessful at tribunal & EAT– Schooling costs relevant not determinative– Look in context of overall budget
Headache 3: Relevant Law
• Foster v Leeds Teaching Hospital NHS Trust– F had to be moved from security department
because of stress– Would be reasonable adjustment to put him
on redeployment register– Does not need to be a good prospect, merely
some prospect at the date of the decision
Headache 3: Relevant Law
• Mylott v Tameside Hospital NHS Foundation Trust
• M dismissed on grounds of ill health• Claimed should have been able to apply for ill
health retirement• Adjustments are to help employees remain in
work, not to compensate them for losing a job.
Headache 3: Conclusion
• Consider the cost of reasonable adjustments – but remember it is not the only factor
• Give consideration to any adjustment even if it is not certain to help
• Remember adjustments are to help people back to work
Headache 4: Issue
• Can England Plc carry out a competitive interview process?
Headache 4: Relevant Law
• Morgan v The Welsh Rugby Union– National Elite Coach Development Manager and
Coach Education Manager roles made redundant– New role of National Coach Development Manager– Person spec included list of skills and attributes – Interview - Presentation then questions– Standard questions prepared and a scoring system
set out– Committee did not adhere to format for the interview
Headache 4: Relevant Law
• Morgan v The Welsh Rugby Union– Committee gave overall scores and appointed other
candidate – M claimed that if objective criteria followed he would
have got the job– Tribunal found the appointment fair
• No obvious bias
– EAT upheld decision• New role requires assessment of ability to carry out that role• Employer’s judgment
Headache 4: Issue
• Can England Plc refuse to make an enhanced payment if the redundant employee refuses to sign a compromise agreement?
Headache 4: Relevant Law
• Garratt v Mirror Group Newspapers– G was a photographer– Past practice of enhanced redundancy payments– Collective agreement stated enhanced redundancy
payment – 2 weeks’ basic pay per annum– G offered £80,000 subject to a compromise
agreement– G refused to sign – told he would receive £48,000
Headache 4: Relevant Law
• Garratt v Mirror Group Newspapers– No other employee had refused to sign– Tribunal found requirement to sign implied
into contract– EAT upheld decision
• Employees had always been required to sign• Employees knew of requirement• Employees had always received legal advice
Headache 4: Conclusion
• England Plc can carry out a competitive interview process where the successful applicant is chosen on basis of interview– It is preferable to have defined criteria which
applicants are assessed against
• England Plc can refuse to make an enhanced payment– Requirement to sign a compromise agreement can be
implied– Preferable to state such a requirement clearly
Headache 5: Issue
• How much protection should Dr Green have to defend his career?
Headache 5: Relevant Law
• Apply normal disciplinary rules to the case
• Is the sanction within the band of reasonable responses?
• What damage has been caused to colleagues and organisation?
• Would another sanction be appropriate?
Headache 5: Relevant Law
Legal representation at hearing
• Mattu v The University Hospitals of Coventry and Warwickshire NHS Trust– Art 6 of ECHR – right to have civil rights
determined before an impartial tribunal– Right to practice a profession a civil right– Right to a particular employment is not a civil
right
Headache 5: Conclusion
• Don’t treat social media offences any differently to other forms of misconduct
• Consider who can be a representative at hearings
• Is the offence likely to finish a career rather than just a job?
Headache 6: Issue
• Can Cerebral Juice dismiss Holly?
Headache 6: Relevant Law
• Bowater v N W London Hospitals– B was a staff nurse– At end of shift helped colleagues restrain a patient
having an epileptic fit– B climbed on to ankles to restrain patient– Patient’s trousers and underwear removed to
administer diazepam– Patient kicked B between legs causing her to land on
his genitals– B remarked "It's been a few months since I have been
in this position with a man underneath me"
Headache 6: Relevant Law
• Bowater v N W London Hospitals– Patient unaware of incident– B dismissed for gross misconduct for failing to:
• Restrain the patient appropriately• Promote dignity of patients• Uphold reputation of profession
– ET found dismissal unfair but 25% contribution• Most people would have found remark humorous
– EAT overturned decision– CA restored ET decision
Headache 6: Issue
• Is Holly under a duty to accept a role from Botox Selecta?
Headache 6: Relevant Law
• Debique v Ministry of Defence– D struggled to combine motherhood with
being a soldier– D successfully claimed unlawful indirect sex
and race discrimination– D received £15,000 for injury to feelings– No loss of earnings awarded as D refused
alternative role offered during notice period– EAT upheld decision
Headache 6: Issue
• Would Holly be able to bring a claim for sex and age discrimination if her replacement was an older man?
Headache 6: Relevant Law
• Burden of proof:– Employee must prove facts from which a tribunal
could conclude in the absence of an adequate explanation that the employer has unlawfully discriminated. This would include:
• Evidence of a difference in sex/age• Evidence of a difference in treatment• Evidence of the reason for the difference in
treatment– Employer must then prove it did not discriminate
Headache 6: Relevant Law
• Community Law Clinic Solicitors Ltd and ors v Methuen– M was an Asian man aged 54 – Dismissed after 5 months because failed to meet targets– Replaced by younger Afro-Caribbean woman who was
paid much less – M claimed dismissed on the grounds of age, sex and race– Respondent said department running at a loss and could
not afford M– ET at a PHR decided case had “little” prospect of success
• M failed to point to fact from which discrimination could be inferred• Not bound to fail• Deposit order
Headache 6: Relevant Law
• Community Law Clinic Solicitors Ltd and ors v Methuen– EAT disagreed
• M didn’t explain discrimination claim• Can’t base claim solely on being replaced
by someone with different protected characteristics
– EAT allowed age discrimination claim to proceed
Headache 6: Conclusion
• Cerebral Juice shouldn’t dismiss Holly depending on the investigation
• Holly is under a duty to consider an alternative job at Botox Selecta
• Being replaced by an older man should not be enough for Holly to bring discrimination claims
Headache 7: Issue
• Has Ross got any claims?
Headache 7: Relevant Law
• Redundancy selection and discrimination• Eversheds v De Belin
– Claimant scored lower than colleague in redundancy exercise
– Colleague been on maternity leave so given a notional score
– Maternity protection is only what is “reasonably necessary” – i.e. proportionate
– Other options available such as when both employees at work
Headache 7: Relevant Law
Can a reference be lawful if it seems unfair?• Jackson v Liverpool CC
– J applied for new job– Reference from Liverpool caveated that there
were record keeping issues– Made clear these had never been
investigated– CA – reference true and accurate even
though referred to matters which were untested
Headache 7: Conclusion
• Take maternity leave into account but don’t over compensate
• Take care with wording of references
• If possible, try to agree a reference before termination
Headache 8: Issue
• Is Michelle entitled to be paid for the overnight stays?
Headache 8: Relevant Law
• Wray v J W Lees & Co– W temporary pub manager required to stay on
premises overnight– W claimed pay for overnight hours – NMW
legislation– ET incorrectly looked at definition of working
time in Working Time Regs– EAT held W not working so not entitled to pay
Headache 8: Relevant Law
• Wray v J W Lees & Co– W free to leave the premises at any time– W’s position different to night watchman or night
sleeper in a residential home who had responsibilities throughout the night (South Manchester Abbeyfield v Hopkins)
– NMW Regulation 16:• Not working time if employee entitled to spend it at home• If employee is provided with accommodation at or near work
and is given time to sleep, such time is not working time unless the employee is required to work
Headache 8: Issue
• Has Tracy received the breaks she is entitled to under the Working Time Regulations?
Headache 8: Relevant Law
• Hughes v The Corps of Commissionaires Management Ltd– Reg. 12 of the WTR states employees entitled to 20
minute break after working more than 6 hours– Reg. 21 sets out exclusions where employer requires
permanent presence e.g.:• Security guards• Doctors• Dockers• Airports
– Reg. 24 states that where reg. 21 applies employer:• Must try to provide “equivalent period” of compensatory rest; or• Take other measures to safeguard health and safety
Headache 8: Relevant Law
• Hughes v The Corps of Commissionaires Management Ltd– H was a security guard– H could decide when to take breaks but could be
interrupted– H claimed he wasn’t receiving correct breaks– ET held:
• H wasn’t entitled to breaks but might be to compensatory rest• No practical way CCM could provide uninterrupted 20 minute
compensatory rest• CCM provided H with adequate health and safety protection
Headache 8: Relevant Law
• Hughes v The Corps of Commissionaires Management Ltd– EAT found the arrangements amounted to
providing a period of compensatory rest– CA upheld EAT’s decision:
• Compensatory rest didn’t have to be uninterrupted 20 minutes
– CA also held CCM provided adequate health and safety protection
Headache 8: Conclusion
• Michelle is not entitled to be paid for staying overnight
• Tracy may not be receiving the correct breaks. The position may be different if Tracy carried out a different type of work
Headache 9: Issue
• The rights of agency workers
Headache 9: Relevant Law
• The Agency Workers Regulations– In force 1 October 2011– Not retrospective
• Applies to:– Temporary agency workers– Those who supply temporary agency workers– Hirers
Headache 9: Relevant Law
Day One rights
• Access to collective facilities and amenities of hirer
• Canteen or other similar facilities• Child-care facilities• Provision of transport services
• Access to employment vacancies
• Liability for above on the hirer
Headache 9: Relevant Law
Continuity• Entitled to the same “basic working and
employment conditions” as if directly recruited by the hirer after 12 weeks
• Continuity broken and starts again when:– AW starts new assignment with new hirer– AW stays with same hirer but substantially
different role– Break of at least 6 weeks
Headache 9: Relevant Law
• Continuity not broken but weeks will not count where:– Break of less than 6 weeks– Break of up to 28 weeks where AW ill– Break where AW taking annual leave– Break caused by planned shutdown– Break caused by strike
• Continuity continues where break due to maternity, adoption or paternity leave
Headache 9: Relevant Law
12 week rights• “Relevant terms and conditions ordinarily
included” relating to:– Pay– Duration of working time– Rest periods– Rest breaks– Annual leave
• Liability can rest with agency or hirer– Agency has defence if it took “reasonable steps” to
obtain relevant information
Headache 9: Relevant Law
• Pay includes:– Basic pay– Overtime pay– Shift allowances– Bonuses/commission
• Where directly attributable to the TA
– Vouchers or stamps with monetary value
Headache 9: Relevant Law
• Pay excludes:– Occupational sick pay– Occupational pensions– Redundancy pay– Notice pay– Bonuses
• Not linked to contribution of individual
– Discretionary bonus payments– Majority of benefits in kind
Headache 9: Relevant Law
• Liability for breach:
• AW compensated for any loss– Minimum award of 2 week’s loss
• Potential fine of up to £5,000 if deliberately trying to avoid the Regulations
Headache 9: Relevant Law
• Employment status of Agency Workers
• BIS v Studders
• No employment contract where:– No evidence of intent to create an
employment relationship– No obligation to accept assignment– No obligation to offer work
Headache 9: Conclusion
• Supply information to an agency in good time
• Be careful when moving agency staff from one role to another
• Keep an eye on the length of assignments• Clarify which benefits fall within the
Regulations and which don’t• Check the terms of engagement with the
agency
Headache 10: Issue
• Can Wealthy City dismiss Carlo?
Headache 10: Relevant Law
• Orr v Milton Keynes Council– O was a part time youth worker– O discussed a sexual assault with kids at a
community centre despite manager Mr Madden
– 3 days later during discussion about working hours O was rude towards M
– O was dismissed after disciplinary hearing conducted by group manager
Headache 10: Relevant Law
• Orr v Milton Keynes Council– ET found
• O’s behaviour towards M sparked by M trying to reduce O's working hours without agreement
• When O began to use Jamaican patois M had committed direct race discrimination
• Dismissal fair and non-discriminatory because– Reasonable investigation– Reasonable response to what was known to the
dismissing officer at the time
Headache 10: Relevant Law
• Orr v Milton Keynes Council– EAT upheld decision
• ET’s should consider usual unfair dismissal test• Not enough for O to show but for discrimination
would not have been dismissed
– CA agreed• Only knowledge or state of mind of decision maker
is imported to employer• MK had carried out reasonable investigation• O was dismissed for 2 counts of gross misconduct
Headache 10: Conclusion
• Dismissal might not fall within band of reasonable responses depending on investigation
• If Wealthy don’t discover Mankini’s abuse dismissal may be fair
On the horizon
New Developments
National Minimum Wage
• From 1 October:– Workers aged 21+: £6.08– Workers aged 18-20: £4.98– Workers aged 16-17: £3.68
Reform
• 2 year qualifying period to claim unfair dismissal
• Having a cap on discrimination claims
• Introduce fees to commence proceedings
• Abolition of unfair dismissal?
www.schofieldsweeney.co.uk
Simon Shepherdsimonshepherd@schoeys.com
0113 220 6274
Alex Clementsalexclements@schoeys.com
0113 220 6280
James Austinjamesaustin@schoeys.com
0113 220 6275
Polly O’Malleypollyomalley@schoeys.com
0113 220 6341
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