1. Skip to navigation
  2. Skip to content
  3. Skip to sidebar

We need a holiday from the holiday pay cases!

In the latest in a number of cases dealing with the calculation of holiday pay, the Employment Appeal Tribunal (“EAT“) has held, in the case of Dudley Metropolitan Borough Council –v- Willetts, that pay for voluntary overtime normally worked constitutes “normal remuneration” for the purposes of calculating holiday pay provided for in the Working Time Directive (20 days).

The EAT rejected Dudley Council’s restrictive interpretation of the recent seminal cases of Williams and Lock. Dudley Council sought to argue that these cases demonstrated that the overtime payments were not “normal remuneration” because they were not intrinsically linked to the performance of the tasks the Claimants in this case were required to carry out under their employment contracts. The EAT found that this link did exist since the Claimants were performing the same tasks when they worked overtime as they did when performing their usual duties.

In reaching its decision, the EAT considered what it called “the overriding principal of EU case-law”, this being that normal remuneration must be maintained so that pay in respect of annual leave corresponds to remuneration while working. To not include this voluntary, but frequent, overtime in the calculation of holiday pay would be to potentially deter a worker from taking annual leave – which is exactly what the legislation (and the case law flowing from it) is intended to prevent. It seems therefore that the reverse is the case. Not only must taking holiday not be detrimental to an employee but it may, in fact, result in a windfall since, had the employees not been on annual leave, they may have chosen not to work the overtime in any event. It remains to be seen, however, how frequently overtime has to be worked before it becomes “normally worked”.

The full case report can be found here:  http://www.bailii.org/uk/cases/UKEAT/2017/0334_16_3107.html

 

 

We need a holiday from the holiday pay cases!

Assuming the best…

In the recent case of Elmore v Darland High School, the Employment Appeal Tribunal upheld a Tribunal’s determination that a dismissal was fair, despite the fact that the appeal panel did not give any reasons for dismissing the Claimant’s appeal and none of the appeal panel gave evidence before the Tribunal. The Tribunal held that, in the absence of such evidence or express reasoning, it was entitled to infer that the appeal panel had upheld the capability dismissal for the same reason as the original capability panel. A somewhat surprising decision, particularly given that the Claimant, a maths teacher, had been employed by Darland High School for over a decade.

Assuming the best…

SOSR – A low threshold for a fair dismissal?

Of the five fair reasons for dismissal, ‘some other substantial reason’ (SOSR) is often viewed as a ‘catch all’ justification for dismissal. It does not give an employer freedom to dismiss for an irrelevant or trivial reason. However, the threshold to meet in order to be able to rely on an SOSR dismissal appears not to be prohibitively high in light of the recent case of Ssekisonge v Barts Health NHS Trust UKEAT/0133/16/LA.
Ms Ssekisonge was a registered nurse who worked for a number of NHS Trusts. She came to the UK and obtained indefinite leave to remain and then British citizenship. Her citizenship was revoked when the Home Office had concerns regarding her identity. Ms Ssekisonge did, however, retain her leave to remain. Following a disciplinary process, the NHS dismissed her, again due to concerns over her identity.
The Employment Tribunal found the principal reason for the dismissal was that the NHS could not determine Ms Ssekisonge’s identity and the risk that this posed was sufficient to justify her dismissal for SOSR. Ms Ssekisonge appealed the decision but the Employment Appeal Tribunal (EAT) upheld the first instance decision. Certainty over an employee’s identity was essential for a nursing role. The EAT rejected an argument that employers should go further than they might otherwise do when dismissing for SOSR where there is no fault on the part of the employee.
It is important to remember each case is fact sensitive. In particular the claimant in this case was waiting for the outcome of the Home Office investigation in relation to her identity and the NHS Trust was not expected to investigate further in the meantime. Employers should also be aware of their duties to check a job applicant’s ‘right to work’ documents.

SOSR – A low threshold for a fair dismissal?

The proposed shake up of Employment Tribunals

Digital claims, the delegation of authority to caseworkers and a tailored composition of tribunal panels are just three of the proposed reforms to Employment Tribunals.

On 23 February 2017, the government published its response to the MoJ and BEIS’s joint consultation aimed at simplifying and speeding up the resolution of disputes. The consultation forms part of a wider initiative to review the entire civil justice system.

The government confirmed its commitment to the digitisation of claims, recognising that claims should be made and processed online. Depending on the nature and complexity of the claim, some cases would also be suitable for online decisions. Recognising the inevitable risks of new IT systems creating unforeseen problems, the reforms will take place over several years and digital transformation will be the latter part of the programme.

The government also recognised the importance of providing procedural flexibility to meet future challenges by supporting the delegation of tasks to tribunal caseworkers who would be legally “trained or qualified”. Noting the concerns raised around ensuring that only those matters suitable for delegation are, in fact, delegated, the government expects that any delegation implemented would follow further engagement between the Senior President of Tribunals, the Employment Tribunal judiciary and Tribunal users.

The government also intends to proceed with its proposal for the Senior President of the Tribunals to have responsibility for deciding the panel composition of the Employment Tribunal and the Employment Appeal Tribunal. We will see a new Employment Judge and a legal practitioner with specific experience of the Employment Tribunal introduced to the Tribunal Procedure Committee. Obviously these reforms will take some time to implement but the proposals mark a long overdue overhaul of processes that have been in place for a very long time. A move to modernise the more antiquated systems can only be welcomed, as long as the appropriate level of care is taken to ensure that the new processes work.

The proposed shake up of Employment Tribunals

Uber and the Gig Economy – is the law keeping up?

After a preliminary hearing spanning seven days (including reading the five-volume bundle and time for deliberation), an Employment Tribunal has handed down its much anticipated ruling that Uber drivers are workers rather than independent contractors. The drivers can, therefore, benefit from statutory protections, such as 5.6 weeks’ paid annual leave each year, a maximum 48 hour average working week (in the absence of an opt-out), rest breaks, the National Minimum Wage, potentially the National Living Wage, and the protection of the whistleblowing legislation.

The Tribunal examined in detail Uber’s business model but rejected Uber’s assertion that it is a provider of technology services rather than transportation services. Passengers can order a taxi via Uber’s smartphone app and Uber’s drivers can then decide (with the extent of the autonomy of such decision one of the factors questioned in this case) whether to drive that passenger to their requested destination and, if they do, the route to be taken. The passenger pays the fare to Uber by credit or debit card, Uber takes a 25 per cent service fee, and pays the balance of fares to the driver on a weekly basis.

The Tribunal looked at various aspects of the arrangement as it operates in reality, rather than as described in Uber’s contracts, to determine whether the drivers are workers as opposed to truly independent contractors. For example, the Tribunal noted the fact that, if a driver declines three trips in a row whilst logged on to the app and so ostensibly available to work, he will be forcibly logged out of the app for 10 minutes. The Tribunal also took note of the fact that Uber prohibits drivers from agreeing with the passenger a fare which is higher than that set by Uber and that Uber usually bears the cost of any cleaning necessitated by a passenger soiling a vehicle.

In summary, the Tribunal concluded that Uber is a taxi service and employs drivers to provide that service in a way which, in a number of key respects, Uber controls. Consequently, the Tribunal held that each of the drivers in this case fell squarely within the statutory definition of a worker as an individual who works under a contract to personally perform services for another party to the contract (Uber) which is not a customer of a business undertaking carried on by the individual. However, we note that this contract did not actually exist (in the sense that no such express agreement had been put in place) but had to be inferred by the Tribunal from the facts as found by it. It may be that the scope for doing so will be one of the grounds on which Uber appeals against the Tribunal’s judgment.

The Tribunal went on to find that, whilst the drivers are under no obligation to switch on the app through which their instructions are received and there is no prohibition against dormant drivers, once the app is switched on, the driver is in the territory where he is licensed to operate and he is able and willing to accept assignments, he is then on working time until one of those conditions ceases to apply.

For the purposes of the National Minimum Wage Regulations, the Tribunal stated that the work carried out by drivers does not constitute “time work” or “output work”, as the driver’s entitlement to pay is not limited to when he is carrying a passenger and does not depend on him completing a particular number of trips. Accordingly, the work was classified as “unmeasured work”, so it is likely that the relevant rate of pay will be calculated by reference to the periods of time when the driver is logged on to the app in his licensed territory and ready to accept passengers, rather than just the time spent driving passengers to their destinations.

This decision is extremely fact specific. Furthermore, Uber has already announced its intention to appeal against it. The outcome is likely to have wide-ranging implications for the concept of the gig economy, the proponents of which claim that it benefits individuals who want the flexibility to work how, when and for whoever they please, in an increasingly interconnected and digitally virtual employment sphere.

The employment landscape is changing rapidly and the challenges to the existing statutory framework presented by the Uber case could be seen as demonstrating that the law also needs to change in order to keep up. In support of its decision, the Tribunal cited an earlier judgment which identified the underlying policy behind the definition of “worker” as the need to extend statutory protection to individuals who are vulnerable to exploitation in the same way as employees. Whilst this is clearly not a new issue, as is evidenced by some of the previous case law referred to in the Uber judgment, perhaps in light of the rise of the gig economy, such policy needs to change and the law, therefore, needs to change with it.

Uber and the Gig Economy – is the law keeping up?

White-collar crimes: companies could soon be held accountable

Proposals for a new criminal finance bill will, if implemented, hold company boards criminally responsible for offences such as money-laundering and false accounting committed by their employees. This is a move that is being heralded as a “crackdown on white-collar crime” and would align Britain more with the US’ notoriously tough stance in relation to such crimes.

Currently companies are only responsible for failing to stop bribery. As evidence of misconduct has to be found at board level for a company to be found liable it has been easy for boards to distance themselves from their employees’ actions, as evidence of board level misconduct is often elusive. However, if the proposals are implemented, boards could find themselves being prosecuted for failing to prevent economic crimes ̶  essentially they could be held liable for the actions of their employees.

The proposals are still very much in the formative stages and a consultation period is reported to be commencing shortly. However, if implemented, these proposals would signal a major change in corporate criminal law. Companies will need to think about how they can actively prevent economic crimes, what policies and procedures they will need to implement to assist in such prevention, and will need to make changes to any incentive schemes that could be seen to motivate employees to do the wrong thing.

White-collar crimes: companies could soon be held accountable

Backing the bump

In the wake of recent press coverage highlighting the vast discrepancy between how employers believe they are treating pregnant employees and how such employees feel that they are actually being treated, the Equality and Human Rights Commission has launched a national campaign to encourage knowledge sharing and best practice in relation to pregnancy and maternity workplace issues.

The “Working Forward” campaign, which is being spearheaded by leading companies such as Barclays, Ford, Royal Mail, BT Group and the Nationwide Building Society, is aimed at making workplaces “the best they can be for pregnant women and new mothers” although fathers, and hopefully employers, will also benefit from the initiative.

Employers are asked to sign up and pledge their support on a voluntary basis. The Equality and Human Rights Commission has identified four key areas that can make a real difference to the experiences of employers and employees alike. Employers are recommended to take action in as little as two of these areas as a starting point. The four areas are:

  1. Demonstrating leadership from the top down: emphasising the importance of awareness of gender diversity and equal opportunity policies at all levels of the business and engendering a culture which is based on such awareness so that it becomes engrained in every aspect of the business;
  2. Ensuring confident employees: who feel able to talk about pregnancy and maternity-related issues without fear of discrimination or detriment;
  3. Training and supporting line managers: so that they can offer the support necessary to all employees who have, are going to have or are considering their options in terms of childcare responsibilities; and
  4. Offering flexible working practices: we have already seen a change in, for example, the flexible working regime to provide more employees with access to such rights, along with the introduction of shared parental leave. However, the Working Forward campaign stresses the importance of building upon such legislative changes and ensuring that flexibility is encouraged in practice and that employers realise the benefits that can flow from more flexible and agile working.

Whilst action in only two of these areas is suggested at first, it seems that once action is taken in even just one of these areas, positive steps relevant to the remaining three areas will flow from this.

The campaign forms part of a broader recognition of the issues and possible discrimination facing pregnant women and new mothers and it seems that steps are, finally, being taken to address such inequality. For example, the House of Commons Justice Select Committee has also recommended a review of the three-month time limit for bringing a pregnancy-related discrimination claim. Whilst it is hard to determine at what point this additional protection should end, it is hoped that such an extension will provide further support for women in the workplace and, most importantly, reinforce the importance of equality for all, in all aspects of employment.

 

Backing the bump

I will drink to that

In 2015, brewing giant Greene King took over ownership of the Spirit Pub Company (Spirit), including its 16,000 workers, the majority of whom were, and are, engaged under zero hours contracts.

A zero hours contract is a contract for casual working, under which the employer does not guarantee to provide the worker with any work and pays the worker only for work actually carried out. The worker is expected to be available for work when or if called on by the employer although the term can be used to describe situations both where the worker is free to accept or refuse work when it is offered, and where the worker is not given such a right of refusal. Whether or not the person engaged under a zero hours contract is, in fact, a worker or an employee will depend upon the wording of the contract but also, and more importantly, how the relationship actually operates in practice.

At the time of the purchase of Spirit, Greene King had already moved all of its staff away from zero hours contracts. It now intends to do the same in relation to the Spirit staff. This means that thousands of staff at household names such as Chef & Brewer and Wacky Warehouse will, over the course of the next year, be guaranteed a minimum number of hours’ work. This follows on from similar announcements across various sectors, with the Everyman cinema chain also confirming that it will be following the example of not only Greene King but also Everyman’s rival, Curzon Cinemas, and retailer Sports Direct.

Despite ongoing criticism of the use of zero hours contracts, they continue, however, to be widely used, particularly in the hospitality sector. In fact, data published by the Office of National Statistics (ONS) on 8 September 2016 suggests that zero hours contracts are now more widely used than ever. 2.9% of the people in employment that the ONS surveyed consider themselves to be engaged under a zero hours contract, with this percentage increasing steadily since 2010.

This means that 903,000 people are currently engaged under zero hours contracts and this is not always seen as a bad thing. The chairman of pub company JD Wetherspoon has said that when offered a choice between a zero hours contract and a contract guaranteeing certain working hours, two-thirds of his staff opted to move off zero hours contracts. However, in stark contrast, McDonalds has stated that when workers in three of its north-west stores were given such an option, over 80% of the employees opted to stay on their existing flexible, zero hours contracts. It continues to be the case, it seems, that whilst zero hours contracts may give rise to uncertainty and exploitation, they may also offer the flexibility which is desirable for certain employers and employees.

I will drink to that

Employees need time and space when breaking up with smoking

The government’s watchdog, Public Health England (PHE), is urging UK employers to give e-cigarette users more frequent breaks than cigarette smokers as well as their own vaping room away from workers who smoke. E-cigarettes turn liquid nicotine into a flavoured vapour, purporting to allow smokers to curb their nicotine addiction without the harmful effects of smoking tobacco. However, PHE suggests that smoking e-cigarettes delivers a lower nicotine hit than traditional cigarettes, and  therefore employers should allow workers to take more breaks to “top-up” their nicotine levels. In addition, PHE states that forcing e-cigarette smokers to go outside would “undermine their ability to quit smoking”. The watchdog hopes that this will encourage workers to smoke e-cigarettes at work rather than tobacco, promoting the health and wellbeing of staff by making it a more convenient alternative.

Currently, under the Working Time Regulations 1998, workers have the right to an uninterrupted 20-minute rest break away from their workstations if their working day exceeds six hours. Statute limits this right to one 20-minute break per day if the shift is at least six hours. It does not provide for rights to extra breaks for smokers or workers who use e-cigarettes. However, employers are under a general duty to prevent risks to health and safety.

Given that smoking and vaping satisfy a nicotine addiction at different rates, it may be best practice for employers to take this into account when assigning the length and frequency of any breaks it grants its staff. This is something employers can develop through workplace policies. With around 2.8 million adults in the UK using cigarettes, employers may wish to note the difference in the effect of vaping compared to smoking tobacco when updating or amending the relevant policies. However, employers should also note that there is no obligation to allow staff to take smoking breaks, and many do not permit this at all. Smokers can, of course, smoke during their rest period if they choose, but this should preferably be in a designated smoking space and must not be in an enclosed area.

Employees need time and space when breaking up with smoking

Mayor of London is on a mission to break “the glass ceiling” that limits women’s success

Despite the turmoil and uncertainty that is Brexit, gender pay gap reporting remains at the forefront of many employers’ agendas for the coming year. This is not least because of the fact that the Equality Act 2010 (Gender Pay Gap Information) Regulations 2016 are expected to come into force on 1 October 2016, with the first pay period for review beginning in April 2017.

Following his manifesto pledge, Sadiq Khan, the Mayor of London, has published a full gender pay audit of all City Hall’s staff. The audit reveals the equivalent of a 4.6 per cent gender pay gap. This may seem low compared to the pay gap of 11.9 per cent for all full-time London workers. However, although more than half of City Hall’s employees are female, the audit shows that only 41 per cent of senior staff earning £60,000 or more are female, and women only make up 29 per cent of the employees who earn over £100,000.

The Mayor has put plans in place to address this gap and increase the number of women taking up senior positions. Examples include mentoring for senior positions and increasing the part-time and flexible working options available. In addition, Mr Khan has called on the Greater London Authority and its functional bodies to carry out their own gender pay audits and ensure full pay equality across their workforce. Mr Khan states that his aim is to “make the Greater London Authority a model employer that removes any barriers to women, adopting the highest possible standards for fair pay, good working conditions and gender equality”. The driving force behind this is Mr Khan’s view that “it is unacceptable that in London … someone’s pay and career prospects can still be defined by their gender”.

The emphasis on narrowing any gender pay gaps and promoting equality for women is ever increasing. Since his appointment as Mayor two months ago, Mr Khan has already appointed women to several top positions at City Hall, such as deputy mayor for transport, deputy mayor for policing and crime and deputy mayor for culture and creative industries. The focus placed on this issue is likely to be intensified with Theresa May’s appointment as the UK’s new prime minister (and the appointment of several female MPs to the Cabinet) and a potential female US president.

These recent developments are positive, especially considering the very limited provisions in the UK for positive gender discrimination. This progress shows that women can adopt positions of power despite the barriers they may face. However, many are of the view that limits to women’s success, because of their gender, should not exist at all.

Mayor of London is on a mission to break “the glass ceiling” that limits women’s success