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Employment Law Bulletin February 2015

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Thank you to everyone who has registered to attend our Mock Employment Tribunal next week, which is now at full capacity. It’s set to be a great ‘Hearing’. There is a waiting list for future Mock Tribunals so if you missed out this time, let us know of your interest and we’ll make sure that you have advance notice next time.

There are limited spaces left on the following seminar on 21 April entitled  ‘Milestone Cases Which Have Shaped Employment Law’, which would be a great overview of employment law for managers or refresher for HR professionals.

To register for our April seminar please email heather.oates@clarionsolicitors.com 

The team is looking forward to seeing some of you at the HR Directors Business Summit in Birmingham this week and sharing our observations of trends in the HR community, from the conference, in next months newsletter.

Sarah Tahamtani

Partner

sarah.tahamtani@clarionsolicitors.com

Back claims for Holiday Pay

Towards the end of last year we informed you about the ruling in the case of Bear Scotland, which hit national news. This was the case in which it was concluded that non-guaranteed overtime and other financial payments should be included when calculating holiday pay.

At the time there was considerable concern that employees would be bringing claims going back over many years. In reality, this was unlikely because employees have to make a claim of unlawful deduction from wages within three months of it happening. If there has been a series of deductions (ie the holiday pay has been calculated wrongly over a long period of time) then there must not be a gap of more than three months between the deductions. Most employees will have had a gap of more than three months between a period of holiday, and hence large claims over many years were unlikely but possible.

To give employers further comfort the government has now introduced the Deduction from Wages (Limitation) Regulations 2014, which do two things:

Although this does give employers reassurance it should be noted that the new Regulations will only apply to claims to the Employment Tribunal from 1 July 2015 onwards.

Action:
Although this new law does give some reassurance it will still be possible for employees to make a claim going back over two years if they lodge it before 1 July 2015. So, check your calculation of holiday pay and ensure that it is correct going forward so that any series of deductions is broken.

Employment Tribunal Fees

The trade union Unison has continued with its challenge to the Employment Tribunal fees, which were introduced in July 2013. An initial challenge to the fees failed at the High Court in early 2014. Another challenge was made in late 2014, and this has also been unsuccessful.
At the second challenge one of the key arguments was that the amount of fees that have to be paid is excessive and makes it virtually impossible, or at least very difficult, for a claimant to bring a claim. This argument was rejected because there is a fee remission scheme for those who cannot afford to pay.
It was also argued that the fees could be discriminatory because equal pay claims, which are mostly brought by women, attract the higher level of fee, and women (on average) earn less than men. This argument was rejected because there is no evidence that women are struggling to pay the fee. 
So, for now the fees remain and the number of claims presented to the Employment Tribunal will no doubt continue to be low. However, do remember that claimants are required to engage with the ACAS Early Conciliation Scheme before bringing a claim to the Employment Tribunal (with very limited exceptions) and this process is free.

Action:
Ensure that you engage in any Early Conciliation to help avoid claims and continue to respond to any Employment Tribunal claims that are received promptly, and always in accordance with the deadlines set by the Tribunal.

Employment Tribunal adjournments

The Department for Business, Innovation and Skills has started consultation over the limiting of adjournments in the Employment Tribunal. The proposal is that:
1. An employer or claimant will not be allowed to have an adjournment if they have already been granted two adjournments; and
2. An adjournment will not be granted if the request is made less than seven days before the date of the hearing.
The exceptions will be if:
i. There are exceptional circumstances;
ii. Both the employer and the claimant agree to the adjournment, and the Employment Tribunal believes it could lead to settlement of the case; and/or
iii. The reason for the request is not the fault of the party making the request (eg it is due to an administrative error from the Tribunal, or the other party has been late in disclosing some documents).

Action:
At present, the above are just proposals. However, it is important to note that there are very likely to be restrictions placed on the use of adjournments and these will probably reflect the proposals. Prepare for this by ensuring that you are always prepared for a hearing in good time before it, hence reducing the likelihood that a last minute adjournment would be needed.

Redundancy and the place of work

One possible reason for a redundancy situation is that there is no longer a requirement for employees to work in the location where they are employed. A recent case has looked at how we should define the location where an individual is employed.
In EXOL Lubricants v Birch [2014] the employees bringing claims to the Employment Tribunal were HGV Drivers. They lived in Manchester, but the depot where they had to load up their cargo was in Wednesbury (which is in the West Midlands). Wednesbury was stated as their place of work in their contracts of employment. Due to the cost of commuting EXOL arranged for secure storage of their lorries in Stockport, near to where they lived. They then had to drive from Stockport to Wednesbury to get their cargo. Only the journey from Wednesbury was counted as part of their working day.
It became too expensive to pay for the storage in Stockport, so the employer terminated this arrangement and said that the employees were redundant because Stockport was their place of work, and there was no longer any work based in Stockport. They were unsuccessful in this argument, because the Drivers’ working day started with the drive from Wednesbury. The EAT found that Wednesbury was their place of work.

Action:
When deciding on an employee’s place of work in a redundancy situation you must consider two main factors:

1. What does their contract of employment state?
2. What connection does the employee have with a particular place of work? (In this situation the employees worked out of Wednesbury, that work remained and hence there was no redundancy situation)

Claims when unable to take annual leave

It has been ruled, in several cases, that an employee can carry forward their annual leave from one holiday year to the next if they have been unable to take the leave due to illness. Is this the only circumstance in which leave can be carried forward?
In The Sash Window Workshop Ltd v Dollar [2014] a sales representative was paid on a commission only basis. He argued that he did not take his full holiday entitlement from 1999-2012 because it was not financially possible to take the leave (because he received no pay if he did not sell anything) and because only a minimum number of sales representatives were allowed to be absent at any one time, and this had made it difficult to take the leave. He was claiming payment equivalent to 24 weeks of leave that he had not taken during the 1999-2012 period – arguing that he should be able to carry his entitlement forward from one year to the next.
The Employment Tribunal decided that he was entitled to the payment. The Employment Appeals Tribunal agreed, in principle, that an employee should be allowed to carry forward holiday if s/he was unable to take it due to factors beyond his/her control. However, the case has been referred back to the Tribunal to determine if the employee was really unable to take the leave.

Action:
The simple solution to this problem is to ensure that your employees take their full leave entitlement each year. Ensure that you keep clear records of leave, and check them regularly during the year to ensure that no employee is building up a large allocation of leave that will be untaken at the end of the holiday year.

Losing accreditation to do the job

Pilots need a licence to fly a plane, and doctors need to be registered with the General Medical Council to practice in the UK. What happens if an employee loses a qualification or accreditation that they require to do the job? Can they just be dismissed?
In the case of Devon and Cornwall Police and Crime Commissioner v Weakin [2014] the employee was a Financial Investigator. To do his job he needed accreditation by the National Policing Improvement Agency (NPIA). Although he was not particularly good at his work, he did gain the accreditation. However, his performance level dropped and he lost the accreditation. He was taken through the capability procedure and was dismissed.
This dismissal was found to be fair. The removal of the accreditation meant that he was not capable of doing the work he was employed to do, and there was no alternative employment.

Action:
Although the dismissal was fair in this situation, you should not rush to dismiss an employee who loses a qualification or accreditation, because you must still act reasonably. Acting reasonably would include, at the very least:

Offensive use of social media

Inappropriate use of social media is an ongoing problem for employers. At what point can you conclude that the use has damaged the business such that dismissing the employee concerned would be reasonable?
In the case of Game Retail Ltd v Laws [2014] the employee worked as a Risk and Loss Prevention Investigator. His role meant that he had responsibility for 100 of the organisation’s stores. He set up a Twitter account, and 65 of the stores started to ‘follow’ him. He also ‘followed’ all of the 100 stores.
In his own time, using his own device, he posted some very offensive material. His employer dismissed him for this. He argued that the public did not follow his tweets, and that no-one would have been able to connect him to his employer from what he had posted. However, the Employment Appeals Tribunal found that the dismissal was fair.
The Employment Appeals Tribunal noted that he could have set up two separate accounts – one for private use and one for business use. He had not changed any settings to restrict access to his tweets, and he knew that 65 stores were following him. He could not argue, therefore, that the tweets were private.

Action:
It is very important to have a social media policy to make it clear to employees what you see as acceptable and unacceptable use of social media. Issues you might want to include are:

Time off to volunteer

The charity Business in the Community has recently urged employers to allow their employees time off to volunteer. According to their research only 15% of employers in the UK allow such time off. Business in the Community suggest that volunteering is a ‘win win’ situation, because employees are motivated and learn new skills, and the community benefits from their contribution.
Clearly, the priority for you is to have your employees working in your business – but it could be worth considering the benefits of volunteering. Would it help to build stronger relationships with some of your customers or clients? Would it be an opportunity for employees to practice their skills and hence make them more competent in your workplace? Would it increase awareness of your brand in the community?

Action:
Consider whether it would be useful to discuss this with employee representatives, and see if it could be beneficial to both you and the community in which you are working.

Putting Outplacement back on the Corporate Agenda

Over the last 3 years 2.7million employees have been made redundant costing UK businesses £28.6billion and impacting the UK economic output to the tune of £132billion (Work Audit CIPD March 2012)
However the cost doesn’t stop there – each one of these 2.7million individuals has had to deal with an emotional and challenging transition which is not of their own making. Being dismissed from work rates as the 8th most stressful life event ( Holmes and Rahe stress scale) and the highest which is not family related.
Redundancy can also have a far reaching negative effect on the business if not handled sensitively and effectively. Obviously if an employee feels badly treated they can seek legal redress or possibly more damaging use social media to vent their feelings to a much wider audience who are less interested in fact. The impact on the organisation’s branding can be damaging particularly when it comes to rehiring, new employees are savvy to using social media and websites, such as Glassdoor, to find out what a company is really like. 
As well as the financial cost of the redundancy employers need to factor in the impact on employee engagement of the surviving workforce and what happens to their productivity if they perceive their workmates as having been poorly treated. When it comes to talent retention there is a danger the organisation can lose the very people it needs to keep to survive if they are sufficiently disillusioned. In today’s job market, opportunities are at pre-recession levels so individuals have choices and will vote with their feet.
Along with fair and robust redundancy process the provision of a suitable Outplacement provision for exiting employees can address these issues. In recent years Outplacement has fallen out of favour and it is easy to understand why against the backdrop of the recession when the drivers were primarily pure financial cost. Now access to good quality Outplacement is a cost effective solution and shows that an organisation treats its people fairly even when trading conditions are difficult.
A well-structured programme pre-planned as part of the redundancy process is essential, it will show employees that the organisation is doing as much as it can to provide a level of support and care beyond the employees last day at work to help manage their transition. In many instances Outplacement is a distress purchase made in isolation at the eleventh hour and as such its effectiveness and value is compromised but consulting with a professional Outplacement provider can pay dividends.
Commercially astute organisations understand the need to spend time and effort on treating people well on the way in and now there is as strong a case for treating them just as well on the way out.

Action:
Ensure that you consider the benefits and cost of putting in place bespoke outplacement programme when embarking on a redundancy exercise and if you’d like to explore the possibility, contact one of our partners in the field, Colin Lloyd, Regional Director of Personal Career Management on 0113 800 0113 orcolin@personalcareermanagement.com