In this month’s bulletin, we take a look at the recent headlines surrounding workplace dress codes and the Leeds United case regarding constructive dismissal
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We also provide an update on recent developments relating to the contractual status of company handbooks and on the definition of ‘work’ for the purposes of National Minimum Wage. We set out the key points of the Trade Union Act 2016 and further explore the debate on calculating holiday pay, along with looking at recent cases dealing with the definition of ‘belief’ under the Equality Act 2010.
Also find out more about John Robinson, partner in our Employment team, including what three items he would take to a desert island, in his Q&A below.
The Employment team are once again set for a busy month with a number of events on the agenda.
- On 28 June 2016, Sarah Tahamtani will host our What is TUPE? seminar, providing an introduction to TUPE and identifying the situations in which it applies.
- Joanna Dodd will be speaking at the National Centre of Diversity’s Gender Pay Gap Reporting seminar on 4 July 2016 aimed at HR professionals. Joanna will be discussing the Pay Gap Regulations and how to effectively implement the Regulations into your workplace.
- On 5th July 2016, we will host to Leeds Chamber of Commerce’s Annual HR Forum. More details soon.
- Finally, it’s not too late to sign up and enter a team in the Leeds 10K Clarion Corporate Challenge taking place on 10th July. It’s a great excuse to join forces with colleagues and have fun, all whilst raising money for a worthy cause. Click here to see what people say about the challenge and to find out more about how to take part
Company dress codes
The press has reported the story of Nicola Thorp who alleges that she was told she had to wear shoes with a heel whilst working as a Receptionist at a City firm in London. She argued that wearing smart flat shoes was a reasonable alternative, but she was sent home for refusing to wear heels. This raises some interesting questions. What dress codes can you impose on employees, and when could the dress code open up potential discrimination claims?
You can put a dress code in place. However, you must ensure that the code requires a similar level of smartness of both men and women or there is the possibility of a sex discrimination claim. If men are required to wear a shirt, tie and suit then women should also be required to wear a business suit.
You must ensure that your dress code does not discriminate on the grounds of religion. For example, insisting women wear skirts could cause difficulties for Muslim women who, on religious grounds, need to keep their ankles covered.
Can you insist on women wearing high heels? It certainly seems problematic, because some women might struggle if they have back problems or problems with their feet. It is probably best to focus on the smartness of the shoes, rather than the size of the heels.
- Review your current dress code to ensure there is no requirement within it which may place people with protected characteristics at a disadvantage.
- Consider if the requirements of the dress code can be justified by a legitimate aim- i.e health and safety- if so, they are less likely to be discriminatory.
- If your dress code is currently very restrictive, consider introducing more flexibility, and allow exceptions on the grounds of religious belief, disability etc.
Trade Union Act 2016
The Trade Union Bill has now received Royal Assent, and hence we have the Trade Union Act 2016. Although we do not currently have a date that the Act will be introduced, we summarise the key points to note here:
- At present there is only a requirement to have a majority in favour of industrial action for it to go ahead. The Act changes this. There will be a requirement to have at least 50% of those who are eligible to participate in the industrial action voting in a ballot. Then, the requirement will be for a majority of that 50%+ to be in favour of industrial action.
- The rules for essential public services (which are yet to be finally defined) will be tougher. Here at least 40% of those who are eligible to take the industrial action must be in favour of it going ahead.
- A mandate for industrial action will have a 6 month ‘life’ (which can be extended to 9 months if both parties agree). After this life has expired there will have to be a further ballot for industrial action to continue.
- There will be a requirement to have more detail on ballot papers, so that those who are voting in reference to industrial action have a clear understanding of what the proposed industrial action is and the dispute that it relates to.
- At present there is a requirement to give 7 days’ notice of industrial action, once a ballot has been held and is in favour of the action. This will be increased to 14 days, unless the employer agrees to receive 7 days’ notice.
- Subscriptions to a trade union can still be deducted from the payroll as long as the administrative cost of this is not met by the public in any way.
- Trade union members must be made aware if any of their subscriptions to a trade union are being donated to a political fund, and must be able to opt out of this.
We will inform you when details have been given about implementation dates, but do not hesitate to contact us if you have any queries about the Act in the meantime.
The future of non-compete clauses
The government has just concluded consultation about the future of non-compete clauses. These are a form of restrictive covenant and restrict the employee from working for competitors when leaving an organisation, for a limited period of time. The government is concerned that non-compete clauses might restrict entrepreneurship and innovation, and in particular is concerned that they might deter an individual from setting up their own business.
We await the outcome of the consultation and will keep you informed. In the meantime, if you are recruiting new employees ensure that you think seriously about the need for a restrictive covenant in their contract of employment, and contact us to discuss the wording of this so that it gives you appropriate protection.
The contractual status of company handbooks
It is clear that any term that is written in the contract of employment cannot be varied without seeking the agreement of employees. However, what happens with company handbooks. Are they contractual, or can they be varied more easily?
In Department for Transport v Sparks  the issue related to a sickness absence policy. This was in the company handbook, and stated that a disciplinary warning would be given to employees when the number of days of sickness absence they had taken reached a specific number within a prescribed period of time. The Department for Transport wanted to change this, meaning that disciplinary warnings would be given after less absence.
The handbook contained a statement which said that any term in the handbook which was ‘apt for incorporation’ would be part of the employee’s contract. The employees argued that there was no reason that the sickness absence policy could not be incorporated and hence it was contractually binding. Their argument was successful.
- When you add a policy to a company handbook do think about whether you want it to be contractually binding. We can help you ensure that the wording you use reflects the contractual position you want to achieve.
- If a policy is contractually binding you would have to engage in consultation with employees before you could go ahead and make any changes to it.
Definition of work
Over the years a number of cases have looked at the definition of work in relation to the National Minimum Wage (which now also applies to the National Living Wage). A recent case has debated this further.
In The Governing Body of Binfield Church of England Primary School v Roll  the employee worked as a Site Controller at a school. His contract set out that he was required to work 39 hours a week, but was also required to address any emergencies which arose. He was provided with a house close to the school where he was expected to live.
He argued that he was really working 24 hours a day, 7 days a week. He presumed that he was not allowed to stay away from his home overnight, or attend social events that were some distance from his home, in case an emergency arose. So, he argued that he should be paid at least the National Minimum Wage (this case was brought before the introduction of the National Living Wage) for each hour of work. The Employment Tribunal agreed and awarded him £80,000.
The Employment Appeal Tribunal disagreed. There was no contractual obligation to be available for work every hour of the day, and emergencies were very infrequent. Hence, it was not possible to argue that he had been working every hour of the day.
- If you do have any employees who are required to be available in case of emergencies or other call outs make sure that there is a clear explanation in their contract of employment of what the expectations are.
- If you are not sure whether the employee will be able to successfully argue that they are working during any period of being on call, seek our specific advice.
Calculating holiday pay
Another topic where we have seen a number of rulings over recent years has been the calculation of holiday pay. A further case has questioned whether voluntary overtime should be included in the calculation.
In White and others v Dudley Metropolitan Borough Council  56 tradesmen brought claims of unpaid holiday pay, because their voluntary overtime, standby and call out payments had not been included when calculating their holiday pay. They argued that all of these payments were sufficiently regular for them to be considered normal pay. The Employment Tribunal has agreed, ruling that such payments should be included in holiday pay when they relate to situations which occur with ‘sufficient regularity’.
The case does not define ‘sufficient regularity’, and it should also be noted that this is a ruling from the Employment Tribunal which means that the ruling is not binding. However, it is a further indication that the courts are taking the approach of being more likely to include financial elements of pay into the holiday pay calculation, rather than excluding them.
- When calculating the holiday pay of an employee who receives a variable amount of pay you should include items such as guaranteed and non-guaranteed overtime, commission payments and similar financial amounts.
- If you are not sure whether you should include an amount in the calculation of holiday pay contact us for advice.
The definition of a belief
In the Equality Act 2010 one of the grounds on which discrimination is prohibited is religion/belief. Religion is not usually too problematic to define, but belief does cause more difficulties. It has been established, in previous court hearings, that for a belief to be covered by the Act it must:
1. Be genuinely held
2. Be a belief, and not just an opinion or a viewpoint
3. It must be a belief as to a weighty and substantive aspect of human life and behaviour
4. It must have a certain level of cogency, cohesiveness, seriousness and importance
5. It must be worthy of respect in a democratic society, not be incompatible with human dignity and must not conflict with the fundamental rights of others
In Harron v Chief Constable of Dorset Police  an employee argued that he had been discriminated against because of a disability and because of his belief that public money was being wasted. The disability discrimination claim was rejected, but the question was then whether a belief that public money was being wasted was a belief that could be protected under the Equality Act 2010.
The Employment Tribunal found that the belief did not meet requirements 2, 3 and 4 above and hence it was not a protected belief. The EAT has ordered the Tribunal to review the decision, finding that the belief might have more prospect of being covered by this definition than the Tribunal has concluded.
- If an employee does argue that they have been discriminated against due to a protected belief, do not rush to dismiss the suggestion. Work through the five requirements of the definition, and discuss your conclusions with us.
- Above all, remember that no employee should be treated less favourably because of their beliefs.
Did the employee breach the contract?
If the employer breaches the contract of employment the employee can resign and claim constructive dismissal. However, if the employee has already breached the contract of employment a claim of constructive dismissal will not be successful.
In the case of Gibbs v Leeds United Football Club  the employee worked as an Assistant Manager. He had moved to the Club with the Manager, who was dismissed but Gibbs remained at the Club. Gibbs made it clear to the Club that he was happy to leave, but discussions about a possible termination never materialised. The Club then started to marginalise Gibbs, leaving him out of a pre-season tour in Italy, and giving him menial work to do. He resigned and claimed constructive dismissal, but the Club argued that he had already breached the contract by suggesting a termination.
Gibbs was successful. Although he had suggested a termination he had remained ready and willing to work. By excluding him from the Italy tour, and giving him menial work, the employer had breached his contract.
- If there is a situation where an employee is suggesting that it might be best for everyone if they leave the business, ensure that these discussions are recorded and that there is a common understanding of what has been concluded.
- Never try to force an employee to leave an organisation by side-lining him/her. It is very likely to lead to a successful constructive dismissal claim.
Q&A with John Robinson, Partner
Your first job?
I was a library assistant in the beautiful Carnegie Library in Middlesbrough. I’d used it a lot as a child and as I’d always loved books it was a great job.
How did you get into the career you're in?
Whilst at university I realised that I was on the wrong career path. I’d studied law prior to university, was quite good at it and enjoyed it so decided to switch paths when I graduated and requalified as a solicitor. Employment law was always my favourite subject as I love the human interest side of it and because I enjoy a good argument, the contentious side also suited me.
What's the best piece of advice anyone has ever given you?
Stay Alive (Stewart Adamson)
If you weren't doing what you're doing now, what would it be?
Some form of professional sportsperson. I did a lot of martial arts when I was younger and fought at international level, but I’m too old for that now. Spending my life being paid to play golf would be very nice!
Favourite thing about our beloved Yorkshire?
That would have to be my home town Middlesbrough – which was in Yorkshire when I was born there!
Three desert island items?
Sun cream, my ipad and a barrel of single malt.
Golf, some running, a bit of fishing, local history and geneology.
What would you like people to remember you for?
My (sometimes controversial) sense of humour.