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January Employment Law Newsletter


We recognise that a time comes in January when you can’t wish people a happy New Year any longer but as its not quite mid month, happy New Year to you all and hello to twelve more months of legal developments for employers and HR professionals!

The next few months include the new-look TUPE (more on this later), fines for employers who make mistakes with employment rights, mandatory Acas conciliation for tribunal claims, and extended rights to request flexible working.

It's going to be a busy 2014 and to get the year to a flying start, we have appointed John Robinson, as a Partner in our expanding employment team. John is looking forward to meeting you in the coming months and we are poised to keep you in the know.

Ill-health dismissals

BS v Dundee City Council

Employee ill-health is one of the most thorny issues facing employers. It demands empathy and patience, balanced against commercial realities and the needs of the business. Perhaps the biggest challenge of all is in recognising when the end of the road has been reached and the employment relationship must be terminated.

The Court of Session in Scotland has given some useful guidance to help employers deal properly with this. When an employee has been on sick leave for some time, the sort of questions a reasonable employer should consider include:

1. Could we be expected to wait any longer before dismissing? If so, how much longer? Relevant here is the size of your organisation, whether or not the employee has exhausted their sick pay, and whether you could call on temporary staff to cover.

2. Have we consulted with the employee and taken their views into account? How do these views sit alongside any medical opinion?

3. Have reasonable steps been taken to find out about the employee's medical condition and the likely prognosis? This doesn't mean that you have to commission a specialist examination. Relying on the available medical advice should be enough, provided the right questions are answered.

It may be instinctive to take length of service into account (and it can be important to do so), but it isn't automatically relevant. What really matters is whether the employee's length of service, and the way in which they delivered that service, leads you to conclude that they are likely to return to work as soon as they can.

Sunday-working requirement discriminatory?

Mba v London Borough of Merton

The Court of Appeal has reminded employers that minority views matter. Even where an employee's religious beliefs are not commonly held, they shouldn't be disregarded. You need to be confident that you can justify instructions on good business grounds, if those instructions cause difficulties to those of specific religious convictions, and that there are no practical alternatives which achieve the same aim without causing difficulties for the employee.

Ms Mba, a practising Christian, was employed by the Council as a care assistant in a children's home. She has a deep and sincere belief that Sunday is a day for worship and not for working.

Staff hours were set out in a shift rota which included weekends, bank holidays and sleeping duties. At first Ms Mba was not required to work on Sundays. That changed and, after failing to turn up on a rostered Sunday, she was disciplined and given a final written warning. She resigned and brought a claim for constructive unfair dismissal and indirect religious discrimination.

The employment tribunal accepted that the requirement to work on Sundays was indirectly discriminatory (it put Christians at a disadvantage), but Ms Mba's claim fell down when it came to the question of proportionality. The requirement was a proportionate means of achieving the employer's legitimate aims, the tribunal held, adding that a belief that Christians should not work on Sundays was not a core part of Christianity.

The Court of Appeal partly disagreed with the tribunal's approach. It wasn't fatal to Ms Mba's claim that not every Christian felt as she did about working on a Sunday. In fact, it was wrong to look at whether others shared that belief. What mattered was whether her belief was sincerely held and whether her treatment was justified.

But what the Court of Appeal gave with one hand it took away with the other. It was proportionate for the Council to demand Sunday working because of the need to provide round-the-clock care, coupled with health and safety requirements. None of the alternatives were viable and practical, the judges said, and they rejected Ms Mba's appeal.

Bring in the TUPE changes

TUPE (or to give it its full title, the Transfer of Undertakings Protection of Employment Regulations 2006) is the law which requires employers who take over a business, or take over certain contracts from another employer, to take on the employees who worked for that previous employer.

At the end of January, some long-awaited TUPE amendments come into force. Here's what is new:

Service provision changes
It will be clearer that, for TUPE to apply, the activities carried on after service provision changes have happened must be "fundamentally or essentially the same" as before.

Employee liability information
The new employer will have more time to consider the liabilities it will be taking on. That information will normally have to be handed over by the transferring employer at least 28 (rather than the current 14) days before the transfer.

Businesses employing 10 or fewer employees will be able to inform and consult with them directly, rather than having to hold elections for employee representatives.

Collective agreements
A new employer will only be bound by collective agreements that were in place at the time of the transfer. They can't be bound by later changes which they weren't involved in negotiating.

Also, terms agreed in a collective agreement can be renegotiated by the employer. That's as long as the new terms are, overall, no less favourable to the employee and don't take effect until at least one year after the transfer.

Dismissals not necessarily automatically unfair
Dismissals will only be automatically unfair where the transfer was the reason for the dismissal (and not where dismissal was for a reason connected with the transfer), unless an economic, technical or organisational reason entailing changes in the workforce applies.

There could be more scope for employers to make changes to employees' contracts after a TUPE transfer. Currently, changes would be void if the reason for them is the transfer itself or a reason connected with the transfer. The italicised wording will no longer apply.

A change of location, post-transfer, could be an "economic, technical or organisational reason entailing changes in the workforce". So an employee made redundant because of a business move won't necessarily have a claim for automatically unfair dismissal. And, in certain circumstances, consultation carried out before the TUPE transfer could count towards any overall 30 or 45-day collective redundancy consultation period.

There is Government guidance to come which should help organisations get to grips with the new provisions. For now, though, the new-style TUPE is being viewed in the round as good news for employers.


Holiday pay and commission

ZJR Lock v British Gas

Commission doesn't form part of holiday pay. Or does it?
An opinion from Europe has set the ball rolling towards resolving conflicting decisions on this.

The case involved a salesman who was paid basic salary and commission. Commission varied from month to month, based on the sales he achieved. When he took a fortnight's leave (during which time he wasn't able to make any sales) his employer calculated his holiday pay simply by reference to basic salary.

The Advocate-General's view (the Advocate-General is a type of preliminary judge in the Court of Justice of the European Union) is that that was the wrong approach. Commission was intrinsically linked to the salesman's work and so should have been included in the holiday pay calculation. If it wasn't included, then he could be deterred from taking annual leave.

The European Court usually follows the Advocate-General's recommendation. If it does, it will prompt employers to review their approach to remuneration and perhaps alter their pay structures. The UK courts would then be required to decide how the commission element of holiday pay should be calculated, but it could be based on an average yearly commission (even where an element of commission hasn't actually been earned).

This is important for anybody who pays commission and may have wider implications for other types of ancillary payments. We'll keep you informed and, once the European Court of Justice decides the case, you can talk to us about ways of dealing with the fallout.


Paid to sleep?

Whittlestone v BJP Home Support

Sleeping on the job has kept employment tribunals busy for years. Employees working night shifts have long argued that even when they're not tending to clients, they are still 'working' and, so, are still entitled to be paid the National Minimum Wage ('NMW').

That's what happened in Ms Whittlestone's case. She was a care worker who visited clients in their homes. For sleepover shifts between 11pm and 7am she was paid £40 (so less than the NMW), and was allowed to sleep when she wasn't needed. There was no evidence that Ms Whittlestone was required to attend to clients during those night shifts.

The Employment Appeal Tribunal (EAT) agreed that she should have been paid the NMW for the whole time spent sleeping over because it was 'time work' under the Working Time Regulations. That was regardless of whether her sleep was broken or not. The EAT held that she was also entitled to be paid the NMW for the time spent travelling between clients' homes.

For employers in the care sector, in particular, this case should trigger a review of contracts and payments made for sleepover shifts. It's a complex legal area, and each case is different, but those employers who get it wrong and don't pay the NMW when they should do could face substantial sanctions and adverse publicity.


Subcontractor has worker status

Boss Projects v Bragg

Cases concerning employment status crop up pretty regularly, and all employers need to be aware that you could be next. The key message to take from these cases is usually the same: parties' declarations about employment status are rarely worth the paper they're written on. Whether someone is a worker (and entitled to employment law protections) or not depends on the work they do day-to-day, and the true nature of their relationship with those they provide a service to.

Mr Bragg was a scaffolding supervisor who worked under a chain of contracts. He was paid by Boss which, in turn, contracted with another company (and it with another) for the provision of subcontractors.

The words of Mr Bragg's contract were pretty clear on his status – he was an independent subcontractor and not an employee. He didn't have to provide personal service, instead having complete discretion to substitute or delegate the work. He could carry out other work before, after or at the same time as he worked for Boss, and was responsible for his own tax and national insurance.

Nevertheless, the Employment Appeal Tribunal found that Mr Bragg was a 'worker', and not self-employed. As with all worker status cases, it boiled down to the nature of the relationship between the parties. Relevant here was the fact that Mr Bragg didn't use his own tools while working for Boss, and that although he could provide someone else to do his work, neither he nor Boss intended for that to happen; he had been personally selected for the role.

And finally….

We all remember those feelings, don't we? A child's desperation to cling onto the tail end of the festive period; the sadness at packing away the baubles; the gut-wrench of going back to school.

Well, it can be tough for grown-ups too. But for those suffering from the debilitating effects of Seasonal Affective Disorder (SAD), these winter months are far more than a time for just feeling a little downbeat. A form of depression, SAD affects disposition and energy levels. It can have a knock-on effect for employers, reportedly costing the UK 9.6 million workdays each year (Epson report).

In an Opinium survey of more than 1,000 UK workers, 20 per cent said they'd called in sick because of SAD, taking an average of four days off a year. Many others reported a dip in motivation.

On the bright side, it seems there are things that can be done in the workplace to combat SAD. Better lighting, more colourful work spaces and more creative visuals are all on the list of things employees would like to see, saying that these would improve their mood.

So it's out with gloomy grey, in with sunshine-inspired hues. Injecting life and positivity into the workplace could well be the answer for some employees, and for employers too.

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