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June Employment Law Bulletin


It's been four years in the making. Now the time has come to pledge allegiance to a remote country (or a front-runner, if you're lucky) because you picked its name out of a hat. It's the Football World Cup 2014 and it's shaking up workplaces everywhere.

For employers, it can be a management minefield trying to work out how to allow staff to take a decent interest in what's happening on the pitches, but make sure that they're still getting on with their jobs and behaving properly. As divisive as football can be, there's no doubt that getting into the spirit of events like the World Cup can help to create a great atmosphere, boost morale and longer-term loyalty at work. However, employers should have clear rules about how they'll handle the next few weeks.

If there's some broad advice we can give you, it's to issue a World Cup briefing to staff. Be open about the concessions and privileges you'll offer (opportunities to watch matches at work or being flexible about starting/finishing late after late-night kick offs, for example) and those you won't. Be fair and consistent when it comes to holiday requests and spell out your zero-tolerance position on aggressive or otherwise offensive behaviour at work.

All that’s left to say is…

Lock, take stock and eschew smoking quarrels

British Gas v Lock

After months of speculation and anticipation, the Court of Justice of the European Union (CJEU) has spoken. It's now clearly the case that where a worker's pay includes an intrinsic element of commission, that commission must be taken into account when calculating their holiday pay.

Mr Lock was a salesman who earned commission based on the hours he worked and the number of sales he achieved. He brought a holiday pay claim for commission that he would have earned if he'd been working and not on holiday. This launched the big question of whether commission should form part of 'basic pay' in holiday pay calculations.

Most definitely, the CJEU has said. However, it declined to say how holiday pay should be calculated to take account of commission.

It's now down to the UK courts to implement the CJEU’s decision and confirm how holiday pay should be correctly calculated. This will take some time, so it may be a while before there is any real clarity on what employers should do in relation to holiday pay, commission and other variable elements of pay such as over-time and on-call payments.

Employers should not ignore this issue pending guidance from the UK courts. The financial impact alone could be significant, so the next few weeks should be used to calculate what this could mean for your business.

We also recommend that you review your contracts and policies and consider whether, when and how to incorporate any variable elements of pay into holiday pay in the future. It won't be a straightforward exercise and it will take some time and careful consideration, but it will be worthwhile to have a clear strategy for managing this potentially significant problem.


Timing of constructive dismissal resignation

Cockram v Air Products plc

Resigning because of an employer's breach of contract takes courage, conviction and a very sound legal argument to back it up. It's a big step for an employee to take.

Mr Cockram’s employer rejected his grievance. This, Mr Cockram said, was a fundamental breach of the implied term of trust and confidence between the two of them. But rather than resign and leave straight away, or after giving three months' contractual notice (as is sometimes acceptable in a constructive dismissal case), he told his employer that he would carry on working for seven months. The reason was that he had no other job to go to. Perhaps he feared the uncertainty of unemployment.

Could that be a constructive dismissal? No, the Employment Tribunal Appeal said. By giving longer than the minimum amount of contractual notice, Mr Cockram had affirmed the contract. He had, in effect, sidelined his employer's breach and could not then use it as the basis of a constructive dismissal claim.

This is a logical decision, useful in bringing to light the question of notice. However, remember that, generally speaking, an employee who chooses to give notice may still have a constructive dismissal claim if (a) the notice is no more than their contractual notice, and (b) they make it clear that they are resigning in response to their employer's fundamental breach of contract – and that they don't accept the breach. It's useful to bear in mind, too, that the employee's actions or omissions during the notice period could affect their constructive dismissal claim.

Flexible working rules stretched

From 30 June 2014, the right to request flexible working will apply to all employees with at least 26 weeks' service.

The types of requests we're likely to see are for home-working, part-time working and job-sharing. It doesn't matter why the employee wants to work flexibly, the employer must deal reasonably with their request and only reject it for a small number of set reasons.

Employers, if you haven’t already done so, it would be a good time to review your flexible working policy to ensure you’re ready for the changes.

Boss can be a worker

Clyde & Co v Bates van Winkelhof

The Supreme Court has decided that a member of a limited liability partnership can be a 'worker'. Previously, lower courts had held that Ms van Winkelhof, a partner in a law firm, could not be protected by whistle-blowing legislation because she did not have the necessary worker status.

The decision is significant because it now opens up employment law protection to a wider group of people, particularly those in legal and financial businesses (commonly LLPs), who didn't think they were entitled to it. What we still don't know is whether LLP members can be employees, or whether worker status extends to those in traditional partnerships.

However, businesses will now need to make sure that their arrangements for the provision of benefits (like pension auto-enrolment), working time rights and unlawful deduction from wages protection are available to all workers.

Care worker's working time

Esparon v Slavikovska

There have been various cases on whether workers who are required to be 'on-call' or to sleep at their place of work are entitled to the National Minimum Wage (NMW) for those hours. They may not actually be working, but they are there and available to work if and when needed.

The law isn't entirely clear on what is and isn't 'time-work' for the purposes of the NMW regulation. The Esparon case may help clarify it a little.

Ms Slavikovska was a care worker who was paid less than the NMW for over-night shifts spent at the care home where she worked. She brought an employment tribunal claim, arguing that the hours she had worked amounted to 'time-work' which attracted the NMW. ('Time-work' is different from time spent 'on-call', which won't in its entirety amount to working time.)

In cases like this, the circumstances are important and the tribunal will look carefully at what exactly the worker is required to do and when during the course of the shift, and why the employer needs the worker to be there during then night.

Like most, if not all, care homes Esparon was legally required to have staff in the facility at all times, so Ms Slavikovska was helping her employer discharge that obligation during her over-night shifts. That swung the decision in her favour and the Employment Appeal.

The tribunal held that Ms Slavikovska's over-night shifts were 'time-work'. Even though she may not have always been actually working (she may have been sleeping), she was still entitled to the NMW during those hours because of the requirement that she be on the premises.

Discrimination didn't cause resignation

Clements v Lloyds Bank

Discrimination will nearly always be grounds for constructive dismissal, if the employee resigns in response to it. In Mr Clements' case, though, an age discriminatory remark was found not to have been the main cause of the employer's breach of contract that led to his resignation. This was significant because compensation for discrimination is uncapped; in ordinary constructive dismissal it is not.

Mr Clements was in his fifties. His employer was attempting to resolve problems with his performance by moving him to a new role. During one of their meetings, his manager twice remarked "you're not 25 any more" (later denying saying this). Over the following few months Lloyds heard and rejected Mr Clements' grievance and announced that someone had been appointed to a role above him, meaning that he had been demoted. Six months after the discriminatory "25" comment, Mr Clements resigned.

The Employment Tribunal held that he had been constructively dismissed because of a course of action which accumulated and resulted in the "last straw" of the demotion announcement. However, it held that age discrimination didn't play a part in the constructive dismissal. Mr Clements appealed that point to the Employment Appeal Tribunal (EAT), but lost. Far more had happened by the time of the resignation, the EAT said. While the "25" comment was an act of age discrimination, it didn't cause his constructive dismissal.

And finally…

It has just been reported that less than 1% of new fathers exercise their statutory right to take additional paternity leave, entitling them to up to 26 weeks’ off work once the baby’s mother or adopter has returned to work.
It seems that society and workplace cultures, and the rate of statutory paternity pay (currently £136 per week), are to blame.

This calls into question whether the forthcoming shared parental leave regime, under which new parents will be able to share up to 50 weeks’ leave from 2015, will make any difference.

Time will tell…

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