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June/July Employment Law Newsletter

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Half way through the year and the drip-feeding of employment law changes continues. The Enterprise and Regulatory Reform Act is coming alive, with next month bringing with it the introduction of Employment Tribunal and Employment Appeal Tribunal fees.

There is no denying that tribunals these days are looking more like courts. We now have 'judges' and 'claim forms'. And, from 29 July, fees too. Every claim will cost; how much depends on its type. The price bracket is currently set as £160 to £250 to issue a claim, and £230 to £950 for a hearing.

Most people are expecting fees to influence the way in which settlements are negotiated. But whether we'll see claimants deterred from bringing claims is something no one can predict with certainty. For now? Watch and wait.

News of other changes later in this bulletin.

On Thursday 11 July we are hosting our annual Employment Law Update. The seminar will arm you with up-to-date employment law knowledge, ensure you are ahead of legal changes and provide practical hints and tips to help you in your day-to-day job of running a successful business and workforce. For more information please visit our website and to reserve your place at the seminar please email jenny.rennocks@clarionsolicitors.com.

Re-engagement after Dismissal 
Oasis Community Learning v Wolff

Once a dismissal has happened the employment relationship is usually over. But where the dismissal was unfair, a tribunal could order the employer to take the employee on again. 

That what's happened in this case. The question for the Employment Appeal Tribunal (EAT) was whether re-engagement was the right remedy where the employee had made serious allegations against colleagues and his employer. 

Mr Wolff was a teacher who worked for Oasis, an organisation which helps turn failing schools around. He was dismissed for his confrontational style with pupils, and brought an unfair dismissal claim. In the lead-up to that hearing he alleged that staff had fabricated evidence. He won his unfair dismissal case and the tribunal ordered re-engagement at another of the employer's sites. 

Oasis argued that Mr Wolff's actions towards colleagues meant that re-engagement was not appropriate; the relationship between Mr Wolff and Oasis had broken down irreparably. The EAT didn't agree. It held that where an employee has made serious allegations against colleagues and managers at one workplace, that will not have such an impact on his relationship with colleagues and managers at a different workplace. 

So if you part company with an employee on bad terms, don't assume that you won't be forced back together later on. 


It's All Change in June 
This month brings with it some important employment law changes. 

Political belief dismissals
From 25 June an employee who is dismissed because of their political opinions or affiliation will no longer need two years' continuous service to bring an unfair dismissal claim. 

Whistleblowing
Dismissals stemming from a protected disclosure (otherwise known as whistleblowing) sidestep two important employment law requirements:

  1. The two-year qualifying period for unfair dismissal; and
  2. The cap on compensation. 

From 25 June, workers will only be protected by the whistleblowing laws if they "reasonably believe" that the disclosures they make are in the public interest. (Note that the disclosure doesn't have to be in the public interest; the worker just has to believe that it is.) While "public interest" hasn't yet been defined, it seems safe to say that it will be something that affects more than just one person. So a worker who tries to argue that a disclosure they made about their own employment contract, for example, will probably not be protected.

What about the intention behind the disclosure? Workers who make a disclosure out of spite, rather than to right a wrong, will from 25 June also be given whistleblowing protection. But their compensation could be reduced by up to 25% if the tribunal thinks that the disclosure was made in bad faith. 


It's a Philosophical Belief (honest!) 
Hawkins v Universal Utilities

A tribunal has held that believing that lies should never be told is a philosophical belief, attracting protection against discrimination under the Equality Act.

Mr Hawkins was a telesales agent. He claimed that he was dismissed because he refused to lie to customers. Lying was contrary to his Christian beliefs, he said. The tribunal held that the actual reason for his dismissal was his inadequate performance. He hadn't produced evidence of being told to lie. 

Although his claim failed, others might succeed. Truthfulness is an important and significant aspect of human life and isn't a value unique to Christianity. It can amount to a philosophical belief and, in the right circumstances, could be the basis of a successful claim. 


A New Way of Checking Employees 
From 17 June 2013, employers could have cheaper, quicker access to criminal records information.

The Disclosure and Barring Service (an amalgamation of the Criminal Records Bureau and the Independent Safeguarding Authority) is launching a new Update Service which will allow prospective employers to check that a job applicant's DBS certificates are still valid and up-to-date. 

The flipside of this is that the financial burden of these updates falls with job applicants who are set to pick up the £13-a-year fee for the system. A heavy price to pay? If it means they get the job then maybe not. 


Consulting on Redundancy when Insolvent 
AEI Cables v GMB

Businesses with money troubles can't escape onerous duties. They must balance the need to reduce outgoings quickly with their legal responsibilities.

Consulting with staff in the lead-up to redundancy is one of the basics of employment law. But this takes time, as AEI Cables discovered when it needed to reduce its head count by more than 120 people. The business had been advised by its accountants that unless it cut costs, there was a risk of trading while insolvent (cue directors' liability and potential criminal penalties for fraudulent trading). So AEI made all 124 employees redundant straight away. 

Those employees claimed that AEI had breached its duty to consult. They won and were each given awards of 90 days' pay, which was the maximum allowed. The company appealed and the Employment Appeal Tribunal (EAT) reduced the 90-day awards to 60 days. It was not reasonable, the EAT said, to expect an insolvent employer to carry on trading for 90 days while it informed and consulted with employees. Protective awards are not meant to penalise employers but to encourage them to consult. In AEI's case, some consultation could and should have taken place, despite the urgency of the situation. 

Here the company's financial circumstances helped reduce its burden to consult, but this case makes clear that doing away with consultation altogether is a risky strategy.


Financial Penalties for Employers 
At some point in the next year, although the date is not yet clear, provisions come into force which will allow tribunals to fine employers for the way they breached workers' rights. 

It's all about "aggravating factors". This term has yet to be defined, but we can take it for now that it means what it says: the breach was made worse by something the employer did or didn't do. How much will a guilty employer have to pay? Between £100 and £5,000 depending on the circumstances. Pay within 21 days and the fine is halved.

Lawyers are already poised to thrash out the meaning of "aggravating factors" and it will take a few years before caselaw makes it clear as to what qualifies and what doesn't. But we think reasonable employers are unlikely to experience problems. 


And Finally... 
Where did the time go?

Otigba v Consensa Care

Show us a grown-up who wouldn't fancy being ten years younger and we'll show you a fibber. 

Ms Otigba gave a false date of birth on her job application. Her employer didn't find out about this until it made some routine background checks during her first month of employment. Her Criminal Records Bureau data highlighted discrepancies and she was suspended while the company carried out some more investigations. It looked at her passport, birth certificate, accountancy certificate, driving licence and even her LinkedIn profile. These revealed a series of inconsistencies – she appeared to have two ages and two surnames. 

Ms Otigba was dismissed and brought a wrongful dismissal claim for her notice pay (she didn't have enough service to bring an unfair dismissal claim). She lost; the tribunal held that the employer had gone about everything properly. Trust was important, particularly as Ms Otigba's position involved handling money belonging to vulnerable adults. She had breached this trust by trying to deliberately disguise a lost decade in her life, although the tribunal didn't speculate about the reason behind this. 

The employer here went to great lengths to check the situation out properly and, crucially, didn't jump to conclusions. Remember that in cases like this, even where an employee has a short period of continuous employment, a fair procedure wins in the end.