March 2019 bulletin
TUPE has been in the news again this month. If the sole or principal reason for a dismissal is a TUPE transfer, the dismissal will be automatically unfair unless there is an economic, technical or organisational (ETO) reason for it (Regulation 7(1) TUPE 2006). The Court of Appeal has recently looked at whether a dismissal for personal reasons at the time of a TUPE transfer can get the employer off the hook for unfair dismissal.
In Hare Wines v Kaur, the employee worked for a business which was taken over by Hare Wines. She had a poor relationship with a colleague, Mr Chatha, who was going to become a director of Hare Wines. The employee was dismissed before the transfer because the new company ‘did not want her’ due to this difficult relationship. Taking these facts into account, the employment tribunal decided that the transfer was the sole or principal reason for her dismissal, which was automatically unfair. The employer appealed, arguing that the sole or principal reason for the dismissal was the difficult relationship, not the transfer.
Both the Employment Appeal Tribunal and the Court of Appeal disagreed. The Court of Appeal said one of two scenarios applied: either the employee was dismissed because of the poor relationship and the TUPE transfer was coincidental; or Hare Wines did not want her on the books because of the poor relationship (which was transfer related). The employment tribunal had been entitled to decide that it was the latter which applied. The transfer was the principal reason for the dismissal, if not the sole reason.
In this case, the employee was dismissed on the day of the transfer. Close proximity between a dismissal and transfer will not be conclusive but is strong evidence in the employee’s favour. The Court of Appeal also noted that the difficult relationship had existed for some time without the employee being dismissed. That only happened when the transfer took place, at Hare Wine’s request. Employers should take great care when dismissing for non-transfer reasons when they are close to a transfer.
ACAS has published new guidance on age discrimination at work. The guidance looks at the key areas in employment where discrimination can happen, including recruitment, performance management and retirement. It addresses the problems that can arise when people are stereotyped due to their age. It looks at ageist language and how it can cause problems. It also has a helpful section on when treating people differently due to age is allowed.
There is a main guidance document (Key Points for the Workplace) covering how and where age discrimination can happen and how to avoid it. It also has two factsheets: one contains the top ten age discrimination obligations for employers and the other lists the top ten myths in this area (together with the accompanying fact to bust the myth). Some of the factsheet content might seem obvious, but they cover the areas where employers can easily trip up.
Read the guidance here:
Nissa v Waverly Education Foundation
In order to satisfy the legal definition of ‘disabled’ in the Equality Act 2010, an impairment must have a substantial and long-term adverse effect on an employee’s ability to perform day to day activities. To be ‘long-term’, the condition must have lasted, or be likely to last, at least 12 months. In Nissa v Waverly Education Foundation, the Employment Appeal Tribunal looked at how to assess the meaning of ‘long term’ when a condition has not yet lasted for 12 months.
The employee was a teacher. She had symptoms of fibromyalgia from December 2015 but was not diagnosed until August 2016, when her employment ended. She brought claims for disability discrimination. The employer disputed that her fibromyalgia had either a substantial or a long-term adverse effect. The material period for the tribunal to consider was December 2015 (when her symptoms began) to August 2016 (when employment ended). This period was less than 12 months. Consequently, the employment tribunal had to assess whether the condition had been ‘likely to last’ at least 12 months in that period, to see if she met the ‘long-term’ element of the test.
The tribunal looked at medical reports from the period, none of which referred to the condition being long-term. They noted that the employee was not diagnosed with fibromyalgia until August 2016. Medical evidence from October 2016 suggested her condition might improve over time. The employment tribunal therefore found that her condition had not been ‘likely to last’ at least 12 months. The Employment Appeal Tribunal disagreed and said that this was the wrong approach. The tribunal had concentrated too much on when the employee was diagnosed with fibromyalgia rather than the effect of the impairment. In considering medical evidence from October 2016 (saying her condition might improve), the tribunal had looked at the situation with the benefit of hindsight rather than based on the evidence from the material period (December 2015 to August 2016). Another employment tribunal panel will look at the case afresh.
It is important for employers to note that the effect of an impairment is often more important than a diagnosis. Employers should also remember that the legal definition of disability can be met if a condition is likely to last 12 months, even if it has only lasted a much shorter period.
If an employee is dismissed for raising allegations that his employer infringed one of his statutory rights, the dismissal will be automatically unfair (section 104(1)(b) Employment Rights Act 1996). There is no two-year qualifying period to bring this claim. The Employment Appeal Tribunal has looked recently at whether this sort of claim can include an allegation that an employer may breach a statutory right in the future.
Mr Spaceman worked for ISS as a porter for less than two years. A colleague made allegations of sexual harassment. The employee asked a colleague to represent him at his disciplinary hearing. The colleague allegedly told the employee he was going to be sacked anyway. The employee raised this conversation at his disciplinary hearing and said his dismissal was predetermined. The employee was dismissed for gross misconduct. The employee did not have enough continuous service to bring an ordinary unfair dismissal claim. He brought a claim for automatic unfair dismissal under section 104(1) instead. He said that his allegation during the disciplinary process that his dismissal was predetermined was the assertion of a statutory right – the right not to be unfairly dismissed. He said that he was dismissed because he had made this allegation (rather than because his dismissal had been predetermined).
The employment tribunal struck out his claim because he had no chance of winning. The Employment Appeal Tribunal agreed. The EAT said that section 104(1) requires an allegation that a statutory right has been infringed. It is not enough to say there might be a breach in the future. The case must be ‘you have infringed my right’ not ‘you will infringe my right’. The right in this case was the right not to be unfairly dismissed. The assertion of this right could only be relied on after dismissal had taken place.
The EAT noted how improbable the employee’s allegations were – if the employer had already made up its mind to dismiss the employee, how could a reaction to the allegation be the reason for the dismissal? This case is a reminder to employers about how creative employees with less than two years’ service can be in dismissal situations. Care should be taken to ensure a fair procedure is followed in all cases, regardless of length of service.
Family leave pay increases
The cost of family leave is set to increase again in April 2019. The government has published its draft Social Security Benefits Up-rating Order 2019. From 7 April 2019, statutory maternity pay, paternity pay, shared parental pay and adoption pay will increase from £145.18 per week to £148.68. Sick pay is also due to increase from 6 April 2019, from £92.05 to £94.25.
Employers should ensure that staff who deal with payroll are kept informed about these increases to ensure that employees are paid correctly, and the right sums are recovered from the government.
Read the draft order here:
Gan Menachem v De Groen
Employees are protected against discrimination due to their religion or belief by the Equality Act 2010. Direct discrimination is where an employer treats an employee less favourably because of their religion or belief (or their lack of it). In Gan Menachem v De Groen, the Employment Appeal Tribunal confirmed that it is the employee’s religion, rather than the employer’s, which is relevant in a direct discrimination claim.
The employee worked in an ultra-Orthodox Jewish nursery. The nursery found out she was living with her boyfriend, which contravened the nursery’s religious principles. At a meeting, the employer told her that her behaviour risked damaging the nursery’s reputation with parents. They asked her to lie and say she was no longer cohabiting, so they could deny all knowledge to parents. She refused and was eventually dismissed. She brought various claims in the employment tribunal, including one for direct discrimination on the grounds of religion or belief.
The employee won all her claims in the employment tribunal, but the Employment Appeal Tribunal disagreed about her religion discrimination claims. The Equality Act 2010 protects individuals from discrimination on the grounds of their own religion or belief. In this case, the employee was dismissed because of her employer’s religion or belief, and the employee’s failure to comply with those beliefs, rather than her own. Her direct discrimination claim failed.
The employment tribunal in this case made its decision before the Supreme Court decision on this point in Lee v Ashers (the ‘gay cake’ case). Less favourable treatment because of an employer’s beliefs is not direct religion or belief discrimination. In this case, the employer would have treated any cohabiting employee in this way, regardless of their religion or belief.
Working time records
CCOO v Deutsche Bank
The Advocate General of the European Union Court of Justice has suggested that employers should keep records of actual hours worked by full time employees in order to comply with the Working Time Directive. In a Spanish case, CCOO v Deutsche Bank, the CCOO trade union brought a claim saying the Bank should record the actual daily working time of all its employees. The Bank records absences for sickness or holiday but does not record actual hours worked on any given day.
The Advocate General accepts that the Working Time Directive does not specifically require daily working hours to be recorded. However, he says that such records are essential in order to ensure employers comply with the law. He argues that without such records, employees would find it difficult to enforce their rights because they will not be able to access any evidence about their working hours.
The Advocate General’s opinion in this case is not binding on the Court of Justice, but their decisions are usually followed. This opinion suggests that the UK’s requirement that employer’s keep ‘adequate records’ about working time limits may not be enough. Employers should not panic yet. Obligations under the Working Time Regulations 1998 will only be affected if the Court of Justice agrees with the Advocate General in their judgment.
Could a shorter working week increase your business’s productivity? A financial services company in New Zealand has trialled a 4-day working week for its 240 staff. They did not reduce their employees’ pay. The trial revealed that employees were 20% more productive, felt less stressed and were more engaged. And because productivity increased during the 4 working days, the total amount of work done remained the same.
The University of Auckland and Auckland University of Technology conducted the study which compared scores given by workers in relation to various questions before the trial and after 8 weeks. The biggest increases were in empowerment and commitment. Work-life balance scores increased by over 20% and stress levels decreased by 7%.
This may not be a one-off trial from the other side of the world. The Wellcome Trust recently announced that they would be trialling a 4-day working week in the UK. Whilst a 4-day working week may not be practical for many businesses, this research shows that long hours do not necessarily mean more output. Moving to a 4-day working week is not the only way to give your business a boost. Happy, empowered staff, however you create them, are likely to be more productive over 5 days too.