Summer Employment Law Update
It’s been a busy time for most people during the Summer months and most sensible people have put the blackberry’s away and gone somewhere hot to lay by a pool. In the meantime, many important employment law changes and decisions have been made which I will bring to your brief attention during this Summer employment law update.
Exclusivity clauses in zero-hours contracts to be banned
The Government has confirmed that it will ban the use of exclusivity clauses and increase the availability of information on zero-hours contracts for employees.
The Government will also work with unions and business to develop a best practice code of conduct aimed at employers who wish to use zero-hours contracts.
The ban on exclusivity clauses will form part of the Small Business, Enterprise and Employment Bill. The Government states that 83% of the responses to the consultation were in favour of the ban.
Severe Obesity may be a disability
In the Danish case of Kaltoft v Municipality of Billund (C-354/13), which was referred to the European Court of Justice, the Advocate General has given the opinion that obesity may amount to a disability for the purposes of the EU Equal Treatment Framework Directive (No.2000/78) but only if it is ‘severe’.
The Advocate General thought it probable that only obesity with a body mass index (BMI) of over 40 would hinder an individual’s participation in professional life to such an extent as to amount to a disability.
He also rejected the argument that there is a freestanding prohibition in EU law on discrimination on the ground of obesity per se.
In the Advocate General’s view, ‘most probably’ only WHO class III obesity, also known as ‘severe, extreme or morbid obesity’ with a BMI over 40, will create such problems in mobility, endurance and mood as to amount to a disability.
Further reduction in number of Tribunal Claims in first quarter of 2014
The Ministry of Justice (MoJ) has published tribunal statistics for January to March 2014. The statistics show that the significant reduction in the number of claims since the introduction of fees in July 2013 has continued.
Ignoring the impact of multiple claims (those involving more than one claimant, which can skew the statistics), the number of claims brought by single individuals has dropped by 59% compared to the same period in 2013. This continues the trend shown in the October to December 2013 statistics of a reduction of 63% in single claims compared to the same period in the previous year. The reduction appears to be consistent across all types of claim and in all tribunal regions.
Of the complaints disposed of by the employment tribunals in the period January to March 2014, 37% related to working time, 19% were for unfair dismissal, 10% were for equal pay and 8% were associated with discrimination.
Statutory holiday pay should include a sum in respect of commission
The ECJ has held that, where a worker’s remuneration includes contractual commission, determined with reference to sales achieved, the Working Time Directive precludes a national law that calculates statutory holiday pay based on basic salary alone. If commission payments are not taken into account, the worker will be placed at a financial disadvantage when taking statutory annual leave as no commission will be generated during the holiday period. In such circumstances, the worker might be deterred from exercising the right to annual leave. This would be contrary to the directive’s purpose.
This case was referred to the ECJ by the Leicester employment tribunal. The tribunal recognised that, under the natural wording of the Working Time Regulations 1998 and the week’s pay provisions of the Employment Rights Act 1996, the claimant was not entitled to a sum in respect of commission in his holiday pay. The case is now likely to return to the tribunal to consider whether the domestic legislation can be interpreted in line with the ECJ’s decision and, if it can, the level of holiday pay to which the claimant was entitled.
Contractual disciplinary procedure did not allow for increased sanction on appeal
The Court of Appeal has upheld the High Court’s decision that an employer could not increase the disciplinary sanction it imposed following the employee’s appeal. The employer, an NHS Trust, had incorporated a formal and detailed disciplinary procedure into the employee’s contract. The employee appealed against the imposition of a written warning and the Trust contemplated increasing the severity of that sanction, which would lead to the employee’s dismissal.
The court held that the contractual procedure did not allow for increased penalty on appeal. To construe the procedure in that way was inconsistent with the terms of the contract and the Acas guide on discipline and grievances. If the Trust wished to reserve its right to increase the disciplinary sanction on appeal, that should have been made explicit in the procedure.
Seldon: law firm partner’s mandatory retirement at 65 was objectively justified
The EAT has upheld an employment tribunal’s decision that, as at 31 December 2006, a law firm’s mandatory retirement age of 65 for partners was a proportionate means of achieving the legitimate aims of workforce planning and staff retention. The retirement age was objectively justified and did not amount to direct age discrimination against a partner, Mr Seldon, who was required to retire on that date. The tribunal correctly determined where the balance lay between the discriminatory effect of choosing a particular retirement age and its success in achieving the aims identified. (Seldon v Clarkson Wright & Jakes UKEAT/0434/13.)
HR letter advising the outcome of a grievance could bind employer to higher pay
The EAT has held that an employer was bound by rates of pay set out in a letter from an HR officer who had investigated a grievance about employees’ pay. The EAT held that the critical principle was whether it was intended that the communication would set out what had been decided by the employer and whether the HR officer was held out by the employer as authorised to make that communication.
However, the question of whether the contract was void for mistake was remitted to be considered by a fresh tribunal. The employer’s argument that the employees must, or ought to have known, that the information provided by the HR officer was in error therefore remains to be decided. (Hershaw and others v Sheffield City Council UKEAT/0033/14.)
Workers on call do not need to be at the workplace to be “working”
The Scottish EAT has held that ambulance paramedics who were contractually required to stay within a three-mile radius of the ambulance station and to respond within three-minutes were working during such on-call periods. It was not a rest period for the purposes of the Working Time Regulations 1998. The tribunal erred in finding that there needed to be a form of near confinement to one specific location for it to be considered working time. The decisive factor was that they were obliged to be present and remain available at a place determined by the employer.
Earlier ECJ cases have considered on-call time to be working time where the worker is required to be in the workplace and ready for work (even though they were sleeping). This case widens the scope to workers who are not required to be in the workplace while on call but are nevertheless subject to certain limitations. In this case, they were not completely free to choose where they would stay since they were limited to a specific area and a specific response time. (Truslove and another v Scottish Ambulance Service UKEAT/0053/13.)
New Acas code of practice and guidance on the right to request flexible working
The right to request flexible working has been extended to all employees with at least 26 weeks’ continuous service, effective from 30 June 2014. To assist employers with handling flexible working requests, Acas has published a new Code of practice: Handling in a reasonable manner requests to work flexibly and The right to request flexible working: an Acas guide.
The Acas Code of practice will be taken into consideration by employment tribunals when appropriate. It provides detailed steps for managing flexible working requests “in a reasonable manner”. The guide provides good practice tips for employers when implementing flexible working policies and considering requests, and sets out “business reasons” for refusing requests.
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