ICE Regulations – meaning of ‘undertaking’

Thanks to Sian McKinley of Cloisters for preparing this case summary

Does an undertaking have to be a legal entity for the purposes of the Information and Consultation of Employees Regulations 2004?

Yes, held the EAT in Moyer Lee and others v Cofely Workplace Ltd.

“Undertaking” means a legal entity, namely the employer. There cannot be more than one undertaking within a single employer.

Pursuant to the Information and Consultation of Employees Regulations 2004, the Appellants made a request that their employer negotiate an agreement in respect of information and consultation of employees. To be valid, a request must be made by at least 10% of the employees in the undertaking. The Appellants comprised 28 employees (13%) of 210 employees allocated to a specific contract. The Respondent had 9,200 employees in total, of which the Appellants comprised 0.3%.

The Appellants argued that an undertaking did not have to be the employer and instead could constitute a distinct group of employees within the employer’s organisation. Any other interpretation, they argued, would lead to employees in large multi-site corporations, being deprived of any meaningful protection.

Langstaff P. did not agree and held:

• The Regulations envisage 'undertaking' as a legal entity capable of being the employer of employees serving it under a contract of employment.

• The distinction between undertaking and establishment in the Directive would lack meaning if a separate grouping of employees could constitute an undertaking.

The EAT found that on the facts as found by the CAC Panel, the appeal could not succeed. A reference to CJEU was refused.

Holiday Pay - Voluntary Overtime

Thanks to Gareth Walls of A&L Goodbody NI for preparing this case summary

Should employers include voluntary overtime when calculating an employee's holiday pay?

Cautiously, yes, held the Court of Appeal in Northern Ireland in the case of Patterson v Castlereagh Borough Council.

The industrial tribunal at first instance held that voluntary overtime – being overtime which the employer is not obliged to provide and the employee is neither obliged to perform – should not be included in holiday pay calculations, which was welcome news for employers across the country post Bear Scotland. However (and somewhat unsurprisingly) the decision was appealed to the Northern Ireland Court of Appeal (there being no Employment Appeal Tribunal in Northern Ireland).

The Northern Ireland Court of Appeal held that the industrial tribunal's determination in respect of voluntary overtime was erroneous. Unhelpfully, the Court of Appeal did not provide guidelines as to the tests an employer needs to apply in determining holiday pay and stressed that this was a 'question of fact' for each tribunal to determine, based on the particular circumstances of each individual case and remitted the matter back to the industrial tribunal to determine. Lord Justice Gillen also acknowledged that this latest judgment in the myriad of holiday pay related cases 'certainly will not be the last'.

This judgment opens the door to the inclusion of voluntary overtime, but employers still will not have sufficient clarity on its application.

Although decisions from the Northern Ireland Court of Appeal are not legally binding on the courts and tribunals in England and Wales, employers should be aware of the potential ramifications of this most recent decision, as a persuasive authority, in the continuing holiday pay saga.

Collective Redundancy Consultation - when obligation arises

Thanks to Ed McFarlane of Deminos HR for preparing this case summary Can the obligation to consult over collective redundancies be triggered when an employer makes a provisional decision to close a workplace? Yes, held the EAT, in E Ivor Hughes Educational Foundation v Morris, dismissing a school's appeal against a protective award of 90 days pay per employee in respect of a failure to consult over the closure of a school. The school decided in February 2013 that it would have to close at year's end if pupil numbers had not increased by April. Ultimately, the school decided to close in April 2013 and there was never any collective consultation over the decision, in breach of Section 188 of TULR(C)A 1992. The EAT considered an unresolved question from United States of America v Nolan on the different tests as to what triggers the duty to consult, whether it is an employer proposing a strategic decision that will foreseeably or inevitably lead to redundancies, or when that decision has been made and redundancies are a consequence. The EAT noted that the decision (February 2013) to close the School, unless numbers increased 'was either a fixed, clear albeit provisional intention to close the School or amounted to a strategic decision on changes compelling the employer to contemplate or plan for collective redundancies. On either analysis, the duty to consult arose on that date'. The EAT did not find it necessary to decide which test applied. The EAT also rejected a ground of appeal that special circumstances excused a failure to consult because of the need to keep the closure plans secret for fear of confidence in the school being lost. That an employer which had not thought about consultation might, with hindsight, give consideration to the practicalities of consultation is not a special circumstance excusing the duty to consult.

Indirect Discrimination: Proving Disadvantage

Thanks to Rad Kohanzad of Serjeants’ Inn Chambers for preparing this case summary

Is it necessary in an indirect discrimination claim for the Claimant to show why the provision, criterion or practice has disadvantaged the group and the individual Claimant?

Yes, held the Court of Appeal in UK Border Agency v Essop.

The Home Office has a practice of requiring all staff to sit and pass an assessment in order to become eligible for promotion. The statistics suggested that BME candidates and those who are older than 35 were much less likely to pass the assessment than non-BME and younger candidates, although there was no particular personal factor specific to any individual Claimant that explained their failure.

Allowing the appeal, the Court held that it is conceptually impossible to prove a group disadvantage without also showing why the claimed disadvantage is said to arise. Group disadvantage cannot be proved in the abstract.

Importantly, the Court went on to note that in principle it was open to the Claimants to rely on the statistics as evidence supporting the assertion that they were personally disadvantaged by theprovision, criterion or practice in the same way as the group was. Such evidence may prove facts from which, in the absence of any other explanation, the employment tribunal could decide that the discrimination case is proved, thereby shifting the burden of proof.

Employment Appeal Tribunal

Thanks to Barnaby Large of No.18 Barristers Chambers for preparing this case summary.

Can the Employment Appeal Tribunal hear appeals from parties who were not acting in the employment tribunal case below?

Yes, if the appeal has merit, is not an abuse of process or likely to obstruct the just disposal of proceedings, held the EAT in Martineau v Ministry of Justice.

A number of fee-paid immigration judges brought claims under the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000.

By r36 Employment Tribunal Rules the employment tribunal directed it would hear Ms James’ claim as a ‘Lead Claim’. The other Claimants (including Mr Martineau) had their claims stayed in the meantime and the outcome of the Lead Claim would be binding on all Claimants.

The employment tribunal rejected the Lead Claim. Ms James did not appeal, but Mr Martineau and another asked the EAT to accept their appeals.

In deciding it had jurisdiction to hear the appeals, the EAT reminded itself of s21 Employment Tribunal’s Act 1996 which permitted appeals under 2000 Regulations, was not limited to appeals from litigants in the employment tribunal below. Furthermore, safeguards were available in r3(7) EAT Rules - permitting early disposal of cases that were hopeless, an abuse of process or likely to obstruct just disposal of proceedings.

Tribunal Procedure: No duty to be inquisitorial

Thanks to Karen Jackson of didlaw for preparing this case summary Is it an error of law for an employment tribunal not to adopt a purposive or inquisitorial approach to the evidence before it when determining disability? No, held the EAT in Joseph v Brighton & Sussex University Hospitals NHS Trust. The employment tribunal dismissed claims for unfair dismissal and disability discrimination because Ms Joseph failed to demonstrate that she met the statutory definition of disability (s.6, Equality Act 2010). She suffered from Antiphospholipid Syndrome (a blood disorder) and stress/depression, but failed to make a case for disability in relation to either condition. There was no reference to any functional impairment in her full witness statement, she did not set out any impact on normal day-to-day activities in her impact statement and she failed to demonstrate that either condition had a substantial long-term impact. The employment tribunal accepted the Respondent's case that the very limited evidence on disability could not lead to a finding of disability. The Claimant alleged that the employment tribunal had erred in law by 'ignoring' documents in a 580-page bundle which were not referred to during the hearing. In any event the employment tribunal found that the Respondent had no knowledge: even if disability had been established the claims would have failed. The Claimant sought to show that an employment tribunal has a duty to assist litigants and lay representatives and that this included referring to all the documents in the bundle, relying on Mensah v East Hertfordshire NHS Trust and Muschett v HM Prison Service. The EAT held that this duty did not go so far as to determine how the Claimant should put her case. It would have been permissible for the employment tribunal to provide more assistance but it is not a legal requirement for it to do so. This case demonstrates the high hurdle that is meeting the section 6 definition of disability and the importance to Claimants of adducing substantial medical evidence in support.

Working Time - Travel Time to First Job of the Day

Thanks to Grahame Anderson of Littleton Chambers for preparing this case summary

Does the time that workers (who are not assigned to a fixed or habitual place of work) spend travelling from home to their first customer, and from the last customer back to their homes, count as 'working time' for the purposes of the Working Time Directive?

Yes, suggested Advocate General Bot in Federación de Servicios Privados del sindicato Comisiones Obreras.

According to the Advocate General, there are three aspects to 'working time': being (1) at the workplace, (2) at the disposal of the employer, (3) engaged in work duties (C-151/02 Jäger).

For peripatetic workers: aspect (1) was fulfilled because travelling is an integral part of the job, such that the workplace cannot only be considered as performing work at clients' premises; aspect (2) was fulfilled because routes and destinations are determined by the employer who could at any point modify the instruction; and aspect (3) was fulfilled because, again, travelling is integral to the peripatetic work.

The Advocate General saw no distinction between travel between jobs, which was agreed to be working time, and to and from the first and last jobs, which was not. Further, since working time and rest time are mutually exclusive concepts, and in line with CJEU case law (C-303/98 Simap) rest time must not involve obligations vis-à-vis the employer, the travel time had to be working time.

The recommendation of the Advocate General is not binding, but it is usually followed by the ECJ.

TUPE: Assignment of Employees

Thanks to David Leslie of Lyons Davidson for preparing this case summary. In a TUPE scenario, can the 'client' dictate who is assigned to an organised grouping of employees for the purpose of the transfer? No, held the EAT in Jakowlew v Saga Care. The Claimant worked for Saga as a care manager, principally on a contract with London Borough of Enfield. Shortly before the contract finished with Saga and started with Westminster Homecare Ltd, the Claimant fell out with her line manager and was suspended. Enfield asked Saga to remove her from the contract, as was their right under their agreement. Saga sought to challenge this, only agreeing that the Claimant could be removed from the contract after the transfer date. It was common ground that TUPE applied such that employees assigned to the Enfield contract would transfer from Saga to Westminster. The question, therefore, was whether the Claimant's employment also transferred where Enfield had requested, in effect, that it did not. The EAT found that as Saga had not acted on Enfield's request to remove the Claimant from the contract at the date of the transfer, she remained assigned and should transfer. HHJ Richardson held that 'It is the employer or those whom the employer has authorised who decide to what grouping of workers an employee is assigned'.

Employment Status of GP

Thanks to John Cook of SAS Daniels LLP for preparing this case summary

Was a GP, who provided his services to an NHS Trust through a Cooperative, either an employee or a worker for employment law purposes?

No, held the EAT in Suhail v Barking Havering & Redbridge NHS Trust.

The Claimant, Dr Suhail, worked as an out-of-hours GP and also provided his services from time to time, through a Cooperative, to the NHS Trust at the Urgent Care Centre at Queens Hospital. He was described in the members' agreement of the Cooperative as a self employed contractor, rendering invoices which were paid without deduction of Tax and NIC. There was no obligation on the Cooperative to provide work, nor for the Claimant to accept assignments when offered. He provided his services personally and was free to work for any other organisation. The Claimant actively marketed himself to whichever locum agency offered the most attractive sessional work.

HHJ Judge Peter Clark contrasted the position in Hospital Medical Group Ltd v Westwood. In that case, Dr Westwood was a general practitioner and senior partner in a medical practice in Timperley, Cheshire. He also had an interest in minor surgery and carried out hair restoration procedures for the Hospital Medical Group Ltd. Dr Westwood was found to be a worker but not an employee. Although it was noted that cases of this kind are particularly fact sensitive, the essential point in Westwood was that, although Dr Westwood had other "jobs" he had agreed to provide his services as a hair restoration surgeon exclusively to Hospital Medical Group, he did not offer that service to the world in general, and he was recruited by them to work as an integral part of its operations.

That exclusivity was wholly missing on the facts of the present case. Dr Suhail was free to work or not as often as he chose and wherever he chose. The organisations he worked for were clients/customers of Dr Suhail. On that basis he was neither an employee nor a worker for employment law purposes.

Government announces review of Employment Tribunal Fees

The government has announced its long-awaited review of employment tribunal fees. It is expected to conclude towards the end of the year.

Keen-eyed readers will notice there is no mention of any intention to consult with stakeholders or users of the system (although the government has said it will do so if it decides changes are needed). And cynics might notice that this is coming just a week or two before the Unison tribunal fees judicial review is being argued in the Court of Appeal, possibly to avoid the government being asked to explain why it hadn't made good on its previous undertakings to review the fees regime.

Here is the TUC's reaction.

No Implied Term Duty to Disclose Allegations of Misconduct

Thanks to Ed McFarlane of Deminos HR for preparing this case summary

Is there an implied term in an employment contract that an employee should disclose his own misconduct?

No, held the EAT in The Basildon Academies v Amadi, dismissing the Academies' appeal.

Mr Amadi was a Cover Supervisor at the Academies. He breached his contract by not getting his employer's permission to work at Richmond upon Thames College, where he was accused of sexually assaulting a pupil and suspended. After police involvement, no criminal action was taken against him. The Academies heard about the police investigation and ultimately dismissed the Claimant for not reporting to it the allegation made at Richmond, and for working elsewhere without permission.

The unfair dismissal claim succeeded. The Academies appealed, arguing that there was an implied duty on an employee to report allegations of misconduct, as well as an express duty in his contract to do the same.

The EAT analysed the Claimant's contract and the Academies' policies, finding no express duty on the Claimant to report allegations against him, except for ones he knew or had reason to believe to be true. He could not therefore have been fairly dismissed for conduct on account of breaching his contract or the Academies' policies.

The EAT held that there was no implied term that 'an employee must disclose to his employer, in the absence of an express contractual term requiring him to do so, an allegation however ill-founded of impropriety against him'.

Practitioners should note that the EAT and employment tribunal did not have in the evidence before them the National Standards that applied to the Claimant's employment. The EAT noted that its findings on the express duty point were not likely to be of wider application. An appeal on remedy failed, the EAT noting that arbitrary decisions may be justified by the facts on quantum.

Wasted Costs against Legal Representatives

Thanks to Barnaby Large of No.18 Barristers Chambers for preparing this case summary.

Should an Employment Judge make a wasted costs order against solicitors, on an inferred assumption the unrealistically high Schedule of Loss they produced gave their Claimant client unrealistic expectations?

No, held the EAT in Hafiz & Haque Solicitors v Mullick.

Mr Mullick's claims were dismissed by the employment tribunal as ill conceived. The Respondent applied for wasted costs under r.80 against Mr Mullick's solicitors (i.e. as an 'improper, unreasonable or neglect act or omission'), arguing they submitted a 'grossly exaggerated schedule of loss' which raised Mr Mullick's expectations preventing acceptance of numerous offers to settle. The Employment Judge agreed.

On appeal, the EAT, applying Medcalf v Weatherill and allowing the appeal, held tribunals should be slow to conclude representatives have insufficient material to submit particular pleadings in cases where legal professional privilege prevents revelation of instructions. Employment Judges may make wasted costs order if satisfied (a) there is an improper, unreasonable or negligent act or omission; (b) the costs were incurred as a result of it and (c) the case is one the tribunal could say with confidence there was no room for doubt. The EAT also considered if (a) and (c) were satisfied the judge should still assess the order was fair

TUPE: Meaning of 'client' re service provision changeover

Thanks to James English of Hempsons solicitors for preparing this case summary

If a party contracts out a service, which is then subcontracted, can it be the 'client' for the purposes of a TUPE claim?

Yes, held the EAT in Jinks v London Borough of Havering.

The Council contracted with Saturn to operate an ice rink and car park. Saturn sub-contracted the car park to Regal. Regal's subcontract ended when Saturn gave up the car park, the Council passing it on to a local NHS Trust. The Claimant claimed that his employment transferred from Regal to the Council.

The employment tribunal struck out the claim as having no real prospect of success. A service provision change includes a situation where activities cease to be carried out by a contractor on a client's behalf, and are carried out instead by the client on his own behalf; Reg.3(1)(iii) of TUPE. There was no TUPE transfer here. The client must be the same both before and after the transfer. Saturn was Regal's client, not the Council. There was no contractual relationship between the Council and Regal.

The EAT disagreed. The question was: who was Regal running the car park on behalf of? Who is the client is a question of fact, not law, and there can be more than one client in any given case. A strict legal or contractual relationship was not essential; Horizon Security Services v Ndeze. Further, 'contractor' includes 'sub-contractor'; Reg 2(1) of TUPE. The EAT remitted the application back to an employment tribunal for reconsideration.

Dress Codes, Jilbabs and Indirect Religious Discrimination

Thanks to Naomi Cunningham of Outer Temple Chambers for preparing this case summary

Was an employment tribunal entitled to find that a limit on the length of a garment that a Muslim nursery assistant could wear to work was not discriminatory?

Yes, held the EAT in Begum v Pedagogy Auras UK Ltd t/a Barley Lane Montessori Day Nursery.

Ms Begum, who applied for a post as a nursery assistant, felt obliged by her religion to wear a jilbab, a flowing outer garment covering her from neck to ankle. At her interview, she was asked if she could wear a shorter garment for work, as the jilbab she was wearing was seen as a trip-hazard.

Ms Begum complained of discrimination. The employment tribunal found that the provision, criterion or practice ('PCP') in relation to dress did not put Muslim women at a disadvantage, because an ankle-length jilbab would have been acceptable. There was no evidence given of a religious requirement to wear a floor-length garment. Alternatively, if the PCP did put Muslim women at a disadvantage, it was justified in any event.

The EAT declined to interfere with the employment tribunal’s conclusions: there was no error of law in its approach, nor perversity in its factual findings.

Whistleblowing

The Department of Business, Innovation and Skills has, today, updated its list of prescribed persons and bodies to whom individuals can make a protected disclosure (assuming the other criteria are met).