Monday 19 December 2005

Review of the year 2005

For those who appreciate a light-hearted review of the employment law year, Wragge & Co. have produced a first-class summary of this year's employment law developments (and a preview of anticipated issues for 2006).

Click here to download (.pdf file)

Thursday 15 December 2005

Transexuals - Advocate General says UK in break of EU law

The Advocate General has, today, handed down an opinion stating that the UK is in breach of EU law.

In the UK, men are entitled to draw a state pension at 65, but women are entitled to draw a state pension at 60.

Sarah Richards is a male-to-female transexual. She underwent gender reconstruction surgery in 2001. In 2002, she applied to be paid her state pension from the age of 60, but was refused by the DWP on the grounds she was still male.

Advocate General Jacobs considered that in that situation the correct comparator is a female person whose identity is not the result of gender reassignment surgery.

In this instance, Ms Richards was denied her pension in circumstances where, had she been registered as female at birth, she would have been entitled to it. The alleged discrimination lies in the United Kingdom's failure to recognise transsexual persons in his or her acquired gender on equal terms with persons recorded as of that gender at birth. The Advocate General therefore considered that it is contrary to Community law for a Member State to refuse to grant a retirement pension before the age of 65 to a male-to-female transsexual where that person would have been entitled to a pension at the age of 60 had she been regarded as a woman as a matter of national law.

Richards v Secretary of State for Work and Pensions (press release - full text of opinion not available until later today)

[Thanks to Marianna Patane of White & Case for telling me about this case]

Ministers of Religion are Employees

The House of Lords, in a judgment handed down this morning, has overturned decades of practice/authority by holding that ministers of religion are employees (at least for the purpose of the Sex Discrimination Act 1975).

Ms Percy was an ordained Minister of the Church of Scotland. She claimed sex discrimination. The employment tribunal, EAT and Court of Session all held she was not an employee within the meaning of the Sex Discrimination Act 1975.

It is important to note that Ms Percy did not appeal the employment tribunal's finding that she was not an employee for the purpose of claiming unfair dismissal. She said that she fell within the wider definition in the Sex Discrimination Act 1975, i.e. that she was engaged "under a contract to personally execute any work or labour".

The House of Lords upheld her appeal by a 4:1 majority.

The majority (Lords Nicholls, Hope, Scott and Baroness Hale) held:

  • the fact that somebody is an office-holder does not mean they cannot simultaneously be working under a contract;
  • the difficulty of establishing the identity of the 'employer', given the fragmented nature of many religious institutions, should not of itself defeat a claim;
  • the offer and acceptance of a church post, with provisions for the appointee's duties and remuneration, holidays, accommodation etc. will give rise to an intention to enter legal relations;
  • * it is quite apparent, given the degree of control and the requirement for Ms Percy to undertake duties in a personal capacity, that there was a contract to personally undertake work or labour.
Dissenting, Lord Hoffman held that the long-established position is correct, and that a Minister of Religion has legal obligations pursuant to being an office-holder, but not under any contract of employment (whether under the narrow definition for unfair dismissal rights, or the wider definition for discrimination rights).

Although the case only dealt with the definition of employee for the purpose of the SDA 1975, this decision does open the door for Ministers to argue that they are employees within the meaning of the unfair dismissal legislation as well (both Lord Nicholls and Baroness Hale suggested that the cases stating that Ministers cannot claim unfair dismissal may need to be revisited).

Percy v Church of Scotland (.pdf version)

Annual Increase in Compensation Limits

The statutory instrument containing the annual increase in compensation limits has just been laid before Parliament.

The increases take effect, as always, on 1st February (2006). They apply to dismissals occurring on or after that date).

The important increases are:
  • maximum compensatory award to rise from £56,800 to £58,400
  • maximum on a 'week's pay' to increase from £280 to £290
For a list of all the increases, see the statutory instrument below.

The Employment Rights (Increase of Limits) Order 2005

Tuesday 13 December 2005

New President of EAT Announced

The DCA has just (12.15pm) announced that the new President of the Employment Appeal Tribunal is the Honourable Mr Justice (Patrick) Elias.

His term is from 3 January 2006 until 2 January 2009 inclusive. He will succeed the Honourable Mr Justice Burton.

Friday 9 December 2005

Maternity Suspension - Obligation to 'Avoid' Risks

An interesting point of construction of regulation 16 of the Management of Health and Safety at Work Regulations 1999 is dealt with in the EAT's judgment in New Southern Railway v Quinn.

Mrs Quinn was (effectively) demoted from the Duty Station Manager's post at Brighton station when she announced her pregnancy. The Respondent justified the demotion on the basis that it was taking steps to "avoid" physical risks (eg assault) flowing from the Duty Station Manager's position.

The employment tribunal found that this assertion was a sham, and that the Respondent had simply adopted "an extremely paternalistic and patronizing attitude towards the Claimant and her condition." It also found that the risk of assault was small and could easily be reduced further.

Before the EAT, the Appellant (employer) argued that the obligation to "avoid" risks was an absolute obligation under European law, so that if there was any risk of harm, the employer was under an absolute obligation to avoid it - in this case, by demoting the Claimant.

The EAT held this argument was wrong. Adopting a purposive approach to the word 'avoid', it held that it meant 'reduce to a low risk' or 'reduce the risk as far as possible', rather than 'eliminate the risk entirely'.

The EAT also dealt with a number of other arguments, including waiver of breach (for the purpose of constructive dismissal). This decision makes interesting reading, not least for the very lucid way both sides arguments are set out and analysed.

New Southern Railway v Quinn

Statutory Grievance letters

They're coming fast and furious...

Yesterday, the EAT published yet another decision on step 1 statutory grievance letters (judgment was given on 13th October, although the transcript was not released until yesterday).

As well as winning first prize in the 'easy case name to remember' competition, Commotion Ltd. v Rutty is another example of the relaxed view that tribunals are taking to whether a letter amounts to a statutory grievance letter under step 1 of the standard grievance procedure.

Mrs Rutty applied in writing for a variation to her working pattern under the flexible working provisions in s80F of the Employment Rights Act 1996. Her letter did not suggest it was to be regarded as a grievance.

Following the employer's unreasonable refusal of the request, in circumstances which the tribunal found was a breach of trust and confidence, she resigned and claimed constructive dismissal. She did not send a subsequent grievance letter.

The EAT (HHJ Burke presiding) upheld the employment tribunal's ruling that the original request to vary her contractual working pattern amounted to a step 1 grievance letter. The EAT relied upon regulation 2(2) of the Employment Act 2002 (Dispute Resolution) Regulations 2004, which provides that it is irrelevant whether the purported grievance letter deals with any other matter.

This decision, whilst demonstrating the relaxed view that tribunals are taking on this issue, is possibly open to being challenged at a future date on the basis that Mrs Rutty's true complaint - and reason for resigning - was not her original working pattern, but was the failure to deal properly with her request for flexible working contained within her letter. This is clearly a fact-sensitive area, which the employment tribunal (and EAT), in this case, considered fell on the side of the line where the letter complied with s32 Employment Act 2002.

The transcript is not yet on the EAT website, but it should be put up in the next week or so. Due to copyright constraints, I cannot attach a copy of the transcript to this Email.

[Thanks to Chris Carr of 36 Bedford Row (who represented Mrs Rutty) for sending me a copy of the transcript.]

Polkey Reductions

Another case from the EAT (HHJ McMullen presiding) reminding tribunals that it is incumbent on them to consider making a Polkey reduction to compensation for unfair dismissal, and that the King v Eaton situation where no reduction should be made because of the difficulty of reconstructing 'what would have happened' should rarely be adopted.

The EAT split the possible Polkey options into four categories (para. 22):

1. Length of time cases, where a dismissal would have occurred in due course;
2. Loss of chance cases, where there was a chance of surviving dismissal;
3. Cases where a reduction has been effected because the Claimant was likely to have been dismissed on another ground; and,
4. Cases where there has been no reduction because there was a complete sham

Gover v PropertyCare Ltd.

Thursday 8 December 2005

What is a Grievance Letter?

Hot on the heels of HHJ Peter Clark's decision in Thorpe & Soleil Investments v Poat & Lake (see bulletin 25/11/05) comes an even more important decision on what does (or does not) constitute a step 1 grievance letter for the purpose of the (standard) statutory grievance procedure.

In Shergold v Fieldway Medical Centre (EAT, 5/12/05), the Claimant wrote a three-page resignation letter setting out the reasons for her resignation. She did not ask for it to be treated as a grievance, although her employers invited her to a meeting to discuss the issues she raised before accepting her resignation.

The employment tribunal held that this did not amount to a step 1 grievance letter, but was instead properly classified as a resignation letter.

The Employment Appeal Tribunal (Burton P. presiding) overturned this, holding:

  • there is no formality required in a statutory standard grievance letter. The requirements "are minimal" - all an employee needs to do is set out his or her complaint in writing (para 30)
  • the statutory procedures should rarely result in the Claimant being debarred or the employer being liable for an automatic unfair dismissal. Burton P. states that the purpose behind the statutory grievance procedures is, like the civil court pre-action protocols, to give the parties a chance to settle disputes before litigating. "The danger is obvious that the kind of pernickety criticism of the form or content of the 'writing' exemplified here can result in an employee being barred from the judgment seat entirely, as occurred here...It is not, in our judgment, the intention of the legislation either that employees should be barred or that employers should unwittingly find themselves liable for automatic unfair dismissal. Those are sanctions, which should be very rarely used; the purpose of the legislation is quite other, as we have described" (para 28)
  • the fact that the written grievance is contained in a letter of resignation "makes no difference at all", provided that it is the setting out of a complaint in writing (para 31)
  • it is not necessary to make it plain in the writing that it is a grievance, or is an invocation of a grievance procedure (para 33)
  • there is equally no requirement that an employee must comply with any company or contractual grievance procedure (para 34)
  • it is not necessary that every detail of the complaint be set out, as a grievance letter is not a pleading. It is sufficient if the employe can "understand the general nature of the complaint being made" (para 37)
  • it is also unnecessary that the employer have the chance to respond to the grievance; all the statute requires (for the standard procedure) is for the employee to set out his complaint in writing (para 38)
NOTE: the EAT stated that it "deprecate[d]" the jargonistic use of the verb 'to grieve', as in 'Has the employee grieved?', and reminded practitioners that 'grieving' has a specific meaning which is not appropriate in the context of an employment grievance (para 17).

Shergold v Fieldway Medical Centre