Monday 31 October 2011

Costs and a "Campaign Beyond the Proceedings"

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Sarah Russell, solicitor at Ventura , for preparing this case summary]

Will pre-trial publicity affect the likelihood of an award of costs being made against a claimant in the EAT?

Yes, according to Iteshi v OFWAT. The Claimant had sent a letter to his MP, copied to the EAT, in which he made unsubstantiated allegations of fraud, and conspiracy with the Government between judges. This was described as part of a campaign to expose and discredit the employment tribunals and EAT and was described as 'disgraceful' and an abuse of process.

The Claimant was also heavily criticized on the grounds that his claim was misconceived and unreasonably conducted.

Even though the Respondent had not issued a costs warning in advance, its skeleton argument was said to be sufficient warning of the way in which matters could proceed, given that the Claimant had a legal background. Costs of £750 were awarded".

Lists of Issues

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Ed McFarlane of Deminos HR for preparing this case summary]

How should a list of issues for an employment tribunal hearing be drawn up?

Not in the way it was done in Price v (1) Surrey County Council (2) Governing Body of Wood Street School says the EAT (Carnwath LJ, sitting as Senior President of Tribunals).

The lay-represented Claimant was constructively dismissed but failed in her whistleblowing case. The EAT made observations about the list of issues drawn up for the employment tribunal hearing, appending that list to its Judgment to illustrate its concerns.

The EAT suggested that lists of issues should distinguish between the central issues "e.g. unfair dismissal and detriment due to a protected disclosure" and the key factual allegations. The EAT noted the failure in the instant case of the list of issues to discriminate between significant factual issues and those found by the employment tribunal to be 'utterly trivial'.

Giving guidance on drafting and using list of issues, the EAT observed "even where lists of issues have been agreed between the parties, they should not be accepted uncritically by employment judges at the case management stage. They have their own duty to ensure that the case is clearly and efficiently presented. Equally the tribunal which hears the case is not required slavishly to follow the list presented to it".

Noting that the case was extended by dealing with peripheral, exaggerated and unsustainable allegations, the EAT called for the provision of basic legal help to unrepresented litigants, in the interests of the efficiency and economy of the justice system, as well as accessibility.

Practitioners may also wish to note a different recent decision of the EAT (Langstaff J) in Land Rover v Short where the parties (both represented) had a legitimate disagreement as to whether 'bumping' was within the list of issues, and noted "the responsibility remains with the Tribunal to deal with the issues which the parties are putting before it, and to identify what they are".

Illegality and Immigration Restrictions

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

Does an employer's reasonable belief that a contract is illegal, and a fear that he would be exposed to penalties provide a defence to an employee's claim for non payment of wages based on that contract?

No, says the EAT in Okuoimose v City Facilities. The question was whether the contract was illegal, not whether it was thought to be illegal.

The claimant was a member, by marriage, of the family of an EEA national. By virtue of the Immigration (European Economic Area) Regulations 2006 (SI 2006/1003) she was at all times entitled to reside and work in the UK. But a Home Office stamp in her passport confirming this expired. She was then suspended from pay for a period until a confirmatory letter from the UK Border Agency was available. The claimant made a claim for unlawful deductions from pay over the suspension period under s 13 of the Employment Rights Act 1996. The employment judge held the contract was illegal and unenforceable during that time.

The EAT (HHJ McMullen) overturned this decision. The claimant was entitled to work in the UK at all times and this was not affected by the failure obtain a new stamp in her passport. It was therefore irrelevant whether the employer was behaving reasonably, or thought it was behaving reasonably, or that it was worried about penalties. The claimant's claim therefore succeeded.

Wednesday 26 October 2011

Causation in Whistleblowing Cases

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Keira Gore of Outer Temple Chambers for preparing this case summary]

What is the test for causation in whistleblowing claims; is it the test that applies in discrimination cases or unfair dismissal cases?

The Court of Appeal in NHS Manchester v Fecitt & ors [2011] EWCA Civ 1190 held that it is neither. Rather, the correct test is: whether the protected disclosure materially influences (in the sense of being more than a trivial influence) the employer's treatment of the whistleblower.

The Claimants in this case were registered nurses employed by the Respondent in a medical walk-in centre. They made protected disclosures regarding a colleague who had made false statements to other members of staff about his clinical experience and professional qualifications. As a direct result of those disclosures they were subject to unpleasant treatment by a number of other members of staff. The working atmosphere became increasingly dysfunctional and the Claimants were removed from the centre (two claimants were redeployed; one ceased to do shift work at the centre).

The Court of Appeal, allowing an appeal by the employer, held that the Claimants were not unlawfully victimised for making protected disclosures. Although the employers were open to criticism for not better protecting the Claimants from unpleasant treatment, their failure was not a deliberate omission and was not because of the protected disclosures. Nor was the removal of the Claimants from the centre because of the protected disclosures; that action was taken because it appeared to be the only feasible method of addressing the dysfunctional situation in the centre.

Monday 24 October 2011

Overlap of Conduct and Capability Reasons

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

If a dismissal letter gives misconduct as the reason for dismissal, but the employment tribunal ET3 pleads "incapability", does the wrong label in the ET3 prevent a tribunal from dealing with the claim on the basis of misconduct?

Not if there is no prejudice to the claimant, says the EAT in Screene v Seatwave.

Mr Screene was a financial controller for an events ticketing business. It was the victim of a fraud when approximately €1.7m were lost from its German bank account. The employer took the view that Mr Screene was grossly negligent in failing to spot this and summarily dismissed him. The employment tribunal found the serious negligence in the employee's failings amounted to gross misconduct and that the dismissal was fair.

On appeal it was argued the tribunal should not have departed from the employer's reason of capability as pleaded in the ET3. Accordingly, it was argued, the tribunal substituted its own reason for dismissal (conduct) in place of the employers pleaded reason (capability) and, as a consequence, failed to direct itself to the relevant law in relation to capability.

The EAT disagreed, relying on comments by Waite J in Hotson v Wisbech Conservative Club [1984] ICR 859. A tribunal was entitled to make its decision on the basis of what it considered to be the real reason for dismissal, provided the claimant was not thereby prejudiced. There was no such prejudice in the present case. At all times the dismissal had been grounded on the same facts, the tribunal plainly conducted the case on the basis of misconduct, and the claimant had acknowledged that he had been summarily dismissed by reason of gross misconduct.

Friday 21 October 2011

Apparent Bias in Professional Disciplinary Panels

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

Is a member of the ILEX Council disqualified from participating in disciplinary hearings against or appeals by ILEX members in the interest of avoiding someone judging their own case, and/or apparent bias?

Yes, says the unanimous Court of Appeal, quashing by Judicial Review on appeal the decisions of an ILEX Disciplinary Tribunal and Appeal Tribunal in R (on the application of Kaur) v (1) The Institute Of Legal Executives Appeal Tribunal (2) The Institute of Legal Executives.

The Appellant, a student member of ILEX, faced allegations of bringing ILEX into disrepute. One allegation was upheld by an ILEX Disciplinary Tribunal, on which – by ILEX rules – sat an ILEX council member. She unsuccessfully appealed to the ILEX Appeal Tribunal, which included the Vice-President of ILEX. She sought judicial review, and argued that the composition of ILEX panels gave rise to apparent bias and/or ILEX being judge in its own case. There was no suggestion of actual bias.

The Court of Appeal considered the distinction between a situation where a disciplinary panel member had active involvement in a body – in ILEX, all council members are company directors – and one where membership did not involve panel members in the body's governance, but noted that the ILEX rules requiring council members to sit on panels made it difficult to insulate professional regulation and the pursuit of ILEX's aims and interests.

In a wide-ranging review of the law on bias, the sole reasoned judgment of Rix LJ brought together the doctrine that no one ought to judge their own case and apparent bias from the leading cases of Pinochet No 2 and Porter v Magill as "... two strands of a single over-arching requirement: that judges should not sit or should face recusal or disqualification where there is a real possibility on the objective appearances of things, assessed by a fair-minded and informed observer ... that the tribunal could be biased ...".

The judgment will be of particular interest to practitioners involved with professional bodies having disciplinary powers over their members.

Re-engagement and Alternative Vacancies

[Thanks to Jahad Rahman of Kervin & Barnes Solicitors for preparing this case summary]

Does a finding that a dismissal was genuinely on grounds of redundancy remove the need to explain the remedies of reinstatement or re-engagement?

No, says the EAT in the case of King v Royal Bank of Canada.

Ms King was dismissed by reason of redundancy. The tribunal found that the dismissal was automatically unfair because there was a complete failure to follow the Statutory DDP (now repealed). However, the tribunal concluded that there was a real redundancy situation and as there was no suitable alternative job, the dismissal was not substantially unfair. With regard to remedy, the tribunal awarded compensation for financial loss but overlooked the issue of reinstatement or re-engagement. Ms King asked for reinstatement in her ET1 form and confirmed in her statement that she was seeking re-engagement.

Ms King appealed the decision. She was not legally represented at the time and re-employment was not raised as an issue in her Notice of Appeal. The question of re-employment was only raised at a preliminary hearing by Counsel and permission to amend was granted. RBC applied to vary or discharge the proposed amended grounds.

The EAT held that the tribunal's failure to deal with the remedies of reinstatement and re-engagement constituted a "striking omission" and concluded that it "was and is right to grant permission to amend" on the basis that any prejudice to Ms King would far outweigh any prejudice that RBC would suffer. The EAT also held that the tribunal wrongly restricted itself to considering only vacancies at the time of Ms King's dismissal as the situation with regard to possible vacancies may have changed between the date of dismissal and the period during which RBC ought to have followed a fair procedure.

Mitigation of Loss

[Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

Does the duty of mitigation, which applies for the purposes of claiming compensation before the employment tribunal, oblige a wronged employee to consider an offer of new employment with the employer with whom there has been a dispute?

Yes, says the EAT in Debique v Ministry of Defence.

Ms Debique worked for the British Army. She gave birth to a daughter. She was a single parent and found it difficult to combine motherhood with her responsibilities as a serving soldier. After a dispute she gave notice and left. She succeeded in her claim for unlawful indirect sex and race discrimination (see [2010] IRLR 471).

At a remedies hearing before the employment tribunal she was awarded £15,000 for injury to feelings but nothing for loss of earnings, on the basis she had failed to mitigate her loss. She had refused an offer, made by her employer during her period of notice, of a posting which would have provided stability and which would adequately have addressed her childcare difficulties.

The EAT held that whether her refusal to accept the offer made to her was an unreasonable failure to mitigate loss was a question of fact for the tribunal. The tribunal had correctly applied the test and considerations formulated by Potter LJ in Wilding v British Telecommunications plc [2002] ICR 1079 and its decision would not be disturbed. The tribunal's finding that there was no case for aggravated damages was also upheld.

Monday 17 October 2011

NHS Terms and Conditions of Service

[Thanks to Laurie Anstis of Boyes Turner who is standing in for Daniel Barnett during holiday absence, and to Ed McFarlane of Deminos HR for preparing this case summary]

What happens to the pay of a part-time NHS doctor taking up a full-time training position when undergoing approved training? The relevant NHS Terms and Conditions allow clinical staff to have their pay protected, but they do not deal with the pay of part-timers. Should she be paid at a "full-time rate" for her previous job, even if that means that her pay whilst training is considerably higher than her previous, part-time pay?

No, says the Court of Appeal in Barts NHS Trust v Verma, by a majority (Rix and Rimer LJJ), with Elias LJ dissenting.

The Claimant had a sessional post and worked two sessions (7 hours) a week. When she took a full-time House Officer position as approved training, the Respondent Trust limited her protected pay to the maximum pay for her sessional position at five sessions or 17.5 hours – resulting in a pay rise for the Claimant, but not paying a notional full-time equivalent salary at sessional rates.

When the Claimant brought a wages claim, seeking protected pay at the notional full-time sessional rate for her previous role, the employment tribunal held that her pay was protected for five sessions per week. The Claimant appealed successfully to the EAT, and was awarded her notional full-time sessional pay, meaning she was paid more than twice her previous pay. The Respondent Trust conceded that the employment tribunal's decision on five sessions was correct.

On the Trust's appeal, the Court of Appeal, noting the difficulties caused by the wording of the NHS Terms and Conditions, overturned the EAT's decision and restored the employment tribunal Judgment. Although the majority of the Court of Appeal considered that it should only be two sessions that were protected, the Trust's pragmatic concession left the employment tribunal's Judgment unaffected. Rix LJ held that "the natural, rational and purposive interpretation of these provisions relating to protected pay... [protects] ...the practitioner for the pay in a previous role which he or she earned" but does not "[extend] their pay to a figure possibly far in excess of any figure previously earned".

The Judgment sets out the correct approach for part-timers moving to full-time with protected pay, and is likely to be mainly of interest to those dealing with NHS clinical staff, as it relates to terms and conditions of service peculiar to that part of the NHS.

Thursday 13 October 2011

Dismissal Cannot Be Retracted - Normally

[Thanks to David Campion of EAD Solicitors for preparing this case summary]

Where an employer provides an intended, unambiguous written notice of termination to an employee, can that employer subsequently unilaterally resile from the termination notice on the basis that the notice was premature and/or a mistake?

No, says the Court of Appeal in CF Capital v Willoughby.

In the context of potential future redundancies, the parties discussed the Claimant potentially becoming engaged on self-employed basis.

However, prior to any self-employment arrangement being agreed, on 22nd December 2008 the Respondent sent the Claimant notification that her employment would terminate on 31st December 2008 and informed the Claimant that an alternative agreement would commence on 1st January 2009.

The Claimant contacted the Respondent on 5th January 2009 and stated that she did not accept the alternative agreement and that the Respondent's letter had terminated her employment. The Respondent stated that if the Claimant did not wish to become self-employed then the relationship would continue as before. Once the Claimant failed to return to work, the Respondent concluded that the Claimant had resigned.

The ET dismissed the Claimant's unfair dismissal claim on the basis that the Claimant had resigned. The ET held there were 'special circumstances' that needed to be taken into account as the reference to the termination of the Claimant's employment had to be an error on the Respondent's part and as the Respondent withdrew the dismissal once it had realised its mistake. This decision was overturned by the EAT.

The CA upheld the EAT's decision that the Claimant had been dismissed. The CA held that the Respondent had intended to dismiss the Claimant and had done so using clear and unambiguous terms.

After reviewing relevant case law concerning 'heat of the moment' resignations and dismissals, LJ Rimer concluded that the 'special circumstances' exception is not a true exception to the rule that notice of dismissal cannot be unilaterally retracted; it merely permits the giver of notice an opportunity to satisfy the recipient that he had never intended to give notice.

Wednesday 12 October 2011

Overlapping ET and High Court Claims

[Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

Should employment tribunal proceedings be stayed when there are threatened High Court proceedings arising from the same facts, but which have not yet been issued?

Yes, given certain conditions, says the EAT (HHJ McMullen) in PaymentShield v Halstead.

H brought employment tribunal proceedings. His solicitors then sent a letter pursuant to the CPR Practice Direction on Pre-Action Conduct threatening High Court proceedings and attaching draft particulars of claim. The employer sought a stay of the tribunal proceedings. The claimant at first agreed but then (wanting to fund the High Court case from the proceeds of the tribunal case) applied for the tribunal proceedings to be reinstated. Two employment judges agreed with him on the ground that the High Court proceedings had not yet been issued. The employer appealed.

The EAT considered the stay should be granted. The principles to be applied in granting a stay were to be found in HHJ McMullen's own decision in Mindimaxnox LLP v Gover (EAT/0225/10). These include where there are complex issues, overlap and where the High Court might be "straitjacketed" by an employment tribunal's finding of fact. And they apply even where the proceedings have not yet been issued. The indication of proceedings in the present case was more than "a glint in the claimant's eye". The pre-action protocol was an important part of the CPR and the claimant's conduct was a clear indication of his intention to claim relief in the High Court.

TUPE and Variation of Contract

[Thanks to Dr John McMullen of Wrigleys Solicitors LLP for preparing this case summary]

When is an agreed variation of the employment contract following a TUPE transfer effective? When the transfer is not the sole or principal reason for the variation, says the EAT in Smith v Trustees of Brooklands College.

The employees, who were teaching assistants, were employed by Spelthorne College. They enjoyed unusual employment terms. They were paid as full time employees when they only worked part time. In August 2007 the college was transferred, under TUPE, to Brooklands. Afterwards, Brooklands realised the claimants were on terms out of step with the rest of the sector. It sought to bring the contracts into line. Reluctantly, the employees agreed a detrimental adjustment to achieve this, effective from 1 January 2010. Subsequently, the employees claimed the variation in pay was ineffective, since Reg 4(4) of TUPE makes a purported variation of an employment contract void if the sole or principal reason is the transfer itself.

The claimants argued that "but for" the TUPE transfer, the variation would not have taken place. But, said HHJ McMullen, that was not the test. The question was, what was the reason for the change? What caused the employer to do it? This was a clear question of fact and the finding of the employment judge that the variation was not by reason of the transfer would not be disturbed. The judge had correctly had regard to what was in the employer's mind (the need to correct an obvious error in pay), and also the distance between the transfer and the variation, and his decision was "unimpeachable".

Monday 10 October 2011

Permission to Amend Notices of Appeal

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

Should an Appellant to the EAT be permitted to amend a Notice of Appeal in a Rule 3 (10) hearing?

'Yes, generally' states the EAT (Underhill P) in Readman v Devon Primary Care Trust, holding that it will generally be in the interests of justice to allow an application to amend a notice of appeal at a 3 (10) hearing.

A Rule 3 (10) hearing permits an Appellant whose Notice of Appeal has been rejected on the sift as showing no material error of law to argue that the appeal ought to proceed as having a reasonably arguable point of law.

The Claimant appealed after failing in her claim for a redundancy payment at Employment Tribunal. The Claimant's Notice of Appeal had been rejected both on the sift and after amendment under Rule 3 (8), and she requested a 3 (10) hearing. With assistance from Counsel via ELAAS, the Claimant successfully applied to amend the Notice of Appeal to include a reasonably arguable point. The Respondent then applied unsuccessfully to set the amendment aside. The EAT considered the leading case on amendments in appeals of Khudados (see bulletin 24th March 2005) and gave guidance on the approach to amendments at a 3 (10) hearing.

The EAT observed that unrepresented Appellants often appeal without showing proper grounds, and a 3 (10) hearing will often be the first point at which they have a practical opportunity to obtain professional advice, when arguable points may emerge, requiring permission to amend. The EAT noted that amendments could include points not raised previously in a Notice of Appeal, provided that they were reasonably arguable. It would be exceptional to not permit amendments at a 3 (10) hearing, as Appellants rarely go there by choice.

The EAT was mindful of the delay arising from this procedure, but held that in this case, it did not outweigh the right to have an appeal determined. The EAT also suggested that Respondents wishing to object to an amendment would be better to raise their objection at the full hearing with the substantive appeal rather than risk the delay and cost of an interim hearing.

The EAT also noted that the right to amend a Notice of Appeal under Rule 3 (8) is absolute.

Wednesday 5 October 2011

Disability Discrimination: Reasonable Adjustments

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

Is it direct discrimination for an employer to refuse to spend on reasonable adjustments a sum similar to what it would spend on financial assistance for an employee with children? Does an employer in these circumstances fail in a duty to make reasonable adjustments? No, and not necessarily, according to the EAT (Underhill P presiding) in Cordell v FCO UKEAT/0016/11/SM.

Ms Cordell was an FCO employee who, being profoundly deaf, required the support of lipspeakers. A posting to Astana was withdrawn in light of a report estimating the cost of that support at over £300,000 p/a. Ms Cordell relied on the FCO's willingness to pay school fees up to £25,000 per child p/a, and complained of direct discrimination and a failure to make reasonable adjustments. She failed at first instance and on appeal.

The EAT held that there was no direct discrimination: the job was withdrawn because of cost, not because of Ms Cordell's disability. The tribunal's consideration of the cost of lipspeakers in the context of the FCO's total budget for reasonable adjustments and the total cost of embassy staff was legitimate, and what the FCO was prepared to spend on school fees was relevant but not determinative.

Tuesday 4 October 2011

Permanent Anonymity Orders

[Thanks to Lionel Stride of Temple Garden Chambers for preparing this case summary]

In F v G the EAT has provided useful guidance as to the circumstances in which orders for restrictions on reporting and/or anonymity can be made both within and outside the ambit of Rule 49 (anonymity orders in cases involving allegations of sexual offences) and Rule 50 (temporary restrictions on reporting in cases involving allegations of sexual misconduct) of the Employment Tribunal Rules of Procedure.

M Justice Underhill suggested that Tribunals adopt the following approach:

  1. Consider whether Rule 49 applies. If so, anonymisation would normally be considered mandatory.

  2. If Rule 49 does not apply, consider whether restrictions on reporting or anonymisation are required to protect the rights of a party under Article 8 of the Human Rights Act (HRA) and, if so, what measures are necessary and proportionate.

  3. If such protection is required:
  • If, possible, take any measures under Rule 49 or 50.

  • If neither rule applies (e.g., because there is no sexual offence or misconduct), the measures should be taken in exercise of the general powers of the tribunal under Rule 10 as set out in A v B [2010] ICR 849.

  • If the case falls within the scope of Rule 50 but the relief available under that rule is too limited (e.g., because any restriction of reporting is required beyond the end of proceedings), the Tribunal should set out which powers, whether under Rule 50 or Rule 10, are engaged for each part of the order.

  • If there is no entitlement to protection under the HRA, there is no scope to go beyond the powers within Rule 49 or 50.

  • Tribunals can consider interim restrictions or anonymity and make the final decision at the conclusion of proceedings.
  • On the facts of the case, the EAT upheld a permanent anonymity order made under Rule 49 that included the names of the Appellant, F, who had won her claim for sex discrimination, and the college at which she worked, as well as disabled students and staff members. Although Rule 49 had no application because there had been no allegation of any sexual offence, the EAT concluded that the wider powers recognised in A v B justified such an order to protect the rights of the students and staff at the college.

    Monday 3 October 2011

    Osborne announces Employment Law Reforms

    Chancellor George Osborne has announced two important changes, intended to reduce the number of employment tribunal claims and boost the economy.

    First, the qualifying period for unfair dismissal will be increased from one year to two years with effect from 1 April 2012.

    Second, fees will be introduced for tribunal claims. From the (sketchy) information currently available, it appears the following fee structure will apply (note: this is all second-hand information, including from the Evening Standard; I have not seen the text of the speech):
    • upfront fee of £250 when lodging ET1;
    • further fee of £1,000 payable by Claimant when the hearing is listed;
    • higher fees if the claim is for over £30,000;
    • fee to be refunded if Claimant wins, and forfeited if they lose
    • fees to be waived for those with no money
    The devil is always in the detail. If the test for a fee-waiver is simply being on income support, then most ex-employees will automatically qualify for the waiver (but those still in a job will not). Note that the issue fee of £250 (and hearing fee of £1,000) is substantially greater than the small claims issue fee.

    Red Tape Challenge

    The government has opened a three week consultation period for employment legislation under its 'Red Tape Challenge' scheme, aimed at inviting the public to comment on how laws can be simplified.

    The Red Tape Challenge, available here, is divided into four sections:
    • Compliance and Enforcement;
    • Letting People Go;
    • Managing Staff; and,
    • Taking People On
    You add your comments on employment law regulation to a 'comments' section on the website, which strikes me as notable only for the lack of any balanced views. My favourite is from the chap who complains about all the abbreviations in employment law which he finds difficult to understand, even though he has a (in his words) 'MBA'.