Following an initial consultation period last year, the DTI has issued a further consultation paper on the new laws required to comply with the Young Workers' Directive, having amended the original proposals.
The new law will apply to 'young workers', defined as those over school leaving age, but under 18.
The latest position, which will be introduced through amendments to the Working Time Regulations 1998, are:
Working Hours
• a young worker's time shall not exceed eight hours a day or 40 hours a week (whether working for one or more employers);
• the maximum 8-hour day / 40-hour week shall not apply where the work is necessary to maintain continuity of (or respond to a surge in) service or production, where the additional hours will not interfere with training and where there is no adult worker available to perform the work.
Night Work
• young workers are not permitted to work between either 10pm and 6am (the default position) or, if the contract of employment provides, between 11pm and 7am.
• unless they work in particular sectors (agriculture, retail trading, a hotel, a bakery, catering activities other than a restaurant or a bar, or postal/newspaper deliveries), when the prohibited hours of work are between 12 midnight and 4am.
The further consultation period is open until 6th September 2002, and the new legislation will be introduced very shortly afterwards.
For more detail, go to http://www.dti.gov.uk/er/individual/youngconsult.htm
Friday, 14 June 2002
Tuesday, 11 June 2002
Leaked Proposals to overhaul employment law
Very few people will have missed the front page of today's Times, which contained an article describing an impending consultation paper from the DTI, due this summer.
Apparently the consultation paper will seek views on changing the law to:
• abolish the rule for one year's continuous employment for claiming unfair dismissal;
• lower the threshold for union recognition;
• an increase in the £52,600 cap for the unfair dismissal compensatory award;
• greater powers for re-instatement of unfairly dismissed employees;
• abolition of 'zero hour' contracts.
More details in The Times 11/6/02, pp1 and 22.
Apparently the consultation paper will seek views on changing the law to:
• abolish the rule for one year's continuous employment for claiming unfair dismissal;
• lower the threshold for union recognition;
• an increase in the £52,600 cap for the unfair dismissal compensatory award;
• greater powers for re-instatement of unfairly dismissed employees;
• abolition of 'zero hour' contracts.
More details in The Times 11/6/02, pp1 and 22.
Friday, 7 June 2002
New EAT Decision
This decision has just been placed on the EAT website. It is currently unreported, but may be reported in due course.
McLeod & Welsh v Phoenix Taxis & Rainbow Taxis (Lord Johnstone, 22/4/2002)
A surprising TUPE decision from the EAT. Phoenix taxis (a radio-cab company) sold its 'business' to Rainbow taxis. The employment tribunal found as a fact that, despite the description in the contract as a sale of a business:
• no assets had transferred
• no staff had transferred
• no premises had transferred
• the only thing that had transferred was the (temporary) use of the 'Phoenix Taxi' name and the Phoenix Taxi telephone number
The ET also held that the Phoenix Taxi undertaking ceased to retain its identity after the sale. Accordingly, after considering Spijkers, it held there was no transfer of an undertaking.
The EAT held that the ET failed to give sufficient weight to the label in the agreement of 'sale of the business'. Not only did the EAT allow the appeal, but it substituted a finding that a TUPE-transfer had occurred (rather than just remitting the case back to the ET).
This case seems to be authority for the proposition that the label the parties use is conclusive (rather than a balancing of the factors set out in Spijkers). It opens the way for purchasers of businesses to insist on writing into a contract 'there is no transfer of undertaking' and arguing that label is binding. That cannot be right.
• To see the decision, go to http://www.employmentappeals.gov.uk/uploads/EAT1344012242002/index.htm
McLeod & Welsh v Phoenix Taxis & Rainbow Taxis (Lord Johnstone, 22/4/2002)
A surprising TUPE decision from the EAT. Phoenix taxis (a radio-cab company) sold its 'business' to Rainbow taxis. The employment tribunal found as a fact that, despite the description in the contract as a sale of a business:
• no assets had transferred
• no staff had transferred
• no premises had transferred
• the only thing that had transferred was the (temporary) use of the 'Phoenix Taxi' name and the Phoenix Taxi telephone number
The ET also held that the Phoenix Taxi undertaking ceased to retain its identity after the sale. Accordingly, after considering Spijkers, it held there was no transfer of an undertaking.
The EAT held that the ET failed to give sufficient weight to the label in the agreement of 'sale of the business'. Not only did the EAT allow the appeal, but it substituted a finding that a TUPE-transfer had occurred (rather than just remitting the case back to the ET).
This case seems to be authority for the proposition that the label the parties use is conclusive (rather than a balancing of the factors set out in Spijkers). It opens the way for purchasers of businesses to insist on writing into a contract 'there is no transfer of undertaking' and arguing that label is binding. That cannot be right.
• To see the decision, go to http://www.employmentappeals.gov.uk/uploads/EAT1344012242002/index.htm
Tuesday, 28 May 2002
Newsflash: Government Reshuffle
Following the resignation of Stephen Byers yesterday, 10 Downing Street has just announced that the new Secretary for Work and Pensions will be Andrew Smith.
And for those who are interested in such mundane matters, the existing Work and Pensions Secretary, Alistair Darling, will replace Stephen Byers as Transport Secretary.
And for those who are interested in such mundane matters, the existing Work and Pensions Secretary, Alistair Darling, will replace Stephen Byers as Transport Secretary.
New EAT Decision
This decision has just been placed on the EAT website. It is currently unreported, but may be reported in due course.
Hill v Howard Chappel (HHJ Peter Clark, 20/3/02)
An employer is not entitled to deduct overpaid holiday from an employee's final salary payment, in the absence of a 'relevant agreement' under the Working Time Regulations 1998 authorising such a deduction.
Thus, on the facts, Mrs Hill had taken 15 days' holiday in the holiday year when, on a pro rata basis, she was only entitled to take 10 days. The employment tribunal, when awarding Mrs Hill her unpaid salary, gave credit to the employer for the 5 days' additional holiday. The EAT reversed this, holding that (unlike reg. 14(2) of the WTR 1998, where an employee is entitled to compensation for untaken holiday on termination of employment) an employer cannot have credit for overpaid holiday under the legislative framework.
• click here for the full transcript
Hill v Howard Chappel (HHJ Peter Clark, 20/3/02)
An employer is not entitled to deduct overpaid holiday from an employee's final salary payment, in the absence of a 'relevant agreement' under the Working Time Regulations 1998 authorising such a deduction.
Thus, on the facts, Mrs Hill had taken 15 days' holiday in the holiday year when, on a pro rata basis, she was only entitled to take 10 days. The employment tribunal, when awarding Mrs Hill her unpaid salary, gave credit to the employer for the 5 days' additional holiday. The EAT reversed this, holding that (unlike reg. 14(2) of the WTR 1998, where an employee is entitled to compensation for untaken holiday on termination of employment) an employer cannot have credit for overpaid holiday under the legislative framework.
• click here for the full transcript
Monday, 27 May 2002
Chancery Division: Pensionable Salary
The High Court has held (London Borough of Newham v Skingle & The Pensions Ombudsman), on an appeal from the Pensions Ombudsman, that pensionable salary for local government employees does not include overtime payments.
The point (which is summarised in the one sentence above) is short but important, as it applies to a wide range of local government and possibly, other public service, employees.
Click here to see the Decision.
The point (which is summarised in the one sentence above) is short but important, as it applies to a wide range of local government and possibly, other public service, employees.
Click here to see the Decision.
Friday, 17 May 2002
TUPE: Rossiter v Pendragon - Court of Appeal
According to a case summary issued by the Independent Council of Law Reporting, the Court of Appeal decided the appeal in Rossiter v Pendragon (and the associated case, Clarke v Air Foyle Ltd) last week. The transcript is not yet available.
The Court of Appeal has overturned the EAT decisions in both cases, and held that a change to employees' terms and conditions following a TUPE transfer does not automatically amount to a constructive dismissal - the employee still needs to establish a fundamental breach of his pre-transfer rights. Thus a transferee can vary terms in the same way the original employer might have been able to do, if such a variation would not have been a fundamental breach by the original employer.
I set out the full summary below (copyright ICLR)
An employee could not claim constructive dismissal on a transfer of undertaking where his working conditions had substantially changed to his detriment without showing a fundamental breach of contract by the employer
The Court of Appeal so stated when (i) allowing the appeal of Pendragon plc against the ruling of the Employment Appeal Tribunal [2001] ICR 1265 that its employee Mr Norman Rossiter had been constructively dismissed and (ii) allowing the appeal of Air Foyle Ltd against the decision of the Employment Appeal Tribunal on 3 October 2001 which, on a preliminary ruling, dismissed its appeal against an employment tribunal's decision that Mr Crosby-Clarke had been constructively dismissed.
The two conjoined appeals raised the same issue whether an employee employed on different terms on a transfer of undertaking could establish constructive dismissal by reason of substantial change in his work conditions to his detriment when the acts of the employer were not repudiatory or in breach of contract.
PETER GIBSON LJ said that it was quite clear from the language of reg 5(5) of the Transfer of Undertakings (Protection of Employment) Regulations 1981 ("TUPE") that no new right was thereby intended to be created . The regulation preserved the rights arising apart from TUPE and the only such right was that of an employee to resign when faced with repudiation of his contract by the employer. If there were a right to claim constructive dismissal if there had only been a substantial change in circumstances without breach of contract that would arise apart from not under TUPE.
The language of reg 5(5) was chosen to implement art 4(2) of the Directive and s 95(1)(c) of the Employment Rights Act 1996. Only conduct of an employer amounting to repudiation would entitle an employee to terminate a contract without notice.
The appeal tribunal in Rossiter's case[2001] ICR 1265,1275 erred in holding that s 95(1(c) should be construed in a way enabling an employee to claim constructive dismissal where there was no repudiatory conduct by the employer. The test in Western Excavating (ECC) Ltd v Sharp [1978] QB 761 still applied as much to a case involving a transfer of undertaking as when there was no transfer.
Jonathan Parker LJ and Sir Christopher Slade agreed.
The Court of Appeal has overturned the EAT decisions in both cases, and held that a change to employees' terms and conditions following a TUPE transfer does not automatically amount to a constructive dismissal - the employee still needs to establish a fundamental breach of his pre-transfer rights. Thus a transferee can vary terms in the same way the original employer might have been able to do, if such a variation would not have been a fundamental breach by the original employer.
I set out the full summary below (copyright ICLR)
An employee could not claim constructive dismissal on a transfer of undertaking where his working conditions had substantially changed to his detriment without showing a fundamental breach of contract by the employer
The Court of Appeal so stated when (i) allowing the appeal of Pendragon plc against the ruling of the Employment Appeal Tribunal [2001] ICR 1265 that its employee Mr Norman Rossiter had been constructively dismissed and (ii) allowing the appeal of Air Foyle Ltd against the decision of the Employment Appeal Tribunal on 3 October 2001 which, on a preliminary ruling, dismissed its appeal against an employment tribunal's decision that Mr Crosby-Clarke had been constructively dismissed.
The two conjoined appeals raised the same issue whether an employee employed on different terms on a transfer of undertaking could establish constructive dismissal by reason of substantial change in his work conditions to his detriment when the acts of the employer were not repudiatory or in breach of contract.
PETER GIBSON LJ said that it was quite clear from the language of reg 5(5) of the Transfer of Undertakings (Protection of Employment) Regulations 1981 ("TUPE") that no new right was thereby intended to be created . The regulation preserved the rights arising apart from TUPE and the only such right was that of an employee to resign when faced with repudiation of his contract by the employer. If there were a right to claim constructive dismissal if there had only been a substantial change in circumstances without breach of contract that would arise apart from not under TUPE.
The language of reg 5(5) was chosen to implement art 4(2) of the Directive and s 95(1)(c) of the Employment Rights Act 1996. Only conduct of an employer amounting to repudiation would entitle an employee to terminate a contract without notice.
The appeal tribunal in Rossiter's case[2001] ICR 1265,1275 erred in holding that s 95(1(c) should be construed in a way enabling an employee to claim constructive dismissal where there was no repudiatory conduct by the employer. The test in Western Excavating (ECC) Ltd v Sharp [1978] QB 761 still applied as much to a case involving a transfer of undertaking as when there was no transfer.
Jonathan Parker LJ and Sir Christopher Slade agreed.
Thursday, 16 May 2002
Employment Regulation: New Report
The Better Regulation Task Force (a part of the Cabinet Office) has issued a report calling for reforms to the system of implementing employment legislation, referring to the unreasonable demands the method of regulation imposes on small and medium size employers.
Its recommendations include:
• commencement dates for new legislation be grouped together, so that various Acts / SIs take effect on the same date (perhaps once or twice a year), rather than at scattered intervals during the year;
• further research on the effect of employment legislation: in particular, its indirect effects on unemployment rates and investment, and degrees of awareness / penetration amongst workers;
• 'stress tests' for new legislation, to see which sectors of industry it might have the most effect on;
• a free interactive CD-ROM on employment rights, to be given to all employers (and updated regularly - either over the net, or by post once a year)
• a free or subsidised ACAS mediation service for businesses with less than 50 employees;
• free access to ACAS seminars for employers with less than 5 employees.
Click here to see the Report (Adobe Acrobat required).
Its recommendations include:
• commencement dates for new legislation be grouped together, so that various Acts / SIs take effect on the same date (perhaps once or twice a year), rather than at scattered intervals during the year;
• further research on the effect of employment legislation: in particular, its indirect effects on unemployment rates and investment, and degrees of awareness / penetration amongst workers;
• 'stress tests' for new legislation, to see which sectors of industry it might have the most effect on;
• a free interactive CD-ROM on employment rights, to be given to all employers (and updated regularly - either over the net, or by post once a year)
• a free or subsidised ACAS mediation service for businesses with less than 50 employees;
• free access to ACAS seminars for employers with less than 5 employees.
Click here to see the Report (Adobe Acrobat required).
Asbestosis Case: House of Lords Decision
The House of Lords has just handed down its decision in Fairchild, the mesothelioma test case.
The issue was whether employees who had developed mesothelioma from inhalation of asbestosis could bring a claim against various previous employers, when it was not clear (and, on current medical knowledge, impossible to prove) which of several employers had been the employer at the time of inhalation of the asbestos.
The Court of Appeal had held that, because it could not be said on balance of probabilities whether a particular employer was responsible, the claims must fail against all employers.
The House of Lords has reversed this, and permitted the claims to succeed. The basis of their decision is not yet known (a press release has been issued, but the judgment is not publicly available). It should become available later today, probably on the House of Lords website at http://www.parliament.the-stationery-office.co.uk/pa/ld199697/ldjudgmt/ldjudgmt.htm
The issue was whether employees who had developed mesothelioma from inhalation of asbestosis could bring a claim against various previous employers, when it was not clear (and, on current medical knowledge, impossible to prove) which of several employers had been the employer at the time of inhalation of the asbestos.
The Court of Appeal had held that, because it could not be said on balance of probabilities whether a particular employer was responsible, the claims must fail against all employers.
The House of Lords has reversed this, and permitted the claims to succeed. The basis of their decision is not yet known (a press release has been issued, but the judgment is not publicly available). It should become available later today, probably on the House of Lords website at http://www.parliament.the-stationery-office.co.uk/pa/ld199697/ldjudgmt/ldjudgmt.htm
Thursday, 9 May 2002
Age Discrimination Bill 2002
The Age Discrimination (No. 2) Bill 2002 has been introduced to the House of Commons.
It contains the following provisions (applying to both employees and contract workers):
• making it unlawful to discriminate directly on grounds of age;
• making it unlawful to discriminate indirectly on grounds of age, unless objectively justified;
• making it an offence to specify an actual or preferred upper age limit in a job advertisement;
• making it unlawful to set a normal retirement age in contracts of employment, unless there is an objective justification (the example is given of a retirement age linked to an occupational pension scheme agreed between the parties)
• a defence where the age requirement is a genuine and determining occupational requirement
• imposing a duty on public authorities to promote age equality in employment practices;
• setting up an Age Equality Commission, to monitor implementation of the Act and work towards the elimination of age discrimination.
A reading of the Bill (it is a private member's bill) suggests it has been 'cut and pasted' from older discrimination legislation. For example:
• it refers throughout to 'industrial', rather than 'employment' tribunals;
• it does not contain any time limit for enforcement of rights (i.e. there is simply no reference to the normal 3-month time limit);
• however, it does use the more modern terminology for indirect discrimination, namely 'a provision, criterion or practice' rather than the older 'requirement or condition'.
Click here to see the Bill (Adobe Acrobat required).
It contains the following provisions (applying to both employees and contract workers):
• making it unlawful to discriminate directly on grounds of age;
• making it unlawful to discriminate indirectly on grounds of age, unless objectively justified;
• making it an offence to specify an actual or preferred upper age limit in a job advertisement;
• making it unlawful to set a normal retirement age in contracts of employment, unless there is an objective justification (the example is given of a retirement age linked to an occupational pension scheme agreed between the parties)
• a defence where the age requirement is a genuine and determining occupational requirement
• imposing a duty on public authorities to promote age equality in employment practices;
• setting up an Age Equality Commission, to monitor implementation of the Act and work towards the elimination of age discrimination.
A reading of the Bill (it is a private member's bill) suggests it has been 'cut and pasted' from older discrimination legislation. For example:
• it refers throughout to 'industrial', rather than 'employment' tribunals;
• it does not contain any time limit for enforcement of rights (i.e. there is simply no reference to the normal 3-month time limit);
• however, it does use the more modern terminology for indirect discrimination, namely 'a provision, criterion or practice' rather than the older 'requirement or condition'.
Click here to see the Bill (Adobe Acrobat required).
Wednesday, 1 May 2002
New EAT Decisions
These decisions have just been placed on the EAT website. They are currently unreported, but may be reported in due course.
Paggetti v Cobb (HHJ Peter Clark, 22/3/02)
An employee's compensatory award was calculated on the basis of his actual wage, which was £1.88 per hour. The EAT overturned this, holding that when calculating a compensatory award, a tribunal should never base it on less than the minimum wage (then £3.60ph) because, to do so, would be to disregard the National Minimum Wage Act 1988 and allow the employer to benefit from his breach of that Act. Accordingly, the compensatory award should be calculated based on an hourly rate of £3.60, not £1.80.
• click here for the full transcript
Brown v Tomlinsons Dairies (Mr Commissioner Howell QC, 10/4/02)
The employee was at risk of redundancy, but had not been dismissed. He wrote to the employer, asserting he had been dismissed, and refused to attend work. After several attempts to persuade him he had not been dismissed, the employer eventually treated the employee as having resigned. The EAT confirmed this was a dismissal within section 95 of the ERA 1996, by way of the employer accepting the employee's repudiatory breach (refusing to work) and thereby bringing the contract to an end. However, the dismissal was fair, primarily because there was little else the employer could do.
• click here for the full transcript
Paggetti v Cobb (HHJ Peter Clark, 22/3/02)
An employee's compensatory award was calculated on the basis of his actual wage, which was £1.88 per hour. The EAT overturned this, holding that when calculating a compensatory award, a tribunal should never base it on less than the minimum wage (then £3.60ph) because, to do so, would be to disregard the National Minimum Wage Act 1988 and allow the employer to benefit from his breach of that Act. Accordingly, the compensatory award should be calculated based on an hourly rate of £3.60, not £1.80.
• click here for the full transcript
Brown v Tomlinsons Dairies (Mr Commissioner Howell QC, 10/4/02)
The employee was at risk of redundancy, but had not been dismissed. He wrote to the employer, asserting he had been dismissed, and refused to attend work. After several attempts to persuade him he had not been dismissed, the employer eventually treated the employee as having resigned. The EAT confirmed this was a dismissal within section 95 of the ERA 1996, by way of the employer accepting the employee's repudiatory breach (refusing to work) and thereby bringing the contract to an end. However, the dismissal was fair, primarily because there was little else the employer could do.
• click here for the full transcript
Monday, 29 April 2002
Employment TaskForce Report
The Employment Tribunal System Taskforce, chaired by Janet Gaymer, has today published its report on reform of the employment tribunal system. The report was provided to the DTI and the Lord Chancellor.
The main recommendations are:
• establishing a high-level coordinating body to increase coherence amongst the regions, whose ambit would include IT strategy, research programmes, information for users, websites and complaint handling;
• greater emphasis on the prevention of disputes, including more involvement by ACAS;
• earlier disclosure of information by all parties, to help both sides understand if they have a case and enable better judicial case-handling techniques;
• improved infrastructure for ETs, including better IT links, appropriate resources for the workload, more training and more highly skilled administrative staff;
• generally more investment in the system
Other recommendations include:
• a review be undertaken into regulation of employment law advisers;
• a pilot scheme should be set up, piloting the concept of judicial assistants as used in the civil sector;
• the parties should be asked about their availability before a full hearing date is set;
• the time limit for the IT3 should be extended from 21 to 28 days - but should be enforced more rigorously;
• there should be better preparation for hearings before the case, including the chairman and lay members receiving papers in advance;
• the system of enforcing tribunal awards should be reviewed;
• a study should be undertaken to consider widening the jurisdiction of ETs to other employment-related claims;
• tribunal proceedings should be digitally recorded, so that a transcript may be produced in a cost-effective manner;
• the current register of applications should be terminated;
• stress counselling should be made available to those working in ETs.
Both a summary, and the full report, have been published on the internet.
The main recommendations are:
• establishing a high-level coordinating body to increase coherence amongst the regions, whose ambit would include IT strategy, research programmes, information for users, websites and complaint handling;
• greater emphasis on the prevention of disputes, including more involvement by ACAS;
• earlier disclosure of information by all parties, to help both sides understand if they have a case and enable better judicial case-handling techniques;
• improved infrastructure for ETs, including better IT links, appropriate resources for the workload, more training and more highly skilled administrative staff;
• generally more investment in the system
Other recommendations include:
• a review be undertaken into regulation of employment law advisers;
• a pilot scheme should be set up, piloting the concept of judicial assistants as used in the civil sector;
• the parties should be asked about their availability before a full hearing date is set;
• the time limit for the IT3 should be extended from 21 to 28 days - but should be enforced more rigorously;
• there should be better preparation for hearings before the case, including the chairman and lay members receiving papers in advance;
• the system of enforcing tribunal awards should be reviewed;
• a study should be undertaken to consider widening the jurisdiction of ETs to other employment-related claims;
• tribunal proceedings should be digitally recorded, so that a transcript may be produced in a cost-effective manner;
• the current register of applications should be terminated;
• stress counselling should be made available to those working in ETs.
Both a summary, and the full report, have been published on the internet.
UK in further breach of Working Time Directive
According to a press release just issued, the European Commission has upheld a complaint against the UK government, holding that the Working Time Regulations do not properly implement the EC Working Time Directive.
Amicus, the trade union, complained to the Commission that the WTR fail to implement the Directive because:
• under the Regulations, overtime hours on night shifts are excluded from the 48-hour working week limit, which contravenes the Directive; and,
• under the Regulations, people could volunteer to work additional hours which are unmeasured by the employer, thereby undermining the Directive.
According to the press release, the Commission has issued infringement proceedings against the UK, giving it two months to comply.
The government has already been forced to amend the Regulations, last year, on the basis that the 13-week qualifying period for holiday pay breached the Working Time Directive.
Amicus, the trade union, complained to the Commission that the WTR fail to implement the Directive because:
• under the Regulations, overtime hours on night shifts are excluded from the 48-hour working week limit, which contravenes the Directive; and,
• under the Regulations, people could volunteer to work additional hours which are unmeasured by the employer, thereby undermining the Directive.
According to the press release, the Commission has issued infringement proceedings against the UK, giving it two months to comply.
The government has already been forced to amend the Regulations, last year, on the basis that the 13-week qualifying period for holiday pay breached the Working Time Directive.
Monday, 22 April 2002
New TUPE Decision: RCO v Unison (C of A)
The decision of the Court of Appeal in RCO Support Services Ltd v UNISON (12th April 2002) is now available on the Court of Appeal website.
For details of the EAT's decision, see my bulletin dated 6th July 2000.
Facts
The Aintree Hospitals' NHS Trust decided to transfer much of the work from one hospital to a nearby hospital, three miles away. The issue was whether there was a transfer of undertakings in relation to the cleaning and catering support services (which were undertaken by different companies, one at each of the two hospitals).
The Decisions Below
Both the employment tribunal, and the EAT, held that a transfer of undertakings had taken place.
The Court of Appeal's Decision
The Court of Appeal upheld the decisions below, holding that a transfer had taken place.
Interestingly, Mummery LJ's judgment was supportive of the ECJ's decision in Suzen, indicating movement away from the 'let's all be rude about Suzen' attitude which has appeared in so many recent decisions.
He held:
"24. I agree that it has become clear from Suzen and later judgments that the Court of Justice now interprets the Directive as setting limits to its application in contracting out cases, which were not expressly identified in Spijkers or in Schmidt and other earlier judgments of the Court of Justice. In particular, the mere fact that the putative transferee carries on the same services as the putative transferor had done does not, by itself, support the conclusion that an entity retains its identity. It is not correct to treat that single circumstance as determinative in favour of a transfer. Indeed, there may be no scope for the application of the Directive in a case where, although the same labour-intensive activities are continued or the same services are supplied by a new contractor, none of the workforce has been taken on."
Mummery LJ then goes on to consider the position if a putative transferee deliberately refuses to take on incoming employees so as to avoid the application of the TUPE Regulations. He describes this as "circular" and "not the real point", emphasising that whether staff transfer is merely a factor.
• click here for the full transcript
For details of the EAT's decision, see my bulletin dated 6th July 2000.
Facts
The Aintree Hospitals' NHS Trust decided to transfer much of the work from one hospital to a nearby hospital, three miles away. The issue was whether there was a transfer of undertakings in relation to the cleaning and catering support services (which were undertaken by different companies, one at each of the two hospitals).
The Decisions Below
Both the employment tribunal, and the EAT, held that a transfer of undertakings had taken place.
The Court of Appeal's Decision
The Court of Appeal upheld the decisions below, holding that a transfer had taken place.
Interestingly, Mummery LJ's judgment was supportive of the ECJ's decision in Suzen, indicating movement away from the 'let's all be rude about Suzen' attitude which has appeared in so many recent decisions.
He held:
"24. I agree that it has become clear from Suzen and later judgments that the Court of Justice now interprets the Directive as setting limits to its application in contracting out cases, which were not expressly identified in Spijkers or in Schmidt and other earlier judgments of the Court of Justice. In particular, the mere fact that the putative transferee carries on the same services as the putative transferor had done does not, by itself, support the conclusion that an entity retains its identity. It is not correct to treat that single circumstance as determinative in favour of a transfer. Indeed, there may be no scope for the application of the Directive in a case where, although the same labour-intensive activities are continued or the same services are supplied by a new contractor, none of the workforce has been taken on."
Mummery LJ then goes on to consider the position if a putative transferee deliberately refuses to take on incoming employees so as to avoid the application of the TUPE Regulations. He describes this as "circular" and "not the real point", emphasising that whether staff transfer is merely a factor.
• click here for the full transcript
Friday, 19 April 2002
New Agency Worker Decision
Esso Petroleum v Jarvis [HHJ Pugsley, 18th January 2002]
Esso engaged a number of workers through an employment agency. The workers were paid by the agency, although the rates were set by Esso. They worked alongside Esso employees, were subject to the same lines of authority and under Esso's day-to-day control, sought authority for holidays from Esso, were subject to the same working policies, and received bonuses from Esso. By contrast, there was no grievance procedure or formal disciplinary procedure, and they were not members of the Esso pension scheme.
The employment tribunal decided that they were 'employees' of Esso, within the meaning of the ERA 1996 (and, although not stated in the decision, could presumably therefore claim unfair dismissal against Esso). The EAT overturned this, confirming that the absence of a contract between Esso and the workers meant that they were not capable of being 'employees', since there was no contract in existence which could be said to amount to a contract of employment.
This case is a further example of the lack of employment protection given to agency workers (albeit it should be extended if and when the EC Agency Workers Directive is implemented).
• click here for the Esso decision
Esso engaged a number of workers through an employment agency. The workers were paid by the agency, although the rates were set by Esso. They worked alongside Esso employees, were subject to the same lines of authority and under Esso's day-to-day control, sought authority for holidays from Esso, were subject to the same working policies, and received bonuses from Esso. By contrast, there was no grievance procedure or formal disciplinary procedure, and they were not members of the Esso pension scheme.
The employment tribunal decided that they were 'employees' of Esso, within the meaning of the ERA 1996 (and, although not stated in the decision, could presumably therefore claim unfair dismissal against Esso). The EAT overturned this, confirming that the absence of a contract between Esso and the workers meant that they were not capable of being 'employees', since there was no contract in existence which could be said to amount to a contract of employment.
This case is a further example of the lack of employment protection given to agency workers (albeit it should be extended if and when the EC Agency Workers Directive is implemented).
• click here for the Esso decision
Thursday, 11 April 2002
Government launches new 'Fitness Desk Aid' for GPs
The government has launched a new 'desk aid' for GPs to help them decide whether a patient is fit for work.
It contains the following guidelines:
• the nature of the patients medical condition and how long the condition is expected to last
• the functional limitations which result from the patients condition, particularly in relation to the type of tasks they actually perform at work
• any reasonable adjustments which might enable the patient to continue working - in relation to the workplace it is worth noting that under the Disability Discrimination Act 1995 an employer may be required to make reasonable adjustments for an employee with a long term disability
• any appropriate clinical guidelines - for example the Royal College of General Practitioners has produced clinical guidelines on the management of acute low back pain
• clinical management of the condition which is in the patients best interest regarding work fitness
It continues:
"you should always bear in mind that a patient may not be well served in the longer term by medical advice to refrain from work, if more appropriate clinical management would allow them to stay in work or return to work."
The guide is available here.
It contains the following guidelines:
• the nature of the patients medical condition and how long the condition is expected to last
• the functional limitations which result from the patients condition, particularly in relation to the type of tasks they actually perform at work
• any reasonable adjustments which might enable the patient to continue working - in relation to the workplace it is worth noting that under the Disability Discrimination Act 1995 an employer may be required to make reasonable adjustments for an employee with a long term disability
• any appropriate clinical guidelines - for example the Royal College of General Practitioners has produced clinical guidelines on the management of acute low back pain
• clinical management of the condition which is in the patients best interest regarding work fitness
It continues:
"you should always bear in mind that a patient may not be well served in the longer term by medical advice to refrain from work, if more appropriate clinical management would allow them to stay in work or return to work."
The guide is available here.
Wednesday, 10 April 2002
Government promises to end Age Discrimination
Ian McCartney, Minister for Work and Pensions, has today set out the government's commitment to defeating age discrimination in employment, together with all other forms of ageism.
The pledge is for such action to occur over the next 20 years - perhaps not the most ambitious of targets given the EC Equal Treatment Framework Directive requires member states to implement age discrimination legislation by December 2006.
In the style of the great political orators, Ian McCartney said: "Older people are not the world's problem, they are part of the solution to the world's problem... Age discrimination is wrong and the time has come to bin it."
The pledge is for such action to occur over the next 20 years - perhaps not the most ambitious of targets given the EC Equal Treatment Framework Directive requires member states to implement age discrimination legislation by December 2006.
In the style of the great political orators, Ian McCartney said: "Older people are not the world's problem, they are part of the solution to the world's problem... Age discrimination is wrong and the time has come to bin it."
Tuesday, 9 April 2002
New EAT Decisions
These cases are unreported (although some may be reported in due course). The transcripts were recently posted on the EAT website
Barlow v PE Jones Contractors Ltd [Mr Recorder Langstaff QC, 4th March 2002]
A potentially important case on the definition of 'worker', where the Respondent had inserted clauses into the contract of employment designed to negative any employment relationship. Many of the clauses were clearly gleaned from previous cases and the contract was a textbook example of the right things to include so as to prevent an employer/employee relationship arising. The employees claimed paid holiday under the Working Time Regulations, and argued that many of these clauses were intended to contract out of the legislation and were therefore void. The EAT did not consider it necessary to deal with this point, instead preferring to allow the appeal on the grounds that the employment tribunal seemed to have applied the test for who is an 'employee' rather than who is a 'worker'.
• click here for the Barlow decision
Curr v Marks & Spencers plc [HHJ Wilkie, 6th March 2002]
An employee had a four year break in her employment, pursuant to the Marks & Spencers' Child Break scheme. Whilst it was clear that there was no governing contract of employment during those four years (so as to enable continuity of employment to continue accruing), the majority of the EAT held that she was "absent from work in circumstances such that...[she] is regarded as continuing in the employment of her employer for any reason" under ERA 1996, s212. Accordingly her continuity of employment remained unbroken during the four year gap and she was entitled to a redundancy payment based on her accrued continuity of employment dating back to 1973.
• click here for the Curr decision
Miller Bros. v Johnson [Mr Recorder Langstaff QC, 14th March 2002]
An employment tribunal has no jurisdiction to hear breach of contract claims where the breach occurred after termination of employment, even if the contract (being a compromise agreement) arose because of the termination of employment.
• click here for the Miller Bros. decision
Barlow v PE Jones Contractors Ltd [Mr Recorder Langstaff QC, 4th March 2002]
A potentially important case on the definition of 'worker', where the Respondent had inserted clauses into the contract of employment designed to negative any employment relationship. Many of the clauses were clearly gleaned from previous cases and the contract was a textbook example of the right things to include so as to prevent an employer/employee relationship arising. The employees claimed paid holiday under the Working Time Regulations, and argued that many of these clauses were intended to contract out of the legislation and were therefore void. The EAT did not consider it necessary to deal with this point, instead preferring to allow the appeal on the grounds that the employment tribunal seemed to have applied the test for who is an 'employee' rather than who is a 'worker'.
• click here for the Barlow decision
Curr v Marks & Spencers plc [HHJ Wilkie, 6th March 2002]
An employee had a four year break in her employment, pursuant to the Marks & Spencers' Child Break scheme. Whilst it was clear that there was no governing contract of employment during those four years (so as to enable continuity of employment to continue accruing), the majority of the EAT held that she was "absent from work in circumstances such that...[she] is regarded as continuing in the employment of her employer for any reason" under ERA 1996, s212. Accordingly her continuity of employment remained unbroken during the four year gap and she was entitled to a redundancy payment based on her accrued continuity of employment dating back to 1973.
• click here for the Curr decision
Miller Bros. v Johnson [Mr Recorder Langstaff QC, 14th March 2002]
An employment tribunal has no jurisdiction to hear breach of contract claims where the breach occurred after termination of employment, even if the contract (being a compromise agreement) arose because of the termination of employment.
• click here for the Miller Bros. decision
Thursday, 4 April 2002
EC Information and Consultation Directive
The final text of the Information and Consultation Directive was published in the Official Journal of the European Communities on 23rd March 2002.
The Directive gives employees a right to be:
• informed about the business's economic situation,
• informed and consulted about employment prospects (particularly where there is a threat to employment); and,
• informed and consulted about about decisions likely to lead to substantial changes in work organisation or contractual relations (including redundancies and transfers).
Information and consultation has to take place at an appropriate time,. and with the relevant level of management. It is expected it will take place via a union or appropriate employee representatives (although this is yet to be determined by the UK legislation). The representatives will be entitled to meet the employer, submit their views and receive a reasoned response.
Employers may withhold information when disclosure would seriously harm the company or be prejudicial to it, or they may require that it be kept confidential by the employee representatives to whom it is disclosed.
The U.K. has three years to implement the Directive, i.e. until 23rd March 2005, by when it must apply to all businesses with over 150 employees. By March 2007 it must be extended to all businesses with over 100 employees, and by March 2008 it must apply to all businesses with 50 or more employees. The Directive does not apply to businesses with less than 50 employees. Businesses with 50+ employees account for about 75% of UK employees
The Directive gives employees a right to be:
• informed about the business's economic situation,
• informed and consulted about employment prospects (particularly where there is a threat to employment); and,
• informed and consulted about about decisions likely to lead to substantial changes in work organisation or contractual relations (including redundancies and transfers).
Information and consultation has to take place at an appropriate time,. and with the relevant level of management. It is expected it will take place via a union or appropriate employee representatives (although this is yet to be determined by the UK legislation). The representatives will be entitled to meet the employer, submit their views and receive a reasoned response.
Employers may withhold information when disclosure would seriously harm the company or be prejudicial to it, or they may require that it be kept confidential by the employee representatives to whom it is disclosed.
The U.K. has three years to implement the Directive, i.e. until 23rd March 2005, by when it must apply to all businesses with over 150 employees. By March 2007 it must be extended to all businesses with over 100 employees, and by March 2008 it must apply to all businesses with 50 or more employees. The Directive does not apply to businesses with less than 50 employees. Businesses with 50+ employees account for about 75% of UK employees
New EAT Decisions
These cases are unreported (although some may be reported in due course). The transcripts were recently posted on the EAT website
Rotherham Reboring Services Ltd v Maycock [HHJ Wilkie, 6th Feb 2002]
The employment tribunal disapplied ERA 1996, s109 (upper qualifying age for unfair dismissal) and allowed a 65-year old to claim unfair dismissal. Time for appealing that decision expired (the employer was unrepresented and unaware of Rutherford v Harvest Town Circle). At a subsequent remedies hearing, the tribunal disapplied s119(4) on the same basis. The employer appealed the basic award of £6,600, relying on Rutherford. The EAT held that the employer was issue estopped from bringing the appeal, since the first decision had not been appealed and the tribunal had made an effective finding that a 65-year old was entitled to full compensation for unfair dismissal.
• click here for the Rotherham decision
MSF v Refuge Assurance plc [Lindsay P., 15th Feb 2002]
TULR(C)A 1993, s188 provides that consultations must begin in good time before multiple redundancies, when an employer is proposing to dismiss more than 20 employees. This does not mean when the employer first thinks about redundancies, or contemplates redundancies as a contingency plan. For deciding what is meant by 'in good time', an employer should consider the probable date of redundancies, decide how long will be required for effective, good-faith consultation, and calculate the date when consultation should start from then.
• click here for the MSF decision
Brown v Kigass Aero [Lindsay P., 25th Feb 2002]
This case was summarised in the bulletin dated 5th March 2002, namely that workers on long-term sick absence continue to accrue holiday pay. The transcript is now available.
• click here for the Kigass Aero decision
Rotherham Reboring Services Ltd v Maycock [HHJ Wilkie, 6th Feb 2002]
The employment tribunal disapplied ERA 1996, s109 (upper qualifying age for unfair dismissal) and allowed a 65-year old to claim unfair dismissal. Time for appealing that decision expired (the employer was unrepresented and unaware of Rutherford v Harvest Town Circle). At a subsequent remedies hearing, the tribunal disapplied s119(4) on the same basis. The employer appealed the basic award of £6,600, relying on Rutherford. The EAT held that the employer was issue estopped from bringing the appeal, since the first decision had not been appealed and the tribunal had made an effective finding that a 65-year old was entitled to full compensation for unfair dismissal.
• click here for the Rotherham decision
MSF v Refuge Assurance plc [Lindsay P., 15th Feb 2002]
TULR(C)A 1993, s188 provides that consultations must begin in good time before multiple redundancies, when an employer is proposing to dismiss more than 20 employees. This does not mean when the employer first thinks about redundancies, or contemplates redundancies as a contingency plan. For deciding what is meant by 'in good time', an employer should consider the probable date of redundancies, decide how long will be required for effective, good-faith consultation, and calculate the date when consultation should start from then.
• click here for the MSF decision
Brown v Kigass Aero [Lindsay P., 25th Feb 2002]
This case was summarised in the bulletin dated 5th March 2002, namely that workers on long-term sick absence continue to accrue holiday pay. The transcript is now available.
• click here for the Kigass Aero decision
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