Sex Discrimination Regulations

[Thanks to Charles Piggott of Mills & Reeve for telling me about these Regulations]

The Sex Discrimination Act 1975 (Amendment) Regulations 2003 have just been published, and come into force on Saturday, 19th July 2003. Unlike the correspondence Race and Equal Pay Regulations, very little seems to have been written about these amendments.

They make two very important changes, namely:

• at long last, reversing the rule in Liversidge, i.e. providing that chief constables of police forces will be vicariously liable for sex discrimination committed by one police officer against another;
• prohibiting discrimination after the end of the employment relationship, provided the act of discrimination arises out of and is closely connected to the employment relationship. This partly implements the House of Lord's decision in Relaxion Group v Rhys-Harper last month. The effect is that, for example, failures to provide a reference (or bad references on grounds of gender) is capable of amounting to direct discrimination (avoiding the need to bring a difficult claim of victimisation).

ACAS Booklet - Pay Systems

ACAS has just published a new booklet setting out how different pay systems work, and giving guidance on how businesses should introduce new, and modify existing, pay systems.

For a subject where a first reaction might be "isn't it obvious?", the booklet makes enlightening reading.

Sex Discriminations Regulations

[Thanks to Charles Piggott of Mills & Reeve for telling me about these Regulations]

The Sex Discrimination Act 1975 (Amendment) Regulations 2003 have just been published, and come into force on Saturday, 19th July 2003. Unlike the correspondence Race and Equal Pay Regulations, very little seems to have been written about these amendments.

They make two very important changes, namely:

* at long last, reversing the rule in Liversidge, i.e. providing that chief constables of police forces will be vicariously liable for sex discrimination committed by one police officer against another;
* prohibiting discrimination after the end of the employment relationship, provided the act of discrimination arises out of and is closely connected to the employment relationship. This partly implements the House of Lord's decision in Relaxion Group v Rhys-Harper last month. The effect is that, for example, failures to provide a reference (or bad references on grounds of gender) is capable of amounting to direct discrimination (avoiding the need to bring a difficult claim of victimisation).

The Sex Discrimination Act 1975 (Amendment) Regulations 2003

EAT Comments on Costs

The following decisions have been placed on the EAT website recently.

Billany v Knutsford Conservative Club (HHJ Birtles, 8th July 2003)

An decision dealing with the 'employee / self-employed' distinction.

Of interest is the EAT dealing with an application for costs. It stated:

"Neither do we consider that the Appellant’s refusal of the Respondent’s offer to settle the appeal for £500 is itself unreasonable. Although the amount of compensation is a material factor for us to take into account, the case also involved the issue of whether or not the Appellant had been unfairly dismissed."
Which seems to be further support for the increasing common argument that Calderbank letters can be taken into account when deciding whether to award costs in tribunals.

For a summary on the current status of Calderbank letters in tribunals, send a blank Email to calderbank.article@danielbarnett.co.uk. You will receive an automatic reply, so please do not use that address if you want me to read your message.

Statutory Dispute Resolution

The DTI has published the first draft of Regulations on the forthcoming mandatory disciplinary and grievance procedures introduced by the Employment Act 2002. They are due to come into force on 1st October 2004.

For a summary of the relevant provisions of the Act, see 'Compulsory Dispute Resolution' [2002] 9 ELA Briefing 139.

The consultation document and draft Regulations are available at http://www.dti.gov.uk/er/individual/DRcondoc.pdf.

The draft Regulations make fairly horrendous reading, and seem to complicate rather than simplify disciplinary and grievance procedures for employers and employees.. A very loose summary (as they are full of conditions, exceptions and caveats) is:

• the short-form 'modified procedure' for disciplinary proceedings will apply if (a) the employee is guilty of gross misconduct (note: as presently drafted, reasonable grounds for belief in gross misconduct is insufficient - there has to have been actual gross misconduct), or (b) the dismissal is for reasons beyond the employer's control (I suspect this means pressure from third parties to dismiss);
• the short-form 'modified procedure' for grievance hearings will apply if the employment has terminated and both parties agree in writing to follow the modified procedure rather than the standard procedure;
• the disciplinary and grievance procedures do not apply if one party believes compliance would result in a significant threat to person or property, or if one party to the employment contract has been harassing the other (note: this rather drives a coach and horses through the requirement to use the grievance procedure in cases of s#ex, race or disability harassment, although there have been arguments raised that this exception is necessary to comply with EU laws);
• importantly, if any party fails to comply with a step in the procedure, it discharges the other party from continuing with the procedures. There is an exception where the employee has failed to attend a meeting for a reason which was not foreseen when the meeting was arranged;
• an extension of time for presentation of claims to the tribunal, by up to three months, when certain going through certain statutory procedures.

Responses to the consultation paper are due by 29th October 2003. I reproduce below the executive summary from the beginning of the consultation document, and the questions for consultation.

Consulting on Consultation

[An advertisement for an employment law LLM at Middlesex University Business School appears below]

The government has issued its consultation document on the draft Regulations implementing the EU Information and Consultation Directive.

The Regulations will apply to all businesses with more than 50 employees. If 10% of employees request it, the company must set up a workforce committee enabling full information and consultation with the workforce.

The company must then provide information to, and consult with, the committee on matters relating to the development of the undertaking, changes in employment patterns (particularly if there is a threat to employment) and decisions likely to lead to substantial changes in work organisation or contractual relations, such as changes to terms and conditions, TUPE transfers or collective redundancies.

The sanctions, though, are small. Employees can apply to the CAC if the employer has failed to comply with the Regulations. If the CAC orders the employer to take steps to remedy the position, and the employer fails to comply with the CAC's order, the complainant can apply to the Employment Appeal Tribunal which can impose a fine of up to £75,000 (irrespective of the number of employees affected). This is unlikely to be a sufficient deterrent to large companies to force them to comply with the information and consultation obligations on large or sensitive issues.

Neither the CAC nor the EAT will have power to reverse or suspend any decisions or actions taken by the employer whilst in breach of its consultation obligations.

The consultation period closes on 7th November. The draft Regulations are appended at the back of the Consultation Document.

The following decisions have been placed on the EAT website in the last 24 hours.

Grattan plc v Hussain (HHJ Burke, 1st July 2003)

An important decision on conduct dismissals. The EAT emphasises the test is not whether further investigation might reasonably have been carried out by the employer, but whether the investigation which had been carried out could be regarded by a reasonable employer as adequate. It emphasises the decision in Sainsbury's Supermarkets v Hitt, which applies the 'range of reasonable responses' test to the investigation process as well as to the ultimate decision.

Stansbury v Datapulse plc (Wall J., 8th May 2003)

An unusually interesting case to read, in which it seems (although the EAT carefully avoided making findings of fact) that a wing member had been drunk during part of the employment tribunal hearing, had fallen asleep and had made disparaging remarks about the chairman to the parties when passing them in the corridor.

The EAT held, largely because the decision was (a) unanimous, (b) reserved, and (c) not substantively challenged that even if the Appellant's allegations (which were supported by some significant evidence) were upheld, it would not mean that he had not received a fair trial under article 6 of the ECHR. His appeal was accordingly dismissed.

Time Off for Public Duties

The Employment Appeal Tribunal, in Riley-Williams v Argos Ltd, gives guidance for tribunals when deciding whether or not a dismissal is automatically unfair for not permitting an employee to take reasonable time off to sit as a magistrate.

The main points to draw from the decision are:

• tribunals should not consider whether the employer prevented an employee from taking time off, but the extent to which the employer permitted the employee to take time off;

• in deciding what is reasonable, the tribunal must balance the factors listed in section 50(4) of the Employment Rights Act 1996. They are mandatory factors.

• time off for public duties is in a different category to time off for union activities, or time off for personal reasons (such as maternity or parental leave). Thus it is irrelevant to take account of the employer's compassionate leave policy as a factor in determining how much time is reasonable - there is a wider public interest involved for employees who want time off to sit as a magistrate;

• the test of reasonableness is an objective one, balancing out the interests of the employer, the employee and the public. It is incorrect to apply the 'range of reasonable responses' test.

Age Discrimination Consultation

A consultation paper seeking views on legislation to prohibit age discrimination has been published by the DTI.

The paper, entitled 'Age Matters', seeks views on:

• the abolition of employers' mandatory retirement ages (dismissal at a given age) unless employers can objectively justify them;
• the possibility of a default retirement age of 70, at which employers could retire employees without having to justify dismissal on objective grounds;
• proposed legitimate aims which employers, exceptionally, could use to help justify the retention of a small number of age-related practices; and
• changes to the legislation regarding unfair dismissal and redundancy.
The consultation will last until 20th October 2003 and the government intends to enact the legislation (which will take the form of Regulations) by the end of 2004, to give businesses a clear two years to change policies before they commence at the end of 2006.

Lawal: House of Lords Decision

I have just been told by John Bowers QC of Littleton Chambers that the House of Lords has overturned the Court of Appeal's decision in Lawal v Northen Spirit.

This means that the well-known employment QCs who sit as recorders in the EAT are no longer allowed to do so (unless they give up appearing as advocates in the EAT), due to the risk that they lay members with whom they sit will be influenced into confusing their status as advocate with judge.

The transcript is not yet on the House of Lords website: I will post a fuller summary once it is placed up there. I also understand judgment in MacDonald v Ministry of Defence (whether sexual orientation is sex discrimination under the SDA 1975) and Pearce v Mayfield (the same issue) are due for judgment today.

Lawal v Northern Spirit Ltd

Further to my earlier Email, the judgment is now available.

It is a very short judgment. The House of Lords holds that there is a real possibility of bias where a Queen's Counsel appears as representative in front of a division of the EAT where he has previously sat as part-time judge with one or both wing members.

At paragraph 23, the House of Lords state:

"...Like Pill LJ in the Court of Appeal we consider that the present practice in the EAT tends to undermine public confidence in the system. It should be discontinued. It follows that the present practice in the EAT should be assimilated to that in the Employment Tribunal by introducing a restriction on part-time judges appearing as counsel before a panel of the EAT consisting of one or two lay members with whom they had previously sat."

Homosexuals and the SDA 1975

The House of Lords has handed down its decision in the cases of MacDonald v Advocate General for Scotland and Pearce v Mayfield School.

The House of Lords resolved the two competing arguments as to whether homosexuals fall within the Sex Discrimination Act 1975. In five distinct judgments, the five Law Lords were unanimous in dismissing the appeals.

The argument in favour was that if an employer dismisses a male who is sexually attracted to men (ie a homosexual), but would not dismiss a female who is sexually attracted to men (ie a heterosexual), the man has been treated less favourably than the woman and so has been discriminated against on grounds of gender.

The contrary argument was that the two are not in the same position, i.e. there are material differences between the man and the woman. Following the approach in Shamoon, the appropriate comparator would not be woman who was attracted to people of the opposite gender, but a woman who was attracted to someone of the same gender.

The House of Lords unanimously preferred the latter argument, holding that homosexuals are not protected by the provisions of the SDA 1975. If somebody is dismissed because they are homosexual, this is gender-neutral treatment by the employer provided it applies to both homosexual men and homosexual women. The appropriate comparator for a homosexual man is a homosexual woman.

Of just as much importance as the ratio of the case is the fact that the House of Lords stated that Burton v De Vere Hotels (the 'Bernard Manning' case) was wrongly decided. The House of Lords state that whilst an employer's failure to prevent third parties committing acts of sexual/racial harassment might amount to discrimination by the employer, it will only do so if the employer failed to take such steps because of the employee's sex/race. This has significant ramifications for discrimination claims generally, and also for the Liversidge cases where police constables are bringing sex discrimination claims against their chief constables.

Amendments to Race Relations Act

The Race Relations Act 1976 (Amendment) Regulations 2003 have been laid before parliament.

If passed, they are due to come into force on 19th July 2003. The amendments are required under the EC Racial Treatment Directive of July 2000 which required all countries to amend domestic legislation by - guess when - 19th July 2003.

The main changes are:
• setting out a new definition of indirect discrimination, bringing it into line with the definition under the Sex Discrimination Act 1975;

• creating a new definition of harassment and making harassment an express offence;

• introducing a new defence where race is a "genuine and determining requirement" for the job

• statutory reversal of the burden of proof, in line with s63A of the SDA 1975, so that if an Applicant proves a prima facie case of indirect discrimination, the burden shifts to the Respondent to prove that it was not racially discriminatory

New EAT Decisions

Mansi & Mansi v Straw (HHJ Birtles, 20/5/03)

A short case which is authority for the proposition that tribunals are not obliged to make an award of compensation under regulation 11 of TUPE for failure to consult with affected employees. It is lawful to make a nil award.

________________________________________

X v Y (HHJ Peter Clark, 11/6/03)

The Applicant, a male adult, worked with young people on probation. Whilst off duty, he "pulled into a lay-by where there was a transport café and went to the toilet. There he engaged in consensual sexual activity with a man of about his age whom he had never met before". He was arrested and accepted a caution for gross indecency. He lied to the police about what he did for a job (not revealing he worked with young people) and sought to withhold the fact of the conviction from his employers. When they discovered it, they dismissed him - not for the underlying offence but for lying to the police and placing the employer at risk of embarrassing publicity.

The tribunal found the dismissal was fair. The Applicant appealed on the basis that the tribunal had failed to take into account article 8 of the Human Rights Act 1998, namely a right to respect for his "private and family life".

The EAT held that article 8 only protects acts that are "private". They held:

"We think that the offence known as ‘cottaging’ falls on the other side of that dividing line. The offence here took place in toilets to which the public had access. The activities in which the Applicant engaged were ‘genuinely’ in public, to paraphrase the Court in ADT."

Accordingly article 8 was immaterial and the tribunal's failure to consider it was not an error of law.

________________________________________

Emms v UCATT (HHJ Ansell, 28/3/03)

An entirely uninteresting appeal against a tribunal's refusal to grant a costs warning. It is, however, worth a mention because:

(a) the Appellant's representative was 'Mr A Scargill' of the National Union of Mineworkers; and,

(b) costs were ordered against the Appellant on the grounds the appeal was 'unnecessary'.
Of course, it could be said it was just as unnecessary for me to report this case. But I couldn't resist it!

Data Protection Code Part 3: Monitoring At Work

The long-awaited Part 3 of the Data Protection Code on Employment Practices, dealing with Monitoring at Work, has been issued.

The four parts are:

Part 1 - Recruitment and Training (see bulletin 14/3/02)
Part 2 - Record Management (see bulletin 3/9/02)
Part 3 - Monitoring At Work (today)
Part 4 - Medical Records (forthcoming)

The Code is 55 pages long. The Supplementary Guidance is a further 49 pages - giving 104 pages in total. Helpfully, the key sections and summaries have been highlighted in a gray colour which does prevents printing and which makes them almost impossible to read on the screen.

In summary, the Code provides:

• employers can monitor workers when the advantage to the business outweighs the intrusion into the workers' affairs;
• employers should normally carry out an impact assessment before monitoring, weighing up the advantage v intrusion equation;
• workers should be told if they are being monitored;
• information discovered through monitoring should normally only be used for the purpose for which the monitoring was carried out;
• the information discovered should be kept secure, which may mean only letting one or two people have access to it
• employers should be careful when monitoring personal communications such as Emails which are clearly personal
• employers should not undertake covert monitoring except in the rarest circumstances where it is used for the prevention or detection of crime, it has been authorised at the highest level of the business, and where there is a risk that notifying workers of the monitoring would frustrate the purpose of the monitoring.
Why does that need 104 pages? Answers on a postcard, please.

New EAT Decisions

[A job advertisement for Thomas Eggar, Horsham, appears below]

The following decisions of the Employment Appeal Tribunal have been placed on the EAT website today.

Ogilvie v Neyrfor-Weir Ltd (Burton P., 15/5/03)

An interesting case where an oil executive was told he had to go abroad over the forthcoming bank holiday weekend, when he was expecting to attend his sister-in-law's engagement party. He objected to the short notice, and his superior told him in a heated exchange (with the door open) that he was a "fucking cunt" and would be dismissed if he did not miss the engagement party and travel abroad. Mr Ogilvie resigned and claimed constructive dismissal. The tribunal held that the employer's conduct did not amount to a constructive dismissal.

The EAT's decision (substituting a finding of unfair dismissal) is of interest for two reasons:

First, the Appellant sought to introduce a new ground of appeal at the hearing. In line with Miriki v General Council of the Bar (see bulletin of 28/12/01), the EAT refused permission to amend. Burton P. stated that it was not appropriate to introduce new grounds of appeal "even if they are one or two days late" and that "it is a matter of importance that, save in exceptional circumstances, amendments to Notices of Appeal should not be allowed out of time" (para 18). If followed, this would seem to rule out the very common practice of lodging vague grounds of appeal, so as to meet the 42-day time limit, and then substituting detailed grounds at the preliminary hearing stage.

Second, the EAT made the point that words (such as "fucking cunt") that might be acceptable in the heat of a moment on an oil rig are not necessarily acceptable in the boardroom or the office of a senior oil company executive. The tribunal was wrong to adopt a blanket approach to the use of profanity in particular industries.


Grant v BSS Group (Mr Commissioner Howell, 13/3/03)

This is authority for the proposition that the failure to undertake identical or similar levels of consultation with the entire redundancy pool, even after provisionally selecting one person from the pool for redundancy, renders the dismissal unfair.

This is an important point: it is common practice for lawyers / HR advisors to recommend that individual consultation need take place only with those who have been provisionally selected for redundancy following a matrix selection process. In this case, the EAT stated that the failure to consult with all of the pool - even the one who was not provisionally selected for redundancy - made the dismissal unfair.

The facts of the case dealt with a pool of two employees. I suspect that the case may be distinguished in situations where there is a larger selection pool. Certainly lawyers and employers may need to re-think their standard approach to redundancy consultation in the light of this decision.

New Archive Service

I have put together an archive for these bulletins. To access it, visit www.danielbarnett.co.uk/archive-index.html

It is possible that excessive demand when this bulletin arrives may mean you cannot access the page (and, yes, sometimes I do live in the real world!). If that happens, please try again later.

Dunnachie

As promised in my bulletin of 15th May, I now enclose the link for the Dunnachie v Kingston upon Hull City Council decision. There was also a summary of it in this morning's Times Law Reports.

The bulletin of 15th May is reproduced below.

Correction to Previous Bulletin

In my bulletin of 23rd May 2003 ('Compromise Agreements - New Approach by Inland Revenue', reproduced below), I stated that the Revenue's new approach to compromise agreements might be out of date because of new wording in the Income Tax (Earning and Pensions) Act 2003.

That created a flurry of protest from over 100 people (seriously!), all of whom told me they thought I was wrong. So I've looked at it again, and I agree! Irrespective of whether the Revenue's approach is lawful (which has, as far as I am aware, not yet been tested), the different wording in the new Act would not seem to affect the legality of its approach.

Unfair Dismissal - Reasonable Investigation

The Court of Appeal has handed down its decision in The Post Office (Consignia plc) v Burkett.

It is authority for the proposition that tribunals, when deciding whether an employer had reasonable grounds for its belief in misconduct, must set out and analyse the facts as found by the employer at the time of the dismissal (assuming the employer undertook a reasonable investigation).

It is an error of law to set out facts as found by the tribunal, unless a clear distinction is drawn between what the tribunal decides occurred, and what the tribunal decides the employer thought occurred.

Mr Burkett was dismissed for deliberately overfilling a Post Office van with oil, causing an explosion. The tribunal found that there was no evidence to support the fact that he had overfilled it deliberately and held the dismissal to be unfair. The Court of Appeal (after the EAT dismissed the original appeal) allowed the appeal on the grounds that the tribunal had substituted its view, whereas it should have looked at the facts that the Post Office had found after the Post Office's original disciplinary investigation, and decided whether those grounds for belief in misconduct were reasonable.