Disability Discrimination - Court of Appeal

The Court of Appeal has, today, handed down its judgment in Nottinghamshire County Council v Meikle, dealing with aspects of the Disability Discrimination Act 1995.

Upholding the EAT's decision (HHJ Ansell), it held:

• that in a constructive dismissal case, the employee's resignation need only be "in part" because of the employer's breach of contract: it need not be the 'effective case' (para. 33). This is not particularly new, although Keene LJ's analysis makes interesting reading (paras. 32-33);
• the word 'dismissal' in s4(2)(d) of the Disability Discrimination Act 1995 covers constructive dismissals. The EAT's decision in Commissioner of Police for the Metropolis v Harley [2001] ICR 927, that a constructive dismissal does not fall within the definition of 'dismissal' under the Act, was wrongly decided (paras. 41-52). As a result, the three month time limit starts running from the date of the resignation, not the date of the repudiatory conduct giving rise to the resignation (para. 53);
• the duty to make reasonable adjustments includes a duty to consider paying employees during sick absence periods (even if they are only contractually entitled to reduced pay or SSP). Section 6(11) of the DDA 1995, which excludes (amongst other things) "schemes or arrangements...in respect of...(c) accident, injury or invalidity" from the duty to make reasonable adjustments applies to insurance schemes, not to sickness provisions in the contract of employment.

Territorial Jurisdiction

Hot on the heels of Burton P.'s judgment on territorial jurisdiction in discrimination claims (see bulletin 29/6/04) come a series of four conjoined appeals before the EAT (HHJ Peter Clark) dealing with territorial jurisdiction in unfair dismissal and breach of contract claims.

The EAT, in SSAFA Forces Help v McClymont (& conjoined appeals), adopted the test laid down by the Court of Appeal in Jackson v Ghost earlier this year - i.e. 'is the employment in Great Britain?'. The difficulty, fairly obviously, involves deciding which side of the line many cases fall on. The EAT said the process was similar to deciding whether someone is an employee or self-employed, i.e. weigh up all the factors and decide which side of the line the case falls on (para. 19).

In the first two cases, which the EAT thought were straightforward, it held:

• employment of UK national by Cyprus company which did not carry on business in the UK. He worked at all relevant times in Nigeria. Held (on concession) this was not employment in Great Britain.
• UK national employed by a charity registered in the UK. She was appointed to a job in Germany and worked wholly in Germany until her resignation. She was paid partly in sterling and partly in German marks, and paid UK national insurance. Held this was not employment in Great Britain.

However, the EAT thought the other two cases were more difficult, and remitted them to the tribunal to reconsider in the light of the guidance in Jackson v Ghost.

As to breach of contract jurisdiction, the EAT considered the occasions when the civil courts had jurisdiction to determine a breach of contract claim (CPR 6) and made various fact-specific findings. They are of interest not so much for legal principle (although the case is a good summary) but for precedent examples when arguing in front of a tribunal.

Information and Consultation Regulations 2004

The DTI has today published:

• its draft Guidance Notes on the forthcoming Information and Consultation of Employees Regulations 2004, together with a consultation paper asking for feedback on the draft Guidance Notes by 22nd October 2004
• the government's response to the consultation on the draft Regulations; and,
• an updated draft of the Regulations (only 41 pages long!

Time Limits for Appeals to the EAT

The Court of Appeal has, today, handed down judgment in Gdynia American Shipping Lines (London) Ltd v Chelminski.

Overruling previous EAT authorities, the Court of Appeal held that the 42 days for lodging an appeal from the tribunal's decision runs from the date that the decision is sent out by the tribunal office. It does not start running (despite s7 of the Interpretation Act 1977 saying that service is effective two days after postage) from the deemed date of service.

The previous cases of Immigration Advisory Service v Oommen and Scotford v SmithKline Beecham are wrongly decided and are overruled.

Part-Time Workers - Retained Firefighters

(Thanks to Nicholas Chronias of Beachcroft Wansbroughs, and John Bowers QC of Littleton Chambers (both of whom represented Kent & Medway Towns Fire Authority) for telling me this decision had been handed down)

The Court of Appeal has upheld the Employment Appeal Tribunal in Matthews v Kent & Medway Fire Authority (better known as the 'retained firefighters' case), although it overturned one of the key findings in the case. Matthews is the leading case under the Part Time Workers (Prevention of Less Favourable Treatment) Regulations 2000.

For those who may not be familiar with the term, 'retained' firefighter simply means 'part-time' firefighter.

The judgment is short, but forceful. Maurice Kay LJ overturns the Employment Appeal Tribunal's decision that part-time firefighters were employed under different types of contract. He confirmed that full-time firefighters fall within the category of "employees under a contract that is neither for a fixed term not a contract of apprenticeship". He then held that since the categories in regulation 2(3) are stated to be mutually exclusive, it is inappropriate to find that retained fire-fighters fall within the catch-all category "any other description of worker..." since, like full-timers, they work under a contract which is neither for a fixed term not a contract of apprenticeship. Thus full-time and retained firefighters do, contrary to the EAT's view, work under the same type of contract.

However, Maurice Kay LJ upheld the tribunal's (and EAT's) decision that retained firefighters did not perform "the same or broadly similar work" to full-time firefighters. Both groups had, at their core, a duty to fight fires. However, full-time fire-fighters also had other, additional duties, and the Court of Appeal held the tribunal was entitled to find that this meant the two jobs were not truly comparable.

Accordingly the overall decision was upheld in (as Maurice Kay LJ) described it, "a pyrrhic victory" for the firefighters in having part of their appeal allowed, which "may have happier consequences for other part-time workers in other cases."

Disability Discrimination - House of Lords

The House of Lords has, this morning, handed down its opinion in the important case of Archibald v Fife Council.

Mrs Fife was a road sweeper. She became unable to walk after a rare complication of surgery, and could not fulfil her job. It was common ground she was disabled within the meaning of the Disability Discrimination Act 1995. Her employer, Fife Council, interviewed her for a sedentary post but chose to appoint a more qualified individual. It therefore dismissed her.

The House of Lords held:

• there is a positive duty to make reasonable adjustments - unlike sex and race discrimination, an employer is obliged to positively discriminate in favour of disabled people;
• contrary to the EAT and Court of Appeal's view, there was an 'arrangement' which placed Mrs Archibald at a substantial disadvantage; namely, an 'arrangement' that if she was physically unable to work as a road sweeper, she was liable to be dismissed;
• the positive obligation to make reasonable adjustments potentially includes allowing disabled persons to 'trump' applicants for other jobs, even if the disabled employee is not the best candidate, if the disabled employee is suitable to do that work.

Thus the House of Lords remitted the case to the tribunal to decide whether Fife Council failed to make reasonable adjustments and/or treated Mrs Archibald less favourably by requiring her to undergo an interview for the sedentary job rather than offering it to her as of right.

If anyone wants to read the judgment, the most thorough opinion (and easiest to read!) is Baroness Hale's, starting at para. 46.

Discrimination Overseas - Jurisdiction

The EAT has handed down its decision in the important case of Saggar (&ors.) v Ministry of Defence.

Under the sex and race discrimination legislation, an employee can claim discrimination "unless the employee does his work wholly outside Great Britain". This case considers the position of three army officers who were based outside Great Britain and answers three questions.

1. What is the time at which whether the Applicant works outside Great Britain to be judged?
Burton P. held that one looks at the time of the allegations of discrimination. There is no discrimination at an establishment in Great Britain if the person being discriminated against (abroad) is either someone who used to work in Great Britain, but has not done so for many years, or who is employed under a contract which contemplates he might be employed in Great Britain, but in fact he never was (para. 27)

2. What is work?
In one of the cases, the overseas officer attended training courses in Great Britain during the year. If this was 'work', then she did not do her work 'wholly' outside Great Britain, so the tribunal would have had jurisdiction to hear her complaints.

The EAT held that attendance at a training course may be work (and, on the facts in this case, was work) - the important factors being the contractual position, the content of ther work, its duration and regularity (paras. 36-37)

3. Is there a de minimis exception?

Yes. One of the cases involved an army chaplain who attended a funeral in Great Britain (which was held to be 'work'), whilst based in Germany. The EAT held that a de minimis principle applies, and that "it would offend against the de minimis principle to found jurisdiction on a one day visit" (para. 45).

New ACAS Code on Disciplinary and Grievance Procedures

The revised ACAS Code on Practice on Disciplinary and Grievance Procedures in the Workplace was laid before parliament yesterday. Subject to parliamentary approval, it will come into force on 1st October 2004.

There is substantially more information about the new dispute resolution procedures than appeared in the draft Code (which went out to consultation earlier this year). In keeping with ACAS Codes, it is written in user-friendly language and is a very good summary of the law (and good practice) relating to conduct issues in the workplace.

I am offering in-house seminars on the new dispute resolution procedures (in-house, up to three hours). Click the link on the right for more details (including fees).

Bias

An interesting (and unusual) decision on tribunal bias has been put on the EAT website today.

In Breeze Benton solicitors v Weddell, the EAT held that there was an appearance of bias if a chairman, who was alleged to have been critical of a litigant in proceedings a year earlier, sat again in another case involving that litigant.

The tribunal chairman had, it was said by Breeze Benton, criticised the firm (and awarded costs against it) fifteen months earlier when one of the two partners appeared in person to defend an unlawful deductions claim. The chairman did not accept the firm's recollection was accurate (although from the EAT's description, the firm's conduct undoubtedly warranted criticism). The firm did not appeal at the time against the costs order, but complained in an incorrectly addressed letter to the Lord Chancellor's department which they did not chase up.

Fifteen months later, the same firm was again before the tribunal for a 10-day hearing. It was allocated to the same chairman who, before the parties came into the room, anticipated the point and raised it with the regional chairman, who said it was not possible to reallocate the case to another chairman without adjourning it for some months. The Respondent then formally applied for the chairman to recuse himself on grounds of apparent bias. The tribunal unanimously refused, partly on the basis that the two wing members could outvote the chairman if necessary, and partly on other grounds.

The EAT, on existing authority, held that it is no answer to a recusal application to say that the Chairman is only one of three members with an equal vote, given the important position of the legally qualified and presiding member of a tribunal of three members (para. 44(3)).

But of significance, the EAT also held that "the very fact that [the Respondent] had complained [to the Lord Chancellor's Department] about the Chairman's conduct made it inappropriate that the Chairman should sit..." (para. 47). This approach must be questioned. If correct, it means that the vexatious litigant (and, indeed, unions and large companies who regularly appear in cases in the same region) can 'cherry-pick' their chairmen by complaining about those whom they do not like appearing in front of. This approach is dangerous as it can be easily abused: if a chairman decides (say) three consecutive cases against a local large employer, will the mere fact that that employer then complains (whether on good grounds or not) mean that the chairman has to recuse himself from hearing future cases? Surely not.

ACAS Booklet on Redundancy

ACAS has updated its booklet on redundancy.

In line with all the ACAS booklets, it is becoming more practical and user-friendly. This one contains really useful information, particularly the 'walkthrough' of how to conduct a redundancy exercise in appendices 1 and 2.

The only adverse comment is that the booklet mentions in passing, but does not explain in any detail, the mandatory dismissal procedures which come into force from 1st October 2004. These will apply to all dismissals of less than 20 staff within a 90 day period.

Effect of Human Rights Act on unfair dismissal claim against private-sector employer

The Court of Appeal has, this morning, handed down a rather academic decision dealing with the vexed question of whether tribunals must take account of the Human Rights Act 1998 (in this case, the right to respect for privacy) when deciding unfair dismissal claims brought against private sector employers. The case, X v Y, is well known because of the rather unusual facts. The EAT's decision is reported at [2003] IRLR 561.

Facts

Mr X worked with vulnerable children. On a Saturday in January 2001, he drove to a transport cafe, entered the toilet, met a man he did not know, and "they began to engage in sexual activity". A passing policeman arrested them.

Mr X accepted a caution, and his name was placed on the Sex Offenders register. His employers, who worked closely with the Probation Service, discovered this. After full hearings, they dismissed him on the grounds of (a) having committed a criminal offence; and (b) thereafter not having disclosed it. The tribunal found the dismissal was fair.

The Issue

The issue for the Court of Appeal was whether a tribunal is bound to have regard to the right to respect for privacy in private life, accorded by article 8 of the ECHR, when deciding whether a dismissal is fair or unfair.

The tricky point was that the employer was a private-sector employer, and the Human Rights Act only provides that public bodies must comply with the ECHR. Thus, the issue because, should the tribunal (as a public body) apply the ECHR in private-sector cases?

The EAT's Decision

The EAT (HHJ Peter Clark presiding) held that article 8 was not engaged, therefore the main issue did not need to be determined. He considered that an act of 'cottaging', committed in a public place and which attracted a criminal caution was a public matter not a private matter.

The Court of Appeal's Decision

The majority of the Court of Appeal (Mummery and Dyson LJJ) agreed with HHJ Peter Clark, holding that article 8 was not engaged on the facts of this case. In a compelling minority judgment, Buxton LJ doubted this (thinking that acts in a secluded room in private could properly be categorised as private in nature), but thought that the acceptance of the caution by Mr X subsequently removed the private aspect of it.

Mummery LJ went on to consider the alternative point: what should a tribunal do when faced with an argument that a private-sector employer must respect an individual's right to privacy. Buxton LJ agreed with this part of the judgment, but Dyson LJ did not comment on it.

Mummery LJ stated that there should be no difference in approach, whether the employer is private- or public-sector. He described the effect of the ECHR as "oblique", rather than horizontal (para. 59). He then set out eleven factors to be considered by tribunals when deciding the impact of ECHR rights on the fairness of a dismissal. However, he did not actually give an answer - instead he restated basic principles and said it was for employment tribunals to decide! So matters are no clearer.

Costs

The Court of Appeal has upheld, in principle, the ET and EAT's decision in McPherson v BNP Paribas, although it has varied the amount of costs payable by Mr McPherson.

Mr McPherson withdrew his ET claim about two weeks before the hearing. He cited ill-health, although there were doubts about the extent of the ill-health. He had failed to comply with a number of tribunal orders in the run-up to the hearing. The tribunal, and the EAT, held that the late withdrawal was (against the background of breach of tribunal orders) unreasonable conduct. He was ordered to pay all of BNP Paribas's costs. See my bulletin of 27/8/03 for a summary of the EAT's decision.

The Court of Appeal (Mummery LJ) held that:

"it would be legally erroneous if, acting on a misconceived analogy with the CPR, tribunals took the line that it was unreasonable conduct for employment tribunal claimants to withdraw claims and that they should accordingly be made liable to pay all the costs of the proceedings. It would be unfortunate if claimants were deterred from dropping claims by the prospect of an order for costs on withdrawal, which might well not be made against them if they fought on to a full hearing and failed. As Miss McCafferty, appearing for Mr McPherson, pointed out, withdrawal could lead to a saving of costs. Also, as Thorpe LJ observed during argument, notice of withdrawal might in some cases be the dawn of sanity and the tribunal should not adopt a practice on costs, which would deter applicants from making sensible litigation decisions.

"On the other side, I agree with Mr Tatton-Brown, appearing for BNP Paribas, that tribunals should not follow a practice on costs, which might encourage speculative claims, by allowing applicants to start cases and to pursue them down to the last week or two before the hearing in the hope of receiving an offer to settle, and then, failing an offer, dropping the case without any risk of a costs sanction.

"The solution lies in the proper construction and sensible application of rule 14. The crucial question is whether, in all the circumstances of the case, the claimant withdrawing the claim has conducted the proceedings unreasonably. It is not whether the withdrawal of the claim is in itself unreasonable..."

On the facts, the Court of Appeal agreed that Mr McPherson had acted unreasonably, but allowed his appeal to the extent that is substituted a smaller period of time in connection with which costs would be payable (effectively excluding the first months of the litigation, when Mr McPherson had not been conducting the litigation unreasonably).

Failure to Attend at Tribunal

The Employment Appeal Tribunal has, in Cooke v Glenrose Fish Co Ltd, performed a U-turn on the approach for tribunals to take when a party fails to attend.

The previous position, set out by the EAT in London Borough of Southwark v Bartholomew [2004] ICR 358, was that it was incumbent on a tribunal to telephone the litigant to establish whether they were on their way, and the reason for non-attendance.

Burton P., has now held there is no such duty (although a tribunal should consider doing so). Since there is no obligation on a party to attend a hearing, it is perfectly legitimate to hear the case in a party's absence without further enquiry. However, if the non-attending party then applies for a review, a review should ordinarily be allowed if a good reason for the non-attendance is put forward.

Importantly, Burton P. makes it clear that (unlike for extensions of time), it is not good enough for a tribunal to refuse a review on the grounds that a litigant may have a strong claim against his solicitor. The aggravation, uncertainty and cost of satellite litigation militates against encouraging litigants to sue their solicitors for negligence. Provided the attending party can be compensated in costs, there would normally be no good reason not to allow a review and order a retrial.

Statutory Dispute Resolution - DTI Guidance

The DTI's Guidance Notes to the forthcoming mandatory disciplinary and grievance procedures (coming into force 1st October 2004) have just been placed on the DTI website.

Overall, it is a well drafted and thought out document, which goes some way towards explaining the horrendously complex (and in places, incomprehensible) regulations.

I will be updating my Dispute Resolution Analysis Notes to incorporate the guidance. In the meantime, here are a few key points:

• the Guidance Notes make it clear the dismissal procedures do apply for dismissals on grounds of redundancy and, as importantly, retirement
• they make it clear that the mandatory DDPs are an addition to ordinary concepts of fairness under s98(4) of the ERA 1996
• it has useful sections on overlapping procedures and on extensions of time for presenting claims.

New Equality Commission - DTI White Paper

The DTI has, today, issued a White Paper seeking views on the new integrated equality commission, to be known as the Commission for Equality and Human Rights (CEHR).

The new commission will combine the functions of the EOC, CRE and DRC (whoops - redundancy time) in challenging discrimination, as well as promoting human rights issues. In addition to taking over the functions of those three organisations, it will be responsible for tackling discrimination on grounds of age, sexual orientation, religion and belief.

The White Paper sets out proposals for the structure and mandate of the new organisation. The deadline for responses is 6th August 2004.

Transexual Discrimination

The House of Lords has handed down its decision in A v Chief Constable of West Yorkshire Police.

In 1998, the Chief Constable of West Yorkshire rejected Ms A's application to become a constable in the West Yorkshire Police on the ground that, as a male-to-female trenssaxual, she could not perform the full searching duties required of a police constable. The issue was whether he thereby discriminated against her unlawfully in breach of the Sex Discrimination Act 1975

The Chief Constable admitted that the refusal was prima facie discriminatory, but defended the claim on the basis that being able to search is a genuine occupational qualification.

The House of Lords held that gender was not a genuine occupational qualification. Men could perform searching duties, and so could women. To put it another way, it was not a genuine occupational qualification that somebody needed to be either a man or a woman to undertake searching duties - both male and female officers undertook searching duties. The genuine occupational requirement defence was not drafted to cover gender reassignment, and this case did not fall within the exception.

Note that this is an enormous oversimplification of a very complex judgment Moreover, the case is now largely of historic interest only, due to the subsequent implementation of the Sex Discrimination (Gender Reassignment) Regulations 1999.

Rolled up Holiday Pay

The Court of Appeal has, for the first time, considered the thorny issue of 'rolled-up' holiday pay.

In an astonishingly robust and clear judgment, Laws LJ held in the conjoined appeals of Clarke v Staddon and Caulfield v Marshalls Clay Products (see my bulletin of 4/8/03 for the EAT decision) that 'rolled-up' holiday pay complies with the EU Working Time Directive. He examined the policy behind the Directive and relied heavily on the fact that the Directive does not state that the payment has to be received at the time the holiday is taken.

He then asked the question: does rolling-up holiday pay undermine or negate the relevant article of the EU Working Time Directive, and held that it did not. He also held that since the Working Time Regulations 1998 were enacted to implement the Directive, if they said anything different, they were ultra vires. However, he went to hold that the WTR 1998 did allow for rolled-up holiday pay.

But he said it was unsatisfactory that there were two inconsistent decisions; one from the English Court of Appeal and the other from the Scottish Court of Session (in MPB Structures v Munro - see my bulletin of 8/4/03). As a result, he thought that the issue should be referred to the European Court of Justice, and adjourned the hearing to enable Counsel to suggest a draft form of reference. He made it clear that the reference would (if possible) be joined with the reference from the Leeds employment tribunal on the same point (see my bulletin 17/3/04).

Also of significance: he held (in a passage I have some reservations over) that the EAT sitting in England is not bound by the decisions of the Scottish Court of Session. This must be doubtful because the EAT - whether sitting in England or Scotland - is one statutory body. It cannot be right that the same court may, or may not, be bound by decisions of higher courts depending on where the Applicant lives.

New Draft CRE Code of Practice

The CRE is consulting on a revised statutory Code of Practice on Racial Equality in Employment. It is now twenty years since the current statutory code of practice came into force. Since then, there have been a number of important amendments to the Race Relations Act 1976, as well as new EU legislation governing racial equality in the workplace.

To reflect these changes, revisions have been made to the new code, including:

• greater accessibility, in terms of language and style;
• an accurate reflection of current legislation and the modern world of work;
• more real-life employment tribunal case studies; and
• detailed guidance on topics such as positive action, ethnic monitoring and racial equality policies.

The code aims to give practical guidance to employers, recruitment agencies, trades unions and individual employees on how to meet their obligations under the Race Relations Act. It will have statutory status; this means that any of its provisions can be referred to in an employment tribunal.

The consultation paper is available on the CRE website. Consultation closes on Friday, 6th August 2004.

ACAS Guides

ACAS has updated its booklets on Absence and Labour Turnover, and on the new Employment Equality Legislation.

Note: I could not open the two bottom links directly. If you experience similar problems, go to http://www.acas.org.uk/about_acas/whatsnew.html and save the guides to your hard disk, then open them from there.

Employment Status

The Employment Appeal Tribunal has handed down its decision in Staffordshire Sentinel Newspapers Ltd v Potter (HHJ Peter Clark, argument 18th March 2004).

It confirms that an "irreducible minimum" for there being a contract of employment is personal service. Following Express & Echo Publications v Tanton [1999] ICR 693, CA, the EAT held that a provision in Mr Potter's contract that he be entitled to substitute "a suitable person" to perform his duties, whenever he wanted, was fatal to him accruing status as an employee.

Note that other cases have held that such a provisions is not necessarily conclusive. Thus in MacFarlane v Glasgow City Council [2001] IRLR 7, it was held that a gym instructor whose contract provided he could select a substitute from a list pre-approved by the gym did not cease to be an employee because of that provision. A similar result was reached in Byrne Brothers (Formwork) Ltd v Baird [2002] IRLR 96.

The position therefore appears to depend on the extent of the substitution clause. If the worker has an unfettered discretion to appoint a substitute, he cannot be an employee. If he has a heavily fettered discretion, or requires the employer's approval, the substitution clause will not prevent him from accruing employee status.