Employment Law Titles ~ Spring 2006


Actions to Prove a Point Not Protected Disclosure
The Public Interest Disclosure Act 1998 (PIDA) – often referred to as the ‘Whistleblowing’ Act – came into force in July 1999. PIDA inserted new sections into the Employment Rights Act 1996 which give workers legal protection when disclosing information relating to crimes, breaches of a legal obligation, miscarriages of justice, dangers to health and safety or the environment and to the concealing of evidence relating to any of these. In particular, PIDA makes it automatically unfair dismissal to dismiss an employee for making a ‘protected disclosure’, in good faith, to someone to whom they are entitled to make it, or to penalise them for doing so.
The Employment Appeal Tribunal (EAT) has handed down an important decision in a case (Bolton School v Evans) which examined the causal nature of the link between the protected disclosure and the detriment suffered by the employee who made it.
Mr Evans worked as a technology teacher in the Information and Communication Technology (ICT) department at Bolton School. The school was planning to consolidate its existing computer networks into a new system which would be used both by pupils for teaching purposes as well as by staff for administrative purposes and record keeping. Mr Evans was concerned that data security issues were not being satisfactorily addressed and feared that it would be relatively easy for someone to gain unauthorised access to information held on the system, which could be a breach of the Data Protection Act 1998 (DPA).
When the new network was in place, a decision was taken not to install the intended security system but to rely on password security instead. Mr Evans did not think this was adequate and discussed these concerns with colleagues. He was of the opinion that the person responsible for the system was happy for him to test to see if he could break into it. This he did and he succeeded in disabling some of the user accounts for the ICT Services department by gaining access to them from the learning centre used by students. This caused disruption to the network as ICT Services closed it down, fearing that someone had hacked into the system.
The school accepted that Mr Evans had acted in good faith but, because it believed that he had deliberately hacked into the computer network without permission, he was given a written disciplinary warning. Mr Evans was of the view that he did have the authority to act as he had. He considered that he was being disciplined for drawing the school’s attention to a breach of the DPA and that the warning was a detriment suffered by him for making a protected disclosure to this effect. He resigned and brought a claim for constructive dismissal.
The school argued that he was disciplined for hacking into the computer system, not because he had disclosed matters of public interest.
The Employment Tribunal (ET) found that Mr Evans’s resignation did amount to constructive dismissal. He had made a protected disclosure as he had reasonably believed that the information tended to show that the school had failed, or was likely to fail, in its obligations under the DPA. The ET did not regard Mr Evans’s conduct in hacking into the computer as being separate from the disclosure itself but considered it ‘part and parcel’ of it, thereby attracting the same protection. The ET also judged that the dismissal amounted to unfair dismissal independently of the protected disclosure provisions.
Bolton School appealed against this decision. The EAT considered that the ET had erred in regarding Mr Evans’s conduct as part of the protected disclosure. PIDA protects disclosure but not other conduct of the employee, even if it is connected to the disclosure. Had Mr Evans not broken into the computer system, it is unlikely that he would have been the subject of any disciplinary action. The law does not allow someone to commit what would otherwise be acts of misconduct in an attempt to show that their concerns are justified.
The appeal therefore succeeded and the EAT remitted the case to the same ET to determine whether there had been a constructive dismissal in the circumstances.
It is in the interest of all employers to make sure that employees feel that they can raise concerns internally and without suffering any detriment. Whistleblowing policies should be tailor-made to suit the individual organisation.
Alcoholic Bonus Not Discriminatory
The Employment Equality (Religion or Belief) Regulations 2003 prohibit direct discrimination, indirect discrimination, victimisation and harassment in the employment field (including vocational training) on the grounds of a person’s religion or belief.  
Discrimination on religious grounds can sometimes amount to unlawful indirect race discrimination, contrary to the Race Relations Act 1976, if a requirement or condition is imposed at work with which members of a racial group are less likely to be able to comply or where the requirement or condition is not justifiable on non-race related grounds or is to the detriment of the person concerned because he or she cannot comply with it.
In a recent case, a Muslim insurance salesman who took offence when his employer offered alcohol as a performance incentive has lost his claim for religious and race discrimination at the Employment Tribunal (ET).
25-year-old Mr Imran Khan, of Bristol, worked for Direct Line Insurance and was one of 14 people in the city awarded the bonus for sales of pet and household insurance policies. Mr Khan claimed that offering bottles of wine as a reward put him at a disadvantage compared with his colleagues as his religion strictly forbids the consumption of alcohol. He claimed damages for hurt feelings under the Employment Equality (Religion or Belief) Regulations and also accused his employer of indirect racial discrimination because he is of Pakistani origin and therefore more likely to be a Muslim. Mr Khan argued that no alternative incentive award was offered.
The ET judged that a teetotal non-Muslim would have been in exactly the same position as Mr Khan as regards the bonus award and that he had failed to show that he had received less favourable treatment than would have been afforded to such a comparator. The ET also heard that a Muslim colleague had exchanged his wine for gift vouchers.
Says <<CONTACT DETAILS>>, “Employers can find themselves committing indirect discrimination quite unintentionally. In order to avoid the danger of discriminating in some way, employers should develop and use policies and procedures which cover all aspects of the employment relationship. In particular, care should be taken over requests for time off work as refusing time off for religious observance could amount to unjustified indirect discrimination. There is no limit to the amount of compensation that can be awarded in discrimination claims.”
ACAS has useful guidance on this subject, entitled ‘Religion or Belief and the Workplace’. One key point is to make sure that you understand any requirements of the religion or belief of individual members of staff. The guidance can be found at http://www.acas.org.uk/media/pdf/f/l/religion_1.pdf.
Changes to Fire Safety Laws Delayed
Fire safety law is set to change in England and Wales, but not yet. The Regulatory Reform (Fire Safety) Order 2005 (RRFSO), which will affect all non-domestic premises in England and Wales, received Parliamentary Approval on 7 June 2005 and was due to come into force on 1 April 2006. However, the Government has announced a delay in its implementation so that businesses and those responsible for enforcing the new laws have adequate time to familiarise themselves with the new regime and the guidance that will accompany it. Accordingly, the new rules will now be brought in on 1 October 2006, which is the same date as for the introduction of the new safety laws in Scotland.
The main emphasis of the changes will be to move towards fire prevention. Fire certificates will be abolished and will cease to have legal status. Under the RRFSO the 'responsible person' for each premises will be required to carry out an assessment of the risks of fire and take action to remove or reduce them. Risk assessments will have to take into consideration the effect a fire may have on anyone in or around the premises and will need to be kept under regular review.
There will be a series of guides published to assist those preparing fire risk assessments. More information is available on the website for the Office of the Deputy Prime Minister at http://www.firesafetyguides.odpm.gov.uk.
Data Protection – Current Position
Mr Michael John Durant, who lost a landmark data protection case in the Court of Appeal concerning his attempts to gain access to information on him which he felt would assist him in a dispute with Barclays Bank, has been refused permission to appeal to the House of Lords.
In reaching its decision, the Court of Appeal had ruled that a relevant filing system, for the purposes of the Data Protection Act 1998 (DPA), only covers manual files if they are organised in such a way as to provide the same or similar ease of access to data as a computerised system. This means that for businesses not subject to the Freedom of Information Act, the Court’s decision effectively reinstated the privacy standards as laid down in the previous Data Protection Act 1984, which applied to computerised records only.
Employers faced with a Subject Access Request (SAR) for personal data held manually have therefore been able lawfully to reject the request if to comply would mean trawling through files trying to find data on an individual and then trying to determine whether the data is personal or not. If files are not organised or indexed in such a way as to enable easy location of specific information on the data subject, then the system does not qualify as a relevant filing system under the DPA.
In the light of the Court of Appeal’s ruling, the Information Commissioner issued revised guidance for employers on how to handle a request by an individual for data held on them. The guidance is available on the Information Commissioner’s website at http://www.informationcommissioner.gov.uk.
This may not be the end of the matter however. The European Commission has expressed concerns that UK law does not implement the EC Data Protection Directive and is believed to have written to the Government outlining its concerns and raising the possibility of legal proceedings in the European Court of Justice.
Also, it has been reported that Mr Durant is considering a further appeal to the European Court of Human Rights in Strasbourg.
Meanwhile, a recent Good Practice Note from the Information Commissioner serves as a timely reminder that using e-mail can mean that communications are subject to the DPA. An employee reference you have written does not normally have to be disclosed by you if a SAR is made. However, a reference you have received that is held in electronic form (such as an e-mail) probably would. The guidance is available at http://www.ico.gov.uk/cms/DocumentUploads/Subject_access_and_employment_references.pdf.
Contact <<CONTACT DETAILS>> if you would like individual advice on complying with the Data Protection Act.
ECJ Rules on Rolled Up Holiday Pay
Following conflicting decisions in the Scottish and English courts, the issue as to whether or not it is a violation of workers’ rights to pay a ‘rolled up’ rate of pay, whereby the normal salary includes an additional element to cover holiday pay and workers are not paid when they are on leave, was referred to the European Court of Justice (ECJ) for an interpretation of Article 7 of the EC Working Time Directive.
The Advocate General gave a preliminary opinion on the subject, indicating that such arrangements could be lawful if they were properly structured and there was a genuine increase in the rate of pay to cover the holiday element. The central requirement of Article 7 of the Directive is that guaranteed annual leave is actually taken.
The ECJ has now handed down its ruling. This varies from the opinion given by the Advocate General, but this makes little practical difference. In the Court’s view, it is essentially unlawful for an employer to roll up holiday pay rather than to pay it during the specific period when a worker takes leave. However, provided the sums paid are clearly identifiable as additional amounts paid in respect of holiday pay, over and above payment for work done, and the employee recognises them as such, Article 7 does not preclude such payments from being set off against payment for specific leave which is actually taken by the worker.
Says <<CONTACT DETAILS>>, “The aim of the Working Time Directive is to protect the health and safety of workers by regulating the number of hours worked and it establishes, amongst other things, mandatory minimum holiday entitlements. The onus is on any employer who has adopted the practice of paying rolled up holiday pay to demonstrate that the arrangements are transparent, agreed with and well understood by staff. Failure to do so will mean there is no entitlement to set off the rolled up holiday pay against amounts due to an employee on specific leave. Pay slips should show clearly the additional holiday pay element in addition to remuneration for work done. It is also advisable to monitor holiday records to make sure workers do take their annual leave entitlement and are not put off doing so because of the method of payment. Contact us if you would like advice on this subject.”
Employment Rights – Ministers of Religion
For many years it has been accepted law that ministers of religion do not normally come within the definition of ‘employee’ for the purposes of the Employment Rights Act 1996 (ERA) because they have traditionally been deemed to be ‘office holders’ working for God and as such do not have a contract of employment. However, their status may have to be reconsidered.
In a recent case (Percy v Church of Scotland Board of National Mission) the House of Lords considered whether the relationship between a minister of religion and his or her church can be considered to be one of employment within the meaning of the Sex Discrimination Act 1975 (SDA).
Ms Percy, an ordained minister of the Church of Scotland, brought claims for sex discrimination and unfair dismissal in the Employment Tribunal (ET). Her claim was that it was unlawful sex discrimination for the Church to force her to resign, after she was reported to have had an affair with a married elder, when similar action had not been taken against male ministers in similar circumstances. The ET dismissed her claim on the grounds that she was not an employee for the purposes of claiming unfair dismissal or sex discrimination.
Ms Percy appealed to the Employment Appeal Tribunal (EAT) that her relationship with the Church did meet the definition of employment in the SDA in that she was engaged ‘under a contract to personally execute any work or labour’. However, the EAT, and subsequently the Court of Session, upheld the decision of the original ET.
The House of Lords, however, ruled by a 4:1 majority that holding an office and being an employee are not inconsistent as a person may hold an office ‘on the terms of, and pursuant to, a contract of employment’. Ms Percy was required to undertake her duties in a personal capacity and the degree of control exercised over the way she performed her duties made it apparent that there was a contract to personally undertake the work. Therefore, the relationship between Ms Percy and her Church was one of employment within the definition in the SDA.
As Ms Percy did not pursue her claim for unfair dismissal, the appeal did not consider whether or not she was an employee within the narrower definition under the ERA. However, two of the Law Lords commented that this question needed clarification.
Says <<CONTACT DETAILS>>, “Although this case concerned an appointment under the Church of Scotland Act 1921, the decision is relevant throughout the UK. Even though it dealt with sex discrimination, it would appear to set a precedent for future claims on the employment rights of ministers of religion and it is likely to be only a matter of time before the courts see a challenge regarding the rights of clergy under the ERA.”
Equality Act 2006
The Equality Act 2006 gained Royal Assent on 16 February 2006.
The Act will introduce a new 'gender duty' which will require public bodies to take account of the different needs of men and women in order to ensure equality of opportunity when formulating policies or providing services. The Act will also outlaw discrimination on the grounds of religion or belief and sexuality in the provision of goods, facilities, services, education or rented accommodation.
From an employment law point of view, the Act creates a new, integrated equality commission, called the Commission for Equality and Human Rights, which from October 2007 will combine the functions of the Equal Opportunities Commission and the Disability Rights Commission. The work of the Commission for Racial Equality will be included from 2009 onwards.
The new Commission will also be responsible for dealing with discrimination on the grounds of religion or belief, sexual orientation and age. Legislation to outlaw discrimination in the workplace on the grounds of age is due to take effect in autumn 2006.
As well as challenging discrimination, the new body will also be responsible for promoting human rights issues.  
Expired Disciplinary Warnings – Take Care
In deciding whether a dismissal is fair or unfair, the Employment Tribunal will take into account whether or not a disciplinary warning was given. In the case of Diosynth Ltd. v Thomson, the Court of Session in Scotland recently considered the problem as to whether reliance can be placed on a warning that has expired.
Morris Thomson was employed by Diosynth Ltd. at its factory in Fife. The company produces chemicals for use in the pharmaceutical industry.
In July 2000, Mr Thomson was disciplined for failing to comply with a basic health and safety measure which resulted in a leakage of methanol. Prior to this, in 1998, Mr Thomson had been amongst a group of employees who were required to give an absolute commitment that they would henceforth comply with the strict procedures and documentary processes required of them. This followed a similar breach of the safety measure when an employee was dismissed for failing to follow basic procedures.
Diosynth’s disciplinary policy made it clear that a serious breach of safety rules and failure to follow company procedures and regulations would be regarded as gross misconduct. Mr Thomson assured the site operations manager that this was an isolated incident and he was given a written warning and suspended without pay for three days. The terms of the warning stated that the letter would remain on his record for 12 months.
In November 2001, five months after the warning had expired, an explosion occurred at the factory which led to the death of one of the operators. An investigation revealed that Mr Thomson and 17 other employees had on occasions failed to carry out the same basic safety measure. Disciplinary hearings were held but only Mr Thomson was dismissed. The Managing Director and Human Resources Director concluded that in the light of the warning issued in July 2000, he was incapable of following clear safety instructions even after he had been disciplined for not doing so and they had lost confidence in his ability to protect his own safety and that of others.
The Court of Session held that Mr Thomson’s dismissal was unfair. He was entitled to assume that the warning letter meant what it said and that it would cease to have any effect after one year. Diosynth should have issued a warning without time limit if they intended to rely on it subsequently.
Employers in businesses where health and safety issues figure prominently should ensure that disciplinary and health and safety policies set out clearly what action will be taken in the event of any breach. Care should be taken not to rely on a previous written warning that has expired. <<CONTACT DETAILS>> will be pleased to advise you on drafting policies to meet the needs of your individual business.
Female Transsexuals and Pension Rights
The Advocate General of the European Court of Justice (ECJ) has recommended that it was contrary to the Social Security Equal Treatment Directive for a male-to-female transsexual to be refused a retirement pension before the age of 65 when under UK law a woman is entitled to receive a state pension at the age of 60.
The opinion was given in the case of Richards v Secretary of State for Work and Pensions. Sarah Margaret Richards was born a male but underwent gender reassignment surgery in 2001. In 2002 she applied to have her state pension paid at the age of 60. The Department for Work and Pensions (DWP) refused on the grounds that she was still a male and would therefore have to wait until the age of 65. Ms Richards appealed to the Social Security Appeal Tribunal and the Social Security Commissioner, who referred the question to the ECJ.
In the view of the Advocate General, the failure to pay Ms Richards pension at 60 was discriminatory as the correct comparator in this situation is a woman registered as female at birth.
The action complained of in this case occurred before April 2005, when the Gender Recognition Act 2004 came into force. The Act gives transsexual people who make a qualifying application the right, from the date of recognition, to marry in their acquired gender, to be given a birth certificate recognising their acquired gender and to obtain the same social security benefits as anyone else of that gender. However, if the ECJ agrees with the Advocate General’s opinion in this case, the DWP could face claims from other male-to-female transsexuals who were denied a state pension at the age of 60 before the Gender Recognition Act came into force.
Employers with male-to-female transsexual employees should be aware of this ruling, which is likely to be pervasive as regards company pension schemes also. Whether a female-to-male transsexual might have to delay a pension to age 65 is unclear. Contact <<CONTACT DETAILS>> for advice on any employment law matter.
Government Proposals on Victim Cover Criticised
The Government has announced proposals to reduce the £200 million a year it pays out via the Criminal Injuries Compensation Scheme by making employers use their compulsory employers’ liability insurance to pay compensation to employees who are the victims of crime whilst at work. The proposed measures have been heavily criticised by both the Federation of Small Businesses and the Association of British Insurers. Opponents of the plan fear that its introduction would penalise businesses for the actions of criminals and would result in even higher insurance premiums, which already represent a significant burden for small businesses in particular.
The Home Office consultation paper on the proposals does not define what is meant by the words ‘whilst at work’. Critics point out that there is little or nothing an employer can do to protect its workers from a malicious criminal attack, particularly when someone’s job involves them working outside the workplace.
The Home Office has yet to announce a date for publication of its response to the views it has received on these proposals.
HSE Safety Statistics
The Health and Safety Executive (HSE) has published its latest Statistics of Fatal Injuries to Workers. These show that 220 people were killed in the workplace in the year 2004/2005, a rate of 0.7 per 100,000 workers. This compares with a figure of 236 for the previous year. Of the 220 fatalities, approximately half occurred in two industries, with 71 in the construction industry and 42 in the agriculture, forestry and fishing industries.
In the same period, 150,559 non-fatal injuries to employees were reported, a rate of 587 per 100,000 employees, and 361 members of the public were fatally injured in work-related accidents.
Overall, 35 million working days were lost in the year 2004/2005 (1.5 days per worker) – 28 million on account of work-related ill health and seven million because of workplace injury. Two million people were suffering from an illness which they believed was caused or made worse by their current or past work.
Many work-related deaths could be avoided if proper risk assessments and regular safety checks were carried out. In a recent case, a lorry driver was killed when the truck he was driving, which was overloaded with molten steel slag, tipped over and caught fire. The court heard that the employer had failed to carry out proper health and safety checks on the vehicle and ordered the company to pay a fine of £100,000 plus costs of £42,000. The judge described the driver’s death as an ‘accident waiting to happen’.
All employers, but particularly those engaged in potentially hazardous activities, must have robust health and safety measures in place in order to protect employees. Contact <<CONTACT DETAILS>> if you would like guidance on your health and safety responsibilities.                                                 
Important Victory for Part-time Firefighters
The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, which came into force on 1 July 2000, established a minimum standard of fairness for part-timers so that they cannot be treated less favourably than comparable full-time co-workers, unless the treatment is justified on objective grounds.
A comparable full-time worker must work in the same establishment as the part-timer, be engaged in broadly similar work and work under the same type of contract.
A test case on what is required in order to make a part-time worker comparable with a full-timer has now been decided by the House of Lords.
The case was brought by a group of part-time (or retained) firefighters who were claiming parity of terms of employment with their full-time colleagues (regular firefighters). They claimed that they were treated less favourably in that they were denied access to statutory pension arrangements, were denied increased pay for additional responsibilities and their sick pay arrangements were less favourable.
The Court of Appeal judged the Employment Tribunal (ET) and the Employment Appeal Tribunal to have been wrong in deciding that the part-time firefighters were employed under a different sort of contract from regular firefighters. However, when considering whether the retained firefighters were engaged in the same or broadly similar work as their full-time colleagues, the Court was of the opinion that although both types of worker had a core duty, which was to fight fires, the full-time workers had measurable additional duties and so the jobs were not truly comparable.
The House of Lords upheld the Court of Appeal’s ruling as to the nature of the contracts and then went on to consider whether retained firefighters and regular firefighters are engaged in the same or broadly similar work, with regard to whether they have a similar level of qualification, skills and experience. The Law Lords were of the view that the ET had looked for differences, rather than giving weight to the similarities, in the work done. This should be looked at as a whole with regard to the importance of that work to the enterprise as a whole. The original ET had found that ‘at the scene of the fire the actual job function carried out by all attending is effectively the same’ and that the ‘retained and whole-time firefighters were indistinguishable from one another’. In a majority decision the House of Lords allowed the appeal.
Says <<CONTACT DETAILS>>,“This is an important ruling which will benefit part-time workers who carry out broadly similar work to their full-time co-workers without receiving the same benefits. If you wish to discuss the issues raised by this case, or would like advice on contractual matters, contact us.”
In Brief
Age Discrimination Regulations Published
The Employment Equality (Age) Regulations 2006, which will outlaw age discrimination in the workplace, have now been published by the Department of Trade and Industry. The regulations will come into force on 1 October 2006 and can be found at http://www.dti.gov.uk/er/equality/draft_regs.doc.
There will be no upper limit to the compensation payable if an employer is found guilty of age discrimination under the new legislation.
If you would like assistance in reviewing your employment rules and procedures, including those relating to recruitment and retirement, contact <<CONTACT DETAILS>>.
In Brief
Civil Liabilities of Employees
The Management of Health and Safety at Work (Amendment) Regulations 2006 amend regulation 22 of the 1999 Regulations which concerns civil liability for breaches of a duty under the Regulations. A 2003 amendment provided that civil claims could not be brought against employers insofar as the duty applied to third parties – i.e. persons not in their employment. As of April 6, this protection is extended to employees in circumstances where they may owe a duty, under the Regulations, to third parties.
In Brief
‘Funny Name’ Test Costs ASDA £27,750
A supermarket manager who demanded that workers at the ASDA shop in Lutterworth, Leicestershire, with ‘foreign-sounding’ names produce proof of their entitlement to work in the UK cost his company £750 per employee when they were successful in bringing a race discrimination claim against the supermarket giant.
The manager was trying to avoid the company being fined for employing persons not entitled to work in the UK, but by selecting only those with foreign-sounding names for the check, he was discriminatory in his approach. Some of the employees had worked for the company for 18 years.
The case illustrates the point that any policy adopted for dealing with such matters must be applied consistently to the whole workforce.
In Brief
Total Smoking Ban
As has been widely reported, Parliament voted in favour of a total smoking ban in enclosed public places and workplaces in England and Wales when it was given a free vote on this issue in February. The Government intends to introduce the ban in summer 2007.
Under the Government’s plans for enforcing the ban in England and Wales, smokers who ignore the ban will face a fine of £50, whereas the fine for failing to prevent smoking has been set at £2,500. The penalty for not displaying ‘no smoking’ signs will be an on the spot fine of £200. Failure to pay could result in a maximum penalty of £1,000.
Employers who currently allow smoking in the workplace may be considering introducing a ban before this becomes law. We can advise you on implementing the change.
Legal Tests in Disability Discrimination Claims
A recent case has important implications for employers who do not want to fall foul of the provisions of the Disability Discrimination Act 1995 (DDA). Under the DDA, it is unlawful for employers to treat a disabled person less favourably than they would a non-disabled person or someone without that particular disability, unless it can be demonstrated that the treatment in question is justified. The DDA also requires employers to make reasonable adjustments to the working conditions and physical working environment where these place a disabled person at a substantial disadvantage. These include recruitment procedures and the terms on which employment is offered.
In Smith v Churchill’s Stairlifts plc, the Court of Appeal has ruled that the test as to whether adjustments the employer is required to make are reasonable is an objective one on which the Employment Tribunal (ET) can form its own view. The test as to whether less favourable treatment is justified, on the other hand, is a subjective one. It is for the employer to show that the reason is material to the circumstances of the particular case and is substantial. The ET might not agree with an employer’s opinion but is required to respect it provided the reason for less favourable treatment is one that a reasonable employer might have adopted in the circumstances.
Mr Smith applied for a job with Churchill’s Stairlifts plc selling a new product line – radiator cabinets – and was offered a place on a sales training course. If he completed the training satisfactorily, he would be offered a job. He had explained at interview that he had a condition that meant he had difficulty walking and carrying heavy objects. By the time the training course started, Churchill’s had decided that the best method of selling the new product was for the sales team to carry with them a full-sized radiator cabinet for demonstration purposes to potential customers. Mr Smith’s disability meant that he was unable to do this. He did suggest alternative ways that he might sell the product but the company withdrew his offer of employment.
Mr Smith claimed disability discrimination, alleging less favourable treatment and a failure to make reasonable adjustments under the DDA.
The ET and the Employment Appeal Tribunal found that there had not been unlawful discrimination. The Court of Appeal acknowledged that the ET had reached its conclusion before the decision of the House of Lords in the case of Archibald v Fife Council, which clarified the approach to be taken with regard to the correct comparator in each case and the approach to be taken regarding the disadvantage caused by the employer’s relevant ‘arrangements’ or ‘provision, criterion or practice’. Discrimination occurs if these leave a disabled person at a substantial disadvantage when the employer should have taken steps to protect him or her from that disadvantage.
The Court of Appeal held that both the requirement to carry a full-sized radiator cabinet and the withdrawal of the job offer if Mr Smith were unable to carry one were relevant ‘arrangements’ under the DDA. Churchill’s was therefore required to make reasonable adjustments if these put him at a substantial disadvantage. The fact that an employer believes that there is a more than insignificant reason for less favourable treatment of a disabled person does not prevent the ET from finding that it would nevertheless be reasonable for the employer to make an adjustment to the arrangements. The proper comparator in such cases is identified by reference to the disadvantage caused by the relevant arrangements and the comparison here was not with the rest of the population as a whole, as the ET held, but with those candidates who had been accepted onto the training course. Mr Smith was at a substantial disadvantage compared with other applicants who were not disabled.
The Court upheld Mr Smith's appeal and remitted the matter to the ET to assess the level of his compensation.
Says <<CONTACT DETAILS>>, “This is the first case concerning the application of the reasonable adjustment provisions to the recruitment process to reach the Court of Appeal. It gives clarification on the correct comparator and the different legal tests that apply to the making of reasonable adjustments and justifying less favourable treatment. However, employers are recommended to take advice on their individual circumstances.”
Noise at Work
On 6 April 2006 the new Control of Noise at Work Regulations 2005 replace the existing legislation. These reduce the lower action level for daily exposure to noise from 85dB(A) to 80dB(A) and replace the existing absolute limit of 90dB(A) (taking hearing protection into account) with 87dB(A), above which exposure is prohibited. New rules also apply regarding maximum instantaneous sound pressure levels. The Regulations can be found at http://www.opsi.gov.uk/si/si2005/20051643.htm.
Every employer with a ‘noise problem’ which cannot be eliminated has a duty under the Regulations to assess and control the risks and to provide employees who are likely to be exposed to noise with information and training on the attendant risks and to inform them of the steps that can be taken to minimise them. Where necessary, employees must be provided with personal ear protectors and notified of their own obligations under the Regulations. All noise control equipment and hearing protection must be properly maintained.
Last year, a train driver whose employer failed to provide protection from excessive noise levels at work was awarded £10,000 in compensation for damage to his hearing. His employer had considered providing ear protection, but had decided it was not practicable to do so. The Court of Appeal found that this breached the employer’s common-law duty of care to the employee who should at least have been offered ear protection. The employer had also failed to provide the employee with information about the risks to his hearing posed by the noisy environment or what steps he might take to prevent hearing loss.
Employers whose premises or work type expose their employees to noise should take steps to comply with the new stricter standards for control of exposure to noise. An employee who suffers hearing loss because the employer fails to take appropriate action may well be entitled to compensation.
Pension Rights and Consultation
The Occupational Pension Schemes (Early Leavers: Cash Transfer Sums and Contribution Refunds) Regulations 2006, which come into effect on 6 April 2006, give increased rights to members of an occupational pension scheme who have at least three months’ qualifying service who leave the scheme early without any right to a pension from the scheme.
Qualifying employees will be entitled either to a cash sum to be transferred to another pension scheme or to a refund of their contributions. The choice will be up to the individual member.
The Minister of State for Pensions Reform, Stephen Timms, said, “This will provide more of an incentive to build up pension rights than currently exists. If the member decides to take the cash transfer sum then they will benefit not only from their own contributions to the scheme but also those of the employer.”
The Regulations can be found at http://www.opsi.gov.uk/si/si2006/20060033.htm.
In addition, the Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006 have also been published. The Regulations, introduced under the Pensions Act 2004, will mean larger employers will not be able to make major changes to their pension scheme without first consulting with current and prospective members, or their representatives, for a period of at least 60 days before the changes can be introduced.
The requirements affect employers with more than 150 employees from 6 April 2006, employers with more than 100 employees from 6 April 2007 and employers with more than 50 employees from 6 April 2008.
Changes to occupational pension schemes that will require the employer to consult include closing the scheme to new members, changing the accrual rate in a defined benefit scheme, changing a defined benefit scheme to a money purchase scheme, reducing employer contributions and increasing member contributions. Changes to personal pension schemes (where the employer contributes) requiring consultation include a reduction in the employer's contributions or an increase in members' contributions.
Guidance to the regulations is available on the Department for Work and Pensions’ website at http://www.dwp.gov.uk/publications/dwp/2006/occ_pen_schemes/oppsce-2006.pdf.
Pregnant Women and Risk Assessments
Under the Management of Health and Safety at Work Regulations 1999, employers have a duty to alter working conditions to ‘avoid’ risk to a new or expectant mother. However, a recent case (New Southern Railway Ltd. v Quinn) illustrates that when carrying out the necessary risk assessments, it is possible for an employer to take this requirement too far.
Mrs Quinn began working for New Southern Railway Ltd., in Brighton, in April 2000 in the post of Station Manager Support Clerk. In September 2003 she was offered the vacant post of Duty Station Manager, with a three-month trial period, and her salary was increased accordingly. If she made reasonable progress and wished to continue in the job, the post would be made permanent. Mrs Quinn went on various courses and on 12 November was told by the Station Manager that he intended to speak with the manger concerned to ensure that she was appointed to the post full time.
However, on 18 November, Mrs Quinn became ill and was off work until 5 December. During this time, she discovered that she was pregnant and informed her employer of the fact. When she returned to work it was agreed that she should work on permanent middle shifts until the worst of her morning sickness was over and then a risk assessment of her job would be carried out. In fact, an assessment was made in respect of her new post and her previous job. Various possible areas of concern were identified, including the risk of verbal or physical abuse, should Mrs Quinn continue in her role as Duty Station Manager. The assessments were only completed in draft and Mrs Quinn’s immediate managers did not discuss any of the issues raised in them with the person who carried them out, who was of the opinion that Mrs Quinn would be able to continue in her present role, or with Mrs Quinn herself.
On 23 December 2003, Mrs Quinn was told that it had been decided that she should return to her former post at her previous salary. It was only at this point that she was given a copy of the risk assessments. Her managers were reported as saying that they wouldn’t be able to forgive themselves if anything happened to her baby.
In March 2004, Mrs Quinn presented her first claim to the Employment Tribunal (ET), alleging that the reduction in her salary was a detriment by reason of her pregnancy. However, she continued to work until April when she became ill again and remained off work until she commenced her maternity leave in June 2004. She then resigned and brought a claim for constructive dismissal and unlawful deduction of wages.
The ET found in Mrs Quinn’s favour, noting that New Southern Railway Ltd. had adopted ‘an extremely paternalistic and patronising attitude towards the Claimant and her condition’. Her managers had jumped to the conclusion that Mrs Quinn could not continue in her position because of their personal feelings and labelled it as a health and safety concern. At no time had they carried out a proper or reasonable analysis of the risk assessment and the risk of an assault was small.
New Southern Railway Ltd. appealed to the Employment Appeal Tribunal (EAT) on several grounds. The main arguments were that the phrase ‘avoid the risk’ in the Management of Health and Safety at Work Regulations meant that an employer was under an absolute obligation to eliminate any risks and therefore, in order to avoid any risk of an assault on Mrs Quinn, there had been no alternative but to remove her from her post. In addition, Mrs Quinn could not claim that she had been forced to resign when she had taken sick pay and maternity leave after the breach she complained of. New Southern Railway Ltd. regarded this as her acceptance of its actions and affirmation of her continuing contract of employment.
The EAT held that the term ‘avoid the risk’ does not mean to eliminate any risks entirely but to reduce them as far as is reasonably possible. In addition, when there is an ongoing reduction in someone’s pay, as there was in this case, it should not be treated as a single breach of contract. It was an individual fundamental breach each time the company failed to pay Mrs Quinn’s full salary. She was therefore entitled to resign.
“This case makes it plain that adopting an over-protective or paternalistic approach in circumstances such as this can cause a breach of the law,” says <<CONTACT DETAILS>>. “It is important to carry out proper risk assessments based on facts, not supposition.”
Protection Against Unfair Dismissal When Working Abroad
The House of Lords has handed down its decision on when an employee who works wholly or partly outside Great Britain can bring a claim of unfair dismissal before an Employment Tribunal (ET).
Under section 94(1) of the Employment Rights Act 1996 (ERA), an employee who has worked continuously for one year has the statutory right not to be unfairly dismissed. Section 196 of the ERA contained a limitation that this right did not apply where the employee ordinarily worked outside Great Britain. However, this section of the Act was repealed by the Employment Relations Act 1999 and the territorial limit was removed as otherwise workers posted to Great Britain would not have been protected and the UK would have been in breach of the EC Posted Workers Directive. As a result, several unfair dismissal claims have been made by employees working abroad, with varying outcomes. After a variety of inconsistent decisions, clarification of the ET’s territorial jurisdiction was needed.
The House of Lords heard three appeals jointly. In each case, the employee seeking to assert UK statutory employment rights had been working abroad at the time of their dismissal and wished to claim unfair dismissal in accordance with s94(1) of the ERA.
Serco Ltd. v Lawson
Mr Lawson was employed by a UK company with worldwide operations on Ascension Island, a dependency of the British Overseas Territory of St Helena.
Botham v Ministry of Defence
Mr Botham was employed by the Ministry of Defence as a youth worker and worked in a variety of bases in Germany.
Crofts and others v Veta Ltd. and others
Veta is a Hong Kong company, and a wholly owned subsidiary of Cathay Pacific (CP), whose sole function is to employ aircrew for CP. CP allowed its aircrew to be assigned to a permanent base outside Hong Kong. Although his services were peripatetic, Mr Crofts was based at Heathrow and lived in the UK.
The Court of Appeal had ruled that Mr Crofts could claim unfair dismissal as he was based in the UK but judged that Mr Lawson and Mr Botham could not avail themselves of s94(1) as they both worked outside Great Britain.
The question to be decided by the House of Lords was: what connection must an employee have with Great Britain in order to claim unfair dismissal in accordance with s94(1) of the ERA?
The House of Lords had to attempt to put a construction on the relevant section of the Act to determine what Parliament appeared to have intended. Lord Hoffman delivered the leading judgment and found as follows:
  • historically, UK employment legislation only permitted employees working within Great Britain to claim unfair dismissal in accordance with UK law;
  • in order to decide whether an employee was working in Great Britain, his actual place of work at the time of dismissal should be considered, not where his contract originally stipulated that he should work;
  • generally, those working abroad were excluded but there were two exceptions:
1.      an employee working abroad for an employer which conducts its business in Great Britain (such as a foreign correspondent for a newspaper); or
2.      an employee working in a British enclave (such as a military base) in a foreign country.
Accordingly, the House of Lords dismissed Veta’s appeal whilst allowing the appeals of Mr Lawson and Mr Botham. The three employees are now cleared to bring claims before the ET.
Says<<CONTACT DETAILS>>, “Employers should bear in mind that whether or not the ET has jurisdiction to hear a case will depend on how a contract of employment was operating in the circumstances, rather than on the terms of the original contract. However, it is sensible for employers and employees alike to ensure that contracts of employment are carefully drafted, especially when periods of service abroad are considered.”
Revised Asbestos Regulations
The new Control of Asbestos Regulations 2006 come into force on 6 April 2006. The Regulations repeal and replace existing laws on the control of exposure to asbestos and implement amendments to the European Asbestos Worker Protection Directive (AWPD). They aim to provide greater protection for maintenance workers and make changes in order to simplify the existing asbestos regulatory regime. The Regulations include measures to:
·        replace certain requirements of the Control of Asbestos at Work Regulations 2002 that only apply if a worker’s exposure to asbestos fibres is liable to exceed the action levels with a new system whereby notification to the enforcing authority will not apply to certain types of specified work where the exposure to asbestos is sporadic and of low intensity and where it is clear from the risk assessment that the control limit will not be exceeded;
·        replace the current regulation requiring employers to reduce exposure to as low a level as is reasonably practicable with a new requirement to minimise worker exposure to asbestos, in line with the wording used in the Control of Substances Hazardous to Health Regulations;
·        introduce a new asbestos fibre counting method; and
·        introduce a new single Control Limit for all types of asbestos of 0.1 f/cm³.
Additional changes to the asbestos regulatory framework include:
  • the introduction of the AWPD amendment which specifically prohibits the extraction of asbestos and asbestos products;
  • changes to the licensing rules aligning when a licence is needed with the requirement to notify work and less stringent controls on working with textured decorative coatings which contain asbestos;
  • employers using their own workers on their own premises will no longer be exempt from the licensing requirements;
  • accreditation requirements being extended to those issuing certificates at all the four stages of clearance certification; and
  • the maintenance of short-term exposure limits with a maximum peak level of 0.6 f/cm³ over 10 minutes for all types of asbestos.
An Approved Code of Practice supporting the changes in the legislation can be found at http://www.hse.gov.uk/consult/condocs/cd205.pdf.
Says <<CONTACT DETAILS>>, “Any moves to reduce exposure to deadly asbestos fibres are welcome. Sadly however, tighter laws come too late for many people exposed to asbestos earlier in their working lives who have gone on to suffer serious illness as a result.”
Statutory Grievance Letters – Employers Beware
Since 1 October 2004, all employers regardless of size have been required to operate minimum statutory grievance procedures as set out in the Employment Act 2002. There are two different procedures which can be followed, depending on the circumstances. The ‘standard procedure’ involves three steps, which are that:
  • the employee notifies the employer of the grievance in writing;
  • both parties meet to discuss the problem; and
  • an appeal is arranged if requested by the employee.
The ‘modified’ procedure requires the sending of a grievance letter and that the employer responds to the letter. This simpler procedure can be used when employment has ended and the employee and the employer agree, in writing, to its use, provided the standard procedure has not been entered into prior to the employment ending.
An employee who fails to use the statutory minimum grievance procedure is disqualified from bringing most claims in an Employment Tribunal (ET). The first cases concerning the procedures suggest that the courts are taking a broad view as to what constitutes a grievance letter under the Act.
In Mark Warner Ltd. v Aspland, the Employment Appeal Tribunal (EAT) ruled that a letter sent to the employer by the claimant’s solicitor, before the matter was taken to the ET, was sufficient to meet the requirements of the legislation as it gave the employer the opportunity to resolve the complaint and so avoid the need for legal proceedings.
In Thorpe & Soleil Investments Ltd. v Poat & Lake, the EAT held that it is irrelevant whether or not the employee intended to start a statutory grievance procedure at the time of writing a letter of complaint and the employee does not have to comply with any contractual grievance procedure for a letter to constitute a valid statutory grievance. Also, where the standard procedure is used, the letter need only set out what the grievance is, whereas where the modified procedure is used the grievance letter must also set out the basis for the grievance.
Yet further guidance on what constitutes a grievance letter when using the standard procedure was given in Shergold v Fieldway Medical Centre. Here, the EAT held that the statutory requirements are minimal in terms of what is required. It is simply that the grievance must be set out in writing. If the employer needs further information as to the basis of the grievance, this can be obtained before the meeting is held. It made no difference that the grievance was contained in a letter of resignation. The EAT also held that there is no requirement that an employee must comply with any company or contractual grievance procedure. It is simply a question of setting out the grievance in writing so that the employer can understand the general nature of the complaint.
Lastly, in Commotion Ltd. v Rutty, the EAT ruled that a written request for flexible working arrangements under the Employment Rights Act 1996 can constitute a grievance letter, even though the letter does not suggest it should be treated as relating to a grievance.
These cases illustrate the relaxed approach Tribunals will take when determining what is, and what is not, a grievance letter. The purpose of the legislation is to give those involved the chance to settle complaints without recourse to litigation. Employers are advised to ensure that their grievance procedures comply with the law and that employee complaints are dealt with swiftly and carefully. Where an employer fails to deal with a grievance and the employee subsequently wins a claim, the employee will be entitled to an increase i

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