Employment Law Titles ~ Winter 2007/2008


Age Discrimination – Changes to Benefits
Unlike other forms of discrimination, such as race or sex discrimination, the Employment Equality (Age) Regulations 2006 do allow a defence of justification in cases of direct discrimination, where this is ‘a proportionate means of achieving a legitimate aim’.
In the first major case involving the Regulations, which were introduced in October 2006, the Employment Tribunal (ET) has dismissed a £4.5 million age discrimination claim brought against a City of London law firm (Bloxham v Freshfields Bruckhaus Deringer).
Peter Bloxham, 54, was head of restructuring at Freshfields Bruckhaus Deringer. He brought a claim of age discrimination against his former partners because he had lost out financially as a result of transitional arrangements made when the firm’s pension scheme was being reformed. Had he been a year older, his retirement pension would not have been affected.
The ET found that Mr Bloxham had suffered less favourable treatment compared with partners aged 55 or over and that the treatment would be discriminatory unless justified. However, when considering the test of justification, in the ET’s view, Freshfields did have a legitimate aim in reforming its pension arrangements. Without reform, the scheme in place meant that younger partners would be disadvantaged as they would contribute more but receive smaller pensions. The firm had carried out a lengthy consultation before introducing the changes and no less discriminatory method of achieving the desired reform had been put forward then or since. The ET therefore found that the firm not only met but comfortably passed the test. Its unanimous judgment was that Mr Bloxham’s complaint was ‘not well founded’ and it dismissed his claims of direct and indirect age discrimination.
Says <<CONTACT DETAILS>>, “The outcome in this case will be welcomed by employers who find themselves in a similar situation. It has been reported that Mr Bloxham has decided not to appeal against the decision.”
Age Discrimination Legislation – Challenges
We have previously reported that Heyday, an organisation for people in or nearing retirement, has challenged the Government over the inclusion in the Employment Equality (Age) Regulations 2006 of a mandatory retirement age, on the grounds that this means that the Regulations do not fully implement the EC Equal Treatment Framework Directive 2000/78. Heyday wants the legislation amended to give workers over 65 the same protection from discrimination as younger workers. In order to settle the issue, the matter was referred for judgment to the European Court of Justice (ECJ).
The issue as to whether mandatory retirement ages are inconsistent with the Equal Treatment Directive has now been considered by the ECJ in reference to another case. The ruling was sought by the Spanish Court in the case of Palacios de la Villa v Cortefiel Servicios SA.
Felix Palacios de la Villa brought an action against his employer seeking the annulment of his dismissal after his contract of employment was automatically terminated when he reached the compulsory retirement age of 65. There was a collective agreement in place, governing the employment relations between Sr Palacios de la Villa and his employer, which stated that, ‘in the interests of promoting employment, it is agreed that the retirement age will be 65 years unless the worker concerned has not completed the qualifying period required for drawing the retirement pension, in which case the worker may continue in his employment until the completion of that period’. Sr Palacios de la Villa had completed the pension qualifying period.
The ECJ ruled that a compulsory retirement age set by national law, although discriminatory, was not incompatible with the requirements of the Directive. The prohibition on any discrimination on grounds of age must be interpreted as not precluding national legislation allowing compulsory retirement clauses contained in collective agreements where such clauses provide as sole requirements that workers must have reached the set retirement age and must have fulfilled the conditions set out in the social security legislation for entitlement to a pension, provided:
  • the measure, although based on age, is objectively and reasonably justified in the context of national law by a legitimate aim relating to employment policy and the labour market; and
  • it is not apparent that the means put in place to achieve that aim of public interest are inappropriate and unnecessary for the purpose.
The ECJ accepted that the Spanish practice of allowing the inclusion of compulsory retirement clauses in collective agreements was adopted as part of a national policy which sought to promote better access to employment by a better distribution of work between different age groups, even though this was not stated precisely in the national legislation. It therefore rejected Sr Palacios de la Villa’s challenge against his compulsory retirement.
Says <<CONTACT DETAILS>>, “In the light of this judgment, it seems likely that the UK Government will be able to defeat Heyday’s challenge by justifying the need for a default retirement age as part of its legitimate employment policy.”
In June 2007, an application for a stay of proceedings until the ECJ’s decision on the Heyday challenge was struck out by the Southampton Employment Tribunal (Johns v Solent SD Ltd.). However, the Employment Appeal Tribunal has allowed the employee's appeal against that decision and the Employment Tribunals Service has put all British retirement age discrimination cases on hold pending the ECJ’s ruling. This is not expected until at least 2009.
Company Cleared of Discrimination Against Pregnant Employee
The dismissal of an employee is automatically unfair if the reason for it is that she is pregnant.
The Employment Tribunal (ET) has ruled that a woman who was employed as a press officer at a Northamptonshire hotel was not unfairly dismissed because the decision to outsource her job had been taken before her employer was made aware of her pregnancy.
Samantha Remedios claimed that she had been sacked by Macepark (Whittlebury) Limited, which owned the hotel, after the company found out that she was expecting a baby. She had worked at the hotel for 11 months before being dismissed and her work had been praised by her manager. In Mrs Remedios’s opinion, she was sacked because she was honest about her pregnancy during a routine appraisal interview, but the ET found that the reason for her dismissal was that her services were no longer needed.
However, the ET did criticise the terminology used in a letter sent to Mrs Remedios by the company’s Human Resources manager, calling it ‘nothing short of shambolic’, and made it clear that had Mrs Remedios acquired the employment rights that are gained after being in continuous employment with an employer for one year, the company would have been forced to pay her compensation.
The ET also criticised the company’s decision to let the hotel manager conduct Mrs Remedios’s appeal against the general manager’s decision to sack her, on the ground that a subordinate is unlikely to overturn the decision of a senior manager.
It is unlawful to dismiss or demote an employee or to refuse her vocational training because she is pregnant or on maternity leave. Treating a woman less favourably because of pregnancy or maternity leave is unlawful sex discrimination. It is also unlawful sex discrimination for an employer to turn down a job applicant because she is pregnant. For advice on any discrimination matter, please contact <<CONTACT DETAILS>>.”
Company Road Safety – Police Get Tough
Employers who forget that their health and safety responsibilities extend to employees driving on company business should take note of a shift in the way police will investigate road accidents in future.
Research by the Health and Safety Executive shows that 20 people are killed and 250 are seriously injured each week in traffic accidents involving someone driving for business reasons. This has prompted the Metropolitan Police and several other forces to adopt a policy of investigating company road-safety procedures when an accident involving a work vehicle occurs.
Police will investigate whether the company has carried out basic checks, such as making sure employees using their own cars for business purposes have a valid driving licence, are insured to drive on business and have an MOT certificate for their vehicle. In addition, they intend to investigate the reasons for a vehicle involved in an accident being on the road.
Research by the Parliamentary Advisory Council for Transport Safety has found that employers often fail to consider the dangers posed by employees driving whilst tired. Practices such as expecting employees who drive on company business to work long hours or putting pressure on them to fulfil as many appointments as possible in a given period could be regarded as contributory factors by police investigating the reasons for an accident.
The Corporate Manslaughter Act, due to come into force in April 2008, will make it easier to bring cases against organisations that are negligent in carrying out their health and safety obligations and this causes someone’s death.
Contact <<CONTACT DETAILS>> for advice on implementing a company road-safety policy.
Consultation on Collective Redundancies – Shorter Version
The Employment Appeal Tribunal (EAT) has ruled that the obligation on an employer, under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992, to consult over collective redundancies extends to consultations over the reasons for the closure of a business (UK Coal Mining Ltd. v National Union of Mineworkers). In the EAT’s view, the obligation to consult over avoiding proposed redundancies inevitably involves examining the reasons for the dismissals and that in turn requires consultation over the reasons for the closure.
This is an important decision as it overturns previously binding authority on this area of the law. One difficulty is that EC Directive 98/59/EC provides that an employer should begin consultations when ‘contemplating’ making collective redundancies, whereas this duty is given effect in domestic law as being a duty to consult when an employer ‘proposes to dismiss’ employees as redundant.
The EAT held that as domestic law now stands, the obligation to consult over the avoidance of dismissals has significantly widened the scope of the consultation obligations. In its view, in a closure context, where it is recognised that dismissals will inevitably, or almost inevitably, result from closure, dismissals are proposed at the point when the closure of the business is proposed. Where closure and dismissals are inextricably linked, the duty to consult over the reasons for the closure arises.
Says <<CONTACT DETAILS>>, “It is important that employers are aware of this requirement to consult at an early stage in the decision-making process. Carrying out a redundancy programme always requires care and failure to consult as required can lead to an Employment Tribunal requiring the employer to make protective awards to the dismissed employees. If you are contemplating the closure of a business, or part of one, contact us immediately. We can help ensure that this difficult process is carried out with minimal risk of unanticipated financial consequences.”
Consultation on Collective Redundancies
The Employment Appeal Tribunal (EAT) has ruled that the obligation on an employer, under section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA), to consult over collective redundancies extends to consultations over the reasons for the closure of a business (UK Coal Mining Ltd. v National Union of Mineworkers). In the EAT’s view, the obligation to consult over avoiding proposed redundancies inevitably involves examining the reasons for the dismissals and that in turn requires consultation over the reasons for the closure.
This is an important decision as it overturns previously binding authority on this area of the law. One difficulty is that EC Directive 98/59/EC provides that an employer should begin consultations when ‘contemplating’ making collective redundancies, whereas this duty is given effect in domestic law as being a duty to consult when an employer ‘proposes to dismiss’ employees as redundant.
UK Coal Mining Ltd. took the decision to close Ellington Colliery, a deep mine in Northumberland, after the seam being worked became flooded in January 2005. The 329 employees were represented by the National Union of Mineworkers (NUM) and the British Association of Colliery Management (BACM).
The Unions argued that UK Coal Mining Ltd. had failed in its obligation to consult properly over the mass redundancies. The company claimed that in the light of legal authorities it did not have to consult over the closure itself and the exceptional circumstances surrounding the closure, which it maintained was for safety reasons, also meant that it was relieved from the full duty of consultation.
The Employment Tribunal (ET) accepted that legal authorities did establish that there was no obligation to consult over the closure itself. However, it found no credible evidence that the reason for the dismissals was safety. In its view, UK Coal Mining Ltd. had deliberately misled the Unions on this point. The real reason for the closure of the mine was economic. Even if there were special circumstances, the company had failed in its duty because it had not taken such steps as were reasonable in the circumstances. The ET concluded that there was no consultation at all when the redundancy proposal was still at a formative stage. It awarded the maximum 90 day protective award to the employees.
UK Coal Mining Ltd. appealed against the decision. The NUM and the BACM cross appealed that the ET was wrong to take the view that there was no obligation to consult over the reasons for the closure.
As regards the company’s appeal, the EAT upheld the ET’s decision and the size of the protective award. The ET was entitled to consider that there had been a serious failure to comply with the redundancy consultation requirements on the evidence presented to it. As regards the cross appeal, the EAT held that as domestic law now stands, the obligation to consult over the avoidance of dismissals has significantly widened the scope of the consultation obligations. In its view, in a closure context, where it is recognised that dismissals will inevitably, or almost inevitably, result from closure, dismissals are proposed at the point when the closure of the business is proposed. Where closure and dismissals are inextricably linked, the duty to consult over the reasons for the closure arises.
Says <<CONTACT DETAILS>>, “It is important that employers are aware of this requirement to consult at an early stage in the decision-making process. Carrying out a redundancy programme always requires care and failure to consult as required can lead to an Employment Tribunal requiring the employer to make protective awards to the dismissed employees. We can help ensure that this difficult process is carried out without the risk of unanticipated financial consequences.”
Disability Discrimination – Awareness of Disability
An employer who knows that an employee is disabled must make reasonable adjustments in relation to that person. A recent case at the Employment Appeal Tribunal (EAT) examined the question as to what action an employer must take to gain knowledge of an employee’s disability once they have been put on notice that the employee may be suffering from an illness (Jama v Alcohol Recovery Project).
Ahmed Jama was suffering from post traumatic stress disorder. He is of Somali origin and his mental condition was attributed to events that took place during the civil war in his homeland. He worked for the Alcohol Recovery Project (ARP) in Croydon as a housing worker at a 24-hour hostel for people with alcohol problems. He had a poor timekeeping record and was often absent from work owing to illness. However, these absences were generally described as being caused by physical complaints.
Because of the nature of Mr Jama’s work, it was important that cover could be arranged if he were going to be late or absent, but he often failed to comply with ARP’s procedures relating to prompt notification of absence. ARP had written to Mr Jama’s GP to say that it had advised him to take time off work to seek medical help and the GP had referred Mr Jama for psychiatric assessment.
Mr Jama’s timekeeping did not improve and his sickness absences continued, which led to disciplinary action against him. ARP was aware that he was seeing a psychotherapist for post traumatic stress disorder and he was advised to get a written report on his health. A disciplinary hearing was postponed whilst attempts were made to get this information but Mr Jama failed to produce any evidence of his condition and failed to attend appointments after he was referred to the Occupational Health Service. He was given a final warning.
Unfortunately, matters did not improve. Mr Jama did see a medical officer at the Occupational Health Service and she reported that he appeared fit for normal duties. After a further spell of absence, Mr Jama then gave an untrue explanation for his late arrival at work and he was dismissed because his actions were putting continual pressure on his fellow workers.
Mr Jama brought a claim for disability discrimination. The Employment Tribunal (ET) held that because Mr Jama had post traumatic stress disorder he was disabled within the meaning of the Disability Discrimination Act 1995 but, at that time, ARP did not know and could not reasonably be expected to know that he had the condition and so it was under no duty to make reasonable adjustments to accommodate his disability.
Mr Jama appealed. The EAT upheld the ET’s decision. It found that Mr Jama had failed to produce evidence of his condition and the reasons given for his absences usually related to physical complaints. The other symptoms he complained of were not necessarily caused by post traumatic stress disorder. In its view, although it is insufficient for an employer put on notice that an employee may be suffering from some illness simply to sit back and do nothing, that was not what happened in this case. The employer had attempted on a number of occasions to make enquiries as to what the problems were. It had referred the employee to his GP, it had referred him to the Occupational Health Service and had asked him on a number of occasions for some documentation from his medical advisers, but nothing had been provided.
The EAT therefore concluded that the employer in this case had done all that it could reasonably have been expected to do and the appeal was dismissed.
Disability Discrimination – Employers’ Obligations
The Disability Discrimination Act 1995 (DDA) imposes a duty on employers to make reasonable adjustments to working practices and premises in order to ensure that a disabled employee or job applicant is not disadvantaged.
A question which has sometimes arisen is whether or not a failure to consult a disabled employee regarding possible adjustments that could be made is in itself a failure to make a reasonable adjustment.
The Employment Appeal Tribunal (EAT) has confirmed (Scottish and Southern Energy PLC v Mackay) that the correct approach is that set out in the 2006 case, Tarbuck v Sainsbury’s Supermarkets Ltd, in which the EAT expressly held that whilst it is good practice to consult, the failure to do so does not itself involve an independent breach of any duty to make reasonable adjustments.
Mr Mackay had worked for Scottish and Southern Energy since joining the company as an apprentice electrician in 1980. By 2003, he was working on his own as an appliance repair engineer. He found that changes in working practices increased the work pressure on him and in May 2003 he was certified as unfit to work because of depression. Over the next two years and more, the company sought medical reports, which confirmed that there was little prospect of Mr Mackay returning to his job in the near or even medium future. At one stage he did work for a short time, shadowing other employees at a power station, in the hope that this would help him become fit for work, but the company advised that he could not continue to work in a supernumerary capacity, after which Mr Mackay again became unfit for work.
By May 2005, Scottish and Southern Energy was of the view that it was unreasonable to expect the company to accommodate Mr Mackay’s absence much longer. The company suggested there should be one more medical review and a further meeting at the beginning of August.
On 7 September 2005, Mr Mackay indicated that he would accept a vacancy as a craftsman in the Stornoway power station and would undertake the training required. The company had investigated the possibility of him being able to carry out the job at the power station. His doctor had indicated that this was unlikely unless Mr Mackay’s condition had changed but, if he believed himself capable of doing the work, the doctor thought he would be able to take up the duties some time in the future. However, the company had formed the opinion that he had neither commitment nor enthusiasm for the post and the decision to dismiss him was confirmed by letter on 30 September 2005. Mr Mackay appealed against the decision but the appeal was rejected.
Mr Mackay brought a claim for disability discrimination, on the ground that his employers had failed to make reasonable adjustments, in breach of section 3A(2) of the DDA, and for unfair dismissal.
The Employment Tribunal (ET) noted that in many respects Mr Mackay’s employers had carried out a meticulous and detailed investigation into his condition but found that they had discriminated against him, by reason of his disability, because they failed to consult him fully regarding the possibility of retraining. The ET also concluded that Mr Mackay’s dismissal was unfair. His employer had not specifically broached with him the question of retraining as a mechanical craftsman, when it was known that one of the existing workers was due to retire, specifically to gauge his reaction. In its view, no reasonable employer would have failed to do this.
Scottish and Southern Energy appealed. With regard to the finding of disability discrimination, the EAT found that the failure to consult identified in this case fell within the scope of the decision in Tarbuck v Sainsbury’s Supermarkets Ltd. and so the premise on which the finding had been made was false.
As regards the finding of unfair dismissal, even though there was evidence that the employers had in many respects been extremely solicitous for Mr Mackay’s welfare, the ET had taken the view that it was not possible to form a properly considered opinion on whether Mr Mackay had the commitment to do the craftsman job as the matter had not been raised with him directly. The EAT found that the ET was entitled to reach that conclusion.
Says <<CONTACT DETAILS>>, “This decision provides clarification of the extent of an employer’s duty under the DDA to make reasonable adjustments. However, this is a difficult area of the law and in such cases employers are advised to seek advice on the individual circumstances.”
Employment Bill Published
The Employment Bill had its first reading in Parliament on 6 December 2007. As expected, this will repeal the statutory dispute resolution procedures, which came into force in October 2004. This move follows an independent review of the workings of the procedures which found that they had led to workplace disputes becoming formalised, with lawyers becoming involved at an earlier stage than had previously been the case. Instead, Employment Tribunals will be given discretionary powers to amend awards if parties have unreasonably failed to comply with the ACAS Code of Practice on disciplinary and grievance procedures. The Code is being substantially revised for reissue by the time the Bill is enacted. The Bill also makes changes to the law relating to conciliation by ACAS, removing the fixed periods for conciliation.  
Other provisions included in the Bill are:
  • tough new penalties for employers and employment agencies caught paying less than the National Minimum Wage (NMW) and a fairer method for dealing with NMW arrears so that workers are not disadvantaged;
  • compensation for consequential loss in unlawful deductions from wages and redundancy pay claims;
  • clearer rights for trade unions to determine membership so that they can prohibit individuals who belong or who have belonged to a particular political party. This follows the judgment of the European Court of Human Rights in Aslef v UK.
The Government anticipates that the Bill will receive Royal Assent by summer 2008.
Further information on the Employment Bill can be found on the website of the Department for Business, Enterprise and Regulatory Reform at http://www.dti.gov.uk/employment/employment-legislation/Employment%20Bill%202007%20-%202008/index.html.
Partner Note
The explanatory notes on the Bill can be found at http://www.publications.parliament.uk/pa/ld200708/ldbills/013/en/2008013en.pdf.
Fear of Disease Not Actionable
The House of Lords has recently issued its judgment in a case involving a claim for compensation from employers by employees who had been diagnosed as having ‘pleural plaques’. It has confirmed the earlier decision of the Court of Appeal that damages are not payable.
Pleural plaques are fibrous scar tissue in the lungs and are the result of exposure to asbestos. They are benign, but indicate that the risk of developing mesothelioma and other lung cancers is heightened. It was admitted that the exposure to asbestos was due to negligence on the part of the employers.
The claimants argued that notwithstanding the fact that they had not as yet developed an asbestos-related disease, the increased risk of so doing caused them distress. Most of the claimants sought ‘provisional damages’ – an award based on the probability that they would develop lung disease. The action of one of the claimants was also based on the fact that he had developed clinical depression as a result of the fear he had of developing lung cancer following his becoming aware that he had pleural plaques.
The Lords did not accept that the employer was liable in either case. Development of the plaques was insufficient basis for a claim. They were not of themselves harmful and the mere fear of a future illness was not a factor which could of itself give rise to a claim for damages. In the case of the claimant with the psychiatric injury, the Lords concluded that the injury, though real, was not a ‘reasonably foreseeable’ result of the exposure to asbestos and could therefore not give rise to a claim. In the words of Lord Hoffman, “Applied to the broader question of psychiatric illness, that means that in the absence of contrary information, the employer is entitled to assume that his employees are persons of ordinary fortitude.”
It is understood that the Scottish Parliament intends to introduce legislation to reverse this decision in Scotland.
Partner Note
Grieves v F T Everard & Sons Ltd. and Others conjoined appeals [2007] UKHL 39. See http://www.publications.parliament.uk/pa/ld200607/ldjudgmt/jd071017/johns-1.htm.
Flexible Working Rights
Whilst anyone can ask their employer for more flexible working arrangements, since April 2003 parents and others (such as guardians) who are responsible for looking after children under the age of six years (or 18 years if the child is disabled) have had the legal right to request to work flexible hours and to have their request taken seriously by their employer, provided they have worked for their employer for 26 weeks continuously before the application is made.
From 6 April 2007, this right was extended to those with caring responsibilities for adult relatives. The definition of ‘carer’ is an employee who is or expects to be caring for an adult who:
·        is married to, or the partner or civil partner of the employee; or
·        is a near relative of the employee; or
·        falls into neither category but lives at the same address as the employee.
The ‘near relative’ definition includes parents, parents-in-law, adult children, adopted adult children, siblings (including those who are in-laws), uncles, aunts, grandparents and step-relatives.
With effect from 1 October 2007, changes were made to the list of employees who are eligible to make a request for flexible working in order to care for a child. Specifically, the definition of ‘adopter’ now refers to a person with whom it has been decided to place a child for adoption, rather than a person matched for adoption, and the definition has been expanded to include situations where the child concerned is not being placed for adoption by a UK adoption agency. In practice, this means adoptions from overseas and adoptions by relatives. In addition, private foster carers are now eligible for the right, as are employees who have parental responsibility for a child by virtue of a residence order.
Common types of flexible working are:
  • part-time – working fewer hours, perhaps by working fewer days per week;
  • flexi-time – choosing when to work. There are usually core hours which an employee has to work;
  • annualised hours – the employee’s hours are worked out over a year, often with set shifts with the employee deciding when to work the other hours;
  • compressed hours – working the agreed number of hours over fewer days;
  • staggered hours – having different starting, break and finishing times for employees in the same workplace;
  • job sharing – where an employee shares a job designed for one person with someone else; and
  • home working.
Where the legal right to request flexible working exists, an employer must consider a request seriously and must follow a set procedure and timetable. An employer can only refuse such a request if they can demonstrate a clear business reason for doing so.
If you receive a request for flexible working arrangements and would like individual advice, please contact <<CONTACT DETAILS>>.
Gay Youth Worker – Diocese Will Not Appeal
The Diocese of Hereford has announced that it will not be appealing against the Employment Tribunal’s (ET) decision that the Bishop, the Rt Rev Anthony Priddis, had discriminated against a gay Christian man who applied for but did not get the post of Diocesan Youth Officer (Reaney v Hereford Diocesan Board of Finance).
John Reaney, 42, won his claim in July 2007, under the Employment Equality (Sexual Orientation) Regulations 2003. He had considerable experience as a youth worker and was by far the best candidate for the job. He had given an assurance that he would remain celibate whilst working in the post. However, as Mr Reaney had only recently ended a relationship, the Bishop did not think that he was capable, at that time, of making a promise that he would not enter into another one in the future. He was therefore not satisfied that Mr Reaney met the requirements of the employment. 
In the ET’s view, Mr Reaney had given his assurances on the celibacy issue and it was not reasonable for the Bishop to conclude that this requirement of the post had not been met. In an ordinary employment context, a potential applicant for a job cannot give ‘cast iron guarantees as to circumstances which may happen in the future’.
A spokesperson for the Diocese confirmed that an appeal is not being planned owing to the high cost and length of time it would be expected to involve. There will therefore be a remedy hearing to determine the level of Mr Reaney’s compensation.
Immigration – New English Language Qualifications for Migrant Workers
The Department for Innovation, Universities and Skills has launched new English language qualifications for migrant workers and employers. The new English for Speakers of Other Languages (ESOL) for Work qualifications will make it easier for migrant workers to get the practical English language skills they are likely to need in the workplace. There will be eight ESOL for Work qualifications, each having a slightly different focus and taking a different approach to assessment.
The new qualifications are shorter and more work-focused than traditional ESOL qualifications, giving learners practical English skills in essential workplace matters, such as health and safety and customer service. As well as better accuracy, efficiency and effectiveness, the new qualifications are designed to help employers benefit from improved communication and productivity and there will therefore be a fee payable for the course of study.
It is hoped that the qualifications will enable workers to improve their skills faster than through a traditional ESOL course. They are to be funded and delivered differently from traditional ESOL courses so that learners will be able to bypass the waiting lists that may exist on free ESOL courses.
The cost of the new ESOL for Work courses will continue to be funded by the Government but a contribution will be required from employers, who directly benefit from the provision. The Learning and Skills Council has set the tariff for ESOL for Work at £880. In 2007/08 the fee element is £330, for which the learner or learner's sponsor (employer) is responsible. The initial take up group for the new qualifications is expected to be those people who have come to the country for work and who need skills to function in work, as well as those seeking work at the end of short periods of employment.
Initially, the ESOL for Work qualifications will be available at Entry Level 3 and Level 1. Entry Level 3 is broadly equivalent to the standard expected of an 11 year old. Level 1 is broadly equivalent in difficulty to an English GCSE at grades D to G.
A leaflet on the new qualifications can be found at
Immigration – New Rules for Students and Colleges
From 1 November 2007, certification under the Academic Technology Approval Scheme (ATAS) became a mandatory requirement within the Immigration Rules for students from non-EU/EEA countries who intend to enter or remain in the United Kingdom for more than 6 months to undertake postgraduate studies or research in certain designated subjects, such as certain science, engineering and technology disciplines. The move is designed to stop the spread of knowledge and skills that could be used in the proliferation of weapons of mass destruction and their means of delivery.
The ATAS will also apply to those who are enrolled on an overseas course that is similar in subject matter to those covered by the scheme and who intend to come to the UK for more than 6 months in order to undertake a period of study/research which forms part of the postgraduate overseas course.
Students wishing to come to, or extend their stay in, the United Kingdom for such a purpose are now required to provide a valid ATAS clearance certificate with their application for an entry clearance or an extension of stay. Failure to provide a valid clearance certificate will result in the application being refused.
Further information can be found on the website of the Foreign and Commonwealth Office at http://www.fco.gov.uk/servlet/Front?pagename=OpenMarket/Xcelerate/ShowPage&c=Page&cid=1186674480243.
The new rules are part of Britain's new Points Based System (PBS) for managing migration. Any college recruiting students from abroad will in future need to be registered on a new Home Office Sponsors' Register. To qualify for the register they will have to show that they have been accredited by an approved body. This measure is designed to prevent a bogus institution acting as a front for the entry of illegal immigrants into the country.
For further information on the new rules for colleges that teach overseas students, see the website of the Department for Innovation, Universities and Skills at http://www.dius.gov.uk/press/24-07-07.html.
Immigration – Tougher Penalties for Hiring Illegal Workers
The Government is introducing new measures aimed at preventing illegal working in the UK. Under a new system of civil penalties, employers who negligently hire illegal workers could face a maximum fine of £10,000 for each illegal worker found at a business. If employers have knowingly hired illegal workers they could incur an unlimited fine and be sent to prison.
The new measures will take effect in February 2008 and are part of a shake-up of the entire immigration system. This includes the introduction of a Points Based System for managing migration, which will consist of a five-tier framework. For each tier, applicants will need sufficient points to obtain entry or leave to remain in the UK. All but the most highly skilled immigrants will require a sponsor (normally their employer) who will be responsible for ensuring that a migrant worker complies with the rules of their entry to the UK and returns home at the end of their stay. Tier 1 of the system, which caters for highly skilled migrants such as scientists and entrepreneurs, is expected to be introduced on 4 March 2008.
The Border and Immigration Agency will be issuing a code of practice giving guidance on how employers can avoid employing illegal migrant workers whilst at the same time avoiding actions that could make them liable to a charge of race discrimination.
Sponsorship Under the Points Based System
The Government has now published a Statement of Intent for sponsorship under the Points Based System. This will apply to migrants other than nationals of the European Economic Area and those in Tier 1. The new licensed sponsor system is due to be introduced in the first quarter of 2008. When implemented, a licence will be needed to bring migrants to the UK. No one will be granted a licence without being approved in advance by the Border and Immigration Agency.
The Statement of Intent can be found at http://www.ind.homeoffice.gov.uk/6353/aboutus/sponsorshippointsbasedsystem.pdf.
In Brief
ACAS Guidance on Holiday and Holiday Pay
The Advisory, Conciliation and Arbitration Service (ACAS) has updated its guidance for employers on staff holiday pay entitlements to take account of the increase in the statutory minimum annual holiday entitlement to 24 days, which came into effect on 1 October 2007. The guidance clarifies the law in a useful question-and-answer format.
Subjects covered include the entitlement of agency workers and casual workers to paid leave, an explanation of the accrual system that employers can opt to use to calculate how much leave a worker has built up during their first year of employment and the rules on carrying leave over from one holiday year to another.
The guidance is available on the ACAS website at http://www.acas.org.uk/index.aspx?articleid=806.
In Brief
Age Discrimination Cases on Hold
Following a Practice Directive handed down by the President of Employment Tribunals, all age discrimination cases in England and Wales that relate to dismissal on the grounds of retirement arising under Regulation 30 of the Employment (Equality) Age Regulations 2006 (which provides for lawful retirement at or over age 65) are being stayed pending the ruling of the European Court of Justice on a challenge to the legality of UK retirement law made by the Heyday organisation. Heyday wants the legislation amended to give workers over 65 the same protection from discrimination as younger workers. The judgment is not expected until at least 2009.
Partner Note
The Practice Direction can be found at
In Brief
Hazards at Work – Updated Guidance
The second edition of the TUC's guide to health and safety at work is now available. The text has been revised and updated and includes chapters on smoking and asbestos as well as updates on relevant statutes, including the new Corporate Manslaughter and Corporate Homicide Act 2007, due to come into force in April 2008.
The 352-page book has a chapter on all major hazards at work. Each covers basic facts, examines who is at risk, looks at legal and other standards for prevention and control and gives information on the Health and Safety Executive and other guidance.
The emphasis is on ensuring that those with health and safety responsibilities are well-organised and are more involved in good practice.
Hazards at Work can be ordered online at www.tuc.org.uk/publications. The cost is £18.00 to TUC members or £45.00 to non-members.
In Brief
Short-Term Agency Workers – Entitlement to SSP
The Government is to take steps to amend the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002 to ensure that agency workers on contracts of less than three months are entitled to Statutory Sick Pay (SSP).
This decision follows a ruling by the Court of Appeal (Commissioners for HMRC v Thorn Baker Limited and Others) that two agency workers on short-term contracts were not entitled to SSP because the Regulations, although intended to make it unlawful to discriminate between permanent and temporary employees, maintained the restriction on entitlement to SSP in relation to agency workers on short-term assignments.
Is a Director an Employee?
When a company becomes insolvent, whether or not a shareholder and director is an employee, within the meaning of section 230 of the Employment Rights Act 1996 (ERA), for the purposes of a claim for statutory redundancy payment from the Secretary of State for Trade and Industry, can be difficult to ascertain. The Employment Appeal Tribunal (EAT) considered this issue in the case of Nesbitt and Nesbitt v Secretary of State for Trade and Industry.
Mr and Mrs Nesbitt were directors of APAC Computer Training Ltd. They managed the company on a day-to-day basis and between them owned 99.99 per cent of the shares. From the start, they had written contracts of employment with the company, in the same form as those of other company employees. They were paid salaries commensurate with their roles as the senior managers of the business but did not receive directors’ fees or dividends.
In the course of 2006, the company became insolvent and on 3 July of that year the remaining employees, including Mr and Mrs Nesbitt, were made redundant by the liquidator. The couple applied to the Insolvency Service for redundancy payments under the insolvency provisions of the ERA. Their claims were rejected on the ground that they were not employees within the meaning of the Act.
The Employment Tribunal agreed with the Insolvency Service on the basis that the Nesbitts were in joint control of the company.
The EAT overturned this decision on appeal. In its view, the fact of the Nesbitts’ control over the company was not sufficient of itself to deprive them of employment status if they otherwise satisfied all the criteria for employment. Mr Justice Underhill stated, “I believe that the law is that the fact that a claimant under the employment protection legislation is a majority shareholder and a director of the company which employs him does not affect his status as employee unless the tribunal finds that the company is a ‘mere simulacrum’… and thus, by the same token, that the contract between it and the putative employee is a sham.”
In this case, apart from the level of control they had over the company, all the indications were that Mr and Mrs Nesbitt were employees. They had proper employment contracts (equivalent to those issued to other employees), they received all their remuneration by way of salary and they ‘behaved like employees’.
Says <<CONTACT DETAILS>>, “One of the relevant factors to be taken into consideration in cases such as this is the contract of employment. We can assist you to ensure that your employment terms make sure you have the appropriate contractual relationship with your company.”
Managing Risks –  Advice on The Corporate Manslaughter and Corporate Homicide Act
The main parts of the Corporate Manslaughter and Corporate Homicide Act 2007 are due to come into force on 6 April 2008.
The Act establishes a new offence where there has been a gross failure in the way a company has organised or managed its health and safety activities which results in someone’s death. The new offence will be called corporate manslaughter in England, Wales and Northern Ireland and corporate homicide in Scotland.
Employers should take the opportunity to consider how they manage all workplace risks to ensure that they are not vulnerable to criminal charges under the Act.
The Government has published useful guidance on the new Act which can be found at http://www.justice.gov.uk/guidance/manslaughteractguidance.htm.
Organisations found guilty of the new offence will be liable to a fine, a remedial order and a publicity order. The sanction of publicity orders will not come into effect until the Sentencing Guidelines Council has issued guidance on how courts should use this new sanction.
If you would like advice on how health and safety law affects your business, please contact<<CONTACT DETAILS>>.
Maternity Leave – A Woman’s Rights
Employers with staff absent on maternity leave should be aware that a failure to offer them the same rights and opportunities as their colleagues could result in claims of sex discrimination.
The legislation governing a woman’s rights whilst absent from work on maternity leave requires that the time must count as continuous service and be included where it affects her promotion. She is also entitled to be fully consulted about any changes affecting her job and should be notified of any career opportunities that become available during this time. If on returning to work after maternity leave an employee finds that she has been demoted, or her job has materially changed, she may also be able to claim constructive dismissal.
A woman in Scotland was recently awarded £20,000 in an out of court settlement after she claimed that her employer had failed to offer her the chance of promotion whilst she was absent on maternity leave and had downgraded her status on her return to work.
Melanie Given had worked for two years as an accountant for an offshore oil-services company, Offshore Hydrocarbon Mapping, in Aberdeen. She threatened to bring a claim of sex discrimination against her employer because her role when she returned to work after having a baby carried less responsibility and status than before and she was not offered the chance of applying for promotion during her absence. The company had initially appointed someone on a temporary basis to cover for Mrs Given while she was on maternity leave. However, that person was made a permanent member of staff and took over Mrs Given’s duties in a newly created and more senior post.
Because her role had been so much reduced, Mrs Given felt ‘pushed out’ and was absent from work for two months suffering from stress and anxiety.
Offshore Hydrocarbon Mapping did not admit any culpability and said that the decision to settle the claim was made purely on economic grounds.
Mrs Given’s case was supported by the Equal Opportunities Commission Scotland.
“It is important to have systems in place to ensure that the rights of women on maternity leave are not ignored,” says <<CONTACT DETAILS>>. “Contact us for individual advice on the specific rights relating to ordinary and additional maternity leave.”
Maternity Pay Increases Delayed
When the Work and Families Bill received Royal Assent, in June 2006, the Government announced that as well as increasing the entitlement to Statutory Maternity Pay, Statutory Adoption Pay and Maternity Allowance to 9 months, which took effect in April 2007, its ambition was to increase this to a year’s paid leave by the end of this Parliament.
In addition, a new right to an additional period of paternity leave for fathers was announced, to be introduced alongside the extension of Statutory Maternity Pay, Statutory Adoption Pay and Maternity Allowance to 12 months. This will enable fathers to benefit from leave and statutory pay of up to 26 weeks to care for their child in the first year if the mother returns to work and has not used up her full entitlement to paid maternity leave.
HM Revenue and Customs (HMRC) had been planning for these changes on the basis that they would be introduced for babies due to be born on or after 1 April 2009. However, whilst it remains the Government’s goal to introduce the changes before the end of this Parliament, it has announced that they will not be implemented in April 2009.
HMRC are now planning for the new measures to be introduced for babies due on or after 1 April 2010, but have made it clear that no final decision has been taken as to the exact timescale for implementation.
Music While You Work
If you allow your staff to listen to music whilst working, the Performing Rights Society (PRS) has warned that you could be liable to pay a licence fee.
PRS is a not-for-profit organisation that licenses the public performance of music on behalf of its 50,000 composer, songwriter and music publisher members. It pays its members royalties for each time a piece of their music is played in public.
According to PRS, a tariff for music in the workplace applies to ‘the mechanical performance within the society’s repertoire as a background to work, meals, stand-down times and breaks at work’.
PRS is taking Kwik Fit, the automotive parts repair company, to court for violating musical copyright because it claims that the company’s mechanics play the radio loudly enough for it to be heard by colleagues and customers. In the view of PRS, this constitutes a ‘performance’ of the music, which requires the payment of royalties to the artists. PRS is claiming £200,000 in damages because Kwik Fit has refused to obtain the appropriate licences, claiming that the company has a policy banning the use of radios at its premises.
For those who allow music to be played at work, the situation is complicated by the fact that you may also need a licence from Phonographic Performance Ltd. (PPL). PPL collects and distributes airplay and public performance royalties in the UK on behalf of over 3,500 record companies and 40,000 performers.
The cost of a licence depends on how the music is used. For further information, see the PRS website at http://www.mcps-prs-alliance.co.uk/Pages/default.aspx and the PPL website at http://www.ppluk.com/.
Rastafarian Loses Discrimination Claim
The Employment Equality (Religion or Belief) Regulations prohibit direct discrimination, indirect discrimination, victimisation and harassment in the workplace on the grounds of any religion, religious or philosophical belief.
A man has lost his appeal to the Employment Appeal Tribunal (EAT) that he was the victim of indirect discrimination because he is a Rastafarian and wears his hair in dreadlocks (Harris v NKL Automotive Ltd.).
Mr Harris worked as a driver for NKL Automotive through an agency. He complained that he was being given less work than the other agency drivers and, unlike some of them, he was not taken on by NKL Automotive as a full-time employee. The company felt that he did not represent it well but was willing to continue to use him as an agency driver, provided he tidied up his hair. The company had a dress code policy which required that drivers ‘should have a smart professional haircut and should ensure hair is tidy’.
Mr Harris felt that he was being discriminated against because of his Rastafarian beliefs and brought a claim for direct and indirect discrimination on the grounds of his philosophical beliefs and of victimisation discrimination.
The Employment Tribunal (ET) accepted that Rastafarianism is a religious belief within the meaning of the Regulations. However, it rejected the claim of direct discrimination because NKL Automotive did not know of Mr Harris’s Rastafarian beliefs. With regard to the claim of indirect discrimination, the ET found that Mr Harris had long hair when he was taken on as a driver and was not denied the opportunity of continuing as an agency driver provided his hair was tidy. A general standard of tidiness applied to all drivers and the ET took the view that to require hair to be tidy is a proportionate means of achieving the aim of a presentable appearance to customers.
The ET also concluded that Mr Harris had not been victimised by the agency but did not consider the allegation of victimisation by NKL Automotive. It did, however, conclude that the company had adopted a ‘dismissive and unfortunate approach when dealing with his grievance in a somewhat peremptory way’.
Mr Harris appealed against the finding that there was no indirect discrimination and alleged that the ET had not given proper consideration to the victimisation discrimination claim.
The EAT remitted the question of victimisation discrimination to the same ET for consideration. As regards the claim of indirect discrimination, it rejected Mr Harris’s argument that the requirement to have tidy hair is prejudicial to Rastafarians. In the EAT’s view, ‘if dreadlocks are compatible with tidy hair, or can be kept in a tidy manner, then the criterion does not in any way discriminate against those with dreadlocks’. The ET’s finding was that the company did not object to hair worn in dreadlocks if tidy.
Says <<CONTACT DETAILS>>, “Employers who impose dress code restrictions should take care that these can be justified and do not discriminate against employees of a particular race or those holding particu

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