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Evidence about ‘protected conversations’ in an unfair dismissal case?

Yes, if the date of termination is in dispute, held the EAT in Basra v BJSS Limited.

Pre-termination discussions between employer and employee are protected under section 111A Employment Rights Act 1996 and cannot therefore usually be referred to by either party in an unfair dismissal claim, unless there has been “improper behaviour”. In Basra, however, the EAT held that there is an exception to this rule if the date of termination is in dispute.

The Claimant wrote an email to the Respondent in response to a without prejudice offer letter it had sent saying “today will be the last day at BJSS”. The Claimant then stopped attending work, and later brought a claim for unfair dismissal. BJSS argued the Claimant’s employment had ended by mutual termination and, in the alternative, the email was a resignation. The Claimant denied resigning and said he had been dismissed by BJSS at a later date. The tribunal, following Faithorn Farrell Timms LLP v Bailey, noted that s111A protection cannot be waived (unlike without prejudice negotiations) and excluded BJSS’s offer letter as protected under s111A ERA.

The EAT held that as the protection under s111A only applies to pre-termination negotiations, “the chronological line between what is, and what is not, admissible therefore lies on the point at which the contract is terminated”. The EAT went on to say that “where there is a dispute as to whether or not the contract was terminated on a particular date, the tribunal would not be in a position to say what evidence should be excluded until that dispute is determined”. Thus the tribunal needs to determine the termination date before applying s111A

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(ET1) Claim Form – Amending a Tribunal claim to add a new claim – right to argue a time point remains

Is the employment tribunal required, when deciding whether to give permission to amend a claim to add a new claim which may be out of time, to decide the ‘time point’?

Not necessarily, according to the EAT in Galilee v Commissioner of Police for the Metropolis.

An amended claim takes effect from the date when permission is granted, not the date of the original claim.

Therefore, granting permission to amend does not deprive the employer of the right to argue that the claim is out of time.

Further, it is not necessary to decide if the claim is out of time when deciding whether to grant permission to amend, save in clear cases. Permission to amend can be granted subject to the time point being decided at a later stage or the decision whether to grant permission can be deferred to the full hearing

 

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Good news for employee backdated holiday pay claims

In King v The Sash Window Workshop Ltd and anor, the European Court of Justice has held that the means of enforcing the right to paid holiday under the Working Time Regulations 1998 SI 1998/1833 is incompatible with the EU Working Time Directive (No.2003/88). On the EAT’s interpretation of Regs 13 and 16, where an employer grants only unpaid leave to a worker, the worker would be obliged to take leave without pay and then bring an action to claim payment for it. This result is incompatible with the right to paid annual leave under Article 7 read with the right to an effective remedy under Article 47 of the EU Charter of Fundamental Rights. The ECJ also held that, where the employer refuses to pay for annual leave, the worker’s holiday rights carry over until the termination of employment.

K worked for SWW Ltd as a self-employed commission-only salesman from June 1999. He was offered an employment contract in 2008, which included the right to paid annual leave. However, he elected to remain self-employed (under a contract that was silent on the issue). While K did take some holiday throughout his years of service, he was never paid for this. When SWW Ltd terminated his engagement in October 2012, K successfully claimed holiday pay before an employment tribunal, which accepted that he was a ‘worker’ for the purposes of the Working Time Regulations 1998. Among other things, the tribunal awarded him pay in lieu of annual leave accrued but not taken during previous years, also claimed as a series of deductions. The EAT allowed SWW Ltd’s appeal on this issue, holding that the tribunal had failed to make findings of fact to support its conclusion that K was prevented from taking his annual leave for reasons beyond his control. There was therefore no basis for departing from the usual position under Reg 13 that entitlement to leave expires at the end of the relevant leave year. K appealed to the Court of Appeal, which made a reference to the ECJ, querying whether Reg 13 is consistent with the right to paid annual leave under Article 7 of the Working Time Directive, given that (on the logic of the EAT’s analysis) the worker would first have to take unpaid leave before testing his or her entitlement to pay. It also sought clarification of the extent to which untaken paid leave can be carried over, for the purpose of claiming a payment in lieu of untaken holiday upon termination of employment under Article 7(2) of the Directive.

Advocate General Tanchev gave the opinion that employers are bound to provide an ‘adequate facility’ for workers to exercise the right to paid annual leave under Article 7, such as in the form of specific contractual terms or the establishment of a legally enforceable administrative procedure. Where no such adequate facility has been made available, any reference and carry-over periods that would otherwise fall within a Member State’s discretion must necessarily be disapplied. In such a case, the worker would be entitled on termination of employment to payment in lieu of annual leave untaken up until the date on which an adequate facility was made available.

a worker must be entitled to benefit from the remuneration to which he or she is entitled when taking his or her annual leave

The ECJ has now given its judgment and has gone further than the Advocate General. It noted that it was clear from its case law that a worker must be entitled to benefit from the remuneration to which he or she is entitled when taking his or her annual leave. Thus, a worker who is faced with uncertainty as to the level of remuneration to which he or she is entitled during the leave period will not be able to benefit fully from that leave as a period of relaxation and leisure, and is likely to be dissuaded from taking leave in the first place. When seen in that light, the right to paid annual leave cannot, therefore, depend on a factual assessment of the worker’s financial situation when he or she takes leave.

Turning to the Working Time Regulations, the ECJ observed that they implement the right to paid annual leave by way of two separate rights: a right to a period of annual leave under Reg 13 and a right to be paid in respect of that leave under Reg 16. Likewise, Reg 30 provides for two separate judicial remedies. The ECJ noted that, on the EAT’s interpretation of Regs 13, 16 and 30, a worker can claim breach of Reg 13 only to the extent that his or her employer did not permit him or her to take any period of leave, whether paid or not; and can claim payment under Reg 16 only for leave actually taken. This has the effect that, where the employer grants only unpaid leave, a worker is obliged to take leave without pay in the first place and then to bring an action to claim payment for it. The ECJ held that this result was incompatible with Article 7 of the Directive when read with Article 47 of the EU Charter. In K’s particular circumstances, he would be unable to claim after the termination of employment in respect of paid leave due but not taken, which would deprive him of an effective remedy.

As to the accumulation of the right to paid annual leave, the ECJ noted that, in the case of a worker who is prevented from taking paid annual leave due to sickness, case law has permitted national law to limit the worker’s right to carry over that leave to 15 months. That case law took into account not only the protection of workers but also the protection of employers, who might otherwise be faced with the risk that a worker will accumulate periods of absence of too great a length. In contrast, in the present case, there was no requirement to protect the employer’s interests – on the facts, SWW Ltd was not faced with organisational difficulties and indeed was able to benefit from K not taking any paid annual leave. It was irrelevant that SWW Ltd considered, wrongly, that K was not entitled to paid annual leave – it is up to the employer to inform itself of its obligations in this regard and an employer that does not allow a worker to exercise his or her right to paid annual leave must bear the consequences. The ECJ therefore concluded that the Directive requires a worker to be able to carry over and accumulate paid annual leave rights until the termination of his or her employment where those rights have not been exercised over several consecutive reference periods because the employer refused to remunerate that leave.

This case has significant implications for the right to holiday pay in the UK. It suggests that workers who are wrongly classified as self-employed contractors may be able to claim back pay in respect of unpaid annual leave going back many years when their ‘worker’ status is established. It also suggests that the Deduction from Wages (Limitation) Regulations 2014 SI 2014/3322, which limit back pay claims to two years, are incompatible with EU law.

 

ECJ Judgement – Allowance in lieu of annual leave paid on termination of the employment relationship

 

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EAT upholds finding of direct discrimination because of perceived disability

In Chief Constable of Norfolk v Coffey the EAT has upheld the decision of an employment tribunal that a police officer, who was turned down for a transfer to the Norfolk Constabulary because her hearing loss was marginally below the medical standard for police recruitment, had suffered direct discrimination because of a perceived disability. The Constabulary’s reason for refusing the transfer was the concern that the claimant would end up on restricted duties. This indicated that it perceived her to have a progressive condition which, by virtue of paragraph 8 of Schedule 1 to the Equality Act 2010, met the statutory definition of disability.

In 2011 C applied to the Wiltshire Constabulary to become a police constable. She attended a medical, at which it was discovered that she suffers from bilateral mild sensori-neural hearing loss with tinnitus. Although C’s hearing loss was marginally outside the range set down by the Home Office for police recruitment, the Wiltshire Constabulary arranged a practical functionality test which C duly passed before going on to work on front-line duties. In 2013 C applied to transfer to the Norfolk Constabulary. C attended a pre-employment health assessment, where the medical adviser noted that her hearing was ‘just outside the standards for recruitment strictly speaking’ but that she had undertaken an operational policing role with the Wiltshire Constabulary without any undue problems. He recommended that C undergo an ‘at work’ test, but this recommendation was not carried through by the Assistant Chief Inspector (ACI) who dealt with the application. Instead, the ACI declined C’s request to transfer on the basis that her hearing was below the acceptable and recognised standard, and that it would not be appropriate to step outside that standard given the risk of increasing the pool of officers on restricted duties.

C brought an employment tribunal claim for direct discrimination. It was not alleged that she actually had a disability; her case was that her hearing loss did not have, and was not likely to have, a substantial adverse effect on her ability to carry out day-to-day activities, including working activities. Instead, it was argued that she had been treated less favourably because she was perceived to have a disability, in the form of a progressive condition that could well develop to the point of having a substantial impact on her ability to carry out day-to-day activities. The tribunal considered that the only way to read the ACI’s comments about the risk of C ending up on restricted duties was that she perceived that C had a potential or actual disability which could lead to the Constabulary having to make adjustments to C’s role as a front-line police officer. Since this perception was the reason for refusing C’s transfer, the tribunal upheld the discrimination claim.

On appeal to the EAT, it was argued that the tribunal had erred both in respect of its finding that the ACI perceived C to be disabled and its finding that C had been treated less favourably because of that perception. On the former point, the EAT stressed that the question of whether a putative discriminator A perceives B to be disabled will not depend on whether A perceives B to be disabled as a matter of law. It will depend on whether A perceives B to have an impairment with the features which are set out in the legislation. Paragraph 8 of Schedule 1 to the EqA makes special provision in respect of progressive conditions. Where a person has a progressive condition that results in an impairment having an effect on his or her ability to carry out day-to-day activities, but the effect is not a substantial adverse effect, it will still be treated as such if it is likely that the condition will result in a substantial adverse effect in future. Although the ACI protested that she did not consider C disabled with the meaning of the EqA, her knowledge of the law was incomplete and did not include Paragraph 8 of Schedule 1. The reference to the risk of C being on restricted duties could only be read as the ACI perceiving that C had a progressive condition which could worsen. Thus, the tribunal had been entitled to find that she perceived her to be disabled.

Turning to whether the tribunal had been correct to find that there had been direct discrimination, the EAT accepted that a genuine difference in abilities will be a material difference between claimant and comparator. However, it saw no warrant for an employer’s flawed belief in a lack of ability to be a material difference. The tribunal was entitled to conclude that a person with the same abilities as C, whose condition the employer did not perceive to be likely to deteriorate so that he or she would require restricted duties, would not have been treated as C was. C had performed an active policing role in Wiltshire; she had been accepted at the interview stage; her rejection followed when the ACI ignored advice to rely on a practical assessment of C because, as the tribunal put it, she believed the C would become a liability to the force. The tribunal did not err in law in concluding that she had been subjected to direct discrimination.

Link to transcript: http://www.bailii.org/uk/cases/UKEAT/2017/0260_16_1912.html

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Can an employer rely on parts of without prejudice or protected conversations?

Can a Respondent employer rely on parts of a ‘without prejudice discussion’, or protected conversation, whilst at the same time using the rules as a shield?

No, held the EAT in Graham v Agilitas IT Solutions Ltd.

The Claimant was facing termination of employment. During talks which the Respondent characterised as being without prejudice and/or protected under s111A of the Employment Rights Act 1996, the Claimant made comments which the Respondent subsequently used to form the basis of disciplinary action. The Claimant alleged improper conduct/unambiguous impropriety by the Respondent in the form of bullying and threatening behaviours in the same meeting.

The EAT held that the Respondent could not waive privilege on parts of the meeting and rely on privilege in relation to other parts to shield its conduct.

The Claimant was entitled to have the employment tribunal examine the improper conduct. The case has been remitted.

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Does an embassy employee gain diplomatic immunity from claims by their staff

Does an embassy employee have diplomatic immunity in respect of employment claims from his domestic staff?

No, held the Supreme Court in Reyes v Al-Malki. Link to Judgement

Mr and Mrs Al-Malki employed Ms Reyes as a member of domestic staff at their London residence. Mr Al-Malki was a diplomat of the Saudi Arabian embassy in London.

In circumstances very similar to yesterday’s case of Benkharbouche v Secretary of State for Foreign & Commonwealth Affairs & Anor, Ms Reyes began employment tribunal proceedings and alleged that Mr and Mrs Al-Malki mistreated her during her employment and that she is a victim of human trafficking. Those allegations have yet to be determined and the issue for the Supreme Court was whether the tribunal has jurisdiction to hear the claims within the exception to the rule of diplomatic immunity, contained in Article 31(1)(c) of the Vienna Convention on Diplomatic Relations 1961.

The Supreme Court unanimously held that Mr Al-Malki would not be entitled to diplomatic immunity in relation to a claim of human trafficking brought by Ms Reyes because her employment (to carry out domestic tasks) and alleged treatment would not constitute acts performed in the course of the diplomat’s official functions.

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Does the segregation of boys and girls at a co-ed school amount to direct discrimination?

Yes. In HM Chief Inspector of Education, Children’s Services and Skills v Interim Executive Board of Al-Hijrah School, the Court of Appeal has overturned the High Court’s decision that a school’s complete gender segregation of pupils aged 9–16 was not sex discriminatory. In the Court’s view, the High Court had erred by comparing the treatment of boys and girls as two groups and concluding that, since they were both being denied the opportunity to interact/socialise/learn with or from the opposite sex, there was no discrimination. The correct approach under S.13 of the Equality Act 2010 was to look at the treatment from the perspective of an individual girl or boy at the school. The child was being denied the opportunity to mix with the opposite sex, which was a detriment imposed because of the protected characteristic of sex. Thus, the treatment was direct discrimination.
AHS is a voluntary aided faith school for boys and girls aged between four and 16. It has an Islamic ethos and for religious reasons separates boys and girls from Year 5 onwards (when they are aged nine and above) for lessons, trips, breaks and lunchtimes. In June 2016 Ofsted inspected the school, which was later sent a draft of Ofsted’s report rating the school as inadequate and citing concerns about its segregation policy. Ofsted took the view that the policy limited pupils’ social development, and its report pointed out that the school had not considered ‘how to mitigate the potentially negative impact of this practice on pupils’ chances to develop into socially confident individuals with peers from the opposite gender’. Ofsted believed that this gender segregation was unlawful under the EqA. However, there was no suggestion in the report that either boys or girls received a different or qualitatively poorer level of education than the other. The school brought a judicial review challenge to the proposed report. As the most senior official at Ofsted, the Chief Inspector was named as respondent.
Mr Justice Jay upheld the challenge in the High Court (Brief 1062), ruling that Ofsted had been wrong to conclude that there was a breach of the EqA. Given that there was no distinction between the opportunities afforded to girls and boys to interact with each other, it could not be said that one sex was treated less favourably than the other. Furthermore, Jay J held that argument that segregation in a faith school generates a feeling of inferiority as to the status of females in the community is too broad and sweeping an assertion to make in a multi-cultural society, where segregation is not enforced but chosen by parents. Ofsted appealed to the Court of Appeal.
The Court of Appeal agreed with Ofsted’s submission that Jay J had erred by regarding the arrangements at the school as non-discriminatory on the basis that they were ‘separate but equal’. Since the definition of direct discrimination in S.13 EqA refers to a person, it was necessary to view less favourable treatment under that provision from the perspective of an individual pupil, rather than his or her sex as a group. From that perspective, a girl pupil who wished to mix or socialise with a boy pupil was precluded from doing so because of her sex, a protected characteristic; whereas, if she did not have that characteristic, and was a boy pupil, she would have been able to mix or socialise with all the other boys (this was also the case where the genders were reversed). This treatment was clearly less favourable, and the denial of opportunity to mix with the opposite sex was detrimental, as evidenced by the Ofsted report’s finding that segregation had an adverse impact on the quality and effectiveness of the education given by the School to girl pupils and boy pupils respectively. Accordingly, the treatment amounted to direct discrimination contrary to Ss.13 and 85 EqA.
Although it was not necessary, given the above findings on less favourable treatment, the majority of the Court (the Master of the Rolls and Lord Justice Beatson) set out obiter comments refuting Ofsted’s proposition that segregation at the School caused greater psychological harm to girl pupils because the female sex has the minority share of power in society and that power imbalance will be reinforced in adulthood by the loss of opportunity for girls and boys to socialise with each other and to regard each other as equals. The majority considered that, as the Ofsted report itself made no such assertion and there was no evidence from expert educationalists to support the proposition, Jay J had been correct to reject Ofsted’s reliance on this ground. Lady Justice Gloster, by contrast, would also have upheld this ground of appeal. In her view, on the specific evidence before the Court, Ofsted had demonstrated that the sex segregation at the school involved greater practical detriment for girls than boys.

Link to transcript: http://www.bailii.org/ew/cases/EWCA/Civ/2017/1426.html

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ACAS Early Conciliation Certificate valid despite naming 2 Respondents

In De Mota v ADR Network and anor, the EAT has held that an employment judge erred in rejecting a claim on the basis that the early conciliation (EC) certificate named two respondents. Although rule 4 of the Schedule to the Employment Tribunals (Early Conciliation: Exemption and Rules of Procedure) Regulations 2014 SI 2014/254 (the EC Rules) requires a prospective claimant to present a separate EC form in respect of each respondent when contacting Acas, it does not apply to the EC certificate itself, and there is no rule that renders unlawful a certificate that names two respondents.

DM worked as an HGV driver for the Co-Operative Group Ltd (CG Ltd) between 2012 and 2015. He sought to claim unfair dismissal, breach of contract, unlawful deduction from wages, holiday pay and notice pay. His case was that he was employed by, or contracted to work for, ADR, and that ADR assigned him to work for CG Ltd. ADR and CG Ltd disputed this, saying that DM had set up his own company providing his services to ADR, and that ADR provided his services to CG Ltd. DM completed an EC form online. The information provided to online applicants states, in accordance with rule 4 of the EC Rules, that in order to make a claim against more than one respondent the claimant must complete a separate form for each one. However, DM completed just one form, putting ‘ADR Network and The Co-operative Group’ in the box for the respondent’s name. He gave an address which is both the depot of CG Ltd and a business address of ADR. Despite the error, Acas issued an EC certificate, which identified the ‘prospective respondent’ as ‘ADR Network and The Co-operative Group’. DM went on to present his claim to an employment tribunal, naming ADR and CG Ltd as two separate respondents.

An employment judge rejected DM’s claim for non-compliance with the EC Rules. He ruled that the form that DM had submitted to Acas named neither of the respondents but rather a non-existent entity whose name was the conjunction of the names of both respondents. He noted that rule 4 renders it necessary to submit separate forms in respect of separate respondents. He therefore concluded that DM had failed to provide the required information in the prescribed manner and so the tribunal was deprived of jurisdiction by S.18A of the Employment Tribunals Act 1996. DM appealed to the EAT.

The EAT allowed the appeal. His Honour Judge David Richardson, sitting along, noted that, following the EAT’s approach in cases such as Mist v Derby Community Services NHS Trust (Brief 1040) and Drake International Systems Ltd and ors v Blue Arrow Ltd (Brief 1040), it is clear that the purpose of the EC provisions is limited – it is not to require or enforce conciliation, it is simply to build in a structured opportunity for conciliation to be considered. Furthermore, it is no part of the provisions to encourage satellite litigation. HHJ David Richardson pointed out that S.18A ETA, which sets out how the tribunal’s jurisdiction depends on compliance with the EC provisions, focuses upon the existence of an EC certificate. In his view, Parliament did not intend that the process leading up to the certificate should be subject to criticism and examination by the parties or the employment tribunal. For one thing, as was pointed out in Mist, if the prospective claimant does not provide the prescribed information in the prescribed manner, the EC Rules make it plain that Acas is not bound to reject the claim. For another, if it were open to the parties or the tribunal to go behind the certificate, it would also be open to them to challenge Acas’s conduct of the conciliation procedure. Thus, the employment judge erred in law in going behind the certificate and finding that DM failed to provide the prescribed information in the prescribed form to Acas.

HHJ David Richardson went on to hold that the employment judge was wrong to rule, in effect, that Acas had issued an unlawful certificate. Rule 4, which requires individual respondents to be named on separate forms, does not apply to the EC certificate, and there is no similar mandatory requirement elsewhere in the EC Rules. Nor should such a requirement be implied, especially where the effect would be to bar access to the legal system for a litigant based on a technicality. It may be that the issuing of a single certificate was an error on Acas’s part but that is not the same as saying that it was an unlawful certificate. The appeal would therefore be allowed and the claim remitted to the employment tribunal for proceedings to continue.

Link to transcript: http://www.bailii.org/uk/cases/UKEAT/2017/0305_16_1309.html

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Is suspension always a neutral act? – no

Did suspension of a teacher amount to a breach of the implied term of mutual trust and confidence?

Yes, held the High Court in Agoreyo v London Borough of Lambeth. In this case, a teacher was suspended because of the force she used with two children. She had not been asked for her response to the allegations and there was no evidence of consideration given to any alternative to suspension. She resigned the same day.

Foskett J held, following Mezey and Gogay, that suspension was not a neutral act, at least in the context of a qualified professional in a vocation, such as a teacher. Taking into account the statutory guidance for local authorities, it was noted that a knee-jerk reaction must be avoided and that suspension must not be the default position. The reason given for the suspension was not the protection of children, but to “allow the investigation to be conducted fairly”.

The Court concluded that suspension was adopted as the default position, was a knee-jerk reaction, and amounted to a repudiatory breach of contract. This was not undermined by resignation in friendly terms.

NB the court did not have before it the question of whether this case was an attempt to circumvent the statutory qualifying period for unfair dismissal claims and fell within the ‘Johnson exclusion zone’.

Link to the case

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Discrimination claims – New Vento Bands

The Presidents of the Employment Tribunals in England and Wales and in Scotland have published their response to the consultation launched in July 2017 on uprating the bands of compensation for injury to feelings in discrimination cases. The Presidents have decided that the appropriate bands are now: a lower band of £800 to £8,400 for less serious cases; a middle band of £8,400 to £25,200 for cases that do not merit an award in the upper band; and an upper band of £25,200 to £42,000 for the most serious cases, with only the most exceptional cases capable of exceeding £42,000.

The proposal to uprate the bands came as a result of the Court of Appeal’s decision in De Souza v Vinci Construction (UK) Ltd (Brief 1074) that employment tribunals must increase compensation for injury to feelings and personal injury in discrimination cases by 10%, in line with the Court of Appeal’s decision in Simmons v Castle 2012 EWCA Civ 1039. The new bands will be set out in formal Presidential Guidance and will apply to claims presented on or after 11 September 2017. For claims presented before that date, it will be open to the tribunal to adjust the bands to reflect inflation, and the Presidential Guidance will provide the methodology for doing so.

Link to consultation response: https://www.judiciary.gov.uk/wp-content/uploads/2017/07/vento-consultation-response-20170904.pdf

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