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Employment Law Newsletter - April 2012


Still picking on the wife

Our last issue featured the EAT's decision in Dunn – suggesting that discriminating against an employee for being married to a particular person would be discrimination on the grounds of 'marriage'. But in Hawkins v Atex, another division of the EAT has said that goes too far. It now distinguishes between less favourable treatment solely because of marriage (unlawful) and such treatment because of a close relationship with another person that happens to take the form of marriage in the particular case (not unlawful). Mrs Hawkins was dismissed by her employer, for whom her husband was a manager, when it applied a policy prohibiting the employment of close relatives. Her claim of unlawful 'marital' discrimination failed, because, as the dismissal of her daughter at the same time showed, her treatment was not attributable solely to the fact of her being married to Mr Hawkins.

The Hawkins analysis and decision effectively illustrate the point made in the last sentence of our piece on Dunn – that, ultimately, the issue is one of causation (being married or something else).

The changing face of dismissal law

The well-publicised increase in the qualifying period for 'general' unfair dismissal has just taken effect. But, be careful. The requirement for two years' service only applies to those starting on or after 6th April. Anyone starting employment on 5th April will need only one year's service. And, in any event, do not under-estimate the capacity of claimants (or their advisers) to find ways of challenging dismissal that do not depend on length of service. Discrimination is one. 'Whistleblowing' is another, and seems to have become more popular recently.

Meanwhile, the Government has recently issued a 'call for evidence', paving the way for consultation on specific proposals, about the effectiveness of dismissal law. Its principal line of enquiry is whether the rules and processes are too onerous or too complex. It also moots allowing 'no fault' dismissals, where a pre-determined amount of compensation would be paid, for 'micro businesses' (those with fewer than 10 people). Views from interested parties should be submitted by 8th June.

Anything goes?

Employers have to apply rigorous, objective and consistent standards when selecting people for redundancy from a 'pool', but not when assessing people whose old jobs are redundant for new ones. In Samsung v Monte D'Cruz, three managerial jobs, including the claimant's, were abolished and those affected were invited to apply for others. They were unsuccessful. An external candidate was appointed. The claimant then challenged the fairness of his dismissal. There had been, he alleged, a lack of objectivity in the factors used to choose whom to appoint. The competencies used in the employer's appraisal process had been applied by an interview panel without any agreement on their detailed definitions. The EAT denied there was unfairness. It acknowledged that objectivity could not be discarded altogether at this point. But some subjectivity was inevitable when assessing suitability for a new job. And 'subjective' was not always a dirty word.

The limits of confidentiality

Lots of contracts place employees under a contractual obligation to maintain confidentiality. But can an ex-employer use such a clause to get an injunction stopping the ex-employee from joining a competitor? No, said the CA in Caterpillar Logistics v Huesca de Crean. So, if you want to have a realistic chance of restraining the destination or activities of employees when they leave, ensure you have appropriate, specific, post-termination restraints in their contracts.

Keeping us in suspense

The claimant in Crawford v Suffolk Mental Health NHS Trust was the subject of an allegation about her mistreatment of a patient in care. The employer reported the matter to the police and, pending investigation of the alleged gross misconduct, suspended her under its own disciplinary procedure. Dealing with her claim that her subsequent dismissal was unfair, the CA described the referral to the police as 'little short of astonishing'. Employers should not subject employees to the burden of the criminal process without careful consideration and a reasonable belief that the label 'criminal' could apply to the circumstances.

Nothing particularly surprising there. But more interesting is the aside that suspension should not be a 'knee-jerk reaction' – otherwise, in belittling and demoralising the employee, it will be a breach of trust and confidence. Taken literally, that basic observation is also non-contentious. However, our experience is that it is already being used to seek to discourage employers from suspending when that measure is justified by the seriousness of an allegation (and when, if there were no suspension, the employer would probably be roundly criticised for failing to underline to the employee the gravity of the charge and the potential outcome). So, our message is 'keep calm and carry on'. If the initial investigation reveals prospective gross misconduct, suspension should be the normal response – just ensure that it is not unnecessarily prolonged (in Crawford, it lasted for some six months, a fact that might provide the proper context for the CA's observation about suspension).

The limits of non-solicitation clauses

Non-solicitation clauses seek to prevent former employees from touting for business with their former employers' customers. Non-dealing clauses look to stop ex-employees actually doing business with those parties. In Towry EJ v Barry Bennett, the claimant employer's contracts of employment contained the former but not the latter. When some employees left and joined a competitor, a large number of clients moved their business to the competitor. But there was no direct evidence that the employees had done anything to instigate the switch. The court held that the claimant employer was unable to use the non-solicitation clause to get an injunction to stop its (now) former employees conducting this business, because it was quite possible that the clients had moved out of nothing more than a sense of loyalty to the people they were used to dealing with. A contractual non-dealing clause, the application of which depends on the establishment of a much simpler fact, would have allowed the former employer to restrain its departed staff from working with the clients. Do you have one in the contracts of appropriate employees?

Sexual orientation trumps religious belief?

In Bull and Bull v Hall and Preddy, the CA ruled that, in refusing to allow civil partners to share a double bed at their hotel, the owners had discriminated on the grounds of sexual orientation. Even though the refusal was prompted by their Christian beliefs, the owners derived no protection from Article 9 of the European Convention, because that did not entitle them to disregard the law.

It might be suggested that this decision helps to create a hierarchy of 'protected characteristics' under the Equality Act in which religion or belief is inferior. But that characteristic is unique. All the others involve an attribute that cannot readily be adapted or moderated to circumstances. Religion/belief often entails the active manifestation of attitudes that, however unpalatable to the believer, can be adjusted to accommodate others. When, as in Bull, there is no such adjustment and that results in discrimination against others, something has to give. But, of course, in other respects, the detrimental treatment of a person on grounds of belief attracts the same protection as the other characteristics.

A stream of consciousness - 'organised grouping of employees'

Employees can only pass between employers under TUPE if they are 'assigned' to the operation that is being transferred. But, for situations coming under the 'service provision change' definition, there is, before 'assignment' is considered, another requirement that must be satisfied – there must be an 'organised grouping of employees' already working on the particular service. In Eddie Stobart v Morman, the EAT considered the relationship between these two concepts. The employees worked at a warehouse servicing several clients. Eddie Stobart (ES) closed the site, whereupon another company (F) took up the work for one of these clients (V). ES considered that those employees who worked at least 50% of their time on V's contract should transfer under TUPE to F's employment. The EAT ruled that, as it was an alleged service provision change, the first question was whether, so far as the work for V was concerned, ES had operated an organised grouping of employees at all. Leaning on the expression 'organised grouping', it found that there was no conscious or deliberate dedication of employees to particular clients. Who worked for whom depended on ES's shift rotas. So there was no organised grouping of employees and, therefore, no service provision change under TUPE. So, the second question, of an employee's 'assignment' (under which the 50% test might have been relevant), was never reached.


Working over time and being paid overtime

In Blair v Hotel Solutions, cleaners were required to service a specified number of hotel rooms in their working day of seven hours. They said that it was not practicable for them to meet this target without encroaching on their unpaid lunch hour. So, in the form of a claim for unlawful deduction from wages, they sought overtime pay for the time spent cleaning during the contractual lunch break. Given the absence of a request for overtime from the employer, the EAT refused to uphold the claim. It said that, under the terms of the contract, overtime was clearly voluntary, so that the cleaners were quite entitled to do seven hours' daily work and no more. That stance might then attract measures or sanctions from the employer, which would, in turn, be matters for assessment under law.

If you would like to discuss this or any other issue facing your organisation please speak to your usual contact at Collinson Grant or Richard Hendry on 0161 703 5600

If you would like to discuss this or any other issue facing your organisation please speak to your usual contact at Collinson Grant or Richard Hendry on 0161 703 5600

Although care has been taken in the preparation of this Newsletter, Collinson Grant cannot accept responsibility for errors, omissions or advice given. Readers should note that only Acts of Parliament and Statutory Instruments have the force of law and only the courts can authoritatively interpret the law.