It's a trap!

Employment Law Newsletter - October 2014


In this issue ...

  More detailed information   A few more promises, promises...  
  Is there movement?   The October 2014 checklist of changes  
  Carbon copy benefits for fixed-termers?   Not all bets are off  
  Time off for dependants is dependent on prompt action   Little by little?  
  It's not getting any better (for us) or worse (for you)   Mutuality is sometimes overrated  

More detailed information

Our September 2014 issue featured the new rules on shared parental leave. It referred you to various sources of additional information. Now the Government has upped its game on guidance on this administratively tricky subject. It has published an Employers' Technical Guide to Shared Parental Leave and Pay. It is a large document. It can be found by searching the site. Acas has followed suit, with more detailed guidance than was available last month and template documents.

Another way of getting good steer on shared parental leave is to attend one of our half-day briefings at Ryecroft in January 2015. The dates are Wednesday 14th, Thursday 15th, Tuesday 20th and Wednesday 21st. You might already have received, perhaps accepted, a specific invitation to this event, but, if not and you would like to attend, please contact Patrick Collinson ( for further details and/or to register.


Is there movement?

Sometimes, on appeal, dismissal remains the sanction but its nature is changed – from summary dismissal to a termination with pay in lieu of notice. In Rabess v London Fire & Emergency Planning Authority, the Employment Appeal Tribunal (EAT) was invited to conclude that, in such circumstances, the 'effective date of termination' (important for ascertaining by when a tribunal claim must be presented) moved forward to the date upon which the pay in lieu period expired.

The EAT declined to do so. Unless an appeal actually resurrects employment for the duration of a notice period (and, certainly in a disciplinary or poor performance context, that would be quite rare), the effective date of termination will remain that derived from the original summary dismissal.


Carbon copy benefits for fixed-termers?

Now, here's a rarity – an appellate decision under the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002. But the content is helpful to employers in relation to benefits provided and controlled by third parties.

In Hall v Xerox, the EAT had to consider whether it was unlawful for a fixed-term employee to be denied the coverage under income replacement (or permanent health) insurance that a comparable 'permanent' employee would enjoy. The answer was no. Although the fixed-term employee clearly suffers a disadvantage in such circumstances, if the denial of coverage is not the result of the employer's action, but arises from the insurer's policy or decision, there could be no successful claim under the Regulations. The insurer could not be treated as the employer's agent in order to blur the legal distinction between the two parties.


Time off for dependants is dependent on prompt action

And here's another exotic appellate beast – a case about the statutory right to time off for various issues involving dependants.

The ultimate protection for those exercising the right is the automatic unfairness of a dismissal for that reason. That protection was the subject of the EAT's ruling in Ellis v Ratcliff Palfinger. Ellis was already subject to a final written warning for poor attendance. Over a period of four consecutive working days, he did not go to work but accompanied his heavily pregnant partner at hospital. During that time, the only communications received by his employer were on the afternoon of the first day (from Ellis's father) and on the third day (from Ellis himself, but principally through an answerphone message left in the evening). He was dismissed.

He failed with his assertion that the dismissal was automatically unfair because it was for taking statutory time off to assist his dependant who was ill and/or giving birth. The EAT was clear that he was not exercising the statutory right or, therefore, protected by the 'automatic unfair dismissal' rule because he had not complied with the core statutory requirement of informing his employer as soon as reasonably practicable of the reason for his absence. Even if the battery on his mobile phone had run down (as he claimed), he could have re-charged it, borrowed a phone or used the hospital payphone to contact his employer sooner.


It's not getting any better (for us) or worse (for you)

The latest (for the second quarter of this year) statistics on tribunal claims suggest that even the increasingly smoother administration of the remissions system has not offset the effect of the introduction of fees on the number of people willing to bring proceedings against their employer or former employer.

Centrally, the number of single claims received by tribunals is down 70% on the same period in 2013. And contrary to our prediction (in the July 2014 issue) of a gentle climb back to a volume around 40% lower than 'pre-fee' levels, the latest figures actually show a regression from those for the first quarter of this year.

Although a large part of this latest reversal must be attributed to the effects of early conciliation, the continuing general downturn suggests that, almost regardless of the detail of the remission facility, the publicity about fees has become dominant (self-fulfilling?) to the point that some people do not even get so far as exploring whether the superficial financial burden of starting a claim would be mitigated or eliminated in their case.

So, from a litigator's perspective, bad news. But for employers and managers, the opposite.

Of course, change of some form to the tribunal system is on the political agenda anyway. As reported in our July 2014 issue, the Government intends to look at the effects of fees – although, with much consensus (including the CBI) on the need at least for some reduction in levels, other noises emanating from those in the largest party seem to have an element of self-satisfaction about them.

At the other end of our fairly narrow mainstream political spectrum, the Labour Party has to do the usual balancing act. Chuka Ummuna having announced to the TUC Congress that Labour would 'abolish the current system, reform the employment tribunals and put in place a new system', nothing much on this theme was developed as a 'manifesto commitment' at the subsequent Labour Party Conference. And the informed betting is that Labour would not eliminate fees, but, rather, refine means testing so that the 'better off' would pay more and the 'worse off' less. Oh well.


A few more promises, promises...

And what else did the party conference season, the last before the general election, throw up for us?

The Conservatives rested largely on legislative initiatives already underway (zero hours contracts, trafficking of workers). The Liberal Democrats, also with 'credit' for these measures, hardly pushed the boat out – an increase in the national minimum wage (NMW) for apprentices, a 'Workers' Rights Agency' to consolidate enforcement on the NMW, working time, employment agencies and gangmasters' licensing and, to cut discrimination, a 'name blank' application form for use in the public sector.

So the field was open for Labour to produce something of greater note. The manifesto promises were an increase in the NMW to £8 per hour by 2020, companies with more than 250 employees being required to publish the average pay of men and women at each grade, a crackdown on 'rogue employers' (those who exploit migrant workers, use zero hours contracts, avoid the NMW and disregard employment rights) and 'equal rights' for 'the self-employed' (whatever that means). All predictably and understandably short on detail at present, certainly more substantial than the competition, but hardly seismic. We'll just have to wait and see what else emerges in the next six months.


The October 2014 checklist of changes

This month has seen the introduction of:

new hourly rates for the national minimum wage (for those aged 21, the normal rate becomes £6.50);
the right for employees and agency workers to take unpaid time off to accompany their partner to two ante-natal appointments (a maximum of 6.5 hours each time);
the power of employment tribunals to order employers in breach of the equal pay legislation to carry out 'equal pay audits' (see our July 2014 issue); and
increased protection (through the removal of the normal qualifying period for bringing a claim of unfair dismissal) for those whose employment is terminated for a reason connected with their membership of the Reserve Forces.

Not all bets are off

Neither we nor, it seems, our clients are detained too much by the central feature of the Agency Workers' Regulations (AWR) – that a temporary hired worker should, subject to certain conditions, enjoy the terms and conditions that would apply if employed directly by the 'client' or 'host' in a comparable role. And the main reason for that is that the principal responsibility for ensuring compliance lies with the agency. However, the recent decision of the employment tribunal in Stevens v Northolt High School is a useful warning against a hirer's complacency and inaction.

In Stevens, the tribunal found that an agency worker was entitled to almost £11,000 gross that she would have received had her terms and conditions been those the School would have offered to a comparable employee. And because, despite the agency's repeated requests, the School had failed to provide it with full information about its basic employment arrangements (as the AWR require), the tribunal ordered the School, rather than the agency, to pay the full amount (as the AWR permit). So, don't let any such requests for information from employment agencies gather dust!


Little by little?

Many employees and employers might well be struggling to recall the last time that a pay increase was even on the table, let alone a reality. And there remain economic factors militating towards continued restraint – the travails of the Eurozone, an inflation rate that is predicted to be relatively constant at least until next spring and a still patchy domestic labour market. Nevertheless, as 2015 approaches, prudent managers should be expecting, and anticipating, directly (especially in collective bargaining settings) or indirectly (through recruitment, retention and motivation indicators), pressures for 'the lifting of the shackles'.

Data on negotiated pay settlements already show that there have been fewer freezes and more around 3%, particularly in the utilities and the aerospace, defence and automotive sectors (the overall 2014 median is 2.5%). This month, the national minimum wage rises by 3%, a handy benchmark for employees and representatives who, against headlines regularly proclaiming that the UK has turned the corner, want to make up a bit for 'lost time' during the recession. Throw in the recent consensus about an interest rate rise early in the new year and its effect upon inflation thereafter (devalued by political and economic events over the last few weeks, but will people allow that to affect attitudes and expectations?), add to that the nervousness of managers about keeping people in the more buoyant parts of the labour market and the cocktail is complete.

So, to avoid an unnecessarily bumpy ride, now is a critical time for doing your costings, setting your pay strategy and preparing your communications.


Mutuality is sometimes overrated

Mutuality of obligation, in the sense of there being some commitment about the future that holds the parties together between separate assignments or pieces of work, is a crucial element in the existence of an 'umbrella' contract of employment that will link up those discrete chunks of activity (often necessary where continuous service is required for a right).

But, according to the EAT in Windle v Arada, it is not a pre-requisite of someone's being engaged 'under a contract personally to do work' – the additional category protected by the work-related non-discrimination provisions of the Equality Act. So, provided they were required to do any assignment themselves, interpreters engaged by the Government could bring claims of unlawful discrimination based on one assignment even though there was no obligation on either party to get involved in any subsequent assignments.


If you would like to discuss this or any other issue facing your organisation please speak to your usual contact at Collinson Grant or Jo Hale 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.