It's a trap!

Employment Law Newsletter - September 2014


In this issue ...

  It's about time   It may have made no difference, but...  
  A complete non-transfer   Double jeopardy  
  Location, location – but does it count for anything?   Turning over every stone?  
  Illegality has its limits   Feelings are worth more  
  'Cheaper at half the price'   Another £30,000 under scrutiny  
  The old order is restored   The twilight zone  
  'You started it...'   You pays your money, you takes your choice...  

It's about time

As they return from holidays for the 'new term', even those employers and managers with a limited understanding of human biology will be able to work out that, if the new rules on shared parental leave are available in relation to babies due on or after 5th April 2015, it will not be long before employees begin to enquire about or exercise the new rights. So, an awareness of what's involved is handy. As with all schemes associated with parental time off, the rules are detailed, 'administrative' and, generally, quite anodyne. That, and the availability of other sources of information (see below), means that, having reminded you of their advent, we shall avoid an extensive recital of them here.

However, in summary, up to 50 weeks' leave can be shared between the parents and must be taken within the 52 weeks immediately following the birth. The actual amount of time available as shared leave will be dependent upon the time the mother chooses to take first as 'pure' maternity leave. The two weeks compulsory maternity leave straight after the birth, in place for health reasons, must remain.

Once the mother has curtailed her maternity leave, she and her partner can take shared leave either consecutively or concurrently and, in either case, each employee can apply to take his or her element in one go or discontinuously. In the latter instance, the employer can reject a single application for discontinuous leave, but, as each employee has the right to submit up to three separate notices requesting periods of leave, he or she can get round things. In any event, leave must be taken in 'full week' blocks.

Similar arrangements will apply for adoptive parents where a child is due to be placed for adoption on or after 5th April next year.

Just to complete the picture, or state the obvious, shared parental leave is an option – if it is not used, the current arrangements for maternity, adoption and ordinary paternity leaves remain in place (but not additional paternity leave, which is too close to shared parental leave to survive).

Back to those other sources of information. Employment law for line managers 2014 – 2015, which many of you will have received in the last two or three months, contains (centrally at page 51) a slightly fuller description of the salient features. The 'Advice and Guidance' section of Acas's website leads to a handy summary with practical pointers. And an official guide, with some worked examples, can be found at


A complete non-transfer

During the summer holidays, those of us who are football fans got used to the media's rumour mill on the possible transfer of top players between big clubs. Of course, many of these supposed moves were based on little more than the wish or imagination of a manager, player or agent and, so, did not transpire. Employment law has a similar capacity to produce flights of fancy on the part of one or other protagonist. And, under TUPE as with professional football, the result can also be the 'non-transfer', as is comprehensively illustrated by Horizon Security Services v Ndeze & The PCS Group.

PCS had been taken on by W to provide security services for a business centre that W was managing on a site owned by a local authority. When the local authority took the site back from W, it engaged a new security firm, Horizon, to look after things for a maximum of nine months pending demolition of the business centre to make way for a new supermarket. Did the employees of PCS transfer to Horizon under a TUPE 'service provision change' (SPC)?

Applying the Court of Appeal's principle from Hunter v McCarrick, the Employment Appeal Tribunal (EAT) said not. The client for whom the services were provided had to remain the same on either side of the changeover and here it did not – PCS's client was W and Horizon's was the local authority.

But, as if that was not enough, the EAT also found that, because Horizon's arrangement was intended by the local authority to concern an event or task of short-term duration, it was precluded from being an SPC by Regulation 3(3)(a)(ii) of TUPE. Game over.


Location, location – but does it count for anything?

In Cetinsoy v London United Busways, the EAT had to consider Regulation 4(9) of TUPE. This allows an employee to resign and treat themselves as dismissed when, in the context of a transfer, there is or will be 'a substantial change in working conditions to [the employee's] material detriment'. It is wider than the definition of 'constructive' dismissal, which is only met if there is a repudiatory breach of the contract by the employer.

Cetinsoy and colleagues were bus drivers, who operated the 'Number 10 bus' route. The base of this route was moved from one depot to another, about 3.5 miles away. The drivers did not find this convenient. The question was whether this was a substantial change to their material detriment (if it was not, it would not be significant enough to amount to a repudiation of contract even though it was a technical breach).

The EAT said that, in the circumstances, it was not. The effects of the change – the most obvious of which was a maximum increase in each way commuting time of 30 minutes - was relatively slight, particularly in the context of preserving jobs and the greater detriment caused by relocation to another of the employer's depots. So, unlike the earlier case of Abellio London v Musse (in which a relocation between bus depots 6 miles apart was found to have the opposite effect), the resignations of the drivers were not converted into dismissals.

Of course, even where a change does satisfy Regulation 4(9), it is now possible that the resulting dismissal will still produce no 'result' for the former employee. One of the early 2014 amendments to TUPE (see our January 2014 issue) was to make the change of workplace location an 'economic, technical or organisational (ETO) reason entailing changes in the workforce' and so capable of justifying dismissal.


Illegality has its limits

More than two years ago (see our June 2012 issue), we covered the Court of Appeal's decision in Hounga v Allen. It was to the effect that the undeniably humiliating treatment of a Nigerian national could not be the subject of a discrimination claim because, having falsely obtained a visitor's visa, she had no right to work or, ultimately, to remain in the UK and, so, the contract upon which a discrimination claim would be materially based was illegal.

The Supreme Court has disagreed with this analysis. The doctrine of illegality did not apply to exclude Hounga. While the immigration offence (committed under duress from her employer) provided the setting in which the discrimination occurred, the connection between the two things was not sufficiently close to prevent her claim proceeding.


'Cheaper at half the price'

If managerial attention to proper recruitment, training and performance management is a message still lost on many, try this – according to a recent study by Oxford Economics across the retail, legal, accountancy, advertising and technology sectors, the average cost of replacing an employee is £30,000.

Over 80% of that sum comes from the typical loss of productivity or efficiency before a new recruit gets up to speed. The remainder is derived from agency and advertising charges, managers' time and, in some instances, paying temps pending the recruitment of a 'permanent' employee.

So, while it is possible to argue about the precise, or even broad, figure here, it is clearly significant enough by any standards to warrant attention to strategies for effective recruitment and for employee engagement – such as making work meaningful and linked to an individual's skills and abilities, providing opportunities for development and for promotion or career progression, and ensuring that managers are effective and exemplary leaders. An audit of your organisation's HR strategy and practices, including but not limited to the role of your HR department, might help in sharpening these things up. Let us know if you agree and would like to discuss this approach in more detail.


The old order is restored

A summer can be a long time in employment law. In our June 2014 issue, we reported the High Court's ruling in Prophet v Huggett. The opening paragraph of the piece reflects, albeit gently, our bemusement at the decision. Now, the Court of Appeal has restored the traditional approach, holding that, if a covenant is impractical or useless but nevertheless clearly drafted, it should not be re-written by a court. The insertion of new words, in line with the presumed intention of the parties, should only occur where the meaning of the original draft is ambiguous.


'You started it...'

Still on restrictive covenants, what about their enforceability when the employer has flouted the central contractual obligation to pay salary? We are all aware of the basic rule that he or she who breaches the contract loses the right to enforce its other provisions, including those that would apply post-termination. But that has to be applied with caution and with an eye to the particular circumstances. In Sunrise Brokers v Rodgers, the employee's salary was withheld because of his unauthorised absence. That context, and the employer's stated willingness to recommence payments as and when he returned, meant that it had not repudiated or even breached the contract and that, therefore, he remained subject to the restraints he had agreed to.


It may have made no difference, but...

Two recent decisions of the EAT – Dominique v Toll Global Forwarding and LB of Southwark v Charles – have effectively made the same point. Even if a failure to make reasonable adjustments would not have prevented the dismissal of a disabled employee for redundancy, that person may still prosecute a claim under the Equality Act about the failure itself. The reasonable adjustment at issue in each case differed. In Dominique, it was the need to remedy the effect of selection criteria about productivity and accuracy on someone with physical and cognitive impairments following a stroke. In Charles, it was the requirement to find a 'non-interview' way of assessing the suitability for alternative employment of a person who, because of a rare paralysis condition and consequent depression, was unable to attend 'administrative meetings'. But the point is that dismissal is not the disadvantage that the employer should be looking to eradicate or minimise through an adjustment. Rather, it is the simple award of lower (than otherwise) scores which is the detriment and which could at least attract an award for injury to feelings.


Double jeopardy

McMillan v Airedale NHS Trust is not about unfair dismissal law (or, indeed, any other statutory employment protection). The Court of Appeal was considering injunctive relief for an individual seeking to prevent her employer from utilising its contractual disciplinary appeals procedure in a certain way. But the decision – that the employer could not increase sanction (from final warning to dismissal) on appeal – resonates with unfair dismissal principles. Having considered the Acas Code, the judges were clear that such 'ramping up' of penalty was contrary to the basic idea that an appeals procedure is for the benefit and protection of employees. And even the observation of Underhill LJ, that, if it was wanted, the right to increase sanction could and should be expressly provided for, must be treated with caution. That express right for an employer would avoid there being any breach of contract if a dismissal were imposed at appeal stage. But it would not guarantee that the dismissal would be statutorily fair – the legislation's standard requirement that it be 'reasonable in all the circumstances' would still have to be satisfied.


Turning over every stone?

Here's another non-unfair dismissal case that has relevance to the standards required for a fair dismissal. In Hendy v Ministry of Justice, the High Court was being asked to grant an injunction to stop internal disciplinary proceedings continuing because, Hendy said, his employer's investigation was insufficiently thorough. However, Mann J declined to award the remedy, ruling that conducting a disciplinary investigation is not a 'mechanical process' and that, while the credibility of complainants' or witnesses' information should be tested sufficiently 'to enable a reasonable view to be reached', it was not necessary to put every minute detail of 'the accused's' denials or explanations to each and every informant. All good sense and good news, but, of course, with regard to such detail, the devil is in it – an employer must still review material, to filter and extract the key points properly.


Feelings are worth more

In Cadogan Hotel Partners v Ozog, the EAT has decided that the 'Vento bands' for awards for injury to feelings in discrimination cases (see page 84 of Employment law for line managers 2014 – 2015) should be increased by 10%. So, the normal maximum award for injured feelings has risen from £30,000 to £33,000.


Another £30,000 under scrutiny

There's still a lot of internal consideration and public consultation to be done before anything comes of it, but the Office of Tax Simplification has recommended to the Government that the current exemption from income tax for payments connected with the termination of employment be abolished and replaced with one applying to statutory redundancy payments only.


The twilight zone

On-call arrangements come in various forms. And the form can determine whether the time spent on such standby is 'working time' or a 'rest period'.

Several decisions of the ECJ and of the EAT state that on-call hours are working time if the worker must stay in the workplace or 'the place determined by the employer', even if sleeping is permitted during the period in question.

Against that, the Northern Ireland Court of Appeal has found that a worker can be on a rest period when required to be contactable and able to respond promptly but not at a specific location determined by the employer.

Now, the EAT, in Truslove v Scottish Ambulance Service, has plugged the gap in the middle. It has found that on-call time for ambulance paramedics who were required to stay at accommodation of their choice but within a three mile radius of the relevant ambulance station (something that prevented their staying at home) were engaged in working time.


You pays your money, you takes your choice...

The German employment minister has recently commissioned a report on the viability of legislation to restrict employers' contacting staff outside working hours. Citing a clear link between constant availability and stress or other forms of mental illness, she has asserted a need for 'universal and legally binding criteria'. France operates a ban on e-mails after 6.00 pm, although only for a few sectors.

Neither Germany, where there is already a law against contacting employees during holidays and some large companies have already set up restrictions on contact out of hours, nor France is the UK. But, given the broad brush of the EU's social dimension, let's assume that a similar rule, covering both holidays and other times when a person is formally on 'down time' and extending to phone calls, arises for consideration here. There are problems.

Quantitatively, an absent employee might understandably prefer to deal with a proportion of communications in real time, thereby spreading demand rather than facing a more heavily populated inbox on his or her return. Ensuring that such an attitude does not prevail will entail increased focus on broader underlying issues, such as the extent of use of e-mail and time management.

Intervention while away has a qualitative angle as well. An individual will sometimes be inclined or feel compelled to remain involved to preserve the shape or approach of a 'pet project' which, without his or her prompt response, might be taken in an unwelcome new direction that would be time-consuming to reverse. So, would the employee's volition have a role to play in defining the scope of any control?

And related to that is a third obstacle. Any proposal for regulation of this type rather treats an employer and employee as operating in a silo – it takes little account of the requirements or demands of clients or customers, which often rest to some extent on trust in and/or the knowledge or previous contribution of a particular person. First, the client/customer might well e-mail that person directly. Would and could that be covered by a holidays/out of hours ban? Then, even without this complication, colleagues (who would themselves be precluded from receiving communications outside their working times) must sometimes at least look to their absent colleague for initial 'steer' on detailed history or an aspect of the earlier dialogue in order to provide a proper 'substitute' service. A holiday/lengthy absence list can only meet so many eventualities.

So, the symptom (stress, burn out for a noticeable and increasing minority) might be clear and the frequent cause (information/communication overload) generally accepted. But is a regulatory cure without more exempted groups than covered ones feasible in the modern, 'full on' business age? Is regulation even appropriate or proportionate anyway, given that the very media that would be its targets are those that have allowed people more flexibility on working time and location in the first place? In any event, the challenge that Germany and France face to find a practical, manageable solution is significant. And to think that, thirty years ago, we kidded ourselves that the 'new technology' was ushering in a time of increased leisure...


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.