UK: tribunal rulings extend scope of protected philosophical beliefs

Employers should keep a watchful eye on the steady stream of cases challenging the boundaries of the protection for philosophical and religious beliefs.  Employee activism and use of social media mean the potential for a clash of opposing beliefs in the workplace will only increase; a considered, sensitive response that does not take sides will be key to avoiding claims.  Employers may also wish to consider or review staff policies on expressing views on social media and in the workplace.

  • Recent rulings in Forstater and Mackereth have established that gender-critical beliefs can be protected beliefs, including a limited right to express those beliefs (whereas objectionable manifestations such as intentional misgendering will not be protected) – see here.  A first instance tribunal in Bailey v Stonewall Equality, Garden Court Chambers and others has now ruled that the protection extends beyond the core gender-critical belief (that women are defined by biological sex rather than gender identity) to also cover a belief that gender theory as promoted by Stonewall is severely detrimental to women (including that it denies them female-only spaces) and to lesbians (in that it labels them as bigoted for being same-sex attracted).  Expressing hostility to Stonewall campaigning on the basis of gender self-identity did not seek to destroy the rights of others in a way that would not be worthy of respect in a democratic society.  Garden Court Chambers’ knee-jerk reaction to complaints about the claimant’s gender-critical comments, tweeting that it would launch an investigation and subsequently concluding that she had likely breached Bar Standards, was held to be unlawful belief discrimination.
  • In contrast, in McClung v Doosan a first instance tribunal rejected a claim that supporting Rangers football club could be a protected philosophical belief.  A desire that a particular team do well did not concern “a weighty and substantial aspect of human life”, the variety of fan behaviour meant that there was insufficient cogency, cohesion and importance to the belief, and it did not invoke the required degree of respect in a democratic society.  (The claimant did not seek to bring a religious discrimination claim.)
  • In Scottish Federation of Housing Associations v Jones  the claimant’s employment contract included a political neutrality clause and she was dismissed after having requested (and been denied) permission to stand as a candidate for a political party in the general election. She claimed unfair dismissal on the ground of her political opinions or affiliations (which does not require the usual two years’ service) and belief discrimination.  The EAT held that the dismissal allegedly for refusing to comply with a political neutrality requirement was not ‘related to’ her political opinions or affiliation to a political party;  the unfair dismissal legislation was intended to cover dismissals because of the content of a person’s political opinions or the identity of the party they support, and not because of a lack of neutrality.  However, the claimant’s belief that ‘those with the relevant skills, ability and passion should participate in the democratic process’ if democracy is to thrive was a protected philosophical belief for the purposes of a discrimination claim.
  • In Wierowska v HC-One Oval, the tribunal ruled at a preliminary hearing that a care-home worker’s opposition to the Covid vaccine was sufficiently closely linked to her longstanding Catholic beliefs to be a protected religious belief, notwithstanding the Pope’s statement that having a vaccine was morally acceptable.  There is no requirement for a religious belief to be part of the mainstream or orthodox view taken by a particular religion in order to be protected.  Her concerns were linked to the longstanding Catholic position on abortion and the medical use of stem cells or foetal material and were part and parcel of a fundamental view about the sanctity of human life. She also believed that the vaccine might alter her blood cells which would be contrary to her religious belief that the body is the temple of the Spirit and should remain unadulterated.  Her ‘stubbornness’ in rejecting medical evidence on this only went to support the argument that she held a religious belief which was not open to debate.

 

Anna Henderson
Anna Henderson
Professional Support Consultant, London

UK: employers at risk of paying more than statutory cap on unfair dismissal compensatory awards in some cases

Employers face paying more than the statutory cap for unfair dismissal compensation in some cases, following a ruling of the Scottish EAT in Dafiaghor-Olomu v Community Integrated Care.  

The statutory cap on unfair dismissal compensatory awards (the lower of 52 weeks’ pay and, currently, £93,878) applies to the overall assessment of compensation after ‘taking into account’ any payment made by the employer to the employee in respect of the subject matter of the claim.  The Scottish EAT has ruled that, where a compensatory award ordered by the tribunal was paid by the employer but the employee then appealed the remedy, and at the second remedies hearing the tribunal calculated compensation at a higher amount well above the cap, the original sum paid should be deducted before applying the statutory cap.  The employer argued that the cap should be applied first and the amount already paid then set off;  the EAT had sympathy for the employer’s position but felt constrained by the statutory wording to reject this argument.  As a result, the employer ended up paying the statutory cap plus the amount of the initial award.

Absent this decision being overturned or legislative reform, employers can therefore be penalised if they pay a first award promptly, only for it to be successfully appealed.  Where the claimant could potentially be awarded loss significantly in excess of the statutory cap, employers may wish to consider not paying the original award within the required 14 days and seeking a stay of any enforcement proceedings pending appeal.  However, interest would continue to be payable (currently at 8% pa) from the day after the original decision.

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London

UK: tribunal orders re-engagement overseas of unfairly dismissed trader in light of negative regulatory reference

The recent tribunal ruling in Jones v JP Morgan Securities plc illustrates how a financial services employer’s position on providing a regulatory reference could influence the likelihood and nature of a tribunal order to re-engage an employee who has been unfairly dismissed.  It is also flags the possibility of an order being made to procure re-engagement at an associated employer overseas.

The tribunal held that the claimant had been unfairly dismissed for alleged gross misconduct: it found that the employer did not have a genuine belief in misconduct having occurred and that the procedure adopted was also unfair.  This finding did not change the employer’s position that it would provide a regulatory reference stating that it did not consider the claimant to be a fit and proper person.  The claimant sought a reinstatement or re-engagement order (see box below).

Reinstatement was found to be impracticable as the relevant team had reduced in size and there was no longer a role available.  The claimant therefore sought re-engagement in an available comparable role at an associated employer in Hong Kong, arguing that he was unable to get a regulated financial services job elsewhere in the UK because of the employer’s negative regulatory reference.

In deciding whether to make such an order a tribunal must consider the wishes of the claimant, whether it is reasonably practicable for the employer to comply with the order, and whether the claimant contributed to the dismissal. In this case the tribunal rejected the employer’s contention that the claimant did not actually want to be re-engaged and was seeking it only as a tactic to circumvent the compensatory caps.  Its conclusion that the claimant’s request was genuine was supported by findings that his entire career had been structured around working for the employer’s group, that he bore the employer no ill-will, and that his stop-gap work had been chosen to enable him to leave on short notice.  The tribunal found that the employer could easily procure the Hong Kong role in the associated company and had not presented any evidence that certification requirements would be a problem there. It concluded that, if re-engagement was not awarded, the claimant would never work in a regulated role in the financial services sector again and therefore the order sought was the only way that the unfair dismissal could be “made right”.  An order was made requiring re-engagement within 3 months and a day, by 10 March 2022, along with payment of £1.5 million in compensation for lost earnings.

Together with Fotheringhame v Barclays Services Ltd in 2019 covered in our blog post here, this case highlights the risk for financial services employers of claimants obtaining reinstatement or re-engagement orders and/or substantial levels of compensation for unfair dismissal, notwithstanding – or because of – regulatory concerns.  It may be appropriate for an employer to consider carefully whether facts established at a tribunal hearing could and should justify revisiting their assessment of the individual.

The facts also flag the need for an individual to be able to appeal a firm’s determination that the individual lacks fitness and propriety, a mechanism that is not currently available from regulators, given the impact that reference will have on their future career prospects.

Reinstatement / re-engagement orders

Orders for reinstatement or re-engagement after an unfair dismissal finding are very rare, not least as claimants rarely wish to return to their former employer in these circumstances.  Claimants are more likely to seek such an order where they face significant difficulty finding other employment, or where the individual is a high earner whose unfair dismissal compensation would be reduced by the statutory limits – both of which may be more common in the financial services sector.

Where a reinstatement or re-engagement order is made, a tribunal will also require payment of the original remuneration package from dismissal until the date of ordered reinstatement or re-engagement.

An employer cannot be forced to comply with a reinstatement or re-engagement order but, if they refuse, the tribunal will substitute a basic and compensatory award and will also make an additional award of between 26 and 52 weeks’ pay (unless compliance with the order would have been impracticable).  Although these awards will be subject to the statutory caps (on weekly pay and compensatory award), the caps are lifted to the extent necessary to ensure that the amount of the compensatory award plus additional award are at least as much as the lost remuneration that would have been payable had the reinstatement/re-engagement order been complied with. Where there has been a considerable delay between dismissal of a high earner and the tribunal hearing and consequent date reinstatement/re-engagement is ordered, the financial compensation could greatly exceed the usual cap on unfair dismissal compensation.

 

Anna Henderson
Anna Henderson
Professional Support Consultant, London
+44 20 7466 2819
Christine Young
Christine Young
Partner, London
+44 20 7466 2845
Nick Wright
Nick Wright
Senior Associate, London
+44 20 7466 7524

UK: EAT suggests employers contemplating dismissal may need to seek employee’s response to lesser disciplinary sanction

In some cases it may be prudent for an employer contemplating dismissal to discuss with the employee whether they would abide by a final warning.  This will of course depend on the nature and seriousness of the original misconduct and the surrounding circumstances, but it is worth building a check into the disciplinary process at least to consider whether this might be appropriate.  If a final warning might be sufficient, then the employee’s views about this should be sought and factored into the decision, rather than relying on assumptions about whether they would heed a warning.

In London Borough of Hammersmith and Fulham v Keable, a long-serving employee was dismissed following his expression of personal, anti-Zionist views at a political rally outside of working hours, video footage of which was uploaded onto social media by a third party without his consent with comments identifying him as a council employee.  The council dismissed him on the basis that his comments were inappropriate, likely to be considered offensive, and likely to bring the employer into disrepute.

The Employment Appeal Tribunal upheld the tribunal’s finding that dismissal was outside the band of reasonable responses, given that the employee had expressed his political views in a lawful way, outside the workplace, with no discernible link to his employer, and that he was not responsible for the social media content.

The EAT also agreed with the tribunal’s view that there had been significant procedural unfairness. As the employee was dismissed based on the decision-maker’s conclusion as to how his comments would be interpreted by the average person, he should have been given an opportunity to respond to this.  He should also have been given an opportunity to comment on whether a warning would have been appropriate and heeded by him; his response should then have been taken into account in determining whether to impose a lesser sanction. It was unfair for the decision-maker simply to assume that the employee would repeat his comments based on his insistence that he had a (qualified) right to offend.

The tribunal’s reinstatement order was upheld as there was clear evidence that the council had not lost trust and confidence in the claimant.

Anna Henderson
Anna Henderson
Professional Support Consultant, London
+44 20 7466 2819

UK: failure to offer appeal against redundancy/SOSR dismissals is not inevitably unfair

The statutory Acas Code of Practice on Disciplinary and Grievance Procedures requires employers to offer employees a right of appeal for misconduct or poor performance dismissals;  a failure to do so will render the dismissal unfair in addition to potentially increasing the compensation awarded.   The fact that the Code expressly does not apply to redundancy, and has been found by case law not to apply to dismissals for some other substantial reason (“SOSR”), has lead to uncertainty as to whether employers need to offer an appeal for those types of dismissals to be fair.  Two recent cases have made clear that a lack of appeal will not always render such dismissals unfair, but this is likely to be the exception rather than the rule and it will depend on the individual facts of the case.

In Moore v Phoenix Product Development the employee, an executive director and founder of the employer company, had caused an irreparable breakdown in trust and confidence, for which he was unrepentant even after the dismissal decision.  On the facts, there was no potential for retraining or finding others who could work with him.  Given there was no scope for rebuilding trust and confidence, an appeal would have been futile and therefore the EAT concluded that it was within the band of reasonable responses to dismiss and not offer an appeal.  The EAT confirmed that an appeal will normally be part of a fair procedure for a SOSR dismissal, but not invariably so.  The case is similar to that of Gallacher last year (see here), where the lack of appeal was not unfair, given the relationship between two senior managers had irretrievably broken down and the claimant had made clear she had no interest in trying to resolve matters.  It will clearly be helpful for employers to have evidence showing that the employee has no interest in repairing the relationship.  If there is persuasive evidence that a further appeal meeting would be truly pointless, a failure to offer an appeal may not render the dismissal unfair.

In relation to redundancy dismissals, the Court of Appeal in Gwynedd Council v Barratt has confirmed that the absence of an opportunity to appeal does not of itself make a redundancy dismissal unfair.  Absence of an appeal is one of many factors to be considered in determining fairness, including whether the individuals were given a proper opportunity to be consulted or to make a grievance about the process.  The Court stated that “if the original selection for redundancy was in accordance with a fair procedure, the absence of an appeal is not fatal to the employer’s defence. … it would be wrong to find a dismissal unfair only because of the failure to provide the employee with an appeal hearing”.  However, on the facts of the case, the denial of the employees’ statutory and contractual rights to appeal together with a lack of consultation over the redundancy process rendered the dismissals unfair.

 

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819

UK: Court of Session rules dismissal of teacher suspected of possessing indecent images is fair

The case of L v K makes clear that, where there is insufficient evidence to conclude that an employee is guilty of criminal conduct, an employer may still be able to rely on “some other substantial reason” to fairly dismiss.  However, it will be important to be clear as to the proposed reason for dismissal, both at the start of the disciplinary procedure (to ensure the employee is aware and all relevant evidence is considered) and at the Tribunal.

The Court of Session (Inner House) has overturned the EAT’s ruling that the dismissal of a teacher was unfair where he was charged, but not prosecuted, for possessing indecent images of children on his home computer.  The Court considered that the Employment Tribunal was entitled to conclude that dismissal was “for some other substantial reason” and within the band of reasonable responses, given the employer’s statutory responsibility to protect the children in its care.

In the EAT’s view, the Employment Tribunal had been wrong to conclude that the reason for dismissal fell within the “for some other substantial reason” category and was fair.  The EAT considered that the reason fell within misconduct (which was not made out as the employer did not have a reasonable belief that the employee was guilty) and that, if it had been for “some other substantial reason”, this was in the form of concerns about reputational damage which had not been clearly put to the employee and did not justify dismissal.

Conversely, the Court of Session agreed with the Employment Tribunal’s categorisation of the dismissal as “for some other substantial reason”.   In the Court’s view, the employer’s concern that it had a statutory responsibility to protect children was an important part of the reason for dismissal; it had decided that it could no longer place the necessary trust and confidence in the teacher, due to the real possibility that he was an offender. The Tribunal was entitled to conclude that the employer’s decision to dismiss for this reason did fall within the band of reasonable responses.

The Court noted that the employer had an additional concern about reputational risk but found that there was nothing to support that this was the main reason for the dismissal.  But in any event, dismissal would not have been rendered procedurally unfair simply because the letter inviting the teacher to the disciplinary hearing failed to mention reputational risk in terms.  The teacher understood the nature of the complaint and the reason for dismissal was based on elements identified in the letter and highlighted in the report given to him in advance; reputational risk was mentioned in the investigatory report and discussed at the hearing.  Given that the issue of reputational risk was only ancillary to the main reason, the Court did not consider in detail the EAT’s concerns that there was insufficient evidence of such a risk to justify dismissal, although the Court commented that it thought the risk “self-evident”.

The case makes clear that, where there is insufficient evidence to conclude that an employee is guilty of criminal conduct, an employer may be able to rely on “some other substantial reason” to fairly dismiss.  However, in the majority of cases where the statutory duty to protect children or vulnerable adults does not arise and the employer is relying solely on reputational risk, the nature of any real reputational risk is likely to be more closely examined. Relevant factors may include the identity of the employer (for example if it is a high profile public authority), the seniority of the employee’s role, and whether that role would provide opportunities for similar criminal offences – factors which all tipped the balance in favour of dismissal for reputational risk being fair in the case of Leach v OFCOM.  The nature and seriousness of the allegations, the reasons why and terms on which charges have been dropped and the likelihood of press interest (factors identified by the EAT in L v K) will presumably also remain relevant.

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819

 

UK Covid-19: “work from home” guidance continues to 19 July; recent tribunal cases highlight issues for employers planning return to the workplace

Yesterday evening saw the postponement of ‘Freedom Day’ and the continuation of the ‘work from home if possible’ guidance until 19 July.  The news is disappointing for all and economically challenging for many, particularly given that it seems there will not be any delay to the requirement for employers to contribute 10% to furlough pay from 1 July.  The end date for virtual right to work checks (see here) has been postponed to 31 August 2021.  On the upside, the delay does give a little extra time to those employers still needing to prepare for a fuller return to the workplace.  Recent tribunal cases have highlighted the need for a sharp focus on the adequacy of health and safety measures, for procedures to ensure employee concerns are handled appropriately and for extra caution when dismissing in this context.

Employees have unfair dismissal protection from day one of their employment if the reason or principal reason for dismissal is for carrying out certain health and safety activities, raising health and safety concerns in certain ways, or where the employee reasonably believes there are circumstances of serious and imminent danger to health and safety and they leave or refuse to return to the workplace or take appropriate steps to protect themselves or others.  There are similar protections against detriment, and from 31 May 2021 these have been extended to workers as well as employees (following a successful judicial review case summarised here).

Tribunal rulings on the fairness of dismissal in given situations have started to trickle through and, although fact-specific and not binding on other tribunals, are instructive as to the likely approach.  The cases so far have concerned situations during the first phase of the pandemic, where virus levels were high and vaccines unavailable;  in most of these, tribunals have readily accepted that employees have held a reasonable belief in being at serious and imminent danger, particularly where the employer has failed to follow the then current government guidance and take reasonable health and safety measures (and the employee has not acted in such a way as to belie the claimed belief).  Developments over the course of the pandemic could mean a more critical approach is taken on this issue where the facts concern later periods, for example if virus levels were lower at the relevant time or an individual had increased immunity due to vaccination or prior infection, although of course the increased transmissibility and current dominance of the Delta variant changes the picture once again.  If an employee does raise concerns about returning to the workplace, it will be important for an employer to engage with them and explain what measures have been put in place, what steps the employee can take themselves to reduce risks at work, and consider any additional reasonable steps suggested.

The reported cases so far include the following:

  • In Gibson v Lothian Leisure, an employee was dismissed after raising concerns about returning to work from furlough in May 2020 given the lack of PPE and other workplace COVID-secure measures and the fact that he lived with his clinically vulnerable father. The tribunal accepted that he was automatically unfairly dismissed because of taking steps to protect his father in what he reasonably believed to be circumstances of serious and imminent danger, namely the growing prevalence of COVID-19 and the potential significant harm to the employee’s father if he contracted the virus.
  • This can be contrasted with the case of Rodgers v Leeds Laser Cutting, where an employee told his manager that he would not return to work until after lockdown because he feared he would infect his clinically vulnerable children with COVID-19. The tribunal found that the employee did not have a reasonable belief in serious and imminent workplace danger on the facts. The employer had implemented the precautions recommended by government advice at the relevant time and the employee had not raised any particular concerns about the workplace measures nor taken any steps to avert danger before absenting himself.  The employee had also breached self-isolation guidance himself, to drive a friend to hospital, on the day after leaving work, thereby undermining his claim to hold the required belief.  The employee’s dismissal for refusing to return to work was not automatically unfair.
  • In Accattatis v Fortuna Group (London) Ltd the employment tribunal did not consider that it was an appropriate step for an employee to insist on being placed on furlough as a means of protecting himself from the risks associated with commuting by bus and working at the office in Spring 2020. The employer, who sold and distributed PPE, justifiably concluded that the employee’s role could not be done from home and that he was not eligible for furlough given its business was busy, but instead it offered him holiday or unpaid leave if he wished to stay at home. The employee declined and requested furlough again, refusing to return.  The tribunal noted that the evolving nature of the crisis and lack of knowledge about the virus in the early stages made it difficult to assess, but in this case it was “prepared to accept” that the employee did have a reasonable belief in serious and imminent danger (notwithstanding that the employee appears not to have raised any concerns about lack of workplace safety measures). However, the employee’s demands to be furloughed or work from home were not appropriate steps to protect himself from danger in the circumstances.  In any event, the reason for dismissal was to prevent the employee achieving two years’ service when he was perceived to be a difficult and challenging individual, and not his reluctance to come into work.

Employers may also face challenges ensuring some staff follow mandated health and safety measures.  The key points for employers are to ensure instructions are reasonable and clearly communicated, and that any process for dealing with transgressors is applied fairly and consistently;  if so, ultimately dismissal may be a fair sanction.  In Kubilius v Kent Foods the employment tribunal ruled that an employer had fairly dismissed an employee who refused to wear a face mask as required by a client when the employee was visiting the client’s site.  The employee had refused to comply with a clear instruction and as a result was banned from the client’s site.  Dismissal was within the range of reasonable responses given the importance of maintaining good relationships with clients, the employee’s continued insistence that he had done nothing wrong (which caused concern as to his future conduct) and the practical difficulties arising from his being banned from the client’s site (given the majority of work was for that client).  Of course in some cases an employee may have a legitimate reason for not wearing a face covering, so it is important to check whether this is the case and, if so, consider whether adjustments to the role or an alternative role could be offered.

Although not in a COVID-19 context, there have also been two recent Employment Appeal Tribunal decisions which will be relevant when considering how to handle COVID-related health and safety concerns as employees return:

  • In Flatman v Essex County Council, an employer’s cumulative and persistent failure to provide health and safety training to an employee required to perform lifting duties, despite repeated requests, was a fundamental breach of the implied contractual duty to provide a safe work environment. A lack of training on one occasion or for a short time may not be sufficient to amount to a fundamental breach, but the breach can become fundamental where it is repeated or persists over an extended period (in this case around eight months), given the increased and continuing risk and/or actual harm caused (the claimant here developed and reported back problems a few months in).

Once committed, a fundamental breach cannot be cured by the employer, although the employee may be found to have affirmed the contract and waived the breach (for example, by waiting too long to resign).  The employee in this case had not affirmed the contract and so was entitled to resign and claim constructive dismissal.  This was notwithstanding the employer’s promise of training and changed duties, given after the point at which the conduct had amounted to a fundamental breach.  The EAT commented that, in considering whether there has been a fundamental breach of the duty provide a safe work environment, the employer’s statements of intention or attitude are relevant factors (if made before the point at which a fundamental breach has occurred), but they will usually be less significant than they might be were the claim one of breach of trust and confidence.

The case highlights the importance of employers taking steps promptly to address health and safety concerns and ensuring that promised changes or training are not delayed, to avoid the situation becoming a fundamental breach of health and safety duties.  Ignoring concerns for an extended time may amount to a fundamental breach and, once that point is reached, it will be too late to “cure” the breach however genuine the employer’s concern and intentions at that stage.  Of course, aside from the legal position, it is still worth an employer making genuine attempts to remedy past failings as this could be sufficient to persuade an employee not to resign.

  • The EAT decision in Sinclair v Trackwork Limited makes clear that an employer cannot fairly dismiss an employee for carrying out health and safety duties on its instructions, simply because the changes are unwelcome to the workforce and cause “upset and friction”.

It is automatically unfair to dismiss where the reason or principal reason is that the employee carried out health and safety activities having been designated to do so.  Mr Sinclair was asked to implement a new safety procedure, but the employer failed to inform his colleagues of this instruction and also failed to convey to Mr Sinclair its desire that the change be implemented gradually.  Mr Sinclair’s attempts to implement the change led to complaints about his “over-zealous” methods.  The employer decided to dismiss, arguing that the dismissal was because of the way in which the health and safety activities were carried out and not the activities themselves and therefore it should not be automatically unfair.  The EAT rejected this argument, noting that carrying out health and safety activities will often be resisted or regarded as unwelcome by colleagues and it would wholly undermine the protection if an employer could rely on the upset caused by legitimate health and safety activities as a reason for dismissal unrelated to the activities themselves. It is likely only to be possible to separate an employee’s conduct from the carrying out of the activities if their conduct is “wholly unreasonable, malicious or irrelevant to the task in hand”.

Given the existence of diverging views on COVID-19 risk and appropriate safety measures, the case highlights the importance of good communication both with managers implementing health and safety measures and with the wider workforce, to ensure changes to workplace practices are put in place with minimal “friction”.  Employers should not jump to the conclusion that dismissal will necessarily be justified simply because upset is caused by an employee’s implementation of safety measures, given this may be unavoidable and the employee may have carried out the activities entirely properly.

Finally, the financial pressures of the pandemic have caused some employers to seek to agree changes to employees’ contracts and, where these are not accepted, to dismiss (and potentially offer to re-employ on the new terms).  Employers may well have a potentially fair reason for such dismissals, but it will be critical to ensure they adopt a fair procedure and consultation and that the process is not rushed unnecessarily.  In Khatun v Winn Solicitors Limited, the employment tribunal held that it was potentially fair to dismiss an employee for refusal to agree a variation to her employment contract giving the employer the right to unilaterally reduce her pay and hours to 80% or place her on furlough, potentially for up to nine months.  She was the only one of around 300 staff not to agree and the tribunal accepted that the firm had “sound, good business reasons” for the variation which amounted to the potentially fair “some other substantial reason” for dismissal.  However, dismissal was unfair in the particular circumstances.  There was no proposal to furlough the employee immediately and the employee had indicated she would consider a variation if it did become necessary to furlough her in the future.  The employer had acted too quickly in dismissing within two days of sending the new terms;  it had failed to consult meaningfully (particularly as it would only have needed to consult with one employee given the rest of the workforce had agreed) and had not reasonably considered solutions other than dismissal.  It would also have been reasonable in the circumstances to offer of a right of appeal, as this could have provided an opportunity for both sides to cool off and reach an agreement.

Following considerable media and MP criticism of recent large-scale “fire and re-hire” practices, in January 2021 the Government asked Acas to investigate.  Their report published on 8 June 2021 revealed a lack of consensus on whether there is a need for reform and noted the risk that reform could result in more businesses failing and jobs lost.  The Government has since stated that it considers the use of fire and rehire to be unacceptable as a negotiation tactic and that it should only be used as a last resort, but that it has no current intention to ban the practice.  Instead it has asked Acas to produce better guidance for employers on good practice, although “nothing is off the table” if the guidance proves ineffective.

Please do get in touch with your usual Herbert Smith Freehills contact if you would like to discuss preparations for a wider re-opening of the workplace.

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819

UK: tribunals should not overrule employer’s genuine and rational belief that re-engagement is impracticable

A tribunal can order re-engagement of an unfairly dismissed employee where the employee seeks this (and reinstatement in the original role is not appropriate). In deciding whether to do so, the tribunal must consider whether the order would be practicable.  The Court of Appeal in Kelly v PGA European Tour confirmed that re-engagement will be impracticable where the employer holds a genuine and rational belief that the employee would not be capable of fulfilling the role or that trust and confidence has been broken. It is the view of the employer at the time that is important, not that of the tribunal afterwards.

The Court noted that it will usually be wrong for a tribunal to hold that re-engagement to a role is practicable if the employee does not meet an essential requirement of that role (such as speaking Mandarin in this case). The fact that the employee might be able to meet the requirement in future (in this case by learning Mandarin and, in the interim, using a translator) does not render the position practicable at the time the order is being considered.

It may also be impracticable to re-engage an employee where the employer has lost trust and confidence in the employee, provided the employer’s view is genuine and founded on a rational basis.  It is not for the tribunal to substitute its own view.  In this case the employer’s belief that trust and confidence had been broken by the employee’s covert recording activities (discovered post-dismissal) was genuine and rational and so was an additional reason why re-engagement was impracticable.

Finally, there is no need for the tribunal to consider vacancies in potentially comparable or suitable employment which had arisen but had been filled prior to the remedies hearing.  Therefore employers do not have to hold off on filling possibly suitable vacancies pending the remedies hearing.

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819

UK: April 2021 changes to statutory benefits, tribunal compensation, minimum wage

From 6 April 2021, the cap on the unfair dismissal compensatory award increases from £88,519 to £89,493 and the cap on weekly pay (used to calculate the unfair dismissal basic award and statutory redundancy pay) increases from £538 to £544. This gives a maximum unfair dismissal award of £105,813. Note that since 29 July 2013 there has been an additional cap on the compensatory award of 12 months’ pay.

The bands for injury to feelings awards have also been increased for claims presented on or after 6 April 2021;  the lowest band starts at £900, the middle band at £9,100, and the highest band starts at £27,400 with a cap of £45,600 (save in exceptional cases).

From 4 April 2021 the weekly rate of statutory sick pay increases to £96.35 per week (from £95.85) and the weekly flat rate of statutory maternity, paternity, adoption and shared parental pay increases to £151.97 per week (from £151.20).

The national minimum wage rates increases from 1 April 2021. Workers of 23 years and older will be entitled to be paid a minimum national living wage of £8.91 per hour (increased from £8.72).  The hourly rate for those aged 21 to 22 increases to £8.36 (from £8.20).

 

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819

UK: EAT rules that connected disciplinary investigations do not need to be ‘sealed off’; dismissal for employee covert surveillance may be unfair

The EAT ruling in Northbay Pelagic Limited v Anderson makes clear that it will not always be fair for an employer to dismiss an employee who has set up covert surveillance at the workplace.  Here, the employee was a director who had reason to suspect that someone had entered his personal office and accessed his computer; he was concerned to protect his confidential information on the computer while he was suspended and so installed a covert camera.   The EAT held that, given the negligible risk that individuals other than those entering the personal office would be captured on camera, dismissal on this ground was not within the band of reasonable responses. The employer should have carried out a balancing exercise between the individual’s right to protect his confidential information and the (limited) impact on the privacy rights of other employees, before dismissing.  Employers could strengthen their hand in this situation by ensuring that relevant policies provide that covert surveillance by an employee is gross misconduct.

The case is more helpful for employers on the issue of connected disciplinary investigations.  The employer had engaged three HR consultants to investigate the connected conduct of the claimant and two other individuals;  in relation to one individual the first consultant would investigate; the second, chair the disciplinary; and the third, hear any appeal.  The individual chairing the claimant’s disciplinary took into account evidence she has obtained while investigating the case against one of the others and the tribunal thought this was a fatal procedural flaw.  The EAT disagreed: if an employer is conducting disciplinary investigations into multiple employees whose cases are related, there is no need for the investigation of the employees to be “sealed off” from one another. It would not have been reasonable to expect the employer to hire separate teams of HR consultants to investigate each set of allegations. It can be in the interests of accuracy and coherence that a statement from one witness can be used in several processes if it is relevant.

Anna Henderson
Anna Henderson
Professional Support Consultant, Employment, London
+44 20 7466 2819