Damages for distress caused by breach of the Data Protection Act

Decision: The Court of Appeal has awarded an individual the sum of £750 for distress caused by a consumer credit company (CCF Limited) for breach of the Data Protection Act ("DPA"). This is the first time that an individual has been awarded such damages under the DPA.

Impact: Even though this was a case involving a consumer transaction, an employee might use the same arguments against an employer regarding the way that the employee’s personal data is processed. Employers are potentially particularly at risk where an employee makes a subject access request. This case could be used as a means of applying pressure. In this case, the sum of £750 took into account that there was no malicious or fraudulent intent by CCF Ltd, that it was a one-off incident and that it been caused by a technical error. Where a subject access request is made in the context of litigation and the employer refuses to comply, or does so in a limited way, damages could be higher. However, before an individual can recover damages for distress, s/he must first be able to show some kind of loss. Employers should ensure that they take into account the new Information Commissioner’s Subject Access Code of Practice (published in August 2013), on which we will be providing training at our Breakfast Briefing on 17 October 2013. [provide link to invite]

Halliday v Creation Consumer Finance Limited

An employee on parental leave can be made redundant

Decision: In this ECJ case about parental leave, it was held that an employee absent on parental leave could be made redundant, provided that the reason for the dismissal was not the parental leave. To limit the risk of claims, the employer would be assisted, if it could show that selection criteria were identical for all those at risk and there was no obligation to attend an interview. The same principles would apply to an employee on maternity or paternity leave.

Impact: The ECJ made some helpful comments. First, it said that it would be acceptable to use an earlier year’s appraisal for an employee who had not had an appraisal during the current year due to being absent on parental leave. However, the observation that selection criteria should be the same could cause problems as appraisal processes often change from year to year. In that case, it would be preferable to use new criteria to apply to all candidates in the pool. Secondly, the ECJ said that an employee on parental leave would not necessarily be disadvantaged by having scores based on performance in an earlier year, since performance can deteriorate as well as improve. As for the ECJ’s comments regarding interviews, we would recommend inviting, rather than compelling, an employee on maternity leave to attend an interview. If unwilling or unable to attend, the employer could offer to interview the employee by telephone or at a venue closer to the employee’s home. However, employers should not stack the cards too much in the favour of a female employee on maternity leave, as that could lead to a direct discrimination claim from a male employee.

Riežniece v Zemkopïbas ministrija and anor.

Dismissal should not be an automatic response to gross misconduct

Decision: When assessing if a dismissal is fair, an employment tribunal applies a well established test which includes assessing whether the sanction imposed by the employer fell within the range of reasonable responses that a reasonable employer in those circumstances and in that business might have adopted. The Employment Appeal Tribunal has held that it is not the case that dismissal of an employee guilty of gross misconduct will always fall within the range of reasonable responses.

Impact: When an employee is found guilty of gross misconduct, in assessing the appropriate sanction, it is imperative that an employer first considers whether there are any mitigating factors – e.g. long service, clean disciplinary record, the consequences of the dismissal etc. to avoid giving the appearance of an "open and shut case". Employers should also ensure that they take a consistent approach when assessing the appropriate sanction. The sanction of dismissal should not be automatic, although, in the majority of cases, it is likely to be the appropriate outcome.

Brito-Babapulle v Ealing Hospital NHS Trust

Third-party harassment protection repealed

With effect from 1 October 2013, the third party harassment provision in the Equality Act, will be repealed. This part of the Equality Act had the effect that an employer could be held liable for the harassment of an employee by a third party (e.g. a client or supplier) if an act of harassment had occurred on at least two previous occasions and the employer was aware of the harassment but had not taken reasonable steps to prevent it.

Its removal is part of the Government’s policy of reducing the legislative burden for employers and supporting growth and economic recovery. The impact is unlikely, however, to be as significant, as the Government anticipates because a claim can still be brought under the pre-existing harassment provisions in the Equality Act (i.e. where an employer creates a hostile working environment). Claims could also arise in the form of constructive dismissal (although damages would be capped, unlike in a discrimination claim), or potentially under the Protection from Harassment Act. However, it does at least remove the slightly arbitrary element of the "three strikes and you’re out" test.