This e-bulletin includes short summaries of the following recent developments. Please contact us if you would like more information.
- Disciplinary process: implied right to fair process enforceable by injunction
The Supreme Court has ruled that there is an implied contractual right to a fair disciplinary process, a serious breach of which could enable an employee to obtain an injunction preventing the employer from completing that process without starting afresh.
In Chhabra v West London Mental Health NHS Trust this implied right was breached because the conclusions of the person investigating allegations had been amended extensively by an HR adviser. This was also in breach of an express undertaking by the employer not to involve that HR adviser, amounting to a breach of the implied obligation of good faith. The intervention had resulted in alleged misconduct being wrongly categorised as gross misconduct. This was also a breach of the employer's contractual disciplinary policy, but the ruling on implied terms clearly applies even where there is no contractual policy.
The Supreme Court granted an injunction restraining the employer from proceeding with the disciplinary hearing without first carrying out a fresh investigation.
Employers should be live to the risk of an employee seeking an injunction if they fail to follow a fair disciplinary process, particularly where capped unfair dismissal compensation would be inadequate (ie, high earners) or the employee might become unemployable if dismissed (eg, in the education, medicine, or financial services sectors). The process should include ensuring that the conclusions of the person charged with investigating disciplinary allegations are the investigator's own, and not influenced by other parties such as HR or legal.
The Court did recognise that it is legitimate for the investigator to seek advice from HR on questions of procedure, or to ensure that the report is presented clearly and covers all necessary matters. Where there has been input from a third party, it will be helpful to keep a documentary record showing its remit.
- Disability: employers cannot outsource judgement on whether individual disabled
Employers should apply their own minds to the statutory test for deciding whether an employee is disabled and should not simply accept occupational health advice unquestioningly.
An employer is obliged to make reasonable adjustments for a disabled employee if it knows or ought reasonably to know (ie, has constructive knowledge) that the individual is disabled and likely to be placed at a substantial disadvantage because of their disability.
The relevant question was whether, on the facts known to it, the employer had constructive knowledge of the individual's disability, notwithstanding a bald statement from an occupational health adviser that the individual was not disabled within the legislation. The employer was not entitled simply to rely on this report given it contained no supporting reasoning.
It is not sufficient for employers to ask external medical advisers simply whether an employee is disabled within the definition. Employers must judge for themselves whether the criteria for disability are satisfied, so should ask medical advisers specific practical questions tailored to the particular circumstances of the employee's putative disability and in respect of each element of the definition (ie, whether there is a physical or mental impairment, whether that impairment has a substantial and long-term adverse effect, and whether the impairment affects the employee's ability to carry out normal day-to-day duties). The answers should be assessed by the employer alongside its own appreciation of the facts. (Gallop v Newport City Council, CoA)
- Termination: scope of "without prejudice" protection
The EAT has confirmed that there is clearly a "potential dispute" giving rise to "without prejudice" protection where an employer has announced an intention to dismiss the employee for misconduct and then negotiated with the employee about an alternative manner of dismissal. This was so regardless of how amicable the negotiations seemed to be: there is no need for any specific complaint such as unfair dismissal to have been raised.
Previous case law has cast some doubt over when there can be said to be a "potential dispute" on a termination, so this is helpful to employers seeking to protect their negotiations. However, it cuts both ways: in this case it was the employer who wanted to rely on the protected evidence to show that the redundancy structure was the employee's suggestion.
The parties had accepted that earlier conversations, prior to the exchange of documents marked "without prejudice", were admissible and the EAT noted that this was correct. The without prejudice rule can apply in principle even if a "without prejudice" label has not been attached, but "the attachment of the label represents a convenient watershed, which should not be displaced except in the clearest of circumstances on the clearest of evidence". (Portnykh v Nomura International plc, EAT)
- Whistleblowing: sequence of communications protected
The EAT has confirmed that employees seeking to establish whistleblowing protection can rely on multiple communications taken together to establish a 'qualifying disclosure' (even if individually they would not qualify). This is so even where the communications are to different recipients, provided the final recipient is aware of the earlier communications.
A manager's emails highlighting his concerns about employees driving in dangerous weather conditions could amount to a qualifying disclosure about health and safety, despite being expressed in three emails to two different recipients. Although each email wasn't sufficient on its own, the last email referred back to the earlier communications and made clear their content, and therefore the earlier emails could be viewed as "embedded" in the later one.
The position might be different if the recipient of the final email could reasonably have been unaware of the earlier ones. (Norbrook Laboratories Ltd (GB) v Shaw, EAT)
- Collective redundancy obligations: Woolworths case referred to ECJ
The Court of Appeal has decided to refer to the European Court of Justice the case of USDAW v Woolworths on the trigger for collective redundancy consultation obligations for multi-site employers. An expedited hearing will be sought.
The original EAT ruling, that the obligation to inform and consult for collective redundancies applies whenever an employer proposes 20 or more redundancies in aggregate even if this is spread across a number of separate workplaces or business units, is summarised here.
- Agency workers: meaning of "temporary"
Workers supplied by an agency on an open-ended basis, rather than for a fixed term, are not covered by the Agency Workers Regulations 2010 as these apply only to those supplied on "temporary" assignments. (Moran v Ideal Cleaning Services, EAT)
- Discrimination: jurisdiction where British national works overseas
The EAT has ruled for a second time that the principle that UK laws which are derived from EU law (such as discrimination law) must be construed as permitting claims by British nationals in England, where English law is the proper law of the contract, only applies where the employee works in the EU. The EAT adopted the same approach as in the case of Dhunna v Creditsights, due to be heard by the Court of Appeal in May 2014. Employers with British nationals working overseas will want to keep an eye on developments in this area. (Hasan v Shell International Shipping Services (PTE), EAT)
- Flexible work: delay to extension of rights; Acas code and guide
The extension of the right to request flexible working to all employees with six months' employment, and the replacement of the current statutory procedure with a duty to consider requests in a reasonable manner, has been postponed from its original implementation date of April 2014. No new date has been announced as yet. The changes will be introduced by the Children and Families Bill and the period for this to receive Royal Assent has been extended to 21 March 2014.
Acas has published its response to the consultation on the new regime including a final draft Code of Practice for Handling Requests to Work Flexibly in a Reasonable Manner, available here. The final draft remains "principles-based". The original draft's proposal that employers should approach requests from the presumption that they would be granted, in the absence of a business reason for not doing so, has been removed. The draft Code states that it is good practice to allow an appeal and to enable employees to be accompanied by a work colleague.
Acas has also published a good practice guide to supplement the code, available here. Of particular interest to employers will be the section on handling competing requests, at pages 15 to 17. The guidance states that employers are not required to make value judgements about the most deserving request. It does not expressly note that this might be subject to the positive duty to make reasonable adjustments for a disabled employee, though this is referred to earlier in the guidance.
If all requests cannot be accommodated, the guidance suggests that employers discuss with the employees to see if there is room for adjustment or compromise and, if not, that the employer could get the employees' agreement to some form of random selection such as drawing names from a hat; ideally the approach in such cases would be set out in a flexible working policy. The guidance also notes that, if an employer is unable to accommodate a request due to the number of other employees already working flexibly, it would be good practice to consider calling for volunteers working flexibly to change their contracts back, in order to create capacity for granting new requests.
- New legislative proposals: zero hours, minimum wage, statutory benefits
- BIS has published a consultation on zero hours contracts, ending on 13 March 2014. The consultation discusses possible approaches to concerns over exclusivity clauses and transparency, including the option of legislation to ban the use of exclusivity clauses in contracts that offer no guarantee of work. Other suggestions include codes of practice and government guidance; there is no proposal to ban such contracts outright.
- The Government has published draft regulations to increase the maximum financial penalty for employers who flout the national minimum wage from £5,000 to £20,000, expected to come into force in February 2014.
- From 6 April statutory sick pay is to increase to £87.55 per week and the statutory maternity, paternity and adoption pay flat rate will increase to £138.18.
- New publications: new TUPE, informal discrimination questionnaires, breastfeeding
Changes to TUPE came into force on 31 January 2014 and are summarised in our blog here. The Government has issued amended guidance on TUPE to reflect the changes, here. Acas has also published guidance on the changes, available here.
From 6 April 2014 the statutory discrimination questionnaire procedure in the Equality Act 2010 will be abolished and replaced with an informal approach. Although tribunals will no longer be able to draw adverse inferences from a failure to respond to such questionnaires fully, they will still be able to take the employer's response to questions into account more generally, and may also order an employer to provide the information sought during the tribunal proceedings. Acas has published non-binding, good practice guidance available here on how employers should deal with questions regarding discrimination in the workplace under the new regime. The content is similar to the guidance under the previous regime. It recommends that the employer speaks to the individual about ways to resolve the dispute and seeks assistance from Acas before any claim is brought, also pointing out that a failure to respond to questions may prompt a claim in the tribunal that could have been avoided by providing clear answers.
New Acas guide: Accommodating breastfeeding employees in the workplace, available here.