Employment Update, UK – February 2009

19 February 2009

Elizabeth Lang

Legislation

The repeal of the statutory dismissal and grievance procedures will have a significant effect on the handling of workplace disputes.

Background

Statutory dismissal and grievance procedures were introduced in 2004, under the Employment Act 2002. The current procedures are considered to be too rigid, and unsuitable for some disputes. Recent government consultation resulted in a decision to attempt to increase procedural flexibility by dispensing with the statutory codes and introducing an updated ACAS Code of Practice.

New legislation

The statutory procedures will be repealed under the Employment Act 2008, which is due to come into force on 6 April 2009. Thereafter an employee will no longer have to raise a grievance before commencing a Tribunal claim. Automatic unfair dismissal awards and an uplift in damages of up to 50% will no longer be available where an employer has not followed the current statutory procedure. However, the potential increase in an award where the employer has failed to provide a statement of employment particulars as required by Section 1 ERA remains in force.

Transitional provisions will mean that the statutory procedures will continue to apply to events which occurred before 6 April 2009. For the statutory disciplinary or dismissal procedure, the ‘trigger’ event will usually be the step 1 letter. The statutory grievance procedure will continue to apply where the event to which the grievance relates occurred before 6 April 2009.

Claims brought on or after 6 April 2009 will be subject to the ACAS revised Code of Practice. The revised Code has been approved by the Department for Business, Enterprise and Regulatory Reform (BERR) and will be considered for approval by Parliament soon.
Although the Code is not legally binding, adherence to it may be taken into account by a Tribunal and they will have discretion to adjust awards by up to 25% where an employer unreasonably fails to follow the Code.

Employers should note that the Code will not apply to the renewal of fixed-term contracts, or to redundancy dismissals.

Effect on employers

The new legislation will substantially simplify matters for both employers and employees, as the focus will be on the substantive and the procedural issues relating to grievances and dismissals.

Internal disciplinary and grievance policies may require revision in light of the provisions of the new ACAS Code.

However, employers should be aware that the transitional provisions will apply to some disputes for some time to come.

 

Increase in Statutory Limits

New legislation

The Employment Rights (Increase of Limits) Order 2008 will increase compensation limits for individuals bringing a claim in the Employment Tribunal from February 2009. 

The maximum unfair dismissal compensation sum will increase from £63,000 to £66,200, and the weekly rate for the purpose of statutory redundancy payments and the basic award given in unfair dismissal cases will rise from £330 to £350.

The maximum amount that can be awarded for statutory redundancy payments will increase from £9,900 to £10,500.

In October 2008, the National Minimum Wage rates increased from £5.52 to £5.73 for workers aged 22 and over, from £4.60 to £4.77 for workers aged 18 – 21 (and those aged 22 and over doing accredited training in the first six months of employment), and from £3.40 to £3.53 for workers aged 16 and 17.

Effect on employers

This will mean that if cases for unfair dismissal and redundancy payments go all the way to a trial in the Employment Tribunal and are successful, employers will be required to pay a higher level of compensation to the employee, which will have a negative impact on the employer commercially.  It may also act as a deterrent for some employers who may be considering dismissing someone unfairly.

 

Changes in the right to request flexible working

Background

The Employment Act 2002 introduced a statutory right for employees to request flexible working. Flexible working can include changes to the number of hours worked, work patterns or work location. The right applies only to employees who have worked for the employer for 26 weeks and who have a parental responsibility for a child under the age of 6 years old.

The request must follow a statutory procedure and can only be turned down for specified business reasons. If the request is accepted, a permanent change to the employee’s terms and conditions of employment usually follows, with no right to revert to the original contract unless otherwise agreed with the employer.

New legislation

As from April 2009, the right to request flexible working will be extended to parents of children up to the age of 16.

Effect on employers

The new regime increases the number of employees who are eligible to apply for a change in their working arrangements. Employers should be prepared for a significant rise in requests and ensure that appropriate systems are in place in order to respond to requests effectively.

 

Case law

Refusal to let an employee openly wear a cross was not religious discrimination

Background

The EAT has upheld the tribunal decision in the case of Eweida v British Airways, and confirmed some useful points of principle in relation to unlawful discrimination on religious grounds.

Facts

BA had a uniform policy which meant that a religious item could only be worn visibly outside the uniform if wearing the item was a mandatory scriptural requirement – examples were given of the hijab, the turban, and the skull cap worn by some Muslims, Sikhs, and Jews respectively.
 
The claimant argued that her cross fell into this category. The EAT held that it did not.  There was no direct discrimination as the policy applied universally.
 
For indirect religious discrimination to be established, there must be evidence of 'group disadvantage'. It was not enough for the claimant to say that she felt disadvantaged or even that another employee might feel similarly disadvantaged. There must be evidence that a sufficient number of persons of the same religion or belief would suffer the disadvantage and that was not so in this case.

Effect on employers

Employers can take comfort from the fact that although 'religion or belief' is very broadly defined in the relevant regulations, the BA case confirms that it is 'group discrimination' that is being outlawed. It is not enough for a claimant, as in this case, to say that she personally suffered a disadvantage.

On dress codes generally, the EAT was content that BA's uniform policy fulfilled a legitimate aim – brand uniformity which provided a consistent, professional and reassuring image. However, the tribunal warned that, in a case where group discrimination could be proved, a 'blanket' ban on wearing jewellery (which might or might not have religious significance) over uniform would probably be seen as disproportionate. BA has since changed its uniform policy to allow staff to display a 'faith or charity symbol' on their uniform. 

Eweida v British Airways Plc UKEAT/0123/08

 

Holiday during notice period

Background

The EAT has confirmed that an employer was entitled to require an employee, who was working out his notice period, to take any accrued holiday during that period.

Facts

In this case, the employee’s contract stated ‘If the individual gives or receives statutory notice and is not required to perform physical work during that period of notice, the employee shall be regarded as being on holiday during the period of notice’.

The employee argued that the Working Time Regulations 1998 (WTR) require an employer to give a worker a specified period of notice before requiring him or her to take leave on particular days.  However, the employer’s contention was that Reg.15(5) of the WTR allows this rule to be varied by a ‘relevant agreement’, which can include the terms of the employment contract, and this was upheld.

Effect on employers

The general rule under Reg.15(5) of the WTR is that the employer may require a worker to take holiday on certain days only if he gives the worker twice as many days advance notice as the number of days holiday to which the notice relates.  However, as this case confirms, it may be useful for employers to review their employment contract standard terms to see if they could be amended to allow more flexibility, particularly where an employee with accrued holiday entitlement is working out his or her notice period, which may be cost effective.

Industrial & Commercial Maintenance v Britta UKEAT/ 0125/08

 

London Borough of Islington v Ladele

Background

The Employment Equality (Religion or Belief) Regulations 2003 prohibit direct discrimination, indirect discrimination and discrimination by way of victimisation or harassment in the workplace by reason of any religion, religious belief, or philosophical belief.  The Employment Equality (Sexual Orientation) Regulations 2003 prohibit direct discrimination, indirect discrimination and discrimination by way of victimisation or harassment in the workplace by reason of sexual orientation.

Facts

Ms Ladele is a Christian who believes that same-sex marriages are “contrary to God’s law”.  She has been a Registrar of Births, Deaths and Marriages for the London Borough of Islington since 2002.  In 2005, Islington designated all of its Registrars as “civil partnership arrangement Registrars”.

Ms Ladele informed Islington that she was opposing participating in civil partnerships on account of her religious beliefs.  Islington proposed that Ms Ladele would not be asked to officiate civil partnership ceremonies but would be required to perform all other duties relating to civil partnerships, and that Ms Ladele’s refusal to comply would conflict with Islington’s equality and diversity policy.  She avoided carrying out any civil partnership duties by swapping cover with other members of staff, which caused tension in the workplace and led to a series of complaints by fellow employees.

No formal disciplinary action was initiated until May 2007. At the conclusion of the process, Ms Ladele was found guilty of gross misconduct.  Islington repeated its initial offer of allowing her to not conduct the ceremonies but to carry out other work in relation to civil partnerships.  She was informed that a consequence of her not accepting this offer would be that her employment would be terminated.

Ms Ladele issued proceedings at the employment tribunal claiming she had suffered direct discrimination, indirect discrimination and harassment on the grounds of her religion or belief.  The tribunal found in her favour.

Islington appealed to the EAT.  They found that as all employees had been treated the same, there could be no direct discrimination.  They stressed the difference between Ms Ladele’s conduct and her belief.  The disciplinary action against her was not because she held particular religious views, but because she was not carrying out her duties.  They also noted that had Ms Ladele complied with the alternative option offered to her, she would not have been the subject of any disciplinary procedure.  It was also found that there had been no harassment.

In relation to indirect discrimination, Islington argued that requiring staff to act in a non-discriminatory way was a proportionate means of achieving the legitimate aim of providing effective services relating to civil partnerships and promoting equal opportunities.

Effect on employers

This case has clarified how an employer should handle a situation in the workplace where there is a conflict between religious belief and sexual orientation.  If a belief leads the holder to participate in discriminatory behaviour, it is unlikely that they will be protected by the law.

London Borough of Islington v Ladele UKEAT/0453/08.

 

Teasing in the workplace can be discriminate

Background

The Court of Appeal has considered whether an individual who has been subjected to “homophobic banter” by fellow workers is protected by Regulation 5 of the Employment Equality (Sexual Orientation) Regulations 2003 despite the fact that he is not gay, is not perceived to be gay or assumed to be gay by his tormentors and accepts that his tormentors do not believe him to be gay.

Facts

Mr English (“the employee”) worked for Thomas Sanderson Ltd (“Sanderson”) between 1996 and August 2005. In November 2005, the employee issued a claim in the employment tribunal against Sanderson alleging that he had been teased over a period of time and was the subject of homophobic comments by his colleagues relating to the fact that he had been to boarding school and lived in Brighton. The employee found these offensive and claimed discrimination on the grounds of sexual orientation.

The Employment Tribunal dismissed the employee’s claim ruling that he must be gay in order to be protected by the Regulations and that “to find in the claimant’s favour would be to extend the ambit of the Regulations.”

The employee appealed to the EAT who upheld the ET’s decision but granted him leave to appeal to the Court of Appeal on the basis that the legislation was designed to cover all abuse “on the grounds of sexual orientation” and that it did not matter whether he was gay or perceived to be gay.

On 19 December 2008, the Court of Appeal upheld the appeal adding that there are policy reasons why this type of conduct should be covered by the Regulations.  They explained that sexual orientation “is not an either-or-affair”; some people are heterosexual, some are homosexual, some are bisexual, some are asexual, and some just want to keep their sexual identity to themselves.  It cannot have been Parliament’s intention that an individual must declare their sexuality in order to be covered by the law; the law needs to cover employees who have not made their sexual identity known around the workplace.

Effect on employers

This case, which is binding on Employment Tribunals, will have an impact on employers because, what formerly may have been classed as “teasing” in the workplace, may now be covered by anti-discrimination legislation, for which the level of compensation that can be awarded to a claimant is uncapped.  More than ever employers need to put in place sufficient safeguards to ensure the risks of being liable for discriminatory behaviour are minimised.

Similar definitions of harassment to that protecting gay and lesbian employees are contained in legislation covering race, religion or belief, and age. This means that the above decision opens the door for similar claims to be brought in these areas too.

English v Thomas Sanderson Limited [2008] EWCA Civ 1421

Authors