UK Employment Law case updates - June 2017

Latest UK Employment Law case updates - June 2017

1. Whistleblower protected despite employer not believing employee motives
2. Overseas employees may bring UK employment tribunal claims
3. Ambulance workers entitled to holiday pay for shift overruns
4. Equal pay for parents after compulsory maternity leave
5. Employee held to restrictions despite objecting to TUPE transfer

Beatt v Croydon Health Services NHS Trust case [2017] EWCA Civ 401

The Court of Appeal has confirmed an employee may be unfairly dismissed for blowing the whistle, even when an employer does not believe the disclosure relied upon is a "protected disclosure".

A qualifying disclosure for the purposes of the whistleblowing legislation arises when a worker makes a disclosure of information relating to one of six types of relevant failures, and the worker must reasonably believe that the information tends to show one of the relevant failures and is in the public interest.

Mr Beatt worked as a cardiologist at Croydon University Hospital NHS Trust ("the Trust") for seven years. Following a patient's death during an operation, he raised concerns regarding the suspension of a particular nurse on the day of the operation and, more generally, the absence of sufficient specialist nurses at the Trust.

The Trust argued that the allegations were "entirely without merit and … gratuitous in nature" and motivated by Mr Beatt's desire that the suspended nurse be reinstated. Mr Beatt was subsequently dismissed for gross misconduct; he then brought a claim of automatic unfair dismissal on the grounds of making a protected disclosure.

The ET upheld the claim, finding that there was a link between the protected disclosures Mr Beatt relied upon and some of the allegations of misconduct made against him by the Trust.

The Trust appealed arguing that at the time of dismissal it did not believe Mr Beatt had made a protected disclosure and so he could not have been dismissed for that reason.

Finding in favour of Mr Beatt, the Court of Appeal required two key questions to be answered when considering claims of this kind: (i) whether the disclosure is the principal reason for dismissal, and (ii) if so, whether the disclosure amounted to a "protected disclosure" within the meaning of the Employment Rights Act 1996 ("Act").

The Court concluded that Mr Beatt's disclosure did amount to a protected disclosure under the Act and that his dismissal was principally motivated by that disclosure. Accordingly, he succeeded; the Trust's view of the disclosures was irrelevant.

This case serves as a reminder of the factors which must be present (and those which are not relevant) for an employee to succeed in a whistleblowing claim. It highlights that allegations of wrongdoing raised by employees should always be taken seriously and demonstrates the pitfalls of failing to take legal advice at the appropriate time.

Green v SIG Trading Ltd UKEAT/0282/16/DA

The Employment Appeal Tribunal has held that an objective test must be applied when determining whether an employee has a strong connection to the UK for the purposes of the employment tribunal's territorial jurisdiction to consider a claim.

Mr Green was employed in 2013 as the Managing Director of SIG Trading Limited, a UK registered company, for its business in Saudi Arabia. Mr Green had lived in the Middle East for over 15 years and had no home in the UK. He continued to live in Lebanon, commuting to work in Saudi Arabia for two to four days each week, only visiting the UK occasionally for work.

However, Mr Green reported to a manager based in the UK, where other support staff members for the project were also located. He was also paid in UK pounds sterling and his employment contract was a standard UK contract governed by English law which included references to British employment law protections.

As a result of financial pressures, SIG decided to close its business in Saudi Arabia resulting in Mr Green being made redundant. He subsequently brought a claim for unfair dismissal.

The Employment Tribunal rejected Mr Green's claims on the basis it did not have territorial jurisdiction, believing that he had stronger connections to Saudi Arabia than the UK. In so doing it found that the Saudi Arabia operation was financially independent of SIG's UK financial budget because losses in Saudi Arabia were not absorbed into the company's UK finances. Mr Green appealed.

The EAT allowed the appeal in part, ruling that the ET wrongly disregarded the fact that the parties had agreed that the contract would be governed by English law and that Mr Green was employed by a UK company: the focus should not have been on his role, but on who was employing him. It emphasised that the test for assessing Mr Green's connection to the UK was an objective one.

However, the EAT allowed SIG's argument that the UK-based management decision-making for operations in Saudi Arabia was a pragmatic and logistical arrangement and it did not add further weight to Mr Green's status. The case was remitted to the ET to decide whether UK statutory protections applied.

Although this case is yet to be reconsidered in the light of the EAT judgment, employers should take care when assessing which type of contract is suitable for an overseas employee: providing standard contracts governed by English law in such situations may create difficulties in the face of potential employment claims.

Flowers and others v East of England Ambulance Trust 3400310/2015

In the latest of a run of cases on employees' pay during annual leave, the Employment Tribunal has ruled that ambulance workers’ compulsory overtime in relation to shift overruns should be included in the calculation of their holiday pay.

Ambulance staff at East of England Ambulance Trust ("the Trust") brought a claim for unlawful deductions from wages against their employer, stating that the following should have been included in their paid annual leave:

• non-guaranteed overtime that is required when a shift overruns (i.e. if their shift ends during an emergency); and
• voluntary overtime, where staff can choose to work additional shifts.

The ET held that the Trust must include non-guaranteed overtime for "shift overruns" in the worker's holiday pay, as it was an essential requirement of their contractual role that they remain on that shift in the event of an emergency call. However, as there was no obligation for the workers to accept and carry out voluntary overtime work, the second element claimed by the ambulance staff was found not to be part of pay for the purposes of calculating the workers' annual leave.

Despite the clear delineations made between the elements of pay in this judgment, employers should maintain caution when including and calculating holiday pay ensuring a fair, objective and realistic approach is taken.

M Ali v Capita Customer Management Limited 1800990/2016

The Employment Tribunal has held that a male employee whose employer refused to pay him full pay during his additional paternity leave was directly discriminated against on the grounds of his sex.

Mr Ali took two weeks' paid paternity leave on the birth of his daughter. During this fortnight, his wife was diagnosed with postnatal depression, and she was medically advised to return to work to assist her recovery. As a result, Mr Ali sought to benefit from shared parental rights and made a request to his employer, Capita, to take the remainder of his wife's maternity leave to look after the child whilst she went back to work.

Capita's policy stated that, for any additional leave, Mr Ali was only entitled to statutory shared parental pay. Mr Ali brought a claim of direct sex discrimination on the basis that he should have been entitled to the same rights of enhanced pay as a female colleague following the birth of her child.

The ET upheld his claim. It ruled that after the first two weeks of the child's life, during which the mother must recover physically from giving birth, the treatment of a man and woman are comparable, as either could assume the role of primary carer. Mr Ali was denied the benefit of 12 weeks' full pay afforded to a woman following 2 weeks' compulsory maternity leave, and he was deterred from taking the leave as a result.

The judgment confirmed the importance of allowing parents a practical choice on childcare based on their circumstances, without the hindering assumption that the mother is always best placed to care for a child and should therefore be the only parent entitled to receive full pay.

There has been little previous case law on enhanced shared parental pay and this ruling is not binding as a first-instance decision. However, employers should maintain clear business reasons for their parental leave policies, and ensure employees are supported equally in the weeks after their child is born.

ICAP Management Services Ltd v (1) Dean Berry (2) BGC Services (Holdings) LLP [2017] EWHC 1321 (QB)

The High Court held that an employee cannot avoid his contractual obligations to his employer by alleging a TUPE transfer (when his employer was acquired) and then objecting to that transfer.

Mr Berry was employed by ICAP Management Services Limited ("ICAP"), which provides brokerage services. His contract of employment included a 12-month notice period.

On 22 July 2016, Mr Berry gave notice to ICAP to terminate his employment. Two days later, the second defendant, BGC Services (Holdings) LLP ("BGC"), a competitor of ICAP, issued a public announcement that Mr Berry would be joining the company as an executive managing director. Mr Berry was placed on garden leave by ICAP a day later.

On 30 December 2016, Tullett Prebon Plc ("Tullett"), another brokerage house, acquired the entire issued share capital in ICAP's parent company. Presumably seeking early release from his garden leave, Mr Berry claimed the Tullet transaction triggered a TUPE transfer, to which he objected, as it would mean that his employment with ICAP terminated by operation of law.

ICAP applied for an interim injunction to enforce Mr Berry’s garden leave.

The High Court held that a transfer under TUPE had not taken place, because the ICAP and Tullett businesses remained distinct, in competition, and functioned in the same way as before the merger took place. ICAP was therefore entitled to an injunction against Mr Berry, who will remain subject to his contract of employment with ICAP until the expiration of the 12 months' notice period.

In addition to serving as a reminder that TUPE transfers are not typically triggered in the context of share acquisitions, the case highlights one of many strategies that employees may use in a bid to avoid lawful restraints on competition. It also demonstrates that Courts will be alive to such strategies and will undertake a full enquiry into the factual matrix in order to ensure that parties are held to the bargains into which they enter.