Employment Law Bulletin – Issue 107 – 9 August 2011

Tuesday 9 August 2011

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Employment news

Pay still flat-lining

Only around one in four UK workers has had a pay rise since January 2011 according to the summer 2011 Employee Outlook produced by the Chartered Institute for Personnel and Development (CIPD). For more details, click here.

Private sector pensions "would puzzle Einstein"

Some 14 million workers in the private sector are not saving for their retirement. The final report of the Workplace Retirement Income Commission states that many are discouraged from saving by fees and small print. For more details, click here.

Right to train: in large companies only

The government has published its response to its consultation on whether or not extend the right to train, as set out in section 63D Employment Rights Act 1996, to companies employing fewer than 250 persons. Despite a bare majority of responses to the consultation saying that the right should be extended to all businesses, the government has determined to preserve the status quo. For more details, click here.

Public Sector duty: due shortly

Employment lawyers are still awaiting the Equality Human Rights Commission's Code of Practice for the Public Sector Equality Duty, which was laid before Parliament in July 2011 and will be subject to consultation this autumn. For more details, click here.

Still awaiting

Also anticipated shortly is the government's response to the consultation Resolving Workplace Disputes which proposed, among other suggestions, the introduction of a hearing fee for Tribunal cases and the extension of the unfair dismissal qualifying period to 2 years. For more details, click here.

Employment Case Law

Supreme Court

Employee status

Autoclenz Limited v Belcher and others [2011] UKSC 41
In a case concerning the meaning of the word "worker" for the purposes of the National Minimum Wage Act 1998 (which is the same test as applies e.g. in the Employment Rights Act 1996), the Supreme Court has considered the position of a car valeter who was engaged on a contract for services ostensibly as a "sub-contractor" (i.e. an independent contractor and not a worker or an employee). The Supreme Court has held that in determining employment status, the Tribunal should apply a test that focuses on the reality of the situation rather than concentrating on the written documentation. Moreover, there is no need to show that the written documentation is an active misrepresentation by either or both parties. For the full judgment, click here.

Jivraj v Hashwani [2011] UKSC 40
The Supreme Court has held that an agreement was not void, or in breach of the Employment Equality (Religion or Belief) Regulations 2003, where it purported to restrict the recruitment of arbitrators to members of the Ismaili community. It was not disputed that if arbitrators were "employed" within the meaning of the Regulations, the requirement would be directly discriminatory and would therefore be unlawful. The Court stated that in general terms the test of employee status is whether the person concerned performs services for and under the direction of another person in return for which he or she receives remuneration. The Court went on to hold that the dominant purpose of appointing an arbitrator is the impartial resolution of the dispute between the parties in accordance with the terms of the agreement and, although the contract between the parties and the arbitrators would be a contract for the provision of personal services, they were not personal services under the direction of the parties. Accordingly the Regulations were not engaged. For the full judgment, click here.

Court of Appeal

Trade union discrimination

Gayle v Sandwell & West Birmingham Hospitals NHS Trust [2011] EWCA Civ 924
In a case concerning the imposition of a final written warning in disciplinary proceedings, the Court of Appeal determined that the Tribunal had been correct to find that the underlying issue was that the worker had failed to comply with a management request to discuss her union duties. Accordingly, the Court saw no reason to interfere with the Tribunal's finding that the reason for the treatment was the Claimant's failure rather than the Claimant's trade union activities. For the full judgment, click here.

Equal pay

St Helens & Knowsley Hospitals NHS Trust v Brownbill & Ors [2011] EWCA Civ 903
The Court of Appeal has reminded parties that in cases brought under the Equal Pay Act 1970, the focus of the law is on equality of terms, not upon total pay received. In a case where female employees had a higher basic pay than their male comparators but received a lower uplift to their salary for night, weekend and anti-social hours, the Court held the terms concerned were less favourable to the Claimants than terms of a similar kind in the contracts of their male comparators. For the full judgment, click here.

Employment Appeal Tribunal

Employee status

Stack v Ajar -Tec Ltd [2011] EAT 0527/10
Where a claim had been struck out at a Pre-Hearing Review on the grounds that the claimant was not in a work relationship with the Respondent, the EAT had held that a contract of service or for services can in principle exist even if the parties have not agreed the amount of remuneration. The Appeal Tribunal accepted submissions that it will be very unusual to find a concluded contract of service or for services where the parties have not agreed the amount of any part of the remuneration. But there will be cases, where a contract is entered into but the parties understand that payment will be deferred for some time and leave the amount of the remuneration unresolved in the meantime. Accordingly, the appeal succeeded. For the full judgment, click here.

Sick pay

NHS Leeds v Larner [2011] EAT 0088/11
Under the Working Time Regulations 1998, the entitlement to paid annual leave of a worker absent for the whole of a pay year through sickness does not depend on the worker submitting a request for that annual leave before the pay year ends. So, the EAT has held, in a case where a worker was signed off from work for an entire year and accordingly did not request annual leave during the year concerned. The court went on to say that the position might well be different in the case of a fit employee who failed to make any request for leave during the whole of a pay year. Such a worker, unlike the Claimant in this case, would have had the opportunity to exercise the right to leave. For the full judgment, click here.

Indirect discrimination

Chatwal v Wandsworth [2011] EAT 0487/10
In any claim of indirect discrimination it is for the claimant to establish that he is not the sole person who would be disadvantaged by the provision, criteria or practice in question. In a case concerning religion or belief, in consequence of the use of the word "persons" in, paragraph (1)(b)(i) of the Employment Equality (Religion or Belief) Regulations 2003, the Claimant must demonstrate that there are others who hold the same belief and would similarly be disadvantaged (Eweida v British Airways [2010] EWCA Civ 80, reported in Garden Court Employment Bulletin 77). In a case concerning an employee who was required by his employer to join a fridge-cleaning rota which brought him into contact with meat, and who was a member of the Guru Nanak Nishkam Sewak Jatha branch of the Sikh community, which disapproves of the handling of meat, the EAT held that the Tribunal had failed to engage with the Claimant's evidence that he was a member of a group, and accordingly the case had to be remitted to the Tribunal for a further hearing. For the full judgment, click here.

Notices & coming events

The Industrial Law Society

The Industrial Law Society's annual Oxford conference will be held from Friday 16 through to Sunday 18 September 2011 at St Catherine's College, Oxford. For more details, click here.



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