Employment Law Bulletin - Issue 139 - 8 January 2013

Tuesday 8 January 2013

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Employment news

Response to Consultation now published

The Government has now published its response to its consultation on employee owner contracts. Less than 2% of respondents to the consultation indicated an intention to use the scheme, with the remainder expressing greater or lesser degrees of concern. The Government responds by proposing to change the name of the scheme from "employee owner" to "employee shareholder". It remains the Government's intention that this new status will come into effect from April 2013. Click here to read the Government response to consulation.

ACAS Conciliation, protected conversations, etc

The Enterprise and Regulatory Reform Bill, which is likely to introduce compulsory ACAS conciliation, protected conversations, and limit the scope of whistleblowing claims, is at the Committee stage in the House of Lords with further amendments to be discussed there on 9 January 2013.

Discrimination against army reservists

A government consultation on army reservists remains open until 18 January 2013. The Government proposes introducing a voluntary "kitemark" scheme to reward civilian employers who make positive provision for reservist employees. In its document, the Government has raised the possibility of legislation outlawing discriminatory treatment of reservists by their employers. Click here to read the Ministry of Defence's consultation paper.

Changes to tribunal compensation

Tribunal compensation limits will increase on 1 February 2013. The maximum week's pay, used to calculate statutory redundancy payments and basic unfair dismissal awards, will increase from £430 to £450. The limit on the amount of the compensatory award for unfair dismissal shall increase from £72,300 to £74,200. Click here to read The Employments Rights (Increase of Limits) Order 2012

Employment Case Law

Supreme Court

Date of termination

Société Generale v Geys [2012] UKSC 63
As a matter of common law, the date of the termination of an employee's contract is when the employee elects to accept a breach as repudiatory, rather than the date when the breach took place. So, the Supreme Court has re-affirmed, with Lord Sumption dissenting. The Claimant was a highly-paid worker who was potentially eligible for significant bonus payments which depended on when his employment was terminated. It was a term of his contract that he could be summarily dismissed by payment of notice pay. However, his employer originally terminated his contract by letter only (without paying notice pay), and then by making a payment only (but without explaining how it has been calculated), and only set out the basis of the payment in the following year. The House of Lords held that the letter of termination was ineffective to end the contract, as was the notice payment, and that the employee's contract was only validly terminated by sending him a payslip. Click here to read the full judgment.

Court of Appeal

Employee status

Stringfellow Restaurants Ltd v Quashie [2012] EWCA Civ 1735
Ordinary unfair dismissal claims can only be brought by employees. For the worker to be an employee she must be engaged under a contract of service or apprenticeship (s 230 ERA 1996). As "service" indicates, the key consideration will usually be whether the work was controlled at work by the workers' managers or whether she was in business on her own account (Yewens v Noakes (1880) 6 QBD 530; US v Silk 331 US 704 (1946)). The Court of Appeal has considered the employment status case of an erotic dancer, who was paid in vouchers ("heavenly money") by customers rather than by the business, and therefore risked going without much pay or even any at all. The dancer was, on the other hand, subject to he business's hours of opening and disciplinary rules. Elias LJ held that the dancer's risk of going without any payment at all outweighed the indications of control, and that the Employment Tribunal had not erred in finding that the dancer was not an employee. Click here to read the full judgment.

Employment Appeal Tribunal

Reasonable investigation

Stuart v London City Airport [2012] EAT 0273/12
Whether a dismissal on grounds of misconduct is fair or not will depend on whether the Respondent had a genuine belief as to the Claimant's misconduct based on reasonable grounds and following a reasonable investigation (British Home Stores v Burchell [1980] ICR 303, EAT); but does this test require an employer to investigate an employee's exculpatory defence? Often it will, the EAT has held, finding (in effect) that a reasonable employer would normally investigate a defence where the allegation was serious. The case concerned an airport worker who was purchasing presents when invited outside the store boundary by another colleague and then accused of intending to steal the goods. The Respondent relied on a statement of a store assistant who claimed to have seen the worker concealing the items in his jacket, but did not interview the assistant about her allegations and refused to investigate CCTV material or interview other staff members, including the colleague who had invited the worker outside the store. Click here to read the full judgment.

Reasonable adjustment

Rider v Leeds City Council [2012] EAT 0243/11
Where a provision, criterion or practice (PCP) of an employer's puts a disabled worker at a substantial disadvantage in relation to a person who is not disabled, the employer is required to take reasonable steps to avoid the disadvantage (section 20 Equality Act 2010). Where a worker is required by her employer to work under a PCP, but this PCP is never actually implemented, is the employer liable for discrimination? The EAT has considered the case of a Nursery Officer who was seconded from her original workplace, and then required to return to it despite two consultants finding it was likely to cause her infections. The Nursery Worker never actually returned to the post, and was ultimately dismissed on grounds of capability. Although she never returned there, the Employment Appeal Tribunal held that this could not determine the outcome of the case. Instead, the requirement to return to work there amounted to a PCP. The employer had offered no adjustments and its conduct had been unreasonable. Click here to read the full judgment.

Notices & coming events

Employment Law Bar Association Meeting
Thursday 17th January 2013 at 6.15pm

The next meeting of the Employment Law Bar Association will be on "The Right to Resist: Privilege for Employment Lawyers?". This meeting will take place at 6.15pm on 17th January in Room 2.04 on the second floor of the New Academic Building of the LSE in Lincoln's Inn Fields.

Struck Out: Why Employment Tribunals Fail Workers
Thursday 21 February 2013 at 6.00pm

Garden Court's David Renton will address a Manchester meeting of the Industrial Law Society on "Struck Out: Why Employment Tribunals Fail Workers", on 21 February at 6pm, in Lecture Theatre G35, Manchester Metropolitan University Business School, All Saints Campus.



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