Employment Law Bulletin: April 2015

It’s April. It’s time for some employment law changes.

The most headline-grabbing of these is the new right for qualifying parents to take shared parental leave, which we discussed last month. And there are other family-friendly provisions coming into force now too, including surrogate parents’ eligibility for leave, and wider rights for adoptive and other parents.

From 6 April, people who adopt a child don’t need to have 26 weeks’ continuous service before being able to take adoption leave. From the same date, parents of any child under the age of 18 have the right to take unpaid parental leave. Previously only those with children aged five and under, or with a disabled child, had this entitlement.

Then there are the annual increases in statutory pay. Maternity, paternity and adoption pay goes up to £139.58 per week. That rate also applies to shared parental leave. Statutory sick pay increases to £88.45 per week.

Finally, a week’s pay for calculating redundancy pay and the unfair dismissal basic award increases to £475, and the maximum compensation award shoots up to £78,335.

Diet-controlled diabetes wasn’t a disability
Metroline Travel v Stoute

What does and doesn’t amount to a disability is hotly debated, as equality law continues to develop. The Metroline case centered around whether a type of diabetes that was controlled by diet satisfied the legal definition of ‘disability’. Was it an impairment which had a substantial and long-term effect on the claimant’s ability to carry out normal day-to-day activities?

Mr Stoute was a bus driver. He had type 2 diabetes, which he controlled mainly by avoiding sugary drinks. After he was dismissed for gross misconduct he brought several claims, including disability discrimination, against his employer. The tribunal found that he was disabled, but dismissed his claims. Nevertheless the issue of whether or not his diabetes was a disability proceeded to the Employment Appeal Tribunal (EAT).

It overturned the tribunal’s decision. Type 2 diabetes isn’t automatically a disability. If it were, it would mean that people with conditions like nut allergies or lactose intolerance would also be considered to be disabled, the EAT said. A condition that was controlled by a small change in diet was not a long-term condition that restricted the claimant’s ability to carry out ordinary day-to-day tasks.

This doesn’t mean that type 2 diabetes will never amount to a disability. In this case, it simply came down to the EAT’s conclusion that abstaining from sugary drinks was not a substantial adverse effect on day-to-day activities caused by the diabetes.

Tribunal provides key to Lock
Lock v British Gas

It’s been a long time coming. The tribunal’s decision on whether or not Mr Lock’s commission payments should form part of his holiday pay is finally here. The answer: yes they should.

Cast your minds back to 2012 when Mr Lock’s claim against British Gas arrived at tribunal. He was a salesman whose holiday pay was calculated by reference to his basic salary and didn’t take account of the variable monthly commission he earned. That meant that he earned less during annual leave than at other times of the year because he wasn’t able to make sales.

The case was referred to the Court of Justice of the European Union (CJEU) which decided that a worker should, as a matter of law, have their commission included in their holiday pay. In February this year Mr Lock was back at the tribunal for a decision on the effect of the CJEU’s decision on his case and on the many others in its wake. The tribunal has held that Mr Lock’s holiday pay should include his commission. New words have been added to the Working Time Regulations to overcome the current incompatibility between EU and domestic law.

There’s now a solid, UK, legal basis for a worker’s right to have commission payments included in their holiday pay in the future. Those workers who want to claim backdated pay will face a two-year limit on the extent of these claims – unless they issue their Claim Form before the cap comes into force on 1 July 2015.

Employers urged to tap into talent pool

The government has published a report that looks at the benefits of employing older people. It raises some interesting points, including the business case for retaining, retraining and recruiting this section of workers. Keeping experience within your organisation, lowering staff turnover and increasing customer satisfaction levels are said to be just a few of the advantages organisations can gain.

The report encourages employers to plan for an ageing workforce. Some of the key suggestions are:

  • Audit the age and skills within your organisation to ensure that you’re making the most of your older workers
  • Train managers in managing older people and age-diverse teams – promote healthy ageing and flexible working
  • Look at retraining to make sure there are opportunities for all
  • Where older people are in physically demanding roles, look at providing training for new roles
  • Monitor age diversity, especially in the recruitment process

It’s worth a read. You’ll find it here.

Deductions and the Minimum Wage
Commissioners for Revenue and Customs v Lorne Stewart

Lorne Stewart required some of its employees to go on courses. If they left the company within two years of the course, the company could deduct the cost from the employees’ pay.

Ms Brade resigned less than two years after completing a course. Lorne Stewart deducted the cost but this took her final salary payment below the National Minimum Wage level. HMRC issued a notice of underpayment, and the issue of whether or not the employer was entitled to make the deduction went to the Employment Appeal Tribunal (EAT).

The EAT found in Lorne Stewart’s favour. In assessing whether the National Minimum Wage has been met, exclude “any deduction in respect of conduct of the worker, or any other event, in respect of which he (whether together with any other workers or not) is contractually liable”.

Ms Brade’s resignation came within “any other event”, the EAT held, and so the deduction of course fees could be disregarded in working out if she had received the National Minimum Wage. The EAT made clear that “any other event” required some conduct (but not necessarily misconduct) on the part of the employee; they had to be in some way responsible for the event. So Ms Brade’s voluntary resignation fitted the bill.

Redundancy forced upon the employee would, on the other hand, not amount to “any other event” and their final salary payment would need to meet the National Minimum Wage.

Be careful what you ask for

As of 10 March there is a new offence that will bite some employers.

Under the Data Protection Act it’s now a crime to ask someone to exercise their subject access rights to reveal data held about them by someone else and to reveal that data to a person. In other words, you could be prosecuted if you ask an employee, a job candidate or a contractor, for example, to request and disclose information about their convictions and cautions.

This doesn’t mean that employers will always be denied access to these sorts of details. But you should use the checks available through the Disclosure and Barring Service rather than forcing someone to make a data subject access request. The latter is seen as an unfair way of an employer getting more information than they’re entitled to. That’s because subject access requests don’t distinguish between spent and unspent convictions and so result in disclosure of all personal information (with a few exceptions).

Redundancy near retirement
Sturmey v The Weymouth and Portland Borough Council

Ms Sturmey worked in the Council’s finance team. She was 54. If she had gone on to be dismissed for redundancy when aged 55 or over, she would have been entitled to take an immediate pension.

But Ms Sturmey was made redundant as part of a reorganisation, just a few days before her 55th birthday. She claimed unlawful age discrimination based on the timing of her dismissal. The tribunal held that she wasn’t dismissed because of her age. Her job was redundant and she had no reasonable prospect of deployment. Age therefore had nothing to do with it.

The Employment Appeal Tribunal (EAT) took a different view and has sent the case for a re-hearing. There was evidence that the Council had in mind the timing of redundancies, Ms Sturmey’s impending birthday, and “potential additional costs”. Also, Ms Sturmey remained in the deployment pool for far less time than her colleagues.

The EAT looked at the case of Woodcock v Cumbria Primary Care Trust which the tribunal had made great reference to in relation to justification. That was a very different case to Ms Sturmey’s, the EAT said, one which involved a huge pension liability. Woodcock does not set out a general principle as to whether omitting or eliding stages in the redundancy process to save pension costs will always achieve a legitimate aim or will always be a proportionate means of doing so.

And finally…..
Car enthusiast gets the boot

Well, what a fracas.

We’re not talking just about the incident that led to the non-renewal of Jeremy Clarkson’s BBC contract, but also about the public outcry the whole situation has generated. What exactly happened in that hotel, we don’t know. And until very recently we didn’t know what the consequences would be for the Top Gear presenter. But what we have known all along is that employers up and down the country face comparable conundrums to those in charge of Clarkson’s fate.

So, what to do with a valuable staff member who has stepped out of line. Sack them? Reinstate them? There’s no completely right answer because, whichever way you look, there’s a downside. You lose their expertise, their appeal, their contribution. Or you’re demonstrating to the rest of your workforce – and others connected with your business – that misconduct isn’t that bad after all (and risk claims from those you dismiss in similar circumstances in the future).

What the Clarkson situation has brought to light is just how difficult it can be for employers to make these types of calls. Employment law demands reasonableness. And employers also need to have a deep awareness of the ripple effect, and of how to handle and communicate decisions. It’s the recipe for staying on the right track.

NICOLA HALL

BILSHAN MENSAH

Sam Inkersole

In 2022, Sam won the Taxation’s Rising Star award at the Taxation Awards in and was named in the Accountancy Age 35 Under 35.

Jon Wedge

While Jon’s client work focuses on the financial services sector, he also oversees the firm’s assurance service, as well as supporting the trainees following in his footsteps.

ELANA DIMMER

Elana joined us in 2017 as an ACA trainee, after graduating from Durham University where she had studied languages. She is now a manager in our assurance team.

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