Employment Law Bulletin: July 2016

Welcome

While EU membership has been dominating the headlines, the world of employment law has continued to turn. And as we all ponder the Brexit implications, here’s our roundup of some other developments.

Acas Code doesn’t apply to ill health
Holmes v Qinetiq

The Acas Code of Practice on Disciplinary and Grievance procedures applies to situations involving misconduct and poor performance. But what about ill health?

The Employment Appeal Tribunal (EAT) has confirmed that in cases of genuine ill health, employers don’t need to follow the Code. This, in turn, means that tribunals aren’t allowed to impose a penalty of up to 25% of any tribunal award because of a failure to follow the Acas Code – since the Code doesn’t apply in the first place.

Mr Holmes was a security guard who had been dismissed for no longer being able to do his job because of his poor health. This was held to be unfair, but the tribunal didn’t award an uplift in compensation for the employer’s failure to comply with the Acas Code. Quite right, said the EAT. This wasn’t a disciplinary case. Mr Holmes wasn’t to blame for his inability to do his job. Culpable conduct is key to the Code applying and, therefore, to the possibility of increased compensation.

Things might not always be this clear-cut. What begins as genuine ill health could become misconduct or culpable poor performance, or vice versa. The real risk here for employers is in not keeping a close eye on the issues as they develop. But this case provides some helpful clarification that in genuine ill health cases where there’s no disciplinary or culpable conduct element (ie something that calls for correction or punishment), the Code won’t apply – although a fair dismissal in those circumstances is obviously preferable to arguing over compensation.

Immigration status and nationality distinguished
Taiwo v Olaigbe, and Onu v Akwiwu

The claimants in these cases were Nigerian nationals who had come to the UK as domestic workers. They were treated badly by their employers and went on to (individually) win various employment law claims.

Out of their cases sprang a question for the Supreme Court: does discrimination on grounds of immigration status amount to discrimination on grounds of nationality – and is it therefore race discrimination? (Nationality being an element of race.)

The reason these people were badly treated was because of their vulnerability as migrant workers, not their nationality, said the Supreme Court. It couldn’t be direct discrimination. Nor could it be indirect discrimination because the employers had not applied a provision, criterion or practice (PCP) to their employees regardless of their immigration status. (In other cases, however, there could well be a PCP that has an indirectly discriminatory effect.)

So, immigration status is not the same thing as nationality. They are linked, but they are not the same. But what was clear from this case was the fact that there is no effective remedy for non-financial loss (for humiliation and distress, for example) available to people treated as Ms Taiwo and Ms Onu were treated. Perhaps tribunals in the future will be able to use the Modern Slavery Act to put this right; the Court hinted at that possibility. We’ll have to wait and see.

Immigration provisions come into force

This month, some of the employment-related parts of the Immigration Act will begin to apply. The main points to be aware of are that from 12 July:
• it will be a criminal offence for a person to work when he or she reasonably believes that their immigration status prevents them from doing so
• employers of illegal workers could be convicted if they had reasonable cause to believe that the employee’s immigration status was a bar to them working. This extends the previous offence of knowingly employing an illegal migrant. A maximum prison sentence of five years could be imposed, and a fine. In some circumstances, the business could be closed down for up to 48 hours.
So check, on an ongoing basis, that your workers have the right to work in the UK, and keep good records. Make sure, too, that those within your business who are involved in recruiting people to work for you know what’s expected of them, and that they understand the severity of getting this wrong.

Prosecuted for taking personal information

The temptation for departing employees to take one or two pieces of useful information with them is sometimes too much.

One ex-employee has found out to his detriment that the Information Commissioner’s Office doesn’t take kindly to this. He was prosecuted for emailing details of 957 clients to his personal email address as he was leaving to start working for a rival company. The documents contained personal information, which included customers’ contact details, purchase history, and commercially sensitive information. A guilty plea followed, and a fine, costs and victim surcharge imposed.

While there may be little an employer can do to prevent these sorts of breaches happening (the offence, by the way, was unlawfully obtaining data), the possibility of a conviction – in addition to civil remedies – could be the deterrent that is needed.

Victory for victims in modern slavery case

A chicken-catching company has become the first British business to be found liable to compensate victims of human trafficking.

Six men from Lithuania had claimed that they were severely exploited. That included being denied sleep and toilet breaks, and living and working in inhumane and degrading conditions. The company has been ordered to compensate for, among other things, unlawfully withholding wages and depriving the men of facilities to wash, rest, eat and drink. The level of that compensation is yet to be decided.

The men were reported to have worked on farms, eggs from which were supplied to businesses that sell to supermarkets. It’s a warning to employers that modern slavery in supply chains is a very real possibility.

If you haven’t yet got to grips with your obligations to eradicate modern slavery – which includes servitude, forced or compulsory labour and human trafficking – from your business and supply chain, do it now. Even if you are not one of the £36m+ turnover businesses that has to publish an annual statement on this, your place in their supply chain could be in jeopardy if you don’t also ensure that your own suppliers, and even your suppliers’ suppliers, aren’t engaged in some form of modern slavery.

Crackdown on legal highs

The fate of so-called legal highs has taken a new turn. The Psychoactive Substances Act is now in force, making it an offence to make, supply, offer to supply, import or export any of these substances where they’re intended for human consumption.

The sorts of things we’re talking about are stimulants, ‘downers’, or hallucinogens. They’re dangerous. And while the use of some may be less easy to spot than others, employers are advised to keep a close eye on workers’ changing behavioural patterns. Acas has some useful information on this that’s well worth reading.

One key point: build psychoactive substances into your drugs and alcohol policy.

And Finally…

Everything’s a bit uncertain at the moment, isn’t it?

For many workers, that’s been a theme for some time. Four and a half million people in England and Wales are in some form of insecure work. That’s according to the Citizens Advice analysis of figures produced by the Office of National Statistics. Variable shift patterns, temporary contracts, and zero hour and agency contracts are at the heart of this.

Citizens Advice has found that when it comes to job searches, a steady, reliable income is as important to people as the amount of take-home pay on offer. A stable job and regular pay is believed to lead to greater productivity and loyalty towards employers.

What will Brexit mean in all this? We don’t know, of course. Time will tell what the effects, good or bad, will be on workers’ feelings of security and on their ability to manage their finances and plan for the future. But until then, the speculation, the analysis – and the uncertainty – will roll on.

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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