In this month’s edition, we provide an update on developments relating to ‘fire and rehire’ and the use of non-disclosure agreements, potential reforms around fit notes and sick pay, and the UK Labour party’s proposal to make company directors personally liable for non-payment of Employment Tribunal awards.
Case law updates
Unfair dismissal: In a rare case the Employment Appeal Tribunal (EAT) has ruled that dismissal was fair despite the employer not following any dismissal process. The claimant had been at risk of redundancy, but the process was halted following his successful grievance claim about being placed at risk. The grievance also contained allegations that his line manager had undermined and scapegoated him, but these allegations were not upheld. Although the employer subsequently made efforts to rebuild relationships with the claimant and to retain him, the claimant (who was off sick at the time) refused to engage. The employment tribunal (ET) found that he placed unreasonable conditions on his employer with respect to his return to work, became confrontational, and threatened further grievances, tribunal claims and referrals to the employer’s ethics team. A more senior line manager considered that the relationship had broken down so much that it was incapable of repair, and the claimant was dismissed without a warning and with no right of appeal. The EAT found that in all the circumstances, this was not an unfair dismissal, although the EAT acknowledged it was an unusual and rare case. As such prudent employers should continue to follow a dismissal process as this remains an essential part of a fair dismissal, other than in truly exceptional circumstances. (Matthews v. CGI IT UK Ltd)
Unfair dismissal: An ET claim hit the headlines this month, illustrating how the perception of fairness can result in litigation and media attention even when the employer has acted properly. In this case, a long-serving supermarket worker was dismissed for gross misconduct for not paying for ‘bags for life’ with his shopping. Following a full investigation, the employer formed a reasonable belief of the employee’s misconduct, with dismissal deemed an appropriate response, so there was no unfair dismissal. Contrary to the portrayal in the media coverage, the value of the bags was irrelevant – the employee’s dishonesty and theft were at issue. (Doffou v. Sainsbury’s Supermarkets Ltd)
Holiday pay: The EAT has been looking at the approach to be taken in determining whether or not an allowance paid to staff should be included in holiday pay calculations. The EAT concluded that a payment which was intrinsically linked to the performance of the role should be included, but one made genuinely and exclusively to cover costs should not. The EAT made it clear that an allowance was either one or the other, and could not be split so that only a proportion of it be taken into account. The EAT also concluded that there was sufficient similarity between each non-payment of holiday pay that it could be treated as a series of deductions. (De Mello v. British Airways Plc)
Race discrimination – burden of proof: In ET proceedings, if a claimant can demonstrate an inference of discrimination, the burden of proof then flips such that it then falls on the employer to prove that discrimination was not the reason for the treatment. In this case, the claimant – an Algerian Arab-speaking employee working in the concession of an Italian designer brand – alleged both unfair dismissal and race discrimination following her dismissal under her employer’s sickness absence policy. The ET found that there was no inference of discrimination, meaning the burden of proof did not shift to her employer to prove otherwise. She appealed, but while the EAT concluded that there was an inference of race discrimination (for example, the management team were all Italian, Italian employees were arguably treated differently, and there was a suggestion that the investigation into the claimant was started after she’d raised a grievance about her Italian manager), it was satisfied that the ET had fully considered all of the evidence and was entitled to reach the decision it had. Although this decision centres on the legal technicalities, it is a helpful reminder that taking the wrong route to a conclusion does not necessarily mean that conclusion is wrong or perverse. (Atif v. Dolce & Gabbana UK Ltd)
Industrial action: The Supreme Court has ruled that due to a gap in the UK, domestic law does not protect workers from suffering detriment which falls short of dismissal where they have organised or taken part in lawful strike action during working hours. This decision demonstrates that domestic law is incompatible with the right to freedom of association under human rights laws, and so it is possible that we will see legislative changes in the UK to ensure compatibility with the European Convention on Human Rights, which will provide more protection to those lawfully striking. (Secretary of State for Business and Trade v. Mercer)
Multi-claimant litigation: The EAT has been considering the extent to which claimants in multi-party employment tribunal proceedings should be placed in the same position in the litigation – for example, in relation to access to documents – even when they are not represented by the same law firm. The issue arose from a multi-claimant equal pay claim where three sets of claimants were represented by three different law firms, with the litigation in respect of two groups stayed pending the resolution of the third. Lawyers acting in the stayed claims wanted access to documentation in the ongoing claim, and to attend the privately held preliminary hearings, but this was refused by the ET. The EAT agreed: while it noted that there was some inequity, this arose from the claimants’ choice of legal representation and there was no right for everyone to be on an equal footing. Under general case management powers, a tribunal could have allowed for more information sharing, but it was not unreasonable for it not to do so.
Whistleblowing: The EAT has concluded that, in a claim for detriment arising from whistleblowing, the knowledge and motives of the decision maker are the only consideration for the ET; i.e., it is right to disregard any involvement or manipulation by others which may have occurred. This was a surprising outcome because the Supreme Court has previously concluded in whistleblowing dismissal cases that the ET can look behind the knowledge and motives of the person who decided to dismiss when determining whether whistleblowing was the real reason for the action. (Williams v. Lewisham & Greenwich NHS Trust)
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