Our March 2026 edition provides the latest news on the implementation of the Employment Rights Act 2025, with several provisions having come into force during February, more to follow in April, and several new consultations having been launched on important topics, including collective consultation thresholds, fire and rehire, and flexible working. We also include a round up of recent case law, including cases on the dangers of messaging apps, managing workers who share beliefs on social media, and managing pay differentials after a TUPE transfer.
Case law update
Outsourcing – race discrimination: The Employment Appeal Tribunal (EAT) has been considering an indirect race discrimination claim brought by a group of hospital cleaners who were originally employed by a third party before cleaning was brought back in-house under TUPE. On transferring employment, they retained their terms and conditions of employment, but their rate of pay was less than that of cleaners who had been directly employed by the hospital. The affected cleaners were predominantly from ethnic minorities, whereas the directly employed cleaners were predominantly white. The transferring cleaners lost their claim for race discrimination for the period before the transfer. There was no legal basis for outsourced workers to challenge the contractual terms that the end-user clients agreed with their own employees. However, they succeeded with their post-transfer indirect race discrimination claim. The individuals were put at a disadvantage by the hospital’s policy to apply higher pay only to direct recruits, and relying on TUPE to justify a maintenance of existing pay rates was not sufficient to justify the hospital’s approach. (Alpha Anne and others v. Great Ormond Street Hospital for Children NHS Foundation Trust)
Unfair dismissal – investigations: Acting as a reminder of the importance of considering the context of alleged misconduct, two claimants have won their unfair dismissal claims after being dismissed for inciting violence on a Teams chat. The chat was set up to enable a remote team of customer-facing advisors to stay in touch, discuss work matters, and let off steam. The two claimants were dismissed after they made supportive comments in response to a colleague saying what he wished he could do (which was violent in nature) to a difficult customer he had spoken to. The Employment Tribunal (ET) was critical of the employer’s investigation and process, finding that the dismissal was unfair because the employer relied only on the words said in the Teams chat, without considering the wider context, mitigating factors, and whether the words could reasonably be construed as inciting violence. (Khokhar and Miller v. British Telecommunications Plc)
Unfair dismissal – reason for dismissal: An employee was unfairly dismissed for gross misconduct after allegations of four incidents of fraudulent activity, with the EAT overturning the original decision by the ET that the dismissal was fair. The ET had concluded that although there was no reasonable basis for finding any of the incidents to be fraudulent, the dismissal was fair because one incident was a serious breach of the employer’s policies. In overturning the ET’s decision, the EAT pointed out that the employee had not been dismissed for breach of policy. Once it was established that there was no reasonable basis for the allegations of fraud (i.e., the reason the employer had dismissed the employee), the EAT found that the dismissal had to be unfair. Remedy has yet to be determined in this case, but the fact that the employer could have dismissed for breach of policy is likely to affect how much the claimant receives. (Chand v. EE Ltd)
Discrimination – religion or belief: In this case, an organisation withdrew a conditional job offer to a job applicant after discovering Facebook posts which expressed his Christian views that homosexuality is a sin. On discovering the posts, the organisation (a charity supporting community development) withdrew the offer and held a further interview to discuss the posts, after which the withdrawal of the offer was confirmed on the basis that the applicant’s beliefs conflicted with the organisation’s work with the LGBTQI+ community. In its judgment, the EAT provided valuable guidance for employers dealing with such situations. The EAT indicated that in the case of unfavourable treatment based on a protected philosophical or religious belief, an employer will act unlawfully unless: (i) there is a genuine objection to the manifestation of a protected belief (rather than simply the holding of that belief); (ii) there is something objectionable in that manifestation; and (iii) the unfavourable treatment is proportionate to the objectionable manifestation. This case has been sent back to the ET to properly analyse the issues, although the EAT noted that the mere fact that some service users may find the claimant’s views on homosexuality upsetting and objectionable did not necessarily mean that the unfavourable treatment was justifiable. (Ngole v. Touchstone Leeds)
Settlement of claims: In an important decision for employers, the EAT has confirmed that a claimant was prevented from bringing a claim for whistleblowing detriment based on the terms of a COT3 settlement agreement. The claimant had entered into the COT3 having alleged whistleblowing detriment when she received a negative reference for a job application. The claimant alleged that the negative reference was retaliation for her having raised safeguarding concerns at her school. The COT3 included provision for a new reference and was expressed to be in “full and final settlement of all claims she had or may have in the future against the school, the employer or any of its governors, officers or employees whether arising from employment with the employer, its termination or from events occurring after this agreement has been entered including, but not limited to, claims under ... the Employment Rights Act 1996”. After signing the COT3, and despite the updated reference, the claimant again unsuccessfully applied for a job and sought to bring a new whistleblowing detriment claim based on the previous unfavourable reference, but the EAT agreed with the ET that the settlement terms prevented her from doing so. (Darlington v. London Borough of Islington)
Injunction – abusive communications: The Court of Appeal (CA) has confirmed that the court did have power to injunct a litigant from sending abusive communications to her opponent’s lawyers, although it found it was right not to have done so on the facts of this case. After losing six ET claims, an individual embarked on a campaign of vengeance against her former employer, involving hundreds of abusive, threatening, and explicit messages which continued despite a suspended prison sentence having been imposed for breach of a previous injunction designed to stop her behaviour. When the former employer sought a further injunction, the application was denied. Whilst the court did have power to grant an injunction without there being any live cause of action, the injunction sought was wider than necessary and the misconduct in question had ceased. The CA provided helpful guidance that (i) for an injunction to be granted, the applicant must show a threat or real prospect that the other party will engage in serious misconduct affecting the integrity of the court process; (ii) if the misconduct is not contempt of court, article 10 of the European Convention on Human Rights (freedom of expression) is relevant; and (iii) the scope of the injunction must be no wider than necessary and not interfere with the defendant’s right to continue to conduct litigation. (Titan Wealth Holdings v. Okunola)