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After a poor summer, perhaps we should spare a thought for naturists and golfers!? If the newspapers are to be believed it would appear that the Government is considering further expansion of discrimination legislation to protect them. The Sunday Times reported recently that the Government’s Equalities Office (EO) has displayed on its website a submission by the British Naturism group which complains that “naturists encounter prejudice in employment”.
British Naturism told the Sunday Times “the presumption of many in society that a person without clothes is always up to no good is archaic and discriminatory”. The EO says the report will “form an essential part” of the National Equality Panel report to be published later this year.
This has led to a few (some might say facetious) remarks that the next group of people to seek protection will be golfers. Apparently, fed up with being ridiculed about garish clothing, overcomplicated and expensive equipment, and having trivial but enthusiastically enforced rules at their clubs, golfers are now demanding protection too.
Anyway, let’s take a look at some employment law:-
Extra Holiday if Employees fall sick
The big news this month is the decision of the European Court of Justice that workers who are sick whilst on pre-arranged holiday leave are entitled to request extra leave in order to make up their minimum leave entitlement under the Working Time Directive.
The rationale is that all workers should be entitled to a minimum of four weeks’ rest and relaxation a year, which they are not getting if they are sitting sick at home or in a hospital bed. Critics say this decision leaves the system open to abuse, with the potential for employees to (falsely) claim to be ill on holiday to obtain further paid holiday. Whilst true, there is no reason why employees should be any less truthful about this than about being ill on any ordinary day when they might prefer not to come into work.
Further, the impact of this decision is less onerous than suggested in many newspapers. First, the employee has to actually ask for the extra holiday, and take it in the same leave year (unless it’s not possible to take it in the same year, in which case it can be carried over). Second, by changing the status of his or her absence from paid holiday to sick absence, the employee loses the right to holiday pay for the days they have been ill and will just be entitled to SSP (which is nothing for the first three days, and then £79.15 per week), unless their contract entitles them to greater levels of sick pay.
Employers’ flexibility when choosing redundancy “pool”
In the case of Lomond Motors Ltd v Clark, an employment tribunal found that Mr Clark had been unfairly dismissed on grounds that the pool from which he was selected for redundancy dismissal was inappropriate. The Employment Appeal Tribunal reversed this, stating that the dismissal was fair – a decision that confirms employers have a wide degree of flexibility when deciding on the size and nature of a redundancy pool.
Lomond Motors Ltd had four garages. The two garages in the west of the area (the West garages) were covered by one accountant and the two in the east (the East garages) were covered by two accountants including Mr Clark. The Company decided that it could work with only one accountant in the East and therefore pooled for redundancy Mr Clark with the other “East” accountant. Mr Clark, who had been recently transferred to the East from the West, believed that the accountant for the West garages should have been included in the pool. The Employment tribunal agreed with him. However, the Employment Appeal Tribunal has overturned the decision, saying that in this type of situation there is a “band of reasonable responses” open to an employer which gives it a wide measure of flexibility. In this case, the East garages were a “separate work centre” and it was only the East that was subject to a change. There was no real reason to suggest that the pool chosen by the employer was unreasonable.
Self-employment v employment
Regular readers of this bulletin will be aware of the plethora of case law over the past year dealing with the hardy-perennial issue of whether workers are considered employed or self-employed. Overall, it’s probably fair to say that HM Revenue and Customs have had their arguments eroded somewhat, with case law tending to favour those claiming to be self-employed. However, it is possible that the tide could be turning:-
HMRC view on self-employment in the construction industry
HMRC has now published a consultation document called "False Self-employment in Construction", which proposes that workers within the construction industry should be deemed to be in receipt of employment income (which would be subject to tax and NIC) deductions unless at least one of the following three criteria applies:
- that a person provides the plant and equipment required to complete a job (not just tools of the trade);
- that a person provides all materials required to complete a job; or
- that a person provides other workers to carry out operations under the contract.
The individual's employment status for employment law purposes would not be directly affected by these proposals, although workers will presumably be less likely to accept self-employed status if tax incentives are removed. Any comments need to be lodged with HM Treasury by 12th October 2009.
Contract supply agreement or contract of employment?
In Larner v Launahurst Ltd, Mr Larner worked as a window installer from 1995. In 2004 he signed a “contract supply agreement” which specified that it was not a contract of employment and that it constituted the “entire agreement” between the parties. He paid his own tax and he held public liability insurance throughout the time he worked for the Company. He provided his own equipment.
In 2008 the Company dispensed with his services and Mr Larner issued an unfair dismissal claim, claiming that he had been an employee. The Employment Appeal Tribunal (EAT) upheld an employment tribunal finding that he was in fact an employee and that the “entire agreement” clause was a sham. The Tribunal took all the evidence into account and decided that factors pointing to Mr Larner being self employed were outweighed by factors indicating employment, including:- he was paid on a regular basis; he had no direct control over particular jobs that he undertook; to outside observers he appeared to all intents and purposes to be an employee; the “contract supply agreement” bore no resemblance to how the parties actually dealt with each other.
While the agreement stated that there was no mutuality of obligation to offer or accept work, the EAT believed that the parties never realistically intended that this would be the case.
If misconduct is admitted the employer is not required to investigate further
In the case of Kelly v Manor Oak Mr Kelly was a service technician and MOT tester for Manor Oak garage. He was found to have passed a car through an MOT when he should have failed it. He said he must have caused the damage that made the car fail the test when carrying out prior repairs. He was dismissed for negligence after accepting responsibility for the mistake at the disciplinary hearing. The Employment Tribunal found the dismissal to be unfair on the basis that Manor Oak’s belief in Mr Kelly’s guilt was not on reasonable grounds (despite the admissions by Mr Kelly). It found that Manor Oak took into account a witnesses’ evidence that the damage was deliberate and proceeded on this premise.
The Employment Appeal Tribunal (EAT) allowed Manor Oak’s appeal. In relation to Mr Kelly’s admission, and the impact this had on the appropriate level of investigation, they said “Manor Oak discharged the onus of showing that they genuinely believed that he had committed the misconduct, that they had reasonable grounds to hold that belief and had carried out a reasonable investigation before reaching that conclusion. Once the admissions were made...they plainly did not require to take their investigations further. They were, in particular, not required to investigate how serious the default was”.
The EAT held that the Tribunal should have considered whether, in such circumstances, dismissal was within the range of reasonable responses – instead it had substituted its own view of the matter.
ACAS report reveals increase in unfair dismissal claims
While Working Time cases have reduced in the Employment Tribunal (from 29,000 to 18,000), there has been a steep rise in unfair dismissal claims, which in the last year have increased by 22% to 55,000. The last year also saw a significant increase in unlawful deductions from wages claims. Unsurprisingly there has been a huge increase (75%) in requests to ACAS for redundancy advice which confirms that when there is mention of the possibility of redundancies, employees seek advice to ensure that they are being carried out fairly.
And Finally…
As autumn looms, it is apparent that the much heralded “barbeque summer” failed to materialise. Those of us who took part in the equally hyped “staycation” can justifiably feel hard done by. It sometimes helps to hear that things could have been worse, so we bring you news of treatment meted out to passengers of a Continental Airlines flight this summer. The plane, bound for Twin Cities, was diverted to Rochester (USA) due to a storm. The airline crew had reached their maximum number of working hours (something akin to the Working Time Regulations) so they left the plane as soon as it landed. While a replacement flight crew was arranged and flown in, the ground crew refused to allow the passengers to leave the plane. In fact they were locked in. For a whole night! At 6 a.m. they were allowed into the terminal and given a free beverage. This was after spending the night in what one passenger described as a “sardine can” with “screaming babies” and, after a while, “no functioning restroom”...
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