Hawley v. Luminar Leisure plc & others; [2006] EWCA Civ 18; IDS Brief 799 p3; CA

Employer’s liability – vicarious liability for tortious acts by door steward employed by another

L owned a nightclub in Southend. A employed W and supplied him to L as a door supervisor at the club. In August 2000 W became involved in a fracas with H, a visitor who had just left L’s club. W punched H in the face, causing him to fall and hit his head on the pavement, resulting in fractures of the skull, jaw and nose and a severe brain injury. H brought proceedings against both A and L, but by the time of the hearing A had been wound up. There was an issue as to whether L could be vicariously liable for W’s actions. The High Court found that it could, as W had become a “temporary deemed employee” for the purposes of fixing L with vicarious liability. It considered the test of the nature and extent of the control which L had over W, in accordance with the case of Mersey Docks & Harbour Board v. Coggins & Griffith (HL). On the evidence, it found that L had sought and exercised detailed control not only over what W was to do, but also over the way in which he was to do it. This control “was such as to make [the supervisors] temporary deemed employees of [L] for the purposes of vicarious liability. It followed that L was vicariously liable for W’s tortious assault. In the CA, L argued that control only transfers from a general employer to a temporary deemed employer in exceptional circumstances, and that A had failed to discharge this heavy burden. L further contended that whilst it controlled the tasks W carried out, it did not control the way in which they were performed. A was engaged as a specialist independent contractor to provide trained and licensed staff, and remained W’s employer for the purposes of vicarious liability throughout. Alternatively, L argued, in the light of the recent judgment in Viasystems [see December and January updates], both it and A should be liable. The CA upheld the CA’s decision. L had exercised sufficient practical control over W to make it the temporary deemed employer. L did not require the services of a specialist company to provide doormen: it was well able to employ and train its own doormen but chose to use A’s services, partly as a device to get around employment laws which might inhibit its ability to control its clubs. Moreover, although A employed, paid and had the power to dismiss the doormen, for all practical purposes L’s management exercised detailed control over the provision of their services and how they were to provide them. L’s manager was in overall charge of security and W took his orders from her. The fact that L did not get involved in the detail of, or training in, methods of restraint did not mean that the High Court erred in finding that L had effective control. L had control of and responsibility for the doormen in fact and by virtue of the contractual provisions between L and A. The CA further held that it would not be appropriate to attribute vicarious liability to both L and A. This case could be distinguished from Viasystems because both companies in that case were obliged to control activities. Whichever of the (slightly different) tests formulated in Viasystems was applied to the present case, it made no difference. Here, A had no immediate or effective control over W’s activities, simply employing & supplying him, and paying his wages for long as L was happy to use his services. In reality, there was effectively and substantially a transfer of control and responsibility from A to L. Thus it was solely L’s duty to prevent W’s tortious act.

Calor Gas v. Bray; 12/09/05 (EAT/633/04); [2006] ICR Part 2 “Recent points” px; EAT

Redundancy – Unfair dismissal – Maternity Leave – Consultation – ET procedure

See below (Redundancy).

Doherty v. British Midland Airways Ltd; [2006] IRLR 90; EAT

Constructive dismissal – whether there was fundamental breach – ET procedure – fair hearing

D was a ticket agent for B at Heathrow. She was elected a staff representative of GMB. An ET found in 2002 that D had been subjected to a detriment in that B had taken action against her for the purpose of deterring her from participating in GMB’s activities at an appropriate time, and penalised her for so doing. She was awarded compensation. In the meantime a further incident occurred, leading to similar proceedings and a similar finding, and a further award of compensation. Following this, B and GMB sought the involvement of ACAS to conciliate their relationship, and there was a series of meetings. D was not involved in these meetings and GMB did not seek her views. She resigned and claimed unfair constructive dismissal on the grounds of trade union activities. The ET found that certain of B’s actions which had led to the previous proceedings amounted to a fundamental breach of contract, however that this fundamental breach had not been the reason for D’s resignation. Instead it held that she had been furious and that her anger had increased as the extent of the conciliation attempts, and her exclusion therefrom, became apparent. When she realised that her ambitions to advance in the union were likely to be thwarted and her future activities unsupported, she resigned. The EAT held that in reaching its finding on unfair dismissal, the ET misdirected itself by making adverse findings as to credit and honesty which were not put to D and had not been advanced by B. If such a point of criticism of a party was to be made by a tribunal when not taken by the other party, it had to be made clearly in advance, so that the object of the criticism had the opportunity to deal with it. The ET had further erred by failing to deal entirely with the matters relied upon by D as establishing a series of cumulative acts entitling her to resign. The EAT did not, however, accept D’s submission that there is, as a matter of contract, a right corresponding in language to the range of an employee’s statutory rights, including the statutory rights protecting trade unionists in the carrying out of their union activities. There was no authority for the proposition that there is an implied contractual term covering precisely the same territory as the statute, and such proposition is misconceived. It would mean that every breach of statutory right would be actionable as a breach of contract. The ET erred in finding that there was a fundamental breach by B. The matter would be remitted for consideration of whether there was cumulatively a breach of contract.

Greenhof v. Barnsley Metropolitan Borough Council; 05/08/05 (EAT/0285 & 0286/05); IDS Brief 795 p11; ICR Part 1 “Recent points” pix; [2006] IRLR 98; EAT

Constructive dismissal – fundamental breach of contract – trust and confidence – failure to make reasonable adjustments – disability discrimination

Reported in the January update. Now also reported at [2006] IRLR 98

Lawson v. Serco Ltd, Botham v. Ministry of Defence, Crofts v. Veta Ltd; Times 27/01/06; IDS Brief 799 p7; Daily Telegraph 02.02.06; HL

Unfair dismissal – jurisdiction – overseas employment

Reported in the January update. Now also reported at IDS Brief 799 p7 & Daily Telegraph 02.02.06.

Piscitelli v. Zilli Fish Ltd; 21/12/05 (EAT/0638/05); IDS Brief 798 p7; EAT

Statutory dispute resolution procedures – extension of time – whether letter before action raises internal appeal – ET procedure

See below (ET procedure)

Willow Oak Developments Ltd (trading as Windsor Recruitment) v. Silverwood & others; [2006] ICR 55; [2006] IRLR 28; IDS Brief 798 p10; EAT

Unfair dismissal – reasons for dismissal – refusal to sign new contract containing restrictive covenant – SOSR – whether reasonableness of covenant relevant

Reported in the January update. Now also reported at IDS Brief 798 p10.

Bowerman v. B & Q plc; 1400375/05, 25/05/05; EOR 149 p36; ET

Disability discrimination – dismissal for unintentional sexual harassment – direct discrimination

ET decision that an employee with Asperger’s syndrome who was dismissed for unintentional sexual harassment was thereby subjected to direct discrimination on grounds of disability and that there was failure to make reasonable adjustments (specifically, the provision of a mentor). As well as loss of earnings, an award of £7,500 for injury to feelings was made, falling within the middle band in Vento on the basis that it was more than an isolated act of discrimination, but was not the most serious of cases. The award was increased by 10% for the employer’s failure to complete the SGP.

Connor v. Hartlepool Borough Council; 2505909/04, 12/04/05; EOR 149 p40; ET

Disability discrimination – reasonable adjustments – physical workstation and working practices

ET decision that H failed to make reasonable adjustments to physical workstations and working practice to accommodate C (a receptionist clerk), who had back problems which she attributed to her working conditions. H failed to seek timely medical advice. No assessment was carried out of particular adjustments that might be required to accommodate C’s disability. Work was done on one workstation [but only to the extent required to comply with health and safety regulations, and not with specific regard to C’s needs] but not the others where C was also required to work. Only later did H say that C could carry out all her duties from the first workstation. As at the last date C attended work, no reasonable adjustments had been implemented.

Department of Work & Pensions v. Hall; [2006] ICR Part 2 “Recent points” pix; EAT

Disability discrimination – mental impairment – psychiatric condition – behaviour – dismissal – adjustments

H suffered from a psychiatric condition but refused to provide information about long-term health conditions or to permit D to contact her doctor. She was dismissed for failure to comply with D’s standards of behaviour by repeatedly refusing to comply with reasonable requests and acting in a rude and threatening manner. The ET upheld her complaint of disability discrimination, finding that D had constructive knowledge of her disability and was unjustified in treating her less favourably and failing to address the possibility of reasonable adjustments. However, as H had decided not to take medication for her disability, any reasonable adjustment would have made no difference. D appealed. The EAT dismissed the appeal: the ET made adequate findings of fact to justify its conclusion that D was fixed with constructive knowledge of the condition. The ET did not misdirect itself in its approach to reasonable adjustments (D contended that the question was whether there could be a failure to make reasonable adjustments where the adjustment would not work in any event): the ET correctly considered that the question under s6(1)(a) was whether the arrangements placed the employee at a substantial disadvantage, therefore the employer was under a duty to address its mind to the matters in s6(3) and it would be very difficulty to justify a failure to take reasonable steps if no consideration had been given to what steps should be taken. Once the ET found that D took no such steps, and was therefore in breach of the duty under s6, it was not necessary to consider whether the failure was justified. If an employer was fixed with constructive knowledge of the employee’s condition but took no steps to consider reasonable adjustments, justification became irrelevant.

Godfrey v. Royal Mail Group plc; 3103936/04, 18/07/05; EOR 149 p39; ET

Disability discrimination – failure to make reasonable adjustments – postal worker

ET decision that R failed to consider reasonable adjustments to allow G, who could no longer carry out his round by reason of his disability, to remain in employment. R operates a system of “signing” for preferred roles, with roles then being allocated on the basis of seniority. G’s preferred options were refused and withdrawn from the signing exercise. Occupational health advisors suggested possible adjustments, recommending sedentary roles. Offices in the area were not able to produce any jobs meeting these requirements. Ill-health retirement was then recommended by occupational health. The ET held that R failed without justification to make reasonable adjustments, and subjected G to discrimination by dismissal. It failed to make a full and proper assessment of his capabilities for the role which was withdrawn, including failing to discuss perceived difficulties with G or any medical expert. The ET found that the role was withdrawn because the office manager did not want G working there. R failed to consider amending its policies or procedures to facilitate G’s transfer and signing for an alternative post. In doing so it failed to carry out a proper balancing exercise between its obligation to make adjustments for a disabled employee and its obligation to permit transfers of non-disabled employees. There was a reasonable prospect that these steps would have enabled G to remain in employment. R had therefore discriminated.

Greenhof v. Barnsley Metropolitan Borough Council; 05/08/05 (EAT/0285 & 0286/05); IDS Brief 795 p11; [2006] IRLR 98; EAT

 Constructive dismissal – fundamental breach of contract – trust and confidence – failure to make reasonable adjustments – disability discrimination

See above (unfair dismissal).

Hill v. Clacton Family Trust Ltd; [2005] EWCA Civ 1456; IDS Brief 798 p11; CA

Disability discrimination – whether disabled – relevant factors – award of disability living allowance

H worked for C as a care assistant at a home for young people with learning difficulties. In the course of her work she took a group of the children to a stunt show, during which there was an accident whereby a stunt motorcyclist killed a volunteer. H later complained to her GP of feelings of paranoia and anxiety and was referred for counselling. On one occasion she arrived at work suffering from the effects of overdosing on Ecstasy and was summarily dismissed by C. She claimed disability discrimination. Before the hearing she had been awarded disability living allowance by the SSAT on the basis that she was suffering from post-traumatic stress disorder. Nevertheless, the ET held that she was not suffering from PTSD or any other clinically well-recognised illness at the time of disability, and thus did not have a mental impairment qualifying as a disability for DDA purposes. It made a finding of fact that she had not, in fact, witnessed the accident allegedly causing the trauma, and that H’s therapist had implanted into H an understanding of the symptoms of the condition she was seeking to rely upon, enabling her to present herself as suffering from those symptoms. The EAT upheld the decision. H appealed to the CA, complaining that the ET focussed on the question of whether she had witnessed the accident at the expense of the question of whether she was in fact disabled, that it failed to give sufficient weight to the conclusions of the therapist, and that it failed to take proper account of the fact that the SSAT had awarded DLA at the highest rate on the basis that she was suffering from PTSD. The CA held that it was logical for the tribunal, when considering whether H was suffering from PTSD, to start by examining whether she had actually suffered a trauma: indeed, C’s consultant psychiatrist had suggested that it do so. It had correctly gone on to consider all the medical evidence before it and was entitled to reach the view it did of the therapist’s evidence. Whilst the CA accepted that it was unfortunate that the ET and the SSAT had reached different conclusions as to whether H was disabled, the SSAT’s decision was in no way conclusive of the issue of DDA disability and there was no rule or principle of law that the ET was bound to follow the SSAT’s decisions. It was for the ET to make up its own mind on the evidence before it, and its conclusions were unimpeachable on the facts and could not be described as perverse.

McCue v. HM Prison Service; 2305699/04, 27/10/05; EOR 149 p38; ET

Disability discrimination – medical retirement

ET decision that an operations support grade prison worker who was dismissed on grounds of medical retirement following long-term illness with osteoarthritis and spondylosis of the spine was subjected to disability discrimination. P’s focus was on medical retirement rather than considering options for M’s continued working. Although there was medical advice that he could undertake light duties, P continued to take steps towards medical retirement (which M had said that he would not fight). The dismissal was less favourable treatment. P had not shown justification as it had not fully explored what duties M would have been capable of doing on a return to work, instead concentrating on medical retirement. It did not properly or reasonably equip itself to decide on dismissal and failed to make reasonable adjustments by not exploring possible steps. M was also unfairly dismissed. The award for loss of earnings and pension were substantial. The injury to feelings award was at the lower end of the middle Vento band.

Miles v. Gilbank; Times 16/11/05; [2006] ICR 12; IDS Brief 798 p9; EAT

Sex discrimination – fostering and encouraging discriminatory culture – manager’s liability

Reported in the December & January updates. Now also reported at IDS Brief 798 p9.

Millar v. Inland Revenue Commissioners; [2005] CSIH 71; [2006] IRLR 112; CS

Disability discrimination – Whether disabled – mental impairment – physical impairment

M was an administrative officer. He fell in the office toilets, hitting his head and being briefly unconscious. Some time later he began to experience a drooping eyelid associated with sensitivity to bright light. He began to have headaches. He returned to work after 10 days but experienced difficulty in using a VDU screen and went off ill again after a fortnight. Extensive examination by, inter alia, a neurologist, an opthalmologist and occupational health specialists revealed no abnormalitites or organic cause of his condition. Eventually IRC dismissed him on attendance grounds. He complained of disability discrimination. As a preliminary issue the ET held that M was not disabled, directing itself in accordance with Rugamer v. Sony Music Entertainment Ltd and McNicol v. Balfour Beatty Rail Maintenance Ltd. In the absence of any evidence regarding the nature of the mental impairment in order to determine whether it was a well-recognised illness, the ET found itself compelled to find that M was not disabled. The EAT dismissed the appeal. On appeal to the Court of Session, M argued that the impairment was physical, in the sense of something limiting or restricting his ability to do certain things, and that in considering whether there was a physical impairment it was not necessary to identify a cause. The Court of Session held that the ET erred in finding that M was not disabled notwithstanding that M had established facts and circumstances from which it was open to it to find that he had an impairment. Physical impairment can be established without reference to causation or to any form of “illness”. When there is an issue as to the nature of the impairment, it is a matter of fact whether it is physical or mental in character. If physical, that is the end of the preliminary issue. If within Schedule 1 para 1, an additional element of proof was required to show that the physical manifestations of the condition resulted from, or consisted of, a clinically well-recognised mental illness*. In this case, the ET erred by failing to make express findings of fact about M’s condition.

[* NB As of 05/12/05 this requirement has been removed.]

New Southern Railway Ltd v. Quinn; 28/11/05 (EAT/0313/05); IDS Brief 798 p3; Daily Telegraph 26.01.06; EAT

Sex discrimination – Health & Safety – Demotion during pregnancy

Q worked for N from April 2000 as a Station Manager Support Clerk (“PA”). In 2003 she was promoted to Duty Station Manager on a three month trial basis. 2 months later she went on sick leave, and thereafter notified N that she was pregnant. N’s Safety Strategy Manager then carried out risk assessments in relation to the positions of PA and Duty Station Manager. Some “high” and “medium” risks were identified in relation to the Duty Station Manager post, including risks of verbal and physical abuse. However, the risk assessment indicated that a change to Q’s working conditions or hours could reduce these risks to “low”. Various other low risks were identified, including having to stand while working, being exposed to extremes of temperature and to possibly slippery wet platforms. N’s management decided that Q could not continue as Duty Station Manager and informed her that she would return to her original post of PA, entailing a significant reduction in salary. Q contended before the ET that she had been subjected to (a) detriment by reason of pregnancy and/or (b) suspension on grounds of maternity without alternative employment being offered on terms not substantially less favourable (sections 47C and 67 ERA) and (c) sex discrimination. She later resigned and brought further claims for constructive dismissal and unlawful deductions from wages. The ET considered the provisions of Reg 16 of the Management of Health & Safety at Work Regulations (health & safety obligations in respect of, inter alia, pregnant employees) in detail. It concluded that Q was removed from post, not because of health & safety, but because of patronising and paternalistic attitudes of managers. It further held that Reg 16(2) does not impose an absolute obligation to avoid risks to pregnant women, but simply to reduce them to an acceptable level. Thus the Regs did not require Q to be removed from post as other steps could have been taken to “avoid” the risk. The ET therefore held that Q had been discriminated against contrary to the SDA, subjected to a detriment (s47C) and suffered unlawful deductions. It held that N committed fundamental breaches of contract by demoting Q, reducing her salary and failing to confirm her in her post as Duty Manager, and that although Q did not resign for 6 months after these breaches, it could not be inferred in the circumstances that she had waived the breaches and affirmed the contract. Therefore she was constructively dismissed. The EAT held that, as the ET found that Q was not in fact suspended for health & safety reasons, the issue of the construction of Reg 16 did not arise. N had failed in its burden to justify Q’s suspension. Expert health & safety or medical evidence is generally desirable in such a case, but N had provided virtually none as to the risks, had failed to consider appropriate adjustments and had failed to adduce any evidence showing that it was not feasible to reduce risks by altering working conditions or hours. The EAT therefore upheld the ET’s findings of sex discrimination and pregnancy-related detriment. However, the EAT also went on to endorse the ET’s findings in relation to Reg 16: holding that “avoid” in that Regulation “cannot mean eliminate in its entirety but means reduced to its lowest acceptable level”. A balancing exercise is required, with the health & safety reasons for a maternity suspension being weighed against the discriminatory effect of restricting a woman’s right to carry out her normal job. However, even if this construction of Reg 16 was wrong, in the present case the risks identified by N applied just as much to the PA post as to the Duty Station Manager post, thus there was a fundamental flaw in N’s case. In respect of constructive dismissal, the EAT considered that it was difficult to see how Q had not affirmed the contract in respect of the original fundamental breaches. However, the ongoing unlawful deductions amounted to a continuing fundamental breach justifying Q in treating the contract as repudiated. Therefore the ET’s conclusion on constructive dismissal was upheld.

Robinson v. UK Coal Mining Ltd; 2510257/04, 28/07/05; EOR 149 p39; ET

Disability discrimination – redundancy – job created for disabled person becoming redundant

ET decision that employee made redundant when his job, created for him on becoming disabled, was no longer required was subjected to direct discrimination. The ET found that maintaining the job package created for R was an “arrangement”. The redundancy situation became such that this arrangement placed R at a substantial disadvantage compared with the non-disabled who were not subject to his restricted duties. The duty to make reasonable adjustments therefore arose. Reasonable steps could and should have been taken to rearrange job packages to prevent the disadvantage. R was also placed at a disadvantage by the consultation process in that disabled people need more information and thinking time as they have to consider whether they can fulfil the requirements of any proposed alternative employment with regard to their disability. UKCM did not even think about discharging the duty to make reasonable adjustments in respect of the consultation process. The failures to make adjustments were not justified. The dismissal was for a reason relating to R’s disability, in that he was dismissed because he was doing a package of jobs which his employer considered dispensable, and he was doing those jobs because of his disability.

Shepherd & ors v. North Yorkshire County Council; [2006] IRLR 190; EAT

Sex discrimination – aiding unlawful acts – discrimination by others than employers

S was one of about 40 women employed by N (mainly as cleaners and kitchen assistants) who brought equal pay claims comparing themselves to men whose work was said to have been rated as equivalent under job evaluation studies carried out under the 1997n local government single status agreement. The main basis of the claim was that the male comparators continued to receive bonus payments which S did not. S also sought to claim that N knowingly aided, or aided, abetted, counselled or procured three trade unions to discriminate against their members, contrary to s12 SDA (claims which, if successful, might have given rise to awards for injury to feelings and other non-pecuniary loss). The ET chairman struck out this part of the claim, on the basis that it had no reasonable prospects of success, in that if what S said was right, the conspiracy sought to produce a void agreement, the remedy for which would be a declaration and that S would be left with the benefit of the right to Equal Pay and no more. On appeal, the allegation of aiding and abetting was made in an amended form. The EAT dismissed the appeal. S’s claim that N unlawfully aided the unions to discriminate by failing to represent women properly was unsustainable and the chairman was correct to strike it out. Even on the assumption that there was an express or tacit agreement between N and the unions that the single status agreement should not be implemented for as long as possible, it could not be held that N thereby aided the unions in failure to represent members. An employer does not aid a failure by unions to represent members properly merely by agreeing a particular result in collective bargaining. It is one thing to take advantage of a failure, another to aid it. On the pleaded case, the union needed no aid or assistance to fail to represent its members, because this was the union’s own perspective. The employers and unions had their own interests to protect and constituency to represent. Merely because in collective bargaining they agreed an outcome detrimental to a union member, it did not follow that the employer aided the union to fail to represent properly. However, the chairman’s reasoning in holding that there were no reasonable prospects of success was flawed, because if S had made out the case, it would have sounded in compensation (and the employer would have been liable under s42). If two people or organisations agree to commit unlawful discrimination, one aiding the other, their agreement will be void but it does not follow that the victim is without remedy.

Thomas v. East & North Herts NHS Trust; 3300802/04, 21/06/05; EOR 149 p38; ET

Disability discrimination – learning disability – whether transfer out of A&E justified

ET decision that E was justified in transferring a hospital porter with poor reading and writing abilities out of it’s A&E department. T had been offered, but refused, the opportunity of attending adult literacy courses. When he worked alone he had difficulties finding a patient he was supposed to collect because he could not read the name. E concluded that the nature of the work was such that the porter should be able to read and comprehend instructions and act on them swiftly and transferred him to a portering vacancy in the catering department (which was only for 20 hours a week). T left on the first day because he wanted to work full time. The ET concluded that the transfer was direct discrimination, but was justified, particularly having regard to the potentially fatal consequences of any mistake or delay caused by his poor reading skills or comprehension. E had not failed to make reasonable adjustments.

Watts v. High Quality Lifestyles Ltd; 1100008/05, 05/10/05; EOR 149 p37; ET

Disability discrimination – HIV – direct discrimination – reasonable adjustments

ET decision that a support worker (living in residential homes to support people with learning disabilities and autistic disorders) who was dismissed when his employer became aware that he was HIV positive was subjected to direct discrimination on grounds of disability, and that there was a failure to make reasonable adjustments. On occasions support workers are scratched and bitten by clients, sometimes drawing blood. W was HIV positive but his condition was controlled by medication, and his consultant advised H that he was doing well and would continue to do so if he took his medication regularly, and that the risk of occupational transmission of HIV was very small. When H learned of his HIV status, it suspended him and informed him that a risk assessment would be carried out but that it was likely that they would part company. The putative risk assessment did not specifically relate to W’s HIV status but was a general report into “infectious disease transmission”. This report, which the ET considered flawed, gave a high risk rating for all blood-borne diseases and H dismissed W. The ET considered that the dismissal was direct discrimination and was not justified. There was no indication that H had properly taken into account Department of Health guidance, or considered whether or not to appoint an occupational physician to consider reasonable adjustment. The risk assessment was flawed because it was not specific to W’s condition. The way in which the suspension and dismissal were handled led to an inference that H’s approach was to find a way to dismiss W, rather than properly to consider the ways in which his service might be retained. Without a proper risk assessment, with input from W, and without an occupational specialist’s opinion, it was impossible for the ET to say what the outcome would have been. No reasonable employer would have dismissed without having undertaken these detailed investigations. The less favourable treatment was therefore not justified. Further, the ET concluded that H had imposed a provision, criterion or practice that no care worker in its organisation should have HIV. This placed W at a substantial disadvantage in comparison with non-disabled persons. H had not assessed in any detail the possibility of other jobs. The risk assessment was flawed and not a reasonable step in the circumstances. There was therefore a failure to make reasonable adjustments.

X H Diem (known as Anita Ho) v. Crystal Services plc; Daily Telegraph 23.02.06; EAT

Race discrimination – ET procedure – fair hearing – appearance of bias

See below (ET procedure).

Armstrong & others v. Newcastle upon Tyne NHS Hospital Trust; [2005] EWCA Civ 1608; IDS Brief 797 p9; Telegraph 05/01/06; [2006] IRLR 124; CA

Equal Pay – comparators – whether single source responsible for terms and conditions – material factor defence

Reported in the January update. Now also reported at [2006] IRLR 124.

NB Leave has now been sought to appeal to the House of Lords in this case.

Manpower UK Ltd v. Vjestica; 18.10.05 (EAT/397/05); [2006] ICR Part 2 “Recent points” pix; EAT

Holiday pay – basis of calculation – inclusion or not of holiday pay in “earnings”

See below (Working Time Regulations).

Sharp v. Caledonia Group Services Ltd; 09/08/05 (EAT/0041/05); IDS Brief 795 p3; [2006] IRLR 4; [2006] ICR 218; EAT

Equal pay – difference in pay established – burden of proof – employer to show objective justification

Reported in the January update. Now also reported at [2006] ICR 218.

Attorney-General v. Kuttapan; Daily Telegraph 16.02.06; EAT

EAT procedure – Vexatious litigants – restriction of proceedings – s33 ETA 1996

A sought a restriction of proceedings order under s33 ETA 1996 against K, who had commenced at least 33 ET claims of race discrimination. A large proportion of the claims were against his former employer and a local authority (the complaints in the latter case arising out of failed job applications). The various proceedings had taken up over 125 days of ET time and the majority of the claims had failed. A contended that K’s case was particularly extreme, requiring nothing less than a restriction of proceedings order, and that K’s offer to give an undertaking was insufficient to protect the public. The EAT granted the order. K had persistently and habitually and without any reasonable ground instituted vexatious ET proceedings, thus satisfying s33. Although he had decided not to make any further claims and had offered an undertaking to that effect, there needed to be proper control over the extent of his liberty to bring proceedings in the ET (and K had virtually admitted that need). The order was made for an indefinite period.

Calor Gas v. Bray; 12/09/05 (EAT/633/04); [2006] ICR Part 2 “Recent points” px; EAT

Redundancy – Unfair dismissal – Maternity Leave – Consultation – ET procedure

See below (Redundancy).

Commotion Ltd v. Rutty; 13/10/05 (EAT/0418/05); IDS Brief 797 p12; [2006] IRLR 171; EAT

ET procedure – Statutory Grievance procedure – what constitutes a grievance

Reported in the January update. Now also reported at [2006] IRLR 171.

Doherty v. British Midland Airways Ltd; [2006] IRLR 90; EAT

Constructive dismissal – whether there was fundamental breach – ET procedure – fair hearing

See above (Unfair dismissal)

Galaxy Showers Ltd v. Wilson; [2006] IRLR 83; EAT

ET procedure – Statutory Grievance procedure – what constitutes a grievance

W was employed by G as a customer service supervisor. In December 2004 he sent a letter to the general manager complaining about being given a verbal warning about his conduct without any proper investigation or formal disciplinary hearing and indicating that, if matters were not resolved, he would resign at the end of the month. G invited him to appeal against the warning. He refused to do so, on the basis that this would continue the character of a disciplinary meeting and would legitimise a process he considered defective. He resigned and claimed unfair dismissal. The ET upheld his complaint, rejecting G’s argument that W had failed to comply with the statutory grievance procedure and therefore that there was no jurisdiction. The ET considered that the December letter set out a clear statement of W’s complaints about G’s actions and gave them an opportunity to arrange a meeting to discuss those complaints. It concluded that G’s failure so to do was a failure to comply with step 2 of the SGP. G appealed to the EAT. The EAT held that the ET did not err in holding that the letter of resignation contained a statement of W’s grievance so as to fulfil the requirements of EA02, and that jurisdiction was not precluded. It is for the employee to complain in writing about that which the employer has done or not done. G’s contention that a written grievance needed to indicate that the complainant wished to proceed to some discussion or resolution of the complaint was not accepted. What is essential is that the substance of the complaint is raised. The particular form, or time at which it is raised, does not matter. In the present case, the ET was entitled to find that W’s letter of resignation set out very clearly a statement of his complaints about G’s actions against him. It therefore satisfied the definition of a grievance. The ET did not err in holding that W’s refusal to attend a meeting called by way of appeal from the verbal warning did not amount to a failure to attend a meeting which would have complied with the statutory grievance procedure. The SGP requires the employer to invite the employee to attend a meeting to discuss the grievance. That meeting must therefore relate to the substance of the grievance. Although the employer may seek to resolve both complaint and appeal at the same hearing, part of the purpose of the meeting must be to discuss the grievance itself, and the employer must indicate to the employee that there is to be a meeting which in substance will at least in part deal with the complaints already made. In this case, the ET identified the substance of W’s grievance as his objection to being put through a disciplinary process when he should not have been. It was therefore entitled to conclude that, by convening a meeting as part of that disputed disciplinary process, G had not responded to the complaint. The EAT made a general observation that “in any case in which the substance of the complaint has been raised, and in which there has been subsequent discussion between the parties about that complaint, it is likely that the requirements of the Regulations will have been fulfilled”. However, it emphasised that this was guidance and not ratio.

Holc-Gale v. Makers UK Ltd; 21/12/05 (EAT/0625/05); IDS Brief 797 p13; [2006] IRLR 178; EAT

ET procedure – statutory grievance procedures – what constitutes grievance

Reported in the January update. Now also reported at [2006] IRLR 178.

Mark Warner Ltd v. Aspland; 08/12/05 (EAT/0531/05); IDS Brief 797 p6; [2006] IRLR 87; EAT

ET procedure – jurisdiction – statutory grievance procedure – whether solicitor’s letter before action capable of constituting grievance

Reported in the January update. Now also reported at [2006] IRLR 87.

Piscitelli v. Zilli Fish Ltd; 21/12/05 (EAT/0638/05); IDS Brief 798 p7; EAT

Statutory dispute resolution procedures – extension of time – whether letter before action raises internal appeal – ET procedure

P was employed by Z as general manager of its restaurant. He was suspended and then, following a disciplinary hearing, summarily dismissed for gross misconduct (it was alleged that he included a service charge on customers’ bills and took equivalent cash amounts from the till). He was dismissed on 2nd February. On 23rd February his solicitors wrote to Z contending that the dismissal was unfair and stating an intention to bring unfair dismissal proceedings in the ET. A settlement in the sum of £10,000 was sought. Following attempts to negotiate, on 9th May Z stated that it was no longer prepared to discuss the matter. On 11th May P’s solicitors presented the ET1 (10 days outside the normal 3-month time limit). P argued that the claim amounted to an appeal against the decision to dismiss, and thus that P had reasonable grounds for believing that an internal appeal was under way at the expiry of the 3-month time limit, for the purposes of Reg 15(2) of the dispute resolution Regulations. The chairman rejected this argument and dismissed the claim on jurisdictional grounds as being out of time. At the EAT, P argued that the concept of an internal appeal should be construed widely, as with the concept of a grievance for the purpose of statutory grievance procedures as interpreted in a number of recent cases. He further argued that until 9th May, Z had expressed a willingness to meet with him, which he contended indicated a willingness to consider an appeal. The EAT held that the fact that a letter was a letter before action did not of itself prevent it from raising an appeal (or grievance). However, in the present case the letter did not seek reinstatement or re-engagement (invariably the purpose of an internal appeal), instead simply seeking a cash settlement, and there was no evidence before the Chairman that any meeting had been sought by Z to consider revoking its decision to dismiss. Thus he was entitled to conclude that the letter did not raise an appeal. P further argued that Z was in breach of the statutory disciplinary procedures by failing to provide for an internal appeal, and that by not allowing his claim to proceed, the chairman had allowed Z to benefit from its own breach. The EAT rejected this argument, holding that it was first necessary for P to lodge an internal appeal. If he did so and Z refused to entertain it, P’s compensation would have been increased by virtue of Z’s failure. However, he did not lodge an appeal at any stage. Further, if he had lodged an appeal and Z had refused to entertain it, there would no longer have been any basis for believing that an internal appeal was under way and P would still have been required to bring his claim within the normal 3-month time limit. The chairman had not erred in finding the claim time-barred.

Shergold v. Fieldway Medical Centre; 05/12/05 (EAT/0487/05); IDS Brief 797; Telegraph 19/01/06; [2006] IRLR 76; EAT

ET procedure – statutory grievance procedures – whether grievance set out – resignation letter setting out complaints

Reported in the January update. Now also reported at [2006] IRLR 76

Thorpe v. Poat; 18/10/04 (EAT/503/05); [2006] ICR Part 2 “Recent points” pxi; EAT

ET procedure – statutory grievance procedures – whether grievance set out – resignation letter setting out complaints

In December 04 the Cs wrote to their employers complaining about their working conditions, alleging breaches of their contracts of employment and terminating their employment. After the expiry of 3 months, they presented breach of contract claims in the ET. At a PHR to determine whether they were time-barred, the chairman found that the December letter complied with the requirements of the SGP and that the Dispute Resolution Regs operated to extend time. R’s appeal was dismissed by the EAT. The Chairman and parties below had failed to address whether the appropriate procedure was the Grievance Procedure or the Modified Grievance Procedure. The chairman thought it sufficient that Cs raised a grievance about the employer’s action that could form the basis of an ET complaint. It was plainly not that simple. First, the ET had to be satisfied that one or other of the SGPs applied (the chairman proceeded on the basis that they did) or whether they were excluded. The next point was whether the Cs’ letter complied with the requirements of the SGPs. Any contractual grievance procedure was not to the point: the only question was whether the statutory procedure was made out. The chairman was perfectly entitled to find that it was: the resignation letter was a complaint by employees about action which the employer had taken in relation to them. The EAT hoped that in future, parties, advisors and tribunals would be alert to the potentially complex issues (not raised in the present case) raised by Reg 6 of the Dispute Resolution Regs.

Uyamnwa-Odu v. Schools Offices Services Ltd; Independent 01/12/05; [2006] ICR Part 2 “Recent points” pxi; EAT

ET procedure – case management – “unless order” under rule 13 – whether conditional judgment

Reported in the January update. Now also reported at [2006] ICR Part 2 “Recent points” page xi.

X H Diem (known as Anita Ho) v. Crystal Services plc; Daily Telegraph 23.02.06; EAT

Race discrimination – ET procedure – fair hearing – appearance of bias

H is of Vietnamese origin. She complained of unfair dismissal, race discrimination and victimisation against C, claiming inter alia less favourable treatment on grounds of her Vietnamese race, but not claiming discrimination on grounds of colour. During her cross-examination, the Chairman asked whether she was seeking to expand her claim to include an allegation of less favourable treatment on grounds of colour. He questioned her about her skin colour and made comparisons between hers and his own. On appeal, H contended that the chairman’s questioning was racially insensitive and would appear offensive to any reasonable person such that a fair-minded observer would conclude that there was at least a real possibility of unconscious bias or misconduct, denying her a fair trial. Her appeal was allowed. The case concerned apparent bias. Claims of race discrimination needed to be handled with sensitivity by tribunals, and whilst the chairman’s desire to establish whether H was departing from her pleaded case was legitimate, his enquiry crossed the line when he questioned H at length about her skin colour and made comparisons with his own. A fair-minded observer would conclude that the remarks were such as to cause H to feel unsettled, humiliated and embarrassed, and that there was a real possibility of unconscious bias on the chairman’s part.

Melia v. Magna Kansei Ltd; Times 14/11/05; IDS Brief 797 p7; [2006] IRLR 117; CA

Whistleblowing – detriment – constructive dismissal – injury to feelings – award

Reported in the December and January updates. Now also reported at [2006] IRLR 117.

New Southern Railway Ltd v. Quinn; 28/11/05 (EAT/0313/05); IDS Brief 798 p3 Daily Telegraph 26.01.05; EAT

Sex discrimination – Health & Safety – Demotion during pregnancy

See above (Sex Discrimination)

Krasner v. McMath; Duggins v. Tipper; Harris v. Ellis; [2005] EWCA Civ 1072; [2005] IRLR 995; IDS Brief 792 p9; [2006] ICR 205; CA

Payments in lieu of notice – Employer’s insolvency – Redundancies – Protective Award

Reported in the December update. Now also reported at [2006] ICR 205.

Calor Gas v. Bray; 12/09/05 (EAT/633/04); [2006] ICR Part 2 “Recent points” px; EAT

Redundancy – Unfair dismissal – Maternity Leave – Consultation – ET procedure

B became redundant whilst on maternity leave. The ET upheld her complaint of unfair dismissal because she had not been offered suitable alternative employment which was available. The ET further found that the consultation process was unfair, amongst other things because of a failure to advise B that consultation could be extended to the end of her maternity leave. C’s appeal was allowed. The EAT was concerned by the ET’s view that the consultation period would automatically be extended by virtue of maternity leave. The ET (in relation to Reg 10 of the 1999 Maternity etc Regs) should first consider whether it was practicable by reason of the redundancy for the employee’s current employment to continue (i.e. the employer needed to show that it was necessary to implement the redundancy during the period of maternity leave). The ET should then determine when the existing contract of employment terminated and whether any suitable alternative vacancy was available prior to that termination. C conceded that it was arguable that the normal consultation period might have to be extended because of the special circumstances involved in maternity leave. However, in the absence of any specific finding that the need to implement the redundancy could be postponed until the end of the maternity leave, it could not be accepted that on a proper interpretation of Reg 10, the consultation period for considering alternative vacancies would automatically be extended. The ET’s view on this issue might well have clouded its view regarding the reasonableness of C’s approach to one possible vacancy. The ET further erred in ruling that C could not cross-examine B about her childcare arrangements generally. C complained further (and the EAT agreed) that the ET had dealt with the issue of suitability of alternative vacancies by saying that this was a decision entirely for B. Vacancies could arise either by being suggested by the employer (in which case the ET would have to judge the employee’s reasons for refusal) or by being suggested by the employee (in which case the employer’s refusal would have to be judged by the ET in the light of the statutory tests). To suggest that the decision was entirely for the employee omitted the ET’s role in assessing whether B’s decision was reasonable in the circumstances. Finally, C asserted bias. The suggestion from the chairman, in response, that both sides had been treated in the same way was not borne out by close analysis of the interventions that took place. The partiality shown by the ET might have had an impact on its view of the central issue, namely that of suitable alternative vacancies.

Cotswold Developments Construction Ltd v. Williams; [2006] IRLR 181; EAT

Whether or not contract of employment exists – worker – applicable tests

See below (Contract of Employment).

Dellas & others v. Prime Minister & another; C-14/04, 01/12/05; IDS Brief 798 p5; [2006 IRLR 225; ECJ

Working Time – hours spent on call at employer’s premises – whether counts for working time requirements – Article 2 of the Working Time Directive

D was employed as a special needs teacher in a residential school in France. His job included spending nights on call at the school premises. French national legislation implementing the Working Time Directive made specific arrangements for calculating “working time” for workers on call at ‘social or medico-social establishments operated by private persons in a non-profit-making business’, involving a weighting system whereby the first 9 hours on call at night are treated as three hours of working time, and each hour thereafter is treated as 30 mins. D’s working time was calculated using this system. He disputed the calculation of his working hours and was dismissed. D brought proceedings, seeking annulment of the domestic provisions on the grounds of incompatibility with the Directive. 2 questions were referred to the ECJ: (a) whether the Directive’s definition of “working time” must be applied in France even though the average weekly working time limit of 44 hours in French domestic law provides greater protection than the 48 hours required by the Directive; and (b) whether a system taking into account total hours present, but applying a weighting mechanism to reflect a lower intensity of work during periods of inactivity, could be incompatible with the Directive. The ECJ reconsidered the Directive, noting the distinction between “working time” and “rest period” as mutually exclusive concepts in Art 2, and that there is no provision for an intermediate category of time spent working but at a lower intensity, the definition of “working time” being silent as to level of output. The fact that on-call duty include some periods of inactivity was therefore completely irrelevant. Further, it was not for member states to interpret the concepts of “working time” and “rest period” in accordance with their own requirements, those being concepts of EC law defined in accordance with the objective and purpose of the Directive. Further, it is settled case law that on-call duty on an employer’s premises counted as “working time” and must be included in calculation of an employee’s working time. Thus the weighting system was incompatible with the Directive. Although the Directive allowed member states to introduce more favourable provisions than the protections set out in the Directive, where a member state chose to do so, each of the minimum requirements imposed by the Directive still had to be complied with, by reference to and without derogation from the definitions (including of “working time”) contained in Art 2. As the French government conceded, a practical effect of the weighting system could be to impose an overall working week of 60 or more hours, thus breaching the maximum of 48 hours in the Directive. Thus, periods of on-call duty had to be taken into account in their entirety in calculating working time, irrespective of the fact that during those periods the employee concerned was not continuously carrying out any professional activity.

Manpower UK Ltd v. Vjestica; 18.10.05 (EAT/397/05); [2006] ICR Part 2 “Recent points” pix; EAT

Holiday pay – basis of calculation – inclusion or not of holiday pay in “earnings”

V’s contract of employment provided that his holiday pay was to be based on average earnings over the 12 weeks preceding the holiday. In calculating that pay, M excluded holiday pay received by the employee from the previous 12 weeks’ earnings. V alleged that this amounted to unlawful deductions. The ET upheld that claim. The EAT dismissed M’s appeal. The question was whether holiday pay received during the relevant 12 week period ought to be counted as “earnings”. M argued that if it did count as earnings, V would receive a double benefit, and that remuneration under s224 did not include holiday pay and therefore could not be considered “earnings” (Secretary of State for Employment v. Haynes). The EAT held that the ET was perfectly entitled to construe earnings as holiday pay. It was significant, on the facts, that in calculating average earnings M included, inter alia, maternity, paternity, adoptive leave and sick pay. Applying Lord Hoffmann’s test in Investors Compensation Scheme v. West Bromwich Building Society, the expression “earnings” would convey to a reasonable person (with the necessary background knowledge at the time the contract was entered into) that it included all payments made to the employee under the terms of the contract, i.e. including holiday pay. The fact that in practice the employer did not include that form of pay did not alter the meaning of the word in the contractual term, particularly where there was no logical distinction between that and, say, sick pay. The double benefit point did not arise if it was accepted that holiday pay was part of the employee’s earnings. Haynes governed the expression “remuneration” in the context of a normal hours contract, and was not authority for the general proposition that holiday pay did not fall within the meaning of remuneration, particularly as that expression was understood as a result of s224. If M wished to reflect precisely the statutory definition under Reg 16 WTR, it was open to it to use the expression “remuneration” instead of “earnings” or to exclude holiday pay expressly. However, had M done that it might have fallen foul of Reg 16.

Rose v. Dodd; Times 16/08/05; Independent 04/10/05; [2005] ICR 1776; [2005] IRLR 977; [2006] 1 All ER 464; CA

Transfer of Undertakings – Solicitor – Law Society intervention – whether termination of contract

Reported in the October, November and December updates. Now also reported at [2006] 1 All ER 464.

Willow Oak Developments Ltd (trading as Windsor Recruitment) v. Silverwood & others; [2006] ICR 55; [2006] IRLR 28; IDS Brief 798 p10; EAT

Unfair dismissal – reasons for dismissal – refusal to sign new contract containing restrictive covenant – SOSR – whether reasonableness of covenant relevant

See above (unfair dismissal).

Cotswold Developments Construction Ltd v. Williams; [2006] IRLR 181; EAT

Whether or not contract of employment exists – worker – applicable tests

C engaged W in 2002 to work as a carpenter on work that C was sub-contracted to do in relation to the provision of maintenance services to London Underground. He had no written contract and was dismissed in 2004. He claimed unfair and wrongful dismissal and non-payment of holiday pay. C denied that he was an “employee” for UD/WD purposes under ERA s230 or a “worker” for holiday pay purposes under WTR Reg 2(1). The ET found as facts that W worked regularly for C throughout the 21 months of his engagement, there was no suggestion that he had worked for anyone else during that time, there were occasions when no work was available for him and others when he refused work. He was paid a set amount per 6-hour shift, less deductions for income tax under the CIS. His pay was not reduced if he finished work early. He was generally not paid when he did not work, though occasionally was paid the equivalent of half a shift. He was supervised and was asked to attend courses to satisfy London Underground requirements. He was provided with the use of a company van. The ET concluded that he was required to perform the work personally, that C were not clients of his business undertaking, and that he was therefore a “worker” for WTR purposes, but that he was not an “employee” for ERA purposes because there was no mutuality of obligation. The ET observed that had there been mutuality of obligation, it would have concluded that W was sufficiently subject to C’s control to render the relationship one of employment. Both parties appealed. The EAT allowed both appeals and remitted the case to the same ET. The ET erred in holding that W was not an “employee” but that he was a “worker”. It had not adopted the appropriate test in determining W’s employment status and its reasoning was inconsistent. Mutual obligations are necessary for there to be a contract. If there is a contract, it is necessary to determine what type it is, having regard to the nature of the obligations mutually entered into. It cannot simply be control that determines whether the relationship is one of employment or not. The contract must also necessarily relate to mutual obligations to work and to pay for (or provide) it. If there is no obligation to work, there cannot be a contract of employment. Although there is scope for the employer’s obligation to vary (as between the provision of work, payment for it, retention on the books or conferral of some non-pecuniary benefit), the concept of mutuality of obligation cannot be stretched so as to avoid the necessity for the employee to be obliged to provide his work personally. “Service”, i.e. the obligation to work personally for another, is retained at the heart of the relationship by s230 ERA. The phrase “mutuality of obligation” is most often used when the question is whether there is a contract to as to qualify a party for employment rights or holiday pay. In this situation, a succession of short contracts under each of which the person providing the services is either an “employee” or a “worker” will not give rise to those rights unless (i) the individual instances of work are treated as part of the operation of an overriding contract, or (ii) s212 ERA preserves continuity. Such an overriding contract cannot exist as a contract of employment separately from the individual assignments if there is no minimum obligation under it to work at least some of those assignments. However, the overriding contract is not deprived of mutuality of obligation if the employee has the right to refuse to work or the employer to choose to withhold it. The focus has to be on whether there is some obligation on the individual to work and some obligation on the other to provide or pay for it. Under WTR, the definition of “worker” focuses not on the employer’s obligations (provided there is sufficient to ensure that there is a contract between them), but on the nature of the obligation on the worker. The WTR recognises that there will be “workers” who are not “employees” but who undertake to do work personally in circumstances where the “other” is not a client or customer of theirs. The definition of “client” or “customer”, therefore, cannot depend on the fact that the contract is being made with someone who provides personal services other than as an employee. The distinction is not that between employee and independent contractor: the paradigm case falling within Reg 2(1) is that of a professional: e.g. solicitor-client, or shop customer and shop owner, or customer of a tradesman such as a domestic plumber commercially marketing his services as such. Thus, a focus upon whether the purported worker actively markets his services as an independent person to the world in general, or whether instead he is recruited by a principal to work as an integral part of that principal’s operations, will generally demonstrate on which side of the line he falls.

Thus, in determining whether someone such as W was an “employee” or a “worker”, the central questions are:

was there one contract or a succession of shorter assignments;

If the former, was it the natural inference from the fact that W agreed to undertake some minimum, or at least a reasonable, amount of work for C in return for being given that work, or pay;

If so, was there such control as to make it a contract of employment;

If not, or if there was any factor negating employment, was W nevertheless obliged to do some minimum (or reasonable) amount of work personally.

The tribunal did not appear to have addressed the question of whether W had obliged himself to do some minimum amount of work. The facts that there was regular contact as to whether he wished to work on a particular day, that on occasion he declined work or there was none available and he was not paid, did not answer the question whether the relationship was such that on a sufficient number of days he was obliged to do so.

Giannelli v. Edmund Bell & Co Ltd; 06/09/05 (EAT/192/05); [2006] ICR Part 2 “Recent points” pxii; EAT

Contract of employment – whether “worker” under s230 ERA 1996 – unlawful deductions

G was a self-employed commercial agent. He left E’s employ in 1997 and entered into a sales agency agreement whereby he received commissions based on sales, which were paid without deduction of tax or NI contributions. He undertook work for other principals, but in September 1999 agreed to stop working for one of these and not to take on any more, and was paid an annual retainer of £8,500 by E. The retainer was terminated in 2004. G complained of unlawful deductions. An issue arose as to whether he was a “worker”. The ET rejected his claim on the basis that he was not. The EAT upheld his appeal. The ET had failed to deal properly with the issue of whether or not G acted in the capacity of a business undertaking of which E was the customer. Its essential task was to determine the level of control and dependence (including economic dependence) judged by numerous factors including those set out in Byrne Bros v. Baird. An additional important factor in this case was that G acted for more than one principal, although it was necessary to examine the relationship between G and each principal, particularly as there was a predominant principal (E). The EAT was concerned that the ET’s failure to give closer attention to the precise terms of the agency agreement had led to 2 important errors in its fact finding. It was incumbent on the ET to carry out some analysis of the written agreement in order to determine the degree of dependency and control under that contract. Far more important was the ET’s failure to consider the effect of the change of arrangements in 1999 in relation to the retainer and the imposition of the condition about other agencies. This was a significant alteration in the nature of the parties’ relationship which might have some bearings on conclusions as to control and dependency. The case would be remitted.

Gryf-Lowczowski v. Hinchingbrooke Healthcare NHS Trust; [2005] EWHC 2407; IDS Brief 795 p8; [2006] IRLR 100; High Court (QB)

Contract of employment – contract terms – frustration – requirement of re-skilling programme – injunction to compel performance of employment contract

Reported in the January update. Now also reported at [2006] IRLR 100.

Percy v. Church of Scotland Board of National Mission; Times 16/12/05; Independent 20/12/05; IDS Brief 798 p9; [2006] IRLR 195; [2006] ICR 134; HL

Whether or not contract of employment exists – Church minister

Reported in the January update. Now also reported at IDS Brief 798 p9 and [2006] IRLR 195.

Gryf-Lowczowski v. Hinchingbrooke Healthcare NHS Trust; [2005] EWHC 2407; IDS Brief 795 p8; [2006] IRLR 100; High Court (QB)

Contract of employment – contract terms – frustration – requirement of re-skilling programme – injunction to compel performance of employment contract

See Contract of Employment (above).

Re Criminal Proceedings against Grongaard & anor; C-384/02; [2006] IRLR 214; ECJ

Information & Consultation – Insider dealing – information gained in capacity as representative – criminal proceedings

G was an employee-elected representative of the board of a major financial institution (R) quoted on the stock exchange, and a member of its corporate liaison committee. Following a board meeting, G disclosed to the general secretary of the relevant union (B) R’s proposal to enter merger negotiations with another quoted financial institution. B passed on the information to other union colleagues, one of whom, C, bought shares in R. Further details of the merger were discussed at other meetings at which G was present. He approached B with the aim of helping employees to deal with the consequences of the merger. G and B discussed its timetable and the expected rise in R’s share price. Again, B passed this on to C who purchased further shares. The merger was later made public and R’s share price increased by 65%. C made a substantial profit on his shares and was later sentenced to 6 months’ imprisonment for insider dealing. Criminal proceedings were brought against B and G for disclosing insider information. The court referred a number of questions to the ECJ for a preliminary ruling. The ECJ held that the exception in Art 3(a) of Directive 89/592 [on insider dealing] to the prohibition on disclosing inside information, permitting its disclosure by a person in the normal course of exercising their employment profession or duties, must be interpreted strictly. Disclosure of inside information by a person who receives it in his capacity as an employee representative to the general secretary of the professional organisation which organises those employees can therefore only be justified if such disclosure is strictly necessary for the exercise of the employment, profession or duties of the person concerned and is proportionate. Where there are successive disclosures, each must comply with those requirements. The same principles apply to the disclosure by a general secretary of a professional organisation, who receives inside information, to his colleagues.

Stewart v. Moray Council; 09/12/05 (IC/3/2005); IDS Brief 799 p5; [2006] IRLR 168; CAC

Information & Consultation – “Pre-existing agreement” – whether valid – obligation to consult

The Regs provide a number of circumstances in which employers must commence negotiations with employees with a view to establishing an information and consultation framework in the workplace. One is where, absent a valid pre-existing agreement, 10% of the employees in the undertaking request such negotiations (Regs 7(1) and 7(2)). Where there is a valid pre-existing agreement, the obligation only arises automatically if the request is made by at least 40% of the workforce. Between 10% and 40%, the employer is entitled to hold a workplace ballot and is only obliged to consult if at least 40% of employees in the undertaking endorse the request on ballot. Regulation 8(1) determines the criteria which a pre-existing agreement must meet in order to be “valid”. In the present case, between 10% and 40% of employees requested negotiations. It fell to the CAC to determine whether the existing agreements were a valid pre-existing agreement. M relied on 3 agreements. The issue was whether they covered all the employees in the undertaking, were approved by the employees, and set out in sufficient detail how the employer was to give information to the employees. S argued that the agreements provided for consultation with unions only, contained no mechanism for consultation with non-union members and thus could not be said to cover all employees. However, the CAC rejected that argument. It was satisfied that all M’s employees fell within the auspices of the agreements, which related to negotiation and consultation for M’s employees without differentiating between members and non-members. S contended that the collective agreements had been approved by union representatives only, with no attempt to seek the endorsement of non-union members, notwithstanding that M’s employees had signed contracts of employment which referred to the agreements. The CAC accepted that the employees had not given retrospective approval simply by entering into contracts of employment. Nevertheless, the approval by union representatives amounted to approval “by the employees” for the purposes of Reg 8: “Whether or not individual employees choose to join a trade union does not alter the fact that, firstly, trade union representatives represent all employees and, secondly, a majority of the workforce belongs to one of the recognised unions”. However on the third issue, the CAC decided that the statement in the agreement that the Joint Negotiating Committee under the “Framework Agreement” would be “a forum for discussion and/or consultation on a range of matters not subject to national bargaining” was an insufficiently detailed description of the way M should inform and consult teaching staff. Therefore the agreement did not fulfil the requirements of Reg 8 and was not a valid pre-existing agreement.

Aon Trust Corpn v. KPMG (a firm) & others; [2005] EWCA Civ 1004; [2006] ICR 18; [2006] 1 All ER 238; [2006] 1 WLR 97; CA

Pension scheme – underprovision – trustees’ power to adjust benefits by reference to actuarial valuation of fund – basis for calculation

Reported in the January update. Now also reported at [2006] 1 WLR 97.

Mangold v. Helm; C-144/04; [2006] IRLR 143; ECJ

Fixed-term employees – EC law – Age discrimination

M was employed by H, a lawyer, under a fixed-term contract, when he was 56. The contract limited the term of his contract, referring specifically to specific German domestic provisions intended to make it easier to conclude fixed-term contracts with older workers where an employee was over 52 years old. This legislation provided that the maximum term of a fixed-term contract was two years, and that within that limit, the contract could be renewed up to three times, but that these conditions did not apply if the employee had reached the age of 60 when the fixed term contract began. Subsequent legislation reduced that age limit, and stated that a fixed-term employment contract would not require objective justification if when starting the relationship had reached the relevant age. Shortly after commencing employment, M complained that his contract was incompatible with the EC Framework Agreement on fixed-term contracts and with the age discrimination provisions in the Framework Employment Directive 2000/78/EC, even though its provisions accorded with the German legislation implementing those EC Directives. The domestic court referred a number of questions to the ECJ. The ECJ held that the German legislation lowering the age above which fixed-term contracts could be concluded without restrictions did not contravene the EC provisions in relation to fixed-term contracts. Reduction of the protection afforded to workers in the sphere of fixed-term contracts is not prohibited by the Framework Agreement on fixed-term contracts, where such reduction is in no way connected to the implementation of that Agreement. In the present case, the reductions of the age above which the conclusion of a fixed-term contract was permissible without restriction was justified, not by the need to put the Framework Agreement into effect, but by the need to encourage the recruitment of older persons in Germany. However, in the situation was different in respect of the EC age discrimination provisions. EC law precludes domestic provisions which authorise, without restriction, the conclusion of fixed-term contracts once the worker is 52 or over save where there is a close connection with an earlier indefinite contract with the same employer. The EC legislation provides that member states may provide that differences of treatment on grounds of age shall not constitute discrimination if, within the context of national law, they are objectively and reasonably justified by a legitimate aim (including legitimate employment policy, labour market and vocational training objective) and if the means of achieving that aim are proportionate and necessary. The legislation in question introduced difference of treatment directly on grounds of age. Although the purpose was clearly to promote vocational integration of unemployed older workers (a legitimate objective), the means could not be regarded as appropriate and necessary. The legislation resulted in a situation in which all workers aged 52 or over, without distinction (whether or not they were unemployed before the contract was concluded and whatever the duration of any period of unemployment), could lawfully be offered fixed-term contracts which could be renewed an indefinite number of times. In so far as the legislation took the worker’s age as the sole criterion for the application of a fixed-term contract, when it had not been shown that fixing an age threshold was objectively necessary to the attainment of the objective, it must be considered to go beyond what was objectively necessary. It could not therefore be justified, even though the period prescribed for transposing the age discrimination provisions into domestic law had not yet expired. The principle of non-discrimination on grounds of age had to be regarded as a general principle of EC law, and the observance of the principle of equal treatment could not be conditional upon the expiry of the period for implementation. It was the responsibility of the national court, hearing a dispute involving the principle of non-discrimination in respect of age, to provide the legal protection which individuals derive from EC law and to ensure that those laws are fully effective, setting aside conflicting provisions of national law even where the period for implementation has not yet expired.

R (Ozturk) v. Secretary of State for the Home Department; [2005] EWHC 1433 (Admin); [2006] ICR 178; HC

EC – Freedom of movement – Right to work – Student – Application to remain as worker - Immigration

O was a Turkish national who entered the UK as a student with permission to undertake part-time employment. After using the work entitlement for over 12 months, O applied for leave to remain in employment under the EC’s Association Agreement with Turkey. This was refused on the grounds that O entered as a student (albeit with permission to enter part-time employment), so was not a “worker” for the purposes of the agreement and did not enjoy the rights conferred by that agreement. The court granted O’s application for judicial review. The fact that a person entered as a student was not in any way connected with the enjoyment of the rights he acquired through working legally. Since the purpose of the Agreement embraced the implementation of a system of gradual integration of Turkish workers into the host state’s labour so, a student who was permitted to, and did, part-time work accrued the rights conferred on a worker by the Agreement by meeting the definition of “worker” under that agreement.

R (Payir) v. Secretary of State for the Home Department; [2005] EWHC 1426 (Admin); [2006] ICR 188; HC

EC – Freedom of movement – Right to work – Au pair – Application to remain as worker - Immigration

P was a Turkish national who entered the UK as an au pair on condition that she did not enter employment, paid or unpaid, other than as an au pair. She was entitled to work 5 days a week for 5 hours per day. The Immigration Rules governing extensions of stay provided that an au pair could not remain in the UK for more than 2 years in that capacity. After that period, P applied to remain in the UK as an au pair, relying on the EC Association Agreement with Turkey. The application was refused on the grounds that the work she did did not amount to employment for the purposes of the Agreement. P’s application for judicial review was granted. Irrespective of the fact that the primary purpose of a Turkish national entering the UK as an au pair might be to learn English, there was a genuine employment relationship between her and the family she worked for. That work qualified her as a “worker” for the purposes of the Agreement provided that it was not so minor as to be regarded as purely marginal or ancillary: work for 5 hours a day 5 days a week could not be so regarded. P was therefore entitled to an extension to her leave to remain and, to the extent that they preclude the grant of an extension of stay to a Turkish au pair otherwise entitled to an extension, rules 92 to 94 of the Immigration Rules are unlawful.

Copsey v. WBB Devon Clays Ltd; [2006] ICR 205

Unfair dismissal – Other substantial reason – terms of employment – hours of work – right to religion

Leave to appeal from the CA ([2005] EWCA Civ 932) refused by the House of Lords. The decision of the CA was reported in the October and December updates.

Madarassy v. Nomura International plc

CA appeal was due to be heard on 22nd and 23rd February 2006.

Fletcher v. Blackpool Fylde & Wyre Hospitals NHS Trust

CA appeal due to be heard on 27th and 28th March 2006.

Hoyland v. Asda Stores Ltd

CA appeal due to be heard on 16th & 17th March 2006.

Majrowski v. Guy’s & St Thomas’s NHS Trust

HL appeal due to be heard in May 2006.

Matthews v. Kent & Medway Towns Fire Authority

HL appeal was heard on 11th & 12th January 2006.

Secretary of State for Trade & Industry v. Rutherford (No. 2)

HL appeal due to be heard on 6th to 8th March 2006.

B v. BA

CA appeal was due to be heard on 6th February 2006.

Derbyshire v. St Helens Council

HL has given permission to appeal.

Villalba v. Merrill Lynch & Co

EAT appeal was due to be heard on 14th February 2006.

Home Office v. Bailey

CA appeal against recent EAT decision due to be heard in June 2006.

HL appeal against last year’s CA decision due to be heard later this year.

SITA (UK) Ltd v. Hope

CA appeal due to be heard on 1st & 2nd March 2006.

Serco Ltd v. Redfearn

CA appeal due to be heard on 28th & 29th March 2006.

BUPA Care Homes (BNH) Ltd v. Cann; Spillett v. Tesco plc

EAT appeal was due to be heard on 31st January 2006, examining relationship between the jurisdictional time issues under the Employment Act 2002 and the ET discretion to extend time on a just and equitable basis under the discrimination legislation.

The DTI has now published three sets of draft regulations on maternity/paternity/adoption leave and flexible working, for the purposes of consultation. The regulations are intended to take effect in April 2007. They are the Maternity and Parental Leave (Amendment) Regulations 2006 [removing qualifying period for AML, extending notice period required to notify employer of intended return to work before end of AML, entitling employer to make reasonable contact with an employee on maternity leave, introducing “keeping in touc