Morrish Solicitors Employment Rights Blog

In the Spotlight: Tribunal Fees

2012-01-27T02:51:00.000-08:00

The Ministry of Justice has now published its consultation paper in relation to charging fees in Employment Tribunals. The Department is seeking opinions 2 proposals put forward in relation to the structures. It is, however, clear that fees will be introduced irrespective of any access to justice issues.

Both proposals divide claims into levels according to the potential complexity of the claim, with more straightforward areas of the law being level 1 (for example breach of contract and unlawful deductions from wages), level 2 claims for more complicated cases such as unfair dismissal and complaints in relation to failure to inform and consult under TUPE, and then the most complicated claims such as equal pay and discrimination are at level 3.

What this means is that it may cost £150 to issue a level 1 claim under option 1 or £200 under option 2. It is proposed that this fee will apply irrespective of the value of the claim. So what this means in practice is that an employee who is owed say £50 unpaid wages will have to pay 3 or 4 times the amount that he is owed in order to reclaim that amount. Employees who simply want a declaration as to their terms and conditions of employment will also have to pay this fee.

If option 1 is adopted, not only will the individual have to pay the £150 on issue, but if the case has to be determined at a hearing, they will then have to pay an additional £250 hearing fee.

Level 3 claims will have to pay £250 issue fee plus a staggering £1,250 hearing fee.

What that will mean in practice is that employees are likely to be dissuaded from pursuing low value complaints simply because the Tribunal fees will be more than they could expect to recover from a claim. There does not appear to be any proposal for a dispensation of the fee in such low value claims.

It is also likely to mean that employers will be taking a tactical approach to claims and may defend claims to a hearing on the basis that the level of the hearing fee that will have to be paid will again put individuals off continuing their claim and the claim is then more likely to be withdrawn.

So whilst the Government’s intention is to encourage early resolution of workplace disputes, the effect will simply be to prevent employees from pursuing complaints and access to justice will limited.

And what does “low value” mean? We’re sure that for the politicians £250 is no great shakes; but for many people it’s a week’s pay. But who will be able to risk (or simply, afford) £150 to try to recover £250. It’s the people who can least afford to take the hit, who will have to do so under the proposed regime.

Toni Haynes - Solicitor

For further information, please contact our Employment Rights team on 0113 245 0733

Do Governments Have Ears?

2011-11-30T01:09:00.000-08:00

I’ve just read the Government’s response to its ‘Resolving Workplace Disputes’ consultation. We submitted our own views (copies available for free if you are interested - email us if you’d like to see what we thought) and now we can see what the politicians think.

Our view was that a 12 months qualifying period for eligibility to claim Unfair Dismissal was alright. 2 years is too long. Surely a decent employer will know inside a year whether they need to dismiss? And there’s the adverse effect on staff job security too.

The Government noted:

- Most consultation respondents disagreed with increasing the period to 2 years
- The increase would not reduce the number of claims by the amount the government had forecast (read: their scaremongering was overdone)
- Minority groups (e.g. women, disabled people) would probably be proportionately worse off following the increase
- Small businesses weren’t any more affected by these claims than bigger ones

Good. That’s settled then. No need to increase the qualifying period.

The 2 year limit comes into force in April 2012.

And despite negative responses to the idea of ET judges sitting alone in these cases, the Government’s going to do that, too.

I’ve wondered for a few years now whether there’s any point responding to Government consultations. Why ask the experts when you’ve made up your mind already?

- Paul Scholey, Senior Partner

Flexible Working

2011-11-24T00:39:00.000-08:00

The coalition government is keen to reform employment laws, but for the better?

The Beecroft Report, commissioned by David Cameron, calls for the abolition of the right to request flexible working, in addition to the removal of employee protection for unfair dismissal.

Currently, employees with children under a certain age and carers are entitled by statute to make a request to work flexible hours, subject to meeting certain qualifying criteria and as long as they follow strict procedures. There is no obligation on an employer to grant the request, but it must be considered seriously.

It has been said by the coalition government that it is committed to extending those statutory rights to request flexible working to all employees, not just parents and carers. However, it is feared by Adrian Beecroft, a venture capitalist, that extending flexible working would have a detrimental effect on businesses and would lead to a tidal wave of flexible working requests.

The Chartered Institute of Personnel and Development (CIPD) in response has made a Freedom of Information request to see how many tribunal claims relate to the right to request flexible working. The figures show that out of 218,100 claims accepted in 2010/2011, only 277 alleged that employers failed to consider a request for flexible working. 229 of these were successfully conciliated and only 10 of the 48 claims that reached the Tribunal were successful.

So is it not now clear that the fears expressed about extending the right to flexible working are grossly exaggerated? CIPD say the figures show that most employers already recognise that flexible working is an integral part of the modern workplace and are happy to consider such requests. That may be the case. Or it may be that the statutory right to request flexible working arrangements lacks any real teeth and the procedures to be followed to make a valid request are simply too rigid. It is very difficult for employees to do anything about an employer’s refusal to allow flexible working.

Either way, it seems unlikely that the extension of the right will lead to an avalanche of requests. Even if requests were to increase, surely a good employer would recognise that employees who get to work flexibly are likely to work harder and are more loyal. Hopefully, the government will stick to their guns and increase flexible working rights. In this tough economic climate there is too much emphasis on diluting employees’ rights, which could ultimately be counter-productive. Promoting a good work-life balance is so easily forgotten.

- Daniel Kindell, Solicitor

For further information, please contact our Employment Rights team on 0113 245 0733

Retirement? What Retirement?

2011-10-17T00:34:00.000-07:00

I think we are all slowly coming to realise that with the rising costs of living, increase in university fees and the like, we’ll all be needing to work longer in the future. Also, with improving health and people living longer, many want to work and not retire. With the recent removal of the default retirement age of 65, it’s got to be a good thing that employees will be able to choose to work beyond 65 if they wish to.

A recent survey of employers shows this. It indicates that the majority of employers are doing without a default retirement age. The survey of senior HR professionals in the UK, reveals, among other things, that only 3% of employers intend to keep a specific retirement age, 86% of employers are letting employees over the age of 65 continue in the same role and nearly half of employers are considering flexible working arrangements for over 65s.

That sounds positive, but on the other hand, only 11% of employers recognise the potential benefit of retaining experienced employees more easily.
What it does show is a shift in ‘mind set’ which means older employees will find it easier to remain working for their employer well after they reach 65.

- David Sorensen, Partner

For further information on Employment Rights, please visit our website or call 0113 245 0733 and ask to speak with our Employment Rights team.

EAT rules students should be allowed to see their teacher's face

2011-10-04T06:19:00.000-07:00

The recent news that France has imposed the first Niqab fines on 2 French Muslim women who continue to wear the full-face veil despite the new law banning it, prompts us to think about the position in relation to the manifestation of religious belief in the UK.

The law appears reasonably well settled and has been consistently interpreted, but many of the well reported cases have been appealed to as high as the European Court of Justice: judgment in the case of Jivraj v Hashwani2011 UKSC 40 has been given this month by the Supreme Court.

Notwithstanding the hysterical approach adopted by the media, at large the decisions this far taken in the UK have been in line with common sense.

Significantly, but not widely reported, AishahAzmi, the British Muslim teacher who refused to remove her veil in a primary school when male colleagues were present, was told by the EAT to let her students see her face; an approach most would think in line with common sense – students should be able to see their teachers face, it was argued, and our courts have not disagreed. Certainly there is no evidence here of political correctness gone mad (much though that is what the media would prefer to report).

It is right that a proportionate response should be taken when addressing needs in the workplace, but leaving people free in their own time to do as they wish, as long as they are not harming anyone, seems to us to be far more satisfactory in today’s multicultural society than imposing fines on women.

- Anna Power, Associate

http://tinyurl.com/3vxoclw

Riding Out The Storm Together?

2011-10-03T07:58:00.001-07:00

RIDING OUT THE STORM TOGETHER? MORE LIKE TRAMPLING OVER EMPLOYEES’ RIGHTS WITH A CARTHORSE

So here it is, the CONdem Government shows its true view of the average working person today by its blatant attempt to dilute workers’ rights in 2 major ways:

1. By bringing in court fees for Employment Tribunal cases meaning that in a typical case, it will cost a person £1,250 to issue Tribunal proceedings and have a hearing.

Now, bearing in mind the most common award for unfair dismissal is in the region of £4,500, a person who has just been dismissed is supposed from April 2013 to fork out £1,250 to be able to get justice. This really shows that access to justice for those on average or low wages is becoming a thing of the past, with only the rich (with savings...remember those?) able to afford to get justice from the Tribunal system. How many employees, who have been sacked unfairly, with all the stress of paying the rent or the mortgage, feeding the family and so on, will be able to stump up £1,250 within 3 months of being dismissed (because the three month time limit still applies)? Well, the CONdem Government’s own stats predict that at least 2,000 extra workers will be put off from bringing such a claim – I think it will in fact be many more. Fees will be even higher for cases where damages of more than £30,000 are sought, as is common in claims of discrimination.

2. They also plan to extend from April 2012 the period of qualifying service to gain protection from general unfair dismissal from one year to two years in order to make the workplace more ‘flexible’ – flexible of course only for the employer not the employee, who faces an extra year of uncertain employment, during which he or she may be able to be sacked unfairly at any time.

This shows what the CONdem Government’s ’business-friendly’ approach really means: weakening workers’ rights and making it harder for an average person to get justice against an employer which acts unlawfully or unfairly.

- David Sorensen, Partner

For further information, please contact our Employment Rights team on 0113 245 0733.

The impact of social networking on employment rights issues

2011-09-09T03:46:00.000-07:00

Acas has produced some Guidance Notes on Social Networking, offering tips on how to manage the impact of social networking on managing performance, recruitment, disciplinary and grievance issues.

There is also an excellent section on How to Draw up a Social Networking Policy, including practical tips and an explanation of the legal considerations involved.

For more information on workplace rights, please contact our Employment Rights team on 0113 245 0733.

Number of tribunal claims falls by 8% in 12 months

2011-09-05T00:30:00.000-07:00

The annual statistics for employment tribunals and the EAT for April 2010 to March 2011 have been published.

The statistics show that the amount of claims issued in the Tribunal have reduced by 8% in comparison to the 2010 figures. However this still means a total of 218,100 claims were received.

The statistics also reveal that:

* The number of single claims received has fallen 15% over the period in question
* The number of unfair dismissal and redundancy claims has fallen slightly
* Claims under the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 have almost tripled
* Age discrimination claims have risen 32%
* The median award of £12,697 for age discrimination claims is the highest of the discrimination strands, with all others around £5,000 and £6,000.

For further information, please contact our Employment Rights team on 0113 245 0733 or email info@morrishsolicitors.com

Rioting and Employment Rights

2011-08-23T02:51:00.000-07:00

The recent rioting across the UK has led to a number of queries in relation to people’s employment rights.

In relation to those who were involved in the rioting, what will happen about their employment if they have been arrested and subsequently prosecuted?

In addition, what happens to those who are unable to go to work because their workplaces were attacked in the riots?

As stated in the ACAS Code of Practice, “If an employee is charged with, or convicted of, a criminal offence, this is not normally in itself reason for disciplinary action”. Essentially, for the criminal conduct to be a disciplinary or dismissible offence it must affect the business in some way or undermine the employer’s confidence in the employee.

In terms of those involved in the rioting and looting, it is clear from the press reports that the Courts are dealing with those individuals very seriously and the majority are receiving custodial sentences. Much personal information has appeared in the press about those convicted, including in some instances the name of the employer.

Given the seriousness of the incidents, some employers may be inclined to summarily dismiss those individuals for gross misconduct for bringing the company into disrepute. Dismissal in these circumstances might be looked upon sympathetically by the Tribunals. But arguments will differ depending e.g. on the degree to which the employee has exposure at work to or dealings with the public (in the past cases have been decided against probation workers where their work brings them into contact with young offenders; criminal convictions for rioting are not consistent, it is said, with that sort of work).

If an employee is unable to attend work for personal circumstances, for example if their house has been damaged in the rioting, then that employee needs to be aware that they will not necessarily be entitled to be paid for any time that they have off, unless there is some provision in the contract which says so. If there is no contractual term then the employer can lawfully withhold pay until the employee returns to work.

However, if the employee is unable to work because the workplace is closed, then assuming the employee is otherwise ready and willing to work, then the employer must continue to pay their wages, unless there is an express contractual right that the employee can be laid off without pay. If there is such a contractual right, then those employees may be able to claim a guaranteed payment.

If the workplace has been completely destroyed then there is an argument that the employment contract has been frustrated because there has been an unforeseen event which makes the parties unable to perform the contract. If the contract has been frustrated then there has been no dismissal which means that the employee would be unable to claim unfair dismissal and they also would not be entitled to receive any notice.

Somewhat unusually, if there has been an unforeseen event which has led to the contract being frustrated, the employee may be entitled to receive a statutory redundancy payment under s.136(5) Employment Rights Act 1996, which specifies that such a situation is to be classed as a termination by the employer for redundancy pay purposes.

However, frustration is a difficult point for an employer to take: the situation may better be dealt with simply as a redundancy situation and the employee may be able to claim redundancy pay as well as still having an entitlement to notice.

If you would like to speak to us about bringing a claim or are interested in further information on employment rights, please contact our employment rights team on 0113 245 0733.

State landed with £3m Jarvis bill

2011-08-23T01:33:00.000-07:00

THE 1,200 staff who were sacked without warning by failing rail firm Jarvis are to be awarded more than £3m compensation - more than it would have cost to keep the company afloat.

The employees - of which 350 were based in York, 300 in Doncaster and 80 in Leeds - arrived for work on March 31 last year to be told they were unemployed. As a result the company failed to meet its statuary obligation to consult and give notice so the staff will be entitled to eight weeks compensation, capped at £380 per week. As Jarvis is no longer operating, it will be the Government which pays the bill and a tribunal court in Leeds yesterday heard that any staff who were unable to find work and therefore claimed Jobseeker's Allowance will have that, and any other relevant benefits, docked from their compensation.

The staff all worked for Jarvis Rail, Jarvis Fastline or at the York headquarters, Jarvis PLC.

Union bosses said it was disappointing that a number of workers, particularly those holding management positions, found employment swiftly and would therefore get more compensation than those who have been left jobless. It is also understood that administrators Deloitte went to Network Rail - owners of Britain's rail infrastructure - to request around £3m to keep the company going and retain staff but this was turned down.

Bill Rawcliffe, of Justice for Jarvis Workers and a member of the RMT Union, said: "This is only the first hurdle and the result is pretty much what was expected because employment legislation clearly states if you do not receive notice you are entitled to claim compensation.

"We think it is a disgrace that the compensation is being paid for by the taxpayer - that money should be paid by Network Rail which owed millions in work that had been already carried out by Jarvis workers.

"What is also difficult to take is compensation will have Jobseeker's Allowance and other benefits knocked off, but the management who did not have to claim benefits as they went round the revolving door and straight into other jobs will get the whole payout."

A Network Rail spokesman was unable to comment last night. About half of the organisation's budget is public money.

Unions claim some workers, who were also based in Glasgow, Newcastle, and Peterborough, were owed money for months before the company closed. Talks between Network Rail and the administrators officially finished in April 2010.

The fallout prompted a number of protest rallies, and Mr Rawcliffe claimed that workers from other parts of the UK have been carrying out the rail engineering work.

Unions were unable to say how many of the 1,200 had now found employment, but Mr Rawcliffe said those they knew of in work were now earning 30 per cent less in wages.

The tribunal yesterday heard that the company had no money at all to pay staff by March last year.

Claims against Jarvis will continue with at least 600 unfair dismissal claims likely to be made. Toni Haynes, of Morrish Solicitors, represented the members of the TSSA union at the tribunal.

"We are obviously pleased with the compensation offer - it is the maximum that we could have asked for," she said.

"Not all of the staff will receive all of that money, it will depend on their individual circumstances and what they have already received in other benefits.

"But what is clear is that the amount of money to be paid out of the public purse, is more than the £3m the administrators needed in the first place to keep the company afloat and these people in work."

- Reproduced with kind permission of The Yorkshire Post and Johnston Press

Employers need to grasp the benefits of flexible working!

2011-08-03T03:56:00.000-07:00

A recent report by Dan Leighton on Re-inventing the workplace has highlighted the significant benefits which Flexible working brings to the workplace. In addition it can aid the UK company growth.

Employers need to recognise huge demographic changes in the UK workforce. With an ageing population, more women in the workplace and a shift from manufacturing to service based industries has in recent years increased the demand on employers to introduce and offer more flexibility within the workplace. However, some employers still fail to see the benefits.

The fundamentals of flexible working assist in coping with the work/family life balance. It is essential for those companies who wish to attract and retain the best talent to implement such policies positively and promote them within the workplace. On a wider perspective, the benefits are numerous. They can address the social challenges of shared parenting and an ageing population that requires care. They can also reduce sickness absence and increase motivation within the workplace.

Employers need to grasp the benefits sooner rather than later!

Right to strike?

2011-06-15T05:33:00.000-07:00

I have written previously about the limited UK right to strike, and the political threat to change the voting threshold in ballots for industrial action.

Vince Cable now suggests that the Government will have to “get tough” on strike laws if the Union movement persists with the threat of widespread strikes in the Autumn.

We already have some of the most rigid anti-strike laws in the western world.

And the reality is that in recent years the number of days lost to industry in industrial action has been at a decades-long low. The Press love to report a good strike, but truth be told, there haven’t been many lately.

The mere threat of an increase in industrial action seems to have set the hares running. But what use are legal protections for strikers if, the moment serious action is threatened, the Government seeks to step in to prevent it happening?

I see no evidence of the Government taking a narrow view of the rights of individuals to protest in connection with the Arab Spring. And whilst of course there are differences between those revolutionary protests abroad and industrial discontent at home, the bottom line has to be that what we can respect abroad we must respect at home; and if a right to protest is not a right effectively to protest, then it is no right at all.

People do not naturally or quickly leap into industrial action. They lose pay for every day they do not work, and in the long run they risk discipline and/or dismissal. The veritable maze of booby traps that run as a thread through our anti-strike legislation have rendered it pretty difficult for Unions to organise industrial action at all. If, notwithstanding the best efforts of the legislators, and the natural reluctance of workers to lose money, a strike is lawfully and properly organised, or indeed a series of strikes, the Government should be looking not at how to prevent that protest, but at the policies that have given rise to it.

- Paul Scholey, Senior Partner, Morrish Solicitors LLP

“A modest proposal?”

2011-02-07T04:40:00.000-08:00

The Institute of Directors today tells us: help growth by removing employment rights. The right to request flexible working is cited as a culprit. Get rid of it, says IoD, and the money will come rolling in.

One has to wonder, is this dishonest politicking, or merely misinformed?

It’s interesting that the flexible working regime should be one of the areas singled out for attack. It is an easy target, because it smacks of political correctness (and IoD wouldn’t want to be seen attacking sex discrimination laws generally – though that undoubtedly is the agenda). It mainly protects women; it relates especially to childcare issues; it’s soft and touchy-feely and exactly the sort of thing that it’s easy to be cynical about. Bold brave employers need to be able to set their rotas and tough luck if your school hours don’t fit, because onwards and upwards for business and the devil take the hangers-on.

But there couldn’t, in fact, be a worse target for the IoD’s ire. Because our flexible working “rights” are a hopeless, toothless attempt at paying lip-service to proper flexibility.

The key is in the name: this is a right to request flexible working. Not a right to work flexibly. If your employer listens to your request, and can point to one of a (pretty exhaustive) list of reasons why it can’t be granted, that’s about the end of it (well, you get an appeal; the employer says no again: The End). Occasionally an employer gets it wrong, procedurally, and a Tribunal can award 8 weeks’ pay if the right buttons aren’t pushed – but as “rights” go, it’s about as useful as a chocolate fireguard.

So how is this right crippling growth in the UK? No-one has spelled that out, which is unsurprising, since I imagine that your average small/medium employer isn’t troubled by the regime on flexible working for more that what, a couple of hours a year?

Now, had it been suggested that we should simply abolish a system that doesn’t help anyone very much, I might at least have conceded that the argument was intellectually honest. But instead this is thrown in as part of a generalised attack on employment rights.

Why not go the whole hog? Abolish the laws on discrimination, unfair dismissal, whistleblowing, redundancy, holidays and the minimum wage. At least then there’s an honest argument that business might save money.

But it’s an argument that forgets that the best employers have cultures that protect, encourage and develop their workforces. You don’t get the best out of your employee who returns from maternity by insisting that she works 9 till 5. But you might get her loyalty, commitment and hard work by taking a sensible approach to a request for flexibility.

Employment rights aren’t just there for the benefit of workers. Employers who respect them respect their workforce, and profit as a result. That way might lie growth; the IoD’s approach is nothing more than a race to the bottom.

Paul Scholey

Operations Partner
Head of Employment Rights

Employers Charter? What about the workers?

2011-02-01T02:24:00.000-08:00

From Unite the Union

Government's charter for bad bosses

27 January 2011. Unite, Britain's biggest union, has branded a charter produced by the government for employers as a 'charter for bad bosses'.
BIS, the department for business and skills has produced an employers’ charter which the union believes gives employers a green light to bully and intimidate. It even encourages employers to sack staff.
Unite general secretary-elect, Len McCluskey, said: "This charter gives bad bosses a green light to bully and intimidate. It even encourages employers to sack staff. It's no coincidence that the employers' charter comes on the same day the government proposes to make it easier to fire workers, but harder for them to access justice in the courts. The government have declared open season on workers’ rights.
"In one of the gloomiest weeks for the economy this year we've heard nothing from the government about creating jobs. We only hear about the need for cuts and harassing people out of work.
"In reality this does employers no favours. Employers who misinterpret this advice will quickly find themselves in court and the guidance threatens to cause chaos across industry."
ENDS
Contact: Ciaran Naidoo 07768 931 315
The ‘charter’ can be accessed here: http://www.bis.gov.uk/assets/biscore/employment-matters/docs/e/11-680-employers-charter.pdf

Why the trade union voting standards are higher than general elections

2011-01-13T03:40:00.000-08:00

In today’s Daily Mail: “Currently, there is no minimum number of union members who must vote in a ballot for strike action, meaning a militant few can bring about industrial action.”

We see. That would be, then, exactly like our general elections, where a turnout of fewer than 50% of the population can elect a government to run the country for the next 5 years.

The “few” can only bring about anything if nobody else bothers voting. Typical Lazy Mail reporting.

How many politicians would be enjoying their expenses, we wonder, had each been obliged to win 50%+ of the votes of all their constituents?

Employment Tribunals – access to justice for workers

2011-01-05T05:34:00.000-08:00

Radio 4 today reported attacks by the CBI on the number of Tribunal cases, with employers allegedly forced to settle unmeritorious cases.

The business lobby would say that, of course.

The reality for working people is very different.

Unless entitled to help from a Union, many employees will have to represent themselves at Tribunal – employers choose to enlist lawyers (and increase their costs) because represented parties tend to fare better in Tribunal than unrepresented ones.

And there is hardly equality of arms: the employer continues to trade, whilst the employee is out of work – in the current climate, possibly for months. The employer’s legal costs are tax-deductible legal expenses; the employee is probably on benefits until new work is found. It is suggested an employer might have to pay £5000 to “buy off” the prospect of an expensive claim. Perspective: with average earnings about £26000p.a. are we really to be told that it’s unreasonable to pay 2.5 months’ salary to compensate someone who is out of work altogether?

And who is pursuing all these unmeritorious cases? The Tribunal’s own statistics show that over 50% of unfair dismissal cases dealt with by Tribunals last year resulted in a finding in the employee’s favour. If employers are so hard done by, despite getting it right as the CBI suggest, why are we seeing more cases than not succeed when heard by an ET? The CBI suggests that employers are forced to settle because of worries about costs; these figures suggest that in many cases, the settlement reflects some failure on the employer’s part to deal fairly with his employees.

Case numbers have increased – but largely because of a number of “multiple” claims (e.g. 1000s of local authority equal pay claims, and the 30000 or so airline claims that are “duplicates”, but protect employees’ positions regarding time limits) that distort the real picture. And since our individual rights have increased over the last 20 years, it would be strange if there weren’t more claims made, to enforce them. And in the middle of the largest global recession for decades, is it surprising that numbers might be up? One HR officer told Radio 4 that these troublesome new rights had been foisted on us by Europe. What ought we to get rid of, then? New rights in the last 15 years include rights not to be discriminated against because of disability or sexual orientation or religion; a right to a minimum wage; adoption leave; better maternity rights; and rights to decent paid holidays – shall we take these away? Politicians are quick to tell us what new rights we benefit from – yet a hue and cry issues when individuals want to exercise those same rights. Rights are worthless unless there is a way to enforce them.

Employment Tribunals provide essential access to justice for working people. Let’s not see a self-interested lobby undermine them.

Morrish Solicitors Employment Rights

Internships or free labour?

2010-08-31T02:49:00.000-07:00

We used to call it work experience in my day; but over recent years the humble “work experience” has become the American “internship”.

Internship loosely translates as “work for free”. In theory, that is fine. The idea behind it being that if you perform well, there is the chance a paid job as the end of that particular rainbow.

An interesting article on the BBC website which discusses how intern positions have become the preserve of those elite who have the fortune of someone else’s fortune to support them. They can just work for fun.
http://www.ippr.org/members/download.asp?f=%2Fecomm%2Ffiles%2FWhy+interns+need+a+fair+wage%2Epdf

However, an even more interesting slant on this subject is the impact of the national Minimum Wage Act on UK interns.

The Institute of Public Policy Research published a report on 2nd August 2010. See it at http://www.ippr.org/members/download.asp?f=%2Fecomm%2Ffiles%2FWhy+interns+need+a+fair+wage%2Epdf

The report points out that within the private sector anyone deemed to be working is entitled to be paid, at least, the national minimum wage.

The concept of interns, as mentioned above, came from across the Atlantic. In UK law they are not defined. Instead, therefore we must ask whether they would meet the definition of “worker” within the National Minimum Wage Act.

A worker is defined as someone who “has entered into or works under a contract of employment or any other contract...........whereby the individual undertakes to do or perform personally any work or services for another party to the contract......”

It would be impossible to give a categorical answer to the question of whether an intern is entitled to be paid national minimum wage or not. Each case would have to be judged upon its own facts in an employment tribunal. The reality is that any person (in particular someone fresh at university) who is hoping to secure their dream job with, for example a magazine, is going to take that magazine to a tribunal to test the point. Chances of them getting a job afterwards....erm.......nil.

The only way to resolve it is by legislation. Until then private companies can continue to exploit this free, and pretty endless, supply of free labour.

World Cup Fever

2010-06-22T06:28:00.000-07:00

We've released a fact sheet with useful hints for the World Cup. Please see our main website for more information.

Toni Haynes comments on the impact of Company liquidation

2010-05-25T02:44:00.000-07:00

I have recently successfully represented another employee in a claim for a protective award against an insolvent employer.

In this case the employer entered into liquidation with no warning to the 24 employees, who were all immediately made redundant. There was no indication to the employees that their jobs were at risk and it came as a surprise to most of them. As the employer was at this stage in liquidation they did not receive notice pay, redundancy pay or pay for the last two weeks of employment, those payments having to be made from the Redundancy Fund.

The employer also failed to consult about the redundancy situation. As there were more than 20 employees to be made redundant, the employer should have consulted for at least 30 days before the first dismissal took place. Again this legal requirement was ignored.

The Tribunal found that there was a complete disregard to comply with the law and awarded the maximum amount of compensation of 90 days pay for each employee who was made redundant.

Despite this finding, the employer will not have to pay the compensation as he is insolvent. The liquidators, also, will not find themselves liable. The payment will have to be made from the Redundancy Fund, in other words by the taxpayers.

This is a situation that we come across time and time again. The insolvency process does not occur overnight but despite the fact that a company knows that it will shortly go bust, the employees are kept in the dark. Often the job of dismissing the employees falls to the administrators/liquidators but they ignore the legal requirements as they will not be personally liable if there is a subsequent award of compensation made by the Tribunals.

So not only is the taxpayer responsible for paying the employees their redundancy pay, notice pay, holiday pay and other unpaid wages, but they then have to also fork out millions of pounds for the deliberate breach of the duty to consult by the directors of the company and the insolvency practitioners.

The new Con-Dem government is keen to convince us that they stand for fairness, a phrase we heard all too often in the run up to the election and that they are eager to cut costs. Maybe they should consider reviewing the laws regarding the liability of company directors and insolvency practitioners. I’m sure that if the directors/insolvency practitioners suddenly found that they were responsible for paying out 90 days pay to each employee who was made redundant, rather than the payment coming from the public purse, then they would be able to comply with the consultation requirements and not leave employees finding themselves without warning out of a job.

For further information, please contact our Employment Rights department on 0113 245 0733.

When is a contract NOT a contract?

2010-03-22T06:17:00.000-07:00

One of the first things you learn at Law School is the key principles of the law of contract. I can remember our tutor pointing out time and time again (we were slow learners) that we had failed to answer the questions correctly because we had not first asked whether there was a valid contract. Contracts, very basically, exist when one party offers something – a car, a book, a job – to another party who then accepts it. It is then pretty much accepted that the parties agree terms upon which the car will be sold or the job performed. Until recent times it was also pretty much accepted that one party could then not unilaterally vary the agreed terms. Terms could be changed, provided the other party agreed to them.

In Wandsworth London Borough Council v D’Silva [1998] IRLR 198 the principle was established that an employer could reserve the right unilaterally vary a contractual term. However, the implication was that a variation clause capable of having unreasonable results is likely to be subject to restrictive interpretation by the courts.

That, it seems to me, has been turned on its head following the decision of the Employment Appeal Tribunal in Bateman & Others v Asda Stores [2010] EWCA Civ 80.

In August 2007 some of Asda’s employees were working on a pay structure called “standard rate”. Asda wished to amend the contracts to bring them onto the more up-to-date structure known as the “top rate”. This would have brought them into line with their colleagues.

Extensive consultation followed. About 9,300 employees transferred voluntarily and about 8,700 transferred involuntarily. Asda maintained that they could change the contracts without agreement because the staff handbook stated that the Company:-

“reserve the right to review, revise, amend or replace the contents of this handbook, and introduce new policies from time to time reflecting the changing needs of the business”.

Following this, six test claimants brought claims for unlawful deductions form wages.

The Tribunal stated that the first issue for them was whether Asda needed the consent of the employees to make amendments having regard to the wording of the handbook.

The Tribunal held that the Handbook permitted Asda to make the changes and therefore it was not necessary for them to consider the remaining issues (implied/explicit consent & whether an unlawful deduction had been suffered).

The central question according to the Tribunal was whether the new regime could be introduced without obtaining consent of the employees.

The Claimants argued the following points: -

a) The power to vary was limited to non-contractual policies.

b) Any proposed variation to pay would require consent

c) Therefore, on the facts Asda did not do what was allowed by the variation clause.

d) The fact that Asda never acted expressly stated that they were exercising their right in accordance with that clause supported the Claimants’ interpretation of it.

The Tribunal accepted that Wandsworth established the principle that an employer can reserve the right to unilaterally vary a contractual term.

They also found that in certain cases a unilateral variation may break mutual trust and confidence, by being applied capriciously or unfairly; or by being introduced without consultation. However, it was found that those issues not relevant to the present case.

The tribunal held that consent was not required.

The Claimants appealed and put forward the following arguments: -

That the Tribunal had failed to apply the proper principles of construction set out in Investec Compensation Scheme Limited v West Bromwich Building Society [1990] 1 WLR 896 – the relevant meaning is the meaning that the document would convey to a reasonable person. They also referred the Employment Appeal Tribunal (EAT) to Autoclenz Ltd v Belcher [2009] EWCA Civ 1046 – proposition that sometimes it is necessary to consider whether the written contract represents the true intentions of the Parties. The argument was that the employees could not conceivably have intended to leave to the unilateral discretion of Asda the right to reduce pay, increase or decrease hours, cut holidays – without the need for consent or indeed notice. The submission was rejected on the basis that no evidence was put before the Tribunal to justify such a finding.

Had Asda intended the wording of the handbook to have the meaning found by the Tribunal then , in order to maintain its duty of trust and confidence, it should have brought home to the employees what that clause really meant. That submission was rejected because before the original Tribunal the Claimants had expressly conceded that there was no issue in respect of trust and confidence.
The final argument, and the one I find most compelling, was that the Tribunal was wrong to find the words in the handbook were “clear and unambiguous”. The power to review, revise, amend or replace did not apply to terms and conditions but merely permitted alterations to the contents of the handbook.

The EAT held that the relevant paragraph conferred two rights on Asda. They were to: -

(i) Review the contents of the handbook

(ii) Introduce new policies

“Contents” of the handbook included sections entitled “my pay”, “sick pay” and “my hours of work” all of which changed under the new regime.

The EAT concluded that the relevant wording of the handbook was clear as showing that Asda was entitled to review and to change the contracts of its employees without obtaining prior consent.

The decision appears to make it plain that a carefully worded clause in a staff handbook can enable an employer to make fundamental changes to the contract.

That to me ignores some of the special features of an employment contract. In particular a prospective employee is often handed a contract – terms are not usually negotiated. Indeed, often the staff handbook is provided once the job has been accepted. There is, in short, no equality of arms. When the job market is weighed heavily in favour of the employer this is even more so. Is it really fair to then allow an employer to effectively make any changes to the contract that he sees fit? I think not. We have supposedly moved away from the old concept of master and servant. With this decision I am not so convinced that we have.

Some people have suggested that the case is very specific to its facts. In particular, the issues that the claimants did not offer any evidence to support. However, it seems to me that when advising employees in a similar situation the advice has to be that there is a very real risk that a Tribunal will find that their employer can, without their consent, reduce their pay, increase or decrease their hours or otherwise make key changes to the terms and conditions of their employment.

For further information please contact our Employment Rights department on 0113 2450733.

The Right to Strike (2)

2010-03-16T07:52:00.000-07:00

I previously wrote a piece about the right to strike here: - http://morrishsolicitors.blogspot.com/2009/12/right-to-strike.html

It seemed appropriate to look at it again now that Lord Adonis and Gordon Brown have commented on the BA dispute.

I cannot help but wonder - What does an employee do if his or her employer announces that all benefits that the employee enjoyed, and agreed to when they signed the contract of employment, will vanish or be cut dramatically? Add into this a clear refusal by the employer to discuss their intentions and/or try to reach a compromise.

If negotiations fail an employee has two choices – accept the poorer terms, or leave. People often, mistakenly, take the view that the employee can claim constructive dismissal in such circumstances. That is not easy and an employer can argue that “business needs” make the changes and therefore the dismissal fair. The individual who takes that step is left with no job, no income and is taking their chances against a Company that can afford to pay huge sums of money to its lawyers to defend such a claim. Hardly a level playing field.

There is no “my employer can’t do that” or “that’s just not fair” law. (Maybe if there was strike action would not need to be used.) Instead, the only remedy is collective action.

But, what if the employees’ actions damage the “brand” and they ultimately end up out of work? Well, those employees will move to the competitors who are paying the lower rate that they are resisting. What do they have to lose?

I remain baffled as to why the employees and the Union have been turned into the “bad guys” in the dispute with BA. These are not employees seeking improved pay and conditions but instead are trying to prevent unilateral changes being forced through by the Company.

For further information, please contact our Employment Rights department on 0113 2450733.

How equal is age discrimination?

2010-01-25T03:05:00.001-08:00

I was looking back over past notes recently (I do really need to get out more!) when I came across a talk that I had delivered around the time that the Age Discrimination Regulations were introduced. Within that talk I discussed the fact that unlike the other forms of discrimination direct age discrimination could be objectively justified. I noted that this had been very unpopular due to concerns that it could enable employers to avoid liability for age discriminatory acts. It was hoped at the time that “objective justification” would be interpreted strictly.

Over three years on, it would seem that both our domestic courts and the European Court of Justice will, in fact, readily find objective justification thus enabling an employer to defend age discriminatory behaviour.

In MacCulloch v ICI Plc and Loxley v BAE Systems Limited the EAT held that the two contractual redundancy schemes did discriminate on the grounds of age, but that the discrimination could be objectively justified. In MacCulloch the EAT endorsed the tribunal’s view that rewarding loyalty and encouraging turnover of staff were capable of being legitimate aims that might be furthered by increased payments to older workers.

In Loxley the EAT accepted that excluding an employee from a redundancy scheme because he was entitled to benefits under the pension scheme, could also, potentially, be objectively justified.

In Pulham & Others v London Borough of Barking and Dagenham the EAT held that unlike in the case of sex discrimination and equal pay, age discrimination pay protection arrangements are always potentially justifiable.

In Europe the ECJ have upheld the German Government’s policy of barring anyone over the age of 30 from applying for the fire service (Wolf v Stadt Frankfurt am Main) The ECJ accepted that older people would be less likely to be physically capable of fighting fires.

The ECJ has also upheld the German Government’s age limit of 68 applied to dentists practicing in the national health service on the grounds that it enabled younger dentists to move into that sector (Petersen v Berfungasusschuss für Zahnärzte für den Beezirk Westfalen-Lippe).

It would seem that it is in fact fairly easy for an employer to provide a reason why discrimination should not be deemed unlawful. Whilst this does sometimes benefit employees, my concern is that what it in fact suggests is that age discrimination is perhaps not perceived to be as serious as other types of discrimination. The explanation for that could be that it is the only type of discrimination likely to affect us all at one stage or another.

I think that most people would also agree that there is nothing objectionable in principle about older, long-serving employees receiving a better deal in a redundancy situation.

The danger however, especially in the light of the two above ECJ cases, is that objective justification enables preconceived ideas about older people to perpetuate. Why should it be assumed that all older people (and I am talking anyone over 30) is not fit enough to be a fire fighter? Surely a non-discriminatory fitness test could resolve the issue. Why should older individuals be forced out of a job to allow a younger person to step in? How does that tally with our ageing population? The issue, I guess, is as always a question of balance. But at the moment it seems to me that the balance is not being successfully struck.
For further information, please contact our Employment Rights department on 0113 2450733

The Right to Strike

2009-12-17T03:13:00.000-08:00

Much of the press at the moment is preoccupied with the strike threatened by British Airways Staff. It came as no surprise to hear the standard comment in such situations. “They should just be grateful they have a job”. I am sure they are. In fact given the current economic conditions I am sure all those people who are working are grateful that they are.

However, that does not mean that employees should therefore allow their employer to treat them how they wish. High unemployment should not equal – allow yourself to be treated like a disposable asset. Indeed, historically had employees simply thought “I should just be grateful I have a job” the vast majority of the working population would be working day in day out in highly dangerous conditions for a pittance.

The right to take strike action is a fundamental right. It is only by collective action that employees can try to prevent employers pushing through changes that not only adversely affect their working conditions; but also, more often than not, the service that they provide to the customer.

Striking employees and the Unions supporting them are all too often seen as the villains of the piece. Contrary to what many press articles would have us believe most union officers (certainly the ones I have met) would rather negotiate than strike. Calling a workforce out to strike is often the last resort.

As the Joint Secretaries of Unite the Union have said:-

“Christmas travel on British Airways is being held hostage by a macho management which prefers imposition and confrontation, or even litigation, to negotiation.”

The threat of strike action becomes necessary if your employer is not willing to listen to you. It also makes sense, in order to try and avoid that strike action, to hit an employer where it hurts. Namely, arrange your collective action to take place at the most inconvenient and/or costly time for them. The aim, ultimately, is to try and change an employer’s deeply entrenched position, not cause massive inconvenience to the population. We should offer support to our fellow workers and remember that one entity could call a swift end to the action – and that is British Airways.
For further information, please contact Jayne Phillips in our Employment Rights department on 0113 2450733.

Jayne Phillips discusses the new redunancy laws on Yorkshire Post's podcast

2009-12-16T01:37:00.000-08:00

Click on the link to listen to Jayne Phillips, one of our Employment Rights partners, speaking on the Yorkshire Post podcast about the new redundancy laws.