August/September 2009
In 2005 the government announced a proposal giving fathers the right to share what is currently maternity leave with the mother of their child. This would extend their right to paternity leave from 2 weeks to 6 months.
Mothers can currently take 12 months maternity leave. Under the new proposals the mother could take the first 6 months with the father being able to take the last 6 months as leave once the mother has returned to work.
Presently mothers can receive Statutory Maternity Pay for the first 39 weeks of their maternity leave. The last 13 weeks are unpaid. If parents shared 12 months' leave then the mother would receive Statutory Maternity Pay for 6 months and the father would receive Statutory Paternity Pay for the next 3 months. The remainder of the leave period would remain unpaid.
The government originally planned to introduce the right this year but it has now been postponed to help employers during the recession. It is now expected that the right will not be introduced until 2010, being applicable to working parents whose children are due on or after 3rd April 2011.
The number of businesses affected by the change is expected to be small. Around 40,000 men would qualify for the extended leave but at the moment only 60% of eligible men take paternity leave. Predictions are that under 6% of eligible men will exercise the right to additional leave. That could affect just 1 in 137 businesses.
Although potentially increasing the administrative burden for employers, the government has been keen to give assurances that changes are to be introduced in such a way as to minimise the burden. There will be no overall increase in the amount of paid and unpaid leave that parents can take.
The Minister of Business has approved ACAS' revised Code of Practice relating to time off for trade union duties and activities. The Code is currently awaiting Parliament's approval and will come into effect as soon as this is received.
To assist with implementation of the new code within the workplace, ACAS has produced two new guides advising how to deal with time off for employee representatives.
The first guide covers how to manage time off for trade union representatives and the second deals with time off for non-union representatives.
Statutory guidance defines 'likely' to be construed as 'more probable than not' however, the House of Lords has recently ruled in SCA Packaging Limited v Boyle [2009] UKHL 37 that this is too restrictive a test.
The House of Lords upheld a finding by the Northern Ireland Court of Appeal that in the Disability Discrimination Act 1995 (DDA) 'likely' should be interpreted as 'could well happen'. Further guidance was given to explain that 'could well happen' is to mean the same as that there is a 'significant risk' of an event happening.
This judgment appears to increase the protection afforded by the DDA. It also suggests that the burden on Claimants who suffer from recurring or progressive conditions of having to demonstrate that it is more probable than not that they will become more ill, will be reduced.
On the 24th August 2009 the Equality and Human Rights Commission issued court proceedings against the BNP on the grounds that the BNP's constitution and membership criteria are in breach of discrimination laws.
Before issuing proceedings the Commission sent a letter of action to the BNP. It expressed its concerns in respect of the BNP's constitution and membership criteria, which only allows people of a particular ethnic group and of white skin colour to become members.
The Commission believes that such restrictions are contrary to the Race Relations Act 1976 and if the BNP's membership criteria do not comply with the discrimination laws then the BNP will continue to discriminate against potential or actual members. The BNP's response was that it would clarify the word 'white' but not change its criteria.
Following the Government's announcement in the 2009 Budget, the increase in the maximum amount of a week's pay used to calculate the statutory redundancy payment is set to increase.
As of 1 October 2009, the maximum amount of a week's pay is due to increase from £350 to £380 as the Government hopes to ease the plight of those made redundant. It is not anticipated that this figure will be reviewed again until February 2011.
In Mono Car Styling SA v Dervis Odemis & Others (Case C-12/08) the European Court of Justice gave a ruling on the scope of the collective redundancies directive 98/59.
Belgian legislation has very specific provisions on the right to enforce consultation on redundancy. Although employee representatives in a case in Belgian confirmed the information and consultation procedures under local law had been followed, 21 individual workers challenged this. The basic question was whether they had locus standi to pursue the claim. The court held that the rights to information and consultation to be found in the directive were "collective". As such, the fact that the workers' representatives were given the right to act, which was not limited, was sufficient to meet the rules of the directive. The limitations in Belgian law and the ability of individual workers to challenge the procedure properly carried out by collective representatives did not frustrate the useful effect of the directive, nor did the court find that the rule infringed the principal of effective judicial protection. The court went on to state that when national law does not fully comply with a directive, the courts are under obligations to interpret the directive as precluding national rules reducing the obligations on an employer below the minimum levels laid down by the directive. National courts, when interpreting domestic law are, however, to interpret that law in conformity with Community law and, insofar as is possible, interpret such rules in a way that achieves an outcome that is consistent with the objectives of the directive.
In Raffaello Viscino v Istituto Nazionale Della Previdenza Socile (IMPS) (Case C-59/08) the European Court considered a reference from the Italian courts relating to the protection of employees in the event of insolvency of their employer. So far as reimbursement of employee claims from the State after an insolvency is concerned, the Italian legislation set a limit to the amount that can be paid out in respect of the last 3 months' employment. There is also, under Italian law, a one year limitation period for claims against the guaranteed fund. The court was asked to rule on the legality of these matters under European law. The court examined the provisions on insolvency (Directive 80/987). It concluded that the provisions do not preclude national legislation which uses the employee's initial claim relating to pay merely as a basis of comparison for the determination of the benefit to be guaranteed. Nor is the setting of a limitation period precluded, but, having regard to the principal of effectiveness, the national court must examine whether such a provision is framed in a way which is rendered impossible, in practice, or excessively difficult for the individual, to exercise his/her rights recognised by community law.
Advocate General Bot has given his opinion in Seda Kucukdeveci v Swedex GmbH & Co KG (Case no. C-555/07).
In this case the German Labour Court (Bundesarbeitsgericht) questioned the compatibility of German national law setting notice periods for the termination of employment contracts under Directive 2000/78 establishing a general framework for equal treatment in employment and occupation. German national law increased the minimum notice period incrementally with the length of service but stated that periods of employment before the age of 25 were to be disregarded. The referring court asked whether the requirement to provide younger employees with only the basic period of notice could be justified by the need to provide flexibility within the workforce.
The Advocate General stated that the court should find that the directive must be interpreted to preclude national legislation which does not take into account employment periods carried out before the age of 25 when calculating the notice period. The Advocate General also stated that, even if the court were to consider that the measure pursued a legitimate aim of social policy such as flexibility in the workforce or employment policy, the German measure went beyond what was appropriate and necessary to achieve those goals.
In Ovidio Rodriguez Mayor and Others v The Estate in Abeyance of Rafael De Las Heras Davila and Sagrario De Las Heras Davila (Case no. C-323/08) the European Court considered a case from the Spanish courts concerning an unfair dismissal claim by employees against the heirs of their former employer. Their employer had died intestate and ceased trading. The legal heirs refused to inherit the estate. In these circumstances the claim for unfair dismissal was brought against the estate in abeyance and the Spanish Wages Guarantee Fund. Whilst Spanish legislation makes provision for the termination of an employment relationship caused by the death of an employer, it does not comply with the provisions of the community rules on collective redundancies (Directive 98/59), such as those on information and consultation. It merely provides for the payment of one month's salary. The Spanish courts asked the ECJ to rule on whether the Spanish legislation complied with the directive, the EU Charter of Fundamental Rights and the Community Charter of the Fundamental Social Rights of Workers and indeed the definition of "redundancy".
In his opinion, the Advocate General noted that the directive only provides protection for collective redundancies when the number of workers affected is 20 or more. He proceeded to address the interpretative provisions that are raised in relation to the meaning and scope of the definition of "redundancy". He concluded that the concept of redundancy does not include the situation where the employment relationship is terminated by the death of the employer and where this leads to the cessation of the businesses and activity and no provision is made in national law for the employer to be replaced and its obligations to be fulfilled.
This topical seminar brings you right up to date following the repeal of the statutory disputes procedure. Learn how to deal with grievance and discipline under the new regime and what the penalties are for non-observance of the brand new ACAS code of practice,
To make a booking, please e-mail Erin May at em@short-richardson-forth.co.uk
This seminar is free of charge
In the recent case of Hughes v Alan Dick & Co. Ltd [2009] EWCA Civ 937, the Court of Appeal has considered whether the tribunal had jurisdiction to consider a case of unfair dismissal.
The leading case in this area is the House of Lords decision in the case of Lawson v Serco [2006] UKHL 3. In the leading judgment in this case, Lord Hoffman cited only three examples of employee who will fall within the scope of the relevant legislation, namely the Employment Rights Act 1996. Those referred to were employees working in the UK, peripatetic employees whose base is the UK, and, in exceptional circumstances, expatriate employees.
The Claimant in this case, Mr Hughes, was employed to work in Nigeria, and worked there for the duration of his employment with the Respondent. Although the Claimant was employed by the Respondent, an English company, he was employed under a contract which named his employer as the Nigerian branch of the Respondent. However, the Claimant was domiciled in England and he was understood to be recruited here. During the course of his employment, the Claimant was paid in sterling directly into his UK bank account. The letter of dismissal also came from the UK.
The tribunal found the Claimant to be 'embedded' in a substantial organisation in Nigeria operated by a Nigerian subsidiary company and, accordingly, he was not entitled to claim unfair dismissal. The EAT upheld this approach.
On appeal, the Court of Appeal concluded that the employment judge had not misdirected itself and had not reached a conclusion inconsistent with the House of Lords' decision in Lawson v Serco. None of the factors outlined above, such as the fact that the Claimant was employed by a company based in England or that his dismissal came from the UK, was sufficient to give the employment tribunal jurisdiction. The Court of Appeal also dismissed as having no relevance the fact that the Claimant had no remedy under Nigerian law. The Claimant was considered to have a far greater connection with Nigeria than the UK and his appeal was therefore dismissed.
The case of Norton Tool Co. Ltd v Tewson [1972] ICR 501 established the principle that where a claimant has been unfairly dismissed, their earnings from a third party during their notice period need not be offset against the compensatory award.
In the recent case of Stuart Peters Ltd v Bell [2009] EWCA Civ 938, the Court of Appeal was required to determine whether this principle applied to employees who had been constructively dismissed.
The rationale behind the Norton Tool principle lies in the fact that good industrial practice requires an employer to give either notice or payment in lieu of notice. If the employee had been paid in lieu of notice at the time of dismissal, the employee would not have to make any repayment of earnings from further employment during that notice period. Accordingly, it was held that an employee who has been unfairly dismissed should not receive less than they would have done in accordance with good industrial practice.
Thus, it was argued on behalf of Mr Bell, who had been constructively dismissed, that the same principle should apply regardless of the form the dismissal takes. Lord Justice Elias, in the leading judgment in this case, when determining this question, considered what good industrial relations practice requires. His conclusion was that the practice differs between the two forms of dismissal. He highlighted that payments in lieu of notice will not ordinarily have been made at the time of the employee's resignation in response to an alleged repudiatory breach and thus the same considerations do not apply. Whilst he noted that this leads to differing levels of compensation, it was held that the Norton Tool principle should not be extended and it would have been illegitimate for the tribunals below to have done so.
The EAT has recently delivered its judgment in the case of Tim Arrow & Sons v Onley [2009] UKEAT 0527/08.
In this case, the Claimant, Mr Onley, had been employed as a painter by the Respondent, a partnership which comprised four members of the same family. Mr Onley was the only employee and was dismissed by letter in February 2008. The statutory dismissal procedures which applied at the time of the dismissal were not complied with, nor did Mr Onley receive notice pay, redundancy pay or accrued holiday pay. However, one week before the matter reached tribunal, Mr Onley was paid both his notice and redundancy pay.
Although the dismissal was automatically unfair for failure to follow the statutory procedures, the tribunal at first instance considered whether Mr Onley would have been dismissed if a fair procedure had been adopted. The tribunal found that Mr Onley should have been placed in a pool for selection with one of the partners, and in doing so, Mr Onley would not have been dismissed. A percentage uplift of 50% was applied to the compensation awarded to take into account of his employer's sheer disregard for the correct procedures. The Respondent was consequently ordered to pay compensation for unfair dismissal and failure to pay holiday pay amounting to approximately £24,000.
On appeal to the EAT, it was held that placing Mr Onley in a pool with one of the partners, an employer, was not a permissible step to have been taken by the tribunal. Taking this into account, the EAT found that Mr Onley's employment would only have lasted one further week had a fair procedure been followed and that the compensation should accordingly be adjusted.
Although the EAT agreed with the tribunal's rationale for setting the percentage uplift at the maximum permissible of 50%, the EAT was forced to take into account the payment made to Mr Onley in the week before the tribunal. As this payment included notice pay and redundancy pay, the EAT found that Mr Onley was therefore only entitled to one week's pay in respect of the additional week he would have stayed in employment had he been dismissed fairly and also his holiday pay. As the wording in the Employment Act 2002 referred to an increase of any 'award' made to an employee, the uplift applied only to this amount. Mr Onley's original award of compensation was reduced accordingly to a little over £1,000.
Although the relevant provisions of the Employment Act 2002 were repealed as of 6 April 2009, the current wording which replaced these provisions is notably similar. The Employment Act 2008 which amends the Trade Union and Labour Relations (Consolidation) Act 1992 allows for an increase of up to 25% to 'any award it makes' for unreasonable failure to follow the ACAS Code of Practice. The EAT's ruling in this regard is likely therefore to remain of relevance.
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