News & Insights

Employment bulletin June 2014

Our June bulletin offers some advice to get you through the World Cup and Wimbledon, highlights changes needed to flexible working policies, and considers the effect of tribunal fees on claim numbers.

Has your office been gripped by World Cup Fever or Murray Mania?

As we all know, there’s a football tournament going on in Brazil and a bit of tennis to be played later in the month.  Major sporting occasions such as the FIFA World Cup and Wimbledon have the potential to lift spirits in the workplace, but if everyone wants the same time off to watch a crucial match, or if a Mexican wave of sickness spreads through the business the morning after a key game, employers may be less than enthusiastic.

On the up side, have you thought about whether to organise social, team-building or networking events centred on the World Cup or Wimbledon?  Most of the matches in the World Cup take place in the evening (UK time), so events could be arranged with minimum disruption where businesses keep regular office hours. The same is clearly not true of Wimbledon with most significant matches starting in the early afternoon so more planning may be required to organise events alongside these matches.

If your business employs shift-workers, it’s likely that many will want to avoid shifts which clash with England games or other significant matches.  Remember to be fair and consistent to non-football/tennis fans, England/Andy Murray fans, and fans of other teams/players when arranging shift patterns or granting temporary flexible working or holiday requests.  Treating certain groups of people less favourably than others could create resentment and even lead to costly discrimination claims.

If you have not already done so, now is a good time to remind workers that the company’s sickness absence and holiday policies will continue to apply as normal, and that any unauthorised absences during matches or after a night of celebrating (or drowning sorrows) will be dealt with in the same way as they usually would be.

Have you remembered to update your flexible working policy?

Just around the corner is the extension of the right to request flexible working to all employees with at least 26 weeks’ service.  Currently this right is only available to employees with caring responsibilities.  But from 30 June 2014 employees will not need to explain the reason for their request – they could simply want a day off to practice their golf swing.  As we mentioned in our April bulletin the rigid statutory procedure will no longer apply but employers should follow the new ACAS Code of Practice.  The Code remains in draft at the moment but the final version should be published shortly.  Points for employers to note:

Changes to look out for before the next election

As we reported in our April bulletin, this Spring has already seen a number of changes to employment law.  Early Conciliation is now mandatory and TUPE transfers may be more difficult to achieve quickly as employee liability information has to be provided at least 28 days before the transfer date.  Read more.

This month’s Queen’s Speech suggests further changes are on the way.  The government has used the occasion to announce that it will introduce a Small Business, Enterprise and Employment Bill which will:

  • crack down on employers who fail to pay the National Minimum Wage or abuse the use of zero hours contracts;
  • make childcare regulations more flexible to meet the needs of working families; 
  • claw back redundancy payments from highly paid public sector workers if they return to the same part of the public sector shortly after their redundancy; and
  • cut red tape to assist small businesses.

There is also an intention to tackle delays in employment tribunals.  At this stage there is not a lot of meat on the bone for employers to digest.  The government will be expected to flesh out the details over the coming months, so we will keep you updated.

In addition to getting to grips with these various changes, employers may also need to reconsider their approach to holiday pay.  The European Court of Justice (ECJ) has followed the Advocate General’s decision which we reported in February (read more).  Basically this means that where workers are paid commission as well as a basic salary, any holiday payments they receive must include a sum to reflect the commission that they would have had the opportunity to earn had they not been on holiday.  

The ECJ has left it up to each country to decide how the commission element of holiday pay should be calculated.  Suggestions include using the average commission earned by a worker over the previous 12 weeks or the previous year.  It is also uncertain whether employers could delay paying the commission element of holiday pay until a later date to reflect the normal period between a worker carrying out work and receiving commission.  It is hoped that the UK decision in this case will address these issues.

In the wake of the ECJ’s decision, some employees may now look to bring claims for unlawful deductions from wages, potentially stretching back to the introduction of the Working Time Regulations in 1998 if they have worked for the same employer since then.   Whether this will be possible will depend on whether the UK courts decide that they can interpret the Working Time Regulations to give effect to the ECJ’s decision or whether new laws will be required.

Employment Tribunal Fees – obstruction to justice?

We are now starting to see the effect of fees in the tribunal on the number of claims brought.  Since fees were introduced last July most claimants must pay up to £250 to issue a claim and up to £950 if the claim proceeds to a hearing (the level of fees depends on the type of claim brought).

Commentators who predicted that the fees would lead to a fall in claims have been proven right.  The Ministry of Justice (MoJ) has now published the statistics for October to December 2013 and for January to March 2014.  The statistics for October 2013 to December 2013 show a drop of about 63% in the number of single claims and a drop of 79% in the overall number of claims as compared with the same period for 2012.  When it published these figures the MoJ advised that they should be treated with ‘extreme caution’, that they were provisional and that they may be revised at a later date.  The MoJ also explained that there may be a delay in claims being entered into the system while remission applications are considered or fees paid.  

However, the statistics for January to March 2014 continue to show a large reduction in claims.  While the MoJ has not published a figure for the overall number of claims, the number of single claims was 59% less than the same period for 2013.  There is some uncertainty over the reliability of the January to March 2014 statistics after the MoJ quickly removed the initial set of figures it had published on its website and replaced them with a different set.  The figures also contain apparent anomalies such as a 629% increase in claims for sexual orientation discrimination and a 97% reduction in race discrimination claims as compared with the same period in 2013.

Claimants on low incomes can apply for fee remission, but the Government has revealed that only about a quarter of applications for remission made between July and December 2013 were successful.  If that trend continues the MoJ’s predictions for those who would qualify for remission will be seen as highly optimistic.  Unison will doubtless be making use of these statistics in their continued challenge to the legality of the fees.  They are arguing that fees are restricting access to justice and have a disproportionate impact on women.

Employers will welcome a reduction in tribunal claims, but should bear in mind that where a claimant is successful at a tribunal then they will almost certainly have to reimburse the claimant’s fees (read more from our April bulletin).

Protecting your business: can employers inspect employees’ home computers?

When an employer has evidence that a current or former employee has breached a key term of their employment contract, it may ask a court to grant an injunction to stop the employee from acting in a way that will damage its business – usually this involves issues such as returning documents, not using confidential information, not working for a competitor and not trying to poach former colleagues.  

The High Court has recently considered how far such an injunction may go in terms of accessing the former employees’ home computers to establish if they have taken confidential information.  The employer, Warm Zones, had reason to believe that two of its former employees had during their employment, copied its customer database and offered to sell or disclose its contents to a competitor.  Both employees had confidentiality clauses in their employment contracts.  Warm Zones applied for an injunction to allow it to inspect and copy information from the employees’ home computers to prevent its confidential information from being misused.  One of the former employees had brought an unfair dismissal claim and accused Warm Zones of fishing for information.

The Judge considered that there was strong evidence that the former employees had misused the confidential information.  The injunction was granted requiring the employees’ home computers to be inspected and imaged.  Safeguards were to be put in place to protect any privileged information or information belonging to third parties on the home computers.

Employees should remember that acting in a way which leads their employer reasonably to suspect that they have breached their obligations can have very far reaching and expensive consequences.

Constructive dismissal – employees beware

Employees are entitled to treat themselves dismissed if their employer acts in fundamental breach of contract, so called constructive dismissal.  An employee has the option either to forgive the employer’s behaviour and remain an employee or to walk out.  If the employee chooses to leave, he or she must promptly either leave immediately or give notice.

The EAT recently considered whether an employee can give more notice than required by his contract and yet retain the right to bring a claim for constructive dismissal.  The employee resigned following what he considered to be a highly unsatisfactory outcome to a grievance process.  He was required to give 3 months’ notice but he gave 7 months’ notice for financial reasons.  He was found to have forgiven his employer’s breach of contract and so lost the right to bring a claim for constructive dismissal.  The EAT confirmed that the tribunal has to consider the facts in each case and the reason why an employee gave long notice would be a relevant consideration (for example in one case a professor gave longer notice than required to avoid disruption to his students’ studies).