Employment bulletin October 2014
This month we look at new rights for fathers and the latest case law on: overseas workers, the importance of itemised payslips and a Tribunal allegedly falling asleep on the job.
There is still time to book a place at our next Breakfast Briefing, where David Clay will discuss the challenges involved in managing employees who have a disability or are absent on long-term sick leave. To join us please read more.
From 1 October 2014, new employment rights apply which entitle expectant fathers, the partners (including same sex) of pregnant women and intended parents of a child in a surrogacy arrangement to take unpaid leave to accompany a pregnant woman at up to two ante-natal appointments. The right extends to all employees from day one of their employment, as well as to qualifying agency workers. Employers must allow up to 6.5 hours of time off for each appointment attended.
Employers are not entitled to ask for evidence of the appointment i.e. an appointment card; however, they may ask the employee to sign a declaration setting out the date and time of the appointment, his or her qualifying relationship with the pregnant woman or the expected child and confirming that the time off is to accompany a pregnant woman to an antenatal appointment made on medical advice. If an employee fails to provide a declaration when asked, the employer may refuse the request.
If a request is unreasonably refused (there is, unfortunately, no guidance on what might constitute a “reasonable” refusal and employers would be well advised to exercise caution in refusing such requests) an Employment Tribunal can award compensation calculated at double the employee’s hourly rate of pay for each of the hours that he or she would have taken off, had the request(s) been granted.
The new rights have been presented by the government as part of its effort to encourage shared responsibility for parenting. While the cost to employers is limited by the fact that leave is unpaid, many will be concerned about the lack of clarity on what might be reasonable grounds for refusing such a request. Moving forward, employers should ensure that line managers and HR personnel are fully aware of the new entitlement and that their policies and procedures are brought up to date.
For additional information and guidance, please see the Department for Business Innovation and Skills’ guide for employers (read more).
Employers with overseas offices will be all too aware of the challenges of managing HR and employment issues across multiple, often very different, legal jurisdictions. Where British companies employ individuals who work abroad, it is important for them to consider which legal system will govern the employment relationship. A recent Court of Appeal case provides timely confirmation of the general principle that the location of the work will govern whether British law applies, unless the employee can show sufficiently strong connections with Great Britain or British employment law.
Mr Dhunna was employed as a salesman by CreditSights Ltd (CSL), a British company based in London. The ultimate holding company of CSL was CreditSights Inc, based in New York. In 2008 Mr Dhunna relocated from London to Dubai in order to focus on increasing sales in Asia and Africa. On moving to Dubai, Mr Dhunna gave up all his European accounts. While he remained on the payroll of CSL and received assistance from London-based staff, Mr Dhunna did not report to London, was line managed from Delhi, and was paid in US dollars. In 2010 Mr Dhunna’s employment was terminated for alleged gross misconduct and he brought a claim for unfair dismissal in the UK Employment Tribunal. CSL argued that the Employment Tribunal did not have jurisdiction to hear his claim.
The Court of Appeal agreed with CSL. It stressed that ordinarily an employee working or based abroad at the time of their dismissal cannot bring a claim for unfair dismissal, unless they can show a sufficiently strong connection with Britain and British employment law. The Court found that Mr Dhunna was not representing the UK business while working in Dubai and that, taking into account all the circumstances, Mr Dhunna had failed to demonstrate a sufficiently strong connection with Britain. The Court roundly dismissed Mr Dhunna’s suggestion that, in determining whether there was a “sufficiently strong connection”, it should conduct a comparison to determine which jurisdiction had the “best” legal system.
Whilst employers will normally make every effort to ensure that payroll is processed correctly, there will inevitably be occasions where an overpayment to an employee is made. Employers may be able to subsequently claw back an overpayment but should be aware that all deductions must be properly itemised on the employee’s payslip.
A recent case before the Employment Appeal Tribunal (EAT) concerned Mr Ridge, an employee of the Land Registry who had exhausted his sick pay entitlement but continued to be intermittently absent from work. Where his absences could be processed before payslips were issued, his gross pay was reduced appropriately. However, where this information was not available in time, the employer made an adjustment to his pay for the following month. This adjustment was shown as a separate negative entry on his payslip.
Mr Ridge claimed that the adjustments amounted to deductions from wages and that his employer had failed to properly set out what these deductions related to. He also claimed that he should be awarded a sum in compensation equal to the value of all the deductions made.
The EAT held that the adjustments were deductions, that the payslips did not properly particularise those deductions, and that the employee was entitled to a declaration to this effect. The employer should have ensured that the reason for any deduction was clearly labelled on the relevant payslips. While including a brief note or abbreviation indicating recovering of an overpayment would have sufficed, simply setting out the deduction with a minus sign was not enough.
The EAT acknowledged that it had discretion to award compensation, but refused to do so in this instance. The deductions were apparent from the payslips and their purpose had been explained to Mr Ridge before he commenced proceedings. Given the particular circumstances, compensation was not appropriate.
Employers must ensure that payslips properly detail the amount of deductions made and what they relate to. If deductions are not identified properly then employers may be ordered to pay punitive damages equal to the amount of the deductions made. This can occur even where the employer is entitled to make deductions and the employee understands why the deductions have been made.
It goes without saying that members of an Employment Tribunal are expected to remain alert and to listen closely to the evidence that is presented. A recent case saw a Claimant challenge the Tribunal’s decision on the grounds that a lay member of the Tribunal panel was clearly having difficultly keeping his focus. The member, Mr Lowndes, was spotted regularly closing his eyes during the course of a three-week hearing. On one occasion, he was also seen to be drooling for about 15-20 seconds until prodded by the judge.
The Tribunal refused to grant a review of the decision, explaining that Mr Lowndes took medication for dry eyes and had to close his eyes periodically to prevent them from drying out. Mr Lowndes also took medication for a serious bladder condition. The tablets for the eye and bladder conditions were both yellow and green in colour. Mr Lowndes, who has colour-blindness, had taken the wrong tablet on one day and this had led to the drooling incident.
The Claimant, Miss Elys, appealed to the Employment Appeal Tribunal (EAT) asserting that Mr Lowndes had not seemed alert, that he had asked questions which did not appear to be relevant, and that his medication may have affected his thinking and decision-making.
The EAT dismissed Miss Elys’ appeal. It decided that an impartial observer who was properly informed about Mr Lowndes’ circumstances would not have thought there was an improper risk of inattention by the tribunal. It also noted that the brief episode of drooling, while regrettable, did not amount to a material procedural irregularity. Mr Lowndes had taken full notes, had asked questions which the other lay member and the judge thought were relevant, and had provided medical evidence of his conditions.
Challenges to a Tribunal’s conduct are very rare and the parties would be unfortunate to experience this sort of scenario. However, if a party has concerns about the conduct of a Tribunal member, these should be raised as soon as possible so that the situation can be clarified (and the costs of further litigation avoided).