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Employment Law Update | March 2022

Welcome to the latest edition of our employment law update.

As always please don’t hesitate to contact James Austin if you have any questions arising from the news items below.

In the Courts

Was an employer liable for an injury caused by a practical joke at work?

This was considered by the Court of Appeal in Chell v Tarmac Cement and Lime Ltd. An employee of Tarmac had taken explosive pellets to work and hit them with a hammer close to Mr Chell’s ear. Mr Chell suffered a perforated ear drum, hearing loss and tinnitus. He claimed damages for personal injury arguing that Tarmac was vicariously liable for its employee’s actions.

The Court of Appeal found that Tarmac was not liable as:

  • the reason for the injuries was the explosive pellet which was not Tarmac’s equipment and not used in the employee’s work;
  • Tarmac did not authorise the employee’s behaviour, nor was he doing something Tarmac did authorise but in an unlawful manner;
  • The behaviour was not in the course of employment;
  • Whilst employees were expected not to engage in horseplay, it would be unreasonable and unrealistic to expect the employer to have in place a system to ensure they did not.

Despite this decision we strongly suggest that you make it clear to employees that horseplay is not allowed at work and take action if employees are found behaving in such a way, as there are similar cases where employers have been found liable.

How many years of holiday pay can a worker claim for if they have not been allowed to take any holiday leave?

In Smith v Pimlico Plumbers Ltd, Mr Smith sought payment of holiday pay for the entirety of the time he worked for Pimlico Plumbers having taken unpaid leave throughout as he had been (incorrectly) told that he was self-employed and had no right to paid leave.

The Court of Appeal held that where a worker has been denied the right to paid leave throughout their employment, the right accumulates from year to year, and crystallises on termination. In effect the worker’s holiday would be carried over from one holiday year to the next. This meant that when they came to bring a claim at the end of their engagement the claim was for a single payment, not for a series of deductions. The key point about defining it in this way is that the legislation which normally restricts workers to claiming up to two years of unpaid wages (the Deduction from Wages (Limitation) Regulations 2014) does not apply, so a worker can claim unpaid holiday for the entirely of their role.

It was also found that the worker doesn’t have to prove they have been denied paid leave. The burden is on the employer to show that it has "exercised all due diligence in order to enable the worker actually to take the paid annual leave to which [they are] entitled".

This is another warning for those businesses that engage people as self-employed contractors when there is a risk that they are actually either employees or workers. Whilst the decision only applies to the four weeks of holiday leave provided as a result of the Working Time Directive (EU legislation) being on the wrong end of a claim will still prove expensive.

If you’re not sure if you may be at risk contact us to talk it through.

What impact does the right of substitution have on whether someone is an employee/worker?

Another case in the seemingly endless line of cases surrounding the gig-economy; this time concerning DPD drivers.

Drivers entered into franchise agreements with DPD for parcel-delivery services. The drivers claimed that they were either workers or employees but DPD alleged that they were neither, relying on them having an ‘unfettered right of substitution’ under the franchise agreement. They were entitled to provide a substitute of their choosing, provided they supplied a copy of that substitute’s licence and ensured that the substitute completed an application form.

The EAT found that these requirements were in place merely in order to satisfy DPD that the relevant substitute was an appropriate driver. These requirements did not otherwise fetter the right of the franchisee to provide a substitute. As they had a genuine right of substitution, this was inconsistent with worker or employee status. The fact that many of the franchisees in practice only ever used cover drivers who were already themselves franchisees did not change this finding.

This case demonstrates the importance of the requirement for personal service when determining employee or worker status. Whilst the right to substitute will be tested and must be genuine, the fact that it genuinely exists, even if never in practice relied upon, is likely to mean that the arrangement is inconsistent with employee or worker status.

Can an employer spend longer than three months dealing with a flexible working request?

As most employers will be aware, whilst the strict timetable for dealing with flexible working requests no longer applies, there is nonetheless a ‘long-stop’ deadline of three months, within which a decision must be made and communicated to the employee, including any appeal. This deadline can only be extended by agreement between the parties.

In the recent case of Walsh v Network Rail Infrastructure Ltd, the Employment Appeal Tribunal has confirmed that an employee who agreed to attend an appeal hearing held outside of this three-month time limit had not agreed to an extension of time simply by virtue of their agreement to attend the meeting. In order for the decision-making period to be extended there must be an express agreement to this – an agreement only to attend an appeal hearing on a specific date did not amount to such an agreement.

This case serves as a useful reminder to employers dealing with flexible working requests that if they wish to extend the time limit in which to do so, they would be well advised to get an agreement from the employee in writing. It is also worth noting that the recent Government consultation on Making Flexible Working the Default has raised a number of queries on the current legislation including whether:

  1. the reasons for refusing a request remain fit for purpose;
  2. the right to request should become a ‘right to have’ flexible working arrangements; and
  3. whether the current process is appropriate or should be shortened so that employers could have as little as two weeks to deal with such a request.

It is therefore worth keeping an eye on any developments in this area and ensuring that your policies and procedures remain up to date.

What is a reasonable adjustment?

The Employment Appeal Tribunal has confirmed that the likelihood of a proposed adjustment benefiting an employee, and the extent to which the adjustment would benefit the employee, were relevant factors in assessing the reasonableness of the proposed adjustment.

In the case of Judd v Cabinet Office, the Tribunal found that the employer had not discriminated against an employee for withdrawing an offer of secondment to Montenegro, following advice received from an independent contractor who had been engaged to carry out a risk assessment. The contractor determined that the employee was ‘high risk’ due to her medical complaints which had led to two significant health issues the previous month, which had resulted in her needing to attend A&E. Her consultant also considered that she remained at risk of further episodes. Occupational health suggested that she was fit to travel provided some adjustments were made, but the contractor who carried out the risk assessment concluded that the recommendations of occupational health were insufficient to protect her health and safety.

The Employment Tribunal’s decision that the employer’s withdrawal of the offer of secondment was not discrimination was upheld by the Employment Appeal Tribunal. It found that an employer was not obliged to adopt any adjustment which had the prospect of alleviating any disadvantage and it was open to the tribunal in this case to have determined that the adjustments proposed were insufficient to protect the employee’s health, safety and wellbeing, having weighed up all the relevant factors.

This case will come as welcome news to employers and provide some comfort that there is a balancing exercise to be carried out in all cases in order to determine whether an adjustment is ‘reasonable’ in the particular circumstances of each case.

Can employees compare themselves to colleagues at other destinations for equal pay purposes?

An Employment Tribunal in the case of Abdar and others v Wm Morrison Supermarkets Plc and another has held that Morrisons’ retail workers were able to compare themselves with their colleagues in Morrisons’ distribution centres. The Tribunal found that there was a single source responsible for setting their terms of employment and that they were employed on common terms. They were therefore entitled to compare themselves to these colleagues for the purposes of the claim.

The next stage in proceedings is for the retail workers to demonstrate that the work they carry out is of ‘equal value’ to the work carried out by their distribution centre colleagues and this will be determined at a further hearing in due course.

When should claimants be allowed to bring their claim outside the normal time limit?

As readers will be aware, the time limit within which a discrimination claim must generally be raised with Acas is three months from the date of the act – or the last in a series of acts – complained of. The Tribunals can only extend this time limit where it is ‘just and equitable’ to do so.

In Wells Cathedral v Souter the Employment Appeal Tribunal confirmed that the factors to be considered when determining whether it is just and equitable to extend time in discrimination claims will be case-sensitive. There is no ‘one size fits all’ and each case must be weighed up on its own merits. The Tribunal must consider and weigh up all the relevant factors and determine what weight should be applied to the relevant circumstances of the case.

In this case, the Tribunal had taken into account the fact that the claimants had raised grievances within the relevant time limits as a relevant factor when deciding to extend time, finding that this fact meant that evidence had been preserved and therefore the potential loss of evidence arising from a delay did not apply in this case. The Respondents appealed to the EAT, arguing that the Tribunal had been wrong to rely on the fact that a grievance had been raised, meaning that evidence could be preserved.

The EAT held that there was no rule that the Tribunal, having carried out a balancing exercise of all relevant factors, must look elsewhere for sufficient reason to extend the time. The Tribunal was entitled to reach its conclusion that it was just and equitable to extend time, in all the circumstances of this case, and the EAT would not interfere with this decision. This is a useful reminder of the discretion held by the Tribunal when determining whether to extend time in discrimination claims, and that the EAT will be unlikely to interfere with such decisions.

In the Law

Can you claim sick pay back from the Government?

We’ve been asked this quite a lot over the last couple of years. The current position is that employers of less than 250 employees can recover up to two weeks’ Statutory Sick Pay (SSP) for any employees who are off work either because they’re:

  • suffering from COVID-19; or
  • self-isolating due to possibly having COVID-19.

The scheme applies for absences on or after 21 December 2021, including where the period of incapacity started before 21 December 2021. The scheme will end on 24 March 2022, which is the last date for claims to be submitted to HMRC.

It isn’t possible to recover SSP payments made where the absence is for a non-covid related reason.

Do you have to provide PPE to all workers or just employees?

The Personal Protective Equipment at Work (Amendment) Regulations 2022 will come into force on 6 April 2022. These state that where there is a health and safety risk employers have to provide suitable PPE to all workers not just employees.

In simple terms, someone may be found to be a “worker” if they agree to personally carry out work for someone else and that someone else is not their client/customer. The definition tends to apply where people regularly work for the same business but are not described as an employee and perhaps are engaged on a more casual basis than employees tend to be.

Contact us if you have people working for you who are not employees and you are not sure if you will be obliged to provide them with PPE.

In the News

What causes most workplace absence?

A report published by the Health and Safety Executive in December found that stress, anxiety and depression caused more than half of all work-related absence in 2021. Those most likely to be affected were women aged 25 to 34.

Whilst this trend had been increasing pre-pandemic, the pandemic and its effects have undoubtedly contributed to these statistics over the last year. This invariably leads to a significant level of cost and disruption for businesses and is a useful reminder to employers of the importance of looking after employees’ mental health.

Do you think there should be more disability workforce reporting?

The Government has launched a consultation on disability workforce reporting. This will run until 25 March 2022 and aims to gather information relating to:

Current reporting practices, and what works well.
The case for and against implementing a mandatory approach to reporting.
How a mandated approach to reporting, if adopted, might be implemented in practice.
If there are alternative approaches that could also be taken to enhance transparency and increase inclusive practices.

The Consultation seeks views of employers and disabled employees and the response is expected to be published by 17 June 2022.

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