Posts Tagged ‘Employment Tribunal’

Employment Law Update – April 2017

Tuesday, May 2nd, 2017

Report from Work and Pensions Committee condemns bogus self-employment practices in the Gig Economy

The Work and Pensions Committee has published a report suggesting that the Government must stop ‘bogus’ self-employment practices, which are potentially creating an extra burden on the welfare state whilst also reducing tax contributions to HMRC.

As part of the investigation the Committee heard from representatives from some of the major players in the Gig Economy such as Uber, Amazon and Deliveroo, and also from some of the individuals working for them.

The Chair of the Committee Frank Field said “This inquiry has convinced me of the need to offer ‘worker’ status to the drivers who work with those companies as the default option…….This status would be a much fairer reflection of the work they undertake which seems to fall between what most of us would think of as ‘self-employed’ or ‘employed’.”

Some of the main findings of the Committee are: –

  1. Designating workers as self-employed because their contract offers none of the benefits of employment puts ‘cart before horse’. Companies propagate the myth of self-employment, one which frequently fails to stand up in Court.

 

  1. Where there are tax advantages to both workers and businesses in opting for a self-employed contractor arrangement, there is little to stand in the way.

 

  1. An assumption of the employment status of ‘worker’ by default rather than ‘self-employed’ by default, would protect both those workers and the public purse.

 

  1. The self-employed and employees receive almost equal access to services funded by national insurance, yet the self-employed contribute far less. The incoming Government should develop a roadmap to equalise employee and self-employed national insurance contributions.

 

  1. The Department of Work and Pensions needs to ensure that its resources reflect the positive contribution that self-employment can make to society and the economy. This may require an expansion of specialist support in job centres.

 

The Committee also acknowledged that self-employment can be genuinely flexible and rewarding for many although employees and workers can and do work flexibly and that the main motive for classing designated workers as self-employed by these businesses is profit. Essentially these businesses get all of the benefits whilst workers take on all of the risk and the state expected to pick up the tab.

The Committee has strongly suggested that ‘It is up to the Government to close the loopholes that are currently being exploited by these companies, as part of a necessary and wide ranging reform to the regulation of corporate behaviour.

The Government has already signalled its intention to tighten up the law in this area and we can expect new legislation in the event that a new conservative government is re-elected next month. This might also form part of some of the other political party’s election manifestos which are scheduled to be published imminently.

In the meantime, Uber has been granted leave to appeal last October’s employment tribunal first instance decision.

 

Employment Tribunal awards £2 to Claimant who was denied a companion at a disciplinary appeal hearing

In Gnahoua -v- Abellio London Limited, the employment tribunal held that the employer breached the Claimant’s right to be accompanied when it refused to allow his chosen companions to accompany him at a disciplinary appeal hearing.

The Claimant who was a bus driver was originally dismissed from his employment when he was caught looking at his iPad whilst driving.

As part of the appeal process the Claimant informed his former employer that he wished to be accompanied by 2 brothers who had formed the PTSC Trade Union of which the Claimant had become a member.

The employer however refused to allow the Claimant to be accompanied by these two brothers on the basis that it had previously banned both brothers from representing staff at its internal hearings. The employer’s reasons were that one of the brothers used threatening behaviour towards members of staff and that both brothers were dishonest.

Ultimately the Claimant attended the appeal hearing unaccompanied and without representation. The employer upheld its decision to dismiss the Claimant.

The employment tribunal accepted that the employer had technically breached the Claimant’s right to be accompanied at the appeal hearing.

However, the employment tribunal went on to award a nominal sum of £2 on the basis that the employer had strong grounds for being unhappy with the choice of companion.

This case serves as a useful reminder that employers should always allow employees the right to be accompanied at internal disciplinary and appeal hearings by either a work colleague or a trade union representative, and that they ought not to unreasonably refuse the choice of companion selected by an employee.

Please call Steven Eckett, our employment solicitor, on 020 7998 7777 for more information or email him at steven.eckett@bloomsbury-law.com.

EMPLOYMENT SERVICES

Employment Law Update – August 2016

Thursday, September 1st, 2016

Rise in women on maternity leave facing discrimination

A survey by Citizens Advice reports a 60% rise in women reporting that they have been the victim of discrimination at work when they take maternity leave. Poor practices from employers include reducing hours of work, placing staff on zero hour’s contracts, changing roles when returning to work and making their roles redundant. Citizens Advice believes that the introduction of fees in the employment tribunal, combined with the rise in zero hours contracts, agency work and multiple part-time jobs, makes employees more vulnerable to these types of discriminatory practice when it comes to maternity rights. The research also estimates that around 54,000 new mothers are losing their jobs across the UK every year which is twice the number compared to a similar survey in 2005. It also found that 10% of women were discouraged from attending ante-natal appointments by their employers, which of course is unlawful and a serious health and safety issue.

 

Deliveroo bans workers’ access to the Employment Tribunal

Independent Contractors at restaurant delivery firm Deliveroo are being told in their terms and conditions that they cannot issue legal proceedings to be recognised as an employee or a worker. One provision stipulates ‘You further warrant that neither you nor anyone acting on your behalf will present any claim in the employment tribunal or civil court in which it is contended that you are either an employee or a worker’ and that they must ‘indemnify and keep indemnified Deliveroo against costs (including legal costs) and expenses that it incurs.’

Fortunately these types of penalty clause are unenforceable and are not worth the paper that they are written on. They are designed to scare and discourage delivery drivers from following in the footsteps of staff at Uber who have brought proceedings in the employment tribunal in relation to their employment status.

 

Employer successfully enforces Restrictive Covenants against Former Employee

The High Court recently awarded damages of £30,000 and an injunction to a business after a former employee breached his restrictive covenants by poaching his former employer’s clients.

The former employee Mr Penfold was employed by Decorus as a sales account manager from 2012. He signed a contract of employment which included restrictive covenants that were too widely drafted. Decorus at a later stage introduced updated contracts of employment including narrower restrictive covenants with a shorter restricted period of 6 months which Mr Penfold signed. He had also received a pay-rise before the new contract was introduced following an appraisal.

Mr Penfold tried to argue that the pay-rise issued before he signed the new contract of employment could not be counted as consideration to bind him into the new restrictive covenants.

In contrast Docorus argued that the introduction of the new contract was part of a three-phase process, namely the appraisal, follow up actions for example the pay-rise and then the issuing of the new contract of employment with the revised restrictive covenants.

In January 2016 Mr Penfold resigned and set up his own business. He then attempted to poach the clients of Decourus by using his access to their purchase logs which contained highly confidential and commercially sensitive information. He also entered into an agreement with one of Decorus’s customers whilst still employed by them, to ensure that this client provided him with information about their dealings with Decorus so that he could undercut and compete against them.

The High Court held that when taken together the appraisal, pay-rise and new contract were all connected and were valid consideration and that Mr Penfold had breached his duty of fidelity to Decorus.

This case illustrates that it is important for Employers to set out clear restrictive covenants at the start of the employment relationship and that they need to regularly review their restrictive covenants when the employee is promoted to ensure that they are appropriate and protect the business. It is also important to introduce updated restrictive covenants at the time of any promotion and/or pay-rise and to make it clear that the promotion and/or pay-rise is conditional on the employee accepting the new restrictive covenants and signing to this effect.

(Decorus Limited v (1) Daniel Penfold (2) Procure Store Limited [2016] EWHC 1421 (QB))

 

Employee awarded £3,000 damages after Employer withdraws job offer

The Employment Tribunal has awarded a Claimant damages for breach of contract where he verbally accepted a job offer for the position of maintenance engineer made by a recruitment agency hired to act on its behalf, and where the employer subsequently withdrew the offer.

The Employment Tribunal held that the employer acting through its agency had verbally offered the job to the Employee, which he had then accepted and which created a contract of employment. This was even though the salary and start date had not been agreed.

It was also held that the employee was entitled to damages for breach of contract equivalent to one month’s salary in lieu of notice. This was on the basis that one month was a reasonable period of notice for the position.

This case illustrates that it is vital that employers are clear that they wish to make a job offer to candidates even verbally and to ensure that communication channels with any third parties for example recruitment agencies remain clear.

(McCann –v- Snozone Ltd)

 

Solicitor ordered to pay £20,000 after proposing marriage to employee

Asghar Ali – the owner of AA Solicitors based in Bolton carried out a campaign of sexual harassment against a young paralegal – Miss Majid. During the interview for the position he asked her to marry him and suggested that a bed could be brought into the office.

Miss Majid politely declined Mr Ali’s advances and shortly after he dismissed her citing the reason that he could no longer afford to employ her.

The Employment Judge awarded Miss Majid £14,000 for injury to feelings (the middle Vento band), £4,000 in aggravated damages and £2,111 in loss of earnings. The award for injury to feelings was also uplifted by 10%.

It is worrying that this is still happening in 2016 and no less in the legal profession, where such behaviour brings the profession into disrepute.

(AA Solicitors Ltd (T/A AA Solicitors) & Anor v Majid UKEAT/0217/15/JOJ)

Call Steven Eckett, our employment solicitor on 020 7998 7777 for more information or email him at steven.eckett@bloomsbury-law.com.

Employment Law Update – July 2016

Monday, August 1st, 2016

No changes to employment law says the Secretary of State for Brexit

The Secretary of State for Brexit– David Davis – has suggested that UK employment law will not be radically changed after the UK leaves the European Union.

He said in a blog for Conservative Home that ‘Britain has a relatively flexible workforce, and so long as the employment law environment stays reasonably stable it should not be a problem for businesses’. Mr Davis further added that ‘There is also a political, or perhaps sentimental, point. The great British industrial working classes voted overwhelmingly for Brexit. I am not at all attracted by the idea of rewarding them by cutting their rights’.

In the meantime we have no idea when Article 50 will be triggered or what will be negotiated in the interim period as a price for the UK to have access to the EU single market. This could for example include the retention of minimum employment law standards affecting TUPE and the Working Time Regulations. Currently everything appears to be uncertain and up in the air and the next couple of years are going to be interesting as Brexit is negotiated with our EU neighbours and implemented.

New Prime Minster promises worker representation on UK Boards

The UK’s new Prime Minister Theresa May in her opening speech as conservative party leader has promised that her government will serve the many and not the privileged few and was at the service of ordinary working people.

As part of that pledge Mrs May has also vowed to ensure that there is worker representation on the UK’s Boards of major companies as well as consumer representation. Her words have also pleased the Trades Union Congress where its General Secretary Frances O’Grady said that ‘Workers have a clear interest in the long-term success of their companies and deserve a bigger say’.

Currently some EU countries take worker representation seriously including Germany, Sweden and Denmark. It now look as though the UK will now follow.

New immigration laws on employing illegal workers come into effect

New laws came into effect on 12 July 2016 which imposes tougher penalties and sanctions for employing illegal workers which are designed to create a more hostile environment for undocumented migrants. The focus and impact will hit employers with heavy fines and imprisonment for those individuals who hire illegal workers.

Historically it has been an offence to knowingly employ a person who is not authorised to work in the UK and employers faced a penalty of £10,000 per illegal worker that they employed. This penalty increased to £20,000 as a result of the Immigration Act 2014, however from this month new tougher penalties come into effect.

The bench mark has now been lowered so that not only employers who knowingly employ illegal workers will be caught but also those who have ‘reasonable cause to believe that the employee is disqualified from employment by reason of the employee’s immigration status.

Any breaches of the new laws could result in a maximum period of imprisonment of up to five years for Directors and business owners.

Employees are also targeted in the new legislation where those found to be working illegally could face imprisonment of up to 51 weeks and/or a fine in England and Wales, and imprisonment of up to six months and/or a fine in Scotland and Northern Ireland. An illegal worker’s salary can now also be seized under the Proceeds of Crime Act 2002.

Immigration Officers also have new powers now to search an employer’s premises and to confiscate any evidence of illegal worker activity and offences.

There are also proposals to close premises for up to 48 hours where a company is found to have employed illegal workers but these have not yet been implemented.

It is strongly recommended that employers protect themselves by obtaining the employee’s original right to work documentation from the Home Office’s prescribed list before allowing a worker to commence employment and to question the validity of the document with the employee in person. Employers are also advised to keep clear copies of the documentation and to mark the date that the documents were checked and if possible to get this witnessed and verified.

There is also a new skills charge of £1,000 for employees who are sponsored to work in the UK and who come from outside the European Economic Area, which comes into effect in April 2017. These provisions may well be diluted or abolished once we have a timetable in place for Brexit.

Employment Tribunal Judgments can soon be viewed on-line

Her Majesty’s Courts and Tribunals Service has confirmed that future employment tribunal judgments will be made publicly available on-line from the autumn.

Their database will allow a search of all first instance decisions across the UK.

This will be a welcome development as the only way of accessing these decisions at the moment is to attend the Central Employment Tribunal offices at Bury St Edmunds for decisions made in England and Wales and Glasgow for Scottish decisions.

Call Steven Eckett on 020 7998 7777 for more information or email him at steven.eckett@bloomsbury-law.com.