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Oliver McCannn   


Employers Update - October 2011

Welcome to Employ! the monthly employment / HR newsletter which keeps you up to date with key developments.

In this edition we bring you up to date with government plans for employment legislation over the next 2 years some of which will be well received by Employers (for a change!) but other aspects not so well received.

As ever keep sending your HR questions to us for our Q&A section and if you wish to discuss any HR/Employment matter feel free to contact the employment team.

Oliver McCann - Partner and Head of Employment
Email: oliver.mccann@taylors.co.uk
Tel: 0844 8000 263

Leanne Eddleston - Employment Solicitor
Email: leanne.eddleston@taylors.co.uk
Tel: 0844 8000 263


In This Edition:

Employ! Email Updates

Employ! is Taylors FREE monthly employment law newsletter which keeps busy HR professionals up to date with developments in the fast-moving world of work. Sign up now to have Employ! sent to you via email each month.

Employment Solicitor Joins the Taylors Team

It is with great pleasure that we welcome Leanne Eddleston who has joined the Employment Team from Eversheds.

Leanne's appointment further strengthens our Employment team and is in line with the Taylors philosophy of delivering a city service to your doorstep without the city rates.

Employment Law and Tribunal Reform

October always brings some form of legislative changes or introductions but we were perhaps a little surprised when Employment Tribunal reforms shot to the top of the agenda at this month’s Tory party annual conference.

What do I need to know?
We still await the outcome of the consultation document “Resolving Workplace Disputes” which did outline a number of key proposals but we never expected the government to bring forward two of their key proposals both of which are intended to be good news for employers and to help boost economic growth.

The government has confirmed that from April 2012 the qualifying period of continuous employment to bring an unfair dismissal will rise from 1 year to 2 years. Further, from 2013 individuals who wish to bring claims through the Employment Tribunal will need to pay Tribunal fees, with an up front issue fee of around £250 and a listing fee (when the matter is listed for a hearing) of around £1000.

The intention is to reduce the number of unfair dismissal claims but there is doubt as to whether the changes will in fact have this effect.

The increase in the qualifying period will be good news for you as an employer but only if you retain robust procedures as to the reasons for dismissal and have a clear paper trail. If not then there is a risk that employees will allege that their dismissal is either discriminatory or for an automatically unfair reason that does not need a qualifying period i.e. whistle blowing or dismissals for asserting a statutory right (e.g. family leave). Indeed many commentators believe there will be a notable rise in such claims, and whilst the government has attempted to head off this risk by introducing tribunal fees to deter vexatious claims, the small print alludes to a waiver of fees for those claimants who do not have the means to meet them – most people dismissed will be out of a job at the outset and so could meet the fee waiver criteria easily.

Further, as many businesses have already reduced their workforce, the likelihood is that those left currently meet the 2 year qualifying period.

  • Other changes which have arisen from the government consultation on Modern Workplaces include:-
  • Extending the right to request flexible working to ALL employees, not just those with dependants
  • Removing the technical step by step flexible working request procedure and replacing it with a duty to consider requests “reasonably”
  • Allowing more than one flexible working request per year and allowing temporary changes, not just permanent ones
  • Introducing a new system of shared parental leave – 1st 18 weeks maternity leave, with the balance of 34 weeks being classed as parental leave which can be taken by mother or father and concurrently
  • Increasing paternity leave to 4 weeks
  • Amending the Working Time Regulations to bring them in line with European case law

Can you Retract a Dismissal Notice?

A recent case addressed this issue after an employer mistakenly sent notice to terminate employment whilst still negotiating with the employee to move her on to a self employed arrangement. After receiving the notice to terminate, the employee advised her employer that she did not agree to the proposed self employed agreement and that she treated her employment as being terminated. The Employer quickly tried to make amends without success.

What do I need to know?
The Court of Appeal has held that the retraction of a dismissal notice is effective only with the employee’s agreement. Failing this, a clear written notice of termination remains effective notwithstanding the employer has made a mistake or changed its mind!

So what should you do in these circumstances? If the employee is being deliberately difficult and angling at an unfair dismissal claim then the best course of action would be to write an open letter to the employee explaining that there has been a genuine misunderstanding and offering to re-instate the employee with immediate effect and with back pay where appropriate. If such an offer is refused, then at least you have an argument that the employee has unreasonably failed to mitigate her losses by refusing the offer made.

Of course the same principle set by this case applies vice versa to an employee who resigns and then changes their mind. The decision whether to allow the employee to retract a resignation is usually yours, subject to disability resignations – see the article on this in this months Employ!

Disability Resignations!

In this edition of Employ we discussed an employer’s inability to retract a dismissal notice without the employee’s agreement. Common sense would say that this principle applies equally to an employee who wants to retract their resignation and be reinstated? Not necessarily!

What do I need to know?
In a recent case a probationary police officer resigned from her employment. At the time of her resignation neither she nor the police force was aware of any health problems. However shortly after resignation the employee was diagnosed as suffering from depression. Accordingly two weeks after her resignation she asked to be reinstated explaining that her decision to resign was taken in haste due to her depression. Her request was refused and she was advised if she wished to rejoin she would have to reapply.

The employee complained to an Employment Tribunal that the Policy, Criterion or Practice (“PCP”) not to allow officers who have “retired” to be reinstated placed those with depression at a substantial disadvantage as their decision to leave was more likely to be on irrational grounds. She brought a claim that the refusal to reinstate was a failure to make a reasonable adjustment.

Surprisingly the claim was successful and upheld by the Employment Appeal Tribunal. Even more so because the individual was no longer an employee when the request to make a reasonable adjustment was made – the obligation to make reasonable adjustments being to remove a substantial disadvantage to keep a disabled employee in employment.

This case naturally gives cause for concern for employers as to when they may legitimately turn down a request to be reinstated on grounds that the decision to resign was clouded through ill health.

If you receive a resignation from an employee suffering from stress or depression it would be sensible to hold an “Exit Interview” with the employee within a week of the resignation in order to explore with the employee whether they have made a reasoned judgement – ensure they have the opportunity to bring a work colleague or even a family member with them. Any other resignation should be taken at face value and no action need to be taken unless an employee suggests they have made a mistake. Timing is everything – in this case, the employee made the request within two weeks of leaving.

Costly Adjustments – are They Reasonable?

A recent case has held that refusing to provide a deaf employee with English lipspeaker support was not a failure to make reasonable adjustments because the cost of providing such support was unreasonable.

What do I need to know?
The employee, employed by the Foreign & Commonwealth Office, had been offered and had accepted a promotion to a role in Kazakhstan. The FCO had provided her with English lipspeaker support at her previous role in Poland but the cost to provide this same support in her new role was substantially more (£230,00 in total) and the job offer was withdrawn.

It was held that Tribunals should make a judgment on the basis of what they consider “right and just” when considering whether there has been a failure to make reasonable adjustments. Cost is one of the key issues to be considered when determining whether or not an adjustment is reasonable but the costs must be weighed with the other factors, including the degree of benefit to the employee if the accommodation is made.

In this case it was held the cost of the adjustment was “unreasonable” and so the claim failed. The good news is that there appears to be a greater willingness in discrimination claims generally to take financial cost considerations as the sole factor for determining whether to make a reasonable adjustment.

Remember, however, that each case will be decided on its own facts and a detailed and careful analysis of possible adjustments must be undertaken before a decision is reached that it is not “reasonable”.

Listed Companies and Corporate Governance Changes!

The UK Corporate Governance Code sets out standards of good practice in relation to board leadership and effectiveness, remuneration, accountability and relations with shareholders.

What do I need to know?
All companies with Premium listing of equity shares in the UK are required under the Listing Rules to report on how they have applied the Code in their annual accounts and report. The current edition of the Code was published May 2010 and applies to the financial years beginning after June 2010.

The Financial Reporting Council (FRC) announced two changes to the Code to strengthen the principle on boardroom diversity. This will require listed companies to:

  • Report annually on their boardroom diversity, including gender, and on any measurable objectives that the board has set for implementing the policy and the progress it has made in achieving the objectives
  • Consider diversity of the board, including gender, when evaluating board effectiveness

Changes will apply for financial years 1st October 2012. The FRC strongly encourages all companies to voluntarily apply and report on these changes with immediate effect.

A Bit of Argie Bargie!

The recent Carlos Tevez and Manchester City affair highlights the challenges some employers face when dealing with difficult employees.

The multi million pound player seemingly refused to play as a substitute against Bayern Munich. Unsurprisingly this resulted in wide spread criticism and disgust, a view apparently aired by Man City boss Roberto Mancini publicly saying that Carlos Tevez was "finished".

Prior to this Carlos Tevez has made no secret of his desire to leave. So where do Man City stand as an "Employer"?

Tevez’s primary contractual obligation is to play football for Man City, a fundamental term which he refused to comply with. Ordinarily an employer would, and should, view this as a fundamental breach of contract, gross insubordination and/or a breakdown in mutual trust and confidence any of which could be grounds for summary dismissal – of course, only after following a reasonable investigation and fair disciplinary process.

The reality however is that Football is an industry where the players usually hold the cards given the fact that they are not merely employees but also commercial assets; Tevez is undoubtedly worth millions to Manchester City. As such dismissal was never really on the cards, instead Mancini deciding to impose a significant fine on the player – but what example does this really set for the rest of the squad, particularly where a player can afford the fine?

Further, Mancini’s public comments about being “finished” (an understandable reaction) exposed the Club to a situation where Tevez may have had grounds to walk away and claim constructive dismissal – an outcome which Tevez may have actually considered taking but for the impact on his professional reputation.

Although this affair is a million miles away from the realities of day to day business it nevertheless serves as a reminder of some of the difficulties employers can face when confronted with difficult employees in particular:]

  • Ensuring consistency of disciplinary treatment – have Manchester City now set a precedent and weakened their future position with other dissenting players? To treat other players differently may result in allegations of unfairness, victimisation or discrimination.
  • When faced with a difficult employee it can be hard not to publicly make adverse comments against the individual. However, as an employer you need to act carefully when responding to such behaviour to avoid making matters worse, keeping your options open and ensuring you hold the cards when deciding how to progress the matter.

These matters are never easy and when issues first start to develop it is critical that you take strategic legal advice to ensure you protect yourself and achieve the outcome you want.

Your Questions Answered

Q. We are currently recruiting for various positions. Is it okay to use Facebook or Twitter to get some additional information about candidates?

A. In short, it is not advisable to use social media as a way of checking-up on potential recruits.

The biggest risk that you face in doing so is being accused of discrimination. You are under a statutory duty not to discriminate against applicants on a number of grounds, including on the grounds of their sex, sexual orientation, age, disability, race, religion or belief. By using social media sites as a way of viewing information about a potential candidate, you are more likely to come across information relating to these characteristics. This could make it easier for a rejected candidate to argue that the recruitment process was not objective and that they have been discriminated against.

In addition, viewing and collecting online data about a candidate will constitute data processing for the purposes of the Data Protection Act. Therefore, in order to ensure that you do not fall foul of the data protection principles it is important that you have in place relevant measures to protect the information collected, and that you are transparent with regards what information is being collected and how it will be used.

ACAS has recently issued guidance on the use of social media in the workplace, including in respect of recruitment. You can access it at www.acas.org.uk.

Q. One of our employee’s wants to take additional paternity leave (i.e. in excess of the usual 2 weeks ordinary paternity leave). This is the first request we have received for statutory additional paternity leave and we are unsure as to whether he is eligible. With regards his circumstances, we understand that his wife does not work – she has been a stay-at-home mum since the birth of their previous children. Please advise.

A. The statutory paternity leave rules changed dramatically for those employees whose children were born or adopted from 3 April this year. Qualifying employees can now take up to 26 weeks of additional paternity leave (“APL”). Such leave cannot be taken until after the child is 20 weeks old, and must be taken by the child’s first birthday.

There are a number of requirements that need to be fulfilled before an employee is eligible to take APL. The employee must satisfy the usual criteria to be eligible for ordinary paternity leave and must remain employed until the week before the first week of APL.

In addition, the employee must provide two written declarations:
a. an “employee declaration” confirming that the purpose of the APL is to care for his child; and
b. the “mother’s declaration” to verify certain information about the child’s mother, including confirmation of the date that she intends to return to work (see below).

The employee must also give his at least 8 weeks’ notice of his intention to take APL.

Importantly, APL can only be taken by an employee if the child’s mother was entitled to statutory maternity leave, maternity pay or maternity allowance and only once she has returned to work. The rationale for this is that APL is designed to allow parents to share parental leave following the birth or adoption of a child – it is not designed to allow both employees to be absent from the workforce simultaneously. Therefore, in the circumstances that you have outlined, it does not appear that the child’s mother was entitled to any of the specified statutory maternity benefits (because she has been out of work for some time) nor that she will be returning to work. On this basis, your employee will not be eligible to take statutory APL

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