Employment Law Bulletin

Equality Act 2010

April 2010 saw the Equality Bill receive Royal Assent. The Equality Act 2010 is currently due to come into effect in October 2010 but the ultimate form it will take will inevitably depend upon the outcome of the General Election in May.

The full Act and the Government’s explanatory notes to accompany the Act have now been published by the Government.

Legislative changes in April 2010

1. The Employment Tribunal (Constitution and Rules of Procedure) (Amendment) Regulations 2010 have given power to employment tribunals to pass on information about public interest disclosures to relevant regulators if a claimant gives their consent. The power relates to all whistleblowing claims submitted from 6 April 2010 onwards.
   
   This change was introduced in response to concerns that some genuine allegations of malpractice were not being notified to, or investigated by, the regulators.
   
   A new ET1 claim form which was introduced on 6 April 2010 provides a tick box for Claimants, whose claim consists of or contains a protected disclosure, commonly referred to as a ‘whistleblowing claim’, to indicate whether they would like their protected disclosure to be brought to the attention of the relevant regulator.
   
   A concern amongst legal professionals, however, is that this could be used to by a party to increase their bargaining power in pre-settlement negotiations.
2. The Apprenticeship, Skills, Children and Learning Act 2009 introduces a new right to request time off to undertake study or training for employees with 26 weeks’ continuous employment. The purpose of any such study or training must be to improve the employee’s effectiveness in the employer’s business and the performance of the employer’s business.
   
   For the time being this right only applies to employees working for employers with 250 or more employees, but will extend to all employees from 6 April 2011.
3. The Social Security (Medical Evidence) and Statutory Sick Pay (Medical Evidence) (Amendment) Regulations 2010 introduces a new “Statement of Fitness for Work” which replaces the traditional sick note medical statements (Med 3 and Med 5).
   
   The key difference is that GPs are now able to advise people who are on sick leave for over 7 days whether they would be able to return to work earlier with some extra support from their employer.
   
   GPs will be able to consider the functional effects of their patient’s condition in order to indicate simple adjustments or adaptations that could aide their return to work. This will enable them to state that an employee “may be fit for work taking account of the following advice…”. The aim here is to encourage employers to initiate discussions with employees to consider what changes can be made to assist a return to work.
   
   Some aspects of the old system remain. The statements must still be completed by a doctor, although the Government has indicated that it may extend the right to issue the statements to other healthcare practitioners in the future. GPs will still be able to advise a patient that they are not fit for work. However, the statements will constitute advice from a GP to their patient which the patient can then use as evidence of their fitness for work, sick pay, and benefit purposes. The advice set out within them is not binding on employers.
   
   Government guidance for individuals, employers and healthcare professionals can be found on the Department for Work and Pensions website.

Genuine Belief in Climate Change Can Be a Philosophical Belief — Case settles

We re-visit the case of Grainger plc and others v Nicholson which we reported on in our November/December 2009 update.

In November 2009 the Employment Appeal Tribunal upheld the tribunal’s decision that an individual’s, in this case Mr Nicholson’s, belief in man-made climate change was capable of being a “philosophical belief” for the purposes of the Employment (Religion or Belief) Regulations 2003 (“the Regulations”).

This decision related to Mr Nicholson’s claim for discrimination on the grounds of religion or belief on the basis that he had “a strongly held philosophical belief about climate change and the environment”. A pre-hearing review was held to consider various issues, including whether Mr Nicholson’s belief was capable of being protected under the Regulations. The tribunal held that his belief gave rise to a “moral order” similar to most religions and was a “philosophical belief” for the purposes of the Regulations.

Grainger plc appealed this decision and the EAT dismissed its appeal. Mr Nicholson was therefore able to pursue his discrimination claim on this ground.

His case, which was on the eve of a 10 day final hearing, has reportedly been settled outside of the employment tribunal. It is reported that Mr Nicholson accepted £50,000 in full and final settlement of his claim.

Reasonable responses test reviewed

The application of the range of reasonable responses test has recently been reviewed by the Court of Appeal in Sarkar v West London Mental Health NHS Trust [2010] EWCA Civ 289 and the decision highlights important considerations for employers.

In determining whether a dismissal is fair or unfair, a tribunal is required to consider whether a dismissal was for one of the six potentially fair reasons and whether the employer acted reasonably in dismissing the employee for that reason. The ‘range of reasonable responses’ test was established by the EAT in the case of Iceland Frozen Foods Limited v Jones to assess whether the employer acted reasonably.

Dr Sarkar had been summarily dismissed and brought a claim for unfair dismissal. The dismissal occurred following allegations against Dr Sarkar of bullying and harassment by staff and colleagues. The allegations were investigated and thereafter disciplinary action was commenced. However, rather than adopting the formal disciplinary policy, the Trust used an internal procedure, ‘The Fair Blame Policy’ (FBP). The FBP was specifically designed for less serious acts of misconduct and accordingly a written warning was the most severe sanction that could be imposed. However, the FBP broke down and formal disciplinary process commenced. The disciplinary panel found the allegations proved and Dr Sarkar was dismissed for gross misconduct.

The tribunal held that conduct had been the reason for the dismissal but held that the decision to dismiss fell outside the range of reasonable responses available on the basis that the allegations of misconduct had been recognised by the Trust as being relatively minor in nature and could not, therefore, amount to gross misconduct.

The Trust appealed and the EAT overturned the tribunal’s decision, finding that the tribunal had substituted their own view for that of the Trust.

On appeal, the Court of Appeal has now held that “the ET [employment tribunal] were entitled to regard the agreed use of FBP as an indication of the Trust’s view that the misconduct alleged against Dr Sarkar was relatively minor and that it was prepared to deal with it under a procedure that could not result in his dismissal. In my judgment, the ET did not err in law in concluding that it was inconsistent of the Trust then to charge Dr Sarkar with, and find gross misconduct based on, the same matters to dismiss him”.

The case highlights the importance of applying appropriately and consistently both the disciplinary policy in place and the sanctions set out therein. Should departure from a policy or sanction be later considered necessary, this must be supported and clearly evidenced.

Referral of British Airways holiday pay case to the ECJ

The case of British Airways Plc v Williams has been referred to the European Court of Justice by the Supreme Court.

Background

Ms Williams is the lead claimant for some 2,750 pilots employed by British Airways. Under collective agreements incorporated within their contracts of employment they are entitled to two supplementary payments in addition to their basic salary (flying pay and time away from base allowance). However, their contracts do not specify how holiday is to be calculated. They were only paid basic pay during their periods of annual leave.

The pilots claimed that British Airways was in breach of regulation 4 of the Aviation Regulations and that the two abovementioned supplements should have been included in the calculation.

Legislation

Under European Community legislation workers have the right to paid annual leave under article 7 of the Working Time Directive (2003/88/EC). However, this does not specify how a worker’s pay while on annual leave should be calculated.

Under domestic legislation, through the Working Time Regulations (SI 1998/1833), workers are entitled to be paid holiday pay by reference to the average wage they have received over the previous 12 weeks (section 221 — 224 Employment Rights Act 1996 (“ERA 1996”)). However the Working Time Regulations expressly exclude certain workers in the aviation sector.

A separate Aviation Directive (2000/79/EC) also forms part of European Community legislation. This implements the provisions relating to paid annual leave for flight and cabin crew, which were formed following the creation of the Aviation Agreement on 22 March 2000 by the Association of European Airlines and a number of workers’ federations.

However, the Aviation Directive does not specify how workers’ pay, while they are on annual leave, is calculated.

Under domestic legislation this entitlement is provided by the Civil Aviation (Working) Time Regulations 2004 (SI 2004/756) (the Aviation Regulations). However, unlike the Working Time Regulations, these do not contain any detailed provisions which define the nature or amount of the payment to be made during annual leave or apply the ERA 1996.

This case

The Employment Tribunal considered whether paid leave for the purposes of the Aviation Regulations should be calculated in accordance with the Working Time Regulations, and if not how it should to be calculated. It decided that the formula used by the Working Time Regulations could apply equally well under the Civil Aviation Regulations despite these being silent on this point. It therefore awarded holiday pay on the basis argued by the Claimants, which included flying allowances.

British Airways appealed but the Employment Appeal Tribunal dismissed its appeal.

British Airways appealed the decision of the EAT and the case proceeded to the Court of Appeal. The Court of Appeal dismissed the claims, ruling that there had been no breach of the Aviation Regulations. It decided to view the absence, in the Aviation Regulations, of a formula to calculate the rate of pay during periods of leave, as a deliberate decision by Parliament which had chosen to leave it to the aviation industry to negotiate the point by by way of collective agreements.

The Claimants appealed to the House of Lords, which has now been replaced by the Supreme Court. The matter was heard by the Supreme Court on 24 and 25 February 2010 and judgment was given on 24 March 2010.

It was decided that the case raised questions of the interpretation of the relevant provisions of the Aviation Directive and the Working Time Directive which are materially in the same form. It concluded that such interpretation was dependant on the meaning of the phrase “paid annual leave” in the Aviation Regulations, interpreted in light of the Aviation Directive. It found that it could not determine the appeal until the questions surrounding this had been resoled. It has therefore referred the following questions to the European Court of Justice:

• Under the Working Time Regulations and the Aviation Agreement annexed to the Aviation Directive, to what extent, if any, does European law define or lay down any requirements as to the nature and/or level of the payments required to be made in respect of periods of paid annual leave and to what extent, if any, may Member States determine how such payments are to be calculated?
• Is it sufficient that, under national law and/or practice and/or collective agreements and/or contractual arrangements, the payment made enables and encourages the worker to take and to enjoy their annual leave, in the fullest sense of these words, their annual leave; and does not involve any sensible risk that the worker will not do so?
• Or, must the pay either correspond precisely with or be broadly comparable to the worker’s “normal” pay?
• If so, is the relevant measure or comparison (a) pay that the worker would have earned during the particular leave period if they had been working, instead of on leave, or (b) pay which they were earning during some other period, and if so what, period when they were working?
• How should “normal” or “comparable” pay be assessed where: (a) a worker’s remuneration is supplemented if and to the extent that they are engaged in a particular activity; (b) there is an annual or other limit on the extent to which or time during which the worker may engage in that activity and that limit has been already exceeded or almost exceeded at the time the annual leave is taken?

The Supreme Court has neither upheld or dismissed the Court of Appeal’s decision and therefore this remains binding for the time being.

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