Substitution Rights of Delivery Drivers Preclude Them from ‘Worker’ Status

The High Court has ruled in a guideline case that a group of food and drink delivery drivers who can substitute others to perform their roles are not ‘workers’. The decision spelt defeat for a trade union which had sought recognition in order to represent the drivers for collective bargaining purposes.

The union argued that the drivers, all of whom performed motorcycle deliveries for the same company, were providing their services personally and thus fell within the definition of ‘worker’ contained within Section 296(1) of the Trade Union and Labour Relations (Consolidation) Act 1992.

In rejecting the union’s application for recognition in respect of the drivers, however, the Central Arbitration Committee (CAC) found that their ability to substitute others to perform services for the company in their place was fatal to the claim. The right of substitution was genuine, unfettered and operated in practice. In the circumstances, it could not be said that the drivers undertook personally to perform any work, or provide any services, to the company.

In dismissing the union’s challenge to that decision, the Court rejected arguments that the refusal of recognition amounted to a breach of Article 11 of the European Convention on Human Rights, which enshrines everyone’s right to freedom of assembly and to form or join a trade union.

Although it was accepted that the term ‘worker’ embraces some self-employed persons, the Court upheld the CAC’s conclusion that the power of substitution meant that the drivers were not in an employment relationship with the company. Neither domestic nor Strasbourg case law supported the proposition that the right collectively to bargain extends beyond such a relationship. Article 11 was therefore not engaged.

The Firm’s Annual Christmas Party

Christmas TreeThe annual Christmas party gives employers the opportunity to thank members of staff for their contribution over the past year and is a chance for everyone to relax and enjoy the holiday season. However, it is easy to forget that an employer owes its employees certain obligations, even outside work, when the event has been organised by the employer, and that employees’ conduct during it should comply with normal standards and should not breach workplace equal treatment and anti-harassment policies. An employer may be held vicariously liable for the actions of employees at such functions as they are likely to be considered as having occurred ‘in the course of employment’. To defend such a claim, it is important to be able to show that all reasonable steps have been taken to prevent such acts, which includes making staff aware of the appropriate policies and providing adequate training regarding conduct.

In order to prevent what should be a happy occasion from leading to recriminations or worse, an employer should take certain basic steps. Here are some of the more important ones: 

  • When planning any work event, thought should be given to whether it will coincide with the dates of religious festivals;
  • Carry out a risk assessment – this should include the venue and, in particular, the possible risks associated with serving alcohol. Making sure employees can get home safely is important, so consider hiring transport or providing taxis solely for this purpose if necessary. Ensure soft drinks are provided as an alternative to alcoholic drinks and that individual dietary requirements are catered for;
  • Ensure that, if employees’ partners are invited, there is no discrimination with regard to who is included. Ensure also that reasonable adjustments are made to allow any disabled employee or partner to attend and that any employees absent on maternity leave or because of long-term sickness are included;
  • Where possible, make sure that the arrangements accommodate the requirements of employees of different religions;
  • Ensure that employees understand the difference between ‘banter’ and behaviour that could be considered to infringe the dignity of any person present. You may wish to appoint supervisors to oversee the event, to whom staff can report problems. If such behaviour occurs, act quickly to prevent a re-occurrence. Take prompt action if a complaint is received;
  • Make sure that employees who are expected to attend work the day after the function understand that absence through over-indulgence is likely to be regarded as a disciplinary rather than a medical matter; and
  • Make sure employees are aware that any illegal acts will not be tolerated.

The biggest problems that are likely to arise are that inappropriate behaviour may occur, especially if alcohol flows too freely, and that there may be conduct which members of a particular religious persuasion find objectionable.

Your firm’s contract of employment will probably deal with most or all of these issues. However, it is sensible to have a separate policy on what is expected of employees at workplace social events and to remind employees of its contents in advance of any function.

In a recent vicarious liability case, in which a claim was brought by an employee who was punched in the face by a colleague and suffered serious brain injury some time after a group of employees had left the firm’s Christmas party and adjourned to a nearby hotel, the Court of Appeal ruled that the employer could be held liable for serious injuries inflicted by a senior member of staff on one of the company’s employees during an argument about work matters some hours after the planned Christmas event had finished.

For advice on all matters to do with employee behaviour issues and contracts of employment, contact us.

Criminal Exception to Disability Protection Analysed in Guideline Case

Mental or physical conditions that give rise to a tendency to commit various criminal acts are excluded from the protection that normally applies to disabilities under the Equality Act 2010. An instructive case on point concerned a council worker who walked out of a shop without paying for goods when he was suffering from post-traumatic stress disorder (PTSD).

Shopping streetThe man was apprehended outside the shop having failed to pay for various items. He said that he had not been dishonest in that, as a consequence of his PTSD, he suffered from forgetfulness and memory loss. He had simply wandered out of the shop without remembering to pay. Following an internal disciplinary process, however, he was dismissed for gross misconduct.

It was common ground that his PTSD would normally be regarded as a disability. In rejecting his disability discrimination claim, however, an Employment Tribunal (ET) found that his conduct revealed a tendency to steal. His condition was thus excluded from being a protected disability by Regulation 4(1)(b) of the Equality Act 2010 (Disability) Regulations 2010.

In challenging that decision before the Employment Appeal Tribunal (EAT), the man, who had previously served 17 years as a police officer and had no criminal record, insisted that he was not a shoplifter and that the isolated incident could not form a reasonable basis for a finding that he had a tendency to steal.

Dismissing his appeal, however, the EAT noted that he had been stopped by security staff outside the shop and, after police were called, he had accepted a penalty notice. He had paid a £90 fine as an alternative to prosecution and had signed a statement in which he made an unequivocal admission of theft. The ET was entitled to find on the evidence that he had been dishonest and that the employer had established that the exclusion applied.

Bus Driver Unfairly Sacked After Random Drug Test Wins Substantial Damages

When it comes to workplace disciplinary proceedings, slavish following of rules is no replacement for common sense. In a case where the latter was sadly lacking, a bus driver who was sacked after failing a random drug test succeeded in unfair and wrongful dismissal claims and was awarded substantial damages.

Bus2After his saliva tested positive for cocaine, the driver was adamant that he had never taken drugs other than those prescribed to him by a GP. He explained that a great many students had been on his bus on the day of the test and that cocaine may have got into his saliva via bank note contamination.

As a diabetic, he had to test his blood sugar regularly, causing sore fingertips which he licked continuously. He commissioned independent tests and analysis of his hair follicles revealed no traces of cocaine. He was, however, dismissed for gross misconduct and that decision was upheld following two internal appeals.

After lawyers launched proceedings on his behalf, an Employment Tribunal (ET) noted his 21-year unblemished career as a bus driver. There was no suggestion that he was unreliable or that his performance was impaired by drugs. He handled cash frequently, but there was no question of money going missing. There was nothing to indicate that any safety issues had ever arisen in respect of his driving.

In refusing to take into account the hair follicle test results, the employer had acted with a closed mind in a manner that was illogical and grossly unfair. The amount of cocaine found in the saliva sample was very small and a further test should have been arranged. The issue of possible cross-contamination was never satisfactorily resolved.

In the circumstances, the ET was not satisfied that the saliva test results were accurate. Common sense had been surprisingly lacking from the disciplinary process and the driver’s dismissal fell outside the band of reasonable responses open to the employer. He was awarded a total of £37,639 in compensation.

Employers – How Reasonable Are Your Disciplinary Processes?

Workplace disciplinary proceedings are always tense and it is vital to remember that their reasonableness is likely to be examined in detail by Employment Tribunals (ETs) after the event. In a case on point, a carpenter who was sacked after being accused of describing gay people as his pet hate succeeded in unfair and wrongful dismissal claims.

The man enjoyed an unblemished disciplinary record during his 14 years working for a social housing provider. After a tenant complained that he had made homophobic comments, however, he was summarily dismissed for gross misconduct. His internal appeal was rejected but, after he contacted specialist solicitors, they launched proceedings on his behalf before an ET.

In upholding his claims, the ET noted that the tenant’s identity had been kept from him during the disciplinary process and and that neither of the managers who dealt with the matter had met her. There had been no attempt to look for inconsistencies in her complaint and the managers’ acceptance of her word over that of the carpenter was unreasonable in the circumstances.

In the light of glowing character references, including from a gay friend, the ET found it highly unlikely that he would have made the comments alleged. The tenant had a motive for embellishing her account and it was probable that she had done so. She had not sought his dismissal and sacking him fell outside the band of reasonable responses open to the employer. His treatment also amounted to a repudiatory breach of his employment contact. The amount of his compensation has yet to be assessed but is bound to be substantial.

Civil Servant Prevails in ‘Pensionable Earnings’ Test Case

If an employee goes the extra mile and works outside normal office hours, does the additional income received form part of his or her pensionable earnings? The Court of Appeal analysed that issue in boosting the redundancy compensation and pension entitlements of a civil servant who regularly toiled at weekends.

The IT specialist worked for HM Court Service (HMCS) under a contract which at first required him to work 36.25 hours a week. The contract made no provision for overtime. The pressure of work was such, however, that he agreed to work extra hours at weekends. His contract was amended to reflect that arrangement and he was paid for the additional hours worked.

After he was laid off, HMCS calculated his redundancy compensation and his future pension entitlements on the basis of the 36.25 hours originally specified in his contract. The additional pay he earned at weekends was left out of account. After lawyers launched proceedings on his behalf, however, a judge upheld their arguments that, on a true interpretation of the Principal Civil Service Pension Scheme, the pay he earned at weekends qualified as pensionable earnings.

In dismissing a challenge to that ruling brought by the Ministry of Justice and the Cabinet Office, the Court rejected arguments that only remuneration that the man received for hours precisely specified in his contract qualified as pensionable earnings. The amended contract required him to work a reasonable number of hours at weekends and imposed a reciprocal obligation on HMCS to pay him for those hours. When the man worked at weekends, he was working in accordance with his obligatory contractual working hours and was not undertaking overtime.

Public Sector Pensions – Disadvantaged Judges Triumph in ‘Ageism’ Test Case

In a test case of importance to all public sector employees, a tribunal has ruled that transitional provisions put in place to prepare the way for full adoption of a new judicial pension scheme fell foul of the ban on age discrimination.

The scheme was introduced in response to a report of the Public Services Pension Commission which recommended wholesale public sector pension reform. The scheme was considerably less valuable to its members than its predecessor had been, both in terms of benefits received and the tax treatment of such benefits.

The transitional arrangements gave full protection against such disadvantages to judges who were members of the earlier scheme prior to 1 April 2012 and who were born on or before 1 April 1957. However, judges born between that date and 1 September 1957 were only entitled to protection on a tapering basis and those born after 1 September 1960 received no protection at all.

In those circumstances, a group of judges, including some members of the High Court bench, who fell within the disadvantaged group launched Employment Tribunal (ET) proceedings against the Lord Chancellor and the Secretary of State for Justice, alleging age discrimination.

In ruling on the matter, the ET noted the need to maintain public sector pensions at affordable levels and that it was for the Government to determine policy objectives and the appropriate allocation of resources. However, in upholding the judges’ complaints, it found that the Government had neither established that the differential treatment was in pursuit of a legitimate aim nor that the discriminatory means adopted were objectively justified.

The ET noted that the disadvantaged group was defined by the age of those within it and that the Government had failed to advance any rational explanation for the discriminatory treatment. The pursuit of consistency in the approach to pension reform across the public sector was not capable of justifying what was a clear derogation from the principle of non-discrimination.

In ruling on the Government’s challenge to that ruling, the Employment Appeal Tribunal (EAT) found that, in concluding that the discriminatory treatment was not in pursuit of a legitimate aim, the ET had misunderstood or misapplied the facts of the case. In dismissing the appeal, however, the EAT ruled that the extremely severe impact of the transitional provisions on judges within the disadvantaged group far outweighed the public benefit of instituting pension reform consistently across the public sector. The unequal treatment of the affected judges was thus not a proportionate means of achieving a legitimate aim.

Employers Can Always Recruit the Best Candidate? Oh No, They Can’t!

At first blush, it might appear obvious that employers are entitled to take on the best candidate for a job. However, as one case concerning a highly qualified medical practice manager showed, immigration law requires that suitable, EU-resident, candidates must be preferred to those from overseas.

The case concerned an Indian national with a first-class degree and an MBA who was recruited as the practice’s business development manager. The practice, which praised her excellent presentation, enthusiasm and great ideas, selected her from a list of 40 candidates. However, following an investigation, the UK visas and immigration section of the Home Office was not satisfied that a genuine effort had been made to recruit an EU resident instead of her and the practice was refused a licence to sponsor overseas workers entering the UK.

In ruling on the practice’s judicial review challenge to that decision, the High Court identified a number of flaws in the Home Office’s approach. The recruitment exercise had not been a charade, the post had been properly advertised, interviews had been carried out and the practice had been entitled to stipulate that the successful candidate should have an MBA qualification.

In rejecting the practice’s case, however, the Court noted that the effect of the residential labour market test applied by the Home Office is that a worker who is settled within the EU, and who is suitable for an advertised post, should be recruited in preference to a non-settled worker, even if the latter is considered to be the better candidate.

It appeared that, on receipt of 40 applications, the practice had proceeded to create a shortlist of five. There was nothing in principle objectionable about that but, having found that the overseas worker was the best, indeed the only suitable, candidate amongst the top five, the practice was not entitled to move directly to appoint her without considering the suitability of settled workers who had not been shortlisted. In those circumstances, the Home Office’s view that the practice had not made a genuine attempt to recruit from the residential labour market was not irrational.

The Government Responds to the Taylor Review of Employment Practices

In July 2017, Matthew Taylor, Chief Executive of the Royal Society for the Encouragement of Arts, Manufactures and Commerce and a former policy chief under Tony Blair, issued his report, commissioned by the Government, on how employment practices need to change in order to keep pace with modern business needs.

The Review, entitled ‘Good Work’, considered a range of issues, including the implications of new forms of work, the rise of digital platforms and the impact of new working models on employee and worker rights, responsibilities, freedoms and obligations. 

The Government has now published its response to the Review, setting out a plan of action for taking forward the recommendations, and launched four consultations on key areas covered. These are:

Former LLP Member Strikes Important Blow in Whistleblowing Case

In an important decision for limited liability partnerships, the former managing partner of a law firm who claimed that he was persecuted for whistleblowing had his hopes of winning £3.4 million in compensation boosted by the Court of Appeal.

The man had prepared a report after the firm’s board received a complaint of bullying against its senior partner. Before he could submit it, however, his resignation from his positions as managing partner and compliance officer was demanded. The board subsequently voted to remove him from those posts.

The man’s response was to give one month’s notice of his departure on the basis that the firm, a limited liability partnership, had repudiated his membership agreement. He said that the firm’s conduct towards him had rendered his continued membership intolerable. The firm, however, refused to accept that it was in repudiatory breach and informed him that he was expected to return to work. He did not do so and was ultimately expelled from the firm.

He lodged a complaint with an Employment Tribunal (ET) under the Employment Rights Act 1996, claiming that his membership had been constructively terminated and that he had been subjected to detriment as a result of making a protected disclosure. Following a preliminary hearing, the ET struck out that part of his claim that related to the termination of his membership and losses – primarily loss of earnings – that were said to have arisen from that termination.

That ruling was, however, subsequently overturned by the Employment Appeal Tribunal (EAT), enabling him to proceed with his claim in respect of post-termination losses. That was despite the man’s acceptance before the EAT that his claim that his membership of the firm had been terminated by his acceptance of an alleged repudiatory breach had been appropriately struck out.

In dismissing the firm’s challenge to the EAT’s ruling, the Court found that the man could claim compensation for post-termination losses even if he had been lawfully expelled as a member, provided that such losses were attributable to the earlier unlawful detrimental treatment. If all the facts were assumed to be true, in the man’s favour, his claim in respect of post-termination losses should not have been struck out.