With dubious expense claims hitting the headlines recently, a brief review of how this type of situation is regarded by Employment Tribunals may help to provide some useful context for the current media furore.

In the case of Brick Services Limited v Thompson, an employee was accused of submitting a false expenses claim and was subsequently dismissed. According to the employee, he had a hotel receptionist add £27 to a receipt to cover drinks which he had bought personally, but which in his opinion were a legitimate business expense.

At the Employment Tribunal, it was established that for some time the company had been putting pressure on the employee to agree to less favourable terms and conditions of employment, which the employee had continually refused to do.

The Tribunal found that the employer had leapt at the chance to dismiss Mr Thompson, and had not performed a full and impartial investigation into the matter as they should have done. Hence the Tribunal ruled that the real reason behind the dismissal was the refusal to agree to the new terms and conditions and not the false expenses claim, and that the dismissal was therefore unfair.

Earlier this year, the case of East Lancashire Coach Builders v Hilton provided a further insight into the way in which Employment Tribunals treat disputed expenses claims in relation to unfair dismissal.

Mr Hilton was dismissed for gross misconduct after he took his wife with him on a business trip to Mexico and claimed her fare as well as his own on expenses.

However, on closer examination there again proved to be more to the case. At the time of the incident, three directors of the company were negotiating a management buy-out of the business. Mr Hilton was not included in the negotiations, and, while there was no suggestion that they wanted to dismiss him, it would have been in their interest for him to step down as Joint Managing Director.

As Mr Hilton had a three-year rolling contract and it would have been very costly for the company to break the contract, the Tribunal concluded that the real reason behind his dismissal was not his misconduct, but rather the expediency of the matter given the buy-out situation and his relationship with the other Directors.

Both these cases demonstrate that Tribunals are willing to look behind the apparent reasons for dismissals in expenses cases and establish the real reasons behind such actions if it is appropriate to the case.

Employers who find themselves in this kind of situation should ensure that a thorough and comprehensive investigation into the incident is carried out so that, should the need arise, they can later justify the dismissal and provide firm and objective reasons for it.

Technorati Tags: Employment Law, Employment Tribunal, Expense Claims

In the recent Employment Appeal Tribunal (EAT) case of Joao v Mesh Computers Plc, an important point of procedure was highlighted which sheds more light on the discretionary powers of Employment Tribunals.

Mr Joao brought a claim of racial discrimination against his employer, alleging that the reason he had not been moved to his preferred area of work within the company for almost two years when he believed the transfer could have taken place far sooner was because of his race.

When he was later moved back to his original department, Mr Joao’s strong disagreement with this move eventually led to a disciplinary hearing and Mr Joao was dismissed. Acting in person, Mr Joao submitted an ET1 document which set out the entire chain of events and sought compensation for, among other things, “loss of employment”.

However, in the box on the form which asked if the claim was about unfair dismissal he ticked “no”, and stated elsewhere on the form that his claim was about “unjustified demotion”. Despite this, the Employment Tribunal gave the complaint the classification “UDL”, the code for unfair dismissal, and Mesh’s legal representatives had issued their ET3 on this basis.

At the original Employment Tribunal, the court attempted to establish the facts of the claim and untangle the confusion that had arisen. It concluded that the claim was not one of unfair dismissal, and refused Mr Joao permission to amend his claim to include such a complaint as he would be out of time, and the amendment would entail a postponement of the case, with all the necessary costs that would incur.

Mr Joao appealed against this decision to the EAT, and won.

The EAT found that the original Tribunal had fundamentally misread the situation. Mr Joao did not need to resubmit an entirely new case to have his unfair dismissal claim heard - the facts had already been pleaded and the evidence was before the court, so all that was called for was for the case to be “relabelled” as an unfair dismissal case. This was within the court’s discretionary powers given the circumstances.

Cox J stated: “A degree of caution is required in assessing a late application to amend in such circumstances, in particular when, until the first day of the hearing, both the Employment Tribunal and [Mesh] had proceeded on the basis that [Mr Joao's] complaints did include the claim which he sought formally to add by way of amendment. We consider that insufficient regard was paid to these factors.”

Accordingly, the amendment was allowed, and the case was remitted for a fresh hearing.

Technorati Tags: Employment Appeal Tribunal, Racial Discrimination, Relabeling Case, Unfair Dismissal

According to drug charity Release, there has been a significant increase in the numbers of employees being subjected to drug testing by their employers, and that more workers are being dismissed from their jobs as a direct result.

Many employers now carry out random drug tests on their employees, particularly in areas where health and safety are of paramount concern. Any employer who wishes to put a drug testing scheme into effect should first have a clear policy in place which sets out the circumstances in which they can ask an employee to take a test and also the implications of a refusal to comply.

Employers are not legally required to give their employees notice if a drug test is to be carried out. However, if the test is going to be carried out at short notice or with no notice, it should be made clear in the employer’s policy. This will prevent the employee from subsequently claiming that they were unaware that such a test could be required of them.

If a drug test on an employee comes back positive for illegal substances, the employer may be in a position to dismiss them.

From past cases, the prevailing attitude of the Employment Tribunal seems to be that drug use away from the workplace is only a justification for dismissal if it impacts on the employee’s performance or negatively affects the employer’s reputation or business. This is seldom clear-cut, however: in one case, an Employment Tribunal found that the dismissal of a teacher who mainly taught adults for possessing cannabis was unfair, while a similar case involving a forklift truck driver was found to be fair.

While employers cannot force workers to submit to drug testing, refusal to co-operate could be grounds for dismissal. Not only could it be argued that non-compliance implies guilt, but, if testing is explicitly mentioned in their contract, refusal to take a test could constitute breach of contract.

Random drug tests must be carried out in a fair and impartial manner if an employer is to avoid future discrimination claims. If, for example, an employer appears to be targeting younger employees for testing, they may be leaving themselves open to claims of age discrimination. All tests should be recorded and monitored so that employers can show that their procedures are reasonable and transparent.

For public bodies, Article 8 of the Human Rights Act - the right to privacy in one’s private and family life - must also be taken into consideration. While both the Employment Tribunal and the Employment Appeal Tribunal are careful to recognise this right, when the issue concerns the consumption of illegal substances and the health and safety of others an employee is unlikely to be able to use this as a defence.

Technorati Tags: Dismissing Employees, Employee Drug Testing, Gross Misconduct

Last month the Court of Appeal handed down its unanimous decision in the case of Baker v Quantum Clothing Group and others, also known as the Nottinghamshire and Derbyshire Deafness Litigation. Other than the implications of the judgement itself, the case is notable because an application was made by the employers that the court should recuse itself on the grounds that one of the judges was in a position of inherent bias.

The application was made before judgement was handed down but after the main hearing had concluded. The Court considered its position, and concluded that there was no case for recusal. After handing down the judgement, the Court gave the reasons behind the refusal.

The application was based on the fact that one of the judges in the case, Sedley LJ, is President of the British Tinnitus Association (BTA) and has a mild form of the condition himself. Part of the claimant’s case alleged that she had developed a mild case of tinnitus due to noise exposure at work. The employers argued that if the claimant was successful in her case, this would establish damages for the condition, which would obviously further the cause of the BTA.

However, the Court determined that there was no case for recusal. Sedley LJ had clearly stated his association with the BTA at the very outset of the trial, stating that, if anyone had an objection relating to this, to “make sure I know fairly soon”.

With regard to the fact that Sedley LJ was himself a tinnitus sufferer, the Court decided that having a specific disability or condition was a point without substance, as: “It amounts to a contention that no judge with any particular disability should hear a case involving that disability. A judge with poor eyesight or only one eye could not hear a case about an eye injury, a judge in a wheelchair could not hear a case about an injury which made the victim wheelchair bound and so on. And, taken to its logical conclusion, the argument would meant that a disabled judge could not hear a case about disability living allowance, or a woman judge hear a case about sexual discrimination against a woman.”

Also, the application itself was made seven weeks after the hearing: long after the points at issue in the application had been revealed to the employers. The application came far too late, especially since Sedley LJ had expressly informed the Court that any doubts about his neutrality should have been raised as soon as possible.

The Court of Appeal concluded: “It is not open to a party which thinks it has grounds for asking for recusal to take a leisurely approach to raising the objection. Applications for recusal go to the heart of the administration of justice and must be raised as soon as is practicable.”

Technorati Tags: British Tinnitus Association, Judicial Bias, Nottinghamshire and Derbyshire Deafness Litigation, Recuse Refusal

The Government has announced further details concerning the new “Statement of Fitness to Work” which is set to replace the current “sick note”.

The current medical statement issued by GPs is generally viewed as inadequate and easily manipulated. Current research has demonstrated that being in work is beneficial to employee health, while being out of work can have a negative impact on both physical and mental well-being.

The intent of the new notes is to encourage people to stay in work (or get back to work), while encouraging a more supportive work environment for those with physical and/or mental health issues. The proposed system will concentrate on addressing health problems at an early stage and developing more inclusive work management systems which will support workers and encourage them into the workplace.

The British economy is estimated to lose around £13 billion a year due to sickness absence, with 172 million working days lost annually. Under the new system, GPs still be able to indicate whether or not a person is fit for work, but they will now also be able to designate that a person is fit to work reduced duties or to carry out alternative work.

In order to help encourage employees to stay in the workplace, GPs will be able to recommend the following:

• A phased return to work.
• Alteration of work hours.
• Amended duties.
• Modifications to the workplace to accommodate health problems.

The new system is intended to shift the focus from what an employee can’t do to what they can do, in an attempt to reduce the damaging effects of sickness absence to both workers and their employers. If the new proposals are approved, the changes could be implemented by early next year.

Ashby Cohen solicitors specialise solely in UK employment law, and have many years of experience in negotiating the vagaries of this broad and complicated subject. Visit our employment law web site for more information on the services we provide.

Technorati Tags: Fit Note, Sick Note, Sickness Absence, Statement of Fitness to Work

Employers can be held responsible for discriminatory behaviour on the part of their employees if that behaviour is carried out “in the course of employment”, a loose definition which also includes social gatherings organised by work.

However, if the employer can demonstrate that they had taken preventative measures to minimise the chances of a discriminatory act occurring, they may have a valid defence against future claims.

The European Recommendation and Code of Practice on the Dignity of Women and Men at Work gives employers specific recommendations on how to prevent sexual harassment. If a case is brought against an employer, compliance with these guidelines will go a long way to convincing an Employment Tribunal that the employer is not liable.

The Code makes the following recommendations:

• Issue a policy statement which specifically states that all workers have the right to be treated with dignity at work, that any form of harassment will not be tolerated and that employees have the right to complain should an incident occur.
• Communicate the policy to all employees, making them aware of their right to complain and who they should complain to, and also the likely consequences of harassing behaviour.
• Make managers and supervisors aware of their duty to ensure that sexually harassing behaviour does not occur in areas for which they are responsible, and remind them that they should be confidentially responsive and supportive to anyone who makes a complaint.

The Code also makes suggestions detailing what an employer should do if a complaint is made:

• Formal and informal means of resolving harassment issues should be available to employees.
• An individual should be designated to provide assistance and advice to employees who are victims of harassment of a sexual nature.
• A formal procedure should specify who complaints should be brought to, and also set out an alternative if complaining to the designated individual would be inappropriate for the employee in question.
• Complaints investigated internally should be independent and objective, and care should be taken to respect the rights of both the complainant and the alleged harasser.
• Violations of the employer’s harassment policy should be regarded as a disciplinary offence.

Having such a policy in place will not only help to prevent an employer being liable in the event of a sexual harassment claim, but it should also make it more difficult for harassment to occur in the first place.

Technorati Tags: Employer Liability, Sexual Harassment

Details of proposed changes to the Employment Agency Regulations have been released by the Government, and it appears that they may cause some problems for employers.

At present, staff hired through an agency have to go through immigration checks from both the agency and the employer. This situation is obviously not ideal, as it involves costly and time-consuming unnecessary duplication of the process. The Government is now proposing that the check should be carried out solely by the employer.

According to the consultation paper detailing the proposals, many employment agencies carry out the majority of their business over the Internet, and it seems likely that a number of them are not performing the checks that they are required to.

Rather than devoting time and resources to enforce the current regulations, which would almost certainly impede the business of legitimate online agencies, the Government would rather remove the requirement for checks from agencies altogether. Employment agencies are regarded as essential to the flexibility and dynamism of the economy, so the Government is reluctant to hamper their smooth operation.

However, if the proposed changes come into effect, the obligation to complete immigration checks will reside solely with the employer. This creates a potential problem in that prospective new employees could advance a long way through the recruitment process before it is discovered that they are not eligible to work in the UK, which would a waste a lot of the employer’s time and money.

To counter this, employers should seek to make sure that they only deal with reputable employment agencies who have basic screening procedures in place in order to minimise the chances of a potential recruit falling foul of an immigration check.

Technorati Tags: Agency Proposals, Employment Agency Regulations, Immigration Checks

The recent case of McBride v Standards Board for England has established that an Employment Judge sitting alone at a Case Management Discussion (CMD) has the power to rule that the evidence of a proposed witness is irrelevant, and that they should accordingly not be called the ensuing substantive hearing.

Having made a protected disclosure against his employer, the Standards Board for England, Mr McBride subsequently brought a series of claims against them, including sex and racial discrimination and detrimental treatment. On the last of these claims, an Employment Judge sitting alone at the CMD made a number of orders, including:

• Seven of the eight witnesses the claimant wished to call at the tribunal were deemed to be unable to give evidence relevant to the case - after explaining her reasons behind the decision, the Judge ordered that he could not call the witnesses.
• On the issue of whether or not certain portions of the hearing should take place in private, the Judge declined to make a ruling. Further applications on this point could be made when the hearing commenced at the substantive Employment Tribunal.

Mr McBride objected to these two orders, and appealed against them to the Employment Appeal Tribunal (EAT). His appeal was unsuccessful.

HHJ Peter Clark in considering the case noted that Employment Judges have a broad range of powers available to them to make case management orders. Stopping certain witnesses from giving evidence was a legitimate case management order, as under the Employment Tribunal Regulations 2004 Rule 10(2)(c), a Judge may make an order for a witness to attend a tribunal.

When making such an order, the Judge must first make an assessment of the relevance of the evidence that that witness would provide. If the Judge considers that the potential witness cannot provide relevant evidence, the order to require them to attend will not be made, and the witness will not be present at the subsequent tribunal.

In the words of HHJ Clark: “It is plain that the effect of refusing a witness order will be that the witness will not attend and give evidence at the substantive hearing. That is no different from the effect of the Judge’s order in the present case. It is a permissible case management order.”

Although Rule 27(2) of the Regulations states that, “a party shall be entitled to give evidence, to call witnesses, to question witnesses and to address the tribunal,” this right does not extend to witnesses whose evidence is irrelevant.

In the case of the second order, the prior case of Chelsea Football Club PLC v Smith had already established that this type of order was legitimate.

Mr McBride’s appeal was accordingly dismissed, and the orders made by the Judge will stand as the case proceeds to a hearing.

Technorati Tags: Case Managment Discussion, Employment Judge Powers, Irrelevant Witnesses

The case of Central and NW London NHS Foundation Trust v Abimbola has set an important precedent relating to the reinstatement of unfairly dismissed employees when mutual trust and confidence between the employer and employee has been lost.

Mr Abimbola worked as a psychiatric nurse for the Trust until he was dismissed after a disciplinary hearing found that the method he had used to restrain a particular patient constituted assault. He was also given a written warning for an alleged assault on another patient. Mr Abimbola brought a claim for unfair dismissal to an Employment Tribunal.

While the tribunal accepted that the Trust genuinely believed Mr Abimbola had used disproportionate force in dealing with the patient which amounted to assault, they found that there were no reasonable grounds for that belief. In serious cases such as this, where the employee has many years of service and result of the hearing could very well mean that Mr Abimbola could never work in his chosen field again, great care must be taken by the employer to adopt an even-handed approach.

The trust appealed the finding on liability but was not successful. It also appealed on the remedy imposed by the tribunal, namely Mr Abimbola’s reinstatement. This element of the appeal was successful.

Under the Employment Rights Act 1996 s116, when ordering reinstatement, an employment tribunal must consider:

• Whether or not the complainant wishes to be reinstated.
• Whether it is practicable for the employer to comply with the order.
• Where the complainant caused or contributed to his dismissal, whether it would be just to order his reinstatement.

Only the second point was relevant in this case, as Mr Abimbola did wish to be reinstated, and the tribunal had found that he had not contributed to his dismissal.

In considering the appeal, the presiding judge examined the meaning of the term “practicable” in this context. He determined that it “means more than possible”; specifically, if the mutual trust and confidence between employer and employee has been lost, then reinstatement will not be practicable.

In this case, the fact that the employer genuinely believed that Mr Abimbola had been involved in serious misconduct, even though that belief was not held on reasonable grounds, could well have breached this condition of trust and confidence. However, the Employment Appeal Tribunal (EAT) could only overturn the original decision if it was deemed perverse, or if it had reached its decision unreasonably by failing to take account of relevant factors or being unduly influenced by irrelevant ones.

In the reviewing the case, the EAT found that a number of facts had not been taken into account in the original tribunal:

• Mr Abimbola had been found to be dishonest in some of his evidence, which had caused the Trust to lose trust in him.
• He had an outstanding written warning against him , which - while not involved in his dismissal - did have an impact on whether the Trust could re-employ him.
• Mr Abimbola also had three prior allegations of sexual misconduct against him. Although unproven, these allegations would also affect the level of trust and confidence the Trust could have in him.
• The Trust genuinely believed that Mr Abimbola had restrained a patient in a headlock.

In disregarding these points, the original tribunal had clearly taken too narrow an approach to the question of reinstatement. Taking these facts into account, the Trust could not practicably be expected to reinstate Mr Abimbola. The EAT accordingly set aside the tribunal’s order and had the case remitted for a remedy hearing on ordinary compensation instead.

Technorati Tags: Employment Rights Act, Reinstatement, Unfair Dismissal

The Employment Appeal Tribunal (EAT) has again had to consider the use and meaning of substitution clauses in contractor agreements.

In the course of the case of Premier Groundworks v Josza, it was determined that a clause in Mr Josza’s contract which allowed him to delegate the provision of services to “other persons” meant that he should be considered as an independent contractor and not as a worker.

This remained the case despite the fact that he had never actually sent a substitute in his place to carry out any services.

The only conditions imposed on Mr Josza’s right to send a substitute were that he must notify his client in advance and that the representative must be at least as qualified and capable as Mr Josza himself. This was important, as other conditions imposed - for example, if the contract had specified that Mr Josza had to be “unable” to perform the services himself in order to send a substitute - then he may not have been considered an independent contractor for the purposes of employment law.

This contrasts with the recent case of Redrow Homes (Yorkshire) Limited v Buckborough and Sewell, which a similar clause was used in the agreement. However in this case, the EAT found that both parties had no intention of actually using the substitution clause, which meant that the contract was a sham and the individual was, in effect, a worker.

While there is no specific guidance on when a contractor with a substitution clause can be treated as a worker for the purposes of Working Time Regulations and other worker’s rights, recent case law indicates that:

• A substitution clause made in good faith will mean that an individual will not be considered a worker.
• Where such a clause is included for form only and there is no intention for an actual substitution to take place, the clause will be considered a sham and the contractor will be deemed a worker.
• Where the contract permits substitution only in special circumstances such as illness or absence, the individual will still be considered a worker.

Anyone still in doubt of the status in law of an individual regarding contractors and substitution clauses should obtain professional advice from employment law solicitors.

Technorati Tags: Employment Contracts, Substitution Clauses, Worker's Rights