XpertHR provides summaries of recent employment tribunal
rulings.
Deductions without consent or notification were designed to destroy employment relationship
Employer’s redundancy scoring decision discriminated against male employee
Employer acted reasonably in not waiting for outcome of criminal proceedings
Failure to take leave due to sickness was not a bar to holiday pay
Lengthy campaign of racial harassment condoned by employer
Employer failed to establish fair reason for dismissal
Zero hours provisions in contract still enforceable after years of full time work
Employee already on sick leave not entitled to full pay when suspended
Employee who made Nazi salute was unfairly dismissed
Employer’s attitude to contractual bonus was a fundamental breach
Agreement to reduce hours amounted to entirely new employment relationship
Loss of cleaning contract did not result in TUPE transfer
Note: The decisions are not binding on other tribunals and are intended to provide illustrations for employers of situations that have led to tribunal claims. They are reported on XpertHR as soon as the transcript becomes publicly available, which is normally four to six weeks after the judgment has been made.
Back to top
Deductions without consent or notification were designed to destroy employment relationship
Jones v Leather Sofa Company ET/1607568/08
Date added: 27 May 2010
constructive dismissal | unlawful deductions from wages
This case serves as a reminder of the importance of pay in an employment relationship, and the danger to employers should they neglect that fact.
Mrs Jones was a manager at the Leather Sofa Company, and received a basic salary and commission, but was not given a contract of employment. Over a substantial period of time, Mrs Jones’s employer made a number of deductions and alterations to her wages, but without her consent or any notification. In August 2008, Mrs Jones resigned, stating that she was “no longer able to survive with the inconsistency of the pay levels”, and claimed constructive dismissal.
The tribunal stated that employees are entitled to “absolute clarity” as to the amount of money they are to receive for work, and that “anything to do with payment or non-payment of money can only be a fundamental term of the contract”. It follows that any breach of such a term will therefore be a fundamental breach of contract, and the tribunal found that the actions of Mrs Jones’s employer, in making repeated deductions without notification or consent, were designed to destroy the employment relationship between the parties. The tribunal therefore upheld Mrs Jones’s claims for constructive dismissal and unlawful deductions from wages, and awarded her over £7,000.
View the full transcript
of the case.
Back to top
Employer’s redundancy scoring decision discriminated against male employee
de Belin v Eversheds Legal Services Ltd ET/1804069/09
Date added: 26 May 2010
sex discrimination | unfair dismissal | redundancy | selection criteria | maternity leave
This case, which has received a great deal of publicity, concerns a difficult question for employers: how should they treat employees on maternity leave when it comes to scoring in a redundancy process?
Mr de Belin was a property lawyer at Eversheds. In September 2008, the firm decided to make one property lawyer in its investor team redundant, and placed Mr de Belin and his colleague Mrs Reinholz in a redundancy selection pool. Prior to the two employees being placed at risk, Eversheds had scored them against selection criteria. One criterion was “lock-up”, which is a measurement of the amount of time between a lawyer carrying out a piece of work and receiving payment for that work from the client. Eversheds had determined that the date at which the two employees should be scored for lock-up was 31 July 2008, and Mr de Belin was accordingly scored half a point.
However, on 31 July Mrs Reinholz was on maternity leave, and Eversheds determined that, given that no actual score could be given as at that date, she should be awarded a full notional score for lock-up of two points. This decision proved crucial, as ultimately Mr de Belin scored half a point less, overall, than Mrs Reinholz, and accordingly was dismissed for redundancy. Mr de Belin submitted a grievance about this decision, arguing that he had been discriminated against by the firm’s decision to award Mrs Reinholz full points for lock-up, and suggested alternatives. However, Eversheds felt that its decision was the fairest approach in the circumstances, and did not uphold the grievance. Mr de Belin therefore brought a claim for sex discrimination and unfair dismissal.
The tribunal decision turned on its interpretation s.2(2) of the Sex Discrimination Act 1975 (SDA), which states that an employer does not discriminate against a man where it affords a woman “special treatment” in connection with childbirth or pregnancy. Eversheds had relied on this provision when rejecting Mr de Belin’s grievance. The tribunal heard evidence that Eversheds had expressly stated, during the grievance process, that it had awarded Mrs Reinholz full points for lock-up in order to avoid a discrimination claim from her.
The tribunal found that the meaning of s.2(2) of the SDA is far from clear, but held that “special treatment” does not mean all treatment afforded to woman in connection with pregnancy or childbirth. The tribunal went on to hold that the provision is not intended to protect a woman on maternity leave in a redundancy scoring exercise where she has received an unfairly inflated score, and therefore that Mr de Belin had been discriminated against and unfairly dismissed.
View the full transcript
of the case.
Back to top
Employer acted reasonably in not waiting for outcome of criminal proceedings
Donaghey v Secretary of State for Work and Pensions (Jobcentre Plus) ET/1502952/08
Date added: 24 May 2010
criminal proceedings | benefits | unfair dismissal
If an employee faces criminal prosecution for reasons that could also result in his dismissal, should the employer wait for the outcome of those proceedings, or begin its internal disciplinary process immediately? Jobcentre Plus faced that decision in this case.
Mr Donaghey was an executive officer at Jobcentre Plus and, following a back injury at work, was awarded disability living allowance from 1995 for an indefinite period. After an anonymous complaint in 2007 and subsequent investigation involving covert surveillance, the fraud department informed Mr Donaghey that he hadn’t been entitled to his allowance from October 2006, and was charged with failing to notify a change in circumstances, namely an increase in his capabilities and mobility. Once the fraud department had decided to prosecute Mr Donaghey, Jobcentre Plus considered whether to proceed with its disciplinary process or await the result of the prosecution. It went ahead with disciplinary action, and ultimately dismissed Mr Donaghey for misconduct amounting to a breach of the duty of mutual trust and confidence. Mr Donaghey claimed unfair dismissal.
The tribunal found that Jobcentre Plus had carried out a proper investigation, and had considered the covert video evidence in coming to a decision to dismiss. Although Mr Donaghey claimed that the decision to dismiss was merely “rubber stamping” the fraud department’s decision to prosecute him, the tribunal noted that Jobcentre Plus had, in deciding whether or not to go ahead with disciplinary proceedings, identified the difference between arriving at a decision on the balance of probability as against the criminal standard of reasonable doubt. It was also notable that Jobcentre Plus’s disciplinary policy explicitly provides “claiming benefit to which the employee is not entitled” as an example of gross misconduct. The tribunal therefore held that Jobcentre Plus had acted reasonably throughout, and that Mr Donaghey had been fairly dismissed.
Although in this case the employer went ahead with disciplinary proceedings, the Court of Appeal has recently held that employers have a wide discretion to postpone disciplinary investigations pending criminal trials. For more information, read our case law stop press report on Secretary of State for Justice v Mansfield EAT/0539/09.
View the full transcript
of the case.
Back to top
Failure to take leave due to sickness was not a bar to holiday pay
Southard v Abertawe Bro Morgannwg University NHS Trust ET/1606339/09
Date added: 20 May 2010
sickness absence | holiday pay | unlawful deduction from wages
This case deals with an increasingly common situation: an employee who, having been prevented by sickness from taking holiday, claims holiday pay after leaving.
Mrs Southard, who was a liaison and child protection coordinator, went on sick leave from July 2008 until the termination of her employment in August 2009. Her sickness absence meant that, after leaving, she had 35 days’ accrued but untaken contractual holiday in respect of her former employer’s 2008/2009 leave year, 18 days of which was her statutory holiday entitlement. Mrs Southard brought a claim for unlawful deductions from her wages, arguing that she was entitled to the unpaid holiday pay as a result of her contractual terms, under the Working Time Regulations 1998, and/or under the Working Time Directive (given that she was a public sector worker).
The tribunal held that Mrs Southard’s contractual arguments failed, as although the relevant contractual provisions provided for carry-over of holiday in specific circumstances, none of those applied in the present case, and as a whole they were silent on the key issue of whether or not it was possible for an employee on long-term sickness absence to take annual leave. The tribunal also held that Mrs Southard’s argument on the Working Time Directive failed, as the most recent authority on the issue states that the Directive does not have direct effect. However, the tribunal upheld Mrs Southard’s claim under the Working Time Regulations. The tribunal found that a line of case law that had been revived following the House of Lords decision in HM Revenue and Customs v Stringer means that it is not necessary for workers to actually take (or even to seek to take) their statutory holiday entitlement in order to be able to claim pay for it. The tribunal therefore ordered that the employer pay Mrs Southard for her 18 days’ untaken statutory holiday entitlement.
View the full transcript
of the case.
Back to top
Lengthy campaign of racial harassment condoned by employer
Zubin v Brett Martin Ltd NIIT/261/08
Date added: 19 May 2010
unfair dismissal | race discrimination
Although many discrimination claims are successful, it is rare to find a tribunal as critical of the employer as the Northern Ireland industrial tribunal was in this case.
Mr Zubin, a Croatian, worked as a technical operator. Over the course of his employment, he made numerous complaints about racial harassment and bullying by colleagues and management, the most shocking of which were allegations that repeated comments were made to him by a Mr McMurty that “the Serbs were right to rape your women and children”, in reference to previous conflicts between Croatia and Serbia. Mr Zubin submitted a grievance against his manager, who he alleged told him to “get these Poles to work harder”, but this was not upheld. On one occasion, Mr Zubin rang the HR department in tears, stating that he could not take any more of the racist behaviour at the company, and saying that Polish workers were called “chimps” and “white niggers”, but HR did nothing about this. In late 2007, Mr Zubin was found lying down next to his machine by Mr McMurty, who proceeded to kick and swear at him, and in due course the employer began disciplinary action against Mr Zubin. Despite Mr Zubin’s arguments that this was all part of the campaign of racial harassment against him (he made 17 separate references to discrimination), the employer ignored him, treating the incident purely as a health and safety matter, and ultimately dismissing him for gross misconduct. Mr Zubin claimed unfair dismissal and race discrimination.
The tribunal unequivocally found in Mr Zubin’s favour. It found that a culture prevailed in the employer whereby racist bullying continued on an ongoing basis, and workers were afraid to speak up about it. Management and HR were aware of all this, but did nothing about it. The tribunal found that Mr Zubin had been subjected to gross racial harassment and bullying by Mr McMurty, which was not only tolerated by the employer, but effectively condoned by the management’s failure to do anything about it. The tribunal held that there was no excuse for the employer’s failure to look at the wider points made by Mr Zubin during the disciplinary process, and that racism permeated all his dealings with management in that process and during his grievance. Mr Zubin’s dismissal was therefore an act of racial victimisation, and therefore discriminatory and unfair.
The tribunal awarded Mr Zubin over £53,000 in compensation, including £20,000 for injury to feelings in respect of the discrimination he had suffered.
View the full transcript
of the case.
Back to top
Employer failed to establish fair reason for dismissal
Williams v Balfour Beatty Utility Solutions Ltd ET/160825/09
Date added: 17 May 2010
unfair dismissal | fair reason for dismissal
Most unfair dismissal claims turn on whether or not the employer has acted reasonably in all the circumstances. However, employers first have to prove that there was a fair reason for dismissal, as this case demonstrates. Mr Williams was employed by Balfour Beatty as a labourer, carrying out repair works on roads. In April 2009, Mr Williams and his two colleagues were asked to carry out an urgent repair on a pothole on the A40. The team did not have the necessary safety equipment, which was at another location. The job, which consisted of pouring tarmac into the pothole, took only minutes but, at the same time and by unfortunate coincidence, a member of the South Wales Trunk Road Agency just happened to be driving by. He stopped the team and ultimately issued a formal notice citing a lack of safety measures. Balfour Beatty commenced disciplinary proceedings against Mr Williams for health and safety breaches and ultimately dismissed him, along with his two colleagues, for gross misconduct. Mr Williams’ appeal was not upheld, and he brought a claim for unfair dismissal. Mr Williams argued that the true reason for his dismissal was not misconduct, and that the incident in question was simply a convenient excuse to dismiss employees who were surplus to requirements. The tribunal agreed, and found that Balfour Beatty had failed to prove that it had dismissed Mr Williams for the reason it had relied on, namely that he had committed the alleged health and safety breaches in question. The following factors raised sufficient doubts in the tribunal’s mind as to the genuineness of the reason given by Balfour Beatty for dismissal:
- The cursory nature of the disciplinary process. Mr Williams was informed that his colleagues had been dismissed before his disciplinary hearing took place and was told, after he had been dismissed, that the decision was not the disciplinary officer’s, but “had come from above”. Both of these facts indicated that the disciplinary outcome had been decided in advance.
- The fact that Balfour Beatty did not replace any of the dismissed employees.
- The gravity of the sanction imposed – gross misconduct – in relation to the relatively minor nature of the alleged offence.
- Balfour Beatty’s failure to have regard to the mitigating circumstances in the case. This included the fact that the urgent repair in question had been carried out at the specific request of the team’s supervisor as an unscheduled “favour”. The company had also failed to consider the fact there was a shortage of safety equipment, and that the team undertook such safety measures as they were able to in the circumstances.
The tribunal therefore held that Mr Williams had been unfairly dismissed and stated that this would have been the case even if Balfour Beatty had established a fair reason for dismissal, finding that it had acted unreasonably in the circumstances.
View the full transcript
of the case.
Back to top
Zero hours provisions in contract still enforceable after years of full-time work
Davies v Hertz (UK) Ltd ET/3303522/09
Date added: 13 May 2010
zero hours contract | custom and practice | unlawful deductions from wages
Zero hours contracts are a useful option for employers that cannot guarantee a consistent level of work for their staff. But can an employer still rely on zero hours provisions to reduce an employee’s hours after years of giving them full-time work? Mr Davies worked as a driver for Hertz, and was employed under successive zero hours contracts. Although these contracts provided that Hertz had no obligation to provide work to Mr Davies, he in fact worked full-time hours since the start of his employment in 2003. In April 2009, Hertz informed Mr Davies that his working days were to be reduced from five to two, which Mr Davies complained about. In due course, Mr Davies’ employment came to an end for unrelated reasons, and he brought a tribunal claim for unlawful deductions from wages. Mr Davies’ argument was that, by offering him the equivalent of full-time hours for five years, Hertz had indicated that it did not intend to apply the zero hours provisions in his successive employment contracts. However, the tribunal held that the fact that Hertz was able to offer Mr Davies the full-time hours he wanted for a long period of time did not mean that it had voluntarily relinquished its right not to offer work, as provided by the zero hours contracts. The tribunal found no evidence of a custom or practice that would indicate that the zero hours provisions were a sham, and therefore Mr Davies’ claim failed.
View the full transcript
of the case.
Back to top
Employee already on sick leave not entitled to full pay when suspended
Hemming v Cambridge Centre for Sixth Form Studies Ltd ET/1503356/09
Date added: 12 May 2010
unlawful deductions from wages | sick leave | suspension
Employment contracts and staff handbooks are important documents, but any ambiguity about how different provisions relate to each other can result in tribunal claims, as this case demonstrates. Mr Hemming was employed by the Cambridge Centre as IT network manager. In May 2009, he began long-term sick leave, from which he did not return. In accordance with the staff handbook, he was paid 30 days' sick leave at full pay, and statutory sick pay for the remainder. In August 2009, the Cambridge Centre suspended Mr Hemming pending a disciplinary investigation regarding inappropriate images found on his work computer. Mr Hemming was ultimately dismissed as a result of these allegations in January 2010. He brought a claim for unlawful deductions from wages, relying on a provision in the staff handbook that stated that, in connection with disciplinary investigations, the Cambridge Centre “reserves the right to suspend the employee immediately with pay while the matter is investigated”. Mr Hemming’s contention was that this clause meant that he should have received full pay during the period of his suspension, even thought he was on sick leave at the time. The tribunal disagreed with him. It found that the words “with pay” in the suspension provision were not the same as “full pay”, as used in the sick leave provisions, and that “with pay” comfortably accommodated statutory sick pay. The tribunal held that Mr Hemming had no right to receive more than whatever pay he was entitled to at the time of his suspension, which at that point was statutory sick pay only. Therefore, as there was no deduction from Mr Hemming’s wages, unauthorised or otherwise, his claim failed.
View the full transcript
of the case.
Back to top
Employee who made Nazi salute was unfairly dismissed
Wright v St James Security Ltd ET/2509442/09
Date added: 10 May 2010
unfair dismissal | compensatory award | basic award
This case, which concerns a dismissal for gross misconduct in unusual circumstances, provides a useful example of how tribunals are approaching the issue of compensation under the Acas Code of practice on disciplinary and grievance procedures (PDF format, 1.58MB) (on the Acas website). Mr Wright was a ticket inspector for his employer, which provides security services for the Tyne and Wear Metro. In April 2009, a member of the public made a complaint about the behaviour of ticket inspectors on a specific occasion, stating that one of them had made a Nazi salute at him and his daughter. Following an investigation and disciplinary process, which involved inconclusive CCTV footage as evidence, Mr Wright was dismissed for gross misconduct. Mr Wright’s appeal against dismissal failed, and he claimed unfair dismissal. The tribunal found that the alleged act was capable of justifying summary dismissal, and that the employer had a genuine belief in Mr Wright’s misconduct. However, the tribunal identified three flaws in the employer’s disciplinary procedure, which were that:
- the employer at no point disclosed to Mr Wright over 20 witness statements it had obtained from his colleagues;
- the employer did not make all potentially relevant CCTV footage available for Mr Wright to view; and
- there was a lack of separation between the investigatory and disciplinary stages of the procedure.
The tribunal held that these flaws took the employer’s decision to dismiss outside the band of reasonable responses, and therefore Mr Wright’s claim succeeded. However, the tribunal found that, on balance of probabilities, Mr Wright had made the Nazi salute, and that regardless of the procedural unfairness, he would have been dismissed in any event. The tribunal therefore declined to award him a compensatory award for unfair dismissal, although it felt it was just and equitable not to reduce his basic award. It also held that, although the dismissal was unfair, the employer was not in breach of the Acas Code to the extent that an uplift of compensation should be made, although in practice this would have made no difference.
View the full transcript
of the case.
Back to top
Employer’s attitude to contractual bonus was a fundamental breach
Virdee v Dickins t/a Chris Dickins Solicitors ET/2329447/08
Date added: 6 May 2010
unpaid wages | constructive dismissal
This case demonstrates that, even if an employer is correct in its interpretation of a contractual term, the manner in which it deals with an employee in respect of that term can still give rise to a constructive dismissal. Miss Virdee worked as a solicitor for Mr Dickins, and had a contractual quarterly bonus of fees in excess of £15,000. Miss Virdee proposed that this be varied to a monthly bonus for a year, but Mr Dickins neither accepted nor rejected this request, merely saying that he did not have time to deal with it. Nevertheless, Miss Virdee repeatedly requested monthly bonus payments, and after submitting a grievance about this and other matters, resigned and claimed constructive dismissal. A central part of Miss Virdee’s claim was that Mr Dickins had accepted her proposed variation to the bonus arrangement, and that he was in fundamental breach of contract by failing to pay that monthly bonus on several occasions. The tribunal found that, as a matter of strict contract, there was no breach of Miss Virdee’s express contractual bonus entitlement. However, it held that Mr Dickins’s approach and attitude to the payment of Miss Virdee’s bonus amounted to a fundamental breach of the duty of trust and confidence. The tribunal found that Mr Dickins had left matters regarding the bonus deliberately vague and unclear, and complained that Miss Virdee was “demanding” payment without any recognition of whether or not he accepted that she was contractually entitled to a monthly bonus payment or not. For this, and other fundamental beaches of contract, the tribunal held that Miss Virdee had been constructively dismissed.
View the full transcript
of the case.
Back to top
Agreement to reduce hours amounted to entirely new employment relationship
Canestrelli v Il Gelato Di Ariela ET/3302257/09
Date added: 5 May 2010
unlawful deductions from wages | variation of contract | unfair dismissal
Although this case concerns a number of issues, it is most interesting for the tribunal’s unusual findings on a variation of the claimant’s contract. Miss Canestrelli worked as a general manager for Il Gelato, which makes and sells ice cream. Following a dispute about Miss Canestrelli’s performance, her employment ended in early 2009. Her employer asserted that she had resigned, but she brought claims for unfair dismissal and unlawful deductions from wages. A crucial point in the unlawful deductions claim was whether or not both parties had, in November 2008, agreed a variation to Miss Canestrelli’s contract that reduced her hours to two days per week. Miss Canestrelli relied on her contract of employment, which stated that any variations to it had to be in writing. The tribunal found, on the facts, that the parties had reached an agreement that Miss Canestrelli’s hours would be so reduced. Turning to Miss Canestrelli’s contractual argument, the tribunal held that the agreement was not a mere variation, but in fact amounted to an entirely new employment relationship. The original contract was rescinded by mutual consent and replaced by an entirely different relationship that was not recorded in writing. The result was that although the tribunal upheld Miss Canestrelli’s unlawful deductions claim, her award was substantially lower than the amount she had claimed. The tribunal went on to dismiss her unfair dismissal claim, finding that she had resigned her employment.
View the full transcript
of the case.
Back to top
Loss of cleaning contract did not result in TUPE transfer
Barlow v Allen t/a Associated Cleaning Services ET/2407598/09
Date added: 4 May 2010
unfair dismissal | TUPE | service provision change
This case is a useful example of a tribunal’s approach to whether or not there has been a TUPE transfer on a service provision change. Ms Barlow was employed by Trafford Park Cleaning Company Ltd (Trafford) from 2000. By 2009, she was working 30 hours per week on different sites, spending a third of her time on one particular cleaning contract. In May 2009, Ms Barlow was told that Trafford had lost that particular contract to Associated Cleaning Services, and that her employment would transfer from June 2009 (although in the event, her employment with Trafford continued). Associated Cleaning Services offered Ms Barlow terms of employment, but she declined and claimed unfair dismissal. The tribunal found that there was no TUPE transfer, on the basis that there was no organised grouping of employees (even if the grouping was just Ms Barlow) that had as its principle purpose the carrying out of the cleaning activities for the client in question. The tribunal’s reasons were that:
- only one-third of Ms Barlow’s working time was spent on the contract in question;
- Ms Barlow had only worked on the contract for two years, having been employed since 2000;
- Trafford could assign Ms Barlow to any contract it wished; and
- within six weeks of losing the cleaning contract, Trafford had reassigned Ms Barlow work to replace it.
The tribunal therefore rejected Ms Barlow’s claim.
View the full transcript
of the case. |