Employment Law Update April 2012

Employment Law Update

April 2012
Dear Employer

While the headlines might have been rather gloomy recently with the news that we are apparently back in recession, many businesses will have been cheered by the outcome of the age discrimination case brought by Mr Seldon against the solicitors firm in which he was a partner (see below). The judgment by the Supreme Court suggests a way for employers to manage older employees out of the business: something that many have been worrying about since the default retirement age was abolished. Certainly it makes things clearer but, as always, the facts of each individual situation will be what counts. As always, if in doubt take advice.

If you have any particular employment issues, please do not hesitate to contact us: details are at the end of this letter. If you have any comments or suggestions on this newsletter, please email newsletter@breezeandwyles.co.uk

Kind regards

The Employment Law Team

Some Recent Cases in Employment Law

Justifying age discrimination
Judgment has now been given on further appeal on the long-running case concerning the question of whether the retirement of a partner in a solicitor’s firm was discriminatory and, if so, whether it could be justified under the (now defunct) Employment Equality (Age) Regulations 2006. The case is still relevant because it concerns direct age discrimination and when it can be justified, and applies equally to the justification of direct age discrimination under the Equality Act 2010 (Section 13(2)).
A clause in the partnership deed of the law firm provided for the compulsory retirement of partners at 65. The partner had argued that this was unjustified direct age discrimination under the Employment Equality (Age) Regulations which prohibited such discrimination in partnerships.
The solicitor’s claim was dismissed because the Supreme Court held that although the partner was the victim of direct age discrimination, the firm was able to justify it. The Supreme Court referred to the findings of the European Court of Justice (ECJ) which has shown that direct age discrimination can be justified only by reference to legitimate objectives of a public interest nature rather than purely individual reasons particular to the employer’s situation. The two categories of social policy objective which were identified by the ECJ were “inter-generational fairness” and “dignity”. The Supreme Court held that in this case the firm’s policies of staff retention (e.g. ensuring that senior solicitors were given the opportunity of partnership) and workforce planning fell within the category of “inter-generational fairness”. Also the firm’s aim of limiting the need to expel partners by way of performance management fell within the policy objective of “dignity”. As a result, the firm’s aims had the requisite social policy/public interest dimension and were therefore legitimate. (Seldon v. Clarkson Wright & Jakes)
This is a summary only and, as always, cases turn on their own facts. Take advice before acting!

Indirect Age Discrimination: Policeman disadvantaged by not having Law Degree
The Supreme Court has overturned an earlier decision whereby it was held not to be discriminatory when a police officer was unable to qualify for promotion to a higher grade because the rules of promotion required him to have a law degree and, as he was 61, he could not complete it before retirement at 65. The Court of Appeal had ruled in the employer’s favour, saying that any particular disadvantage Mr Homer suffered resulted not from age discrimination but from the fact that he was retiring. He appealed to the Supreme Court. The Court found for him and rejected the argument that the disadvantage which Mr Homer suffered was no different to the disadvantage that would be suffered by anyone due to leave the workplace for whatever reason. The disadvantage here was one that was suffered by a particular age group for a reason related to their age, and it could not be right to equate that disadvantage with a similar disadvantage suffered by others for a non-age related reason. The Court should not have to ignore the fact that certain protected characteristics (in this case, age) are more likely to be associated with particular disadvantages. Further, there is a material difference between leaving the workplace because of retirement and leaving for other reasons, e.g. family reasons. A person leaving work for family reasons usually has some choice in the matter but someone due to be retired under the (old) default retirement age provisions generally does not.

Given that there was age discrimination, could this be justified? The Court accepted that facilitating recruitment and retention of a sufficiently high calibre staff was a legitimate aim. However, it was necessary to distinguish between the justification of the criteria for the recruitment and that for entry to higher paid grades (as here) and to ask whether applying the law degree criterion to existing employees seeking promotion was appropriate. To some extent, this would depend on whether non-discriminatory alternatives were available. The case would be remitted to the Tribunal to tackle these questions. (Homer v. Chief Constable of West Yorkshire Police)

New Qualifying Period and other charges
• As advised in a previous e-zine, for those who started employment on or after 6th April 2012 the new qualifying period of two years will apply for bringing a claim for unfair dismissal or requesting a written statement of reason for dismissal. Employees who started before that date will remain subject to the one year qualifying period.
• The maximum costs obtainable from a Tribunal (for those lucky enough to be awarded them) increased from £10,000 to £20,000 and the deposit order for weak claims increased from £500 to £1,000.
• SSP: This increased this month from £81.60 to £85.85.
Changes to Immigration Rules
These came in during April, which include limiting the stay of temporary Tier 2 migrants to a maximum of six years. There are other changes: please let us know if you require further details.
Witness Expenses
From 6th April the Employment Tribunal can make a costs order requiring payment to a witness in respect of some or all of the expenses that the witness incurs in attending the Tribunal. There is no limit on the amount of expenses to be paid.
Non-solicitation of clients
A recent case has shown the Court’s attitude towards restrictive covenants: those clauses that the prudent employer will have in its contracts of employment to prevent an ex-employee from poaching its clients. There is often a “non-solicitation” clause in the contract. How far the actions of an employee amount to solicitation is often uncertain. However, the High Court has recently emphasised that “solicitation” is not decided solely by whether the employee made the first contact but whether there was an element of persuasion in the employee’s communications with the client. A contractual non-solicitation clause therefore means that former employees must not directly or indirectly request, persuade or encourage the clients of their former employer to transfer their business to the new employer. (Towry v. Barry Bennett (2012))

What’s in the pipeline

Pre-claim conciliation
The government has announced various reforms to resolving work place disputes, which will be implemented “when parliamentary time allows”. These include requiring all employment disputes to be offered ACAS pre-claim conciliation before going to a Tribunal.

The Employer Traps and Other Tips

You should always ensure that your contracts are updated by reviewing them every now and then. This includes reviewing your needs as a business and whether you need to change/tighten up in some way the restrictive covenants in your contracts.
Stressed Employees
If an employee is absent through stress, make sure you do not ignore this. Remember that you are expected to behave as a reasonable employer which means discussing the situation with the employee and, if appropriate, making a referral to occupational health at an early stage.

Other news from Breeze and Wyles

Debt Recovery Service

We offer a low cost, fixed fee debt recovery service aimed at assisting businesses to chase unpaid invoices. An initial letter to a debtor costs just £2.00 plus VAT. This means that businesses can cost effectively chase their aged debtors. Many businesses now use this service to chase debts that otherwise would have been written off, because it offers such a cost effective and efficient solution. For further information please contact Rita Wright at:

rita.wright@breezeandwyles.co.uk or telephone 01992 558411.

Breeze and Wyles Solicitors LLP are a leading law firm with offices throughout Hertfordshire and Middlesex, providing quality legal service in all of the mainstream areas of the Law for over 90 years.

We are one of very few law firms that offer services online. Check out our services Solution for volume legal instruction at www.breezeplus.co.uk

We have been awarded Lexcel Accreditation and are regulated by the Solicitors Regulation Authority. For further information on any of the issues referred to in this newsletter, or any other employment matter, please contact Jane Dismore at:

2nd Floor, Stag House, Old London Road, Hertford, SG13 7LA
Tel: 01992 558411 Fax: 01992 503889
Email: jane.dismore@breezeandwyles.co.uk

Please note that this e-zine is for information only and is not intended to be relied upon in any individual case. You should always seek advice on any individual issues.

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