Employment Newsletter June 2012

Dear Employer

You may have been excited to hear in the news of the proposal that there be “no fault dismissal” on the basis that the Employer pay specified compensation. However, that is unlikely to happen any time soon; probably best to content yourself for the time being with the fact that since April this year the qualifying period for being able to claim unfair dismissal (which includes constructive unfair dismissal) has increased to 2 years. But, before you get too carried away, remember that a discrimination claim does not require any minimum qualifying period, so be sure before you dismiss that you are unlikely to face that sort of claim. As always, if in doubt, shout.

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

Reasonable Investigation and Suspension

Employers should beware of suspending as a knee-jerk reaction. A recent case involved the employer investigating misconduct and suspending employees. The case concerned care workers who had used a form of restraint on a difficult mental patient. The NHS Trust regarded this as misconduct and immediately suspended them. This was despite the fact that, though such conduct was unauthorised under the Trust’s internal rules, it was no more extreme than other authorised procedures. On the basis that it “must be an assault”, the Trust also involved the police. The Trust dismissed the workers, who brought claims for unfair dismissal.

The judgment that was given in favour of the employees suggested that some employers may be too ready to resort to such measures, especially when confronted with a “protection” issue. The result can be an imbalance between that factor and good employment practice. Apart from the judge being astonished that the Trust had seen fit to involve the police, he said that even where there is evidence supporting an investigation, it does not mean that suspension is automatically justified. He also said, “It should not be a knee-jerk reaction, and it will be a breach of the duty of trust and confidence towards the employee if it is.” In short, it can lead to a constructive dismissal claim. Employers should heed those words when they are considering suspension. (Crawford and Anor v. Suffolk Mental Health Partnership NHS Trust)

Employees Abroad

Increasingly, British businesses have employees who work abroad for periods of time. The question can arise as to whether they are entitled to bring an employment claim under British law. The recent Supreme Court judgment in the case of Ravat v Halliburton Manufacturing & Services Ltd has clarified the position. A previous case established that there are three broad categories of employees:

· the standard employee working in Britain
· the peripatetic employee (e.g. who lives here and commutes abroad to one or more countries or lives abroad but commutes here)
· the ex-patriot employee (e.g. employees “posted” abroad by a British employer for the purposes of a British business)
It had been the case that British employee protection would clearly apply to the standard employee; however, it would only apply to the peripatetic employee if the base was Britain and to the ex-patriot employee if there were otherwise equally strong connections to Britain.

In the current case of Ravat, he worked as a “rotator” with 28 days working in Libya alternating with 28 days rest at home in Preston. He was made redundant by his British employer and tried to make an unfair dismissal claim in Britain.

The factors in Mr Ravat’s case included the fact that his employment contract was said to be subject to the law of England & Wales. He was described in his contract as a “UK commuter”, and when not working on rotation in Libya, he lived at home in England. He was paid in sterling with deductions for UK tax and National Insurance contributions. He participated in the UK employees’ benefit package. His employer was a group company, although Mr Ravat performed no work at all in the UK, performing his duties for a German group company. His Operations Manager was in Libya and his Line Manager in Cairo. HR support was provided from Scotland.

The Supreme Court held that he was entitled to claim unfair dismissal. It clarified the test of whether an employee is eligible to claim British employment protection by formulating the new test which is “whether the connection with GB is sufficiently strong to enable it to be said that Parliament would have regarded as appropriate for the Tribunal to deal with the claim”.

Of course, this means that every case will (as usual) depend entirely on the individual facts. However, the key issue is to consider when considering whether employees might have the right to protection under GB law include (but are not limited to):

· Where the employee was hired
· Who line manages the employee and where they are located
· The currency in which the employee is paid
· Any assurances or other indications given by the employer as to which employment protections are relevant
· Where the employee lives etc

What’s in the pipeline

Protected Conversations

Sometimes the employer and employee reach an agreement to part company, with the employee leaving with a settlement or some other benefit. A compromise agreement requires them to give up all their claims in return for accepting the money/benefit. Remember, however, that in a situation where there is no formal dispute between you and the employee, and you try to talk to the employee on a without prejudice basis, this could be taken to be a repudiatory breach of contract on your part and become the subject of a constructive unfair dismissal claim. Consultation is under way within the Government to introduce “protected conversations” to enable parties to raise an employment issue at any time (i.e. without the existence of a formal dispute) as a way of resolving the matter without fear.

The Employer Traps and Other Tips

Unlawful Provisions in Contracts of Employment

Ensure that your contracts do not have any clauses that are unlawful and/or otherwise unenforceable. Examples include not allowing someone to have accrued holiday pay when they leave if they have been dismissed; putting in a retirement clause that says they must retire at 65 (if it is already there from previously, just remember not to enforce it); providing for insufficient notice to be given to the employee of the termination of their employment; and benefits that are age-related that cannot be justified and therefore may lead to allegations of discrimination.

Selection Process

Remember that there are limits on what you can ask about an applicant’s health at interview stage; this situation changes once an offer of employment has been made to the applicant.

Changes in Contracts

It is a legal requirement that any changes in an employee’s contract should be given to them in writing within one month of the change.


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