Welcome to the Autumn Employment Law Update. The Employment Law Update provides the legal notices that HR Professionals need to be kept aware of. If you want to ensure you don’t miss the latest Employment and HR you can subscribe to our Employment Law Update Newsletter.
The Supreme Court increases employer liability for historic holiday pay claims
The Supreme Court recently held in Police Service of Northern Ireland v Agnew that employees may pursue unlawful deduction of wages claims for historic holiday where there is more than a 3-month gap between deductions, provided that the deductions can be linked. Previously, the position was that the deductions could only be linked where there they occurred less than 3 months apart (as decided in Bear Scotland v Fulton). The Supreme Court remarked that the position under Bear Scotland v Fulton could lead to unfair outcomes for employees and instead found that claims should be permitted where a series of deductions can be linked when considering all of the relevant circumstances, such as the frequency and reason for the deductions.
In Police Service of Norther Ireland v Agnew, police officers and civilian employees of the police service pursued claims for unlawful deductions from wages relating to incorrectly calculated holiday pay. The employees were required to undertake regular overtime, however they only received basic pay during periods of annual leave. Instead, the employees’ holiday pay entitlement should have been calculated taking the overtime worked into account.
Implications
This case leaves employers exposed to potentially increased liability for historic holiday pay claims as employees are now able to make claims for a series of deductions more than 3 months apart. However, in Great Britain, the Deduction from Wages (Limitation) Regulations 2014, places a 2-year limitation period on unlawful deduction of wages claims which limits employers’ exposure to historic pay claims. There is no legislation to this effect in Northern Ireland, therefore employers may face claims for historically unpaid holiday pay dating back many years, thus increasing the financial implications. It is estimated that there are in excess of 130,000 unlawful deduction of wages claims pending judgment.
We would advise employers to carry out a review of their holiday policy to ensure that pay is being calculated correctly, taking overtime into account.
Employers are under an obligation to make reasonable adjustments even when it is not privy to specifics of the job applicant’s alleged substantial disadvantage
What the Law says
The Equality Act 2010 (EqA), s39(5), places employers under a duty to make reasonable adjustments for disabled workers and potential applicants to their organisation. The duty requires employers to take steps to avoid a disabled person being placed at a substantial disadvantage created by a provision, criterion or practice (PCP) the employer has put in place.
An employer is not subject to the duty to make reasonable adjustments if it does not know, and could not reasonably be expected to know, both that the complainant has a disability and that they are likely to be placed at a substantial disadvantage because of it.
The Facts
In the recent Employment Appeals Tribunal (EAT) decision in AECOM Ltd v Mallon, it was held that employers are required to make reasonable adjustments for disabled individuals in circumstances where they do not know how they may be disadvantaged by a particular provision, criterion or practice (PCP).
In this case, Mr Mallon contacted AECOM by email expressing an intention to apply for a role, requesting to apply orally over the telephone as opposed to using the usual online portal, due to difficulties caused by his having dyspraxia. AECOM responded, insisting that he complete the online form but offered to provide assistance over the telephone on any parts of the form he had difficulty with. AECOM knew Mr Mallon suffered from dyspraxia but in order to establish the disadvantage suffered as a result of his condition it asked what particular difficulties he experienced in completing online forms, but he did not provide this information.
Mr Mallon brought a disability discrimination claim for a failure to make reasonable adjustments and succeeded at the Employment Tribunal (ET). AECOM appeal to the EAT and the first instance decision was upheld by the EAT, finding that AECOM had constructive knowledge that Mr Mallon’s dyspraxia caused him difficulties in accessing the online portal and completing the application and as such, they should have contacted Mr Mallon by telephone to learn more about his circumstances.
Lesson for Employers
This case serves as a reminder to employers that the duty to make reasonable adjustments arises prior to employment, during the application process and during employment and that knowledge of a disability causing a substantial disadvantage is sufficient to give rise to that duty.
In this case, the employer knew the claimant had dyspraxia at the point the application was made. It had been told about the ways that dyspraxia could affect individuals. This information alone was sufficient for it to be aware that it was under a duty to make reasonable adjustments, and the fact the claimant had not responded to an email request to disclose more details is not enough to discharge this duty.
There is no dismissal in circumstances where employment is terminated by mutual consent on ill-health grounds
In Riley v Direct Line Insurance Group PLC, the Employment Appeal Tribunal (EAT) upheld the Employment Tribunals (ET’s) decision, finding that Mr Riley had not been dismissed and instead, his employment was terminated by way of mutual consent.
Mr Riley had been on long-term sick leave due to his suffering from autism and medical evidence had been received stating that he would be unable to return to work. He had cover under a health insurance scheme, under which he would receive salary-like payments up to retirement if he was unable to work due to ill-health. Direct Line held a formal meeting with Mr Riley at which it was agreed that his employment would be terminated by mutual consent. Direct Line subsequently sent Mr Riley a letter confirming that he was ‘dismissed’.
Mr Riley then sought to bring a claim for unfair dismissal. The ET looked beyond the wording of Direct Line’s letter and found that the termination of Mr Riley’s employment was incorrectly labelled as a ‘dismissal’. The EAT agreed with the ET that Mr Riley clearly understood the decision he was taking and was not pressured by Direct Line in any way.
Lesson for Employers
Whilst the employer here was ultimately successful in defending this claim, employers should be careful to use clear and accurate language when an employee’s employment is terminated or ends. Settlement Agreements can be used to avoid disputes arising.
Update on the Worker Protection (Amendment of Equality Act 2010) Bill
In our April newsletter we discussed the liability that was to be imposed on employers for the harassment of employees by third parties under the Worker Protection (Amendment of Equality Act 2010) Bill which was being read by the House of Lords. The Bill has since been diluted by the House of Lords, removing this element due to concerns over the weight of the burden it would place on employers. The Bill will however still impose a positive duty on employers to prevent sexual harassment in the workplace, though employers will now be required to take ‘reasonable steps’ as opposed to ‘all reasonable steps’ to prevent employees from being sexually harassed, which is a lesser legal obligation.
The amendments proposed by the House of Lords are currently being considered and the next stage will be for the Bill to receive royal assent. We will update you further once we know when the Bill is due to come into force.
New legislation to provide for minimum service levels during strike action
The Strikes (Minimum Service Level) Act 2023 has received royal assent and, once in force, will provide for minimum service levels for essential services, such as rail, ambulance and fire, during periods of strike action. The legislation is intended to balance the right to strike with allowing the public access to emergency services and to travel to work by public transport. It is also thought that minimum service levels will be imposed within other key sectors, such as education and border security.
The Government is currently reviewing responses to a public consultation on the steps trade unions ought to take in order to comply with the legislation. There is currently no word on when the new legislation will come into force but we will keep you updated.
Workers given the right to request a predictable working pattern
The Workers (Predictable Terms and Conditions) Act has recently received royal assent and will provide workers with a statutory right to request a more predictable working pattern. The legislation is targeted at shift workers and those on zero hours, enabling them to request more certainty as to the days, hours and number of hours that they work. Similar to the new Employment Relations (Flexible Working) Act, in order to be eligible to make a request, workers will need 26 weeks’ service and can make up to 2 requests in any 12-month period. Employers must respond to a request within 1 month. There Act will contain a list of grounds for employers to refuse a request, including costs and insufficient workload.
It is thought that this new legislation will lead to increased job satisfaction and greater staff retention, particularly in sectors where atypical work is most common.
Employers should be wary of discrimination issues that may arise off the back of a request, for example women seeking more regular working hours to arrange childcare.
The new legislation is expected to come into force in late 2024 and ACAS guidance will be published in advance. We will keep you updated.
ACAS published updated guidance on sickness absence
ACAS has recently published updated guidance which includes:
- checking holiday entitlement and sick pay;
- fit notes and proof of sickness;
- time of for dependants;
- returning to work after absence;
- creating absence policies;
- recording and reducing sickness absence; and
- absence trigger points.
Most notably, the guidance widens the definition of sickness absence to capture those that are unable to work due to illness, injury or another medical reason. The guidance also includes more detailed suggestions on how to deal with an employee’s return to work, such as appraising them of updates in the workplace whilst they were absent and agreeing a plan for their return (including appropriate hours and tasks). Employers should also consider requesting a report from the employee’s GP detailing whether they are ready to return to work and any reasonable adjustments that can be made.
It is important to have effective policies in place to manage sickness absence in order to limit the disruption to the business and help employees return to work.
The full guidance can be viewed here: https://www.acas.org.uk/holiday-sickness-leave
For advice on Employment Law or HR Issues please contact Tom Evans via email tom.evans@dtmlegal.com
