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Employment & HR

November’s Employment & HR Update covers:

1) Was a tendency to steal caused by PTSD a disability?

2) Employment Appeal Tribunal upholds decision that Addison Lee drivers are ‘workers’

3) Non-disclosure agreements: Committee to examine wider issues

4) Dismissal before entitlement to benefit exhausted – Awan v ICTS

5) Government considering re-introducing Employment Tribunal Fees

In Wood v Durham County Council (UKEAT/0099/18), the Employment Appeal Tribunal had to decide whether the dismissal of an employee for shoplifting, which was caused by PTSD and associated amnesia, was disability discrimination.

Facts

Mr Wood was dismissed by Durham County Council after he left Boots the Chemist, without paying for items he had placed in his bag. It was not in dispute that what happened in Boots was the effective cause of his dismissal. Mr Wood challenged his dismissal as disability discrimination, asserting that he had PTSD and associated amnesia. He claimed the shoplifting and therefore his receipt of a fixed penalty notice was something arising from his disability.

It was eventually conceded by the Council, after production of medical reports, that Mr Wood had the mental impairment of PTSD and was therefore disabled. However, the Council relied on Regulation 4(1)(b) of the Equality Act (Disability) Regulations 2010 which states that a tendency to steal is an excluded condition. The tribunal ultimately decided that since the cause of the Claimant’s dismissal was the excluded condition, the claim must fail.

The EAT supported that decision. It agreed that a manifestation of the Claimant’s PTSD and disassociate amnesia was a tendency to steal within the meaning of Regulation 4(1)(b), which meant the claim (and the subsequent appeal) could not succeed.

Comment

The case is a reminder that certain conditions are expressly stated not to be impairments, and therefore do not meet the definition of disability under the Equality Act 2010. In addition to a ‘tendency to steal’, a ‘tendency to set fires’, addiction to alcohol and nicotine and exhibitionism are some examples of other excluded conditions.

Note to Employers – You should remember, that impairments (such as depression) caused by an excluded condition might amount to a disability. As such, dismissing an employee for any resulting impairment could give rise to a discrimination claim.

Furthermore, when dismissing in relation to an excluded condition, employers should also make it clear that they are not dismissing for any underlying impairment (e.g. PTSD in Mr Wood’s case). The County Council’s reason for dismissing Mr Wood was his criminal conduct outside of the workplace and the risk of reputational damage, not any underlying impairment.

Addison Lee has lost its claim at the EAT that its drivers were self-employed. The EAT ruling upheld a previous decision that the taxi and courier company’s drivers are workers and should therefore be paid the national minimum wage and holiday pay.

The decision follows a number of similar rulings against companies such as Uber and Hermes which held that drivers had ‘employee status’ and therefore basic employment rights.

In Addison Lee’s initial tribunal, the company claimed that, as self-employed contractors, its UK drivers chose their own hours so did not qualify for access to traditional employment benefits that those with “worker” or “employee” employment status would receive. In the judgment, the EAT rejected the company’s arguments that drivers were running their own businesses, pointing out their obligation to sign up to “unrealistic terms and conditions.”

The EAT judges also pointed out that Addison Lee provided induction, training and documentation (a Driver Operating Guide), while only one of their 4,000 workers was an owner driver – the rest “almost invariably hired a vehicle… in the Respondent’s livery”.

Note to Employers – The level of control or how ‘on brand’ a worker needs to be (in terms of uniform or equipment, for example) has been a recurrent theme in worker status cases.  Other key facts picked up in the recent case law on employment status include:

  • Whether a company is under an obligation to provide the individual with regular work and the individual is under an obligation to make themselves available to do the work.
  • If the individual is required to personally perform the services or if there is a right to substitution.
  • If the individual works exclusively for the company.
  • The length of the individual’s engagement with the company and if fixed regular pay is paid to the employee.

 

The Women and Equalities Committee launched an inquiry into Non-Disclosure Agreements to examine wider issues.

For the avoidance of doubt, NDAs are sometimes called confidentiality agreements and it is estimated that thousands of workers, who have been subjected to harassment, bullying and abuse, have been successfully silenced after being persuaded to sign NDAs, in return for a payoff.

Following the Committee’s report on sexual harassment in the workplace in July 2018, which recommended that the Government should clean up the use of NDAs in sexual harassment cases, an inquiry was launched to look at the wider use of NDAs in cases where any form of harassment or other discrimination is alleged. This might include, for example, pregnancy or maternity discrimination or racist abuse. Women and Equalities Committee Chair Maria Miller said:

“Use of NDAs in sexual harassment cases is only part of the picture. This new inquiry will focus on their wider use in other cases involving other forms of harassment or discrimination.”

Questions included, should the use of NDAs be banned or restricted in harassment and discrimination cases? What impact would this have on the way cases are handled? and, what safeguards are needed to prevent misuse? The deadline for responses was Wednesday 28 November 2018, watch this space…..

 

Mr Awan was employed by American Airlines. His contract of employment gave him the benefit of an insured long term disability benefit plan, entitlement to which would cease in the event of the termination of his employment.

Mr Awan suffered from depression went on sick leave, and he was subsequently dismissed on the grounds of capability.

The tribunal held that ICTS was not prevented from dismissing Mr Awan whilst he was entitled to receive benefits, and as a result his dismissal was fair. His dismissal was also a proportionate means of achieving a legitimate aim and therefore not discriminatory.

On appeal, the EAT disagreed and found it was contrary to the purpose of the long-term disability plan to allow ICTS to dismiss Mr Awan for ill-health capability  where income was being received by the employee from a long term disability plan/insurance scheme.  On the facts of the case, the EAT found it appropriate to imply a term into the employment contract preventing a dismissal where the employee is in receipt of income from a long term disability plan/insurance scheme.  The implied term operates to limit the express contractual right to terminate on notice if it means loss of income under the disability plan/scheme.  The EAT remitted the case to a fresh tribunal to address the questions of whether (taking into account the implied term) the dismissal was fair and whether it was a proportionate means of achieving a legitimate aim.  This will very likely prove difficult for the employer given the finding of the EAT.

Note to Employers – When dealing with long term ill health, always consider whether there are any policies or contractual terms applicable to the employee, which impact on your decision to dismiss. These include entitlements to sick pay, critical illness policies and permanent health insurance.   If contractual entitlements exist then the employer is at risk of claims of breach of contract, unfair dismissal and disability discrimination arising from any termination employment.

On 7 November 2018, it was reported in the Law Society Gazette that the government is considering reintroducing tribunal fees.  The article stated that the Ministry of Justice (MoJ) has confirmed it may reintroduce fees for employment tribunal claims, insisting it can find a balance that helps fund the court system while being ‘proportionate and progressive’.

Richard Heaton, permanent secretary at the MoJ, said that although nothing is set in stone he is confident a fee system can be found that will ensure access to justice.  The government was roundly criticised for its tribunal fee structure before a landmark 2017 Supreme Court judgment declared the fee scheme unlawful.

Tribunal fees were introduced in July 2013 by then Lord Chancellor Chris Grayling. They started at around £160, and increased to between £230 and £950 for further hearings. In certain circumstances claimants had to pay up to £1,200.

Answering questions from the House of Commons Justice Committee, Heaton noted that the judgment did not completely outlaw the concept of fees. ‘We have taken time over this,’ he said. ‘We have to get the fee level right. I can see a scheme working that is both progressive and allows people out of paying fees where they can’t afford to.’

He added that there are no immediate plans to reintroduce a fee scheme. ‘What we are not trying to do is squeeze as much income as we can out of every litigant,’ he insisted.

The MoJ is ‘doing all it can’ to ensure that everyone who paid a fee is refunded. In 2017/2018 refund payments totalled £7.1m. Since the end of the financial year April 2018 the MoJ has, on a cumulative basis, made refunds totalling £15.8m.

Watch this space….

If you would like further information on any of the above or advice on how they apply to your business then please contact Tom Evans, Senior Associate, Employment & HR Team.

Tom Evans Associate

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