Daniel Barnett's Latest - April 27

Tribunal Bias
21 April 2006
This case is an example of a tribunal decision being set aside
because of apparent bias (i.e. where the fair minded and informed
observer present at the hearing, not being a party or associated
with a party, having considered the facts, would consider that
there was a real possibility that the tribunal was biased).
An employment tribunal chair, at the outset of a case, said to the
employer's representative (who was not a legal representative)
that it "may be in some difficulties in maintaining that the
claimant was dismissed by reason of her conduct as it appeared
from the [documents] lodged by the [employer] that there was no
indication that the reason for the [employee's] dismissal was her
conduct."
As a result of that indication, the employer conceded that the
dismissal was unfair (a position it had previously challenged). It
then appealed.
The EAT (Lady Smith presiding) noted that the representative, also
at the EAT, "was anxious, not confident and it was easy to
envisage that he would have been vulnerable to pressure".
Against that impression of the representative, and the fact that
the chairman had not expressly said "This is only a preliminary
view and we are open to persuasion", the EAT considered the test
for apparent bias was made out. Accordingly it set aside the
finding of unfair dismissal and allowed the employer to withdraw
its concession.
Chris Project v Hutt
BAILII Judgment

TUPE and the Vanishing Dismissal
20 April 2006
The EAT (HHJ Peter Clark sitting alone) has held that TUPE 1981
operates so that, when employees are dismissed for misconduct
before a TUPE transfer, but are reinstated after the date of
transfer by the transferor, the dismissal 'vanishes' and the
employees are deemed to have been transferred under TUPE.
In other words, despite having been dismissed at the date of the
transfer, they are deemed (if the appeal is successful) to have
been employed "immediately before" the transfer.
In reaching that conclusion, the EAT relied on previous decisions
of the EAT and Court of Appeal where a dismissal was held to have
'vanished' following a successful appeal, for example for the
purpose of deciding whether an employee had continuity of
employment for claiming unfair dismissal.
G4S Justice Services v Anstey & Simpson
BAILII Judgment

Bank Holiday Mondays / Part-Time Workers
19 April 2006
The EAT has considered, in a case with slightly unusual facts, the
difficult question of whether part-time employees who do not work
on Mondays are entitled to a pro rata apportionment of extra time
off in respect of Bank Holidays which always fall on a Monday.
Four of the UK's eight bank holidays always fall on Monday (Easter
Monday, May Day, Spring Bank Holiday and August Bank Holiday). One
is always on a Friday (Good Friday) and the other three vary. For
some time, there has been debate about whether the Part Time
Workers (Prevention of Less Favourable Treatment) Regulation 2000
prohibit an employer from allowing a full-time worker time off for
Monday Bank Holidays, when part-timers who do not work Mondays do
not receive time off.
The Claimant in this case worked Wednesdays, Thursdays and
Fridays. The employer, Capita Business Services, operates seven
days a week. The tribunal found that the part-time Claimant
suffered a detriment compared with full-time workers, in that he
did not receive the benefit of Monday bank holidays. However, it
found the reason was not his status as a part-time worker, but
simply because he did not work Mondays. Accordingly his claim was
dismissed.
The Employment Appeal Tribunal upheld the tribunal's decision. It
placed considerable emphasis on the fact that the Respondent
operated a seven-day a week business, and that full-timers who
worked five days a week excluding Mondays also did not receive
time off for those Bank Holidays.
This decision provides some support for employers who do not give
part-time workers additional pro rata time off in respect of bank
holidays. However:
* it remains to be seen whether the same approach would be taken
with a five-day (rather than seven-day) a week business, where ALL
full timers receive the benefit of bank holidays;
* the case did not deal with justification (as it was not
necessary to do so). It is strongly arguable that an employer
would be justified in restricting the benefit of time off for Bank
Holidays to people who actually work on those days, even if doing
so has a detrimental impact on part-time workers.
McMenemy v Capita Business Services Ltd
BAILII Judgment

Statutory Dismissal Procedures

Reversal of Polkey
16 April 2006
Last week, [see below], I reported Alexander & Hatherley v Bridgen
Enterprises, in which the EAT (Elias P. presiding) considered
s98A(2) of the Employment Rights Act 1996. This section, which
partially reverses Polkey, provides:
"98A(2) Subject to subsection (1) [compliance with the statutory
minimum dismissal procedure], failure by an employer to follow a
procedure in relation to the dismissal of an employee shall not be
regarded for the purposes of section 98(4)(a) as by itself making
the employer's action unreasonable if he shows that he would have
decided to dismiss the employee if he had followed the procedure."
In Alexander & Hatherley v Bridgen Enterprises, Elias P. held that
s98A(2) enables employers to avoid a finding of unfair dismissal
in respect of any breaches of what might otherwise be regarded as
a 'fair' procedure, when the employer could establish that the
'fair' procedure would not have saved the employee from dismissal.
On the same day last week, another division of the EAT (HHJ
McMullen presiding) handed down a decision holding almost
precisely the opposite - see Mason v Ward End Primary School.
HHJ McMullen holds that s98A(2) only rescues employers when the
procedural breach amounts to breach of a formal procedure - either
one that is written down, or one which has arisen through custom
and practice. However, he considers it does not extend to more
general breaches of a 'fair' procedure, such as those envisaged by
the Acas Code of Practice.
In reaching this decision, HHJ McMullen repeats his views (far
more briefly expressed) in Pudney v Network Rail last month, which
were regarded by Elias P. at para. 56 of Alexander & Hatherley v
Bridgen Enterprises as wrong. However, in this more recent case,
HHJ McMullen has set out full reasoning for his conclusion, rather
than just asserted a principle.
Thus we are left with two inconsistent - and both, well-reasoned -
decisions of the EAT on a very important point of interpretation
of s98A(2). As I understand it, neither case is being appealed to
the Court of Appeal.
Mason v Ward End Primary School
EAT Judgment
 
Statutory Dismissal Procedures
13 April 2006
The EAT (Elias P. presiding) has handed down an important decision
on the impact of the statutory dismissal procedures. It is
authority for the proposition that:
* in a redundancy situation, the statutory dismissal procedure
requires an employer to tell an employee of the reason for the
redundancy, the selection criteria, his score, but NOT the
threshold (ie the 'break' score beyond which his job is safe) or
the scores of other employees. Failure to provide this information
renders the dismissal automatically unfair and leads to an
increase in the compensatory award
* s98A(2), which partially reverses Polkey v AE Dayton Services,
has a wide-ranging effect and cannot be narrowly construed to
rescue only employers who fail to comply with formal written
procedures over and above the statutory minimum.
The employer was making nine compulsory redundancies. It used a
matrix system to provisionally select the employees, and held two
meetings with them. At the first meeting, they were told the
selection criteria but not their personal scores. It was only at
the end of the second meeting, after the decision to dismiss had
ben taken, that they were told their scores. An appeal was
offered, but was held by the employment tribunal to be defective.
The Employment Appeal Tribunal held that the statutory dismissal
procedure:
* does not require detailed information to be given in writing at
step 1. It is only necessary to set out the reason for the
dismissal in broad terms, such as 'redundancy', or 'incapability'.
In a conduct case, this will be identifying the nature of the
misconduct such as 'fighting', 'insubordination' or 'dishonesty'
(para. 38)
* at step 2, the employer must inform the employee of the basis
for the grounds for dismissal - but this need not be in writing.
It must, though, give the employee sufficient detail of the case
against him to allow him to properly put his side of the story
(para. 39)
* in redundancy dismissals, where a matrix system is used, this
requires that the employee be told the selection criteria (para.
43) and the scores he has achieved (para. 45). It does not require
that the employee be told the threshold score he must achieve to
remain in employment, or the scores of other employees (para 46).
Accordingly, because the employer had not provided the individual
scores until the decision to dismiss had been taken, it was in
breach of the statutory dismissal procedure and the dismissals
were automatically unfair.
The Employment Appeal Tribunal went on to deal with the employer's
alternative argument that a lack of fairness under s98(4) did not
matter, because (assuming the employer had complied with the
statutory minimum procedure - which the EAT found it had not) the
effect of s98A(2) is to provide an escape route for employers who
comply with the statutory minimum procedure but make other
procedural errors, provided that the employer can establish that
complying with that procedure would still have resulted in
dismissal. The EAT held:
* it is inappropriate to draw a distinction between 'procedural'
and 'subtsantive' defects in the employer's actions (paras 55-56)
* if an employer fails to comply with any procedure which a
tribunal feels it ought, in fairness, to have carried out, it is
able to avail itself of the new statutory defence in s98A(2). This
is not limited to formal procedures, whether written down or not.
If the employer's actions are fundamental, then it is likely there
will be a breach of the statutory dismissal procedures anyway, in
which case s98A(2) does not assist (paras. 56-57)
* thus, where the statutory dismissal procedures are followed:
o any procedural failings where the chance of dismissal (had the
procedures been complied with) is more than 50% will be ignored,
and the dismissal will be fair; and,
o any procedural failings where the chance of dismissal (had the
procedures been complied with) is less than 50% will continue to
be governed by Polkey, so that the dismissal will be unfair but
compensation will be reduced to reflect the chance of dismissal
(obviously, by less than 50%) (para. 58)
I understand that a different division of the EAT handed down a
decision yesterday reaching precisely the opposite conclusion on
the scope of s98A(2), i.e. that it only applied to breaches of
formal procedures but not to more general concepts of unfairness
(such as failure to comply with the Acas code). I will send out a
further bulletin on this point when this other case appears on the
EAT website.
Alexander & Hatherley v Bridgen Enterprises
EAT Judgment

Minimum Wage - Gas & Electricity
13 April 2006
The EAT (Elias P.) has handed down an important decision dealing
with the national minimum wage legislation.
The employer (part of the Butlins group) supplied accommodation to
employees working at holiday camps. As part of the arrangements, the
employees consented to a deduction of 6 GBP per fortnight as a
contribution towards the cost of gas and electricity.
If this 6 GBP per fortnight could be counted as part of the
employees' wages, then the employer complied with the minimum wage
legislation. However, if it had to be deducted when calculating the
wage paid, then the employees received less than the minimum wage.
In an extremely complex judgment (due to the convoluted provisions
of the National Minimum Wages Regulations 1999), the EAT held that
the payment for gas and electricity was part of the provision of
living accommodation (in respect of which the employer had already
taken advantage of the maximum allowance) and, in the alternative,
that the deduction was for the employer's own use and benefit.
Accordingly, the employer could not count the 6 GBP per fortnight
towards the employees' wages, and was thus in breach of the national
minimum wage legislation.
For those litigating or advising on minimum wage issues, this
judgment is a compulsory read. For others, steer well clear
without the proverbial wet towel.
HM Revenue & Customs v Leisure Employment Services Ltd
EAT Judgment
 
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