Case Studies

Barely a day goes by without a court making a decision about something interesting. This is where we tell you about our favourites and those that we think you should know about.
  • 19/06/2017 Workers “prevented” from taking paid holiday can carry it over

    In King v The Sash Window Workshop Ltd, the Advocate General has held that workers who are not given paid holiday are to be treated as being prevented from taking it and can carry over their accrued holiday until they are given the right to take paid holiday or, failing that, receive payment for it when they leave. 

     

    NEWS

    In King v The Sash Window Workshop Ltd, the Advocate General has held that workers who are not given paid holiday are to be treated as being prevented from taking it and can carry over their accrued holiday until they are given the right to take paid holiday or, failing that, receive payment for it when they leave. 

     

    DETAILS

    In King v The Sash Window Workshop Ltd, Mr King was a salesman for Sash Window Workshop Ltd (“Sash Window”), paid entirely on commission for 13 years. He was categorised by Sash Window as self-employed and therefore, he was not paid for annual leave taken. Whilst he did take some unpaid holiday during the year, this was less than his statutory entitlement because he could not afford it. In 2008, he was offered an employee contract but this offer was turned down. He was dismissed from Sash Window after his 65th birthday.

    At the Employment Tribunal (“ET”), he claimed his accrued holiday pay for the current year, payment for his unpaid holiday pay for previous years and payment in lieu of untaken leave that he had accrued in previous years. At the ET, he won all three claims, and the ET saw no difference between a worker being unable to take paid leave due to sickness and a worker being denied paid leave.

    The Employment Appeal Tribunal (“EAT”) agreed with the Claimant that a worker may be able to claim for carried over holiday pay where a worker is unable or unwilling to take holiday for reasons which are beyond his control. This extended the decision in Larner (an earlier Court of Appeal (“CA”) decision) which enables holiday to be carried over due to long-term sick leave. 

    The CA made a reference to the Court of Justice of the European Union (“CJEU”) for a preliminary ruling on whether, where there is a dispute between an employer and a worker as to whether the worker is entitled to annual leave with pay, the worker has to take the leave first before establishing whether he is entitled to pay. Further, can annual leave be carried over where a worker is unable or unwilling to take leave which he would otherwise take if he was paid for it? 

    Advocate General Tanchev (“AG”) gave his opinion on the issues as follows:

    1. Employers are to provide “adequate facilities” to workers to exercise their right to take holiday e.g. a specific contractual term concerning paid annual leave. Workers should not be compelled to take legal action in order to establish this right.
    2. If a worker does not take all or some of the annual leave to which he is entitled in the leave year, where he would have done so if the employer had paid him for it, then the worker is being “prevented” from taking his paid leave and he can carry over this right until he is given the facility to take the paid leave, or he leaves his employment, whichever is earliest. 
    3. On termination, a worker is entitled to a payment in lieu of annual leave that has not been taken for the whole of his employment. Only once the worker has been given the facility to take paid leave, can the national restrictions on claims be applied.
    4. A worker does not have to take leave first before being able to establish whether he is entitled to be paid for it. 

    COMMENT 

    Alex Payton comments: “Whilst the Advocate General’s opinion is not binding on the CJEU, if it is accepted, then this case establishes that a worker can claim holiday pay without trying to take leave if it is clear they do not get paid holiday.  Such payment could be for the whole of their employment.  This is different to a situation where a worker takes holiday and is not paid for it.  In that case, a claim would need to be brought within 3 months.” 

    If you require further assistance, please contact a member of the team.

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    Advocate General: workers’ “prevented” from taking paid holiday leave can carry it over
  • 13/06/2017 Father directly discriminated against by employer’s shared parental pay policy

    In Ali v Capita Customer Management Limited a new father succeeded in his direct sex discrimination claim against his employer when he was only entitled to two weeks’ full pay paternity leave followed by shared parental leave at statutory pay, whereas his equivalent female comparator was entitled to 14 weeks’ enhanced maternity leave on full pay.

    NEWS

    In Ali v Capita Customer Management Limited a new father succeeded in his direct sex discrimination claim against his employer when he was only entitled to two weeks’ full pay paternity leave followed by shared parental leave at statutory pay, whereas his equivalent female comparator was entitled to 14 weeks’ enhanced maternity leave on full pay.

    DETAILS

    In Ali v Capita Customer Management Limited, Mr Ali’s employment had transferred from Telefonica to Capita under TUPE in 2013 and Telefonica’s policies transferred with him. Under these policies, female employees were entitled to enhanced maternity pay as they were given 14 weeks’ enhanced maternity pay, followed by 25 weeks at the statutory rate. Male employees were entitled to two weeks paternity leave on full pay. 

    Mr Ali had a baby with his wife on 5 February 2016, and took his two weeks paid paternity leave immediately after the birth. Following this, he took some annual leave. During his paternity leave, Mr Ali’s wife was diagnosed with post-natal depression and was medically advised that returning to work would assist her recovery. On Mr Ali’s return to work, Capita informed him that he was able to take shared parental leave but he would only be entitled to statutory pay. Mr Ali claimed direct sex discrimination and victimisation at the Employment Tribunal (“ET”). 

    Mr Ali accepted that the two weeks immediately following the birth are compulsory for women to enable them to recovery from childbirth; however, in the subsequent 12 week period when he wanted to care for his baby, he was denied the benefit of full pay and deterred from taking leave. He argued that male employees should be given the same right to enhanced pay, and after the two weeks compulsory leave, either parent could care for their baby depending on the choices made by the parents and their particular circumstances. This policy took away the choice he and his wife wanted to make as parents for their baby, and this was not a valid assumption to make in 2016.

    The ET upheld Mr Ali’s claim of direct discrimination and victimisation. It held that it was not clear why any exclusivity should apply beyond the two week compulsory period, and parents should be free to make a choice free of “generalised assumptions” that the mother is always best placed to undertake the greater role in caring for their babies.

    In these particular circumstances, because Mr Ali’s wife was suffering from post-natal depression, he was best placed to play the greater role in caring for their baby. However, he was deterred from taking on this role because of pay, for which his female comparator would have received full pay. As such, this was directly discriminatory against male employees.

    COMMENT

    Paula Bailey comments "This case is only the third case dealing with the enhancement of shared parental pay, and all decisions so far have been at first instance. An appeal decision is needed as soon as possible to settle the uncertainty in this area. It has been reported that Capita will appeal this decision; so, watch this space."

    If you require further assistance, please contact a member of the team.

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    Father directly discriminated against by employer’s Shared Parental Pay Policy
  • 12/06/2017 Employees not under a duty to disclose plans to set up in competition

    In MPT Group Ltd v Peel & ors the High Court confirmed that an employee’s duty of good faith did not extend to an obligation on employees to disclose their intention to lawfully compete with their employer. 

    NEWS

    In MPT Group Ltd v Peel & ors the High Court confirmed that an employee’s duty of good faith did not extend to an obligation on employees to disclose their intention to lawfully compete with their employer. 

    DETAILS

    In MPT Group Ltd v Peel & ors, MPT sought injunctive relief against two former employees, Mr Peel and Mr Birtwistle, who had set up a business designing, producing, supplying and installing mattress machinery, in direct competition with MPT.  

    In support of its application for an interim injunction MPT alleged that Mr Peel and Mr Birtwistle had misused MPT’s confidential information, infringed its database and copyright and wrongly conspired to use unlawful means with the intention of injuring MPT.  In addition, MPT alleged that Mr Peel and Mr Birwistle had given untruthful answers to straight questions about their future plans prior to their departure. This, MPT argued, was a breach of the duty of good faith.

    However, the High Court took a different view, stating that Mr Peel and Mr Birtwistle were not under a duty to disclose their true intentions to MPT.  Whilst clarifying that the law will step in to prevent unlawful competition or to hold employees to enforceable restrictive covenants or to protect confidential information, the High Court was ‘reluctant’ to hold that the failure by a departing employee to disclose their own confidential and nascent plans to set up in lawful competition amounted to a breach of the duty of good faith.

    COMMENT

    Hannah Pryce comments: “Although it is somewhat surprising that the Court decided in this case that the employees’ contractual obligation to serve their employer with good faith and fidelity did not extend to a duty to disclose their plans to set up in competition, the decision could have been different had the employees also been directors of the company as they would have owed a fiduciary duty to act in the best interests of their employer”.  

    For further information or assistance with any of the matters discussed above please contact a member of the team

    © Howes Percival LLP

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  • 05/06/2017 Disability related absence was not cause of redundancy dismissal

    In Charlesworth v Dransfields Engineering Services Ltd the EAT held that the Claimant’s absence from work due to a disability was not an operative cause of his dismissal by reason of redundancy. 

    NEWS

    In Charlesworth v Dransfields Engineering Services Ltd the EAT held that the Claimant’s absence from work due to a disability was not an operative cause of his dismissal by reason of redundancy. His absence had merely allowed the Respondent to identify its ability to manage without him. As a result, the EAT rejected the Claimant’s claim of discrimination arising from disability.

    DETAILS

    In this case, the Respondent was not achieving the profitability that management desired and was on the lookout to make cost savings from 2012 onwards. In October 2014, the Claimant went into hospital for an operation for renal cancer and was absent from work for two months.  During his absence, the Respondent identified the opportunity to save around £40,000 by getting rid of his position as Manager of the Respondent’s Rotherham branch and absorbing his responsibilities into other roles.  The Claimant was notified of his potential redundancy in March 2015, and engaged in consultation with the Respondent.  However, no suitable alternative vacancy could be identified. The Claimant brought claims against the Respondent for unfair dismissal, direct disability discrimination and discrimination because of something arising in consequence of disability.

    The Employment Tribunal rejected the claims.  With regards to discrimination because of something arising in consequence of disability pursuant to section 15 of the Equality Act 2010, it noted that there was some link between the Claimant’s absence and his dismissal because his absence gave the Respondent an opportunity to identify that it could manage without him. However, the Tribunal considered that this was not the same as saying that the Claimant was dismissed because of his absence. In its view, the Claimant’s absence was not an effective or operative cause of his dismissal.  The Claimant appealed.

    The Employment Appeal Tribunal (“EAT”) dismissed the Claimant’s appeal finding that under section 15 there must be something arising in consequence of the disability and the unfavourable treatment must be ‘because of’ that ‘something’. Whilst the EAT felt that the words "arising in consequence of" may give some scope for a wider causal connection than the words "because of", it rejected the Claimant’s argument that something less than an operative cause or influence is sufficient to satisfy the causation test. A significant influence is required rather than a mere influence. On that basis, the Employment Tribunal was correct in concluding that the Claimant’s absence was merely how the Respondent realised that it was able to manage without the Claimant; it was not the cause of his dismissal.

    COMMENT

    Graham Irons comments: “This case deals with a familiar scenario of an employer finding that it can make do without an employee after a period of absence.  A critical finding here was that the employer had already been ‘on the lookout’ for ways to make costs savings. Had this not been the case, the outcome may well have been different.

    For further information or assistance with any of the matters discussed above please contact a member of the team

    © Howes Percival LLP

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  • 17/05/2017 Three month gap will break “series” of deductions in holiday pay case

    In Fulton and anor v Bear Scotland Limited, the EAT has confirmed that where there is a gap of more than three months between non-payments or underpayments of wages then this breaks the series of deductions for the purpose of bringing an unlawful deduction of wages claim. 

    NEWS

    In Fulton and anor v Bear Scotland Limited, the EAT has confirmed that where there is a gap of more than three months between non-payments or underpayments of wages then this breaks the series of deductions for the purpose of bringing an unlawful deduction of wages claim. 

    DETAILS

    This appeal concerned a long-standing dispute over holiday pay.  An earlier EAT decision held that payments in respect of non-guaranteed overtime must be taken into account when calculating holiday pay under the Working Time Directive.  It also decided that, when bringing an unlawful deduction of wages claim, a gap of more than three months between deductions breaks the ‘series’ of deductions.  In a “deduction from wages” claim underpayments for any period can be claimed as long as the last in the “series” of deductions is within 3 months of a claim being submitted. Therefore the effect of the EAT’s ruling was to reduce the amount of back pay that can be claimed in holiday pay cases.  The case was sent back to the Tribunal to apply this to determine the amount of underpaid holiday pay due.

    When the case was re-heard at the Tribunal, it concluded that it was bound by the EAT’s decision and excluded all claims where a period of more than three months had elapsed between successive non or underpayments of holiday pay.  The Claimants appealed to the EAT and argued that this part of the EAT’s previous decision was not binding and the presumption that a three month gap breaks a series of deductions was not an absolute rule.

    The EAT rejected the appeal and held that their previous decision was binding precedent and they could not depart from it.  The EAT also confirmed that a three month gap in underpayments did create an absolute rule (rather than just a presumption) that a series of deductions would be broken. 

    COMMENT

    Matthew Potter comments: "This decision will be welcomed by employers facing claims under the Working Time Directive where they have failed to factor overtime into holiday pay.  It confirms that an employer will be able to avoid or reduce back pay claims if they have made payment of the correct holiday pay for three months or more (which may be the case for holiday paid beyond the 20 days under the WTD)."   

    For further information or assistance with any of the matters discussed above please contact a member of the team

    © Howes Percival LLP

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  • 12/05/2017 Psychometric Testing and Discrimination

    In the Government Legal Service v Brookes the EAT has confirmed the earlier decision of the Employment Tribunal, that a candidate required to carry out a psychometric test as part of a recruitment process, was placed at a particular disadvantage because she had Asperger’s syndrome.

    NEWS

    In the Government Legal Service v Brookes the EAT has confirmed the earlier decision of the Employment Tribunal, that a candidate required to carry out a psychometric test as part of a recruitment process, was placed at a particular disadvantage because she had Asperger’s syndrome.

    DETAILS

    In the Government Legal Service v Brookes, Ms Brookes (who has Asperger’s syndrome) applied for a position as a lawyer in the Government Legal Service.  As part of a process, which the EAT described as “fiendishly competitive”, Ms Brookes was required to undertake a multiple choice situational judgment test (SJT). Ms Brookes argued ahead of taking the test that she should have been allowed to answer the questions in the SJT in the form of short narrative written answers rather than by virtue of multiple choice answers where such answers to the questions were either objectively right or wrong with no room for subjective consideration by the examiner or marker.  Ms Brookes was unsuccessful with her application to the Government Legal Service and brought claim of indirect discrimination (Section 19 of the Equality Act 2010) and of discrimination by failure to make the reasonable adjustment (Section 20).

    The pass mark for the SJT was 14 and Ms Brookes achieved a pass mark of 12. The Employment Tribunal found Ms Brookes to be an “intelligent, resourceful and capable” candidate and clearly committed to a career in the Government Legal Service and when she came so close to reaching the required mark of 14, the Tribunal was at liberty to ask why she had not passed, and was entitled to find that likely explanation could be found in the fact that Ms Brookes had Asperger’s syndrome and the difficulty that condition would place her under whilst taking a multiple choice format test. (As an interesting aside, Ms Brookes at both first instance and in the EAT gave evidence on her own behalf, represented herself in the Employment Tribunal and in turn represented herself in the Employment Appeal Tribunal).

    The Employment Tribunal found that the Respondent had indirectly discriminated against Ms Brookes and that they had failed to comply with the duty to make reasonable adjustments and had treated her unfavourably because of her disability.

    At the Employment Tribunal it was accepted by the Government Legal Service that Asperger’s syndrome was a disability at the relevant time and that the provision, criterion or practice (PCP) was also agreed, namely a requirement for all applicants in the trainee recruitment scheme to take and pass the online SJT.

    The Employment Tribunal considered the question of whether the PCP put people such as Ms Brookes “as a group” at a disadvantage compared to those who did not have Asperger’s syndrome and concluded that it did. There was no challenge to that by the Government Legal Service but the Employment Tribunal went on to find that the PCP put Ms Brookes specifically at a disadvantage. That finding was challenged in the EAT. 

    The Tribunal also considered the question of justification and concluded that while the PCP served a legitimate aim, (their aim being that the SJT was there to test a fundamental competency required of trainees entering into the Government Legal Service, the requirements of which included the ability to make effective decisions) then the SJT as a means for achieving that aim was not proportionate to it. For that reason the complaint of indirect discrimination succeeded in the Employment Tribunal as did the claim for discrimination arising from the failure to make reasonable adjustments. The above reasoning adopted by the Tribunal was described by the EAT as “impeccable and beyond reproach”.

    As stated above the EAT considered that the reasoning of the Employment Tribunal in the first instance was “cogent and properly supported of the conclusion it reached” and as a result the Employment Tribunal was entitled to conclude that the PCP placed Ms Brookes at a particular disadvantage because of her Asperger’s syndrome. 

    What is important to this case is the fact that there was substantial medical evidence raised before the Employment Tribunal that Ms Brookes had earlier employed the services of a psychiatrist who had treated her since her university days and had previously made recommendations to Ms Brookes University that a multiple choice format test would not be appropriate for her. Ms Brookes had also referred to this prior to being required to embark on the psychometric testing with the Government Legal Service.  The EAT found that psychometric testing was not the only way to achieve the competency of a candidate especially in these circumstances where a candidate was medically diagnosed with Asperger’s syndrome and where medical evidence clearly showed that the candidate was placed at a disadvantage.  The “legitimate aim” sought by the Government Legal Service was test competency and the EAT found that the requirement of the Government Legal Service for this particular employee to complete the SJT and pass with a score over 14 did not serve a legitimate aim.  It was therefore deemed that the requirement was not proportionate in regards to achieving the aim required, namely test competency.

    COMMENT

    Simon deMaid comments: "This case raises a number of issues regarding selection in interview processes for candidates who may be affected by a condition recognised (as a disability) under the Equality Act.  It also highlights the need for employers to review processes for internal promotion and assessment for employees similarly diagnosed with medical conditions that may place them at a disadvantage."

    For further information or assistance with any of the matters discussed above please contact a member of the team

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