Following Labour’s election victory, we can expect some big changes to employment law. We covered their proposals in last month’s employment law update and they have pledged to bring in most of these within their first 100 days in office. Employers will need to prepare for these changes, and ensuring their employment contracts are up to date and that they provide as much protection as possible should be their first step.
Thanks to the election campaign there were no legislative changes in June, however developments in case law continued. We’ve summarised the most significant decisions below.
Case Law Update 📢
Taylors Poultry Services v HMRC – this case resulted from an HMRC investigation into the employer not paying the minimum wage. The employer had a number of zero-hours workers that were employed to work on poultry farms. The employer collected its workers directly from home in a minibus and drove them to their various assignments, and at the end of the day dropped them back off at home. The employer paid the minimum wage at the correct hourly rate, but this wasn’t the issue – HMRC decided that the workers should be paid the minimum wage during their (sometimes long) journeys to and from work. Seeing as the employer had not done this, HMRC issued the employer with ‘notices of underpayment’, requiring the employer to re-imburse the employees for the underpayments and to pay a penalty.
HMRC appealed the notices to the Employment Tribunal, but the Tribunal agreed with HMRC that the employees had been underpaid. However, the Employment Appeal Tribunal upheld the employer’s appeal and decided that the workers were not entitled to the minimum wage during their travel on the minibus.
The case is a reminder that minimum wage legislation is notoriously complex and that employers can find themselves in breach of the rules despite paying the correct hourly rates. Because of the legal technicalities, the decision rested on the fact that the workers were collected from home. If the employer had required the workers to come to its premises first and then had driven them to their first job from there, the minimum wage would have been payable for the time spent on the minibus. Employers can be fined and ‘named and shamed’ for falling foul of the rules, so they should always take advice to ensure they are compliant with the legislation.
Ballerino v Racecourse Association – the Claimant employee in this case was dismissed during her maternity leave, ostensibly on the grounds of redundancy. Her job title was ‘Financial Accountant’, but, during her maternity leave, her employer created a new role entitled ‘Finance Manager and Business Analyst’. The new role incorporated the employee’s previous duties as Financial Accountant but also included other, wider responsibilities. An external candidate was appointed to the new role and the Claimant was dismissed by reason of redundancy. She claimed that the redundancy was a sham and that she suffered less favourable treatment because of her sex and/or because of the pregnancy and maternity
At first, the Claimant lost her claim for pregnancy discrimination in the Tribunal. However, she successfully appealed, on the grounds that the Tribunal should have asked itself whether the statutory definition of ‘redundancy’ applied in her case. Under the statutory definition, broadly speaking a redundancy situation exists where a place of work is closing, or where the employer’s requirement for employees’ work has either ceased or diminished. It was difficult to see how that definition applied here as the requirement for the employee’s work hadn’t diminished, it had simply been moved into a different role. The Appeal Tribunal remitted the case back to the Employment Tribunal to apply the statutory test.
As appears to have happened here, where employers reorganise how work is done within the business but without that workload diminishing, that may not create a redundancy situation. Particular care should be taken in these situations to avoid claims for unfair dismissal.
NSL Ltd v Zaluski – Cases dating back from the Covid-19 pandemic are still making their way through the Tribunal system, as this one demonstrates. The employer had a policy of making its staff responsible for ensuring that any periods of annual leave factored in any periods of required quarantine, and that if employees did not return from holiday on time, that could be classed as gross misconduct. The Claimant had travelled back to Poland to deal with his late father’s affairs but unexpectedly had to quarantine when he arrived there. He requested an extension to his leave as he required more time to deal with his family affairs, which the employer refused. He overstayed his leave and on returning to work, he was giving a final written warning.
The Tribunal found that this amounted to indirect discrimination, as the employer’s policies put non-British employees at a disadvantage and were not justified. The Appeal Tribunal allowed the employer’s appeal on the justification point, holding that the Tribunal had focussed too heavily on how the policy had impacted the Claimant, rather than considering (as it should have) how the policies affected non-British employees as a whole. That was an error, and the case was remitted back to the Tribunal to consider the employer’s justification defence again.
Indirect discrimination is another complex area, and employers should ensure that, if they have any policies or rules that disadvantage certain groups, those policies can be justified.
News 📰
The Home Office has published an updated "Employer's guide to right to work checks", which can be found here.
The update confirms that employers are no longer required to repeat their checks on employees with ‘pre-settled’ status under the EU settlement scheme, and that these checks are now only required before employment starts. The guidance also gives more information about biometric residence permits with eVisas, and when follow-up checks are required for holders of these.
Thank you to our contributors: Phil Cookson, Desley Sherwin, Laura Hill and George Miller.