Management Attendance Policies and Disability

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1 Employment Law SPRING 2016 Management Attendance Policies and Disability The Court of Appeal (in Griffiths v Secretary of State for Work and Pensions [2015] EWCA Civ 1265) has decided that the employer s duty to make reasonable adjustments for disabled employees does apply to attendance management policies. Duty to make reasonable adjustments It was held that the duty to make reasonable adjustments under S 20 of the Equality Act 2010, could apply to an absent management policy notwithstanding that it was applied equally to all employees. This is because the provision, criterion or practice complained of in such a claim is the requirement to maintain a certain level of attendance at work, which inevitably would cause a substantial disadvantage for disabled employees who are likely to have more sickness related absence than non-disabled employees. This overrules the decision of the Employment Appeal Tribunal in Royal Bank of Scotland v Ashton [2011] ICR 632. However it was confirmed that the employer s duty to make adjustments to the point at which a sanction may apply for prolonged periods of absence is extremely limited. As a result it is very unlikely that an employee will be able to successfully show that it is reasonable for an employer to discount all disability related absence which would otherwise attract a sanction under the policy. There is also no obvious period by which to extend the point at which sanctions may apply if it is anticipated that the disabled employee is likely to be absent for lengthy periods in the future. Elias LJ noted that to increase the period further will not in practice remove the disadvantage if the employee is likely to have further absence in the future. Therefore it will only be reasonable for an employer to adjust a policy to accommodate the absence of a disabled worker if they had a short period of absence and any future absence is likely to be minimal. Any further increase of this period is unlikely to be considered a reasonable adjustment which the employer can make to avoid the disadvantage. Even where there is no duty to make reasonable adjustments, the employee may still be able to bring a claim for disability discrimination if they are dismissed or given a warning by reason of disability related absence. This is due to the protection afforded by S 15 of Equality Act 2010 which prohibits discrimination arising from a disability. An employee who has been treated unfavorably because of something arising in consequence of a disability e.g. they have received a warning or have been dismissed for disability related absence is likely to have more success under s 15 (discrimination arising from a disability) than under s 20 (the duty to make reasonable adjustments). The employer would be required to show that any disciplinary action arising from disability absence was a proportionate response to the level of past and expected absence. The onus is on the employer to justify any unfavorable treatment.

2 Unfair Dismissal Overview and Recent Decisions on Inconsistent Treatment and the Limits of the Band of Reasonable Responses The test for unfair dismissal In deciding whether an employer s decision to dismiss is fair the tribunal will consider whether the employer s action fell within the band or range of reasonable responses, a test which was first established by case law over 30 years ago. The test ensures that any tribunal looking at an employer s decision to dismiss does so objectively i.e. they do not attempt to substitute the employer s decision with their own view on whether the dismissal is fair. When an employee is dismissed the employer must show that the principal reason for the dismissal falls within one of the potentially fair reasons to dismiss as defined in S 98 of the Employment Rights Act 1996 which are: Conduct Qualifications / Capability Redundancy Statutory Ban Other substantial reason It cannot be for a reason relating to maternity pay or leave, for example, as a dismissal for this reason would be automatically unfair. Once an employer has established the principal reason for the dismissal a tribunal will consider whether it was reasonable to dismiss the employee for that reason. This will involve a consideration of the band of reasonable responses available to the employer. When is a decision to dismiss likely to be fair and reasonable? It is important that a reasonable investigation is undertaken into any alleged misconduct. It is likely that if this is not done, regardless of the reason for the dismissal, the decision to dismiss will be unfair as a proper and fair procedure has not been followed. In conduct cases an employer must show that they had reasonable grounds for the belief in the employee s culpability at the time of dismissal (British Home Stores Ltd v Burchell [1978] IRLR 379). In order to satisfy a tribunal that a belief is reasonably held it would be necessary to undertake an investigation. The ACAS Code of Practice on Disciplinary and Grievance Procedures contains key steps in the investigation process and should be followed as a minimum when investigating alleged misconduct. A tribunal may award an increase in compensation of up to 25% where the ACAS Code has not been reasonably followed (under S 207 of the Trade Union and Labour Relations (Consolidation) Act 1992). The reasonableness of the decision to dismiss is considered in light of what the employer knew - or ought to have known - at the time of taking the decision to dismiss. An employee must

3 MANAGEMENT ATTENDANCE POLICIES be given full details of the allegations against them and an opportunity put their version of events to the employer which the employer must take into consideration, when making the decision whether or not to dismiss. The Band of Reasonable Responses......as it applies to the whole process As mentioned above, in judging the reasonableness of the employer s conduct, an Employment Tribunal must not substitute its view for that of the employer, but consider a band of reasonable responses which a reasonable employer may adopt in response to an employees alleged misconduct. It was reiterated in the case' of MBNA Limited v Jones UKEAT/0120/15/MC that the band of reasonable responses is considered in relation to all aspects of the employer s decision to dismiss including Dismissing an employee will involve a consideration of the band of reasonable responses.

4 ...as it applies in cases of alleged inconsistency and other factors to be taken into account the investigation, the process and the sanction imposed. In the case of MBNA v Jones the Employment Appeal Tribunal overturned the decision of the employment judge that the dismissal was unfair due to inconsistent treatment. The Employment Appeal Tribunal clarified that inconsistent treatment will only be relevant to the reasonableness of the decision when incidents involving two employees are truly parallel. Other than in those narrow circumstances, the focus should be on the reasonableness of the decision to dismiss a particular employee, and not on the treatment afforded to another. Judge David Richardson in handing down his judgement noted, If it was reasonable for the employer to dismiss the employee whose case the ET is considering, the mere fact that the employer was unduly lenient to another employee is neither here nor there. The application of the band of reasonable responses was also considered by the Court of Appeal in the matter of Newbound v Thames Water Utilities Ltd [2015] EWCA Civ 677. The Court upheld the Employment Tribunal s decision that an employee was unfairly dismissed for inspecting a sewer without wearing breathing apparatus in breach of safety requirements set out in a safe system of work document. The Employment Tribunal had found that the employee had not had adequate training on this and that he was following a practice that had been condoned for some time. The Court held that the employment judge was entitled to conclude that no reasonable employer would have dismissed the claimant in all the circumstances and to take into account an individual s length of service for the purpose of assessing the reasonableness of a decision to dismiss. The weight to be afforded to such a factor is not a matter for the employer, contrary to the view accepted by the Employment Appeal Tribunal in its decision, as this would be an attempt to stretch the band of reasonable responses to an infinite width. The Court also found that, in the alternative, the employment judge had been entitled to find the dismissal unfair based on the disparity in treatment in that the manager in charge had allowed the claimant to enter the sewer without breathing apparatus but had only been given a warning. Lord Justice Bean said, I have rarely seen such an obvious case of unjustified disparity. For further advice on all aspects of Unfair Dismissal please do not hesitate to get in touch with your Union or, if you are not a Union member with our Employment Team.

5 MANAGEMENT ATTENDANCE POLICIES New Remedy for those on Zero Hours Contracts Dismissal for Breach of an Exclusivity Clause in a Zero Hour Contract Now Automatically Unfair Since May 2015 workers subject to a zero hour contract cannot be dismissed for undertaking work for another employer, even if this is not permitted under the terms of the contract. The Small Business, Enterprise and Employment Act 2015 added a new s27a to the Employment Rights Act 1996 which states, at s 27A (3), that:- Any provision of a zero hours contract which: a) prohibits the worker from doing work or performing services under another contract or under any other arrangement or If a worker is dismissed, or is subject to a detriment because they have obtained work with another employer, they now have a right to redress in the Employment Tribunal following the implementation of The Exclusivity Terms in Zero Hour Contracts (Redress) Regulations 2015 which came into force b) prohibits the worker from doing so without the employer s consent, is unenforceable against the worker. on 11th January Prior to this there was no way of enforcing the ban against employers. There is no qualifying period of employment before an employee is entitled to bring a claim in these circumstances.

6 Holiday Pay Which payments should be included? The Law up to now In the case of Bear Scotland v Fulton and Others [2015] IRLR 15 the Employment Appeal Tribunal considered to what extent non-guaranteed overtime payments (overtime which the employer is not contractually bound to provide) should be included in the calculation of holiday pay. The inclusion of supplementary payments in the calculation of holiday pay was addressed to some extent in the earlier case of British Airways PLC v Williams [2011] IRLR 948, albeit this case concerned the application of Civil Aviation (Working Time) Regulations 2004 to airline pilots, as opposed to the Working Time Regulations 1998 which relates to all other workers. In British Airways PLC v Williams the additional payments received by airline pilots over and above their fixed salary were excluded for the purpose of calculating holiday pay. Clarification was obtained from the Court of Justice of the European Union (CJEU) as to what payments should be included in relation to the entitlement to 4 weeks paid annual leave conferred by the Working Time Directive 2003/88/EC. The CJEU reiterated that paid annual leave within the meaning of the EU Directive means that workers must receive their normal remuneration during a period of annual leave. This would not necessarily preclude the inclusion of other payments which the worker would usually receive in addition to their basic salary; providing that the payments received were linked intrinsically to the performance of the tasks which the employee is required to perform, and made over a period of time. However overtime was not specifically addressed in this case.

7 MANAGEMENT ATTENDANCE POLICIES In Bear Scotland v Fulton and Others it was held that payments for non-guaranteed compulsory overtime should be taken into account under the Working Time Regulations (which implemented the EU Directive) when calculating holiday pay. This was inconsistent with the provisions relating to the calculation of holiday pay under the Working Time Regulations which relies on the definition of a week s pay in the Employment Rights Act 1996 which distinguishes between guaranteed overtime and non-guaranteed overtime. Under these provisions non-guaranteed overtime does not have to be taken into account for purpose of calculating holiday pay as it is deemed not to fall within the workers normal working hours. The Courts are entitled to interpret domestic legislation in a way which would achieve the desired outcome of a European Directive (often referred to as the Marleasing principle). This enabled the Employment Appeal Tribunal to reach their decision in Bear Scotland. However in Advocate General for Scotland v Barton [2015] CSIH 92, the Scottish Court advised that there are limits to what can be done by the court to amend the expressed will of Parliament as set out in legislation. To include additional wording in domestic legislation so as to achieve conformity with a Directive would not be an appropriate application of the Marleasing principle. Recent Developments In the latest decision in Lock v British Gas UKEAT/0189/15/BA, decided on 22nd February 2016, the Employment Appeal Tribunal took a different view from the Scottish Court in the Barton case. The Employment Appeal Tribunal confirms that the UK s Working Time Regulations can be interpreted so as to include payments for overtime (guaranteed and non-guaranteed) and commission in the calculation of holiday pay. There was an earlier decision in this case of the CJEU that the EU Directive requires that result based commission paid to an employee which is not dependent on the amount of work done by that employee must be taken into account in the calculation of pay for annual leave. The dispute the Employment Tribunal had to determine was whether, in the light of the judgment of the CJEU, UK law can be interpreted in a way which conforms with the EU Directive. British Gas is appealing this decision. Underpayments of holiday pay can be brought as an unlawful deduction of wages under the Employment Rights Act 1996 and, under that Act the 3 month time limit specified for a series of deductions does not start to run until the last deduction in the series. In a radical departure from the statutory wording and the law as it had been consistently applied up to then, the Employment Appeal Tribunal in Bear Scotland said that any gap in deductions of more than 3 months breaks the series of deductions. This means that, on the law as it currently stands, employees wishing to claim for any unpaid holiday pay must bring a claim for unlawful deduction of wages within 3 months of the deduction being made or, where there are a series of deductions no more than 3 months from the last deduction in the series. If there is a gap of more than 3 months in a series of deductions it is unlikely an employee will be able to claim beyond that period as this will break the chain in the series. The EU Directive requires that result-based commission paid to an employee which is not dependent on the amount of work done by that employee must be taken into account in the calculation of pay for annual leave.

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