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The Range of Reasonable Responses Newsletter: October 2019

With a general election now scheduled for December 12 I am bracing myself for an ill-informed debate about the future of workers' rights post-Brexit. In a post on my blog I looked at how vague the Conservative assurances on this issue tend to be - and also the odd phenomenon of the Lexiter (left wing Brexiter) who claims that the EU has done little to improve workers' rights in the UK.

But we should remember that our membership of the EU is not the be all and end all when it comes to employment law. Whatever happens with Brexit, a Government with a working majority will be able to make major changes to employment law - if it wants to. When the parties' manifestos are published we will see how much of a battleground employment law is likely to be. I suspect that we will get radical proposals from Labour, but a rather bland commitment to 'maintain high standards' from the Conservatives. 

By and large a Conservative Government probably means that employment law stays pretty much as it is today. A Labour Government on the other hand will mean a transformation of employment rights and a major shift towards trade unions and collective bargaining. When I talk about employment law I try hard to stay politically neutral, but I can't avoid the fact that a Labour Government would make for a much more exciting employment law landscape. Obviously more is at stake here than how much new employment law I have to talk about  - but fingers crossed!

Holiday pay - no end to the saga 

It seems that the case of The Harpur Trust v Brazel has been given permisison to appeal to the Spreme Court. This is the case of a casual, term time only, music teacher whose holiday pay was calculated as 12.07% of her total pay rather than on the basis of the 12 week average set out in the Working Time Regulations. I tried my best to get my head around the maths in this article for West Midlands Employers back in March 2018. Since I wrote that the case has been to the Court of Appeal which upheld the EAT's decision. Interestingly the Court of Appeal accepted that under the Working Time Directive a different approach might be possible allowing holiday entitlement to be pro-rated to reflect the fact that the employee did not work for the whole year. However the terms of the Working Time Regulations were clear and did not allow for any deviation from the 12 week average. The Directive provided for a minimum level of holiday pay and there was nothing wrong with our Regulations providing for a more generous entitlement. 

I think the Court of Appeal is right and I don't see on what basis the Supreme Court could overturn it. This is a long process however and it will probably be a year or more before we have a definitive answer. Brexit will be done and dusted (one way or the other) long before we have resolved all of the outstanding issues on the calculation of holiday entitlement. 

Legal privilege

I normally steer away from purely procedural cases as they tend to be dull, but the case of Curless v Shell International Ltd caught my eye.

The employee was a lawyer who was struggling with various disabilities that affected his sleep and concentration. He was being taken through an internal performance management process and had already brought a disability discrimination claim. He was then made redundant as part of a wider reorganisation and brought a second claim  arguing that the redundancy was a sham and the real reason for his dismissal was that the employers wanted to get rid of him under cover of the reorganisation. 

There were two pieces of evidence that he wanted to use in the case. The first was a conversation he overheard in a pub (the Old Bank of England on Fleet Street, just next to the Royal Courts of Justice - a good place, I recommend their pies). A group of lawyers on the table next to him were discussing a case in which a senior lawyer had brought a disability discrimination claim but 'his days were numbered' because the employer planned to use a forthcoming redundancy exercise to get rid of him. He was convinced that they were talking about him - and he was probably right. 

The second piece of evidence was an email that was leaked to him in which a lawyer seconded to Shell described the advice that she had given to his employers. She had suggested that the employer could use the reorganisation to deal with the employee's case and 'avoid an impasse... with no obvious resolution'.

Normally you cannot use legal advice given by a qualified lawyer as evidence in a case because it is 'privileged'. For a really good explanation of what legal privilege is and how it works, you should listen to Daniel Barnett's podcast on the topic. But there is an important exception known as the iniquity principle. Advice will not be privileged if it is 'iniquitous' - if it involves acting dishonestly or improperly. The EAT held that the email and the conversation fell into this category because it indicated that the employer was using the cloak of a genuine redundancy exercise to rid themselves of a troublesome employee. 

The Court of Appeal disagreed. Reading the email carefully it did not suggest a sham arrangement and made it clear that the redundancy process could only be used with 'appropriate safeguards and in the right circumstances' . The lawyer in question was considering two alternative risks. If the process led to the employee being selected for redundancy then he might claim that his dismissal was unfair and discriminatory, but if he remained in employment there was a risk of an impasse. There was nothing here suggesting that the redundancy process should be used in an improper way - it was simply the sort of advice that lawyers gave 'day in-day out'. As for the pub conversation, that was being relied upon to help interpret the email. But the meaning of the email could not be changed by overheard gossip taking place some weeks later. 

The fact that this evidence will now be excluded does not mean that the case is doomed to fail. If the selection for redundancy was a sham - or was motivated by the existing disability discrimination claim - then that will still lead to a finding of unfair dismissal, discrimination and victimisation. The outcome may depend on how well the employer took the advice to endure that there were 'appropriate safeguards' to prevent those matters from influencing the selection.

Redundancy and alternative work

While we are on the subject of redundancy a case has just come in on entitlement to a redundancy payment when the employer offers what it considers to be suitable alternative work. In East London NHS Foundation Trust v O'Connor the employee was told that he was at risk of redundancy and his role was being deleted. He took up what was described as a trial period in a new role that he did not regard as satisfactory. The trial period was extended but eventually he made it clear that he wasn't prepared to accept the new role and he was dismissed for redundancy. He was denied a redundancy payment, however, because, the employer said, his trial period had come to an end before he formally told then that he would not accept the new post.

The case is a bit of a mess and the EAT decision is long and complex. I'll be trying to make sense of it when I deliver employment law updates over the coming months, but the central point is this: the alternative work provisions in the part of the Employment Rights Act dealing with redundancy do not match up with modern practice. When talking about a trial period the statute requires that the employee has actually been dismissed and then offered the alternative work, with the new role beginning only after the original dismissal has taken effect. Nowadays, however, the search for alternative work almost always takes place when the employee has been placed 'at risk' of redundancy.. An offer of a new job usually comes before notice has been given. 

It surprises many people to discover that the phrase 'at risk of redundancy' has no formal legal status. In the O'Connor case the employee was placed at risk of redundancy and he was told that his original post had been deleted - but he wasn't actually told that he was being dismissed and he certainly wasn't given notice. It followed that the statutory trial period had never even started - much less expired. The Tribunal will now have to decide why he was dismissed and whether he will qualify for a statutory redundancy payment. I suspect that a rather more hefty contractual redundancy payment also depends on the answer to that question.

Parish notices

It was great to see so many people at the West Midlands Employer's event on 18 October - and at the West London CIPD the week before. Hello to all those who have signed up to this Newsletter after coming to one of those sessions!

My next public outing is for North West Employers on 11 December. I was a bit worried that this could clash with the election, but the timing has worked out alright in the end. Don't expect any predictions from me about the future of employment law, but there will be lots to talk about all the same. You can sign up for a place here

Thanks for subscribing to this Newsletter. Happy Halloween!

Copyright © 2019 Darren Newman Employment Law Ltd, All rights reserved.

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