Employment Briefing – March 2014
Print newsletter28/03/2014

6 April 2014 – “Need to Know”
A raft of new legislation comes into force on 6 April, which is now only […]
A raft of new legislation comes into force on 6 April, which is now only a matter of weeks away. We look at what employers ‘need to know’ in advance of this date.
ACAS early conciliation
The new ACAS early conciliation (‘EC’) scheme launches on 6 April and will operate on a non-compulsory basis from that date until 5 May when it will become compulsory. In a nutshell, employees must have contacted ACAS under the rules of the EC scheme before they will be permitted to file a claim with the Employment Tribunal. An ACAS conciliator will contact the prospective respondent to see whether there is any scope for conciliation but, importantly, there is no obligation on either the prospective claimant or respondent to actively engage in conciliation discussions if they do not want to. If, however, the parties do wish to attempt to conciliate then the EC period can last for up to a month (with a possible 2 week extension if both parties agree). At the end of the EC process, ACAS will issue the claimant with an ‘EC certificate’ containing a reference number that the claimant must include on any future Tribunal claim (without it the claim will be rejected). The time limit that the claimant has to bring the claim to Tribunal is effectively ‘put on hold’ whilst EC is ongoing.
What does this mean for employers?
EC introduces an additional step that a claimant must go through before bringing a claim. In conjunction with Tribunal fees it may have the effect of dissuading some employees from bringing claims. Arguably it provides employers with an opportunity to put forward their strongest arguments to dissuade employees with unmeritorious or ‘nuisance’ claims and also to nip any problematic or sensitive claims in the bud at an early stage.
On a practical note, it is possible that ACAS might contact an employee’s manager directly if the employee has named them on the EC form. As such, employers may wish to take this opportunity to remind managers and team leaders that any contact from ACAS should be referred to HR and they should not attempt to engage in any conciliation discussions without appropriate authorisation/support.
Financial Penalties
From 6 April, Employment Tribunals will have the power to award a financial penalty against an unsuccessful employer where there have been ‘aggravating features’. The penalty can be between £100 and £5,000 and must be 50% of any award made to the employer up to the maximum of £5,000. The penalty is paid to the Government, not to the employee.
What does this mean for employers?
It is not yet clear how the tribunal will identify an ‘aggravating feature’ but it is likely to involve some element of serious procedural breach, malice or bad faith rather than a genuine error or minor procedural slip up. Breaches of the ACAS Code of Practice on disciplinary and grievance procedures already carry the risk of an uplift in compensation. This makes it doubly important to ensure that HR processes (including anti-harassment and bullying, equal opportunities, disciplinary, grievance and dismissal procedures) are adhered to. Employers may wish to update their HR training to include the new financial penalties.
Discrimination Questionnaires abolished and replaced with new ACAS guidance
Employers will be mostly relieved that discrimination questionnaires are to be abolished from 6 April as they were notoriously unwieldy and onerous to deal with. ACAS has published new guidance for employers on dealing with questions of discrimination received from employees which takes effect from 6 April 2014.
What does this mean for employers?
Whilst it is true that the existing ‘questionnaire’ procedure has been relaxed (i.e. no statutory time limits for answering questions and no ‘adverse inferences’ can be drawn from a failure to reply or an evasive reply) the Tribunal can still take account of an employer’s failure to comply with the new ACAS guidance so caution should still be exercised.
Limits on tribunal awards to increase
The maximum compensatory award for unfair dismissal will rise from £74,200 to £76,574 (subject to a ‘cap’ of a year’s gross pay) from 6 April. The maximum amount of a week’s pay (used to calculate redundancy payments and the basic award of compensation for unfair dismissal) also rises from £450 to £464.
Remember that the maximum compensatory award an employee can recover in an ordinary unfair dismissal claim is the lower of a year’s gross pay or (from 6 April) £76,574. In reality, awards at these levels are rare so the limits can give employees unrealistic expectations about how much they will recover if they succeed in their claim. By way of example, the median unfair dismissal compensatory award for 2013 was £4,832.
Extension to flexible working rights by 30 June 2014
The extension of flexible working rights to all employees with at least 26 weeks’ service (i.e. not just those with caring responsibilities) had been delayed from its original implementation date of 6 April 2014 but the Government has now confirmed that this extension will be brought in by 30 June 2014. There will also be a new ACAS Code of Practice on ‘dealing with flexible working requests in a reasonable manner’ which is a more relaxed and straightforward version of the existing statutory request procedure.
What does this mean for employers?
We strongly recommend that employers update their flexible working policies in line with the new statutory regime. The consequence of not doing so will be that employers may well be required by their own internal procedures to go further than the law requires them to when dealing with flexible working requests. Please contact us if you would like further advice or assistance with this process.

Case Law round-up – March 2014
Whistleblowing – chain of email correspondence capable of being a protected disclosure Norbrook Laboratories (GB) […]
Whistleblowing – chain of email correspondence capable of being a protected disclosure Norbrook Laboratories (GB) Ltd v Shaw [UKEAT/0150/13]
It is unlawful to subject a worker to a detriment or dismiss them for making a protected disclosure (whistleblowing). Disclosure of information showing that the health or safety of an individual is at risk can qualify as a protected disclosure. In this case, the EAT had to decide whether a chain of email correspondence could amount to a protected disclosure when read together (when, taken on their own, each email did not amount to a protected disclosure).
C was a sales manager responsible for a number of sales people who were required to drive out to customers. During the inclement winter of 2010, C raised concerns about the safety of his sales team when they were driving in the snowy conditions. His first email was to the health and safety manager asking for advice and whether a risk assessment had been carried out regarding driving in the snow. The second email was to the same health and safety manager asking for formal guidance and stating his concerns about the dangers of driving in the snow. The third email was to HR (attaching the previous two emails) setting out his concerns and pointing out his duty with regards to the health and safety of his team.
The EAT found that the emails taken together could amount to a protected disclosure even though, taken separately, they would not have been.
Walker Morris comment
It is not uncommon for employees to raise concerns about health and safety at work and this case highlights the importance of taking such concerns seriously. The three emails taken separately would not have amounted to protected disclosures but taken together (as they were all ultimately sent to the same HR manager) they were. Managers should be trained to look out for situations such as this and seek advice from HR if they feel alarm bells ringing in relation to any concerns raised. This is especially so given that an employee does not need any qualifying service to bring a claim of unfair dismissal for whistleblowing and the statutory compensation cap also does not apply to such claims.
Dismissal of school caretaker for historical unproven abuse allegations was unfair Z v A [UKEAT/0203/13; UKEAT/0380/13]
The EAT found that a school’s decision to dismiss its caretaker for ‘some other substantial reason’ based on allegations of historical unproven sex abuse was unfair.
A was a school caretaker. The school was informed by the police that an historical allegation of child sex abuse had been made against A. It immediately suspended A whilst police investigations were ongoing. After a year on suspension (during which no charges were brought by the police), A was eventually dismissed on the basis that the allegation eroded trust and confidence and posed a serious risk to the school’s reputation. Prior to the dismissal hearing, the head teacher was made aware by the police that none of the witness statements taken supported the allegation and it appeared that no criminal charges were going to be brought against A. A claimed unfair dismissal and the Employment Tribunal (ET) upheld his claim. The school sought to justify the dismissal on the grounds of some other substantial reason (SOSR) in that even if A were to be “completely exonerated the trust and confidence in him had been eroded and there would always be an element of doubt”.
The ET found that a bare accusation of abuse could not, by itself, amount to some other substantial reason justifying dismissal. It held that the school had been required to strike a balance between the welfare of the school’s children and the interests of A and that it had got that balance wrong.
The EAT agreed with the ET. It said that an employer would not be acting reasonably if it took an uncritical view of information disclosed to it about abuse allegations. It held that employers should carry out their own enquiries or at least consider whether it is possible to do so. It commented that there was no automatic presumption that a dismissal for abuse allegations will inevitably be fair. In addition to the fact that the allegation did not provide a valid SOSR reason, the school had also not followed a fair procedure in relation to the dismissal because A had not been given an opportunity to answer the allegations against him.
Walker Morris comment
The following practical points can be taken from this case:
- Unsubstantiated allegations of sexual abuse, which are given no additional weight by the police, necessitate an extremely careful balancing act by the employer
- This case demonstrates that there is no hard and fast rule that dismissals for allegations of sexual abuse will automatically be fair or that they will qualify as an ‘SOSR’ reason
- These type of cases will always be very dependent on their facts and the ET will want to establish that any decision to dismiss was not simply a ‘knee-jerk’ reaction
- If you are dealing with a case like this it is important not to rely on unsubstantiated allegations even where these have come from the police. Employers must consider whether they can reasonably make any enquiries to test the allegations themselves
- The school’s haste to dismiss A and its concern for its reputation arguably meant that it rushed things and failed to follow a fair dismissal procedure. Procedural slip ups such as this can be avoided by taking a methodical approach and this is all the more important in difficult and sensitive cases such as these.
Misconduct dismissal – ‘reasonable band of responses’ test
GM Packaging v Haslem [UKEAT/2014/0259]
To decide whether a dismissal for misconduct is fair, the employment tribunal must look at whether the employer’s decision to dismiss falls within the “reasonable band of responses of a reasonable employer”. If it does, then the tribunal is not allowed to substitute its own view for that of the employer even if it feels that dismissal was harsh and that a final written warning would have been enough.
In the recent EAT case of GM Packaging v Haslem, the employer discovered that a senior manager had engaged in sexual activity with a member of staff on company premises after hours. After an investigation the manager was dismissed for gross misconduct.
The employment tribunal found that the manager’s behaviour, whilst not acceptable, was not gross misconduct and that dismissal was outside the band of reasonable responses. The EAT disagreed and said that the manager’s behaviour on company premises (even when it was after hours) did amount to gross misconduct and that dismissal was within the band of reasonable responses of a reasonable employer. The EAT criticised the ET for making the mistake of substituting its own view as to the penalty it would have imposed for the employer’s view.
Walker Morris comment
During appeals, employees often assert that a dismissal was unfair because it was ‘too harsh’. This case is a helpful reminder that, as long as dismissal is within the range of reasonable responses, it is unlikely to be overturned by a tribunal even it takes the view that a different employer might have given a lesser sanction such as a final written warning. That said, it is important not to forget that a flaw in the process can make a dismissal procedurally unfair (even if the reason for dismissal is fair). In cases where an employer has a really solid reason for dismissal it can be tempting to rush through the dismissal procedure but this can be a false economy if it leads to a claim based on procedural unfairness.
Equality Act 2010 prohibits post-employment victimisation
Rowstock v Jessemey
In our June 2013 employment newsletter we reported on two directly conflicting EAT decisions on whether the Equality Act 2010 provides protection against post-employment victimisation. In the case of Rowstock v Jessemey, the EAT held that the Equality Act does not provide protection for post-employment victimisation and in the case of Onu v Akwiwu it held that it does! Mr Jessemey appealed to the Court of Appeal and the Equality and Human Rights Commission supported him with legal representation because it believed that the EAT’s decision was contrary to European law.
Mr Jessemey had received an unfavourable reference from his ex-employer because he had previously brought a claim of age discrimination against it. The Court of Appeal held that the Equality Act does prohibit post-employment victimisation, thus clearly up the uncertainty on this point.
Walker Morris comment
Post-employment victimisation can take forms other than giving a bad reference, for example, refusing to consider an ex-employee for re-employment if a suitable vacancy arose or colleagues ‘bad-mouthing’ an ex-employee because of a previous discrimination complaint. This case therefore highlights the importance of employers following the principles of their Equal Opportunities policies and statements in relation to ex-employees as well as existing employees. Many employers have a policy of giving factual references only but it is not uncommon for informal approaches to be made directly to previous managers so it may be worth providing some training on how to deal with any such approaches appropriately.
Caste discrimination
Tirkey v Chandok and another ET/3400174/13
The Government intends to amend the Equality Act to specifically outlaw discrimination on the grounds of an individual’s caste during the course of 2015. At present, it is unclear whether or not the Equality Act expressly prohibits this type of discrimination but a recent Employment Tribunal decision has found that it does. The case involved a domestic worker employed by a husband and wife to work in their home. She argued that she was treated badly by the couple because she was of a ‘lower’ caste than them.
Walker Morris comment
Cases of caste discrimination could be an issue in workplaces where there are a number of employees from an ethnic background associated with a caste system. This Employment Tribunal decision (though not binding) suggests that such claims will be examined carefully by Tribunals pending the Equality Act being amended in 2015.

Employment Breakfast Seminar
Where Walker Morris, Kings Court, 12 King Street, Leeds, LS1 2HL When Monday 7 April […]
Where
Walker Morris, Kings Court, 12 King Street, Leeds, LS1 2HL
When
Monday 7 April 2014
08:30 Registration with breakfast
09:00 Session
10:45 Ends
Why
This seminar, the first of a new programme of employment breakfast seminars, will cover key developments over the last 6 months with a focus on:
• “Need to know” recent changes including ACAS early conciliation, financial penalties for employers and practical implications of case law developments
• Focus on TUPE Reforms – what has changed and what do you need to know?
• “On the horizon” – what is coming up and what do you need to do to prepare?
The seminar will run in a format which addresses the above topics in sufficient depth but also allows time for discussion, the airing of practical experiences and networking.
Speakers
Members of the Walker Morris Employment Team
Our employment team is recognised for its large private sector client base with considerable experience in providing complex employment advice to private and listed companies. The Team also advises and represents significant numbers of public sector, local authority and education organisations in relation to all forms of projects and disputes. This experience includes assessing risks with clients, advising on processes relating to redundancy, TUPE, sales, shared services and insolvency as well as advising on day to day issues arising from implementing policies.
The team offers experience of contentious employment issues, representing both parties in employment disputes from individual claimants to corporate respondents and regularly undertakes advocacy.
“They offer an excellent employment service – we get a national service from a regional provider” – Chambers
Session eligible for 1.5 CPD points
To book your place on this seminar please click here

Employment News – March 2014
National Minimum Wage The Low Pay Commission (LPC) has recommended that the adult NMW rate […]
National Minimum Wage
The Low Pay Commission (LPC) has recommended that the adult NMW rate (currently £6.31) be increased by 3% to £6.50 an hour with effect from 1 October 2014. Approximately 1.35m workers in the UK are paid the NMW and an increased figure of £6.50 would obviously bring a lot more workers into this category. There is also likely to be a ripple effect as workers currently paid just above any increased NMW rate will expect their pay to be increased in turn.
An above-inflation rise in the NMW is clearly supported by the Government and the LPC has commented, “Provided the economy continues to improve we expect to recommend further progressive real increases in the value of the minimum wage, restoring and then surpassing its previous highest level, so that 2014 will mark the start of a new phase – of bigger increases than in recent years – in the work of the Commission.”
In a related development, the maximum financial penalty for employers who flout the NMW has increased from £5,000 to £20,000 and the Government also wants to amend the law to make this penalty apply to each underpaid worker.
Employers currently paying the NMW may want to begin thinking now about how they will manage the proposed increase both in terms of NMW workers and workers paid just above it. The changes also make it all the more important to make sure that employees on or close to the NMW (especially those who work ‘on call’, travel between jobs as part of their working day or do varying amounts of overtime) have their working hours correctly calculated to avoid the risk of inadvertently breaching the law.
“Woolworths” Case
We reported in our January employment newsletter that the landmark decision of the EAT in the “Woolworths” case (USDAW & Anr v Ethel Austin Limited (In Administration) & Ors) s was due to be heard by the Court of Appeal at the end of January. The Court of Appeal has now referred the case up to the European Court of Justice (ECJ) for its determination on the question of what is an ‘establishment’. It is therefore likely to be some time before we have any further guidance on this case and, for now, the EAT’s decision stands.
Please refer to our Business Insight for further details of the case. We will report on the ECJ’s findings as soon as they are known.
Judicial Review of Tribunal fees unsuccessful
The Judicial Review challenge to Employment Tribunal fees brought by Unison has been unsuccessful. Unison argued that the fees breached equality laws but the Court found that it did not have enough evidence to consider this point properly. Unison have said they will appeal but, for the foreseeable future, fees are here to stay. One point worth noting is that the High Court made it clear that it would expect Employment Tribunals to order an unsuccessful respondent to pay the successful claimant’s issue and hearing fees.
Government announces launch of Health and Work Service
The Government has announced that a free of charge ‘Health and Work Service’ will be launched later this year. It will be available on a voluntary basis for any employee who is off work sick for more than 4 weeks. GPs will be able to refer employees to the service where they will be assessed by an occupational health advisor. The advisor will prepare recommendations for how the employee might be able to return to work.
Many employers have well established procedures for dealing with long term sickness and the new service is unlikely to affect how these currently operate. It will, however, be interesting to see how effective the service is in reducing long term sickness rates. The Government estimates the scheme could save companies up to £70 million a year in reduced sickness pay and related costs