Top 5 recent workplace developments – October 2023
Market Insight 12 October 2023 12 October 2023
UK & Europe
Employment, Pensions & Immigration
This is our selection of key recent employment law developments for employers, HR professionals and in-house lawyers.
1. Indirect discrimination: “childcare disparity”
An employment tribunal found that dismissal of a female community nurse for refusing to work occasional weekends for childcare reasons under a new policy was justified and was not indirect sex discrimination.
Ms Dobson was employed as a community nurse. She worked fixed days each week under a long-standing flexible working arrangement. Her employer North Cumbria Integrated Care NHS Foundation Trust introduced a new policy which required community nurses to work variable days, including weekends. Ms Dobson was unable to do this because of her caring responsibilities for her three children, two of whom are disabled. She was dismissed.
Ms Dobson lost her tribunal claims for unfair dismissal and indirect discrimination. She appealed to the EAT which then overturned the tribunal’s decision in 2021. The case was then remitted back to the tribunal where she lost again.
At the first tribunal hearing, the tribunal found that whilst it was clear Ms Dobson was disadvantaged based on her own personal circumstances, there was no evidence that women as a group were disadvantaged by the Trust’s policy to require weekend working. Without this evidence, the tribunal concluded that Ms Dobson’s indirect sex discrimination failed.
On appeal, the EAT said the tribunal should have also considered whether group disadvantage could be shown in other ways. There was no requirement for Ms Dobson to produce evidence to support the argument that women were disadvantaged by a requirement to work flexible or variable working patterns, that was just one of the ways that disadvantage could be shown. The tribunal should have also considered whether group disadvantage could be established by other means including by taking judicial notice of the fact that women because of their childcare responsibilities, are less likely to be able to accommodate some working patterns than men.
The case was then remitted to the tribunal, which found that Ms Dobson had not suffered indirect discrimination or been unfairly dismissed. The tribunal concluded that her dismissal for refusing to work weekends was justified because it was a proportionate means of achieving her employer’s legitimate aim to provide care in the community 24/7. Having balanced the extent of the disadvantage to Ms Dobson against the reasonable needs of the Trust, the tribunal found that the requirement that all community nurses work flexibly was proportionate. The other nurses in Ms Dobson’s team had to work more often at weekends, leaving more senior (expensive) nurses less available for management issues during the week. Ms Dobson was unable to help at weekends as she had two disabled children but the disadvantage to Ms Dobson was at the lower end of the scale, as on the facts she had some family childcare available. Requiring her to work occasional weekends was the only measure open to the Trust (the only alternative was to exempt her altogether).
Although the employee lost her indirect discrimination and unfair dismissal claims, this case does not overrule the EAT’s comments in 2021 regarding childcare disparity, and the fact that whilst things have progressed somewhat (in that men do now bear a greater proportion of child caring responsibilities than they did decades ago), the position is still far from equal and tribunals should still consider the ‘childcare disparity’. Although the remitted tribunal’s decision illustrates that the childcare disparity does not inevitably lead to the conclusion that any form of flexible working puts, or would put, women at a particular disadvantage, such that they would always succeed in an indirect discrimination claim, we would caution employers not to place too heavy a reliance on this point as such cases always turn on the facts. It is also worth noting the tribunal’s comment that the principle of allowing flexible working should not be applied too strictly and an employer’s needs as a whole must sometimes prevail – but again, the prudent course would be to adopt a safety-first approach in these types of situation.
2. Unfair dismissal and race discrimination: Use of racially offensive term during a training session
An employment tribunal has found that a manager who used an offensive racial term in a race awareness training session was unfairly dismissed and discriminated against because of something arising from his disability.
Mr Borg-Neal, who has dyslexia, worked as a manager for Lloyds Banking Group plc. He attended a remote "Race Education for Line Managers" training session provided by an external training company.
During the session, Mr Borg-Neal asked how a manager should handle a situation in which they heard someone from an ethnic minority use a word that might be considered offensive if used by someone not within that minority. When he did not get a response from the trainer, he continued, "The most common example being the use of the 'N' word in the black community." However, when making his point Mr Borg-Neal did not say “the N word” but, rather, used the full word.
After the session, the training company reported the incident to the Bank. Mr Borg-Neal was dismissed for gross misconduct following an investigation and disciplinary process. He claimed that his dismissal was unfair and discriminatory on the grounds of his disability and race.
The employment tribunal found that Mr Borg-Neal had been unfairly dismissed. The tribunal accepted that a reasonable employer could take the view that Mr Borg-Neal's use of language was misconduct, but on the specific facts of this case the Bank did not have reasonable grounds for believing it was gross misconduct justifying dismissal. Context was key. Mr Borg-Neal had used the word only once and had immediately and repeatedly apologised, and the tribunal found that his question was relevant and well-intentioned in the context of the training session and that he had demonstrated clear remorse and that he had learnt from his actions.
The tribunal also found that Mr Borg-Neal’s dismissal amounted to discrimination arising from a disability. This was because it found that his dyslexia impacted how he expressed himself and was likely to be a strong reason why he used the full word rather than finding a way to avoid it.
The tribunal rejected Mr Borg-Neal’s claim for direct race discrimination.
This case demonstrates the importance of considering all the circumstances carefully when deciding whether to dismiss an employee for misconduct, and particularly looking at whether a lesser sanction, such as a warning, would be appropriate. Interestingly, even though the Bank had a "zero-tolerance" disciplinary policy, the tribunal's judgment suggests that an employer can demonstrate zero tolerance of discrimination without dismissal being an automatic sanction for a discrimination-related incident.
3. Holiday pay: claim for series of deductions succeeds in Northern Ireland
The Supreme Court has found that police officers could pursue claims for underpaid holiday pay on the basis the underpayments were a part of a series of deductions.
3,300 police officers and 364 civilian employees filed claims against the Police Service of Northern Ireland and the Northern Ireland Policing Board (the PSNI) for arrears of underpaid holiday pay dating back to November 1998. The PSNI admitted that holiday pay had been incorrectly based on “basic pay” instead of on “normal pay” which included overtime as required by European case law. However, the PSNI disputed the period over which the claim could be backdated, relying on Northern Ireland regulations which restricted claims to a period of 3 months before the claims were lodged.
The claims were for unlawful deduction of wages. Civilian staff were able to bring their claims under Employment Rights (Northern Ireland) Order 1996 (the Northern Ireland equivalent of identical provisions in the Employment Rights Act 1996 which apply to Great Britain). Under those rules, each time a worker takes holiday but is unpaid or underpaid, they are entitled to bring an unlawful deduction of wages claim, and where there is more than one deduction, they may bring a claim in respect of the series of deductions (each non-payment or underpayment being one unlawful deduction in a series). The first issue for the Court to decide was whether police officers were also entitled to claim in respect of a series of deductions. The Supreme Court found that they could and so their claims were not limited to the period of 3 months leading up to the lodging of their claims.
The second issue was how far back their claims could go. A key part of PSNI’s defence was to rely on the decision of the EAT in Bear Scotland v Fulton 2015 which found that the claims for unlawful deductions were “broken” by a gap of three months between such deductions. The Supreme Court disagreed with PSNI on this point, disapproving Bear Scotland. It found that PSNI had made a series of unlawful deductions, each being factually linked to its predecessor by the common fault or unifying or central vice that holiday pay had been calculated by reference to basic pay rather than normal pay. Further, the series was not broken by a lawful payment of holiday pay if the lawful payment came about, as it did from time to time, because the worker concerned was not paid overtime in the reference period and so was not in fact underpaid.
The Court endorsed the Court of Appeal's rulings on several other matters. It refuted the notion that different sources of leave (whether the minimum four weeks' leave required by EU law, the additional 1.6 weeks’ domestic leave, or any extra contractual leave) must be taken in a specific order – they must form part of a single, composite pot. Additionally, it agreed with the method for computing holiday pay using working days in the reference period and upheld the view that the appropriate reference period was a question of fact.
The case has huge financial implications for the PSNI, with media reports suggesting that it is likely to cost in excess of £30 million. For employers who are facing backdated holiday pay claims, the judgment puts to bed arguments reliant on the EAT’s Bear Scotland decision that a gap of more than three months between deductions in a series effectively brought the series to an end. Since the EAT’s judgment in 2015, this argument has been used to limit backdated holiday pay claims where workers allege that their employers have underpaid holiday over long periods of time. However, in the UK many employers will still be protected against large back-pay claims if they can rely on the Deduction from Wages (Limitation) Regulations 2014 which further restricts backdated claims by introducing a two year long stop on the period of recovery in cases based on a series of deductions for claims.
4. Data protection: New guidance and a fine for TikTok
Many employers carry out some form of monitoring of their employees to check the quality and quantity of their work, but with more people working from home and advances in technology, monitoring of employees only looks set to increase. With this in mind, the Information Commissioner's Office (ICO) has published new guidance for employers on how monitoring can be done lawfully. The guidance also includes good practice advice and checklists.
Workers’ health data is amongst the most sensitive data that employers handle. The ICO has published new guidance for employers on handling workers’ health data. This includes guidance on how employers can comply with their legal obligations, examples of good practice and checklists. The guidance also looks at specific points such as managing sick absence records and occupational health schemes, conducting drug and alcohol testing and how to approach sharing employee health data.
The Data Protection Commission, Ireland’s data protection regulator, has fined TikTok EUR345 million. The fine follows a finding that TikTok infringed the GDPR’s principle of fairness and requirements for data protection by default and design when processing personal data relating to children. Earlier this year, the UK’s ICO also fined TikTok for the misuse of children’s personal data. These fines demonstrate the willingness of authorities to use their powers to issue substantial fines for data protection breaches.
The new guidance should be helpful for employers when looking at how to comply with their data protection obligations when it comes to dealing with health data and employee monitoring.
5. Other key developments
New right to request a predictable working pattern
New legislation was passed into law in September which will give some workers and agency workers who have an unpredictable working pattern (for example in terms of the hours or times they work), the right to apply for a change to their terms and conditions of employment to get a more predictable working pattern.
We do not have all the details of how this new right will work yet. What we do know, is that it will include those on a fixed term contract of 12 months or less – which is presumed to be inherently unpredictable - and those on zero hours contracts.
Employers will have one month to respond to these requests and will only be able to reject an application on one or more grounds that will be set out in legislation, such as where there is not enough work during the periods of time when the worker proposes to work. Eligible workers will be allowed to make up to two applications in any 12-month period.
Workers will be able to bring an employment tribunal claim for unlawful detriment or automatic unfair dismissal if they suffer detriment or are dismissed for exercising this right. They will also be able to bring a claim if the employer does not follow the correct process when dealing with a request.
Further details including the length of service a worker will need to have in order to be able to make a request (expected to be 26 weeks), and a new ACAS code of practice, are expected to be published in the coming months. The government estimates that the right will come into force around a year from now.
The National Living Wage is set to increase to at least £11 per hour from April 2024
The Chancellor has committed to increasing the National Living Wage (NLW) from April 2024 as recommended by the Low Pay Commission (LPC). The LPC's recommendations are due to be announced in November but based on the LPC’s latest forecasts, it is expected that the NLW will increase to over £11 per hour. The NLW is currently applicable to workers aged 23 and over, but from April 2024 workers aged 21 to 22 are due to be moved onto the NLW.
Employers with atypical workers should start preparing for handling requests for more predictable working patterns under the new legislation when the right comes into force. They should also keep an eye out for further updates on the increase to the NLW.