Are they having a laugh?

30 10 2008

In all the time I have been writing this column I don’t recall ever having to type “the law is an ass” before.  That’s the first time and the reason is because of a case heard by the Employment Appeal Tribunal reported this week. 

It concerned  a care worker in a residential home who was required to be on call eleven hours a night seven days per week. She was allowed to rent a flat nearby at a subsidised rent so that she could get to the home quickly when required. Her duties also required her to work for eight hours per week during the day.  She brought a claim under the Working Time Regulations against her employers alleging that she had not been allowed to take sufficient rest breaks at night, even though she was asleep.  In other words, as it has been reported elsewhere, she had to be woken up in order to take her rest break, hence my initial remark.  She won her case on appeal, the Employment Tribunal having found against her in the first instance.

However daft the facts of this case might seem, there is a serious point here.  She was subject to the Working Time Regulations which require that workers be given eleven hours off in every 24 hour period and 24 hours off in every seven days.  Furthermore, she was entitled to  a 20 minute rest break every six hours.  She had not contracted out of the Regulations and her terms and conditions of work infringed them.  The main issue though concerns whether a person on call is deemed to be working – the answer from this case is yes. Although she may have been sleeping at night, she could have been called out at any time and was thus “at work”.  From an employer’s point of view it makes sense to get employees to contract out of the Regulations to avoid this type of problem.  The law may be an ass but not in this instance.

This article will appear in the “Docklands” and “Peninsula” newspaper week commencing 3rd November.

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Stress at work

24 10 2008

At these stressful times it is perhaps appropriate that the Court of Appeal should hand down an important judgment on workplace stress that may make it easier for employees to claim compensation in these cases.

The case of Dickens v O2 plc has just been reported.  It concerned an employee of O2 who was placed under great stress through overwork and who told her line managers that she was “at the end of her tether”.  They did nothing meaningful to address her problems.  Although there were other “stressor factors” in her life as well as her difficult work environment, she was able to show that O2’s failure to deal properly with her had materially contributed to her psychiatric illness. She was signed off sick with stress for several months before O2 terminated her employment.

This case has attracted some interest amongst lawyers because O2 were held not to have taken action to remedy her stress despite the fact they offered a confidential counselling service.  Since the leading case of Hatton v Sutherland, which settled the law in stress at work cases back in 2002,  many employers have taken the view that they are protecting themselves from a claim by offering a confidential counselling service.  That position has been diluted over the intervening years, but this case just reinforces that employers cannot afford to be complacent.  If an employee complains to her employer that she is becoming unwell through overwork or bullying, the employer is under a duty to take remedial action or face the consequences.

This article will appear in the Docklands and Peninsula newpapers week commencing 27th October.





What will happen to bonuses?

16 10 2008

In normal times (and heaven knows we are not in them at the moment), people only really get interested in bonuses come January and February each year.  But because of the extraordinary events of the last week or so (I’m thinking particularly of the bail-outs of some of our biggest banks) there has been speculation over what it will mean for next year’s bonus round.  The speculation has been fuelled by comments from the Chancellor of the Exchequer that large bonus payments will not be tolerated at those banks that have been part-nationalised.  The wider media, always in search of an easy scapegoat, has leapt at the chance to have a go on the issue. In turn that has led some lawyers to discuss whether bonuses can be regulated or reduced.

Most people in the financial services sector have an entitlement to be considered for a discretionary bonus each year.  In some cases (such as when an employee has just joined a new company) the bonus may be guaranteed, but in most cases not.  The usual scenario of such schemes is that the employee has no contractual right to receive anything, although there has been some case law over the years on this issue.  

Matters reached a head on this issue in 2006 in the case of Commerzbank v Keen.  That case was about the level of bonus paid to an employee and it was held, by the Court of Appeal, that the burden of proof on the employee in these types of cases was very high because the employee would have to show that the employer’s decision to pay the level of bonus actually awarded was irrational or perverse.  That is a very high hurdle to overcome of course and, in the current climate where everyone in government from the Prime Minister and  Chancellor down is calling for bonus restraint, it is unlikely that a Judge in the High Court would have much sympathy with an employee seeking a much increased bonus, especially if the Bank in question was one of the ones propped up by the tax-payer.

This may well all be academic because most employees are probably just glad to be in work at the moment and won’t be anxious to bring trouble upon their heads by arguing about their annual bonus.  If, as expected, the economy does go into recession, the levels of bonus will be lower in any event, so the prospect of regulation, by the FSA or anyone else, will recede.  Indeed, the FSA through its new Chairman, Adair Turner, has ruled this out. I also can’t see the government legislating to restrict bonuses as this would really smack of the bad old corporatist days of the 1970s.  Nationalisation might be back but is a return to the prices and incomes policies of thirty years ago realistic? I don’t think so.  

This aticle will appear in the Docklands and Peninsula newspaper week commencing 20th October.





Stuff on Maternity leave

5 10 2008

Leaving aside the global financial problems for a moment, this week (5th October to be precise) saw some important amendments to maternity leave regulations. If there is one topic that is guaranteed to bring me out in a cold sweat, it is maternity leave, with all its manifold time limits and subtle differences depending on whether the woman is on Ordinary Maternity Leave (OML) (for the first 26 weeks) or Additional Maternity Leave (AML) (the second 26 weeks).  From the 5th it all became a bit simpler when the differences between the two periods of maternity leave were removed for women whose babies were born after that date.  Prior to that date a woman on OML was entitled to all the terms and conditions of employment, like sick pay and pension contributions that she would have received had she been at work.  Her contract was only varied in respect of salary, with her entitlement being covered either by her employer’s maternity pay policy (if there was one) or Statutory Maternity Pay (SMP)*.  By way of contrast, a woman on AML before the 5th had none of those rights, save for the protection provided by the sex discrimination legislation – the right to return to her old job, to receive proper notice and the employer had a duty to uphold the implied term of trust and confidence and some other technical matters, but no right to receive pension contributions. 

That has now changed and the legal position of a woman on AML is brought into line with a woman on OML.  In particular an employer must continue pension contributions for women on AML. 

There is also no longer the need for a woman to have worked for an employer for 26 weeks before she can acquire the right to take AML; a woman who knows she is pregnant when she starts a new job can claim AML after her OML has finished. 

* By the way SMP pays 90% of average earnings for the first six weeks and then £117.18 for the next 33 weeks

For more information on the these matters have a look at the government’s website – www.direct.gov.uk/en/parents  – it’s got a lot of useful stuff on it, including personalised calculators.

This article will appear in the “Docklands” and “Peninsula” newspapers week commencing 13th October 2008.





It’s up to you which lawyer you instruct

3 10 2008

I’ve been asked a couple of time recently by prospective clients whether I can act for them when they’ve been given a compromise agreement by their employers, usually following redundancy.  The answer is almost always yes. Why does the question get asked? Well, often HR departments will, as a service to their departing employees, provide a list of solicitors that will be able to advise on the agreements, because it is a requirement of every properly drafted compromise agreement that an independent solicitor review and explain it and sign a certificate at the end of the document to say they have done so.  Indeed, my firm is on many such lists.  The employer will usually offer to pay a contribution towards the cost of that advice and in many cases that contribution will cover all the solicitor’s fees in advising on the document.  Many people think that they are only allowed to use the law firms on the list provided by HR, but this is not the case. 

 

If you decide not to use one of the suggested law firms that HR provides, it is a good idea to use a solicitor that is experienced in employment law and with compromise agreements. They can be complex documents and advice has to be given on not only the terms of the document but on whether the Employee has any potential claims against the employer that would otherwise be settled by signing the document.  My colleagues and I here at Langley Towers deal with compromise agreements every day and we would no more think of advising a client on a big money divorce case than, hopefully, would someone who only advised on divorce or criminal law.

 

In these turbulent times if you happen to be given a compromise agreement and don’t feel comfortable with the list of law firms given you by HR, for whatever reason, do find a firm that you do want to instruct.  Do remember that HR has one concern in these scenarios and that is to get your signature and that of your solicitor, on the document as quickly as possible so that they can relax knowing you aren’t going to sue them.  In 99% of cases there will be no objections if you use your own solicitor.

 

We often act for employees in this situation and we have huge experience of dealing with compromise agreements issued by a vast range of companies, from huge investment banks to small IT companies.  If I can help, give me a call.

 

This article first appeared in the “Docklands” and “Peninsula” newspapers week commencing 6th October 2008