Latest News

18 09 2009

Employers have to repay sick pay

Some good news for employees came out last week with the decision by the European Court of Justice in Pereda v Madrid Movilidad SA that says if an employee is sick whilst on holiday, they can retake the holiday later on or carry the days lost over to the next year. 

Not surprisingly employers’ representatives are unhappy about it as it places additional burdens on them.  It also increases the risk of unscrupulous employees taking advantage. No guidance is offered by the ECJ on how this could be policed.  Employers can only insist on a sick note from GPs after seven days absence. 

Costs Awards in Tribunal

A while ago I wrote about the case of Daleside Nursing Home v Mathew    which dealt with the issue of when costs should be awarded against a party by an Employment Tribunal.  A recent case has now followed that decision.  In Dunedin Canmore Housing Association Limited v Donaldson, a case before the Employment Appeal Tribunal (EAT) in Edinburgh it was held that the Claimant (who was representing herself) had lied under oath and the Tribunal should have awarded costs against her.  In particular the Honourable Lady Smith said;

The issue was not whether a lay person could reasonably have been expected to understand the law.  It was whether she had or had not, in simple human terms, approached the essential factual matters that lay at the heart of her case honestly and reasonably.  She had not done so and these are exactly the sort of circumstances where a Tribunal has a responsibility to make clear that it is quite unacceptable to cause expense to another party by bringing proceedings on that basis.

Be warned!

 

Notice Monies and Constructive Dismissal

Here is some good news for employers.  The Court of Appeal (CA) has recently overturned the EAT’s decision in Stuart Peters v Bell  which had said that an employee who claimed constructive dismissal from his employer and then went on to work for another  employer during the notice period they would otherwise have served did not  have to give credit for the monies earned.  This has been the law, since 1972 case of Norton Tools v Tewson.  Effectively the employee could get his salary twice for that period, which was something of a windfall for him.  That has now been overturned by the CA, but only insofar as constructive dismissal cases are concerned. So, if an employee claims constructive dismissal, leaves the employer without serving their notice and finds alternative work elsewhere, the employer won’t have to pay the notice monies due to the employee during that period.

 Norton Tools is still good law in other respects and hasn’t been completely overturned.

Please contact me on 0207 464 8433 or email me at michaelscutt@dalelangley.co.uk if  you require further advice.





How (not) to sack someone

14 09 2009

As an employer, if you want to avoid your name appearing in the Metro or any of the other free papers, try to avoid sacking employees suffering from cancer by email.  This is the moral from the recent report concerning Melinda Bolnar, a 27 year old teacher suffering from bowel cancer and who had just endured seven months of chemotherapy and given a 30% chance of survival.  According to the report it is alleged that her private school sacked her by email.  I should point out that the case is due to be heard at an Employment Tribunal later this year and the above report are merely the employee’s allegations against her employer and not the proven facts.

The report probably doesn’t give the whole story but it certainly gives the impression that Melinda was sacked without any form of disciplinary or capability procedure.  If that genuinely is the case the school might find themselves in difficulty when the case does reach the ET.

So (assuming that is what happened) what should an employer do if it wants to terminate the employment of an employee suffering from long-term illness?

The first and most important question is why should the employer want to terminate the employee’s employment?  This will be at the heart of any subsequent litigation that may arise.  The usual answer given by employers is that they could not afford to keep the position empty whilst the employee was away or that temporary cover could not be extended indefinitely.  Much will depend upon the role performed by the employee and the extent to which it is reasonable for the employer to reach the conclusion that dismissing the employee was reasonable in all the circumstances.  The size and resources of the business will be important too. What action might be reasonable for a small employer to take will be greatly different from a multi-national PLC or, for example, the NHS. How the employer treated other staff in similar circumstances on other occasions will be relevant: what are the contractual sick pay provisions, if any?

There are only a limited number of grounds on which dismissing an employee will be fair.  They include capability to do the job.  This can mean lack of ability of the employee to fulfil their role (i.e. incompetence) or it could include inability to do the job through sickness.  Problems can arise for an employer when the employee takes lots of short periods of time off sick (whether genuinely or otherwise) but when, as in the type of case under discussion here the employee is off for weeks or months.   

A prudent employer will properly investigate the reasons for the employee being absent and will try and establish when they might return.  This will need to be done with sensitivity and tact, which means good communications between employer-employee are going to be vital to make this work.  It will probably need medical evidence to be obtained and a well-drafted contract of employment should include a clause which allows the employer to send the employee to a doctor of its own choosing.  If the medical evidence suggests that the employee will be fit to return to work, even if on a gradually stepped basis at first, in a fairly short space of time, the business will need to think long and hard before dismissing.  On the other hand, if the absence looks like being lengthy then the employer may be justified in bringing the employment relationship to an end, provided it does so on grounds of (in)capability.

Where difficulties arise (as in Melinda Bolnar’s case) is where the employee feels there are other grounds for dismissal.  The Metro report states that she is suing for disability discrimination.  Much will depend, as usual, on who said or did what and when.  To avoid difficulties of this sort an employer needs to act clearly and openly about what it is doing and why. 

It needs to follow a proper process, as laid down by the ACAS Code of Practice introduced this April. In brief this means the employer investigating properly, inviting the employee to a meeting to discuss the issues, allowing them to be accompanied by a work colleague or Trade Union representative and to make their point.  Finally, the employee should be informed of their right to appeal the decision if it goes against them.  If the employer gets it wrong they can not only face a claim for unfair dismissal (with the potential for the award to be increased by up to 25% if they are deemed to have acted unreasonably) but also a claim for disability discrimination.  Claims under the DDA are not capped at the £66,200 maximum compensatory award, as with unfair dismissal cases.

Of course, all the above leaves aside the moral issue of whether it is the right step to take but and Courts/Tribunals don’t make judgments on moral grounds: the newspapers do that.

If you are an employer or employee requiring further advice on any of these issues, please get in touch with me at michaelscutt@dalelangley.co.uk or on 0207 464 8433





Costs in Employment Tribunals

27 05 2009

At first glance this might not seem the most exciting topic, but bear with me as the recently reported Employment Appeal Tribunal (EAT) case of Daleside Nursing Home v Mrs Mathews has thrown up a very interesting point about when costs might be awarded against the losing party before an Employment Tribunal (ET).

The usual rule is that ETs don’t award costs against the losing party, unlike in the High or County Court where that is the starting point (although even in those venues this rule is subject to several caveats but that is another story).  ETs have the power to award costs, it is just that they don’t do it very often.   The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2004 provide that power. In particular Regulations 38 – 48 set out the costs regime. 

Reg. 40(2) provides that an ET may order costs against the paying party if it considers that that party has acted unreasonably either in the bringing or the conduct of the proceedings.  Reg. 41 limits the costs that an ET can award to a maximum of £10,000, although if the case is sent to the County Court for detailed assessment more can be awarded.  The ET also can have regard to the paying party’s ability to pay an award for costs, so if a party has behaved badly in bringing the case in the first place or in the way they progressed the case but they don’t look like they’re worth the money, an ET doesn’t have to award costs against them.  Contrast this with the Courts where no such power exists unless the paying party is legally aided, in which case the court will make an order for costs but stipulate that it is not to be enforced without leave. 

The Daleside case is interesting because it was an appeal by the employer from the refusal of the Liverpool ET to award costs against the employee where she had claimed direct race discrimination.  In particular she had alleged that her line manager had called her a “black bitch”, although the ET found that that comment had not been made. The reasons they cited were that Mrs Mathews waited for almost three weeks after the comment was made before complaining about it and just before she was about to face disciplinary proceedings.  The ET took the view that the alleged comment was a “cynical lie” on the part of the employee.  Mrs Mathews subsequently lost.  The employer sought an order for costs but the ET refused to make one so the case proceeded to the EAT on that one point.

Not surprisingly, the EAT held that an order for costs should have been made given that the disputed comment was at the heart of the case for racial discrimination.  The Judgment  at para. 20 states

In our judgment, in a case such as this, where there is such a clear cut finding that the central allegation of racial abuse was a lie, it is perverse for the Tribunal to fail to conclude that the making of such a false allegation at the heart of the claim does not constitute a person acting unreasonably.”

The EAT then sent the case back to the ET for consideration of how much should actually be awarded against Mrs Mathews.  Interestingly, at para 3 the judgment states that the EAT was not seeking to lay down “any more general statement of legal principle”.  That remains to be seen as I suspect this case is now going to be quoted by both employers and employees ad nauseam  in any case where there is a dispute on the facts (ie most cases!).