Employment Review - September 2008
Welcome to this month’s Employment Review, presented by Hanif Lula. He is an employment and immigration solicitor in our Manchester office and advises and provides representation on the full range of immigration issues in addition to dealing with employment issues and disputes.
The Manchester office recently moved in to larger offices within the same building and are expanding in all areas including employment and general litigation. We now have two new departments, a corporate and a minerals law department.
This edition of the Review considers the issues of ‘associated disability discrimination’, equal pay claims and immigration law problems faced by employers. We also provide a case law update on statutory dismissal, sex discrimination and harassment based on age.
Discrimination against carers
New Tier 2 Immigration system
Case law update - age related harassment: comments in the workplace
North West Development Agency & MIDAS
Employing illegal workers
North east councils’ pay protection schemes judged to be unlawful
Selvarajan Overruled - Statutory Dismissal Procedure
Announcement - North West
Collaborative Procurement Hub
Ms Coleman, a legal secretary from January 2001, gave birth to a son in 2002, who suffers from apnoeic attacks and congenital laryngomalacia and bronchomalacia. Her son’s condition required specialised and particular care and Ms Coleman was his primary carer.
In 2005, Ms Coleman accepted voluntary redundancy, however, she subsequently lodged a claim with the Employment Tribunal, alleging that she had been subject to unfair constructive dismissal and had been treated less favourably than other employees because she was the primary carer of a disabled child.
She claimed the treatment caused her to stop working for her former employer. The case came before the Employment Tribunal at a preliminary hearing to consider whether the Disability Discrimination Act applied to persons who themselves were not disabled but caring for disabled persons (associated discrimination). The Employment Tribunal referred the case to the ECJ for a ruling on that issue.
The facts are assumed to be as follows (as they were not determined by the Employment Tribunal):
• On Ms Coleman’s return from maternity leave, her former employer refused to allow her to return to her existing job, in circumstances where the parents of non-disabled children would have been allowed to take up their former posts.
* Her former employer also refused to allow her the same flexibility with her working hours and the same working conditions as those of her colleagues who are parents of non-disabled children.
• Ms Coleman was described as ‘lazy’ when she requested time off to care for her child, whereas parents of nondisabled children were allowed time off.
• The formal grievance that she lodged against her ill treatment was not dealt with properly and she felt constrained to withdraw it.
• Abusive and insulting comments were made about both her and her child. No such comments were made when other employees had to ask for time off or a degree of flexibility in order to look after non-disabled children.
• Having occasionally arrived late at the office because of problems related to her son’s condition, she was told that she would be dismissed if she came to work late again. No such threat was made in the case of other employees with non-disabled children who were late for similar reasons.
ECJ Judgement
The ECJ determined that it did not follow from the provisions of the Directive, as a result of which the Disability Discrimination Act (DDA) was enacted, that the principle of equal treatment which it is designed to safeguard, is limited to people who themselves have a disability within the meaning of the directive. The purpose of the directive, as regards employment and occupation, is to combat all forms of discrimination on grounds of disability.
The principle of equal treatment enshrined in the directive in that area applies not to a particular category of person but by reference to the grounds mentioned in the Directive. That interpretation is supported by the wording of Article 13 EC, which constitutes the legal basis of the Directive, and which confers on the Community the competence to take appropriate action to combat discrimination based, inter alia, on disability. Therefore the DDA could apply to persons who cared for a disabled person.
The ECJ considered the other provisions of the Directive which apply only to disabled people. One of the provisions provides that, in order to guarantee compliance with the principle of equal treatment in relation to persons with disabilities, reasonable accommodation (reasonable adjustments under the DDA) are made. This means that employers must take appropriate measures, where needed in a particular case, to enable a person with a disability to have access to, participate in, or advance in employment, or to undergo training, unless such measures would impose a disproportionate burden on the employer.
The ECJ stated that provision related specifically to a disabled person either because they are positive discrimination measures in favour of disabled persons themselves or because they are specific measures which would be rendered meaningless or could prove to be disproportionate if they were not limited to disabled persons only. The measures in question are intended to accommodate the needs of disabled people at the workplace and to adapt the workplace to their disability. Such measures are therefore designed specifically to facilitate and promote the integration of disabled people into the working environment and, for that reason, can only relate to disabled people and to the obligations incumbent on their employers with regard to disabled people.
This decision represents a potentially important extension of the law. It has introduced the possibility of claims from employees who are treated less favourably than their colleagues for reasons related to the fact that they care for a disabled person.
Employers should ensure that employees with dependants who are disabled are not treated less favourably and that any measures offered to other employees are offered to them to avoid any possible claims of discrimination. However if the employee requests other adjustments due to their dependant’s disability, which are not offered to other employees, an employer need not agree as the decision above confirms that reasonable adjustments need only be made in relation to employees who themselves are disabled.
The UK Border Agency will be implementing the new immigration Tier 2 system from November 2008, which will replace the current work permit scheme. Under the new Points-Based System businesses wanting to employ skilled foreign workers from outside Europe and sponsor their entry to the UK must apply for a licence.
The Agency is committed to supporting industry through the introduction of rules to ensure legitimate businesses do not fall foul of the new regime and only those with the skills the country needs will be able to work or study here. Businesses that want to hire illegal workers face huge fines and being barred from hiring workers from outside the EEA.
Earlier this year the Agency unveiled the criteria which businesses will have to meet to become a sponsor under the Points-Based System.
• Any business must register with the Agency as a sponsor before they can bring foreign workers from outside the EEA into the UK to work.
• As a condition of keeping their licence, sponsors will need to alert the Agency if migrants do not comply with their immigration conditions, for example if they disappear or do not turn up for their job or course. Any sponsor that does not comply with this requirement will risk losing their licence.
Most businesses using Tier 2 have been able to register as sponsors since February this year, with all remaining sponsors being able to apply since late July. From November, those who have registered successfully will be able to sponsor new foreign workers to work in the UK or support those already in the UK who want to stay.
To enter the UK under Tier 2 (General) skilled, foreign workers must have:
• Enough points through their qualifications and potential earnings.
• A good grasp of English language.
• Enough money to support themselves for the first month of their stay.
It is important for businesses who wish toemploy people from outside the UK under the Tier 2 system that they apply for the licence in good time as it is likely that if it is left too late they may well find their applications delayed due to a late surge in applicants to the Agency nearer the time.
Case law update - age related harassment - comments in the workplacee
A Scottish debt recovery operative has brought a successful claim against his former employer, Westcot Credit Services of Glasgow for age related harassment. Mr Joe McGee, 62, brought the claim after his line manager, Mr William Fox, said of him in a performance review that, “ambition is not a motivation for Joe, because of his age.” After an internal investigation failed to uphold Mr McGee’s complaint, resolving that Mr Fox hadn’t intentionally meant to discriminate against Mr McGee, but that the wording of the review was incorrect and should be amended accordingly, Mr McGee chose not to appeal the decision as he believed that the company was accepting of an ageist approach among its management.
Mr McGee told the tribunal that several references were made in relation to his age and pay. He alleged that Mr Fox asked him, “What age are you now?” and “Tell me how I can justify your wage?” Mr McGee also claimed that during a meeting involving over 30 members of staff regarding opportunities within the company Mr Fox told Mr McGee “this doesn’t apply to you Joe, you’ll be waiting for death,” although Mr Fox denies this.
Jane Garvie, the Employment Judge said “The Tribunal concluded that the claimant was subjected to harassment in that his age was raised by Mr Fox at the meeting on 11 September 2007. It was not clear to the Tribunal why the issue of the claimant’s age had any relevance to the review of the claimant’s performance which was the sole purpose of the review meeting.”
Mr McGee was awarded £400 in compensation after having his initial award of £750 halved as he did not appeal the decision of the internal investigation. Protection from age discrimination is a relatively new area of employment law, having been introduced to England and Wales in October 2006. This case illustrates that employees still overtly discriminate and make discriminatory comments based on a colleague’s age. The number of claims brought by employees for age related discrimination is increasing. Employers should ensure that their workforce is aware that comments, such as the quotes above, are discriminatory.
Failure to educate a workforce in relation to age discrimination and the failure of an employer to have an equality policy covering age discrimination could result in expensive employment litigation. Should employers require such training or advice on their equality policies please do not hesitate to contact us. Our contact information is at the end of this monthly update.
Pre Employment Discrimination
A graduate who had his initial application for the Strathclyde Police turned down due to his colour blindness has successfully won the right to a tribunal hearing on the grounds of sex discrimination.
Robin Dixon, 26 of East Kilbride, who lost his initial claim of disability discrimination, joins Graeme McCullie 29, whose application to Strathclyde Police was also turned down due to his colour-blindness, in bringing a claim of indirect sex discrimination as men are more prone to suffer from colour-blindness than women.
Chief Inspector Douglas Campbell told Mr Dixon’s previous tribunal that Mr Dixon would have made a good police constable but his application would not be progressed, as there were concerns about his own health and safety, the safety of other officers and the general public. His mother Marie Dixon, from East Kilbride, said: “There is something very wrong here when the force rejects candidates despite the evidence.
His condition means that he only has problems differentiating between shades of green. He is distraught that he has not been accepted after being suitable in every other way.”
Although this case has not yet been heard, it is predicted it could set a precedent for claims against employers who refuse applications on the basis of colour blindness or other such medical condition.
It is best practice for employers not to adopt such a blanket refusal of job applicants based on a medical condition but to assess each individual applicant on their own merits to avoid any claims for disability and/or sex discrimination. This can be done, depending on the condition, by referral to an occupational therapist or an assessment by a GP.
North West Development Agency & MIDAS
In the employment department, we have been assisting the North West Development Agency (NWDA) to promote the region in China.
NWDA leads the economic development and regeneration in the Northwest of England. As a business-led organisation, NWDA provides a crucial link between the needs of businesses and Government policies. As such, a major responsibility for the Agency is to help create an environment in which businesses in the region can flourish through offering business support, encouraging new start-ups, matching skills provision to employer needs and attracting business investment into the region.
NWDA, acting on behalf of the ten Greater Manchester local authorities aims to attract inward investment into the City Region by both promoting Manchester as a leading European business location in its own right and as complementing business services in the UK’s capital, London. We have been working closely with NWDA to produce a guide to UK employment law for Chinese businesses wishing to invest in the UK.
The Immigration, Asylum and Nationality Act 2006 imposes civil and criminal penalties on employers of illegal workers as from 29th February 2008. Under new rules, the penalties will be substantially increased and could be an unlimited fine and/or a prison sentence of up to two years or a civil penalty of up to £10,000 per employee.
In the first 5 months of 2008 there were 137 prosecutions under the new rules, leading to fines totalling £500,000, 10 times more than in 2007 and double the total for the previous decade.
Checks on potential employees
Employers should carry out checks on all potential employees, as this not only protects the employer from liability of a civil penalty, but also demonstrates consistent, transparent and non-discriminatory recruitment practices.
The Code of Civil Penalties for Employers published by the UK Border Agency has been approved by the Secretary of State and laid before Parliament. The Code itself does not impose any legal obligations on employers, nor is it an authoritative statement of the law.
However, the Code can be used as evidence in legal proceedings. The Act provides employers with a statutory excuse against liability for a civil penalty. In order to establish this excuse an employer must:
• Check and copy one of the original documents, or a specified combination of original documents from List A or List B (see Appendix 1 and 2 of the Code) before employing that person.
• Make a paper copy, or electronic record of the document(s) and store it securely.
• Undertake basic visual checks to ensure that the document(s) relate to the applicant by comparing any photographs in the document(s) and dates of birth against the appearance and apparent age of the applicant.
• Check that any UK Government endorsements (stamps, vignettes etc.) entitle the potential employee to do the type of work offered and that any expiry date has not passed.
• For identity cards, passports and travel documents, a copy should be taken of; the document’s front cover; any page containing the holder’s personal details including nationality, his or her photograph, date of birth and/or signature; any biometric details; the date of expiry; any relevant UK immigration endorsements. All other documents should be copied in their entirety.
If the employer obtains documents from List A they will not need to carry out any subsequent document checks as the documents from that list would show that there are no time restrictions on the individual’s ability to take up employment in the UK.
Where an employeeproduces an original document or documents from List B, the employer must note the date on which they have carried out the original document check. In order to retain the statutory excuse against a penalty for employing that individual, the employer must carry out a follow-up check at least once every 12 months after the initial check. The documents from List B show that there are restrictions on the length of time the individual can stay in the UK and the employer will need to ensure that the employee has retained their entitlement to work.
The same visual checks should be carried out to ensure that each document is not false and that it relates to the holder. The employer should take another copy of the document, recording the date on which the check was made. If the employee leaves the employment the documents must be kept for a period of two years.
The checks the employer needs to make to claim the statutory excuse are in most cases straightforward and can be built into the employers normal employment procedures. European Nationals In relation to employing nationals from Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia, as they are not subject to immigration control, the Immigration, Asylum and Nationality Act 2006 does not apply to them. However an employer would be committing an offence if they employ a national from one of the above countries and the employee does not have the appropriate authorisation to work in the UK. The employer must check the employee’s documents to ensure that he has the appropriate authorisation from the UK Border Agency to work in the UK. If the checks are carried out and it transpires the employee is not in fact allowed to work in the UK the employer would have a statutory defence. If the employer fails to carry out the appropriate checks and the employee does not have the appropriate authorisation a penalty of up to £5000 can be imposed.
If an employer does not make these checks at the point of recruitment, or within 1 month in relation to nationals from the European countries listed above, the employer will not have the benefit of the statutory excuse if they are later found to be employing illegal migrant workers.
It is important that employers ensure all necessary documents are obtained, copied and kept on the employee’s personnel files so that if any issues arise in the future (ie counterfeit documents) the employer can rely on the defence available.
North east councils’ pay protection schemes judged to be unlawful
In a landmark decision the Court of Appeal in the joint cases of Bainbridge v Redcar & Cleveland Borough Council and Surtees v Middlesbrough Borough Council have handed down important guidance regarding the legality of pay protection schemes.
Employers will be concerned by this decision as the Court of Appeal judged that the pay protection arrangements in both Redcar & Cleveland and Middlesbrough Borough Councils discriminated against women and could not be justified. The barrister representing the claimants in this case estimated that the councils involved may have to pay £2m in compensation to the women who bought the claims. In addition, tens of thousands of claims against public sector employers are ‘on hold’ pending this decision.
However, the Court of Appeal offered employers some relief, making it clear that, in principle, sex discriminatory pay protection scheme could be capable of justification. This case considered pay protection arrangements put in place by two borough councils in the North East of England. Following national guidelines on the implementation of the single status agreement, these councils conducted job evaluations for members of staff.
Inevitably, this led to some posts being downgraded. In order to cushion the blow of the fall in salary for such members of staff, the councils put in place pay protection for a specific period.
As is the case with many job evaluation schemes, it was mainly male members of staff that benefitted from the pay protection arrangements, as, historically, female dominated posts, such as kitchen assistants, were paid less than equivalent predominantly male posts, such as gardeners. Therefore, following the job evaluation exercise, it was the predominately male post that were downgraded and benefited from the cushion of the pay protection scheme.
The claimants in these cases were female council employees. They argued that it was unlawful for their employers to operate pay protection schemes as they unfairly protected the male dominated posts’ pay and continued the discrimination against women. The Court of Appeal confirmed that when the legality of such pay protection schemes is considered, a two stage approach must be taken:
1. An employment tribunal must assess whether the pay protection arrangements are sex discriminatory. The Tribunal will need to look at whether the arrangements directly or indirectly treat women less favourably than men i.e. are women disadvantaged by the arrangements.
2. If the answer to the first question is yes, the tribunal must look at whether the arrangements can be objectively justified irrespective of the fact that they discriminate against women.
The Court of Appeal stated that when the tribunal considers the first part of the above test, the employer’s knowledge and motives in putting the pay protection schemes in place are irrelevant. The key issue is whether the arrangements discriminate against women, not whether the employer was aware of any discrimination. If the arrangements do not discriminate on the grounds of sex then the claims for equal pay will fail. Knowledge, intention and motive are only relevant when considering the second part of the approach in relation to the issue of justification.
In both cases the initial judgment of the employment tribunals was that the pay protection schemes were sex discriminatory and could not be justified. The Court of Appeal ruled that whether discrimination is justified depends on findings of fact by the original Tribunal and unless the tribunal’s decision is perverse, it cannot be overturned on appeal. Therefore, this case is not binding law that pay protection schemes are unjustifiable, it is merely stating that each pay protection scheme challenged in an equal pay claim should be considered on its own merits using the two stage test set out above.
The Court of Appeal’s decision in relation to the two-stage approach sets a high hurdle for employers to overcome when their pay protection arrangements are challenged in equal pay claims. When considering the second stage of the approach, a key factor will be the employer’s knowledge and motive when the scheme was put in place.
One of the main reasons why the employers’ schemes might not be justified in both these claims was that the employers understood when the scheme was put in place that their pay scales were discriminating against females. Therefore, they had knowledge at that time that the pay protection arrangements could carry on such discrimination against female employees.
Following this judgement it is difficult to assess in what circumstance a pay protection policy that discriminates against female employees will be considered to be justified by an employment tribunal. In order to be objectively justified, a difference in pay:
• Must correspond to a real need on the part of the employer.
• Must be an appropriate means of achieving the objective pursued.
• Must be necessary to that end.
Therefore, a pay protection policy that discriminates against women may not be justified when it is out of proportion to the need to cushion the reduction in pay, for example, if it lasts an unreasonable amount of time.
The lesson learned from these joint cases is that evidence that the employer realised their previous pay policies were discriminatory when they introduced the pay protection policy will undermine their attempt to justify it.
Employers involved in equal pay disputes or considering introducing a pay protection policy, for example, following a re-grading exercise or the merger of two or more businesses, should consider taking legal advice regarding possible employment law implications. Freeth Cartwright LLP have extensive experience of successfully defending local authorities, NHS trusts and private sector employers in equal pay litigation.
If you would like to discuss this important decision further and how it may impact on your organisation, please contact us. Our contact details are at the end of this monthly update.
Selvarajan Overruled - Statutory Dismissal Procedure
In the white hot heat that is employment law, new legislation is introduced almost every month and important court decisions can be overturned within a matter of weeks.
In last month’s issue we wrote with regard to the EAT decision in Yorkshire Housing v Swanson where the EAT held that in the context of the Statutory Dismissal Regulations, ‘non completion’ of the procedures meant the employer’s failure to comply with the requirements of the statutory procedures, including the delay provisions. Therefore, the unreasonable delay did constitute non completion and the dismissal was automatically unfair.
However, the Court of Appeal have overruled the EAT in Selvarajan v Wilmot. The case considers the same issue as in the case above as to whether “unreasonable delay” in dealing with a step under the statutory procedures makes a dismissal automatically unfair where the statutory procedure is nonetheless completed, albeit with unreasonable delay (in Selvarajan the alleged unreasonable delay was 4 months in dealing with an appeal).
Paragraph 12 of Schedule 2 of the Employment Act 2002 requires each step under any of the statutory procedures to be taken “without unreasonable delay”. If an employer fails to complete a step of the statutory dismissal procedure, the dismissal will be automatically unfair.
The Court of Appeal held that if an employer does not comply with the requirement to complete a step in the procedure without unreasonable delay, even though the step is completed (with unreasonable delay), it does not make the dismissal automatically unfair. Whether there was unreasonable delay was not relevant to the question of whether the statutory procedure was completed. If the procedure was completed, no matter how unreasonably delayed, the dismissal is not automatically unfair.
However it is important to appreciate that the above only deals with automatic unfairness. A long delay could still potentially contribute to a dismissal being unfair under the normal fairness test in s. 98(4) ERA 1996. It is therefore best to ensure that the whole process is completed without delay.
Announcement - North West Collaborative Procurement Hub
We are pleased to announce that Freeth Cartwright have recently been included in the panel of recommended solicitors for the North West Collaborative Procurement Hub. The CPH is a collaborative purchasing agency owned and funded by 52 NHS Trusts in the north-west of England and 10 Regional Ambulance Trusts covering the whole of England.
The CPH works with the Trusts on the purchase of goods and services and deliver significant savings which can be used to reinvest in enhanced patient care. The CPH work collaboratively with Trust staff who specify the products or services which are right for them.
We’d like to thank all of our Clients who assisted with and supported our appointment.
If you want to know more…
Speak to us today and find out what we can do for you. Please contact any of the following:
David Potter, Cumberland Court, 80 Mount Street, Nottingham NG1 6HH
Tel: 0115 936 9389
Fax: 0115 859 9617
david.potter@freethcartwright.co.uk
Joanne Kay, Floor 2, West Point, Cardinal Square, 10 Nottingham Road, Derby DE1 3QT
Tel: 0845 634 1724
Fax: 0115 859 9617
joanne.kay@freethcartwright.co.uk
Julian Middleton, One Colton Square, Leicester, LE1 1QH
Tel: 0116 248 1115
Fax: 0845 634 2590
julian.middleton@freethcartwright.co.uk
Pat Jones, First Floor, St James Building, 61-95 Oxford Street, Manchester M1 6FQ
Tel: 0845 634 2561
Fax: 0845 634 2541
pat.jones@freethcartwright.co.uk
Vanessa DiCuffa, One Victoria Square, Birmingham, B1 1BD
Tel: 0845 634 2584
Fax: 0845 634 2576
vanessa.dicuffa@freethcartwright.co.uk