Employment Update - September 2015

15 minute read
28 September 2015

Our employment experts bring you their monthly update.

This month's update covers:

Employers can redeploy permanent employees in agency workers' posts

The Agency Workers Regulations 2010 (AWR) provide that from the first day of their assignment, agency workers are entitled to information about vacancies in the hirer's organisation to give them the "same opportunity" as other workers to find permanent employment. This can be done by way of a general announcement posted in a suitable place at the workplace.

What is the scope of this obligation? The Employment Appeal Tribunal (EAT) has now confirmed in Coles v Ministry of Defence (MoD) that the AWR does not prevent an employer giving preference for vacant posts to permanent employees in need of redeployment. Regulation 13 of the AWR simply provides a right to information. It does not give agency workers a right to have an interview or preferential consideration for permanent employment. In particular, the AWR does not prevent an employer from giving priority to permanent staff who have been placed in a redeployment pool during a restructuring exercise.

In this case, the MoD carried out a substantial restructuring exercise with over 500 permanent staff put in a redeployment pool. Mr Coles had been working at the MoD as an agency worker for eight years. Civil Service recruitment has four stages, with the first three stages giving priority to internal applicants and jobs being opened up to external applicants only under stage four.

Jobs are advertised on the Civil Service Jobs website to which agency workers had access. Mr Coles discovered that the post he was fulfilling as an agency worker was being advertised on the Civil Service Jobs website. However, Mr Coles would not be able to apply for the job unless it was advertised externally under stage four of the Civil Service recruitment scheme. The post was given to an internal applicant who had been put in the redeployment pool and had applied under stage one. Mr Coles' assignment was therefore terminated. Mr Coles issued a claim for breach of the AWR.

Rejecting the claim, the EAT confirmed that while the AWR requires employers to provide agency workers with information about relevant vacancies, they do not require equality of opportunity during the selection process with internal applicants who are permanent members of staff. The AWR provide agency workers with a right to information about vacant posts. The AWR do not confer any additional rights on an agency worker to have an interview or to be considered for employment.

The AWR does not prevent an employer from giving priority over agency workers to permanent staff who have been placed in a redeployment pool during a restructuring. Indeed, it is a fundamentally good working practice to allow employers to protect permanent employees' positions in a restructuring exercise.

Permanently incapacitated employee was not assigned to a grouping under TUPE

In BT Managed Services Ltd (BTMS) v Edwards, the Employment Appeal Tribunal (EAT) has found that an employee who had been off work for six years and had no prospect of returning to work was not "assigned" to an organised grouping for the purposes of a service provision change under the Transfer of Undertaking (Protection of Employment) Regulations 2006 (TUPE).

In this case, Mr Edwards was employed by BTMS on a domestic network outsource (DNO) contract. He last worked in 2008. By 2010 it was clear to managers that Mr Edwards would never be able to return to work, however, he remained "on the books" so that he could continue to receive what the managers believed to be a contractual entitlement to permanent health payments until he reached retirement age (under the PHI policy the insurer only paid four years and BTMS funded additional years). In 2013 the DNO contract transferred to Ericsson.

As there was no prospect of Mr Edwards returning to work, did his employment transfer with the transfer of the DNO contract? No. The EAT concluded that to be assigned to a grouping:

  • something more than a mere administrative or historical connection is required; and
  • there is some level of participation by the employee in the activities which are the principal purpose of the organised grouping; or if the employee is temporarily absent, an expectation that the employee will, at some point in the future, carry out those activities.

In this case, the employee was "permanently" unable to return to work and could have no further involvement in the economic activity performed by the grouping.

As the EAT stressed, simply because an employee is on long term sick leave at the time of a service provision change does not necessarily mean they are not assigned to the transferred organised grouping. In many cases, the absence could be temporary, albeit long-term. The key is to distinguish cases where an employee is permanently unable to return to work from situations where an employee is on long-term sick leave but may return.

The role of HR in a disciplinary investigation

Once a decision has been taken that an investigation into an employee's conduct is necessary, the employer will need to consider who should conduct the disciplinary hearing. Often the employee’s immediate line manager will be the most appropriate person, sometimes a member of the Human Resources Department may be appropriate. 

Where a line manager is the disciplinary officer, it is common for them to consult the HR department for guidance in the process. But to what extent should HR intervene?

In Ramphal v The Department of Transport, a manager was appointed to act as both the investigatory and disciplinary officer into alleged misuse of expenses by Mr Ramphal. The manager met with HR officers to familiarise himself with the disciplinary procedure, and, in particular, noted the distinctions between misconduct, gross misconduct and the appropriate penalties.

Following the disciplinary hearing, the manager's report was sent to HR. Although this report was partly critical, it contained a number of favourable findings in relation to Mr Ramphal and recommended a finding of misconduct, with the sanction of a final warning. There followed approximately six months of communications between HR and the manager, leading to a complete change of view on the manager's factual findings and recommendations. HR suggested amendments whereby favourable comments were removed and replaced with critical comments, with the recommended finding changed to gross negligence and sanction of summary dismissal.

Mr Ramphal was dismissed and brought a claim for unfair dismissal. Overturning the tribunal's finding of a fair dismissal, the EAT states:

"an Investigating Officer is entitled to call for advice from Human Resources; but Human Resources must be very careful to limit advice essentially to questions of law and procedure and process and to avoid straying into areas of culpability, let alone advising on what was the appropriate sanction as to appropriate findings of fact in relation to culpability insofar as the advice went beyond addressing issues of consistency."

In this case, the dramatic change in the manager's approach after intervention by HR was "disturbing". The changes were so striking that they gave rise to an inference of improper influence.

What does this mean?

For managers acting as investigating and disciplinary officers, having the support of an HR team is invaluable. A disciplinary officer is entitled to call for advice from HR but HR must be aware of the limitations of their role.  

HR personnel are often faced with the question "What would you do?" HR can continue to provide guidance on the factors which should be taken into account when considering disciplinary sanctions such as:

  • need to evaluate the evidence;
  • nature/seriousness of the misconduct
  • impact of the misconduct on the organisation
  • consideration of mitigating circumstance;
  • the employee's previous record and length of service;
  • penalties applied in the past for like-for-like cases.

However, it is not HR's role to evaluate evidence or make decisions on the manager's behalf. HR needs to be mindful of crossing the line between providing advice and influencing an outcome.

Employment Tribunal fees here to stay?  Yes, but…

Following the introduction of tribunal fees at the end of July 2013, we have seen a very significant decrease in the number of tribunal claims. Unison has now failed in its challenge to the introduction of fees in the High Court twice, with its appeal to the Court of Appeal also now failing.

This summer the Court of Appeal rejected arguments put forward by Unison that fees prevented claimants from having access to justice, that the regime was indirectly discriminatory and that the Lord Chancellor had failed to satisfy the public sector equality duty.

The Court of Appeal accepted that the decline in the volume of tribunal claims was "startling". However, the court considered that there was not sufficient evidence before it to demonstrate that any individual found it impossible to bring a claim.

Not the end of the challenge

The future of tribunal fees still remains uncertain. Unison has confirmed that it is seeking permission to further appeal to the Supreme Court and aspects of the Court of Appeal judgment suggest there may be scope for fresh challenges from a real potential claimant denied fee remission who was unable to afford the fees.

Also, a Government review of the fees and remission schemes is currently underway. The Court of Appeal expressly stated that if the review finds there are good grounds for concluding that the decline in the number of claims is accounted for by claimants being realistically unable to afford to bring proceedings, the level of fees and/or the remission criteria will need to be revisited.

The Scottish wrinkle

Regardless of the tribunal fees challenge in the English courts, the further proposed devolution of powers to Scotland includes control over the management and operation of all "reserved tribunals" which include employment tribunals. The Scottish National Party has already stated its intention to get rid of tribunal fees. Once the administration of employment tribunals is devolved, this may lead to forum shopping for those claims where it is possible for claims to be issued either in England or Scotland.

Under the current Tribunal Rules, a claim may be presented in Scotland if:

  1. the respondent, or one of the respondents, resides or carries on business in Scotland;
  2. one or more of the acts or omissions complained of took place in Scotland;
  3. the claim relates to a contract under which the work is or has been performed partly in Scotland; or
  4. the Tribunal has jurisdiction to determine the claim by virtue of a connection with Great Britain and the connection in question is at least partly a connection with Scotland.

The story is not over yet.

1 October changes

National Minimum Wage annual increase

From 1 October the NMW rates will increase:

  • For workers who are aged 21 or over from £6.50 to £6.70 per hour
  • For workers who are aged 18 or over (but not yet aged 21) from £5.13 to £5.30 per hour
  • For workers who are under the age of 18 from £3.79 to £3.87 per hour
  • The apprenticeship rate from £2.73 to £3.30 per hour
  • The accommodation amount which is applicable where any employer provides a worker with living accommodation from £5.08 to £5.35 for each day that accommodation is provided

Repeal of the power to make recommendations for the wider workforce in discrimination cases

Also from 1 October, employment tribunals will no longer have the power to make recommendations for the benefit of the wider workforce in successful discrimination cases.

While removing the wider recommendations provision introduced by the Equality Act 2010, the more longstanding power to make recommendations for the benefit of the individual claimant will remain, therefore returning to the position before October 2010.

Recent alerts

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For more detail see our alert A mobile worker's "working" day just got longer

Nightshift working

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This new research highlights the perennial problem of balancing commercial drivers, e.g. to keep production running overnight, with the potential consequences of night shift working on employees' cognitive abilities and the consequent impact on them and others who may be affected by their work.

For more detail see our alert Health and safety and nightshift working - reviewing the risks

Capping public sector termination payments

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For more detail see our alert Capping public sector termination payments – what does it mean for contractors?

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