UK: Employment Briefing - June 2010

Last Updated: 30 September 2010
Article by Brian Gegg, Jesper Christensen and Marc Meryon

Originally published in June 2010

Age Discrimination – Requirement for a Degree

In Homer v Chief Constable of West Yorkshire Police the Court of Appeal considered whether an employee in his 60s was discriminated against when his employer introduced a requirement that the possession of a degree was a requirement for career progression and pay increments.

Mr Homer was a long serving legal adviser for the Police National Legal Database (PNLD) and had previously worked as a police officer for 30 years. When Mr Homer was appointed as legal adviser the requirements for the post were that the post holder should hold a law degree or equivalent qualification or have exceptional experience/ skills in criminal law. Mr Homer qualified by virtue of the latter requirement.

The PNLD experienced difficulties recruiting and retaining legal advisers and asked an external organisation to conduct a review. As a result a new career structure was introduced with three thresholds for re-grading. Mr Homer satisfied the first two but not the third which was the need to have a law degree. Mr Homer did not want to embark upon a law degree as he would not qualify until he was past retirement age (and therefore unable to take advantage of increased pay which accompanied re-grading). Whilst sympathetic, the PNLD denied Mr Homer the re-grading and he brought a claim for indirect age discrimination against the Chief Constable for West Yorkshire.

The Court of Appeal upheld the decision of the EAT that there had been no particular disadvantage to people in Mr Homer's age group (60-65). The EAT held that all people without a law degree were treated in the same way and that the financial disadvantage resulting from not being able to complete a degree before retirement was the inevitable consequence of age, not of age discrimination. The Court of Appeal, endorsing this decision, noted that, whatever his age on the introduction of the provision, criterion or practice, Mr Homer would have failed to meet the third threshold unless he obtained a law degree. Disadvantage did not result from requiring possession of a degree or from age at all but from impending withdrawal from the marketplace.

Age Discrimination – Retirement Age of 40 was Direct Age Discrimination

A tribunal in Martin v Professional Game Match Officials Limited (PGMOL) found that a retirement age of 48 for assistant football referees was direct age discrimination. It was accepted by the parties that PGMOL had adopted a discriminatory retirement age and the issue was whether this could be justified. Match officials were required to meet strict standards of fitness and were tested at the start of each season.

The tribunal considered that the only aim put forward by PGMOL which satisfied the social or public policy objective (as established by ECJ case law) was the creation of a career route for match officials. The tribunal found that PGMOL was unable to satisfy it that the retirement age policy was a proportionate means to that legitimate aim. It went on to note that there were other, less discriminatory, alternatives which could have achieved that aim. It stated that PGMOL could have introduced objective fitness and competence assessments which had no reference to age. It also noted that the Dutch authorities had dispensed with an upper age limit and this appeared to have caused no problems.

It is notable that the tribunal in this case argued that to justify direct age discrimination, a legitimate aim must have some social or public policy objective. This is likely to make it increasingly harder for employers to justify a fixed retirement age less than the default retirement age (which the coalition government has confirmed it will remove).

Disability Discrimination – Reasonable Adjustments May Include Swapping Roles

The EAT in Chief Constable of South Yorkshire Police v Jelic decided that, owing to the unique 'service' nature of the police force, a non disabled employee should have been obliged to swap jobs with a disabled employee to satisfy the requirement to make reasonable adjustments.

In this case, Mr Jelic was a serving police officer who developed chronic anxiety syndrome. When on non public facing duties his symptoms abated and after diagnosis of his illness he carried out his duties on the Community Service desk for the Safer Neighbourhood Unit (SNU) with little face to face contact with the public. Over time however the role of SNU officers evolved and they were required to deal directly with incidents and with members of the public. A decision was taken to retire Mr Jelic on an ill health pension. He brought a claim for disability discrimination by reason of the force's failure to make reasonable adjustments.

The EAT held that it would have been a reasonable adjustment to swap Mr Jelic's job with that of PC Franklin who held a non client facing job. It upheld the tribunal's finding that whilst due regard would have to be had to PC Franklin's views, he could, in a disciplined service, be simply ordered to move, whether or not he liked it. The EAT noted that it would not always be a reasonable adjustment to swap jobs in this way but that the police force was a disciplined service and police officers had a duty to obey lawful orders. Whilst this case appears to extend the duty to make reasonable adjustments to consider swapping jobs, this is likely only to apply to certain classes of employer.

TUPE 2006 Service Provision Change

The issue whether there was a service provision transfer of panel work from one law firm to another was considered by the EAT in Ward Hadaway Solicitors v Love. Ward Hadaway was on a panel of four firms of solicitors providing services which included investigation, preparation and advocacy to the Nursing & Midwifery Council (NMC). The NMC was not obliged to allocate any case to Ward Hadaway nor was Ward Hadaway obliged to accept any case. The NMC decided to re-tender and chose Capsticks as a single provider. The work was different in that much post preparation work was taken back in house and advocacy was carried out by the NMC legal team. Ward Hadaway continued with its existing workload but was not given any new work.

The issue was whether employees working on the NMC contract had been the subject of a TUPE service provision transfer. The Employment Tribunal had separated the work in progress and the expectation of future work and held that only the former constituted activities within the meaning of TUPE 2006. It found that the future likelihood of legal services could not be considered to be activities carried out by Ward Hadaway. If it was wrong on that point, the tribunal also found that there was less work at an earlier stage done by Capsticks than was carried out previously and the work was done by a paralegal rather than by a qualified solicitor as at Ward Hadaway.

The EAT agreed with the tribunal's findings, noting that the emphasis on Ward Hadaway's availability to do work for the NMC pointed towards an economic entity along the lines of old TUPE (now Regulation 3(1)(a)). When considering whether there had been a service provision change the tribunal correctly concentrated on the relevant activities and found that a future expectation of work could not fall within this category.

ECJ Rules No Reduction in the Right to Accrued Annual Leave when Moving to Part Time Work

In Zentralbetriebsrat der Landeskrankenhäuser Tirols v Land Tirol the ECJ held that Austrian national law which reduced accrued statutory paid holiday pro rata when an employee transferred from full time to part time hours was in breach of the Framework Agreement on part time work. The ECJ held that the pro rata principle could not be applied retrospectively to rights which have already accrued.

The ECJ also considered whether national law which provides that workers who take two years' parental leave lose the entitlement to annual leave from the year before the birth of the baby was in breach of the Framework Agreement. The ECJ held that the Framework Agreement precluded such a provision noting that the right to paid annual leave was an important one and must be retained so that it was available after the parental leave period. Following this reasoning it would seem that workers must be able to carry forward accrued statutory (and, arguably, contractual) holiday entitlement until after their parental leave has ended.

Court of Appeal Confirms That a Union Could Specify Continuous and Discontinuous Action in Same Notice

The Court of Appeal has held in Milford Haven Port Authority v UNITE that a notice to an employer indicating that industrial action will be taken must clearly specify whether the action will be continuous or discontinuous. However, it is sufficient to use one notice for both forms of action providing, of course, that the notice otherwise satisfied the requirements of the legislation.

Court of Appeal Rules on Performance Related Bonus

In Khatri v Cooperatieve Centrale Raifessen-Boerenleenbank BA the Court of Appeal considered an application for summary judgment in relation to a claim for a bonus allegedly due under the terms of an employment contract. The Court of Appeal allowed the claim for summary judgment to proceed on the basis that the principles were satisfied. This was a case which would turn on the construction of the contract.

Mr Khatri was a trader for the Bank. His amended contract (signed by him) contained provision for a guaranteed bonus and a performance related bonus calculated according to an agreed formula. Mr Khatri was warned that his job was at risk because of a potential redundancy. He was then advised that he was no longer at risk and had been successfully redeployed although in reality he carried on the same work from the same desk save that he reported to a different person. A letter was sent to him detailing new terms and conditions, crucially with different bonus provisions. Mr Khatri did not sign the letter nor was he pressed to do so. After around 3 months Mr Khatri made clear that he did not accept the revised terms and shortly afterwards he was dismissed by reason of redundancy.

The Court of Appeal considered that the contract was clear that the performance related bonus was not intended as a one-off. Further, none of the acts by either Mr Khatri or the Bank showed acceptance of the new terms. Mr Khatri carried on doing the same job, albeit for a different superior. Further, whilst he had signed the first amended contract he pointedly failed to sign the later one and the Bank did not query this with him. The new terms were markedly worse than the earlier ones since they also sought to impose restrictive covenants upon him. The Court stated that his conduct in continuing as if nothing had changed could not spell out acceptance in these circumstances. Mr Khatri was entitled to his EUR 1.6m bonus.

Tribunal Follows Stringer

A tribunal in Rawlings v The Direct Garage Door Company Ltd has applied Stringer, holding that a worker who had been on sick leave for the last 15 months of his employment was entitled to statutory holiday pay in respect of that entire period. The tribunal noted that it is clear from the ECJ's decision in Stringer that the Working Time Regulations do not properly implement the Working Time Directive in relation to paid leave entitlement in a year in which the employee is not able to take paid leave.

And Finally...

The New Government: What to Expect?

A change in government heralds a change in the direction of legislation. The coalition government has indicated that it will place emphasis on family friendly policies and both parties have indicated their wish to extend the right to request flexible working.

With regard to the Equality Act, Liberal Democrats and Conservatives varied in their enthusiasm for all of the changes encompassed by the Act. Most notably, the Conservatives have indicated that they will not bring into force the public sector socio-economic duty and rules on positive action.

The coalition agreement states that the default retirement age will be phased out but it is not yet clear what approach will be taken.

The coalition government has also indicated that it will address the issue of whistleblowing in the public sector, affording greater protection for bona fide whistleblowers.

The coalition agreement states that there should be no further transfer of sovereignty or powers over the course of the next Parliament and that they will work to limit the application of the Working Time Directive in the UK. The Conservatives have also stated that they would negotiate with EU with the aim of returning control of employment legislation to the UK.

With regard to human rights, it is unclear what direction will be followed since the Conservatives want to replace the Human Rights Act with a Bill of Rights and the Liberal Democrats want to protect the Act.

The Conservatives have also indicated that they wish to review the Agency Workers Regulations. They also wish to limit the effect of Service Provision Changes in TUPE 2006.

HSE Guidance on Working Time Regulations

The Health and Safety Executive has updated its guidance on the Working Time Regulations 1998 (The Working Time Regulations 1998: Guidance on the legislation, HSE).

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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