UK: Employment Briefing July 2011

Last Updated: 21 July 2011
Article by Brian Gegg and Jesper Christensen

Negligent misstatement

An interesting case in the High Court examined the situation where an ex-employer badmouths a former employee several years after employment has ended.

In McKie v Swindon College, Mr Mckie had worked for Swindon College as a contextual studies coordinator until 2002 when he left to work for Bath City College. At that time he received an excellent reference from Swindon College. In 2007 he left Bath City College to work at Bristol City College. In May 2008 he was offered and accepted a job as director of studies at the University of Bath.

Two or three weeks later an email was sent by the HR manager at Swindon College (who had never met Mr McKie) to the University of Bath. It was completely damning and referred to 'very real safeguarding concerns' and 'serious staff relationship problems'. As a result, Mr McKie was summarily dismissed by the University of Bath. The High Court noted, when it considered the circumstances, that the procedure adopted at Swindon College giving rise to the sending of the email could be described as slapdash, sloppy and unfair. At trial, Mr McKie produced evidence that indicated that the contents of the email were largely fallacious.

When considering what remedy Mr McKie might have, the High Court ruled out the possibility of pursuing a defamation claim since Mr McKie would have to show express malice, which he could not prove. The same problem arose with the claim of malicious falsehood where malice needed to be shown.

The High Court stated quite clearly that the law relating to the giving of references was not relevant since this was not a reference. In this case, the court applied the rule in Hedley Byrne v Heller giving rise to the claim of negligent misstatement. Applying the guidelines in the case of Caparo Industries plc v Dickman, the court considered the three stage test:

  • What damage did Mr McKie suffer? He lost his job which gave rise to significant loss of earnings.
  • Proximity or neighbourhood. Whilst six years had elapsed since Mr McKie was employed by Swindon College, Swindon College itself brought about the relevant degree of proximity by its actions. The mere fact a number of years had gone by was not sufficient to break proximity.
  • Was it fair, just and reasonable to impose a duty of care? In the circumstances, it was.

This case is interesting because it emphasises a duty of care to be honest and fair when making statements about former members of staff even when this is not in the context of the giving of a reference and when a substantial period of time has elapsed after the employment relationship has ended. Ex employers need to be careful about making damaging statements about former staff even outside the context of reference giving.

Protection from harassment: course of conduct

In Marinello v City of Edinburgh Council the Inner House of the Court of Session has held that an interval of 17 months between incidents of harrassment at work did not automatically mean that there could not be a course of conduct for the purposes of protection under the Protection from Harassment Act 1997.

Further, it was vital for a court to look at the course of conduct as a whole, rather than assess each individual incident separately, each of which, on its own, may not be sufficient to be considered as an act of harassment.

EAT considers liability for agency worker's discriminatory acts

The EAT in Mahood v Irish Centre Housing Ltd held that under discrimination legislation, an employer could be held liable for the discriminatory acts of an agency worker in a situation where that worker was exercising the authority of, or being controlled by, the employer or where he had the employer's authority to do the acts (which were capable of being done in a discriminatory manner just as they were capable of being done in a lawful manner.)

In this case, Mr Mahood, an Irish protestant, worked as a project worker for ICH Ltd. Mr Toubkin was taken on as a temporary worker through an employment agency. Mr Toubkin and Mr Mahood had an uneasy working relationship and Mr Mahood complained that Mr Toubkin regularly made derogatory remarks about protestants and Irish people. Following a further altercation, Mr Toubkin's engagement was terminated. Shortly afterwards, Mr Mahood's employment was terminated for unrelated reasons (in connection with a CRB check). Mr Mahood brought claims for discrimination and victimisation.

When considering whether ICH Ltd should be held liable for the discriminatory acts of Mr Toubkin the EAT noted that it was necessary to give a purposive construction to discrimination statutes. A course of employment should be given a wider definition than at common law and there was no need for it to be confined to a wrongful act authorised by the employer or a wrongful unauthorised mode of doing some act authorised by the employer. With regard to the statutory defence that an employer would not be liable if it took such steps as were reasonably practicable to prevent the agency worker from doing the discriminatory acts in question, this defence was limited to matters done in order to prevent a discriminatory act. In other words, only steps taken before the act took place could be taken into account.

This case illustrates the extent of employer's liability for discriminatory acts of its agency staff. Employers should put in place similar safeguards against discrimination in relation to other workers as they would to their employees. Further, putting matters right after the event will not suffice to get an employer off the hook.

Sharon Shoesmith

As reported widely in the press, the Court of Appeal has allowed Sharon Shoesmith's appeal against the Secretary of State and Haringey London Borough Council relating to judicial review of the decision to dismiss her in the light of the death of Baby P. Her appeal against OFSTED failed.

With regard to the then Secretary of State, Ed Balls, Ms Shoesmith claimed that he had not afforded Ms Shoesmith with any procedural safeguards before directing that Haringey should dismiss her. Further, that he impermissibly took into account a petition raised by the Sun newspaper that she should be sacked. She also claimed that the High Court had erred when it held that even if there had been no procedural unfairness, the Secretary of State would still have reached the same decision.

Against Haringey, Ms Shoesmith argued that Haringey's treatment of her was amenable to judicial review and that the judicial review application should be allowed irrespective of any alternative remedy in the Employment Tribunal.

The Court of Appeal held that in relation to the Secretary of State, Ms Shoesmith's ability to comment was limited and she should have been given full opportunity to comment and answer the Ofsted allegations. The procedure leading up to the directions given by the Secretary of State was therefore unfair. However, the Court held that it was not necessarily unfair for the Secretary of State to have taken the Sun's petition into account. The Court of Appeal disagreed with the High Court that, had Ms Shoesmith made representations, it would have made no difference.

With regard to Haringey, the Court of Appeal held that the High Court's finding that proceedings in the Employment Tribunal would afford Ms Shoesmith a better remedy was flawed. The relief offered by judicial review could include a quashing of the decision to dismiss her and the dismissal would be null and void.

The Court of Appeal therefore ruled that Ms Shoesmith's application for judicial review should succeed and she should be entitled to a declaration that her dismissal was unlawful as well as to compensation.

This is unlikely to be the end of the Shoesmith appeals as it has been indicated that the government and Haringey intend to appeal on the basis that due process had been followed.

Compensation for career long loss

The Court of Appeal has given some useful guidance on how to calculate long term loss in Wardle v Credit Agricole Corporate and Investment Bank. When reviewing the tribunal's and EAT's decisions on remedy, the Court of Appeal held that the tribunal had been wrong to assess Mr Wardle's loss by reference to his whole career. It would rarely be appropriate to assess compensation over a career lifetime. The tribunal had found that Mr Wardle had a 70% chance of returning to his banking career by the end of 2011, given the upturn in the market. Therefore, it should have awarded compensation for future loss up to that date only.

Costs relevant for objective justification

In Cherfi v G4S Security Services Ltd, the EAT held that G4S's request to a Muslim security guard to man a site throughout Friday lunchtimes when he wished to attend his Mosque was, in the circumstances, objectively justifiable. G4S had offered to change Mr Cherfi's working pattern to Monday to Thursday with the option to work Saturday or Sunday, which he had refused, and there was a prayer room available on site. The EAT upheld the tribunal's finding that the requirement to be on site at Friday lunchtimes was objectively justifiable, noting that whilst G4S had not relied on cost considerations alone, cost by itself might justify a provision, criterion or practice which is indirectly discriminatory if it satisfied the proportionality test.

And finally...

Consultation on parental leave and flexible working

The government has published a consultation document containing proposals to alter the system of maternity/ parental leave, flexible working, annual leave and equal pay. It is intended that the new system of maternity/parental leave will be introduced in April 2015.

The consultation proposes that mothers should take the first 18 week period of maternity leave and thereafter a 34 week period of parental leave could be shared between both parents. The government also proposes to extend the right to work flexibly to all employees. It is envisaged that employers who receive numerous requests will be entitled to prioritise them.

The government also intends to bring the law in step with recent case law and the consultation provides that where a worker is unable to take holiday during the leave year because of sickness, they will be able to carry statutory leave forward into the next leave year. The consultation also seeks views on businesses being allowed to buy out up to 1.6 weeks of statutory leave on justifiable business grounds.

Government review of discrimination compensation, collective redundancies and TUPE

The government has stated its intention to review whether discrimination compensation should be capped, whether the 90 day consultation period for collective redundancies is excessive and whether TUPE should be revisited. Any review will of course need to operate within the constraints imposed by European law and so it is unlikely that there will be any substantive changes.

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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