UK: Employment Law Bulletin - January 2012

Last Updated: 18 January 2012
Article by Thomas Eggar's Employment Team


Here's to 2012 and our first newsletter of the year.

As we sit down to write it, the symbolism of the blank page doesn't escape us. It's impossible not to wonder what's in store for the next 12 months. Will we see fewer unfair dismissal claims once the qualifying period is raised? Will Claimants have to pay to submit an ET1? And what will become of protected conversations?

Despite having good intentions for resolutions and the anticipation of fresh starts, a new year is never going to be a completely blank canvas. The tail end of 2011 brought with it some important employment law decisions which will help shape working practices in the months ahead. So let's start getting to grips with some of them...

Pre-transfer dismissal caught by TUPE - Spaceright v Baillavoine

Spaceright was in administration. Its managing director – the Claimant - was dismissed for redundancy by the administrators who believed that a business without an incumbent MD would be more attractive to potential buyers. But at the time the Claimant was dismissed there was no specific buyer in mind.

Could the dismissal have been for a reason connected with the transfer when a buyer hadn't even been identified? The tribunal said yes and the Employment Appeal Tribunal agreed. The dismissal was held to be automatically unfair. The administrators' desire to make the business more attractive didn't amount to an economic, technical or organisational reason and so Spaceright could not escape liability.

High Court springs into action - Clear Edge v Elliot

Springboard injunctions have traditionally been used as a way of stopping former employees using information they've obtained improperly. A company might apply to the courts for this special sort of injunction when it looks as though an ex-employee might use confidential information to get a head start in competition against them.

Now the High Court has confirmed that these sorts of injunctions aren't limited to enforcing post-termination restrictions. They can apply in response to any contractual breaches by an employee.

In this case the three Defendants were a single team employed by Clear Edge. The company believed that they had conspired to leave and join a new employer and had copied and kept confidential information during their employment. This amounted to a serious breach of the duty of fidelity and, potentially, of their fiduciary duty too.

The High Court granted the springboard injunction because of the real risk of the employees misusing the information. The court said that it's right to intervene in this way to prevent an employer suffering losses because of a former employee's breach of contract. This sort of injunction isn't just for cases where an employee threatens to abuse confidential information.

Overtime ban not necessarily unlawful - Arriva London South v Nicolaou

Mr Nicolaou was a bus driver. He'd refused to opt out of a 48-hour week under the Working Time Regulations but was used to working overtime on days which were designated as rest days. Arriva introduced a policy which said that any employee who had not opted out of the 48-hour week wasn't allowed to work overtime on rest days.

Nicolaou claimed that, because he would never be working more than 48 hours averaged over 26 weeks, he couldn't be penalised by not being allowed to work on rest days. But the Employment Appeal Tribunal found against him. It said that the reason Arriva didn't allow him to work on rest days was not because he had refused to sign the opt-out. It was in order to implement a reasonable policy and to make sure that the Working Time Regulations were being complied with.

A twist on marital discrimination - Dunn v Institute of Cemetery and Crematorium Management

Mrs Dunn raised grievances about changes to contractual sick pay provisions in her contract. Her grievances were rejected and during the appeal process, the company's chief executive made mention of Mrs Dunn's husband (who worked for the same employer) and his out-of-work activities and other behaviour. Mrs Dunn's appeal was rejected and her role was proposed for redundancy. But before the redundancy process was in full swing she resigned, claiming constructive dismissal. She also claimed victimisation under the (then) Sex Discrimination Act – her case was that her employer wanted to make her redundant because she was married to Mr Dunn.

Up to this point, there had really only been protection from discrimination which related to marital status, in other words the fact that a person was or wasn't married. The tribunal held that Mrs Dunn had only been treated less favourably because she was married to Mr Dunn, rather than because of her married status. Her dismissal was held to be unfair but her discrimination claim failed.

This changed on appeal. The Employment Appeal Tribunal held that the marital status provisions cover discrimination based on marriage to a particular person, and not just being married (or not being married, as the case may be).

Keeping schtum's the best option - Customer Systems v Ranson

An employee is about to jump ship and join a competitor. But before this happens, he comes across some confidential information relating to his prospective employer's competition with his existing employer. A quandary. Does he have to pass this information on to his existing employer?

The High Court said no. An employee isn't bound to divulge this because the duty of fidelity to the existing employer does not necessarily trump the duty of confidentiality to the new employer.

Time to Take a Holiday? - Russell v Transocean International Resources

An important decision for all employers of workers who don't follow a standard working pattern.

The employees worked on offshore oil and gas installations, spending two weeks offshore and then two weeks onshore. Each period of time onshore was known as a 'field break". The employer insisted that employees took their annual leave during these field breaks. But the Claimants argued against this. They said that annual leave is a release from an obligation to work and should therefore be taken out of offshore time.

So, should annual leave should be taken out of working time (in this case, time spent offshore) or from non-working time (field breaks)?The Supreme Court found against the employees. It said that a rest period (rest periods include daily rest, weekly rest and annual leave) means any period that isn't working time. It doesn't matter where the employee is and what he's doing during his rest periods, as long as he's not working. So field breaks fell into this category and, as a result, the employer could require workers to take their annual leave during their time onshore.

And Finally... - BGT at the EAT

Not a buzzer or giant red cross in sight as judges at the Employment Appeal Tribunal found against a Britain's Got Talent auditionee. Ms Czikai claimed discrimination, saying that the show had failed to make reasonable adjustments and its broadcasting of her audition amounted to harassment because of the negative attention she suffered as a result.

But there was one fairly hefty obstacle in her claim's way. To succeed, the discrimination must have been at the hands of a prospective employer. Ms Czikai would have to have shown that the audition was a job application. Was it?No, said that EAT. The purpose of auditioning was to progress in a competition; it wasn't an application for a job. Ms Czikai chose to go to the audition and there was no mutual obligation between the parties. The EAT went on to say though that had she become part of the programme's roadshow and been contractually obliged to perform then that would have amounted to employment for discrimination purposes.

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The contents of this article are intended as guidelines for clients and other readers. It is not a substitute for considered advice on specific issues. Consequently, we cannot accept any responsibility for this information or for any errors or omissions.

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