UK: CABLE: Current Awareness Bulletin - November 2018

Last Updated: 23 November 2018
Article by Robert Hill

Most Read Contributor in UK, November 2018

Clyde & Co's UK employment team brings you CABLE, a bulletin keeping you up to date with recent legal developments

Data breach: employer vicariously liable for data breach by rogue employee

The Court of Appeal has found that supermarket chain Morrisons was vicariously liable for the actions of a rogue employee who, driven by a grudge against the company, took payroll data relating to 100,000 employees and published it online.

Mr Skelton (S), an internal auditor and employee of supermarket chain Morrisons (M) deliberately published the personal data of 100,000 employees on a file sharing website and then anonymously sent the data on a CD to 3 newspapers. S was subsequently convicted for criminal misuse of the payroll data and sentenced to 8 years in prison. As soon as M discovered the breach, it took action to take the website down and to protect the data and any financial loss which might result from the disclosures. Despite this, 5500 employees brought a claim against M for S's act of disclosing the data.

The Court of Appeal found that M was vicariously liable for S's wrongful acts. Vicarious liability is where an employer is liable for the wrongful actions of its employees where (1) the employee's actions fall within the "field of activities" entrusted to them and (2) there is a sufficient connection between those wrongs and the employee's employment such that it would be fair to hold the employer vicariously liable. In this case, S had been deliberately entrusted with the payroll data in his role as internal auditor and when he published it online, this was within the "field of activities" assigned to him.

Practical point

Unless and until this decision is reversed on appeal to the Supreme Court, businesses should insure against data breaches because even if you take all reasonable steps to secure the personal data you hold, you may still be liable for breaches caused by rogue employees.

WM Morrison supermarkets PLC v various Claimants

For a detailed update on this decision, see Court of Appeal confirms supermarket vicariously liable for data breach by rogue employee

Vicarious liability: Employer liable for injury caused to employee after an office party

The Court of Appeal decided that a serious assault by the company's managing director at spontaneous post-Christmas party drinks, which resulted in an employee suffering brain damage, was sufficiently connected to the managing director's job for the company to be vicariously liable for the employee's injury.

The company's managing director (MD) assaulted another employee at an unscheduled "drinking session" at a local hotel after a work Christmas party, when there was an argument about internal company politics. The employee suffered brain damage as a result.

The Court of Appeal said that the two key issues to consider are:

  • What was the nature of MD's job - was he acting within the field of the activities assigned to him as managing director?
  • Was there a sufficient connection between his position and his wrongful conduct to make it appropriate for the employer to be liable for reasons of social justice?

The Court concluded that MD's remit and authority were very wide. He was the directing mind and will of the company and had responsibility for all management decisions, including the maintenance of discipline and would have seen the maintenance of his managerial authority as a central part of his role. He had also chosen to wear his "metaphorical managing director's hat" at the drinks as he was lecturing his subordinates about his rights as managing director.

The Court said there was sufficient connection between his position as MD and his wrongful conduct as the drinks followed a work event organised by MD on behalf of the company and he also organised and paid for taxis to the hotel and continued to provide drinks which were paid for by the company.

Practical point

Vicarious liability can arise at informal work-related social events. Employers are more likely to be vicariously liable for the actions of a managing director and other senior managers at these events than more junior staff.

However, the Court emphasised that the facts of this case are unusual. Liability will not always arise when an altercation between colleagues about work leads to an assault, even when one colleague is significantly more senior than the other.

Bellman v Northampton Recruitment Limited

Victimisation claim: was the employee acting dishonestly?

Victimisation occurs when a person (A) subjects another person (B) to a detriment because either:

  • B has done a "protected act", i.e. made an allegation that A has breached discrimination legislation
  • A believes B has done/ may do a protected act

But giving false evidence or information or making a false allegation is not a protected act if this was given or made in bad faith.

Mr Saad (S) was training to be a consultant surgeon. He raised a grievance alleging he had suffered racial or religious discrimination. The Tribunal decided that the allegation was false, and that, although he subjectively believed the alleged racist comment had been made, that belief was not reasonable. It also concluded he had raised the grievance in order to deflect performance issues, and therefore found he had acted in bad faith.

The EAT allowed the appeal. Because the allegation was made honestly, the employee had not made it in bad faith. It confirmed that employees can claim victimisation even where the allegation of discrimination is made for an ulterior motive – provided they acted honestly. The EAT also said that if the employee has an ulterior motive, this could impact on the amount of compensation awarded.

Practical point

The key issue is whether the employee acted honestly in giving the information or making the allegation relied on as a protected act.

For employers to succeed in defeating a victimisation claim under discrimination legislation, they must establish that:

  • the evidence, information or allegation of discrimination the employee made was false, and
  • the employee gave that evidence, information or allegation dishonestly
The more obviously false an allegation is, the more likely it is that a tribunal will find it was not made honestly – but the onus will be on the employer to prove this.

Saad v Southampton University Hospital NHS Trust

The key employment changes in the Budget

IR35 reforms - The off-payroll working rules currently applying to the public sector will be extended to large and medium-sized businesses in the private sector from April 2020. IR35 aims to combat tax avoidance by workers supplying their services to clients via personal service companies (PSC). In 2017, the off-payroll working rules were introduced in the public sector. This resulted in the onus of determining whether IR35 applies being transferred from the PSC to the public authority client. Either the client or the agency who pays the PSC for the worker's services must then make payroll deductions of tax and National Insurance Contributions from the fees it pays to the PSC.

Termination payments - The introduction of employer Class 1A NICs on termination payments over £30,000 is delayed until April 2020. This change will increase the cost of large termination payments so employers will welcome the delay in implementing this new rule.

National Minimum Wage and National Living Wage - From April 2019 the national living wage will increase to £8.21 and the 21-24 year old rate to increase to £7.70, subject to Parliamentary approval.

Government consultation on mandatory ethnicity pay reporting

The Government has launched a consultation asking for views on taking forward its manifesto commitment that large employers should publish ethnicity pay data. The consultation closes on 11 January 2019.

The consultation paper does not indicate when ethnicity pay reporting is expected to come into force. The Government is considering implementing a trial or phased approach in which it works with some employers in the public and private sectors to test different approaches before mandatory reporting is introduced.

https://www.gov.uk/government/consultations/ethnicity-pay-reporting

For a detailed update on this consultation, see Government proposals on mandatory ethnicity pay reporting

Proposals to help parents and carers in the workforce

The Government is considering proposals to help parents and carers in the workforce, including creating a duty on employers to consider whether a role may be done flexibly, and making this clear when advertising the role.

In addition, the Government is considering proposals for greater transparency on parental pay. It will consult on whether to require employers with at least 250 staff to publish on their website their parental leave and pay policies, so job applicants can make informed decisions. Currently job applicants have to ask for this information, which many are reluctant to do for fear of discrimination.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions