Almost two years ago, I mentioned the English Court of Appeal’s decision in Uber BV & Ors v Aslam & Ors [2018] EWCA Civ 2748 on appeal from UKEAT/0056/17/DA), where individuals working as taxi drivers for Uber were to be classified as workers not self-employed individuals.
This decision was a significant defeat for Uber, but it was hardly going to be the last word in the story and so it proved. An appeal to the U.K. Supreme Court was always going to be on the cards and, on Friday 19 February, the Justices issued their judgement (see Uber BV & Ors v Aslam & Ors [2021] UKSC 5).
The Supreme Court was asked to consider two questions by Uber:
Whether the drivers (the Respondents) were “workers” providing personal services to the Second Appellant.
If the Respondents were “workers”, what periods constituted their “working time”.
The result? Uber drivers are workers not self-employed individuals. Essentially, the Supreme Court has approved the earlier decision of the English Court of Appeal.
Although Uber drivers won’t acquire full employment status, this decision is, nonetheless, highly significant. It will, for example, mean that Uber drivers will be protected under the National Minimum Wage legislation and the Working Time Regulations.
Paragraphs 94 to 102 of the Supreme Court’s decision are really instructive. The Court found the following matters extremely significant:
The rates of pay for taxi drivers was set solely by Uber
The contractual terms were dictated solely by Uber
Uber constrained or restricted the ability of drivers to decline jobs
Uber strictly vetted the type of vehicle which drivers could use for jobs and the technology used by drivers was “wholly owned” by Uber
The communication between a driver and a passenger was severely restricted by Uber in order “to prevent drivers from establishing any relationship with a passenger capable of extending beyond an individual ride.”
As Lord Leggatt (who delivered the unanimous judgement of the Court) stated at paragraph 102:
“Taking these factors together, it can be seen that the transportation service performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Furthermore, it is designed and organised in such a way as to provide a standardised service to passengers in which drivers are perceived as substantially interchangeable and from which Uber, rather than individual drivers, obtains the benefit of customer loyalty and goodwill. From the drivers’ point of view, the same factors – in particular, the inability to offer a distinctive service or to set their own prices and Uber’s control over all aspects of their interaction with passengers – mean that they have little or no ability to improve their economic position through professional or entrepreneurial skill. In practice the only way in which they can increase their earnings is by working longer hours while constantly meeting Uber’s measures of performance.”
Worker is a term which is widely used in EU equality and employment law, but a single definition does not exist. As a result of the U.K.‘s long relationship with the EU, the term has entered the British legal systems and, in the interim period, Brexit will not change this fact.
In Allonby v Accrington and Rossendale College (Case C-256/01) [2004] ICR 1328; [2004] ECR I-873 the Court of Justice made the following observation:
“… there must be considered as a worker a person who, for a certain period of time, performs services for and under the direction of another person in return for which he receives remuneration …”
In Syndicatul Familia Constanta v Directia Generala de Asistenta Sociala si Protectia Copilului Constanta (Case C-147/17) EU:C:2018:926; [2019] ICR 211, the Court of Justice of the EU was strongly of the opinion that the relationship between employer and worker was of a “hierarchical” nature. This was a view echoed by Lord Clarke in the Supreme Court’s decision of Hashwani v Jivraj [2011] UKSC 40; [2011] 1 WLR 1872 where he identified the relationship as one of “subordination” in favour of the person receiving the services.
That said, Baroness Hale in a later Supreme Court decision – Clyde and Co LLP and Anor v Bates van Winkelhof [2014] UKSC 32 – stated that “while subordination may sometimes be an aid to distinguishing workers from other self-employed people, it is not a freestanding and universal characteristic of being a worker”. This remark was quoted with approval by Lord Leggatt in the Uber decision at paragraph 74 of his judgement.
In other words, such a feature is merely to be deployed as one of the many possible tests that can be used by the courts to analyse a relationship between two parties.
The Employment Rights Act 1996
Section 230(1) of the Employment Rights Act 1996 contains the definition of who precisely is an employee i.e. someone who has a contract of service. If you don’t have this type of contractual arrangement (you’re not an employee), you may well be working under a contract for services. This is one of the most important distinctions in employment law in the United Kingdom.
Section 230(3) of the Act also defines in law an individual who is a ‘worker’. This can include someone who provides services under an employment contract – and, crucially, some individuals who fall into the self-employed category.
Conclusion
Individuals working under a contract for services – precisely because of their lack of employment status – are often denied access to the sorts of legal rights which employees routinely take for granted e.g. unfair dismissal protection, redundancy protection, family friendly rights.
There are notable exceptions (aren’t there always?): high earning British television celebrities (e.g. Lorraine Kelly) or a number of BBC news journalists have preferred to be treated as freelancers or self-employed persons. Why? They can then minimise their exposure to income tax liability in a way (often via the medium of personal service companies) that would not be possible because if they were employees they would almost certainly be taxed at source on a PAYE (pay as you earn) basis.
We have seen an explosion in the type of work that is often characterised or labelled as the ‘gig economy’. This work is often characterised by a distinct lack of employment rights; irregular working patterns; chronic insecurity; lack of long term career progression; and low pay. It is often impossible for such individuals to complete the necessary periods continuous service to acquire employment rights.
Companies such as Deliveroo, Lyft and Uber have become synonymous with the ‘gig economy’, as have whole sectors of the employment
There’s now a growing awareness on both the part of the UK Government (The Taylor Review) and the European Union (the forthcoming EU Directive on Transparent and predictable working conditions) that people on contracts for services deserve greater levels of work-place protection.
It’s not just in the UK that debates about employment status are currently playing out. At the tail end of 2019, it was with particular interest that, in 2019/20, I was following a story from the United States which highlighted many of the issues which I have just been discussing in this Blog.
The US State of California enacted a law, Assembly Bill 5 2019 or AB5 (known more popularly as the gig economy law) giving those individuals working in the gig economy more employment rights. The law came into force on 1 January 2020.
The Covid-19 pandemic has also exposed the lack of employment protection for workers and the self-employed. Only last March, I was writing about the fact that the U.K. Government’s reforms to Statutory Sick Pay would would not include approximately 2 million individuals – a situation that Frances O’Grady, General Secretary of the TUC was quick to highlight.
By Helan Ali, Rebecca Brodie, Cameron Crossan, Jack Holland and Eve Richmond (Editor: SJ Crossan)
Introduction
Dismissal occurs where an employers terminates the contract of employment between themselves and the employee. There are several types of dismissal that can arise such as: fair, unfair, wrongful, summary and constructive.
Perhaps the most common mistake amongst members of the public concerning dismissal is the tendency to confuse wrongful and unfair dismissal: they are entirely separate (Crossan, 2017). An unfair dismissal is one which breaches or contravenes statute; whereas wrongful dismissal occurs when the contract of employment is breached.
In all dismissal claims, it is important to determine if the claimant is actually an employee. This status is outlined in S230 of the Employment Rights Act 1996 in that the individual in question must be employed under a contract of service.
Employment law – always a tricky area to navigate as a result of its sheer volume becomes particularly difficult when it comes to the area of dismissal – as there can be a delicacy when it comes to terminating the employee’s contract. If you look at recent media stories, there are several high profile dismissal cases such as former senior civil servant, Sir Philip Rutnam pursuing an unfair dismissal claim against UK Home Secretary, Priti Patel or the UK retailer, Asda (part of the Walmart group) forcing their employees to accept new contracts or to face dismissal.
Unfair dismissal
Fair dismissal occurs when there is a termination of the employment contract, but the employer has the right to act in this manner as per S98(2) of the Employment Rights Act 1996.
The employer may have fair grounds to dismiss an employee under grounds of capability where the employer genuinely does not believe the employee is able to carry out their role any longer. Such a dismissal can be seen in Taylor v Alidair [1978] IRLR 82 where a pilot was dismissed from his contract after he landed a plane negligently and there was serious danger to life and limb. The pilot’s subsequent dismissal was completely fair in the circumstances.
An employer may also have the grounds to dismiss an employee on the grounds of conduct. Generally, one act of gross misconduct could potentially result in an employee’s dismissal. However, employers must have clear guidelines and these must be adhered to, but it does not necessarily mean that in every situation the same same outcome i.e. that of dismissal be the end result. Employers are entitled to have recourse to what is known as a reasonable band of responses, which might include the following:
Verbal or written warnings
Demotion
Dismissal
Deduction in pay (if the contract so permits)
If the employer has acted reasonably when carrying out the dismissal of the employee, there can be no overturning of that decision by an Employment Tribunal. This is regardless of whether the Tribunal would have taken a more lenient approach i.e. a preference for a final written warning over dismissal (see Iceland Frozen Foods v Jones [1983] ICR 17).
Employees are not exempt from their employer’s code of conduct even when they leave the premises as their actions taken outside of work can still result in a dismissal. This can be seen in McLean v McLane Ltd EAT 682/96 where an employee was drunk and disorderly outside working hours. He was also found to in possession of cannabis (a Class C drug in the UK). This information was released to the media which reported the story and, as a result, the employee was dismissed. This action by the employer was deemed fair by the Employment Tribunal.
Not all employees are fairly dismissed and the actions of the employer might mean that have been unfairly dismissed. To qualify for employment rights regarding unfair dismissal, an employee must normally have a minimum of 2 years’ continuous service (as per the Employment Rights Act 1996), but there are numerous exceptions e.g. discrimination, health and safety and whistle-blowing dismissals.
Employers can, admittedly, find a way around the 2 year continuous service period by employing someone on short-term contracts, thus ensuring that the minimum qualifying period is never met and the employee has not acquired any rights in respect of dismissal.
In some employment roles it is not possible to be unfairly dismissed due to the nature of the role e.g. UK armed forces and/or police service staff. Employees have the right be accompanied to a dismissal meeting if they choose to do so, they can bring a fellow employee or trade union official. Further details on this can be found under S10 of the Employment Relations Act 1999. Employers should adhere to their company guidelines and follow procedural fairness when disciplining employees – especially if dismissal is an option they are considering (as demonstrated in British Homes Stores Ltdv Burchell [1978] IRLR 379).
Wrongful dismissal
Moving on to the issue of wrongful dismissal, where the contract is breached due to the dismissal procedure. The most common example is the employee does not receive the requisite notice period from the employer. In this instance the employee would not require two year’s continuous service to raise a claim in this regard. The statutory minimum notice period, according to S86 of the Employment Rights Act 1996, is one week for each year of service up to a maximum of 12 weeks.
Claims for wrongful dismissal must be made within three months’ minus one day of the effective date of the termination of the contract to the Office of Employment Tribunals (OET). The case of Morran v City Council of Tenants (1998) is highly instructive.
Morran claimed wrongful and unfair dismissal when his employer dismissed him without being given the compulsory notice period; he just missed out on accumulating enough continuous service. Held by the Scottish Court of Session, Morran was entitled to claim wrongful dismissal and receive compensation however he could not claim unfair dismissal as he had never acquired the actual right to bring such a claim. Employees who claim wrongful dismissal tend to be reimbursed by compensation. It would be very rare for an employee to go back to their job after claiming wrongful dismissal.
In fact, S236 of the Trade Union and Labour Relations Act (Consolidation) 1992 states that no court or Tribunal can issue an order for specific implement or anything which will force the parties to work together under an employment contract.
Summary dismissal
Another type of dismissal is summary: “This is when you dismiss someone instantly without notice or pay in lieu of notice, usually because of gross misconduct (for example theft, fraud, violence).” (UK Government, 2020). Summary dismissal if not handled properly can be wrongful or unfair. An employer will need to prove the employee has committed violent or serious acts or health and safety breaches.
Even if an employer feels summary dismissal is the preferred option, it is worth stepping back and taking stock. It is often better and far safer to suspend an employee on full pay and then investigate the situation to head off a potential claim for unfair and/or wrongful dismissal.
Summary dismissal will be justified if the employer can prove the act committed by the employee amounts to gross misconduct in the workplace. However, if the employee can argue that their actions were not that of gross misconduct and no notice period was given employer will be liable for wrongful dismissal. The remedies available to the employee would be compensation.
Constructive dismissal
One last dismissal claim is that of constructive dismissal. This arises when an employer commits a serious breach of the employment contract and the employee has no alternative but to resign. In these types of claims, employees can treat themselves as dismissed as the employer’s behaviour has effectively destroyed the employment contract.
The individual claiming constructive dismissal is saying S/he has been unfairly dismissed and for this claim to be granted they must prove the employer’s conduct was so severe that it amounted to a fundamental or material breach. Constructive dismissal occurs in “situations where the employer made unauthorised deductions from wages; subjected to bullying and harassment; where the employer refused to follow the proper disciplinary or grievance procedures.” (Crossan, 2020)
In Sharp v Western Excavating Ltd [1978] ICR 221, Lord Denning explained the rules regarding constructive dismissal:
“An employee is entitled to treat himself as constructively dismissed if the employer is guilty of conduct which is a significant breach going to the root of the contract of employment… then the employee is entitled to treat himself as discharged from any further performance.”
As a point of interest, Sharpe was not entitled to claim constructive dismissal: his employer was perfectly within its rights to refuse him time off from work to go and play cards. The employer’s behaviour was entirely reasonable and thus did not represent a material breach of the employment contract.
Procedural fairness
When contemplating dismissal as an option for disciplinary offences, it is often safer for employers to suspend the relevant employees on full pay and carry out a full investigation, rather than dismiss employee instantly. Employers should ensure that disciplinary procedures are clear and consistent and comply with current ACAS Codes on discipline at work (see link below).
Claims for both unfair and wrongful dismissal must be made within three months’ minus one day of the effective date of the termination of the contract to the Office of Employment Tribunals (OET). Failure by the claimant to submit an application within the time limit will mean that the claim is time barred i.e. it cannot normally be heard by the Tribunal – no matter its merits.
Remedies for dismissal
A claimant who brings a successful action for dismissal may be entitled to the following remedies issued by a court or a Tribunal:
Compensation
Reinstatement
Re-engagement
If the employee can claim dismissal, they could be entitled to compensation and/or reinstatement (failing that, re-engagement if reinstatement to their old position is no longer available). An employer does not have to reinstate or re-engage the employee and may find it more acceptable to pay a higher sum of compensation.
Sir Philip Rutnam
A current unfair dismissal case is that of Sir Philip Rutnam, former Permanent Secretary at the UK Home Office. Sir Philip is claiming unfair dismissal against his former boss, the current UK Home Secretary Priti Patel MP.
Sir Philip resigned because he is alleging that he was subjected to bullying by Mrs Patel (she denies these claims). At the time of his resignation, Sir Philip, was the Home Office’s most senior official, and he claimed that there had been a “vicious and orchestrated” operation against him. Sir Philip presented a claim to the Employment Tribunal for unfair (constructive) dismissal against the Home Secretary. A Cabinet Office investigation was initiated in March 2020 concerning the allegations against Mrs Patel in order to establish if she had breached the ministerial code. (Patel faces unfair dismissal claim from ex-adviser, 2020). The case is ongoing, but if Sir Philip is successful in his action, it will be hugely embarrassing to the UK Government.
Jo Millington
In another, recent case relating to constructive dismissal, a leading forensic scientist called Jo Millington was a victim of sexual orientation discrimination in the workplace. The scientist was asked by her boss whether she disliked him because of her sexuality. Millington, who is gay, took her case to an Employment Tribunal. She launched claims for sexual orientation discrimination, breach of contract and constructive dismissal against her former employer, ArroGen Forensics after the company’s CEO Joe Arend speculated whether her sexuality was the reason behind her evident dislike of him.
Arend had inquired whether Millington had a problem with him “because of her sexuality”, pointing out he was “big” and “used to play rugby”. The Reading Employment Tribunal was told Millington that she had previously complained about Arend’s behaviour when he referred to the level of her expenses and salary as “crazy”. The Tribunal found the company liable for discrimination on grounds of sexual orientation, constructive dismissal and breach of contract. It concluded that Jo Millington regarded her sexual orientation as a confidential matter; Millington was granted compensation. (Lowe, 2020).
No smoking!
In another unfair dismissal story, a long serving worker at a water bottling plant was sacked for smoking on the premises. The employee took a claim to Tribunal for wrongful and unfair dismissal, which resulted in a successful claim. The claimant, Mr Andrew was a team manager for production at Montgomery Waters Limited, where the no smoking rule was introduced in 2004. Employees were, however, permitted to smoke in a designated ‘smoking hut’.
Bosses were informed that Andrew was seen smoking outside the ‘smoking hut’. CCTV was viewed and appeared to show Andrew smoking, on four occasions, in prohibited areas. The footage showed a man wearing red overalls and Andrew was one of two people to wear these. Andrew, who had 15 years’ service with the company, was suspended during the disciplinary investigation. Andrew denied the allegations, but was still dismissed from his employment. During the Tribunal Hearing, the judge highlighted the vagueness in the firm’s handbook on whether smoking in prohibited areas would amount to misconduct. The judge also observed that it was the employer’s responsibility to enforce strict rules restricting smoking in particular areas. Although Andrew’s claims for both wrongful and unfair dismissal were upheld, the compensation awarded to him was reduced by 50% on the basis that he had contributed to his dismissal (Powys County Times, 2020).
New T&Cs
A controversial case regarding the potential threat of dismissal is Asda’s introduction of a new contractual agreement known as ‘Contract 6’, which will replace the existing agreement. It was introduced back in 2017 and, at this time, signing the new contract was voluntary.
‘Contract 6’ abolished paid breaks, introduced compulsory bank holiday working, staff could also be asked to work flexible hours and work in different departments within the store. In August 2019, Asda were accused of forcing employees to agree to accept ‘Contract 6’.
Asda stated that their employees are required to sign the new contract by November 2019 and, if they failed to do so, their contract of employment would be terminated. Employees would not be entitled to sick pay until the contract was signed. The GMB Trade Union attacked the new agreement and claimed that, under the new conditions, employees would be worse off. The main objection raised by the employees and their trade union was the inflexibility of the contract.
Under these new terms, day shift employees had to be more flexible with their working hours – they had to be available for work between 5am and midnight. It also meant employers could give less notice than before with regard to changing shifts. Employees took the view that Asda was disregarding employment law by unilaterally changing key terms and conditions.
In response to the claims being made, Asda may be able to justify their dismissals as fair in terms of Section 98(2) of the Employment Rights Act 1996 on the grounds that the employer can show that some other substantial reason is the justification behind terminating contracts.
In Asda’s case, the company may be able to justify their actions on the grounds that the new contractual arrangements have been necessitated as a result of a company restructuring exercise. This could make the dismissals potentially fair (Crossan, 2017).
Currently, lawyers for Asda and the GMB Trade Union are at loggerheads. One claim for unfair dismissal has so far been submitted by a former Asda employee, Duncan Carson. He was dismissed due to not signing the new ‘Contract 6’. Carson had worked at Asda for 13 years in total, and a large part of his legal argument is that “a contract is an agreement between two parties”. Carson believes, if one person can change the contract unilaterally.
Furloughing employees
The Coronavirus Job Retention Scheme (CJRS), announced by HMRC on 20 March 2020, is a UK Government funded scheme to provide financial support for employers to allow them to continue to pay part of their employees’ wage costs rather than lay them off during this crisis.
Eligible workers are put into the scheme by employers when agreement is made between both, and these employees are now furloughed workers (Association of Taxation Technicians, 2020)
Nunn (2020) explains that the scheme allows companies to ‘furlough’ their employees, covering 80% of the wage cost, allowing the claim to include 80% of their employee’s gross salary with cap of £2,500 a month.
CIPD (2020) defines furlough as a ‘temporary leave of absence from work’ due to economic conditions of affecting the company or country.
Although this is a new concept for the UK labour-force, the scheme does nothing to change how the fundamentals of UK employment law e.g. it does not mean a break in continuity of employment. The employee must give written agreement to the employer before being enrolled in the scheme.
The CJRS ensures the job security of the British workforce due to employers being unable to provide pay.
The official government site (UK Government, 2020) announced that the scheme is only temporary; set to last a maximum of 4 months, with a 3 consecutive week minimum period for each employee to be furloughed.
The government site explains that employees on sick leave are not eligible for furlough whilst the business is reclaiming Statutory Sick Pay. HMRC allows employers with less that 250 employees to reclaim 2 weeks of Statutory Sick Pay for each employee off work for a coronavirus related cause, although the method to do so has still to be put in place by the HMRC. Employees with multiple jobs can also be furloughed from either or both jobs, as the £2,500 wages’ cap applies to each job.
In order to be eligible for the government scheme, the employer must have PAYE account, and each employee must have been included on RTI submission in the pay period on or before 19 March 2020 (CIPP, 2020).
The UK Government (2020) also announced that any employees made redundant before 28 February, due to the impact of Coronavirus, could be eligible for furlough status – as long as they were on the PAYE scheme before they were dismissed. Employers could claim for them also and this part of the furlough scheme has prevented those in industries, such as hospitality, from being almost certainly made redundant.
It is, of course, up to the employer if they choose to furlough any dismissed employees who are eligible to partake in the CJRS and there is no legal requirement for the employer to go down this path.
Therefore, utilising the CJRS gives employers the cash-flow for the wage costs to be able to keep employees on their payroll for when the business reopens, as an alternative to dismissing them during this global crisis. At this present time,it ensures job security for the employee but it may also mean living with a reduced wage.
Conclusion
To summarise, dismissal is a vast and complex area of employment law yet once broken down becomes that bit clearer to understand. The area is ever changing with cases now coming against the Government itself and what pathway that may open if Rutnam is successful in his claim against Patel. There are also the uncertainties in the world just now surrounding coronavirus and the impact it was have on employee’s not only with their wages but with their employment status when this all ends.
One of the most important common law duties that an employer has under the contract of employment is to pay wages to the employee.
This duty, of course, is contingent upon the employee carrying out his or her side of the bargain i.e. performing their contractual duties.
The right to be paid fully and on time is a basic right of any employee. Failure by employers to pay wages (wholly or partially) or to delay payment is a serious contractual breach.
Historically, employers could exploit employees by paying them in vouchers or other commodities. Often, these vouchers could be exchanged only in the factory shop. This led Parliament to pass the Truck Acts to prevent such abuses.
Sections 13-27 of the Employment Rights Act 1996 (which replaced the Wages Act 1986) give employees some very important rights as regards the payment of wages.
The National Minimum Wage Act 1998 (and the associated statutory instruments) and the Equality Act 2010also contain important provisions about wages and other contractual benefits.
There are a number of key issues regarding the payment of wages:
All employees are entitled to an individual written pay statement (whether a hard or electronic copy)
The written pay statement must contain certain information
Pay slips/statements must be given on or before the pay date
Fixed pay deductions must be shown with detailed amounts and reasons for the deductions e.g. Tax, pensions and national insurance
Part time workers must get same rate as full time workers (on a pro rata basis)
Most workers entitled to be paid the National Minimum Wage or the National Minimum Living Wage (if over age 25) (NMW)
Some workers under age 19 may be entitled to the apprentice rate
Most workers (please note not just employees) are entitled to receive the NMW i.e. over school leaving age. NMW rates are reviewed each year by the Low Pay Commission and changes are usually announced from 1 April each year.
It is a criminal offence not to pay workers the NMW and they can also take (civil) legal action before an Employment Tribunal (or Industrial Tribunal in Northern Ireland) in order to assert this important statutory right.
There are certain individuals who are not entitled to receive the NMW:
Members of the Armed Forces
Genuinely self-employed persons
Prisoners
Volunteers
Students doing work placements as part of their studies
Workers on certain training schemes
Members of religious communities
Share fishermen
Pay deductions?
Can be lawful when made by employers …
… but in certain, limited circumstances only.
When exactly are deductions from pay lawful?:
Required or authorised by legislation (e.g. income tax or national insurance deductions);
It is authorised by the worker’s contract – provided the worker has been given a written copy of the relevant terms or a written explanation of them before it is made;
The consent of the worker has been obtained in writing before deduction is made.
Extra protection exists for individuals working in the retail sector making it illegal for employers to deduct more than 10% from the gross amount of any payment of wages (except the final payment on termination of employment).
Employees can take a claim to an Employment Tribunal for unpaid wages or unauthorised deductions from wages. They must do so within 3 months (minus 1 day) from the date that wages should have been paid or, if the deduction is an ongoing one, the time limit runs from the date of the last relevant deduction.
An example of a claim for unpaid wages can be seen below:
Regular readers of the Blog will be aware of the provisions of the Equality Act 2010 in relation to pay and contractual benefits. It will amount to unlawful sex discrimination if an employer pays a female worker less than her male comparator if they are doing:
Like work
Work of equal value
Work rated equivalent
Sick Pay
Some employees may be entitled to receive pay from the employer while absent from work due to ill health e.g. 6 months’ full pay & then 6 months’ half pay. An example of this can be seen below:
Statutory Sick Pay (SSP)
This is relevant in situations where employees are not entitled to receive contractual sick pay. Pre (and probably post Coronavirus crisis) it was payable from the 4th day of sickness absence only. Since the outbreak of the virus, statutory sick pay can paid from the first day of absence for those who either are infected with the virus or are self-isolating.
Contractual sick pay is often much more generous than SSP
2020: £95.85 per week from 6 April (compared to £94.25 SSP in 2019) which is payable for up to 28 weeks.
To be eligible for SSP, the claimant must be an employee earning at least £120 (before tax) per week.
Employees wishing to claim SSP submit a claim in writing (if requested) to their employer who may set a deadline for claims. If the employee doesn’t qualify for SSP, s/he may be eligible for Employment and Support Allowance.
Holiday Pay
As per the Working Time Regulations 1998 (as amended), workers entitled to 5.6 weeks paid holiday entitlement (usually translates into 28 days) per year (Bank and public holidays can be included in this figure).
Some workers do far better in terms of holiday entitlement e.g. teachers and lecturers.
Part-time workers get holiday leave on a pro rata basis: a worker works 3 days a week will have their entitlement calculated by multiplying 3 by 5.6 which comes to 16.8 days of annual paid leave.
Employers usually nominate a date in the year when accrual of holiday pay/entitlement begins e.g. 1 September to 31st August each year. If employees leave during the holiday year, their accrued holiday pay will be part of any final payment they receive.
Holiday entitlement means that workers have the right to:
get paid for leave that they build up (‘accrue’) in respect of holiday entitlement during maternity, paternity and adoption leave
build up holiday entitlement while off work sick
choose to take holiday(s) instead of sick leave.
Guarantee payments
Lay-offs & short-time working
Employers can ask you to stay at home or take unpaid leave (lay-offs/short time working) if there’s not enough work for you as an alternative to making redundancies. There should be a clause in the contract of employment addressing such a contingency.
Employees are entitled to guarantee pay during lay-off or short-time working. The maximum which can be paid is £30 a day for 5 days in any 3-month period – so a maximum of £150 can be paid to the employee in question.
If the employee usually earn less than £30 a day, s/he will get their normal daily rate. Part-time employees will be paid on a pro rata basis.
How long can employees be laid-off/placed on short-time working?
There’s no limit for how long employees can be laid-off or put on short-time. They could apply for redundancy and claim redundancy pay if the lay-off/short-term working period has been:
4 weeks in a row
6 weeks in a 13-week period
Eligibility for statutory lay-off
pay
To be eligible, employees must:
have been employed continuously for 1 month (includes part-time workers)
reasonably make sure you’re available for work
not refuse any reasonable alternative work (including work not in the contract)
Not have been laid-off because of industrial action
Employer may have their own guarantee pay scheme
It can’t be less than the statutory arrangements.
If you get employer’s payments, you don’t get statutory pay in addition to this
Failure to receive guarantee payments can give rise to Employment Tribunal claims.
This is an extremely relevant issue with Coronavirus, but many employers are choosing to take advantage of the UK Government’s Furlough Scheme whereby the State meets 80% of the cost of an employee’s wages because the business is prevented from trading.
Redundancy payments
If an employee is being made redundant, s/he may be entitled to receive a statutory redundancy payment. To be eligible for such a payment, employees must have been employed continuously for more than 2 years.
The current weekly pay used to calculate redundancy payments is £525.
Employees will receive:
half a week’s pay for each full year that they were employed under 22 years old
one week’s pay for each full year they were employed between 22 and 40 years old
one and half week’s pay for each full year they were employed from age 41 or older
Redundancy payments are capped at £525 a week (£508 if you were made redundant before 6 April 2019).
Please find below a link which helps employees facing redundancy to calculate their redundancy payment:
What happens if the employer becomes insolvent and goes into liquidation?
Ultimately, the State will pay employees their wages, redundancy pay, holiday pay and unpaid commission that they would have been owed. This why the UK Government maintains a social security fund supported by national insurance contributions.
An example of a UK business forced into liquidation can be seen below:
Up to 900 workers lost their jobs when administrators closed 70 of the cafe chain’s outlets. Disclaimer:
Conclusion
Payment of wages is one of the most important duties that an employer must fulfil. It is also an area which is highly regulated by law, for example:
The common law
The Employment Rights Act 1996
The Working Time Regulations 1998
The National Minimum Wage Act 1998
The Equality Act 2010
Family friendly legislation e.g. adoption, bereavement, maternity, paternity
Failure by an employer to pay an employee (and workers) their wages and other entitlements can lead to the possibility of claims being submitted to an Employment Tribunal. The basic advice to employers is make sure you stay on top of this important area of employment law because it changes on a regular basis and ignorance of the law is no excuse.
Balaclavas can be very useful things to have to hand – when the weather is very cold or you’re discussing the Crimean War (1853-1856) from where the term for the garment originates in the United Kingdom (circa 1881, according to the historian and cleric, Richard Rutt). During the Crimean War, British soldiers wore the garment to cope with the sub-zero temperatures that they experienced during the winter months of the Campaign.
Today, the garments are still incredibly popular with cyclists and winter sports’ enthusiasts (I confess: I have two for cycling during the winter months and they’re great!).
Despite, the historical associations with the British Army’s involvement in the Crimean War, it’s not always advisable to use the Balaclava as a teaching aid for History classes – especially DIY History classes.
McClean, an Irish footballer playing for the English Championship side, Stoke City FC, has recently found this out to his cost.
In a bizarre social media post (on Instagram), McClean put a picture of himself wearing a Balaclava as he was talking to two children. What was the point of this strange exercise? McClean claims that he was teaching the children about history, but others have seen this as an endorsement of paramilitary groups – particularly the Provisional IRA.
Today’s history lesson by James McClean
There was a public backlash and McClean was fined by this Club. The player is something of a controversial figure to many as he routinely refuses to have a poppy printed on his football jersey in the run-up to Remembrance Day commemorations each November in the United Kingdom.
McClean hails from the City of Derry in the North of Ireland which will be forever associated with the events of ‘Bloody Sunday’ on 30 January 1972. On that day, 13 innocent Civil Rights marchers were shot and killed without justification by members of the Parachute Regiment – as per the conclusions of Lord Saville’s Report (2010) which contradicted Lord Widgery’s findings published in April 1972. The Saville Inquiry took 12.5 years and cost the British taxpayer £191.5 million – the longest and most expensive inquiry ever in the United Kingdom (figures obtained from The Spectator).
The previous Widgery Report was seen by many in the Republican and Nationalist community as a cover-up and a whitewash in that it absolved the Parachute Regiment of any wrong-doing for the deaths. Inevitably, the Report fuelled a long lasting sense of grievance within this community. McClean grew up on Derry’s Creggan Estate – not far from St Mary’s Church where many of the funerals of the ‘Bloody Sunday’ victims took place.
We often forget that footballers can be employees i.e. have a contract of service with their Clubs as per Section 230 of the Employment Rights Act 1996. McClean is fortunate that he has retained his post; other, less famous employees might not have been so lucky.
Section 98(4) of the Employment Rights Act 1996 permits an employer to dismiss an employee (potentially) fairly by reason of his/her conduct (with the proviso, of course, that the employer follows proper procedures in line with current ACAS standards).
McClean might initially have protested that the social media post was done while he was outside working hours. Regular readers of this Blog will be well aware that this type of excuse is extremely naive at best. Yes, employees do have a right to privacy, in terms of the European Convention on Human Rights, but this is never absolute – especially if an employer can argue that the behaviour of an individual employed by him or her has caused reputational damage to the organisation.
Employers do have a part to play here: they have a duty to have clear and consistent guidelines on employee social media use within and outwith the work-place. It should go without saying (but I’ll say it anyway) that the employer should make sure that employees are aware of the existence of such guidelines and have actually read them.
The misbehaviour or misconduct of employees which takes place outside working hours can have a really serious reputational impact on your employer. Individuals, like McClean, with high profiles in the community should be aware of this. It won’t be the last time that we read about someone who is deemed to be a role model – a teacher or a sporting personality – who misbehaves outside work and pays the price for this type of behaviour.
A link to the story on the Sky News website can be found below:
Today seems to be something of a red letter day for the Blog with regard to the issue of protected philosophical beliefs in terms of the Equality Act 2010.
We have already heard the news that Jordi Casamitjana has won the part of his Employment Tribunal claim that his ethical veganism is a philosophical belief in terms of Sections 4 and 10 of the 2010 Act (see Casamitjana v League Against Cruel Sports [2020]).
It was some interest that another news item popped up today concerning allegations that Amazon stands accused of threatening to dismiss those of its employees who become involved in climate protests. I would hazard a guess that Amazon is making a statement of intent that it may dismiss employees who perhaps break the law when they are involved in climate protests such as those organised by Extinction Rebellion and other similarly minded groups.
Criminal acts by employees committed outside the workplace could be regarded as gross misconduct in terms of Section 98 of the Employment Rights Act 1996. In other words, such behaviour by employees could result in the employer suffering reputational damage and, consequently, any dismissal for misconduct could be potentially fair. That said, employers should always carry out the proper disciplinary procedures when contemplating dismissal as the ultimate sanction for employee misbehaviour.
The real gripe – according to Amazon Employees for Climate Justice – is that the tech company allegedly objects to employees speaking critically about its failure to be more environmentally responsible.
Yet, there are potential dangers here for Amazon in the UK. In Grainger plc v Nicholson (2010) IRLR 4, the Employment Appeal Tribunal established that an employee’s belief in climate change could constitute discrimination on the grounds of a philosophical belief.
So, we could have situation where Amazon employees who are taking part in quite peaceful and lawful climate change protests end up being dismissed. This would open up the possibility that employees of Amazon UK might have the right to bring claims for direct discrimination (Section 13: Equality Act 2010) in respect of their philosophical beliefs (Sections 4 and 10 of the Act).
In the USA, there could be even more serious legal implications – infringing the right to free speech which is protected under the Constitution.
Perhaps Amazon needs to go back to the drawing board …
A link to an article on the BBC News App can be found below:
Several of my previous blogs (It happened outside work … (or it’s my private life!) published on 7 February 2019; Social Media Misuse published on 11 April 2019; and Social media and dismissal published on 20 May 2019) have addressed the issue of whether employees have a right to privacy in the work-place.
The short answer is yes and no: privacy is not an absolute right.
Privacy in the work-place is becoming more of an issue thanks to the widespread use of social media by employees outwith working hours (and, of course, during the working day).
If you’re working in the public sector (and this, potentially, covers a large number of employees), Article 8 of the European Convention on Human Rights i.e. the right to family and private life could be particularly relevant to your situation.
Even if you’re employed by a private sector organisation, Article 8 rights are still relevant because they are ultimately guaranteed by the State (the United Kingdom) as a signatory to the European Convention. Furthermore, there are all sorts of situations where private sector organisations may be regarded as ’emanations/entities of the State’ because they carry out some type of work or provide a service which is beneficial to the wider public (think utilities companies or those organisations which benefit from outsourced contracts from local and central government).
Regular readers of this blog will know, of course, that provisions of the European Convention have been incorporated into Scots Law via the Scotland Act 1998 and the Human Rights Act 1998.
Employers, quite rightly, may have legitimate concerns about the type of content or statements that their employees post on social media platforms – especially if such material could cause the organisation to suffer some sort of reputational damage.
In such circumstances, it’s simply not a competent defence for employees to argue that disciplinary action (up to and including dismissal) which might be taken by their employers represents unwarranted interference in their private lives.
That said, it is very important for employers to set out clear guidelines and policies covering social media (mis)use by employees during and outwith working hours. There is a balancing exercise to be had here between the legitimate interests of the employer and the employee.
So, it was with some interest that I read about a case before the Outer House of the Court of Session during the summer which dealt with the boundaries of employee privacy (see Petition of B, C and Others v Chief Constable Police Service of Scotland and Others [2019] CSOH 48).
Lord Bannatyne rejected the Petition for judicial review lodged by a number of serving Police Scotland officers who were accused of (non-criminal) misconduct by their employer. These officers had allegedly used the WhatsApp social media platform to exchange a number of messages between them which were deemed to be offensive in nature and not in keeping with their role as serving members of Police Scotland.
Police Scotland wished to access the content of these messages in order to progress the misconduct hearings, but the officers involved in the disciplinary investigation argued that this constituted a breach of their human rights – specifically their rights to privacy Article 8 of the European Convention on Human Rights. More generally, the officers were also arguing that they had the right to privacy at common law.
His Lordship highlighted the significance of the important decision of the European Court of Human Rights: Von Hannover v Germany [2005] 40 EHRR 1 to the case before him.
Von Hannover raises three important considerations:
“… the width of the concept of private life; the purpose of Article 8, i.e. what it seeks to protect; and the need to examine the particular circumstances of the case in order to decide whether, consonant with that purpose, the applicant had a legitimate expectation of protection in relation to the subject matter of his complaint.”
The key issue which Lord Bannatyne identifies from Von Hannover, is whether the Scottish police officers “had a legitimate expectation of protection” in terms of Article 8; or to draw upon a phrase later formulated by UK Supreme Court Justice, Lord Toulson: “a legitimate expectation of privacy” (see In re JR38 2016 AC 1131).
In rejecting the officers’ petition, Lord Bannatyne focused on the existence of the Standards of Professional Behaviour contained in Schedule 1 to the 2014 Regulations to which all serving Police officers must adhere (in particular the officers had sworn an oath to uphold these Standards both while on and off duty).
His Lordship stated:
“There is a restriction on police officers’ private life and therefore their expectation of privacy. … It is only in relation to these matters that there is a limitation on the officer’s privacy it is not a whole scale intrusion into his private life. Accordingly to achieve the underlying purpose of the Standards, namely: the maintenance of public confidence in the police, police officers have a limitation on their expectation of privacy as above described.“
A link to Lord Banntyne’s judgement can be found below:
As a point of interest, several days after Lord Bannatyne’s judgement was reported, the BBC carried a story about United States Border Patrol officers who were suspended from employment for posting offensive remarks about migrants (and other individuals) on Facebook.
Clearly dissatisfied with the judgement of Lord Bannatyne in the Outer House, the Petitioners appealed to the Inner House of the Court of Session by way of a reclaiming motion.
On 16 September 2020, the Inner House issued its judgement in this regard (see Petition of B, C and Others v Chief Constable Police Service of Scotland and Others [2020] CSIH 61). The Petitioners’ arguments (the reclaiming motion) were comprehensively and unanimously rejected by Lady Dorrian, the Lord Justice Clerk, Lords Menzies and Malcolm.
Some of Lord Malcolm’s remarks were especially striking and illuminating:
“Essentially, the touchstone of private life is whether in respect of the disclosed facts the person in question had a reasonable expectation of privacy.” (Lord Nicholls in Campbell v MGN Ltd [2004] 2 AC 457 at paragraph 21) …
… All of those involved were police officers. Each had solemnly sworn to uphold certain professional responsibilities and standards in both their public and private lives, and had promised, in effect, to take action if informed of the misconduct of others. This was known to each participating officer. To take perhaps an extreme example, if a constable (or indeed any public official) writes to a colleague stating that he accepts bribes, he might hope that it will be treated in confidence; he might even have such an expectation, but if so, it is neither reasonable nor legitimate.”
Lord Malcolm also pithily disposed of an argument put forward by Counsel for the Petitioners:
“Mr Sandison submitted that police officers should enjoy the opportunity to have “off the record” communications between each other in whatever terms they consider to be appropriate. As he put it, the petitioners should be “free to be persons”, presumably as opposed to being members of the police force. The difficulty is that they are both.”
A link to the judgement of the Inner House can be found below:
A story which caught my eye over the last few days comes from the fair Canadian City of Toronto and involves misconduct dismissals. For a change, the dismissals do not involve social media misuse, but rather good old fashioned fraud.
150 members of staff working at a Toronto hospital were sacked for involvement in a sophisticated prescription fraud which was reportedly in the region of £3 million over an 8 year period. Defrauding your employer is, of course, an extremely serious breach of trust which materially undermines the contract of employment.
Interestingly, at this point, the Police in Toronto have not charged any individual with the crime of fraud – yet – but clearly the employer feels that it has sufficient grounds to go ahead with the dismissals.
I often to say to students that the employer merely has to have a reasonable suspicion that the employee has committed an act of misconduct. There is no need for the employer to demonstrate that the allegation(s) of misconduct meets the criminal standard of proof.
A link to the story on the Sky News website can be found below:
Had this story occurred in the UK, we would be talking about the matter in the context of Section 98(4) of the Employment Rights Act 1996. If employers can show that the reason for the dismissal of employees is justified i.e. on the grounds of misconduct (fraud), it will be a fair dismissal. As a point of good disciplinary policy, of course, employers should always follow the proper procedures when deciding to dismiss employees on the grounds of dismissal.
An interesting article appeared in today’s Independent about a campaign to encourage Waterstone’s, the well known high street book retailer, to pay staff the Living Wage.
As I often say to my students, when discussing the issue of pay, it is a hugely emotive issue – especially if you happen to be at the lower end of the wage scale and have difficulty getting your proper entitlement.
The idea of the employee or labourer being worthy of his or her hire is a deeply ingrained cultural norm in European and North American societies (largely underpinned by many scriptural references in both the Old and New Testaments of the Christian Bible e.g. Deuteronomy 24: 15 and Matthew 20: 8).
The employer, of course, has a contractual duty to pay her employees in return for them providing services.
“Paying the living wage also makes sense from a business perspective. The Living Wage Foundation said that 93 per cent who paid the wages had seen benefits in retention and motivation of staff, and company reputation.”
As the Living Wage Foundation emphasises the real Living Wage is £10.55 for those working in London and £9 for those working across the rest of the UK. As we shall see, the UK Government introduced its own version of the Living Wage in 2016, but this is less generous. This was effectively a higher National Minimum Wage rate for people aged over 25.
As the Foundation states:
“The real Living Wage rates are higher because they are independently-calculated based on what people need to get by. That’s why we encourage all employers that can afford to do so to ensure their employees earn a wage that meets the costs of living, not just the government minimum.”
A link to the website of the Living Wage Foundation can be found below:
The introduction of the National Minimum Wage Act 1998 ensured that workers must receive a basic hourly wage depending on their age.
One of the most important changes to the National Minimum Wage Scheme since February 2005 is the inclusion of young workers i.e. young persons aged 16 and 17 years old. Previously, these individuals were not covered by the National Minimum Wage Act 1998. The British Government, however, finally accepted the recommendation of the Low Pay Commission that the Scheme should be extended to young workers.
The Living Wage
In many respects, the debate about the National Minimum Wage has moved on from the late 1990s when organizations such as the Conservative Party, the Confederation of British Industry and the Institute of Directors were uniformly hostile to its introduction by the first Labour Government of Tony Blair (1997-2001) on the grounds that immense damage would be done to the British economy. These fears were not realized and the minimum wage has become an accepted feature of British employment rights. The debate concerns the introduction of the Living Wage.
The Living Wage Foundation actively calls on employers to pay an enhanced income ensuring a basic standard of living. The Labour Party had promised to introduce a Living Wage if elected to form the next UK Government in 2015 and it was thought that, with the Party’s defeat at the last General Election, the idea would be placed on ice during the next Parliamentary term. It was therefore somewhat surprising when George Osborne, the former Conservative Chancellor of Exchequer announced, during his 2015 Autumn Statement, that the Coalition Government intended to introduce a National Living Wage in April 2016.
From 1 April 2016, under the National Living Wage, employers had to pay workers over the age of 25 (and who are not in the first year of an apprenticeship), a minimum hourly rate of £7.20. These individuals must work 2 or more hours a day for 8 or more consecutive weeks of the year. There was no requirement to pay the National Living Wage to volunteers, interns and apprentices – as well as contractors on the supply side. Critics of the Coalition Government were quick to point out that the statutory rate was less than what was understood by the real Living Wage recommended by the Living Wage Foundation (i.e. £7.85 per hour or £9.15 inside London). The Coalition Government had stated that it was committed to raising the National Living Wage by 2020.
From 6 April 2019, the National Minimum Wage will rise from £7.83 per hour to £8.21. The real Living Wage for 2019-20, however, has been set at an hourly rate of £9 outside London and £10.55 inside London.
Employers who refuse to pay the National Living Wage will face enforcement action similar to that already carried out in relation to the National Minimum Wage.
There is no doubt that the Living Wage is an idea whose time has come. It is worth noting that many employers already pay their workers the real Living Wage on a voluntary basis and proudly publicise this fact.
The concept is not without its critics and the BBC reported on 1 April 2016 that the independent Office of Budget Responsibility had calculated that as many as 60,000 jobs could be lost as a result of its introduction. As we have discussed, similar claims in the late 1990s were made about the introduction of the national minimum wage and these proved to be largely groundless.
The positive impact of the National Living Wage seems to be supported by research carried out by the Ulster University Economic Policy Centre. In Northern Ireland alone from 2020 onwards, 128,000 people will benefit from a pay increase due to the National Living Wage being increased.
More than 128,000 in NI will get a pay rise by 2020 due to the National Living Wage, study suggests.
Postscript
The Low Wage Commission published research at the end of April 2019 showing that the number of workers who do not receive the national minimum wage increased in 2018. A link to the Commission’s report can be found below:
Seán Crossan's Scots Law 