Transcript WITHOUT PREJUDICE In the Employment Appeal Tribunal

Choice Autumn Chestnuts
An Employment and Law Seminar
Silverman Sherliker LLP
A Review of Recent Employment Law
Victoria J Russell
Solicitor – Employment Law
Email: [email protected]
A Review of Recent Employment Law
1.
Changes of Contract Terms Without Employee
Consent
2.
The Fairness of the Dismissal
3.
The Without Prejudice Rule
CHANGES OF CONTRACT TERMS WITHOUT EMPLOYEE CONSENT
Bateman and Others v Asda Stores Ltd
Employment Appeal Tribunal
Background:
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18,000 employees on old pay structure.
Extensive consultation process about new pay structure.
9,300 employees agreed to transfer voluntarily to new pay
structure.
8,700 employees had their pay structure changed by Asda
anyway.
Asda relied on Company Handbook to make unilateral
decision to change pay structure anyway.
CHANGES OF CONTRACT TERMS WITHOUT EMPLOYEE CONSENT
Bateman and Others v Asda Stores Ltd
Employment Appeal Tribunal
Claims:
• Employment Tribunal Claims brought by 700 employees.
• Claims included unauthorised deduction from wages, breach of
contract and, in some cases, unfair dismissal.
• Six test cases heard by Employment Tribunal and then
Employment Appeals Tribunal.
CHANGES OF CONTRACT TERMS WITHOUT EMPLOYEE CONSENT
Bateman and Others v Asda Stores Ltd
Employment Appeal Tribunal
Deciding Factors
• Company Handbook said it reserved the right to amend the
content of this handbook from time to time to reflect the
changing needs of the business.

Company Handbook said that sections relating to pay and the
right to change terms formed part of the employees’ contracts
of employment.
• No employee suffered a reduction in pay
CHANGES OF CONTRACT TERMS WITHOUT EMPLOYEE CONSENT
Bateman and Others v Asda Stores Ltd
Employment Appeal Tribunal
Decision
•
Asda was able to rely on a provision in the Company
Handbook which reserved the right to vary contractual terms
to introduce a new pay structure without the need to obtain
express consent of employees affected by the change.
•
Power to make unilateral change was not limited to noncontractual policies since the handbook included contractual
matters including pay and hours.
CHANGES OF CONTRACT TERMS WITHOUT
EMPLOYEE CONSENT
Bateman and Others v Asda Stores Ltd
Employment Appeal Tribunal
In practice
•
Never make unilateral changes to pay structure.
•
Always need to consult on changes of pay structure or
those which cause the employee to suffer a detriment.
•
In this case there was no claim for breach of trust and
confidence- might have had a different outcome if there had
been such a claim.
•
However, case does show that widely drafted contractual
variation clauses can be used as a last resort after the
consultation process has been exhausted.
THE FAIRNESS OF THE DISMISSAL
THE FAIRNESS OF THE DISMISSAL
Background
•
Once the fact of a dismissal has been established, the Employer
needs to demonstrate:
• What the reason/reasons were for the dismissal;
• If the reason was one of the 6 accepted reasons for dismissal.
•
The Employment Tribunal will investigate the real reason for the
dismissal in any event.
•
The burden is on the Employer to prove the reason and it can only
rely on facts known at the time of the dismissal.
THE FAIRNESS OF THE DISMISSAL
The six accepted reasons for dismissal according to the
Employment Rights Act 1996:
1.Capability or qualifications
2.Conduct of employee
3.Retirement of employee
4.Employee was “redundant” (within legal definition)
5.Statutory requirement
6.“Some other substantial reason”
It is a question of law for the Tribunal to determine the accepted reason
for a dismissal.
If Employer claims a different reason to that decided by the Tribunal, the
Tribunal must find the dismissal to be unfair
THE FAIRNESS OF THE DISMISSAL
Capability/Qualifications
•
Capability is assessed by reference to an employee’s “skill,
aptitude, health or any other physical or mental quality”.
•
The capability must relate to the work the employee was
employed to do. The dismissal may be fair even if the
employee is still able to perform part of the job.
•
A dismissal will relate to an employee’s qualifications if it
relates to any “degree, diploma or other academic, technical
or professional qualification” relevant to the employee’s
position.
THE FAIRNESS OF THE DISMISSAL
Conduct
•
It is potentially fair to dismiss an employee for misconduct,
which may be a single act of serious misconduct or a series
of acts which are less serious.
•
These could include: disobeying reasonable orders, breach
of certain express or implied terms of contract, theft or
dishonesty, unauthorised absence from work, disclosure of
confidential information, competing, or preparing to compete.
•
Must be able to establish that, at the time of dismissal, the
employer believed the employee to be guilty of misconduct
and had reasonable grounds for this belief based on
reasonable investigation.
THE FAIRNESS OF THE DISMISSAL
Retirement
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Retirement will be the only reason for the dismissal where:
o The employee has no normal retirement age and the
operative date of termination falls on or after the date on
which the employee reaches 65.
o The employee has a normal retirement date (which is 65
or over) and the operative date of termination falls on or
after the date when the employee reaches that age.
o The employee has a normal retirement date below 65
and that retirement age has been objectively justified.
THE FAIRNESS OF THE DISMISSAL
Redundancy
A dismissal is potentially fair when it is “wholly or mainly
attributable to there being either:
• Business closure;
• Workplace closure; or
• Reduced requirement for employees.
THE FAIRNESS OF THE DISMISSAL
Statutory Requirement
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A dismissal is potentially fair if the employee’s continued
employment would contravene any duty or restriction
imposed by or under any enactment.
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Employer must show that the employee’s continued
employment would actually contravene a statutory restriction.
THE FAIRNESS OF THE DISMISSAL
“Some Other Substantial Reason”
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No further guidance in statute as to what is meant by this term.
•
Designed to catch potentially fair dismissals which would not fall
into any of the other categories.
•
The employer only has to establish that there was “some other
substantial reason” that could justify the dismissal. It is for the
Tribunal to decide if it was reasonable to dismiss the employee in
the circumstances.
THE FAIRNESS OF THE DISMISSAL
“Some Other Substantial Reason”
A v B Employment Appeal Tribunal
Background
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Employee “A” civil servant, offered job relating to the interests of
children, but not working with children.
Allegations from “Metropolitan Police Child Abuse Investigation
Command” that employee posed a “continuing threat to children”.
Employer was advised that the allegations against the employee
carried a “significant risk of reputational damage”.
Employee disciplined, but denied allegations.
Employer took advice from Metropolitan Police and dismissed the
employee for breach of trust and confidence.
THE FAIRNESS OF THE DISMISSAL
“Some Other Substantial Reason”
A v B Employment Appeal Tribunal
Claims
• Employee claimed unfair dismissal.
• Employment Tribunal decided dismissal was fair.
• Employment Appeals Tribunal upheld the Tribunal’s decision that the
dismissal was fair.
THE FAIRNESS OF THE DISMISSAL
“Some Other Substantial Reason”
A v B Employment Appeal Tribunal
Decision
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Employment Appeal Tribunal accepted that although the
allegations were unproven, the serious reputational risk they
posed to the public sector employee, if they should later be
proved to be true, qualified as a “some other substantial reason”
for dismissal.
As in this case, provided that adequate safeguards were in
place, and a proper procedures followed, a dismissal in such
circumstances could be fair.
THE FAIRNESS OF THE DISMISSAL
“Some Other Substantial Reason”
A v B Employment Appeal Tribunal
In Practice
•
Reputational risk to the employer can qualify under “some
other substantial reason” for dismissal.
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Third party allegations can be relied on provided that it is
from a reliable source and offers critical analysis.
•
As with all dismissals, it is important to consider why
dismissal is being contemplated and if it is the appropriate
sanction.
WITHOUT PREJUDICE
WITHOUT PREJUDICE
Background
The Without Prejudice rule will generally prevent statements made
in a genuine attempt to settle an existing dispute, whether made in
writing or orally, from being put before the court as evidence of
admissions against the party which made them.
WITHOUT PREJUDICE
Rush & Tompkins Ltd v Greater London Council and others
•
“The contents of the without prejudice correspondence will
not be admissible to establish any admission relating to the
[party's] claim."
•
For these purposes, the term "admission" does not mean a
formal admission, but rather a statement made by a party
against his own interest.
WITHOUT PREJUDICE
Rush & Tompkins Ltd v Greater London Council and others
Label
Always try to remember to use the Without Prejudice label where appropriate:
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“To make clear beyond doubt that in the event of the negotiations being
unsuccessful that they are not to be referred to at the subsequent trial”.
However, the presence, or absence, of the Without Prejudice Label will not
be determinative.
•
“The application of the [Without Prejudice] rule is not dependent upon the
use of the phrase 'without prejudice' and if it is clear from the surrounding
circumstances that the parties were seeking to compromise the action,
evidence of the content of those negotiations will, as a general rule, not be
admissible at the trial and cannot be used to establish an admission or
partial admission."
WITHOUT PREJUDICE
In the Employment Appeal Tribunal:
• Without Prejudice rule is generally admissible but there are
some exceptions to this rule.
• One exception to the without prejudice rule relates to
“unambiguous impropriety”
• Previous case law established one exception to the without
prejudice rule where the exclusion of evidence “would act as a
cloak for perjury, blackmail or unambiguous impropriety”
Unilever v Proctor & Gamble Company
WITHOUT PREJUDICE
BNP Paribas v Mezzotero
Employment Appeal Tribunal
Unambiguous Impropriety
If an employer, in dispute with a black employee, says during
discussions aimed at settlement in a meeting, expressed to being
held without prejudice “we do not want you here because you are
black” and tried to exclude these discussions in a Tribunal hearing
for race discrimination because of the without prejudice rule, the
remark would fall under the level of unambiguous impropriety.
(Obiter comments in BNP Paribas v Mezzotero by Cox J)
WITHOUT PREJUDICE
BNP Paribas v Mezzotero
Employment Appeal Tribunal
Background:
• Employee returned to work after maternity leave, raised a
grievance.
• Asked to attend a meeting which was said by Employer to be
“Without Prejudice”.
• Employer said it was not feasible for her to return to her old job
and there were no alternatives.
• The Employer offered the Employee a redundancy package on
account of it being “best for business”.
• Employee claimed sex discrimination.
WITHOUT PREJUDICE
BNP Paribas v Mezzotero
Employment Appeal Tribunal
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Decision:
Employment Appeal Tribunal held that there was no dispute
between the parties about termination and so the without
prejudice rule did not apply.
Cox J decided that the case fell within the “unambiguous
impropriety” rule in relation to a genuine and legitimate
complaint of sex discrimination.
It was held to be a cynical abuse of the without prejudice rule in
order to hide discriminatory behaviour.
Held that the employer conduct fell within the umbrella of
unambiguous impropriety and as an exception to the without
prejudice rule within the abuse principle
WITHOUT PREJUDICE
BNP Paribas v Mezzotero
Employment Appeal Tribunal
In Practice:
This case opened the floodgates for employees pursuing
discrimination claims, to allow an exception to the without prejudice
rule, diluting the requirements of the unambiguous impropriety
exception in discrimination cases to permit employees to refer to
without prejudice negotiations in the course of proceedings.
It has now been followed by the Woodward and Santander case
which has helped to close these floodgates.
WITHOUT PREJUDICE
Woodward v Santander UK plc
Employment Appeals Tribunal
• Employment Appeals Tribunal confirmed that discrimination is
not a special category when it comes to considering exceptions
to the without prejudice rule.
• In order for a court to allow a party to put into evidence details of
without prejudice discussions between the employer and former
employee, there must be clear evidence of abuse.
WITHOUT PREJUDICE
Woodward v Santander UK plc
Employment Appeals Tribunal
Background:
• Miss W dismissed in 1994, brought proceedings for unfair
dismissal & sex discrimination.
• Claim was settled although there was no agreed reference.
• Miss W found it difficult to obtain new employment, suspected
that she was being provided a poor reference.
• In 2002 she challenged Santander about this and then brought
a claim in the Employment Tribunal.
• Miss W tried to rely on without prejudice settlement negotiations
relating to Santander providing a reference which Santander
had refused.
WITHOUT PREJUDICE
Woodward v Santander UK plc
Employment Appeals Tribunal
Decision
• Miss W was not entitled to introduce evidence of the without
prejudice negotiations.
• Although Miss W suspected impropriety, she had no actual
evidence of it.
• There should not be varying degrees of unambiguous
impropriety; the refusal to provide a reference did not amount to
unambiguous impropriety.
• The exception to the without prejudice rule should be interpreted
narrowly otherwise a party could comb through the
correspondence or discussions to point to equivocal words or
actions in support of an inference of discrimination.
WITHOUT PREJUDICE
Woodward v Santander UK plc
Employment Appeals Tribunal
In Practice
• The case reiterates the policy of the without prejudice rule that
parties should not be discouraged from settling their disputes by
fear that something said in the course of negotiations may be
used to their prejudice in subsequent proceedings.
• This case provides for employers in that discrimination claims are
not a blanket exception to the general rule of without prejudice
negotiations.
• Provided that actions do not amount to blatant discrimination,
employers can negotiate freely. There is a high threshold and
pointing out evidence from which inferences can be drawn is not
sufficient.
Getting the Redundancy Process Right
Martin Donoghue
Partner – Employment Law
Email: [email protected]
What is Redundancy?
• A legal reason for dismissal.
• Three classic examples:
– Business Closure
– Workplace Closure
– Other requirement for fewer employees
What should I do?
• Is it necessary?
• Follow the correct process.
– Fewer than 20 proposed redundant within
90 days.
– Possible shortcut where a whole
team/level goes.
– 20 or more redundant within 90 days.
– DTI notice.
What should I not do?
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False economy.
Smoke and mirrors.
False shortcuts.
Treat employees differently.
End up without necessary skills.
Age Discrimination Update
Nicholas Lakeland
Head of Employment Law
Email: [email protected]
The Employment Equality (Age) Regulations 2006
Replaced by The Equality Act 2010
The basics:
1. No direct or indirect discrimination.
2. No victimisation.
3. No Harassment.
The Employment Equality (Age) Regulations 2006
Replaced by The Equality Act 2010
BUT
An Employer can discriminate if the
Employer is able to show that it was a
“proportionate means of achieving a
legitimate aim”
(s13 (2) of the Equality Act 2010)
Recent Case Law
The Incorporated Trustees of the National Council on
Ageing (Age Concern England) -v- BERR
&
R (Age UK) -v- BISS
• Challenge to the default retirement age of 65.
Recent Case Law
Seldon -v- Clarkson Wright & Jakes
• Forced retirement of partner in a law firm at
age 65.
• Justification.
• Low hurdle set by Court of Appeal.
Recent Case Law
Rolls Royce -v- Unite the Union
• Length of Service criterion in a redundancy
selection policy.
• Justification.
The Future
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Government intends to scrap default age of
retirement of 65 for employees from end of
2010.
What next?
Key Contacts
Nicholas C J Lakeland
Partner
Silverman Sherliker LLP
ncjl:@silvermansherliker.co.uk
SILVERMAN
SHERLIKER LLP
SOLICITORS
Martin D Donoghue
Partner
Silverman Sherliker LLP
[email protected]
Victoria J Russell
Solicitor
Silverman Sherliker LLP
[email protected]
Dave Thompson
HR Consultant
Silverman Sherliker Specialist HR Solutions
[email protected]
7 BATH PLACE . LONDON EC2A 3DR
FAX: 020 7739 4309 . E-MAIL
[email protected] . DX 137779
FINSBURY 5
wwww.silvermansherliker.co.uk
Tel: +44 (0) 20 7749 2700
Fax: +44 (0) 20 7739 4309
Key Contacts
Nicholas C J Lakeland
Partner
Silverman Sherliker LLP
ncjl:@silvermansherliker.co.uk
SILVERMAN
SHERLIKER LLP
SOLICITORS
Martin D Donoghue
Partner
Silverman Sherliker LLP
[email protected]
Victoria J Russell
Solicitor
Silverman Sherliker LLP
[email protected]
Dave Thompson
HR Consultant
Silverman Sherliker Specialist HR Solutions
[email protected]
7 BATH PLACE . LONDON EC2A 3DR
FAX: 020 7739 4309 . E-MAIL
[email protected] . DX 137779
FINSBURY 5
wwww.silvermansherliker.co.uk
Tel: +44 (0) 20 7749 2700
Fax: +44 (0) 20 7739 4309