Category: Employment Contract

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Anna Denton-Jones Compensation Discrimination Law Employment Contract Employment Law Employment Relations (Flexible Working) Act 2023 Employment Rights Act 1996 Equality Act 2010 Pay Remote Working Working from Home

Cutting pay for those who choose remote work

View of the City of London at sunset

This week I was happily reading a ‘People Management’ article about an employer who had moved to fully remote working who was extolling the virtues of having done so, particularly around productivity. The next headline that caught my eye was that Stephenson Harwood, a law firm, had announced a 20% pay reduction for employees who choose to continue to work from home on a full-time permanent basis.  

I’ll leave aside the damage that such a move might do to employee relations and just focus on the legal issues.

Firstly, any such manoeuvre would need to be agreed with the employee in writing because it is a change to the current contract of employment.  An employee who moves to full-time homeworking is changing their place of work as well as changing their pay, in this example. Thus any change has to be agreed to. 

The  employee will also become entitled to claim expenses for travelling to the office – in this case, the employer is requiring them to attend once a month.  

One of the interesting points for me is that that the law firm has a hybrid working policy and staff are already permitted to work remotely for 2 days each week, which seems to be the average that many employers are experimenting with.  Given that those employees are not being required to agree a change to their salary, one can immediately see equal pay arguments as there is unlikely to be substantial differences between the kind of work that the employee hybrid working is doing compared to the fully remote one. The firm would have to rely on the material factor defence to justify the difference in pay for employees who are allowed to work 2 days a week and those who are working from home 5 days a week.  This is unchartered territory but if I was a betting person, I would bet that a Judge would be reluctant to find that there was substantial difference, particularly as working from home remotely, the employer saves the cost of having to run a desk in the City, the employee takes on the burden, for example, of electricity during the working day.

All good HR people will instinctively twitch at the potential for discrimination claims.  If those who choose to work fully remotely, on a full-time basis, do so because they are carers, for reasons related to their childcare or disability, they are entitled to launch discrimination claims about the indirectly discriminatory impact this policy has on them.

The spokesperson from the law firm also made a real blunder in admitting that those adopting exclusively remote working practices would be likely to be ruled out of promotion to partner level. Whilst everyone has been talking about hybrid working, we have been worrying about distribution of work so that those who are most visible in the office do not benefit from training opportunities, promotion and opportunities to do certain kinds of work compared to their colleagues who may be less visible as they are not in the room. This bold statement merely highlights the very worst fears that we all had.  Again, this kind of attitude, if followed through into practice, is likely to give grounds for discrimination claims.

I am sure we are going to see the lessons learned as we move forward… it makes me sad when I see other lawyers in my profession setting the worst of examples.  Especially in a week where somebody reported a significant increase in the number of employers reporting increased productivity or efficiency from home and hybrid working arrangements.  This was based on a survey of a 1,000 employers.  What’s interesting about that survey is that they surveyed employers in December 2020 and then again in October and November 2021, with the numbers reporting a negative impact from home working and hybrid working falling and those reporting positive effects increasing, suggesting that as time has gone on through the pandemic, people have become more used to new working arrangements and support it.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Employment Contract Employment Law Employment Rights Act 1996 Equality Act 2010 Offer of Employment Redundancy Settlement Agreements Video

Video | Instructing a solicitor

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Our latest video is available to view on the Refreshing Law YouTube channel — please click here to watch Anna discussing the issues that need to be considered when instructing a solicitor.

Anna Denton-Jones
Refreshing Law

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Agency Workers Anna Denton-Jones Case Law Employment Contract Employment Law Employment Rights Act 1996 Recruitment Redundancy Settlement Agreements

The P&O situation

Boat at sea on the horizon

Whilst many will have looked at the behaviour of P&O and criticised them and they are undoubtedly at the extreme end of the spectrum, it has caused me to reflect on the extent to which all organisations from time to time “take a view” about legal risk and to some extent, price that into the decision-making process. I defy anyone in HR to say that they have never done this.

What I think the reaction demonstrates is how far we are moving forward and that ESG is becoming mainstream, with the debate and the discussion about P&O showing that organisations by and large ‘get’ the idea that it’s more than just about legal compliance but treating people fairly and with dignity as well as ensuring the right image for the organisation, in terms of its values is as important, given what can happen with social media.

The Government has clearly been on the backfoot — literally in the days leading up to P&O Friday, following a private members bill, attempting to tackle so called fire and re-hire practices, the Minister stood up in parliament and confirmed that the government had no intention of making any changes in this arena. Fast-forward a couple of weeks and now hasty announcements around a number of steps that are going to be taken in the maritime area to ensure National Minimum Wage etc.

The relevant issue for everyone is in relation to what they have said about a new statutory code on ‘fire and re-hire’ tactics which will be produced. It sounds as though this will be putting what Acas already advise onto a statutory footing, in the same way as we used to with the Disciplinary and Grievance Procedures. We are already used to Tribunals and Courts taking the Code into account when considering cases of unfair dismissal and them having the power to uplift the award that is made to any successful employee’s compensation by up to 25% where there has been an unreasonable failure to follow that Code. That is the model that is going to apply here.

At this stage we don’t have the actual Code but I would imagine that it will be following the guidance that is already there to consult with staff, taking into account the background legal position on this issue. Indeed the 11th November 2021 advice published by Acas suggests employers should fully consult their workforces and make every effort to reach agreement on any contract changes, noting that fire and re-hire is an extreme step that can damage staff morale, trust, productivity and working relations. So in effect this is just giving the Acas guidance statutory force. Currently there has been no confirmation of when exactly this will happen.

On another note it looks like the insolvency service has been tasked with considering the circumstances around the CEO of P&O’s failure to lodge the HR1 form which is a criminal offence and the responsible statutory director can be fined for this. I imagine that there is a certain amount of political pressure to ‘make an example’. I know a few years ago I looked into how many times this had actually been done and the evidence base was really small, to the point of being miniscule. However, there were directors who made redundancies during furlough who were prosecuted so there is a precedent. Even if an employer decides to do what P&O did and commence with statutory consultation because they would essentially be buying out that right by making ex gratia payments under a settlement agreement, it would still be important for the HR1 form to be filed as a protection for the directors involved.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Conflict Disciplinary Dismissal Employment Contract Employment Law Grievance HR

Employees bringing employers into disrepute

View of the City of London at sunset

A recent case that went to the Employment Appeal Tribunal highlights important issues for employers. The case of London Borough of Hammersmith & Fulham v Keable involved a local authority Public Protection and Safety Officer within the Environmental Health Department with 17 years’ service dismissed for serious misconduct arising out of comments he made at rallies outside parliament. The employee concerned had been filmed having conversations. That video made itself online without his knowledge or consent. He didn’t do anything to link his employment to the video. As a result of it being widely re-tweeted, he was publicly identified as the local authority’s employee.

The employee was an anti-Zionist and a member of the Labour Party and Momentum organiser who was attending the rally in his own personal time. The comments he was filmed making included controversial statements alleging the Zionist movement, prior to World War II, collaborated with the Nazis.

The Tribunal found that the videos were calm, reasonable, non-threatening and conversational. The employee explained that he didn’t intend to offend anyone – it was a private conversation involving an exchange of political opinions carried out between two people willingly.

A local councillor wrote to the employer calling for action against the employee so he was suspended and a disciplinary procedure was followed that led to his dismissal.

The employer acknowledged that the employee had freedom of assembly and expression which included a right to offend others (human rights). However, it found that his comments were likely to be perceived as unlawfully hostile on religious grounds and so brought the employer into disrepute. The Dismissing Officer didn’t find the employee had been guilty of discrimination or anti-Semitism but did find that “a reasonable person would conclude that the claimant had said that the Zionists had colluded with the holocaust”.

At the Employment Tribunal, whilst the Claimant’s conduct was potentially a fair reason for dismissal, procedurally the employer was found wanting – in particular:

  1. The employee had not been informed of the specific allegation which led to his dismissal; and
  2. The possibility of a lesser sanction of a warning wasn’t discussed with him.

The Tribunal found that he should be reinstated.

Whilst the case illustrates the sorts of issues employers are now getting embroiled in around social media and freedom of expression, what caught my eye was the basic weakness in the employer’s procedure ie:- that what the employee was accused of didn’t tally with what the decisionmaker ultimately dismissed him for. This isn’t uncommon. Often the allegations are framed at the stage where an employee is perhaps suspended pending investigation or a statement is made that covers a multitude, such as “your conduct in being filmed and the making of comments”. The disciplinary invite letter might be prepared centrally by HR from a template without any real liaison with the person who is potentially going to be making the disciplinary decision. There is always room for error here and before writing the disciplinary letter the writer should be thinking ahead to the evidence and what it does/doesn’t prove.

In this case, the employee quite reasonably asked which of his comments that had been recorded was offensive as this is what had been put in his invitation letter. The decisionmaker was thinking instead about the case in terms of his having suggested Zionists collaborated with the Nazis in the Holocaust – that was not put to the employee. The Tribunal easily found it was outside the range of reasonable responses to dismiss somebody for misconduct which hadn’t been put to them as part of the investigation or disciplinary process.

What can you do about this?

If the decisionmaker, having heard all of the evidence, wants to frame the outcome in a different way to the disciplinary allegations in the invitation letter, they should pause the process. They should then invite the employee to a further meeting to discuss the fresh allegation that they wish to consider and it may well be a relatively short meeting given all of the discussions that have already been held but it will be as important for the employee to be accompanied at the meeting as normal. They should then come to their decision.

Compensation was reduced by 10% because of the employee’s culpable conduct in making critical comments about the investigation report.

The employer appealed. Interestingly the Employment Appeal Tribunal upheld that it was procedurally unfair to not have raised with the claimant whether a warning was appropriate. Any employee, when questioned, would always say that a warning was preferable to dismissal! This is stretching the requirements of the ACAS Code of Practice. Yes, an employer should consider the appropriate lesser sanction as an alternative to dismissal but it is not a pre-requisite to consult the employee about that…

The safest thing to do is, routinely in disciplinary hearings, consider whether a warning would be an appropriate sanction and be seen to explain why it wouldn’t.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Conflict Employment Contract Employment Law Employment Rights Act 1996 Part-Time Working Video

Video | Employees being overemployed

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Our latest video is available to view on the Refreshing Law YouTube channel — please click here to watch Anna discussing the issues that may arise and what employers can do when an employee might have more than one job at the same time and ends up in a situation where they are overemployed.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones COVID-19 Dispute Management Employment Contract Employment Law Employment Tribunal Pay

Non-payment of commission due to COVID-19

Royal Courts of Justice, London

The Tribunal has recently dealt with a case relating to non-payment of commission due to COVID-19 in Sharma v Lily Communications. The employee concerned had a basic salary and then commission based on 15% of profit that the business made. This was paid upfront and agreed at interview.

The clause in the contract, followed the common wording that “in addition to your salary the Company may pay you commission of such amount as shall from time to time be determined by the Company in its absolute discretion. Any commission payments will be paid at such intervals and subject to such conditions as the Company may in its absolute discretion determine from time to time. Any commission payment to you shall be purely discretionary and there is no contractual entitlement to receive it and it shall not form part of your contractual remuneration or salary for pension purposes or otherwise. If the Company makes a commission payment to you, it shall not be obliged to make subsequent bonus payments in respect of subsequent financial years of the Company. The Company reserves the right in its absolute discretion to terminate or amend any commission scheme without notifying you”. Do you think the employer were keen to make sure the commission scheme was discretionary with their three mentions of it?

Later the employer tried to change the position, imposing a new commission structure but the judge found that this hadn’t been communicated to or agreed with the Claimant. This is the first important point: an employer cannot just move goal posts – any change has to be agreed with the affected employees.

When COVID hit, the employer realised it was at risk of non-payment by its customers so changed to paying commission only when it had been paid not upfront, reducing the earnings of the Claimant. The Claimant was furloughed and challenged why he wasn’t receiving commission on deals he knew had been signed and paid. He was told during furlough commission was deferred. The Claimant didn’t return to work – he was made redundant in August 2020.

The Claimant brought a claim for over £5,000 commission he said he should have been paid during the period April to August 2020 and was successful. The Tribunal found that the scheme was discretionary but noted that even where a scheme is discretionary there is still a contractual obligation to exercise that discretion rationally and in good faith. The judge found that the uncertainty over the pandemic was a paradigm example of a situation where the employer would want to exercise discretion in a different way so deferring payment was OK. However, when his employment was terminated, the accrued commission should have been paid.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Communication Employment Contract Employment Law Employment Rights Act 1996 Overtime Right to Work

The right to disconnect — Tread carefully

View of the City of London at sunset

As more and more of us feel that we are losing the ability to switch off from work and take an uninterrupted rest, which is of course required under the Working Time Regulations, more and more discussion is taking place about whether we need some kind of “right to disconnect”.

The French led the way in 2017, amending their Labour Code to include this right for employers with more than 50 people – their law requires the employer to negotiate with employee representatives to control the use of digital tools. Italy, Spain, Slovakia, Luxembourg, Netherlands and Germany have all followed suit with Ireland being the most recent addition. In Ireland their Code of Practice requires employers to have a policy in place which confirms that employees have a right not to work outside of normal working hours, that employers and colleagues should not routinely email or call outside of those working times and the employee should not be penalised for refusing to work during non-working hours.

Whilst that Code of Practice doesn’t have the force of law of in the sense that breaching it leads to a claim for damages, it could be used as a supporting argument when somebody is bringing a claim about something like breach of working time, health and safety legislation or bullying and harassment or plain old breach of the implied term of trust and confidence for a constructive dismissal.

You may have seen email footers that more routinely now set out the times in which somebody is likely to be contactable and/or answering their messages. More and more employers are carving time out in diaries when meetings cannot be timetabled and dictating that meetings should not be timetabled at unsociable hours, save in emergency circumstances.

Initially I took the view that employers in the UK should not be waiting for our Government to legislate, (the TUC has called for the Government to include something in the Employment Bill but there is no indication that they are thinking of it) and encouraging employers to incorporate something into their policies and procedures.

However, I also remember the days before the Blackberry when my desktop PC sat on my desk in the office and I was unable to deal with email correspondence if I wasn’t physically at my desk. I remember being given a small square to stick on the back of my hand by a colleague that I did some stress at work training with for a large employer. The square would change colour back to blue when your body chemistry changed and your body was full of the stress hormones, cortisol. As an experiment I kept this and placed it on my hand the next day that I was due in the office. I remember driving to work and monitoring the situation. During my commute to work, when I was beginning to think about work, the feedback was that I was not suffering from stress. However, as I approached the door and was using my door entry fob, that is when my stress levels rose, telling me that the anticipation of what I might find when I logged my computer on was stressful to me.

I approached my desk and duly logged on and my stress levels remained high until the time when I’d managed to see what was there and prioritise what was urgent and what else could take a bit longer to deal with. Once I had a handle on the situation, the colour of the square returned to normal.

When the ‘Blackberry’ was introduced (which is a form of mobile phone for those you who are too young to remember!), allowing me for the first time to have email on the go I remember thinking it was a positive thing and that now in the short moments that you might have waiting somewhere or when you have parked your car, you keep an eye on things, delete the rubbish and then arrive back at my desk ready to roll because I would know what things I needed to deal with and when. That’s many years ago now and I’ve still always thought that the ability to have your email follow you has actually been a positive thing on balance.

What is different now stems from a number of issues:

  1. The sheer volume of emails being sent. From employees being copied in on emails that they don’t need to be, to having email conversations with colleagues when actually a quick phone call would be much more efficient, those emails where people won’t let go of the conversation and so send another email…. The list goes on.
  2. Remembering email is just a tool – it is how we use it for good or ill that counts. What I am noticing is that the pandemic seems to have put everybody to a state of ‘high alert’ where everything is urgent and everybody expects a response now and timelines have become unmanageable and isn’t it that that is the issue rather than being connected?

Any employer considering how they deal with mental health issues and wellbeing particularly as we move towards more hybrid forms of working, will need to be putting in place guidance around employees not feeling that they need to work outside their set hours but the key underlying issue is workload and I would suggest that it’s workloads in general that need to be being looked at rather than focusing solely on something like the right to disconnect. It will only ever be part of the jigsaw puzzle.

On 21 January 2021, the European Parliament approved a Resolution asking the Commission to introduce a Directive to establish the minimum requirements for remote work across the EU which would include the ‘right to disconnect’. That would require employers to establish a detailed written statement setting out arrangements for switching off digital tools for work purposes; set out systems for measuring working time; encourage training and awareness of the right to disconnect in the workplace and make sure that workers don’t suffer adverse treatment or dismissal for having exercised their right. This will undoubtedly reinforce things across Europe and employees are naturally going to start to gravitate towards those organisations that they feel are looking after them and shunning those who they feel are abusing their private lives by intruding on them.

We are likely to see rapid change in this area but I would caution employers to look at the whole picture and not just this narrow aspect. A poll conducted by Owl Labs and reported in People Management found that lots of employers are considering implementing shorter working weeks with others concerned that focusing on core working hours could be to the detriment of those who have to work in a flexible way for caring reasons including parents. This is a topic I will return to.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Articles Dismissal Employment Contract Employment Law Employment Rights Act 1996 Employment Tribunal Redundancy Unfair Dismissal

What employers get wrong when dismissing staff

Royal Courts of Justice, London

The most common mistakes employers make when dismissing people (in no particular order) are:-

  • Inconsistency of decisions  – dismissing for something that the last person who did it just had a warning for  this is unfair. If you want to distinguish between cases you have to be able to justify it on reasonable grounds such as the length of service and previous good record of the employee given the warning compared to the one that was sacked.
  • Failure to investigate properly  an employer has to have a reasonable belief based on the evidence before them that an employee is guilty of misconduct. Even if an employee denies something outright if you have reasonable grounds to believe they were involved or did do something  you don’t need cast iron proof that they did, unlike criminal law, but you do need to have conducted a reasonable investigation.
  • Dismissing someone for poor attendance record when they have a medical condition such as depression which could qualify as a disability under the disability discrimination legislation (Equality Act). The employee then claims not enough was done to accommodate their medical position.
  • Pre-preparing letters of dismissal and presenting them to the employee at the end of the meeting  this makes your decision look pre-judged and will result in the dismissal being unfair. You must keep an open mind  there could be a reasonable explanation behind the situation as it appears to you.
  • Decision-makers taking account of matters which are not discussed in the disciplinary hearing ie:- the employee doesn’t get a chance to address this evidence and so the dismissal is unfair.
  • Not having an appeal stage or the appeal decision-maker getting involved in the case when the original decision to dismiss is made so that they are not impartial which is unfair.
  • Rushing eg:- walking someone into your room, ambushing them with an allegation, deciding they are in the wrong and dismissing them. Notice of a disciplinary hearing should be given at least 24 hours before the meeting and it often helps to think overnight before coming to a conclusion and confirming dismissal, even if you have known all along that is where you are heading  that does mean it could take at least 72 hours  to follow this stage of the procedure but it is worth investing the time upfront to protect you against criticism at a later stage.
  • Not giving the employee the opportunity to be accompanied by a companion – failure to do this can result in a Tribunal award of up to 900

Anna Denton-Jones
Refreshing Law