Tag: Employment Tribunal

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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 Dispute Management Employment Law Employment Rights Act 1996 Employment Tribunal Grievance Investigations Victimisation

Dangers of a victimisation claim

Royal Courts of Justice, London

A recent case illustrates the risk employers face every time they receive a grievance in relation to a victimisation complaint.

If the grievance has any kind of discrimination angle to it, bullying harassment or an argument about less favourable treatment because of a protected characteristic or an allegation that the employer has failed to make reasonable adjustments to accommodate a health issue, the employer also runs the risk of a victimisation complaint.

The raising of the grievance, if it references the protected characteristic and allegations of some form of discrimination, becomes a “protected act”. If, as a result of that protected act, the employee then suffers some other detriment, this will give them grounds to claim victimisation.

This can be as simple as suffering the consequences of colleagues knowing that a grievance has been raised and behaving differently towards the person who has raised the grievance as a result. For example, a manager who has been accused may be very angry about the accusation that has been made or other colleagues who are interviewed as witnesses in the grievance process might change their behaviour towards the individual, “sending them to Coventry” or even telling them that they agree with what the employee has done. One of the first mediations that I was ever involved with, involved this scenario where a colleague clearly felt a manager didn’t deserve to be criticised by the other employee who had raised a grievance.

A recent case that illustrated this, was a case against Online Travel Training Group Ltd by Mr Weinreb. He was a Business Development Manager and had some kind of altercation with a Finance Manager after asking for her help. It sounds as though the Finance Manager didn’t like the employee and felt he should have known how to do the things he was asking for help with. The Tribunal felt that she goaded him and created conflict. Another colleague implied Mr Weinreb had been Jewish during a discussion about team work, and he also alleged that a conversation about the gay dating app ‘Grinder’ implied his colleagues thought he was a closet homosexual.

The case ended up in cross-grievances – the Finance Manager raised a grievance against Mr Weinreb because he recorded a conversation held about his commission. Mr Weinreb raised a grievance alleging discrimination and complaining about how an employment review meeting had been held.

Faced with the cross-grievance, the Managing Director missed the opportunity to go to a mediator and really get to the bottom of what was going on between the two individuals. Instead the pair were told that they should only communicate with each other by email (Tip: never go down that route).

Matters were investigated but played down – the Finance Manager was reminded of her obligation to show respect to her colleagues. Mr Weinreb attended a Grievance Outcome Meeting with the Managing Director who sounds like she lost her temper. At one point, she banged on the desk and told Mr Weinreb that she was very upset and offended by his allegations of discrimination about his colleagues (Tip: never do this!).

Mr Weinreb clearly didn’t feel listened to and this is a very important part of any grievance process and so appealed the grievance outcome.

The company subsequently dismissed Mr Weinreb for his “unacceptable conduct”. The Managing Director felt that his allegations had been spurious.

The banging on the table at the grievance outcome and failure to give Mr Weinreb any details about why his employment was being terminated were the acts of victimisation in this particular case. It was found that the Managing Director would not have behaved in the way that she had, had the employee not complained of discrimination in the first place.

Since employers are vulnerable to the emotional responses of those accused in grievances and those around them, it is very important that employers must always make it clear to those involved that any mistreatment of the employee who has raised a grievance will, in itself, be a disciplinary issue and that they are alert to their behaviour so that they can take action when necessary.

Refreshing Law
3 June 2021

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Anna Denton-Jones Compensation Constructive Dismissal Disability Diversity Duty of Care Employment Law Employment Rights Act 1996 Equality Act 2010 Health Conditions Protected Characteristics

We can learn from a recent disability discrimination case

Royal Courts of Justice, London

Last year, a university law lecturer at BPP University named Elizabeth Aylott was constructively unfairly dismissed and unfavourably treated because of something arising from her disability, despite the fact that other disability related claims were dismissed. She suffered from autistic spectrum disorder, anxiety and depression, which were her disabilities.

A member of the management team talked about her with a colleague and referred to her as a good worker but “mad as a box of frogs”. This comment then got back to her.

She found herself working very long hours including weekends and evenings.

A complaint resulted in a breakdown in the relationship with her employer, in particular, the employer did not allow her to see the complaint or defend herself.

Those three acts were found to be unfavourable treatment, as was the failure to refer her to occupational health.

Other concerns involved a crass and insensitive remark made about how she should have been able to handle her workload – this was inappropriate in the context of what was clearly a poor mental state.

Her employer was found to have failed to reduce her workload or provide extra support or heed any of the indications that she was not coping. Given the numbers of people who are experiencing challenges through the pandemic, you can see how easily an employer can fall into this trap and be found to be guilty of failing to do the right things.

Whenever anybody is complaining of their workload, the hours that they are working or exhibiting other signs that they are suffering from stress and not coping, which could be falling productivity, unusual disengagement or irritability and being more sensitive than normal in relation to normal day to day work related matters, an employer should be considering what they can do to support the employee.

One of the interesting things in this case, is that the employee found a job fairly quickly, so within a 3 month period of her having resigned. However, the Employment Tribunal still awarded her £71,000 worth of compensation for future losses (presumably her new job did not pay as much), £32,000 for past financial losses – so bridging the gap between the jobs, and £20,000 for injury to feelings. The Judge noted that the discriminatory conduct had been integral as to why she chose to resign and that although she had commenced working elsewhere, she remained unwell throughout the period up to the Hearing, when she was able to talk about how the treatment she had received had affected her. This shouldn’t be underestimated.

Managers need to be aware that during a Section 15 of the Equality Act claim that somebody has suffered from discrimination arising from a disability, they need to do the following:

  • Show that their disability causes “something”. That something might be fatigue or more stressed when under pressure or to lose their concentration or not perform as well under pressure.
  • If as a result of that “something” they then receive unfavourable treatment, so that might be performance management, sickness absence management or they aren’t promoted, put forward for training or allocated work, those actions can then be connected back to the disability. The employer has to then show that they are pursuing a legitimate aim and have done so in a proportionate manner when carrying out those actions.
  • For example, it may be that managing absence or attendance at work is a legitimate aim but if the employer has not obtained occupational health advice and has not made real efforts as regards reasonable adjustments, the employer is unlikely to be able to show that their actions were a proportionate means of achieving a legitimate aim.

Anna Denton-Jones
Refreshing Law

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Acas Anna Denton-Jones Disclosure Employment Law Employment Rights Act 1996 Employment Tribunal Grievance Investigations

Does an employer have to disclose the investigation report?

View of the City of London at sunset

At first glance, one might think the answer to this question was rather obvious, in that the employee raising the grievance is going to want to see that the investigation has been done thoroughly and fairly in order to be able to accept that the employer is following the correct processes based on the evidence.  Indeed, if you didn’t disclose these papers to the employee, it is likely to foster distress and further antagonise what may already be the steps on the way to a breakdown in trust and confidence between the parties.

Having said that, are there circumstances in which you can decline to show the employee parts of the evidence?  It is worth noting that the ACAS Code of Practice in relation to grievance procedures does not grant a specific “right” to the employee to see witness statements or any evidence that is part of an investigation.  

The employer is likely to be having to balance the rights of the employee against the rights of others who have also been named in the report, and to whom it may also owe duties such as  confidentiality, if that were the only basis on which it could obtain evidence.

The ACAS Guide to Conducting Workplace Investigations states “if an individual wishes to see a report they have been named in, they have got a right to see any parts of the report that contains information about them or that is reliant on information they have provided”.  That makes sense because they may want to correct a mistake that you have made in quoting them or if they disagree with an interpretation that has been made by the investigator. The ACAS Guidance goes onto say “however, they should not be allowed to see private information belonging to other individuals”. Thus, you would not necessarily be disclosing to them the entire report.  It may be that in sensitive cases, where perhaps co-operation in an investigation has only been able to be obtained by witnesses being promised anonymity, certain parts of the report/statements would have to be redacted.  In such circumstances, it may be that you change the names and other identifying information to, for example, numbers or letters, say witness B etc.

Ultimately, it is down to the employer to decide what the best thing to do is in each case and we would recommend that the rationale for acting in a particular way is recorded at the relevant time, so that if it is challenged later, at appeal or through the Tribunal, there is a record of the decision-making process.

Anna Denton-Jones
Refreshing Law

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Anna Denton-Jones Articles Collective Redundancy Compensation Dismissal Employment Law Employment Rights Act 1996 HR Notice Periods Redundancy Unfair Dismissal

Things to know when dismissing a member of staff

View of the City of London at sunset

The main risks

Anyone sacking a member of their staff faces three main types of potential push back by their ex member of staff. Firstly, the employee may claim they have not received the correct notice pay or other sums owed to them, secondly, they may claim unfair dismissal, once they have 2 years’ service and thirdly, they may claim discrimination.

Unfair dismissal claims are capped at 1 years’ salary or £74,200 compensatory award and a further basic award of up to £13,500 – depending on financial losses of the employee but discrimination awards are uncapped and may include damages for injury to feelings up to £36,000. That said, it is important to note that average awards are much less – between £4-5,000 for unfair dismissal and £12,000 for discrimination.

So how can you protect yourself?

Key advice is: Put yourself in the employee’s shoes and think about how you would want to be treated. If you follow that commonsense rule you shouldn’t go too far wrong eg:- you are likely to investigate the situation thoroughly, listen to all sides including the employee before making a decision and not jump to conclusions. Canny employers draft a provision into the contract of employment enabling them to suspend an employee pending an investigation – this protects the business for example, a disgruntled employee cannot then contact customers or destroy computer evidence relevant to the investigation.

Follow a procedure – for unfair dismissal purposes you have to show that not only did you have a good reason to dismiss (such as the person being incapable of doing their job or guilty of misconduct) but you have to show that you have acted “fairly and reasonably in all the circumstances”. This certainly means following the basic steps outlined above but the ACAS Code of Practice on Discipline and Grievance should be the employers’ touchstone here – Employment Tribunals judge you by this standard and expect you to be familiar with it – it also contains handy flowcharts.

Whilst employees are entitled to bring a companion along to a meeting in which they are dismissed (a colleague or trade union official) you may also want to take a witness along. This person could help you take notes of the meeting but is also there to protect you as they can confirm you acted fairly if challenged.

So where do people tend to go wrong?

The most common mistakes 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 dismissed.
  • 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.
  • 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. 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 making the case automatically unfair 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 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

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Anna Denton-Jones Articles Employment Law Employment Rights Act 1996 Employment Tribunal Grievance HR Investigations Unfair Dismissal

Three ways to protect yourself against employee claims

Royal Courts of Justice, London

Ultimately, no employer can prevent employees from attempting to bring employment related claims against them. However there are things you can do to protect yourself and put you in a strong position.

  • Firstly and most importantly, put yourself in the employees shoes and think about how you would want to be treated. If you follow that common sense rule you shouldn’t go too far wrong. For example, you are likely to investigate the situation thoroughly, listen to all sides including the employee before making a decision and not jump to conclusions.

Canny employers may draft a provision into the contract of employment enabling them to suspend an employee pending an investigation. This protects the business for example, a disgruntled employee cannot then contact customers or destroy computer evidence relevant to the investigation.

Secondly, follow a procedure.  For unfair dismissal purposes you have to show that not only did you have a good reason to dismiss (such as the person being incapable of doing their job or guilty of misconduct) but you have to show that you have acted fairly and reasonably in all the circumstances. The ACAS Code of Practice on Discipline and Grievance should be the  touchstone here as Employment Tribunals judge you by the standards set out in it and expect you to be familiar with it. It also contains handy flowcharts.

Thirdly, whilst employees are entitled to bring a companion along to a meeting in which they are dismissed (a colleague or trade union official) you may also want to take a witness along. This person could help you take notes of the meeting but is also there to protect you as they can confirm you acted fairly, if challenged.

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