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Inform: Employment
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Welcome to this month's Inform: Employment
This month's cases and legal developments have focused on an extension of maternity rights and widening the scope for part-time worker protection. One unexpected extension to maternity rights in the Sex Discrimination Act 1975 (Amendment) Regulations 2008, which came into force on 6 April 2008, relates to protecting provision of non-paid benefits during additional maternity leave. See further below.
Several recent cases (not reported below) have also highlighted the confusing inconsistencies between the various strands of our domestic discrimination legislation, even down to the detail of which procedure an Employment Tribunal should follow for determining the shifting burden of proof in race cases. The much awaited Single Equality Bill is long overdue and will need to do more than simply bring all the discrimination legislation together. A consistent approach to all aspects of discrimination is necessary.
Alan Julyan
Head of Employment
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Extension of maternity benefits from 5 October 2008... There is now no distinction to be drawn between the provision of non-paid benefits during ordinary maternity leave and additional maternity leave. In practice, this means that benefits such as provision of a company car, gym membership and insurances should be continued throughout the whole of the maternity leave period. Most importantly though, there should now be no distinction between accrual of contractual annual leave throughout the maternity leave period. Previously a distinction could be drawn and only statutory annual leave would accrue during the additional maternity leave period. This is no longer the case. Other benefits which rely on accrual of seniority or length of service will also be affected. An employer should therefore count an employee's additional maternity leave period toward their accrued length of service.
These rights will apply to all employees whose expected week of childbirth is on or after 5th October 2008. Employers are advised to amend their staff handbooks or maternity policies now.
The Amendment Regulations made the expected changes to the provisions on discrimination on grounds of pregnancy and maternity leave and the definition of harassment following the successful challenge by the EOC against the UK Government's implementation of the Equal Treatment Directive.
Extending ability to claim part-time worker discrimination...
Part-time workers should now find it easier to bring their claims. The EAT has set aside its decision in Gibson and Scottish Ambulance in the recent case of Sharma & Others v. Manchester City Council in this regard. Previously, in order to succeed with a claim of part-time worker discrimination, the part-time working had to be the "sole reason" for the less favourable treatment. This is no longer the case.
The Council in Sharma claimed that the fact that the employees worked part-time was not the "sole reason" for the dismissal because not all of its part-timers had been treated the same. The Council had three different categories of part-time workers. The EAT found that the treatment was less favourable on grounds of their part-time status and was not objectively justifiable. This decision effectively extends the remit for claiming part-time working discrimination.
The lucky employer ...
The case of RDF Media v Clements in the High Court has a lesson for all employers not to over-react or make derogatory statements about an individual whilst still employed, even if the employer believes the individual has acted in breach of contract. In this case the employee, who was also a director, accepted a job offer with a competitor and in handing in his notice sought to obtain an early release from his contract. The employer was aware that the employee intended to join a competitor and was affronted by the employee's attempt to do so as by joining a competitor the employee would breach restrictive covenants contained in his contract of employment and a share purchase agreement to which he was a party. The employer made derogatory statements about him, which were subsequently published. The employee sought to claim constructive unfair dismissal based on these statements in order to release himself from his contractual restrictive covenants.
Fortunately for the employer, the employee had already breached confidentiality obligations that he owed to the employer when he interviewed with the competitor. As a result, he could not rely on the subsequent breach by the employer as releasing him from the contractual restrictions. The employer was therefore lucky. We would advise more caution on an employer before potentially risking losing the benefit of restrictive covenants in this way. It will not always be obvious that the employee in those circumstances had breached confidentiality as there is no breach simply by interviewing with a competitor while still employed.
The over-hasty employer...
An employer's failure to consider ill-health retirement when dismissing an employee, of long-term sick, for health reasons was unfair. In the case of First West Yorkshire Limited (First Leeds) v Haigh, the EAT criticised First Leeds for its desire to avoid the costs of ill-health retirement. The case very much turns on its facts. It is also a reminder that an employer cannot dismiss if in doing so would deprive an employee of benefit under a PHI scheme unless it expressly reserves the right to do so (Aspden v. Webbs Poultry & Meat Group (Holdings) Limited).
In this case, First Leeds had decided to dismiss an employee on long-term sick without waiting for a final medical report from a consultant, as recommended by the employer's own occupational health advisor. Without the specialist's report, the occupational health adviser could not determine whether or not the individual would be "permanently disabled" and therefore entitled to benefit under the PHI scheme. Ironically, when the report came through from the specialist (post dismissal and post commencement of litigation), the specialist concluded that the employee was not permanently disabled. Nevertheless, the employee succeeded in claiming unfair dismissal.
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Protection for women undergoing IVF... Prior to an ECJ ruling in Mayr v. Backerei und Konditorei Gerhard Flŏckner OHG, there was no tangible protection for female employees taking time off for IVF treatment in the same way as they would be entitled to protection if they were pregnant and needed time off to attend ante-natal appointments.
IVF is a relatively recent issue for Courts and employers. The Equal Treatment Directive and the Sex Discrimination Act 1975 (SDA) when drafted contemplated an employee pregnant in the traditional sense rather than an assisted pregnancy through IVF. Mayr sought to claim protection as a pregnant employee on the basis that her eggs had been fertilised even though they had not yet been implanted in her womb. The question of when she was deemed pregnant fell to be determined. The ECJ, rather sensibly, concluded that a woman would not be deemed pregnant until the eggs were implanted even if they had been fertilised as many member states allowed storage of frozen fertilised eggs for many years. It would have been unfair to afford women storing eggs in such a manner protection as a "pregnant employee", potentially for years.
The more tricky question was whether a dismissal "relating to an employee's IVF treatment" amounted to sex discrimination. This seems rather obvious, but prior to Mayr it could not be said that this was the case. Previous cases have centred on whether there was an obligation on an employer to allow women reasonable time off (paid or unpaid) to undergo IVF or to recover from it. The ECJ confirmed in Mayr that dismissals or less favourable treatment of a female employee because she has undergone or is undergoing IVF treatment would amount to direct discrimination. As only women can undergo IVF treatment, it is appropriate to draw an analogy between them and pregnant women since both conditions can only affect women. Employers should therefore give serious consideration before taking action against a female employee who has undergone (or is undergoing) IVF which might otherwise be considered less favourable treatment.
Dismissal in breach of SDP automatically unfair...
In the case of Davies v Farnborough College of Technology the EAT held that a failure to comply with the statutory dismissal procedure (SDP) rendered a dismissal automatically unfair. In ordinary unfair dismissal cases a procedural error can be made good on an appeal. That does not apply, however, to dismissals which are automatically unfair for breach of the SDP. Davies, who had been made redundant, was not so lucky with compensation despite being unfairly dismissed. The EAT accepted that even if the procedure had been complied with, he still would have been selected for redundancy. Following Polkey, the compensatory award was reduced to nil. Incorrectly, in our opinion, the EAT went on however to uplift the basic award by 25% as a penalty for the employer's failure to comply with the SDP. In our view, the penalty for failing to comply with the SDP should only affect a compensatory award and not a basic award. This element of the case may well be appealed on an error of law.
Narrow interpretation of paternity leave rights...
The EAT has given a narrow interpretation to the rights of protection afforded to an employee on paternity leave. In Atkins v Coyle Personnel Plc, an employee with less than one year's service was dismissed following a heated argument with his boss whilst on paternity leave. As the employee did not have sufficient service to claim unfair dismissal, he sought to claim protection under the Paternity and Adoption Leave Regulations 2002. The Regulations provide that a dismissal "connected with" paternity leave would be automatically unfair thereby getting round the one year's service requirement.
The EAT held that a dismissal in these circumstances must be "causally connected" and not just "associated" with the paternity leave. The facts of the case suggest that although the heated argument did give grounds for dismissal, if the employee hadn't been on paternity leave at the time, he wouldn't have had the heated debate. This was held not to have been enough to bring him within the statutory protection. Unfortunately, paternity leave cases are few and far between and it is unlikely that there will be a change to this interpretation in the near future.
If you require further information on any of the above topics, please contact Emma Bartlett.
If you would like to comment on any of these topics, please click here.
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