In this month's newsletter two big decisions stand out (with not a great
deal else going on, elections aside).
The first concerns the 2013 amendments to the whistleblowing legislation,
which provided that a claimant now has to prove that their disclosure was
made 'in the public interest'.
The second takes full circle the debate about whether a single Woolworths
store was a separate 'establishment' for the purposes of collective
redundancy consultation. According to the European Court of Justice it was,
thus restoring the law to where it was understood to be before this case
caused such a tremor in the legal world.
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In 2013 the whistleblowing legislation was amended to state that an employee
was only protected if his or her qualifying disclosure was 'in the public
interest'. It did not, however, define what the public interest was.
In Chestertons v Nurmohamed (UKEAT/0335/14) the Employment Appeals Tribunal
(EAT) took a wide view. The whistleblower, a director in the Chesterton's
estate agency, alleged he has made a protected disclosure by complaining
that Chestertons was overstating the costs of its London office, resulting
in lower bonuses for him and around 100 other managers.
The EAT noted that the objective of the amendment to the legislation was to
prevent claimants from relying on a breach of their own contract of
employment by the employer as being the basis for a protected disclosure.
However, despite the fact that in this case the claimant was alleging such a
breach and that was his primary concern, he was also alleging breaches of
his colleagues' contracts. Those colleagues amounted to a section of the
public which brought it within the realm of 'public interest'. So even
though the disclosure in question related to a contractual dispute affecting
a group of staff, rather than the wider public, it could qualify as a public
interest disclosure. Because the whistleblower reasonably believed that the
disclosure was in the public interest (i.e. the interests of the group of
managers) he was protected.
As outlined in my introduction, the European Court has ruled that an
'establishment' is the entity to which the employees are assigned to carry
out their duties. That dids not equate to the legal employer - so the whole
of the employing company - but rather, in the situation of the closure of
Woolworths stores, to the individual store in which they worked.
So when looking at the numbers of employees to see whether an employer needs
to take part in collective consultation (necessary when contemplating 20 or
more redundancies in a period of 90 days), Woolworths was right to count
each store as a separate establishment. This meant that it did not need to
engage in collective consultation with staff who worked in a store with a
headcount of less than 20.
This case has caused consternation amongst advisers and clients making
multi-site redundancies at the same time. Order, as they say, has now been
Despite the fears of employers it is usually very difficult for an employee
to make a successful unfair constructive dismissal claim. One of the
several challenges for an employee is responding to the alleged breach of
contract quickly and not delaying and thereby 'affirming' the breach.
In Colomar Mari v Reuters Ltd (UKEAT/0539/13) the claimant took delay to
something of an extreme. She waited 18 months to resign after she alleged
breaches of her contract of employment by Reuters. As a result she was
found to have affirmed her contract of employment, despite her argument that
she was too ill to resign any sooner. This meant that she was unable to
rely on those alleged breaches as giving her a reason to resign and claim
unfair constructive dismissal.
The EAT took into account the fact that she was fit enough to enter into
significant email dialogue regarding her contractual entitlements, and also
to make extensive travel plans during her period of illness.
An Employment Tribunal has awarded £19,500 to a waitress working under a
zero-hours contract for injury to feelings as a result of being subjected to
The lady claimed that her line manager asked frequent questions about her
sex life and regularly touched her inappropriately. When she finally made a
complaint, the hotel carried out an entirely inadequate investigation and
took no disciplinary action against the line manager.
The Tribunal decided that harassment had taken place, and that the hotel
should be liable for it. The size of the award was because of the lady's
age (22), and her vulnerability (she had fragile mental health).
This case is a reminder that just because someone is a zero-hours worker,
they are still entitled not to suffer discrimination under the Equality Act.
The employer will be liable for any such discrimination unless it can
demonstrate that it had taken all reasonable steps to prevent it. (Southern
v Britannia Hotels Ltd and another ET/1800507/14.)
The Court of Appeal in Way v Spectrum Property Care Limited
UKEAT/0181/13) has held that a
warning given in bad faith cannot be relied upon when deciding whether or
not to dismiss an employee.
Mr Way had received a final written warning, which was taken into account by
the employer in its decision to dismiss him for unrelated misconduct. The
warning had been given because he had helped a friend obtain employment with
his employer, in breach of his employer's recruitment procedures. He also
sent a number of inappropriate emails. He alleged that the manager who gave
him the warning had also been involved in the recruitment process and had
given the warning in bad faith.
The Court of Appeal agreed and as a result determined that it should not be
used as the springboard from which the employer later dismissed the
Other cases regarding the extent to which tribunals should look at the
validity of earlier warnings have generally concluded that such warnings
should not be questioned in detail unless they are manifestly inappropriate.
Here the 'bad faith' element of the warning took it into the territory in
which the warning would need to be assessed.
Mr Olsen, a Dane, was an internationally mobile employee. The question for
the EAT was whether he had a sufficiently strong connection to the UK to
allow him to claim unfair dismissal under the Employment Rights Act 1996.
He was an employee of a Bermudian company and had chosen a contract governed
by Bermudian law over a contract under English law which would have required
his relocation to England. His contract stated that his base was
Switzerland, from where he managed around 100 employees internationally
including around 20 in the UK. He spent more of his working time in the UK
than any other country.
The EAT held that there was not a sufficiently strong connection to the UK.
It noted that he had purposely structured his working arrangements and the
amount of time he spent in the UK in order to avoid paying UK tax. (Olsen v
Gearbulk Services Ltd & Anor UKEAT/0345/14.)
The last piece of employment legislation before the election came in the
form of the Small Business Enterprise and Employment Bill, which received
Royal Assent on 26th March. Two measures are worth noting, although they
have not been brought into force yet:
- Employers with 250 or more employees will have to publish details
of their gender pay gap
- Exclusivity clauses in zero hours contracts will be banned
I will provide more details when these do become effective.