Feast and famine. My last Newsletter covered two months and was shorter than most, so were we starting to think that the tide of employment law developments is receding? This month’s edition demonstrates that that is certainly not the case. Just as it is with running your own small business, a short lull in activity is abruptly reversed by an influx of new things to get your teeth into.
In addition, I promised to provide some information on how those responsible for HR and employment compliance in a business should be responding to the General Data Protection Regulation (GDPR) which will come into effect within six months. I have included in this edition a supplement with some key notes in this regard.
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Following the operation of the pilot, the ET fees refund scheme has opened to everybody. Applications can be made online or by post or email. If this is relevant to you (for example, you refunded the fees to a claimant as a result of a successful claim against you) and you wish to get the fees back, please contact me.
A question for the age – are those engaged in the gig economy workers or not?
Uber drivers are, according to the Employment Appeals Tribunal (EAT). It rejected Uber's argument that it was simply a technology platform acting as an agent for drivers by putting them in touch with passengers, rather than being a provider of taxi services.
The Employment Tribunal had, said the EAT, permissibly found the drivers to be workers for as long as they were in the territory in which they were authorised to work, were signed into the Uber app and were ready and willing to accept bookings. It noted that they were subject to a requirement that they should accept at least 80% of trip requests and would suffer a penalty if they cancelled a trip once accepted. Those matters were indicative of a worker relationship and inconsistent with the contractual documentation or a suggestion that drivers were in business on their own account.
The EAT said the fundamental question was: who were the drivers actually working for? The possibility of them working for the users was not ruled out; it was just that, on the facts, the Tribunal had (legitimately) decided that they worked for Uber.
Uber’s argument that the arrangements indicative of worker status were merely requirements of the regulatory framework for private hire licensing did not succeed. That framework did not require Uber to carry out the onboarding procedure it chose to operate.
Uber is said to be intending to appeal, possibly directly to the Supreme Court. (Uber BV and others v Aslam and others UKEAT/0056/17.)
But wait a minute. The Central Arbitration Committee (CAC) has decided that Deliveroo riders are not workers for the purposes of a union's application for compulsory recognition under Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act 1992. The "almost unfettered" right of substitution (i.e. to pass the delivery on to someone else) was fatal to the union's argument that the contracts were for personal service, said the CAC.
That right, it decided, was genuine even it was largely unnecessary for the rider (given that he/she could accept or decline a job, or in fact abandon an accepted one) and carried business risks for Deliveroo. There was evidence of the right having been exercised on occasions. Neither did it matter if the reason for including the substitution clause was to defeat arguments as to worker status. (Independent Workers Union of Great Britain v RooFoods Ltd (t/a Deliveroo) TUR1/985(2016).)
This whole debate is far from over, and these two cases illustrate the difficulty faced by lawmakers and the courts in establishing an easily understood framework for deciding employment status. As a result, the Chancellor announced in his budget speech that the government will publish a discussion paper as part of its response to the Taylor review of employment practices, aiming to clarify the tests for employee and worker status.
Rawlinson v Brightside Group Ltd (2017 UKEAT 0142/17) is a curious case, the practical significance of which may be quite limited, but the principle of which should make us all sit up straight.
Mr Rawlinson was an in-house lawyer at Brightside, a firm of insurance brokers. Not long into his employment Brightside decided to dismiss him for performance reasons, although it never raised these with him. To ‘soften the blow’, but also because it wanted him to work his notice period to handover his work effectively and challenges to his performance might interfere with that, Brightside told him that the legal services were being outsourced.
In fact, Mr Rawlinson resigned with immediate effect on the basis that that any outsourcing would constitute a transfer under TUPE and the company was therefore breaching its statutory obligations by ignoring TUPE. He then claimed wrongful constructive dismissal (based on a fundamental breach of the implied term of trust and confidence), automatic unfair dismissal because his dismissal was because of a TUPE transfer and compensation for failure to inform and consult under TUPE. Ordinary unfair dismissal was not available to him because of his short service.
The TUPE claims failed on the grounds that there was found to be no relevant transfer under TUPE. That just left Mr Rawlinson with his claim for constructive dismissal and the notice pay he lost by his summary resignation. In the Tribunal that claim failed too: there was no breach of the implied term of trust and confidence, because Brightside had no duty to tell him why he was dismissed so his argument was really about the manner of his dismissal, something for which contractual damages cannot be claimed.
The EAT overturned the decision. In all but the most unusual cases, it said, the implied term of trust and confidence must include an obligation not to mislead deliberately. That does not mean information (about reason for dismissal) has to be volunteered, but if it is that must be done in good faith. The implied term had been breached. The ‘manner of dismissal’ exclusion did not apply because this concerned the steps leading to dismissal, not the manner of dismissal itself.
Consequently, giving a misleading reason for dismissal could be constructive dismissal. The reason this this may be of rare practical significance is that in most cases the employee will actually be dismissed by the employer anyway, and hence be paid their notice pay, rather than resign themselves and claim constructive dismissal.
In Baker v Abellio London Ltd (UKEAT/0250/16) Mr Baker was a Jamaican national not subject to immigration control and known to have the right to live and work in the UK. Abellio carried out right to work checks and dismissed him when he did not provide sufficient documentary evidence. Abellio justified this on the basis that the reason was illegality (one of the five permissible reasons which can justify a fair dismissal). The Employment Tribunal found the dismissal to be fair.
The EAT disagreed. Properly conducted right to work checks excuse the employer from paying a penalty if it turns out that the employee did not have the right to work. However, not undertaking the check is not an offence in itself, so Mr Baker’s not providing the documents could not justify dismissal for illegality.
Dismissal could be justified for “some other substantial reason” (another of the five permissible reasons) if the employer had a genuine but erroneous belief that employment was illegal and the case was returned to the Tribunal for reconsideration on that basis.
Checking right to work status at the start of and during employment is important. However, if all boxes are not ticked, clarity of thought and rationale is needed to support any consequential action, particularly dismissal.
Where a decision is made by more than one responsible employee, a discriminatory motivation on the part of any of the decision-makers is sufficient to give rise to liability for the employer. That is the EAT’s guidance in Commissioner of Police of the Metropolis v Denby (UKEAT/0314/16).
Mr Denby was a (male) police officer who led a group about whom the (female) Deputy Assistant Commissioner (DAC) had concerns owing to a lack of gender diversity. She responded heavy-handedly to complaints about members of that group, whilst allowing similar complaints about another group, led by a female officer, to be investigated locally.
The Employment Tribunal found that the DAC influenced the decision by another officer to subject Mr Denby to a criminal investigation, that other officer being fully aware of the discriminatory context. The employer was therefore liable for sex discrimination.
Employers should not, said the EAT, be able to escape liability by deliberately opaque decision-making which masks the identity of the true discriminator. Indeed, where a claimant is, for good reason, unable to identify which individual within an employer is responsible for an act of discrimination, they may sometimes be permitted to amend their claim during the hearing once the correct person is identified from the evidence.
The European Court of Justice (ECJ) has been busy this month.
Let me first report its decision that a Spanish employer which failed to assess the workplace risks posed to a breastfeeding worker in accordance with the requirements of the Pregnant Workers Directive may have committed an act of direct sex discrimination. This conflicts with the exclusion in section 13(7) of the Equality Act 2010 which prevents a woman from bringing a claim for direct sex discrimination under UK law in these circumstances. UK law may therefore be wrong in this regard.
A general risk assessment of a worker's role, said the ECJ, may not be enough. Where a role poses a potential risk to a breastfeeding mother or her child for one of the reasons listed in Annex 1 to the Directive, the employer must assess her individual circumstances to determine whether there is a risk.
Technical legal stuff this may be, but it is a reminder to take the requirements to consider carefully the individual circumstances of each mother returning to work, including in relation to breastfeeding. (Ramos v Servicio Galego de Saude (C-531/15) EU: C:2017:789.)
Possibly, given the judgement of the ECJ in Esoterikon v Kalliri (C-409/16) EU:C:2017:767).
A minimum height requirement for the Greek police was, said the ECJ, indirect sex discrimination and could not be objectively justified. Although the Greek government had a legitimate aim of enabling the effective accomplishment of the various functions of the police force, the height requirement was not a proportionate means of achieving that aim. Not all police functions required physical aptitude and physical aptitude was not necessarily linked to height. Carrying out pre-selection physical aptitude tests could have been enough to ensure the demands of the role could be met.
My third ECJ case concerns the 24-hour weekly rest period provided by the Working Time Directive.
The question before the Court was whether that 24-hour break could be granted on any day in the seven-day reference period, allowing it to be on the first day of one week and the last day of the next? If so, a worker could be required to work up to 12 consecutive days, with days 1 and 14 in a two-week work cycle being the days off.
This is, said the ECJ, acceptable. Indeed, in the UK, where employers have the option to provide a 48-hour rest period (or, to be precise, the two 24-hour rest periods) in a 14-day reference period, this could mean that it would be permissible for a worker to work for 24 consecutive days (i.e. days 1, 2, 27 and 28 in a 28-day work cycle being the days off).
For employers operating standard five (or even six) day weekly work patterns this will be of no significance, but those operating shift systems may take note. (Maio Marques da Rosa v Varzim Sol – Turismo, Jogo e Animação SA (C-306/16) EU:C:2017:844.)
And now, in the words of Tom Waits, I would like to move on to some religious material. (That will likely mean nothing to any reader - it is just a moment of self-indulgence.)
An Employment Tribunal struck out a church minister's complaint of direct marriage discrimination when he was dismissed after he began to experience marital difficulties. The church leadership, concerned about the possible effect on his ministry, cited a breakdown in trust and confidence in justification of its decision.
The Tribunal distinguished marital difficulties from the status of marriage and said that the protected characteristic of marital status was not engaged. Er, no, said the EAT. The only reason the marriage difficulties were significant to the church was because there was a marriage in which there could be difficulties. The case was sent back to the Tribunal which should determine whether the status of marriage was the reason (either in whole or part) for less favourable treatment. Would someone suffering similar difficulties in a close relationship that is not marriage have been dismissed?
An unsurprising outcome I think, and a reminder that if you see the head of a pin it is usually a waste of time to dance on it. (Gould v Trustees of St John's Downshire Hill UKEAT/0115/17.)
An interesting facet of the ‘Gay Cake’ case which I reported last year was the clash of rights of two protected characteristics – sexual orientation and religious belief. (Indeed, arguably the case of Gould reported above touches on the same territory.)
A similar issue has arisen in reports I have seen of an Employment Tribunal decision to dismiss religious discrimination claims brought by a Christian non-executive director of an NHS Trust. He was removed from office after giving media interviews concerning his opposition to adoption by same-sex couples.
The Tribunal determined that he had not been removed because of his beliefs or his expression of them, but rather because he spoke repeatedly to the media without first informing the Trust, despite specific requests to do so, and in a manner which suggested he was unable or unwilling to distinguish between his personal views and what it was appropriate for someone in a high-profile position to say to the media.
The case raises questions about employers censoring the expression of religious or philosophical beliefs outside the workplace and is likely to be appealed, I hear, so I may be back to you on this one.
- The new requirements will come into effect in the UK on 25 May 2018
- They will represent fundamental changes to the UK's data protection laws
- Brexit will not affect the changes
- Penalties for breach will be much more severe: the maximum fine will increase from £500,000 to the higher of up to £10 million or 2% of gross annual turnover for minor infringements (e.g. record keeping failures) and up to £20 million or 4% of gross annual turnover for more serious infringements (e.g. a breach of GDPR principles)
- In addition, employees (as data subjects) will have the right to claim compensation for any damage suffered as a breach of GDPR
The GDPR affects all personal data held by an organisation, not just employee data. Compliance is therefore a business-wide project and the steps you take within your HR department need to co-ordinate with, and indeed form part of, that project.
Some key considerations
- You should no longer assume that employee consent alone will be a sufficient legal basis for the processing of data. Consent must be freely given, so it will not be adequate where there is a clear imbalance between the data subject and the data controller, as will likely be seen to be the case in an employee / employer situation. The widely-adopted approach of obtaining general data processing consent as part of the recruitment process is therefore likely to become a thing of the past. Detaching consents from employment contracts and making them more specific is likely to be necessary
- In fact, requesting and relying on consent may become a last resort or one limited to specific circumstances, rather than being the general basis for the legal processing of employee data. An employer should consider the grounds which justify the legal processing of employees' personal data, such as that it is `necessary' for the performance of the employment contract (e.g. to pay the employee), for the legitimate interests of the employer (e.g. administrative purposes, or to comply with a legal obligation
- This emphasises the need to consider what types of employee data is held and why; who has access to the data (and why); and how long the data is held for
- Privacy notices will need to be issued: employers will have to inform employees (and job applicants) how their personal data will be used. The privacy notices/ fair processing notices that employers may already use are likely to have to be beefed up and will have to be kept up-to-date, clear, and easily accessible
- Contracts which involve the transfer or other processing of personal data, such as those governing the outsourcing of HR services, will need to contain certain provisions, so these will need to be reviewed, with particular issues where data is transferred outside the EU
- Data subjects (including employees and job applicants) will have enhanced rights, including in the areas of subject access (including a tighter deadline within which an employer must respond to a subject access request), rectification of inaccurate or incomplete data, data deletion, objecting to certain types of processing (e.g. for direct marketing) and restrictions on further processing
- Individuals will be allowed to acquire personal data that they have provided to the employer in a structured, commonly used and machine-readable form, so as to enable the safe and secure transportation of data into a new IT environment
These requirements will require employers to have systems in place allowing personal data to be easily accessed and provided on request, with a clear understanding of the justification for processing and, if necessary, why the employer continues to hold personal data.
A review and updating of the data privacy and related policies in the employee handbook (such as home working, disciplinary, IT, monitoring and social media policies) will also be needed. As I say, however, this should not be done on an isolated or ‘off-the-shelf’ basis. These policy and procedure changes need to be consistent with and be part of the organisation’s more general data protection compliance policies and procedures.
Accountability and compliance
- Privacy must be considered from the outset of projects and before personal data is processed, not retrospectively
- Data controllers must be able to demonstrate how compliance is being achieved on a constant basis. Procedures for reviewing data privacy compliance will be necessary
- Data Protection Impact Assessments (DPIAs) will be mandatory in certain circumstances, such as where new technologies are deployed
- Any personal data breach must be reported to the Information Commissioner within 72 hours of it being identified. A response plan for such an occurrence, to ensure that the breach could be identified, reported internally, reviewed and reported in time, is recommended
There is clearly a lot to consider and possibly a great deal of work to be done over the next six months to be ready for GDPR. I strongly recommend you work with your relevant colleagues on a business-wide response to these changes and ensure your HR processes, documentation, policies and procedures are reviewed and updated so as to tie in with that response.