Newsletter August 2019


It may be the ‘silly season’ but the court and tribunal machinery grinds on. There have been a few developments on a variety of topics this month to distract us all from thinking back to our peaceful summer holiday breaks.

Darryl Evans
T: +44 (0)7771 725341

Agency workers

The Agency Workers Regulations 2010 entitle an agency worker to the same conditions of work as a counterpart permanent employee. The question for the Court of Appeal in the case of Kocur v Angard Staffing Solutions Limited (2019 EWCA Civ 1185) was whether this extended to an entitlement to be offered the same number of hours of work as those performed by a counterpart.

The Court of Appeal held that the purpose of the Regulations was to ensure the equal treatment of agency workers and permanent employees while at work, and in respect of rights arising from their work. However, that that did not extend to the amount of work which agency workers were entitled to be given.

The agency worker in question, whose working hours were less than those of their permanent counterparts, was therefore entitled to be paid at the same rate as the counterparts, but not to have their working hours increased.

Effect of illegal contract

In Okedina v Chikale (2019 EWCA Civ 1393), Ms Chikale was a Malawian national employed as a domestic servant on a wage rate well below the National Minimum Wage, but whose leave to remain in the UK had expired. She was summarily dismissed and when she claimed unfair dismissal and unlawful deduction from wages, her employer argued that the claims could not succeed as Ms Chikale was working illegally and therefore her contract of employment was illegal and unenforceable.

The Court of Appeal held that the purpose of the Immigration Asylum and Nationality Act 2006 was to impose penalties on those who employed people who did not have the right to work in the UK, rather than on those employees. As the Employment Tribunal had found that Ms Chikale had not knowingly participated in any illegality, there was no reason to deny her a remedy.

The courts clearly took a very dim view of Ms Chikale’s treatment, and decided that the employer was not entitled to escape punishment for its unlawful treatment of the employee by relying on their own failure to comply with the immigration rules.

Disability discrimination - employee with Asperger’s Syndrome

In the case of Meier v BT the Court of Appeal in Norther Ireland was asked to decide whether BT’s rejection of Mr Meier’s application for employment amounted to disability discrimination.

Mr Meier was dyslexic and dyspraxic and was diagnosed with Asperger’s syndrome. He had a high IQ and, with support, achieved a 2:1 degree in Computer Science, and applied to BT for a job under its graduate programme.

The recruitment process involved a number of stages including a Situational Strengths Test (SST), but his application was rejected at this stage because of his low score. Mr Meier argued that the SST was not an appropriate mechanism to test someone with Asperger's syndrome, and asked BT to make reasonable adjustments so that he could progress to the next stage where his skills could be properly tested. BT refused, ignoring advice it had sought from the designers of the test which said that BT should speak to Mr Meier to find out more about his condition in order to determine if adjustments could be made to the test itself. The advice concluded that BT may have to bypass the SST if no reasonable adjustments could be made.

BT argued that Mr Meier would not have got through its recruitment process even if it had ignored his test results because the other stages tested the same competencies as the SST and it expected him to fail these.

However, the Employment Tribunal accepted expert evidence from a clinical psychologist that the test put Mr Meier at a significant disadvantage when compared to other candidates without Asperger’s. It therefore held that it would have been reasonable for BT to disregard Mr Meier's scores in the SST and to assess him by other means in order to test whether he met the competencies the job required.

The employer appealed but the Court of Appeal held that the Tribunal was entitled to find that BT had failed to take any steps to consider reasonable adjustments. The only solace for the employer was the reduced award it had to pay because of the high chance that Mr Meier would not have got the job anyway.

This case demonstrates that employers must in certain cases consider alternative means of assessing applicants, or omitting stages of an assessment process.

Holiday entitlement - part year workers

Employers employing workers who work casual or irregular hours in many cases calculate the employee’s holiday pay as 12.07% of their earnings, which has the support of ACAS guidance. This is based on the premise that an employee’s holiday entitlement under the Working Time Regulations (WTR) of 5.6 weeks represents 12.07% of a working year of 46.4 weeks.

However, in the case of Brazel v The Harpur Trust (2019 EWCA Civ 1402) the Court of Appeal has held that Working Time Directive, from which the WTR are derived, did not require employers to pro-rate the leave entitlement of workers who work only part of the year to that of full-year workers, and that therefore words could not be read into the WTR to that effect.

In this case the claimant was a music teacher working variable hours only during term time, and she was paid monthly on the basis of an agreed hourly rate based on the hours worked in the previous month.

She argued that the calculation of her holiday pay should be based on the WTR’s reference to the ‘week’s pay’ calculation prescribed by S.224 of the Employment Rights Act 1996 for workers without normal working hours, which involved taking her average earnings over the preceding 12 weeks, would result in holiday pay of around 17.5 per cent of her earnings for the term.

Although the claimant lost her case at first instance, the Court of Appeal concluded that words should not be read into the WTR to the effect that the 12.07% principle should apply, as the WTR simply require the straightforward exercise of identifying a week’s pay in accordance with Ss.221–224 ERA and multiplying that figure by 5.6. Attempting to build in a pro-rating requirement or a system of accrual would not be an exercise in statutory construction - it would involve the substitution of an entirely different scheme.

IR35 changes

The government has introduced draft legislation to implement its much-publicised tightening up of the IR35 regime. With effect from 6th April 2020, the private sector will be brought into line with the public sector, the effect being that if an individual is working for an end-user client through a company, usually set up by that individual for the provision of their services (known as a Personal Services Company - PSC), then that end-user client will be obliged to determine whether or not IR35 applies to the arrangement in question.

The new rules will apply to all payments made to such contractors with effect from 6th April 2020, and so will apply to existing contractors as well as new ones.

Having decided whether or not IR35 applies, the end-user will then need to provide a “status determination statement” to both the company it contracts with and the individual worker. The statement must include the result of the determination and explain the reasons for that conclusion.

Liability to pay the tax will rest with the PSC, but if that company fails to pay the tax, then liability will transfer up the contractual chain and ultimately to the end-user client. End-users will not, though, be liable for giving an incorrect IR35 determination if they took reasonable care in making that determination.

As expected, “small” private sector end-users will be exempted from the new rules, meaning that the PSC will continue to be responsible for operating IR35 as per the present rules. An end-user will be “small” for these purposes where it satisfies two or more of the following: turnover of not more than £10.2 million, a balance sheet total of not more than £5.1 million and not more than 50 employees. However, for unincorporated businesses only the turnover test will apply.

The government has already provided the above tool to help companies establish whether individuals are subject to IR35 and, after some criticism of that tool, is committed to improving it before April 2020.

Use of material found on employee’s phone in misconduct case

In the case of Garamukanwa v United Kingdom (2019 6 WLUK 109), the European Court of Human Rights has ruled that there was no breach of Article 8 of the European Convention on Human Rights where an employer used material during a disciplinary hearing which had been found on an employee’s phone by the police during their investigations into allegations of harassment against him by a colleague.

Mr Garamukanwa, an employee of the NHS, was involved in a relationship with a colleague. When this ended, he subjected her to a campaign of stalking and harassment. The colleague complained to her manager and then to the police (although no charges were brought).

The police found material on Mr Garamukanwa’s phone which they handed to the employer giving evidence of the alleged harassment. As a result, he was dismissed for gross misconduct,

He brought various claims against his employer, including a claim that it had breached his right to privacy under Article 8 by examining matters relating to his private life and using that as evidence to justify his dismissal.

The Employment Tribunal and the Employment Appeal Tribunal (EAT) rejected his claims on the basis that he had no reasonable expectation of privacy in the circumstances of his case. The European Court of Human Rights, to which he appealed, also dismissed his claim. Mr Garamukanwa, by the time of his arrest, had been aware for a year that his colleague had raised concerns about his conduct. He could not, therefore, have reasonably expected that any materials linked to those allegations would remain private. In addition, he had not challenged the use of the material from his phone or other private communications during his disciplinary hearing and had even voluntarily provided the panel with further private communications.

Knowledge of disability

The EAT has determined in Q v L that an employer was not fixed with knowledge of its employee's disability as a result of the employee providing information to the employer's occupational health adviser.

The consent the employee gave for the processing of information by the OH adviser had been limited to forwarding an opinion concerning the employee’s fitness to work. An opinion prepared from information supplied, pointed out the EAT, is different from the information itself.

The information and any commentary contained in this newsletter are for general information purposes only and do not constitute legal or any other type of professional advice. Darryl Evans and Evans Employment Law Limited do not accept any and, to the extent permitted by law, exclude all, liability to any person for any loss which may arise from relying upon or otherwise using the information contained in this newsletter. If you have a particular query or issue you are strongly advised to obtain specific, personal advice and not to rely on the information or comments in this newsletter.

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