Newsletter October 2019


Again it has been a quiet month in the world of employment law, but there’s always something of interest. This month I report cases ranging from ordinary unfair dismissal peculiarities to a couple of cases on religion and belief discrimination, which by their nature tend to hit the headlines due to the personal nature of the beliefs in question and the clashes arising from those beliefs.

Darryl Evans
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Relabelling the reason for dismissal

Logan v Future Technology Devices International Ltd (2019 CSIH 46) is notable partly due to its time frame - this Scottish Court of Session (equivalent to the English Court of Appeal) case stems from a dismissal which took place in April 2008!

The legal significance, however, is the restatement of the law that an Employment Tribunal may relabel the reason for a dismissal, even if the employer originally claimed a different category of reason.

Ms Logan was dismissed after she refused to work with a key contractor who was important to her employer’s success. That refusal led to a production stoppage which cost her employer around US$300,000. Ms Logan claimed that she had been dismissed for misconduct.

The Tribunal decided that there was fair reason but she had been unfairly dismissed on procedural grounds. However, it reduced her compensation by 85% on accepting her employer’s argument that they would have dismissed her fairly had they followed the correct procedure. They also reduced the award by a further 10% due to her contributory conduct. In making its decision, the Tribunal decided that the reason for dismissal was the catch-all category of “some other substantial reason”, rather than misconduct.

Ms Logan appealed against the reduction in her award. She said that the Tribunal had been incorrect to re-label her dismissal as it did, and this inhibited her right to a fair trial under Article 6 of the European Convention on Human Rights. She also argued that this went against the principles of natural justice.

The Court of Session found that in the circumstances the Tribunal had been entitled to take the approach that it did. This was not a case where there was a dispute over the facts which led to the dismissal. Both parties had referred to the potential relabelling of the reason for dismissal in their submissions and had the opportunity during the hearing to put forward arguments in respect the issue, so neither was prejudiced.

There are often circumstances in which it is hard to determine whether a case falls within one specific category of permissible reason under unfair dismissal law. What this case shows is the importance of being faithful to the facts which lead to dismissal, rather than manipulating them so that they sit more neatly within one of the permissible categories of reason. That said, if there are two circumstances which might justify dismissal it is important to recognise them as separate and not conflate them.

Pre-termination negotiations

Section 111A of the Employment Rights Act 1996 enables “pre-termination negotiations” to take place between an employer and employee to facilitate discussions aimed to bring about termination of employment by means of a settlement agreement. These negotiations, often referred to as “protected conversations”, are inadmissible in any later ordinary unfair dismissal proceedings. Crucially, though, they are admissible in automatic unfair dismissal cases (such as whistleblowing) and discrimination claims, or where there has been “improper behaviour”.

In Harrison v Aryman Limited (UKEAT/0085/19/JOJ) the company wrote to Ms Harrison proposing that her employment be terminated on the basis of a settlement agreement. However, she had recently informed her employer that she was pregnant. She believed that her employer was trying to end her employment because of her pregnancy, arguing in support that there was a history of detrimental treatment for pregnancy or maternity related reasons by that employer.

She resigned and brought claims for unfair constructive dismissal as well as sex and pregnancy and maternity discrimination. The employer tried to stop their settlement proposal letter from being adduced in evidence. Ms Harrison argued that the letter was not a genuine attempt to negotiate so s111A was not engaged at all. She also argued that the exemptions applied and that the writing of the letter was itself “improper behaviour”.

At a preliminary hearing the Employment Tribunal initially held that s111A was applicable in respect of the unfair dismissal claim but not the discrimination claims. Ms Harrison appealed, and the Employment Appeal Tribunal (EAT) held that the Employment Tribunal had not properly considered whether the exceptions to the protection rule under s111A applied, and so the case has been remitted to the Tribunal for reconsideration.

There is no decision on that yet, but the case is worth reporting as a reminder of the dangers around using s111A conversations. They are clearly most safely used in poor performance cases where there is little likelihood of the employee being able to make a discrimination or automatic unfair dismissal claim. However, the risk of the employee seeking to identify an ulterior motive – be it unlawful discrimination or whistleblowing – can never be entirely ruled out so I think it also makes sense that the content and tone of the offer is one which the employer is happy to stand behind if the contents of the conversation do end up being placed before the tribunal.

Religion and belief discrimination

Although this case was only decided at Employment Tribunal level, it highlights the tension between an individual’s religious beliefs and the rights of others – a clash of protected characteristics.

Dr Mackereth was a Christian who, as part of his religious beliefs, did not accept transgenderism. The DWP's policy is that transgender people should be addressed and referred to by their preferred pronoun and name, but Dr Mackereth refused to follow this policy, preferring instead to use the pronoun applicable to his patient’s birth gender, stating that this was necessary due to his religious beliefs. He was provided with diversity training and offered additional help and support, but he continued to refuse to follow the policy, and so was dismissed. He then brought claims of discrimination on the grounds of religion or belief.

The Employment Tribunal accepted that he held genuine religious beliefs, and that his right to hold those beliefs was protected under the Equality Act 2010. However, the right to manifest a religion or belief is subject to the protection of the rights and freedoms of others, and the manner in which he chose to manifest those beliefs, i.e. refusing to refer to a transgender person by their chosen pronoun, would itself constitute unlawful discrimination or harassment under the Equality Act 2010.

The Tribunal also held that any person who refused to follow the policy would have been treated in the same way as Dr Mackereth, whether or not they held Christian beliefs. Therefore, his dismissal was not because of his beliefs and therefore not discriminatory. He appears likely to appeal this decision. (Mackereth v The Department for Work and Pensions ET/1304602/2018.)

Religion and belief discrimination - again!

Ms Gray was dismissed for refusing to sign an agreement that would assign copyright over any works created during her employment to the employer. This is a perfectly regular requirement in a contract of employment, but Ms Gray was concerned that the agreement was too favourable to the employer and failed to protect her interests.

She was employed in January 2015 and was dismissed in September of that year and so had not achieved the two years’ service necessary to enable her to claim unfair dismissal. So she claimed that she had suffered discrimination on the ground of philosophical belief, relying on her passionate belief in the right of the individual to profit from and received credit for their own copyright works.

The Employment Tribunal found that her belief regarding the sanctity of her creative work was not sufficiently cohesive to constitute a philosophical belief under the Equality Act 2010.

However, it also found that the reason for her dismissal was her refusal to sign the agreement, rather than her philosophical belief, and so there was no discrimination. The Court of Appeal agreed with that, and rejected her appeal. Her beliefs about intellectual property were not the point. The dispute was over the wording of an agreement and that was not a matter of philosophical belief. Hence the Court of Appeal did not comment on whether belief in a right to benefit from intellectual property was a philosophical one because it did not have to. (Gray v Mulberry Company (Design) Ltd EWCA/Civ/2019/1720.)

Amending investigation report

It is often be the case that an investigation report compiled by an investigating manager will be reviewed by HR and sometimes by a legal adviser, who may advise some changes to the report.

This is what happened in Dronsfield v The University of Reading (UKEAT/0255/18). The employer’s in-house solicitor advised the removal of the investigator’s evaluative conclusions regarding Mr Dronsfield’s conduct. Those conclusions were helpful to the employee’s case.

The earlier drafts of the investigator’s report were disclosed during Employment Tribunal proceedings brought by Mr Dronsfield. The EAT concurred with the view of the Employment Tribunal that it was appropriate for the in-house solicitor to advise that the investigation report be restricted to factual findings and a conclusion as to whether there was a prima facie case to answer. It was then for the disciplinary panel to decide whether or not the conduct was sufficient to warrant dismissal.

The EAT found that the Tribunal had considered the overall fairness of the whole process followed by the employer, including the appeal stage, and had been entitled to find that the dismissal was fair.

Investigating managers should restrict their conclusions to the facts established by their investigation and whether or not there is a prima facie case to answer. Anything beyond that is irrelevant and often unhelpful.

Employer liability for third-party harassment

The EAT has held that an employer was not liable for an employee's racial harassment by a patient. Its failures to take adequate steps to prevent racial harassment in its workplace were not because of race.

As the law stands now, an employer will only be liable for the third-party harassment of an employee where the employer's action or inaction is because of the relevant protected characteristic. (Bessong v Pennine Care NHS Foundation Trust UKEAT/0247/18.)

Legal advice privilege – leaked email

Employers should be familiar with the idea that they can obtain advice from a solicitor on a tricky case without having to worry about what they ask or the advice they receive having to be disclosed in Tribunal proceedings – the concept of legal advice privilege.

This principle was tested in Curless v Shell International Ltd (2019 EWCA Civ 1710). A leaked email from a lawyer referred to the possibility of dismissing a client's employee by reason of redundancy, noting that a genuine redundancy exercise could be used as an "opportunity" to dismiss the employee in order to stop his continuing complaints about disability discrimination.

The Court of Appeal viewed the email as the type of advice employment lawyers give "day in, day out" in cases where an employer wishes to consider for redundancy an employee who is regarded as underperforming. The client was seeking advice on whether the employee might be either offered voluntary severance or dismissed on the grounds of redundancy in the course of an ongoing reorganisation. Advice was being given on how this could be done "with appropriate safeguards and in the right circumstances".

The Court did not support the EAT’s view this was advice to act in an underhand or iniquitous way by cloaking a discriminatory dismissal as a redundancy.

The case has become best known because the same advice was overheard, by remarkable coincidence, being referred to in a pub. That did not stop legal advice privilege applying although it is a reminder to advisers and clients alike to be careful about discussing cases in a public place.

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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