Latest Tribunal Decision in the “gig economy”

Latest Tribunal Decision in the “gig economy”

In the latest Tribunal case dealing with the long-running saga concerning employment status in the “gig economy”, the Leeds Employment Tribunal has ruled that a group of Hermes couriers are workers, rather than independent contractors.

The case was brought by a group of 65 couriers, assisted by the GMB union. However, it has been reported that the ruling is likely to affect 14,500 Hermes couriers who are all engaged on the same contract. The judgment follows similar high-profile cases against Uber, Addison Lee and others, where judges have also ruled that individuals engaged on similar contracts are “workers”, rather than self-employed consultants, thereby benefitting from basic employment rights such as holiday pay and national minimum wage.

Football and domestic violence

Football and domestic violence

While everyone in the country is rooting for a win in tonight’s World Cup semi-final, for some, a loss will mean more than the loss of a mid-week excuse to hit the pub. Recent statistics have shown that when England suffers a defeat, incidents of domestic violence increase by 38%. That means that the loss of a match can be life threatening to a victim of domestic abuse. In England and Wales, around 1.9 million adults aged 16-59 experienced domestic abuse in 2016/2017. It affects all ages, genders, and races and can occur outside of intimate relationships. Despite the common misconception, domestic abuse is not always physical and can be much more subtle in the form of emotional and financial abuse. No single sporting event or incident is an excuse for this kind of behaviour but it can be a trigger.

If you are experiencing domestic abuse then help is available. The court can make orders securing you and your children in your home and preventing the abuser from contacting you or coming near you and your home.

If you or anyone you know is suffering from domestic violence or abuse of any kind by a spouse, partner or other family member, please get in touch with one of our expert family lawyers at Slater Heelis LLP.

Extension of Effective Date of Termination

Extension of Effective Date of Termination

In the case of Lancaster and Duke Limited v Wileman, the Employment Appeal Tribunal (EAT) considered whether the effective date of termination (EDT) should be extended by the statutory minimum notice period for the purpose of calculating an employee’s length of continuous service, where an employer is entitled to dismiss summarily by reason of the employee’s conduct. The EAT concluded that the extension to the EDT by the statutory minimum notice period does not apply in these circumstances.

In this case, the Claimant, Ms Wileman, began her employment with the Respondent on 22 September 2014. On 20 September 2016, the Respondent dismissed Ms Wileman summarily for gross misconduct. Ms Wileman presented a claim of unfair dismissal and the Employment Tribunal were tasked with deciding, as a preliminary issue, whether she had accrued the necessary continuity of employment i.e. 2 years, to bring a claim for unfair dismissal.

The relevant legislation provides that where an employer dismisses an employee with less than the statutory minimum notice period, the EDT is extended and is deemed to be the date on which the statutory notice would have expired. In this case, the Employment Tribunal decided that the EDT was 20 September 2016 and, extending this by Ms Wileman’s entitlement to 1 week’s statutory notice, her notice period would have expired on 27 September 2016, meaning that she would have accrued over 2 years’ continuity of employment and was therefore entitled to bring a claim of unfair dismissal in the Employment Tribunal.

The EAT disagreed. It alluded to cases where the point had been addressed previously. In the EAT’s view, there is no extension in cases of gross misconduct. The EAT noted however that in this case, the Employment Tribunal had not specifically made a finding as to whether or not Ms Wileman was guilty of gross misconduct. It was therefore not possible to apply the legal principle that the EDT would not be extended by the statutory minimum notice period in cases of gross misconduct. The issue was therefore remitted to the Tribunal to make a finding on this point.

New report warns of looming incapacity crisis

New report warns of looming incapacity crisis

A new report from SFE (Solicitors for the Elderly) and independent think tank, Centre for Future Studies, reveals the UK is leaving medical and care preferences to chance. The report looks at the ever-increasing number of people living with dementia which, combined with the failure to plan ahead for mental incapacity, exposes a looming crisis.

To read the report please click here SFE whitepaper

Contractor insolvency – an Employer’s viewpoint

Contractor insolvency – an Employer’s viewpoint

The construction industry depends on regular cash flow and the financial disaster of contractor insolvency can derail an entire construction project. Here we consider the measures an employer may take to protect itself from a contractor becoming insolvent during or at the end of a construction project.

  1. Due Diligence

Regardless of whether there is an existing commercial relationship with the contractor or it is the first time the contractor has been engaged, an employer should always carry out due diligence against the contractor before undertaking a construction project.

To reduce risk, it is vital to understand an organisation’s financial status before they are appointed and throughout the project. This can be done in a number of ways including credit checks; considering the filed accounts at Companies House; requesting performance references following recently completed projects and awareness of any joint ventures or partnerships between the contractor and other companies.

  1. Payment

The prudent employer knows and monitors how much has been paid to the contractor and whether they have been overpaid or underpaid.

Is the contractor paying his subcontractors and suppliers their due entitlement on time? It is not always easy to know for sure but the site rumour mill should not be ignored. Progress in accordance with the programme, or lack of it, is another indicator of the health of the contractor, as is the adequacy of the level of resources employed. If this all sounds rather obvious it is surprising how often such warning signs are present but ignored.

Any over payment should be promptly recovered by deduction or action having regard always to the contract terms and the payment provisions of the Housing Grants, Construction and Regeneration Act 1996 (as amended).

  1. Performance security

Most employers will require performance security from the contractor. One of the most common forms of security is the parent company guarantee, where the performance of a contractor is guaranteed by its parent or another group company. Naturally, the guarantee is only as good as the company giving it. If the contractor is in financial difficulty, the same could be true for the whole group. It may be possible to obtain a personal guarantee from a director or directors, though this is unusual and the financial strength of such a guarantee may be difficult to judge despite enquiries.

Alternatively, an employer could ask for a performance bond from an insurer or bank. It is necessary to ensure that the definition of the ‘default’ or ‘event’ under the bond triggering the right to call for payment includes contractor insolvency and that the term ‘insolvency’ itself is defined to fit in with the term as used in the building contract. The cost of a bond is usually added to or allowed for (transparently or otherwise) in the contractor’s price but it could prove to be a worthwhile investment, if it comes to finding another contractor to complete the project. Note also the commentary on termination for insolvency (see below).

  1. Retention

Retention is a contractual practice intended to provide security against defective work or insolvency and incentivise contractors to complete the works on time. It usually involves the employer withholding a percentage (typically 3 – 5%) of the amount due for payment. Ordinarily, the first half of retention is released upon completion of the work or the employer’s taking over of possession of the work (whichever is earlier) and the other half is released following the expiry of an agreed defects liability period (typically 12 to 24 months).  Employers should therefore consider the amount of the retention and the period for its release to help protect from non-performance. A higher percentage of retention is an incentive for contractors to complete works timeously and see the project through to the end. It means if the project is not completed, that money remains with the employer and may be available to go towards the additional costs of completion of the project.

  1. Warranties

The contractor should be required to procure warranties in favour of the employer from key subcontractors and members of the contractor’s professional team. See further under Defects (next).

  1. Defects.

If the right to compel the contractor to repair defective work is lost due to insolvency, the employer may have rights against the professional team (for design defects or negligent certification) or sub-contractors involved in carrying out the defective work.

Protection for patent or future or latent defects in the works can be found against those who have given collateral warranties. Provision for which should be made in the building contract.

If contractor insolvency occurs during the course of the works, the employer may benefit from having “step-in” rights allowing the employer to step in to the shoes of the contractor in the relevant appointment or Subcontract. Such step in rights will also provide for any outstanding liabilities and whether these are to be met by the employer. If so the employer will need to consider if the benefit of stepping in outweighs the outstanding liabilities.

  1. Termination

Where works are ongoing, it may be appropriate or necessary to terminate the contractor’s employment under the building contract for contractor default. Termination may then give rise to rights under a performance guarantee or bond. In the case of insolvency, the building contract may provide that termination happens only upon the giving of notice, or without notice (so called automatic termination). The legal effects of the different provisions is beyond the scope of this article. However it is important to consider the particular termination provisions and the process for carrying out termination, including the need for notice and when and how it needs to be given.

It is also prudent to consider whether to amend the termination provisions to widen the definition of insolvency. As stated above, the employer should consider how ‘insolvency’ is described in the contract and in any security documents or warranties giving step in rights.

Slater Heelis’ Construction, Engineering and Projects Team has extensive experience advising employers looking to manage risk on construction projects.

Please contact us on 0161 672 1255 or get in touch with our Construction & Engineering team.

Civil partnerships for heterosexual couples

Civil partnerships for heterosexual couples

A heterosexual couple have recently won a landmark legal right to enter into a civil partnership as an alternative to getting married.

Civil partnerships were introduced in 2005 in order to provide same-sex couples with the same legal protection and security that a marriage provides for heterosexual couples. However, in March 2014, same-sex couples were given the right to choose between entering into a civil partnership or marriage. This has led to campaigners arguing that heterosexual couples should have the reciprocal right to enter into civil partnerships.

Why enter into a civil partnership?

Some people believe that marriage has religious connotations and therefore feel uncomfortable with the notion of entering into a marriage. A civil partnership would allow for a heterosexual couple to obtain the legal protections of a marriage without having to compromise their beliefs.

What are the legal ramifications?

For both same-sex and heterosexual couples, equality in law was achieved when the Civil Partnership Act was introduced in 2005 and both types of union hold the same essential benefits and protections.  Therefore, following today’s Supreme Court ruling, there will be no advantages or disadvantages for  heterosexual couples in deciding  to enter into civil partnership rather than a marriage.

Latest Case on the “Gig Economy”

Latest Case on the “Gig Economy”

In the latest case in the gig economy, the Supreme Court has ruled that a heating engineer, working for Pimlico Plumbers, was a worker and not self-employed.

Mr Gary Smith worked for Pimlico Plumbers as a plumber and heating engineer. He was dismissed after 6 years. Pimlico argued that Mr Smith was self-employed and therefore did not benefit from any employment rights.

The question of employment status in Mr Smith’s case reached the Supreme Court, which unanimously ruled that Mr Smith was a worker and not self-employed. He was therefore entitled to rights associated with workers status, for example sick pay and holiday pay.

In examining the reality of Mr Smith’s relationship with Pimlico, the Supreme Court noted that Mr Smith’s contract did provide him with elements of independence commensurate with self-employed status. However, his services to Pimlico’s customers were marketed through the Company, Pimlico exercised tight administrative controls over Mr Smith during his periods of work, imposed stringent conditions regarding payment to him and restricted his ability to compete post-termination of the relationship. The Court considered that although some aspects of Mr Smith’s terms and conditions resembled self-employment, on balance, he was not a truly independent contractor.  He wore a branded uniform, had a tracker in his branded van and carried an identity card.

The Supreme Court’s ruling has wide reaching implications for thousands of workers like Mr Smith who could now find themselves with benefits like sick pay and holiday pay, which are associated with worker status.

Employees feel employers prioritise Company performance over their health and wellbeing

Employees feel employers prioritise Company performance over their health and wellbeing

Driven by a culture of heavy workloads, millions of UK workers have gone to work when they were ill instead of taking the day off, according to a report published by insurance company Aviva.

The report shows that around 7 out of 10 employees in private organisations – the equivalent of 11 million nationally – have at some point come into the office despite feeling unwell. More than 2 in 5 of 2000 employees surveyed said that they felt that their employer prioritises the performance of the Company over the workforce’s health and wellbeing. More than 40% of those surveyed said that they were afraid work would pile up when they were away.

It is reported that last year, the number of sick days taken annually by British employees fell to its lowest ever level since records began almost 25 years ago. Workers in 2016 took an average of just 4.23 days off work because of illness, down from 7.2 in 1993. In total, around 137 million working days were lost from injuries and illnesses in 2016, which is down from a peak of 185 million working days lost in 1999.

Discrimination arising from Disability

Discrimination arising from Disability

Section 15 of the Equality Act 2010 (EqA) confirms that if a person is treated unfavourably because of something arising in consequence of their disability and it cannot be shown that the treatment is a proportionate means of achieving a legitimate aim then this will amount to discrimination arising from disabilityE+W+SThis section has no associated Explanatory Notes

The Court of Appeal in the case of City of York Council v Grosset considered whether a dismissal could amount to unfavourable treatment under section 15 of EqA, even if the employer did not know that the disability was connected to the misconduct.

This case concerned a teacher, Mr Grosset, who suffered from cystic fibrosis and who was also stressed by his workload, which had increased with the arrival of a new head teacher.  Prior to this, there had been several reasonable adjustments put in place for Mr Grosset although these were not properly recorded.  While suffering from stress due to his increased workload, Mr Grosset showed an 18-rated film to vulnerable adolescents.  He asserted that the decision to show the film was an error of judgment arising from the stress he was under which was linked to his disability. However, he was dismissed for gross misconduct as a result of his actions.

He brought a claim in the Employment Tribunal for unfair dismissal and discrimination on the grounds of his disability.  The Employer resisted the claim on the basis that it had no knowledge that the misconduct was related to his disability and therefore the unfavourable treatment had no link to his disability and did not amount to discrimination.

The Employment Tribunal dismissed the claim of unfair dismissal but upheld the S.15 EqA disability discrimination claim on the basis that, although the school was unaware that Mr Grosset’s misconduct was linked to his disability at the time it decided to dismiss, medical evidence that had not been available to the school confirmed that there was such a link and that satisfied the causative test set down in S.15 EqA.   As for objective justification, the tribunal accepted that the school had legitimate aims in terms of safeguarding children and maintaining disciplinary standards but held that it had not demonstrated that dismissal was a proportionate means of achieving those aims.

The Council appealed unsuccessfully against the S.15 EqA claim. The EAT rejected the appeal and held that S.15 does not require an Employment Tribunal to ask itself whether the employer actually knew that the ‘something’ which caused it to treat the claimant unfavourably arose in consequence of his or her disability. The only knowledge requirement for a claim under S.15 is that the employer have actual or constructive knowledge of the fact that the claimant is disabled. The Council appealed further to the Court of Appeal.

The Court of Appeal held there was no inconsistency between the rejection of the unfair dismissal claim and the upholding of the S.15 claim. The test regarding unfair dismissal is about the band of reasonable responses and allows the Respondent extensive leeway. By contrast S.15 EqA is an objective test which allows a Tribunal to make its own assessment. As to justification the Employment Tribunal was entitled to find that dismissal was a disproportionate response.

Dismissal is plainly an act of unfavourable treatment. Provided that a Claimant can show a causal connection between unfavourable treatment and disability, then the causal link between the ‘something arising in consequence of their disability’ and the unfavourable treatment for the purpose of S.15 is an objective matter that does not depend on the employer’s knowledge.  As such, this will amount to discrimination arising in consequence of disability.

Dress Codes and Sex Discrimination

Dress Codes and Sex Discrimination

On 17 May 2018, the Government Equalities Offices published new guidance on Dress Codes and Sex Discrimination.  The guidance is aimed at employers who have dress codes and follows a slew of dress-code related sex discrimination cases in the Employment Tribunal.   The guidance will be particularly useful to workplaces such as offices, hotels, airlines, temporary work agencies, corporate services, the retail sector and in the hospitality industry, especially in bars, restaurants and clubs.

The guidance was written following a recommendation from the Parliamentary Women and Equalities Select Committee and the Petitions Committee and sets out how the law might apply in cases of sex discrimination where an employer requires female staff to wear, for instance, high heels, make-up, hair of a particular length or style, or revealing clothing.

The guidance defines a workplace dress code as a set of standards that employers develop about what is appropriate for employees to wear to work and confirms that dress codes can be a legitimate part of an employer’s terms and conditions of employment.

It confirms to employers that; –

  • dress codes for men and women do not have to be identical, but standards imposed should be equivalent
  • requiring any gender-specific items, such as high heels, make up or have manicured nails, is likely to be unlawful
  • dress codes must not be a source of harassment by colleagues or customers, for example women being expected to dress in a provocative manner

It also confirms that; –

  • when setting a dress code, employers should have regard to any health and safety implications. For example, if an employer requires staff to wear particular shoes (as part of a dress code rather than for personal protective equipment purposes), then they should consider whether this may make staff more prone to slips and trips or injuries to the feet
  • where someone meets the definition of a disabled person in the Equality Act 2010, employers are required to make reasonable adjustments to any elements of the job which place a disabled person at a substantial disadvantage compared to non-disabled people, including non-enforcement of a dress code which is more onerous on a disabled employee
  • transgender employees should be allowed to follow the organisation’s dress code in a way which they feel matches their gender identity and if there is a staff uniform, they should be supplied with an option which suits them
  • employers should be flexible and not set dress codes which prohibit religious symbols that do not interfere with an employee’s work

The guidance reminds employers that consulting employees and trade unions over any proposed dress code or changes to an existing code will help ensure that the code is acceptable to both the organisation and its staff.