Employment Law Monthly Update – July 2019

Jul 4, 2019

We are pleased to provide you with the Herrington Carmichael LLP employment law update for July 2019.

This is a key note summary of some of the main developments in employment law in the last month.

  1. Holiday Pay: Long-Term Back pay Claims
    A Northern Ireland Court of Appeal ruling could lead to a further development in how much employees can claim in relation to holiday pay claims. Workers ordinarily have three months to bring a claim for an underpayment. Where there is a ‘series’ of underpayments, a worker may bring a claim within the last three months of the last underpayment in that series. The current position is that where there is a break of three months or more in the ‘series’, this limits how far back the employee can claim. The case of Chief Constable of Northern Ireland Police v Agnew considered whether a gap of more than three months in a ‘series’ of deductions should break that series. The Court of Appeal in Northern Ireland (the ‘NICA’) said it did not.

    In making their judgement, the NICA considered a number of issues including what is meant by a ‘series’ of deductions from wages relating to holiday pay and the meaning of ‘series’ in Employment Rights (Northern Ireland) Order 1996 (the ‘ERO’). The Claimant argued that previous case law was incorrect to decide a gap of more than 3 months between deductions broke a series and Lord Justice Stephens agreed stating that this could lead to ‘arbitrary and unfair results.’

This Judgment is not formally binding on tribunals in Great Britain. However, the wording of the ERO is identical to the equivalent law in the rest of Great Britain and therefore this case will provide persuasive authority on any future appeal. It is therefore important for employers to consider claims for an underpayment carefully and not simply assume that a payment may be out of time, simply because of a three month break.

  1. Disability Discrimination
    The case of Owen v AMEC Foster Wheeler Energy Ltd considered whether the withdrawal of an offer of an overseas posting due to health concerns amounted to disability discrimination. The Employment Appeal Tribunal (“EAT”) held it was not. 

On the facts, the Claimant was offered an opportunity to work in the UAE, subject to passing a medical assessment with an occupational health provider. The doctor raised concerns with the Claimant’s health. The offer of the assignment was withdrawn. The Claimant bought a claim for direct and indirect discrimination on the grounds of his disability. Both claims failed.

The Court of Appeal ruled that the requirement to pass a medical assessment amounted to a provision, criterion or practice (PCP) for the purposes of an indirect discrimination claim. However it was found to be a proportionate means of achieving a legitimate aim. The specific evidence adduced (e.g. the general health risks involved when flying to UAE) assisted with their judgment that the company’s decision was justified.

This case is an important reminder to employers to consider medical evidence carefully and to seek further clarification where they may be doubt. It also confirms the importance of looking at the reason why a decision is made (i.e. because of a disability or because of the increased medical attention the claimant would have needed).

  1. Reinstatement and Re-engagement
    The case of Mackenzie v The University of Cambridge considered whether an employee who had been unfairly dismissed could seek an injunction ordering re-engagement or reinstatement. The Court of Appeal held that the employee could not.

On the facts, the Claimant had been unfairly dismissed and the Employment Tribunal made an order for re-engagement. The University refused to re-engage the Claimant and, instead, offered to pay her the maximum amount of compensation instead. The Claimant sought a court order requiring the University to comply with the order of re-engagement. The Court of Appeal refused this request which was effectively seeking an injunction ordering compliance with the re-engagement.

Re-engagement is exclusive to the jurisdiction of Employment Tribunals. The only remedy for the employer’s failure to comply with an order for re-engagement was a liability on the employer to pay an additional award under the Employment Rights Act 1996. The Claimant could not force the re-engagement through the Courts. 

  1. Indirect Discrimination
    In the case of Heskett v Secretary of State for Justice, the EAT considered whether the ‘absence of financial means’ was sufficient to be considered a “legitimate interest” capable of justifying indirect age discrimination. The EAT held it was.

On the facts, the Secretary of State for Justice operated a policy which limited pay increases across the public sector, due to budgetary constraints imposed by the Government. The EAT concluded that the policy was objectively justified on the facts and was, therefore, not in breach of the Equality Act. The EAT distinguished this case to make it clear that this was not a ‘costs alone’ case. The Court said allocating resources in order to break even is capable of justifying indirect age discrimination.

It is important for employers to appreciate the distinction to be drawn between absences of means (i.e. an inability to make pay increases as a result of external factors) and seeking to rely solely on costs saving reasons.  The former may well justify indirect discrimination, the latter is less likely.

For further information, or to discuss the issues raised by this update, please contact Herrington Carmichael’s Employment Department on 0118 977 4045 or employment@herrington-carmichael.com.

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

 

 

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