Employment Law Bulletin - 2010 Issue 13
23 Feb 2010
Issue 13
Welcome to the latest Blandy & Blandy Employment Law Bulletin
In this edition we look at:
Update of Key Recent Cases
Employment Law News
Legislative Developments
Recent Cases
“Get a haircut” – dress codes and discrimination: how far can an employer go?
Dansie v Metropolitan Police
Mr Dansie, a long-haired trainee police constable, has become the latest in a long line of Claimants to fail in bringing a successful sex discrimination claim based on appearance or dress codes. The case made it clear that requiring a male employee to cut his shoulder-length hair did not amount to discrimination or harassment under the Sex Discrimination Act simply because a female employee would not, in similar circumstances, have been required to cut her hair, provided that the overall Dress Code was equally balanced between the sexes. The EAT was satisfied that the Tribunal had been entitled to find, on the evidence, that a female recruit who failed to comply with the gender neutral dress/appearance code necessary for the service would have been treated in the same way.
The facts of the case were that, before starting training in 2008, Mr Dansie inquired whether his hair length would be acceptable and he was told that it would comply with the police dress code. When he reported for training, his shoulder length hair was slicked back on his head and tied in a bun. Having commenced the training programme, the employee was told to have his hair cut and he was threatened with disciplinary action if he did not comply. He claimed that he had been unlawfully discriminated against on grounds of his sex in that he had been less favourably treated and suffered detriment and/or harassment.
The tribunal rejected the claim and the decision was upheld by the EAT. The EAT made two key points:
1. That a difference in treatment between the sexes on one particular aspect of the Dress Code is not necessarily more favourable treatment of a member of one sex compared with a member of the other sex; and
2. In order to determine whether an employer treats members of one sex less favourably than the other it is necessary to consider the Dress Code as a whole, even though a single provision of the Code may upset the balance of treating the sexes equally. A code which applies a conventional standard of appearance is not in, and of itself, discriminatory; looking at the Code as a whole, neither sex must be treated less favourably as a result of its enforcement.
This case of confirms that the correct legal test is whether, applying contemporary standards and conventions, as well as the specific needs of the profession in question, the employers dress code as a whole requires an equivalent level of smartness between the sexes.
This is a common sense decision and should assist employers who have dress codes as part of their employee handbook. Employers may continue to use dress codes which include some gender-specific requirements provided that, as a whole, they are gender neutral and that enforcement will not result in one sex being treated less favourably than another. However, employers should take care when adopting a dress code and consider the adverse impact such a code could have on the workforce, in particular in relation to different ethnic or religious groups. Before implementing a policy, employers should question the purpose of the policy and consider what the implications are and whether there are any objective justifications for it.
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Health & safety: pregnant employees
The interrelationship between health and safety and maternity can be a difficult area for employers, but two recent cases are helpful in clarifying some of the issues. The first relates to whether there is always a need to carry out a risk assessment in respect of pregnant employees. The second looks at the issue of pay for a pregnant employee who has been re-deployed into a lower paid job on health and safety grounds.
i) Risk assessments
In the first case, O'Neill v Buckinghamshire County Council, the EAT ruled that the obligation to carry out a risk assessment in respect of pregnant workers is not a general one - it only arises in certain circumstances. Therefore failure to carry out an assessment will not automatically amount to sex discrimination under the Sex Discrimination Act 1997.
Ms O'Neill was a teacher with a turbulent relationship with her colleagues and employers at school. As a result, a number of complications occurred in the run-up to her maternity leave, which meant that no risk assessment was ever completed.
The failure to conduct the risk assessment was one of many issues about which Ms O'Neill complained to an employment tribunal, and she alleged that this failure amounted to pregnancy based sex discrimination. The tribunal rejected this claim, and did not agree with her assertion that Section 3A of the Sex Discrimination Act 1975 provided some form of "special protection" to pregnant workers. It held that the failure to carry out a risk assessment was not sex discrimination as such, since the Management of Health & Safety at Work Regulations 1999 (which give effect to the EU Pregnant Workers Directive 92/85) did not apply to Ms O'Neill's work, so that there no question of there being a failure to carry out a legally required risk assessment which could form the basis of a discrimination claim.
When Ms O'Neill appealed, the EAT largely agreed with the tribunal’s finding and confirmed that for an employer to fall under a duty to conduct a risk assessment for a pregnant worker, these preconditions must be met:
(a) the employee notifies the employer in writing that she is pregnant;
(b) the work is of a kind which could involve a risk of harm or danger to the health and safety of the expectant mother or her baby;
(c) the risk arises from either processes, working conditions or physical, chemical or biological agents in the workplace.
There is no more general obligation to carry out a risk assessment for a pregnant worker. In discharging its risk assessment obligations, where they arise, there is nothing to indicate that a meeting with the worker is required before the obligation to carry out a risk assessment is satisfied. However, an employer must provide the pregnant worker with comprehensive and relevant information on the identified risks to her health and safety.
The EAT also provides tentative support for the notion, first adopted by the EAT in previous case law, that if an obligation to carry out a risk assessment, and a failure to carry out that risk assessment is established, then discrimination results. Proof of detriment is not necessary. Employers, accordingly, need to be alive to carrying out risk assessments where the preconditions are met.
ii) Payments during pregnancy: health & safety
In the second case of Parviainen v Finnair Oyj (C-471/08), the Advocate General (‘AG’)has given his opinion recommending that the European Court of Justice hold that the EU Pregnant Workers Directive does not require an employer to pay a pregnant worker, who is temporarily transferred to a different job to prevent her being exposed to health risks, the average salary that she earned prior to the transfer. Under Article 11, the employer is required to provide her with an adequate allowance, which must be no less than a male or female worker is paid for doing an equivalent job.
Ms Parviainen was an air stewardess with Finnair. She became pregnant and was moved to work as ground staff, in order to comply with health and safety laws protecting mothers and their unborn babies. However, due to a collective agreement she was paid a basic salary and allowances for ground staff - meaning that she suffered about a third drop in the salary she previously received as cabin staff. Ms Parviainen complained that she was entitled to the salary she had before her temporary transfer and the matter was referred to the ECJ.
The AG recognised that Ms Parviainen's job exposed her and her unborn baby to health risks, and that accordingly Finnair was under a duty to temporarily transfer her as it had done. The key question was whether Article 11 of the Pregnant Workers Directive entitled her to the same salary as she had before, when it stated that 'the employment rights relating to the employment contract, including the maintenance of a payment to, and/or entitlement to an adequate allowance for [pregnant workers], must be ensured in accordance with national legislation and/or national practice'.
The AG's view is that the amount of the payment is a matter for individual member states, and furthermore the only requirement is that any such allowance or payment to the pregnant worker must be "adequate". To be "adequate" it must be at least equivalent to the payment made to a male or female worker doing that job, or who was transferred to do it due to health reasons. There was no requirement that she be entitled to receive the same salary as she was on before the transfer. There is an essential difference to be noted - allowances paid to the pregnant worker due to her status, seniority or professional qualifications must still be paid to her; however pay or allowances related to the terms and requirements of the actual job that she did do not have to be paid once she temporarily transfers to another job.
The ECJ will consider this case in due course, but is expected to follow the Advocate General’s opinion.
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Dismissed 42 year old banker successful in age discrimination claim
Beck v Canadian Imperial Bank of Commerce
Mr Beck was employed by Canadian Imperial Bank of Commerce as head of its derivatives marketing team. He was made redundant, along with a number of members of his team in May 2008 and brought claims alleging age and race discrimination. Specifically, he complained that, as a German, he was treated less favourably than the bank's Canadian employees.
The Tribunal held that the redundancy process was a "sham". Evidence showed that the bank had already drafted a plan to rebuild the business with new recruits and had already consulted with head hunters. More importantly, an internal memo revealed that part of the rebuilding plan was to find a new head for the team with a "younger, entrepreneurial profile". The burden was on the bank to explain the use of the word "younger" in the recruitment brief, and the tribunal did not accept the argument that it simply meant less experienced. On the basis of this evidence, the Tribunal therefore ruled that Mr Beck had been directly discriminated against on grounds of his age. Compensation is to be determined at a later date. The Tribunal dismissed Mr Beck's race claim for race discrimination as there was no evidence that bank favoured Canadian employees.
Although most age discrimination claims relate to younger employees or those approaching retirement age, this case is a reminder that protection from age discrimination is available to employees of all ages. Employers should ensure that any redundancy-related dismissals are actually due to a genuine redundancy. Employers must be able to provide evidence of the business closure, workplace closure or the decreased requirements of the business for the work carried out by the relevant employees and employers should also be careful when creating new internal documents as part of a redundancy process as these documents may be disclosable to a Tribunal. This is also a useful reminder to employers as to the types of wording which Tribunals may deem to be evidence of age discrimination. This is particularly relevant in recruitment. Employers should avoid reference to terms which may imply that a younger person is preferred such as "young", "dynamic", "youthful enthusiasm" etc.
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Disability – “long-term effect” and aggregating impairments
In terms of disability discrimination legislation, a person has a disability if he or she has a physical or mental impairment, which has a substantial and long-term adverse effect on his or her ability to carry out normal day-to-day activities. If the impairment has lasted, or is likely to last, 12 months, it is regarded as long-term.
In the case of Patel v Oldham Metropolitan Borough Council, the EAT held that in determining whether the effects of an impairment are long-term, the effect of an illness that is likely to develop or has developed from another illness forms part of the assessment of whether the effect of the original impairment is likely to last, or has lasted, at least 12 months.
In this case, the claimant’s back pain developed into secondary leg pain. The original Employment Tribunal held that the effect of these two impairments could not be aggregated in order to reach the conclusion that they were long term - i.e. that they had lasted, or would be likely to last, more than 12 months. The EAT dismissed this approach, and held that the effects could be aggregated, if one had developed as a result of the other.The EAT made it clear that it is a question of fact as to whether or not the impairments are related and the case has therefore gone back to the Employment Tribunal in order to determine this.
While it is clear from existing case law and the Guidance on the DDA that simultaneous impairments may be taken into account for the purposes of deciding what amounts to a substantial adverse effect, there is no guidance on how consecutive impairments should be dealt with for the purposes of determining duration. The absence of such guidance is itself perhaps significant and suggests that the approach adopted in Patel is controversial. It will be interesting to see if this case goes to appeal. In the meantime, this case has potentially wide implications, enabling claimants to aggregate periods of separate but related impairments of less than 12 months each.
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Notice provisions and holiday pay
In Lyons v Mitie Security Ltd the EAT has confirmed that leave not taken at the end of a leave year can be lost by workers provided that an employer has not operated the notice requirements for requesting annual leave in an unreasonable way so as to deny requests for leave.
On 6 March 2008, Mr Lyons (a security guard) requested payment for six unused days of holiday before the holiday year ended on the 31 March. When he discovered that he had not been paid for the holiday, he raised a grievance.
His employer, in response to the grievance, argued that he had not given the four week's notice required by his contract for annual leave. As the contract prohibited carry over and the company was unable to pay annual leave while he was still working, the company said that he would lose the holiday pay. Mr Lyons resigned and lodged claims, including one for unpaid holiday pay, which were subsequently rejected by the tribunal. Mr Lyons appealed.
The EAT considered that the central issue on appeal was whether the right to four weeks' paid leave under the Working Time Regulations 1998 was absolute, even if an employee failed to comply with contractual notice requirements or those set out in Regulation 13 of the Working Time Regulations (WTR) 1998, which govern leave requests.
In the EAT's opinion, the right to statutory leave was not absolute and the statutory conditions placed on annual leave requests in Regulation 15 of the WTR 1998 can be subject to contractual variation, as happened here. Therefore, the loss of unused annual leave at the end of the leave year could result where the notice mechanism is not correctly operated by the parties. However, the mechanism must not be operated in an unreasonable, arbitrary or capricious way by an employer to deny any lawfully requested holiday. As the tribunal had failed to properly consider whether the company had breached the contract in relation to annual leave, the case was remitted to a different tribunal for rehearing.
This case is helpful for employers as it confirms that it is primarily employees’ responsibility to manage their annual holiday entitlement. However, employers do have a duty to ensure they do not operate their holiday notice provisions in an unreasonable, arbitrary or capricious way, thereby preventing employees from taking holiday that has been lawfully requested. It is worth noting, however, that employers are within their rights to insist upon the correct notice, even if that means employees losing holiday entitlement at the end of a leave year.
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Employment Law News
New “Fit Notes” to be launched in April
The new “Fit Notes” being introduced by the Government are intended to replace the current handwritten Med3 “sick note" used by doctors with a new "fit note” (still named Med3). They will be available in paper or electronic format and will focus more on what the individual can do, rather than just their incapacity.
Under the new system:
- There will no longer be 'a fit for work' option
- The 'may be fit for some work' option will be replaced with 'you may be fit for work taking account of the following advice‘
- The statement will list common changes which could be made to an employee's work environment or job role to help facilitate a return to work
- The maximum duration a medical statement can be issued for will be reduced from 6 to 3 months during the first 6 months of a health condition
- If an employer is not able to facilitate a change or an adjustment, a revised statement is not necessary; the existing statement is evidence that an individual has a health condition preventing him or her carrying out the current role
- Specific guidance for individuals, employers and healthcare professionals will (apparently!) be available shortly.
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2012: Extra bank holiday on 5 June
The Government has announced the creation of a Diamond Jubilee weekend in 2012, by moving the late May bank holiday to Monday 4 June and adding an extra bank holiday on Tuesday 5 June, as part of the celebration of the Queen's Diamond Jubilee. The Government intends to work with the Scottish Government (since national holidays are a devolved matter) with a view to harmonising celebrations across the UK.
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Normal minimum pension age to rise on 6 April 2010
On 6 April 2010, the normal minimum pension age (the earliest age at which a member of a UK registered pension scheme can ordinarily draw their pension) will increase from 50 to 55. There will be two exceptions to this covering ill health pensions and those with protected pension ages. If employees are between 50 and 55 and already receiving pension payments, this change to the normal minimum pension age will not affect those payments.
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New rates of pay announced for Financial Year 2010-2011
The Government has announced the new rates for Statutory Maternity Pay, Statutory Adoption Pay, Maternity Allowance and Statutory Sick Pay for the next financial year:
1. Statutory Maternity Pay, Statutory Adoption Pay and Maternity Allowance will increase from £123.06 to £124.88 per week; and
2. Statutory Sick Pay will remain at £79.15 per week.
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Employment Tribunal Awards
For dismissals which take place after 1st February 2010, there will be new limits on some Employment Tribunal awards.
The new limits are:
• The limit on the compensatory award for unfair dismissal which, due to a reduction in the Retail Price Index, will decrease from £66,200 to £65,300; and
• The maximum amount of a week’s pay for the purposes of calculating statutory redundancy payments and the basic award in unfair dismissal claims, which will remain unchanged at £380. This follows an interim increase on 1st October last year
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Legislative Developments
Information Commissioner: fines for serious DPA breaches
The Government has published its response to the consultation launched by the Ministry of Justice in November 2009 on the level of maximum fines the Information Commissioner will be permitted to impose for serious breaches of the Data Protection Act 1998. It has also proposed legislation which will enable the Information Commissioner to impose financial penalties of up to £500,000 for such breaches. This is expected to come into force on 6 April 2010.
At the same time, the Information Commissioner's Office has published statutory guidance on the circumstances in which fines will be issued and how the level of fines will be decided.
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Additional paternity leave and pay: final draft regulations published
Following an eight-week consultation period that closed on 20 November 2009, the Government has now published six sets of draft regulations to facilitate the introduction of additional paternity leave and pay. These regulations will apply to parents of babies due on or after 3 April 2011 and for adoptive parents who are notified of having been matched with a child on or after that date. The regulations will, however, come into force on 6 April 2010.
The Government intends to put guidance on the new rights in place before 3 April 2011 to ensure that employers and employees are aware of the changes and have sufficient information about them.
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