Following procedure

Much has happened since the last update (see SJ 158/37). On 1 December 2014, shared parental leave and pay became available to parents where a baby is born on or after 5 April 2015. Unison’s legal challenges to the introduction of tribunal fees, due to the alleged adverse effect on potential claimants, continue.

On 4 March 2015, the Advisory, Conciliation and Arbitration Service (ACAS) published a report on early conciliation, which confirmed that, between April and September 2014, 8,810 (23 per cent) disputes where ACAS had been notified had progressed to an employment tribunal (ET) claim, but by the end of January 2015 a further 2,530 of those had been settled. The report also stated that between September and December 2014 notifications increased further ‘to around 1,800 per week’.

In this update, we cover cases concerning procedure – costs and leave to amend a claim, affirmation of a contract, disability discrimination, and the extension of the meaning of ‘worker’ for the purposes of ‘whistleblowing’.

Recovery of costs

It is not uncommon for a party (claimant or respondent) to have its fees and/or costs covered and paid for by a third party (insurance companies, consultants, unions, etc.). In some cases, a party pays the issue and hearing fees, for example, and then recovers the said sums from a third party.

However, what is the position where a third party pays the said sums ‘directly’ on behalf of a party, and the party seeks to recover those costs from the other party (or parties) to the action? This question was addressed by the Employment Appeal Tribunal (EAT) on the papers in Goldwater and others v Sellafield Ltd UKEAT/0178/14/DXA. In this case, following a successful appeal in the EAT, the appellants sought to recover the costs of the issue and hearing fees, which were paid on their behalf by their union, under rule 34A(2A) of the EAT rules.

In the event that the EAT allows an appeal, it has a discretion to decide whether or not to make a costs order against a respondent. However, the amount specified to be paid to the appellant under the rule is ‘an amount no greater than any fee paid by the appellant’. Therefore, the EAT held that ‘the plain fact is the [appellants] have paid no fees at all in this case and the maximum order that can be made is therefore nil’. Before considering whether or not to seek an order for costs, representatives ought to bear in mind not only whether costs were incurred on behalf of their clients but also whether the fee was paid by their clients. For example, do their clients have to refund the insurers/consultants/unions, etc.?

Ticking the boxes

Roberts v Chief Constable of Hampshire and Isle of Wight UKEAT/0254/14/DA deals with the age-old matter of whether or not a proposed amendment to an originating application (the ET1 form) (or, as is sometimes the case, via further and better particulars (FBPs)) is an entirely new factual allegation to that pleaded in the ET1, in which case the new claim is often, on the face of it, time-barred. The authority for dealing with leave for applications to amend is Selkent Bus Company v Moore [1996] ICR 836.

In Roberts, in order to present her complaint in the ET before the introduction of issue and hearing fees, the claimant quickly lodged a claim, which the EAT described as ‘rudimentary in the extreme’. The ET1 was completed with assistance while the claimant’s union considered whether or not to represent her. The ET1 had the box ticked for disability discrimination but no other type of discrimination. The union then agreed to represent the claimant and produced FPBs, which included, among other things, allegations of pregnancy and maternity and sex discrimination.

The employer successfully challenged the purported new claims in the ET, where the judge found that there was no reference to them in the ET1 – ‘They [had] not previously been pleaded’ – and refused permission to amend. The claimant appealed successfully to the EAT, which held that the ET had failed to apply Mr Justice Mummery’s general guidance in Selkent. Although the ET mentioned the authority, it nonetheless failed to apply it – that is, to take into account all circumstances, balancing the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it. As practitioners know, it is tempting simply to look at the relevant box on the ET1 and undertake a basic observational exercise in order to determine whether or not an alleged complaint has been pleaded. Clearly, there is more to opposing an application for leave to amend than just that. Selkent demands more.

Affirmation of contract

At one stage or another, a practitioner will be or has been asked how long an employee has to work after an employer has breached their contract for them to be deemed to have affirmed it or something similar. This is a difficult question to answer, and a response akin to ‘it depends on the circumstances’ is neither terribly helpful nor informative.

However, an interesting case recently came before the EAT clarifying the position when an employee resigns long after the alleged fundamental breach of contract for reasons that they had been on sick leave. In Mari v Reuters Ltd UKEAT/0539/13/MC, the claimant was off sick with stress and depression from 24 August 2010 until she resigned many months later on 8 April 2012. Notably, during this period she had accepted her contractual sick pay (for some 39 weeks) until it expired in May 2011. In her claim before the ET, she alleged, among other things, constructive unfair dismissal. She claimed that she was too unwell to resign sooner.

The ET found that despite being off work sick, she had affirmed the contract. She appealed. In rejecting her appeal, the EAT added that the claimant’s relatively rare visits to the GP, coupled with her ability to travel and engage in correspondence, all supported the ET’s conclusion that she was not so ill that she was unable to resign. This decision demonstrates that even if the alleged repudiatory breach may have caused an employee to be on sick leave, the same principles regarding whether or not that employee has affirmed the contract during that period still apply.

Diversity awareness and inclusion

Employers have to be alive to the consequences of their actions and policies/provision, criterion, or practice (PCP). This is stating the obvious, but this is the case even where, on the face of it, the said action/policy/PCP deals with one obvious concern but has an unlawful discriminatory effect, contrary to the Equality Act 2010.

Take, for example, Land Registry v Houghton and others UKEAT/0149/14/BA. The employer had a bonus scheme whereby managers had a discretion when paying bonuses to employees who had been issued with a warning due to a conduct-related matter. The claimants, who were disabled, had received warnings for their absences from work due to their disabilities, which meant they were precluded from receiving their bonuses. The employer was found by the ET (decision upheld on appeal) to have discriminated against the employees as there was no discretion to pay employees who had warnings for sickness absence (disability or non-disability-related).

Similarly, in Chawla v Hewlett Packard Ltd UKEAT/0280/13/BA, the employer was found to have discriminated against the claimant, who was disabled, when its PCP of shutting down access to email and internet for employees on long-term sickness absence resulted in his being unaware of important developments relating to his terms of employment and benefits. The ET found that the employer had failed to make reasonable adjustments in order to communicate with the claimant during the material time. We may be at a point where practitioners, when reviewing or (re)writing their clients’ staff handbooks and similar documents need to be versed not only in equal opportunities but also diversity awareness and inclusion.

Protected disclosure

Finally, to end on a statutory note, on 6 April 2015 the amendment to section 43K of the Employment Rights Act 1996 (ERA 1996) (extension of the meaning of ‘worker’) comes into force. The effect of the amendments is that student nurses and student midwives who undertake work experience as part of a course of education or training approved by the Nursing and Midwifery Council will fall within the extended definition of workers who may make a protected disclosure. The distinction between ‘worker’ and ‘employee’ is forever growing and becoming wider. It is doubtful, therefore, that this latest addition to the family of ‘worker’ under section 43K ERA 1996 will be the last. SJ