APSCo Employment Update – October 2010

20th October 2010

Provided by Osborne Clarke. Image

Welcome to our October Employment Update. Each month, we review the case developments and legislative changes and pick out the essential issues for you to address to keep up with the ever changing impact of employment law.

The Equality Act 2010

Action Point

The Equality Act 2010 ("EA") is now in force. Whilst the Act undoubtedly changes the face of discrimination for employment lawyers, for businesses already operating best practice the Act is largely "all change no change".

However, all employers will now need to take some practical steps. A detailed checklist is available here. Headline steps include:

• Update policies and procedures. Harassment and equal opportunities policies will need to reflect new discrimination concepts/terminology. Recruitment
policies and procedures including medical questionnaires, will need to be reviewed in light of the new provisions outlawing pre-employment health questions.

• Consider whether pay secrecy clauses (if any) should be retained in contracts of employment.

• Update compromise agreements to include claims under the EA. However, due to an error in the legislation which raises doubts over the ability to compromise, we advise also including a warranty that the individual will not bring any claims under the
EA. Where claims under the EA are in issue, take legal advice to check whether any other precautionary steps should be taken.

• Train managers and HR in best practice on recruitment procedures and new discrimination concepts.

• Protect against liability for third party harassment by amending harassment policies, clearly stating (perhaps by way of notices) that harassment will not be tolerated and likewise amending any applicable policies and agreements with third party service providers and contractors.

• Pending approval of the Codes of Practice (available here), familiarise yourself with guidance from the Equality and Human Rights Commission (available here)

Pre-employment health questions have perhaps attracted the greatest amount of media attention, some of which has been misleading. For further information on this tricky and controversial area, please read our insight here.

Why

Amongst much media coverage, on 1 October the vast majority of the EA came into force. Whilst there has been much consolidation of various anti-discrimination statutes and tidying up of inconsistencies, there have been some substantial changes including:

• extending the scope of associative and perceived discrimination and harassment;

• an extension to third party harassment rules;

• changes to disability discrimination offences including a new offence of indirect disability discrimination and replacing the offence of disability related discrimination with a new claim of discrimination arising from a
disability;

• an extension to the ability to take positive action (but not in recruitment and promotion);

• an ability for an Employment Tribunal to make recommendations relating to an employer's workforce, not just an individual claimant;

• limited "legal" scope for asking pre-employment health questions; and

• new rules regarding the enforcement of contractual pay secrecy clauses.

The more controversial provisions of combined discrimination, equal pay audits for private employers with 250 plus employees and positive action in recruitment and promotion are still under consideration and not in force.

Our overview of the Equality Act is available here.

Julian Hemming
Partner
T +44 117 917 3582
julian.hemming@osborneclarke.com

Take care when giving references for former employees

Action Point

The recent Employment Appeal Tribunal ("EAT") decision in Bullimore v Pothecary Witham Weld Solicitors is a useful reminder that employers must always take care when providing or acting upon a reference. The Equality and Human Rights Commission has also issued some useful guidance "What equality law means for you as an employer: dismissal, redundancy, retirement and after a worker has left" in conjunction with the Equality Act 2010
("EA"), available here. We highlight some general considerations below:

Giving references:

• References (verbal and written) should only be given by authorised employees within your organisation. They should include a disclaimer and be marked private and confidential and for the attention of the addressee only.

• Consider having a policy of simply confirming dates of employment and position held. Otherwise ensure that the reference is factual, does not contain any inaccurate statements and does not give an overall misleading picture of employee.

• Do not take into account or refer to any proceedings the employee has brought against the company, any evidence he/she has given in any proceedings against the company or any allegations made relating to discriminatory acts.
These are all "protected" by legislation.

• Do not include comments about any protected characteristic, such as sex, race, sexual orientation, religious belief etc or refer to any absence (other than sickness absence) related to such a characteristic, e.g. maternity leave. Ensure any comments about performance or absence are not related to a disability.

Considering a reference:

• Exercise caution when deciding whether or not to withdraw a job offer on the basis of a poor reference. Withdrawal by reason of a protected act will be victimisation.

• In light of the new Equality Act 2010 provisions on pre-employment health questions, no account should be taken of information relating to health unless it has been specifically requested to establish whether or not the candidate can perform functions intrinsic to the role.

Why

A former employer has been held liable to compensate a former employee for future loss of earnings where a poor reference led to a prospective employer withdrawing its offer of employment. This was so, even though the prospective employer's conduct was itself unlawful.

A firm of solicitors provided a reference to a prospective new employer referring to the claimant's previous sex discrimination claim against it, the claimant's "poor relationship" with the firm's partners and that she could be "inflexible as to her opinions". This led to the prospective new employer withdrawing its offer of employment. An Employment Tribunal ("ET") found that both the former employer and the prospective employer had unlawfully victimised the claimant. However, the former employer was only ordered to compensate her £7,500 for injury to feelings with no award for loss of earnings since the unlawful actions of the prospective employer broke the chain of causation.

The EAT however found that as a matter of policy and fairness the former employer should be liable for all the direct consequence of its actions, including the claimant's loss of earnings. It was "evidently foreseeable" that the prospective employer would react to the poor reference as it did and its reaction was "a direct and natural consequence of the supply of the information". The mere fact the prospective employer had itself acted unlawfully did not break the chain of causation.

Whilst this case related to the Sex Discrimination Act 1975, it is equally applicable to the EA. Although the EA does not expressly prohibit post-employment victimisation, existing case law will almost certainly be used to ensure that the new provisions under the EA are interpreted to cover scenarios such as the above.

Danielle Kingdon
Partner
T +44 118 925 2020
danielle.kingdon@osborneclarke.com

Round-up of other Developments

A short break in activities will not necessarily prevent the Transfer of Undertakings (Protection of Employment) Regulations 2006 ("TUPE") applying.

In Wood v London Colney Parish Council, the EAT found that liability for the employment of a full time bar steward, dismissed a month before a social club surrendered its occupational licence to the freeholder, a parish council, was transferred to the parish council. The parish council had reopened the bar three weeks after the surrender of the licence but without a full time steward. There had simply been a temporary cessation of bar operations at the centre.

On a redundancy, it is for an employer to determine whether a vacancy is a "suitable" alternative for a woman on maternity leave. If it is, she must be offered the role and not merely invited to apply.

The EAT in Simpson v Endsleigh Insurance Services Ltd found that an employer was entitled to determine that a vacancy involving a relocation from London to Cheltenham would not have been suitable for the claimant. Hence it was not under an obligation to offer the role to her whilst she was on maternity leave. However, in determining whether a role is suitable, a sensible employer should enter into discussions with the employee as to what she may or may not be prepared to undertake since in reaching its determination it will need to consider the employee's personal circumstances.

National Minimum Wage increases: The national minimum wage increased from 1 October. The rates are now £5.93 per hour for workers aged over 21 (increasing from £5.80); £3.64 per hour for workers aged 16 and 17 but who are not apprentices and £2.50 for apprentices aged under 19 or aged 19 and over but in their first year of apprenticeship.

Family friendly initiatives: A consultation will be launched later this year looking at extending the right to request flexible working to all employees and on a new system of flexible parental leave. In the meantime;

Employers will need to amend maternity and paternity leave policies: The Additional Paternity Leave Regulations 2010 which enable fathers to essentially take over a mother's entitlement to paid maternity leave where the mother has returned to work early, will now apply to parents of children due on or after 3 April 2011. This is an interim measure pending the consultation referred to above.

Flexible working: The right to request flexible working will be extended to parents of children under 18 from April 2011. At present, the right is available to parents of children under 16, parents of disabled children under 18 and carers of certain adults.

Agency workers: Our insight on the Agency Workers Regulations 2010 which includes details of the steps employers should start considering in preparation for their coming into force in October 2011 is available here.

Volunteering at the Olympics 2012

Whilst a long way off, applications close on 27 October for people to volunteer to assist at the games. With more than 100,000 volunteer applications made already, many employers will be impacted. Employers should start considering now how they will deal with any requests for leave from successful applicants (and whether this has the potential for raising any discrimination issues when compared to any previous (or indeed future) stance taken in relation to requests for time off to attend other events). Information for employers produced by the London 2012 Olympics Organising Committee (LOCOG) is available here.

Contact

For more information on these or any other matter in this update, please contact your usual OC contact or Catherine Shepherd or Kath Sadler-Smith our specialist knowledge lawyers.

Kath Sadler-Smith
Associate
T +44 118 925 2078
kath.sadler-smith@osborneclarke.com  

Catherine Shepherd
Associate
T +44 117 917 3644
catherine.shepherd@osborneclarke.com