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US company prevented from suing UK worker in US cou

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An injunction has been granted to require that a company withdraw its motions in a Massachusetts court against an employee domiciled in the UK. This was so despite the fact that the relevant agreement reserved jurisdiction to the Massachusetts courts.

Mr Petter was employed in the UK by EMC Europe Limited. EMC Europe’s parent company was EMC Corporation, a Massachusetts company. Mr Petter entered into a share incentive scheme with the US parent; the agreement for the scheme was governed by Massachusetts law and gave exclusive jurisdiction to the courts of Massachusetts. Mr Petter tendered his resignation in order to join a competitor and the US parent issued proceedings in Massachusetts seeking a declaration that awards of stock under the incentive scheme could be rescinded. In response, Mr Petter issued proceedings in the English courts seeking, amongst other things, an injunction restraining the proceedings in Massachusetts. The interim injunction application was heard in the High Court on 14 and 15 July 2015. Between then and the delivery of a judgment in the UK, EMC filed motions for an injunction preventing continuance of the UK action and summary judgment. The Massachusetts court obliged in granting the injunction.

The Court of Appeal granted an injunction to restrain the proceedings in Massachusetts. It held that the share incentive scheme was designed to reward on-going service with the UK entity, so was clearly related to Mr Petter’s contract of employment. As such, the Recast Brussels Regulation operated to protect Mr Petter by providing that he may only be sued in the UK, being the Member State in which he resided.

The Court of Appeal took the view that EMC’s activity in Massachusetts was calculated to pre-empt a decision in the English courts. With that in mind, it provided that the injunction be mandatory – not only was EMC restrained from continuing proceedings in Massachusetts, but it also had to take positive action to withdraw its motions.

Employers should note that even clear jurisdiction clauses in agreements with employees may not be definitive. The European regime provides robust protection and English courts have the authority to restrain proceedings elsewhere in these circumstances and may react adversely to employers’ attempts to subvert it.

Petter v EMC Europe Ltd v anor [2015] EWCA Civ 828

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Dismissal for Facebook ‘banter’ was fair

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An employer can fairly dismiss an employee for making derogatory comments on a personal Facebook account. This is so even where the posts in question were made a number of years previously and were explained by the employee as ‘banter’.

Mr Smith was employed by the British Waterways Board as a manual worker on canals and reservoirs. A rota provided that for one week of every five, Mr Smith was required to be on standby, during which time he could not consume alcohol. The Board had a social media policy whereby “any action on the internet which might embarrass or discredit” it was prohibited. Mr Smith raised a number of grievances and a mediation was scheduled in May 2013 to deal with them. In response to that, one of Mr Smith’s managers produced disparaging comments Mr Smith had made on his personal Facebook page. HR subsequently searched his page for further comments. It was found that Mr Smith had uploaded a number of posts to Facebook around two years previously, which included: “good old bw cant wait to see all my friends again lol”; “going to be a long day I hate my work”; “on standby tonight so only going to get half p***** lol” and; “im on vodka and apple juice first time ive tried it no too shabby”. The privacy settings on Mr Smith’s Facebook page were set to public, though Mr Smith denied knowledge of or responsibility changing the settings.

Mr Smith was suspended from work on his arrival at the mediation. A disciplinary hearing on 4 June 2014 resulted in Mr Smith’s summary dismissal for gross misconduct on grounds that the posts were derogatory to the Board and suggested that Mr Smith was drinking on standby, which would affect the Board’s reputation. After an unsuccessful appeal, Mr Smith brought proceedings for unfair dismissal.

The Employment Appeal Tribunal held that the dismissal was fair. It held that summary dismissal for gross misconduct was one of the options open to the Board in response to Mr Smith’s Facebook posts. Whilst there were mitigating factors, such as the length of time since the comments were posted and the fact that Mr Smith had an otherwise exemplary record, the Board was entitled to attach minimal weight to them.

This confirms that, at least in some circumstances, an employer will be able to rely on historic misconduct to justify summary dismissal. It also emphasises the importance of an employer having and implementing an appropriate social media policy.

The British Waterways Board v Smith [2015] UKEATS/0004/15

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Sick workers can choose to carry over annual leave

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Workers on sick leave can choose to carry over their annual leave for up to 18 months after the leave year in which it accrued. There is no need for the worker to be physically incapable of taking their annual leave entitlement.

Mr Plumb was employed by Duncan Print Group Ltd as a printer. Mr Plumb suffered an accident at work and, as a result, he remained on sick leave from 26 April 2010. Mr Plumb did not take or request any annual leave until September 2013, at which point he asked Duncan Print for permission to take all his accrued leave from the date he went on sick leave. Duncan Print agreed to pay for accrued leave in the current leave year (1 February 2013 to 31 March 2014) but would not pay for leave accrued in prior years. Once his employment terminated on 10 February 2014, Mr Plumb brought a claim for payment in lieu of the accrued but untaken holiday since his sick leave commenced. In its defence, Duncan Print argued that the annual leave could not be carried over because Mr Plumb had been unwilling, not unable, to take it.

The Employment Appeal Tribunal held that the annual leave had carried over. There was no requirement that the worker be incapable of taking annual leave due to illness. It was enough that the worker on sick leave had chosen not to take annual leave whilst on sick leave; whilst workers can take annual leave whilst on sick leave, there is nothing compelling them to do so. This is because the two kinds of leave are intended to have different purposes: sick leave enables unwell workers to recover from illness whereas annual leave allows for periods of rest and relaxation for health and safety reasons.

That said, the EAT concluded that leave cannot accrue indefinitely. A worker is able to carry annual leave over for a maximum of 18 months; therefore, Mr Plumb was entitled to around half of the amount he had claimed.

Plumb v Duncan Print Group Ltd UKEAT/0071/15

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Summary dismissal for health and safety breach was unfair

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An employer’s decision to dismiss an employee summarily on grounds of gross misconduct was not a reasonable response to an employee’s failure to adhere to a new health and safety procedure. It was therefore outside of the ‘range of reasonable responses’ open to the employer, and it constituted an unfair dismissal.

Mr Newbound was employed as a penstock co-ordinator by Thames Water. He had been employed for 34 years with a clean disciplinary record. Thames Water introduced a new safe system of work form, the SHE4, which specified that breathing apparatus must be used for sewer inspections. Mr Newbound’s line manager ran through the form with Mr Newbound and an independent contractor, Mr King. Mr Newbound and Mr King consulted Mr Andrews, the ‘competent person in charge’ of the site, as to whether it was safe to proceed into the sewer without breathing apparatus. As the gas monitor indicated that it was safe, Mr Newbound and Mr King entered the sewer wearing dust masks and carrying a gas monitor. Mr Gunn, field services manager, attended the site and noted that the men were not wearing breathing apparatus. As such, Mr Gunn undertook an investigation into potential misconduct.

Mr Gunn found that Mr Newbound had countersigned the SHE4 and used a dust mask, which had been inadequate protection. Mr Gunn decided that whilst Mr Andrews was the competent person in charge, he was relatively inexperienced, whilst Mr Newbound was also senior and had led Mr King into the sewer. As such, gross misconduct proceedings were commenced against Mr Newbound whereas Mr Andrews was given a warning. Mr Newbound appealed following his summary dismissal for a serious breach of a health and safety policy. The appeal was rejected, and Mr Newbound brought a claim for unfair dismissal.

The Court of Appeal held that the dismissal had been unfair. To say that summary dismissal was within Thames Water’s range of reasonable responses in these circumstances would be to stretch the test to an infinite width. The employment tribunal made 4 findings with regards to SHE4, all of which were crucial to the finding of unfair dismissal: (i) SHE4 was a relatively new document; (ii) employees had not been trained on SHE4; (iii) Mr Newbound had previously exercised discretion as to whether to use breathing apparatus; and (iv) Thames Water had not previously objected to Mr Newbound relying on his experience in such matters. Further, the Court of Appeal found that Thames Water’s disparate treatment of Mr Andrews, who only received a written warning, was “an obvious case of unjustified disparity”.

This case shows that employees’ breaches of health and safety will not be treated any differently by tribunals than would be the case with any other cases of misconduct. As such, employers should not expect greater deference in respect of their decisions to dismiss where the misconduct relied on relates to health and safety.

Newbound v Thames Water Utilities Ltd [2015] EWCA Civ 677

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Works councils: request must be made by 10% of the whole business’ workforce

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In the context of the Information and Consultation of Employees Regulations 2004, an “undertaking” refers to a legal entity – i.e. the employer as a whole – rather than individual business units.

The ICE Regulations provide that employers must set up information and consultation agreements, effectively a “worker’s council” if its employees make a valid request to negotiate. In order for such a request to be valid, it must be made by a minimum of 10% of the employees in the business subject to a minimum of 15 and a maximum of 2,500.

A group of 28 staff employed by Cofely Workplace Ltd put in a request to form a worker’s council. They amounted to 13% of the staff employed at the particular workplace, but only 0.3% of Cofely’s total workforce of 9,200 employees. The staff argued that the threshold refers to the numbers of employees in a specific place of work rather than the entire company, so their request was valid.

The Employment Appeal Tribunal disagreed, holding that the threshold referred to Cofely as a whole. The regulations were not intended to apply to specific business units.

Moyer Lee and others v Cofely Workplace Ltd UKEAT/0058/15

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Ignorance of need to consult collectively no bar to protective awards

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An employer’s claim that it failed to consult collectively because it was not aware that it was obliged to do so is no excuse, and protective awards (of up to three months pay per employee) remain payable in such circumstances. Further, if an employer has relied on its ignorance to justify non-consultation, it cannot also suggest that special circumstances had rendered collective consultation not reasonably practicable.

A school operated by E Ivor Hughes Educational Foundation was suffering from financial difficulties caused by a decline in pupil numbers. At a meeting in February 2013, the governors recognised the problem and discussed options for how to keep the school open if pupil numbers remained low. Once the actual number of pupils for the next academic year was confirmed in April 2013, it transpired that numbers were worse than predicted. As such, the governors decided that the school would have to close at the end of that term. Three days after that decision was made, school staff were given notice that their employment would end in August 2013. No collective consultation took place.

The staff brought claims challenging their dismissal and the lack of collective consultation. The Foundation argued that the governors had not been aware of the obligation to consult collectively and, even if they had been, special circumstances had meant that it would not have been reasonably practicable for the Foundation to consult collectively. The Foundation identified the special circumstances as (i) that informing staff about the potential need to close the school would have leaked to parents, causing them to remove their children and further affecting the school’s budget; and (ii) the fact that school staff must be given one term’s notice of termination, meaning notice had to be served quickly to avoid having to pay wages for another term.

The Employment Appeal Tribunal held that it was immaterial that the governors were unaware of the obligation to consult collectively, and accordingly upheld the order for the maximum protective award of 90 days’ gross pay. As the order was a punitive measure, it was not linked to the extent of any loss suffered by the staff. It was artificial for the Foundation to argue that special circumstances existed as the governors’ lack of knowledge that they must consult collectively meant they would not have evaluated whether or not they could carry out the consultation. Circumstances identified in hindsight cannot be relied on.

E Ivor Hughes Educational Foundation v Morris and others, UKEAT/0023/15

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Employee fairly dismissed despite procedural defects

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A fairly conducted appeal is capable of remedying even serious procedural defects in the first part of a disciplinary process.

Ms Adeshina was a Principal Pharmacist employed by the Prison Service as part of St George’s University Hospital Trust. She objected to the Prison Service’s plans to change the way it ran its pharmacy services; her resistance to the project gave rise to allegations of misconduct, such as unprofessional and inappropriate behaviour. The disciplinary process (conducted by Ms Ashworth) itself contained a number of procedural failings; for example, not all of the evidence informing the decision was presented to Ms Adeshina for her to provide an explanation. Ms Adeshina was dismissed, against which she appealed.

The appeal was conducted by three senior managers, comprising: (i) one manager, Ms Ludlam, who mentored an alleged victim of Ms Adeshina’s misconduct; (ii) another, Mr James, who was less senior and in fact reported to Ms Ashworth; and (iii) an independent advisor. The appeal consisted of a complete rehearing, after which the dismissal decision was upheld.

Ms Adeshina brought a number of claims, including unfair dismissal. She objected to the constitution of the appeal panel, arguing that Ms Ludlam was biased due to her contact with the alleged victim, and that Mr James’ lack of seniority would mean that he was swayed.

The Employment Appeal Tribunal held that the appeal had been fairly conducted, all things considered. It found that senior managers in most companies will, in reality, have had some prior dealings with the employees involved in a dispute without them necessarily being biased. Further, though ACAS guidance does provide that appeals be conducted by more senior managers than those who made the disciplinary decision, the presence of an independent advisor allayed concerns that Mr James would be pressured. The defects in the initial disciplinary hearing were serious, but not so serious as to prevent the appeal from remedying them. The process must be looked at in the round and the means by which Ms Adeshina’s dismissal was brought about were fair overall.

This demonstrates the power that a well-conducted appeal can have in fixing the problems in a disciplinary procedure particularly when done by way of a rehearing.

Adeshina v St George’s University Hospitals NHS Foundation Trust and others UKEAT/0293/14

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Employee transferred under TUPE despite client instruction to remove her from the contract

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If a client instructs that an employee be removed from working on its contract which is set to transfer under TUPE, that employee will still transfer if the outgoing employer decides not to heed the instruction.

Ms Jakowlew was a care manager employed by Saga Care, which provided care services to the London Borough of Enfield. Saga’s contract with Enfield was set to expire, at which point the services would be provided by Westminster Homecare Ltd. Conflict between Ms Jakowlew and her manager led to her being suspended pending a disciplinary hearing. Following Ms Jakowlew’s suspension, Enfield exercised its contractual right to instruct Saga to remove Ms Jakowlew from the team providing its care services. Saga refused and gave Ms Jakowlew a final written warning the day before the TUPE transfer was due to occur. Saga advised Ms Jakowlew that her employment had transferred to Westminster; however, Westminster alleged she had never transferred. Ms Jakowlew claimed to have been unfairly dismissed.

The Employment Appeal Tribunal found that Ms Jakowlew’s employment had indeed transferred to Westminster as part of the TUPE transfer. The instruction by Enfield to remove her from the undertaking was not of itself enough to prevent a transfer taking place. To prevent the transfer, it would have been necessary for Saga to act on the request by reassigning Ms Jakowlew. As Saga had refused to do so, Ms Jakowlew went across with the undertaking.

It appears to have been material in this case that Enfield had a potential breach of contract claim against Saga for its failure to act on instructions to reassign Ms Jakowlew. However, such a claim would only be worth pursuing if it had suffered actual loss because of the breach and whether Saga was obliged to indemnify it for the loss. With that in mind, service recipients may wish to ensure that any outsourcing agreements are negotiated to include indemnities for loss suffered by them as a result of employees transferring under TUPE contrary to their direct instructions.

Jakowlew v Nestor Primecare Services Ltd (t/a Saga Care) and another UKEAT/0432/14

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Peripatetic workers ‘at work’ when travelling between home and assignments

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Peripatetic workers – i.e. those who travel between different assignments rather than having a single set workplace – are considered ‘at work’ when travelling between their homes and assignments given to them by their employer.

Tyco Integrated Security and other companies in its group offered security system installation and maintenance to customers in Spain. Its technicians had an app on their smart phones which listed all of the assignments they must attend in each given day. The technicians would travel from home to the first assignment on the list, between different assignments, and from the last of the day’s assignments to their homes. Tyco did not count the time technicians spent travelling from home to the first assignment, or travelling to home from the last assignment, as working time.

The technicians challenged this decision and the matter went before the European Court of Justice.

The Advocate General delivered his opinion on the case, finding that the first and last journeys of the day are considered to be ‘working time’. He reasoned that travelling is an integral part of being a peripatetic worker; therefore, whenever a worker transports himself to a customer, he is “at work”. Similarly, the technicians remained at the disposal of Tyco on their way home; the company was at liberty to ask technicians to make extra stops after the last assignment on the list and could equally cancel scheduled appointments. Therefore, the technicians ought to be seen as “at work” from the time they set off in the morning to the time they returned home.

Whilst the Advocate General’s opinion is not technically binding, it is unlikely that the ECJ will reach a conflicting decision. Therefore, in anticipation of this, employers of staff with no fixed base (such as some maintenance workers, as in the present case) would be wise to review their pay and working time calculations to ensure that all the time spent by workers in transit is accounted for.

Federación de Servicios Privados del sindicato Comisiones Obreras v Tyco Integrated Security SL and another (C-266/14)

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