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In Singh v Metroline West Limited the Employment Appeal Tribunal decided that an employer had committed a fundamental breach of contract when it withheld company sick pay from an employee suspected of malingering. 

What happened in this case?

Mr Singh was a bus driver for Metroline.  On 24 January 2017, he was invited to a disciplinary meeting. The next day, he went off sick.  His absence was certified by a Fit Note.  He was also assessed by an occupational health advisor, who did not report that the illness was false.  Although Metroline offered company sick pay, it decided only to pay statutory sick pay because it believed that Mr Singh had gone off sick simply to avoid the disciplinary meeting.

On 15 March 2017, Mr Singh resigned claiming constructive dismissal.  He said that the company had seriously breached his contract of employment by failing to pay company sick pay.  He brought various claims against Metroline in the Employment Tribunal.  Although he succeeded in a claim for unlawful deduction from wages in respect of the failure to pay company sick pay, he failed in the related constructive dismissal claim (being the more valuable of the two claims since it covered losses flowing from the dismissal).

The Employment Tribunal looked at the relevant documentation and noted that the employment contract and the associated “Drivers’ Handbook” both provided for the withholding of company sick pay where sickness absence was not genuine.  However, this was only permissible where a “thorough investigation” had shown this to be the case.  That had not happened here.  Metroline’s Disciplinary Policy did provide for suspension without pay where the company had simply “deemed” an employee to have reported sick to avoid a disciplinary process.  However, Metroline had not suspended Mr Singh.

The Tribunal concluded that Metroline had breached Mr Singh’s employment contract.  However, they decided that it was not a fundamental breach.  They found that the decision to withhold company sick pay pending the disciplinary meeting did not reveal an intention no longer to be bound by the employment relationship.  Rather, they were encouraging the continuance of the relationship by having Mr Singh engage in the disciplinary process.  Since there was no fundamental breach, the constructive dismissal claim failed.  Mr Singh appealed to the Employment Appeal Tribunal.

What did the EAT decide?

The EAT decided that the Tribunal had got it wrong in deciding that the breach of contract was not fundamental.  The Tribunal’s view seems to have been that in order for there to have been a fundamental breach the employer had to intend no longer to be bound by the terms of the contract in a way which meant that it no longer wished to continue the employment relationship at all.

The EAT said this was an error in law.  In fact, what is required is an intention no longer to comply with the terms of the contract that is so serious as to go to the root of the employment contract.  They gave the example of employer who wanted to keep its staff but pay them less.  If the employer decided unilaterally to cut pay this would be a fundamental breach of contract, regardless of the desire to maintain the employment relationship.

The EAT also noted that the Tribunal had not considered two important cases of relevance.  Firstly, in Cantor Fitzgerald v Callaghan it was decided that whether non-payment of wages amounts to a fundamental breach may depend on whether the non-payment was deliberate.  Secondly, in Roberts v Governing Body of Whitecross Schoolit was decided that a mistaken belief that there was a contractual power to reduce pay did not prevent there being a fundamental breach of contract.  In this case, this meant that there was only one possible answer: Metroline had committed a fundamental breach of Mr Singh’s employment contract.

What does this mean for employers?

This case highlights the perils for an employer of jumping the gun.  If the employer had paused to gather evidence to substantiate its belief that Mr Singh was malingering, it would either have been able to withhold sick pay in accordance with its own terms, or potentially have moved to dismiss summarily on the grounds of dishonesty.  Alternatively, if the imperative was simply to cut pay as quickly as possible, it could have relied on the provisions entitling suspension without pay.  Unfortunately for the company, their hair trigger response landed them with a constructive dismissal claim.  The decision also underlines that a fundamental breach of contract is the basis for a constructive dismissal claim; the employer’s wider intentions are not relevant.

Employers who find themselves in this situation should also remember that it may still be possible to proceed with a disciplinary hearing, despite the fact that the employee has gone off sick.  Disciplinary hearings can be modified to try to secure the sick employee’s participation in the process.  Examples of modifications include: where and how the hearing is held; who is allowed to accompany the employee; the role that any companion takes in the hearing; the structure and timing of the hearing; and the making of written submissions in addition to, or instead of, attending the hearing in person.  In rare cases it may even be necessary to proceed with a disciplinary hearing without the employee present. However, you should seek legal advice before proceeding down this route.  

Singh v Metroline West Ltd

BDBF is a law firm based at Bank in the City of London specialising in employment law.  If you would like to discuss any issues relating to the content of this article, please contact Principal Knowledge Lawyer Amanda Steadman (amandasteadman@bdbf.co.uk) or your usual BDBF contact.

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In the recent case of Coulson v Rentplus Ltd, the Employment Appeal Tribunal upheld a decision that the Acas Code of Practice on Disciplinary and Grievance Procedures applied to a sham redundancy dismissal that was tainted by discrimination.  The Code had been completely disregarded, meaning that a maximum 25% uplift to the compensation was justified.

What happened in this case?

Ms Coulson was employed by Rentplus from 2015 as its Director of Partnerships.  In Spring 2017, Mr Collins was appointed as a consultant, with a view to him taking over as CEO later in the year.  Around this time, a decision was taken to dismiss Ms Coulson, albeit not immediately.  Mr Collins duly took over as CEO in the Autumn and, from that point onwards, Ms Coulson said she felt that she was being “frozen out”.

In early 2018, Rentplus embarked on what they badged as a redundancy exercise, despite the fact that the number of job roles were due to increase.  Ms Coulson attended redundancy consultation meetings in April and May 2018.  She also submitted a grievance alleging that she had been marginalised by Mr Collins, and that her role was not genuinely redundant.  Her grievance (and subsequent appeal) was rejected, and Ms Coulson was eventually dismissed by reason of redundancy.

She brought claims for unfair dismissal and direct sex discrimination.  The Employment Tribunal decided that the dismissal was unfair on the basis that the decision to dismiss had been taken in Spring 2017, meaning the redundancy consultation process was a “total sham”.  The Tribunal also said the dismissal was tainted by sex discrimination.  Separately, the Tribunal found the grievance process to be just as much of a sham as the redundancy process.

When awarding compensation for the unfair dismissal, the Tribunal awarded an uplift of 25% due to the company’s “egregious failures” to comply with the Acas Code of Practice on Disciplinary and Grievance Procedures (the Code).  However, this issue was only dealt with very briefly in the judgment.

Rentplus appealed, arguing that the Tribunal had been wrong to say the Code applied where the reason for dismissal was either redundancy or sex discrimination.  Further, even if the Code did apply, the Tribunal had not identified the failings for which the uplift was being made and did not explain the basis on which it had determined the amount of the uplift.

What did the EAT decide?

The EAT noted that the Tribunal’s decision on the uplift would have benefited from a more detailed approach. However, the EAT was prepared to look at the judgment overall and consider whether, on a fair reading, the Tribunal judge had considered the four key issues.

Is the claim one which raises a matter to which the Code applies?

The EAT noted the Code applies to “disciplinary situations”.  This means that there is an issue of potential misconduct or poor performance to be addressed, regardless of how it is badged by the employer. The EAT highlighted that employers cannot sidestep the Code by dressing up a dismissal that flows from one of these things by pretending it is something else, for example, a redundancy. It was also noted that a finding of discrimination does not preclude the application of the Code.  For example, if an employer dismisses for perceived poor performance, which is partly a result of discriminatory assumptions, there will still be a disciplinary situation and the Code will apply.

In Ms Coulson’s case, redundancy had been rejected as the true reason for dismissal.  She had been dismissed because there was a belief that there were problems with her capability and/or conduct and that belief was tainted by sex discrimination.  As such, this was a disciplinary situation to which the Code applied.

If yes, has there been a failure to comply with the Code in relation to that matter?

The EAT drew a distinction between employers who attempt to comply with the Code but fall short, and those who act in bad faith and pretend to apply the letter of the Code but have already made their decision.  In the former scenario, it may not be appropriate to award an uplift, whereas it may be appropriate to do so in the latter.  In Ms Coulson’s case, it was clear that the Tribunal had concluded that the dismissal process was a sham, the dismissal was pre-determined and there had been a total failure to comply with the Code.

If yes, was the failure to comply with the Code unreasonable?

The EAT noted that in order for an uplift to apply, it is not enough that there has been a failure to comply with the Code, the failure must also be unreasonable.  In Ms Coulson’s case the Tribunal had said the breaches were “egregious”.   Therefore, it was clear that the failures in this case went beyond being merely unreasonable.

If yes, is it just and equitable to award an uplift because of the failure to comply with the Code and, if so, by what percentage?

The EAT noted that Tribunals must apply the four-stage test set out in the case of Slade v Briggs to decide whether it is right to award an uplift and, if so, by how much.  Generally, Tribunals should identify the failings for which the uplift is being made by reference to the relevant parts of the Code.  However, in Ms Coulson’s case, the Tribunal had said the dismissal process was a “complete sham” and Rentplus had acted in bad faith such that there was a total failure to apply the Code.  Therefore, they had been entitled to award a 25% uplift.

What does this mean for employers?

This decision reminds us that the question of whether the Code applies is one of substance and not form.  The key question you should ask is: do we consider the employee to be culpable for something that we wish to address in a formal process?  If yes, the chances are that the Code will apply.  Given the risk of an uplift, the safest course of action will be to observe the principles set out in the Code.

The decision also tells us that even if discrimination is present, there may still be a “disciplinary situation” meaning the Code applies.  This is important because where action is tainted by discrimination, the usual cap on compensation is lifted.  This means that the uplift for breaching the Code may be applied to a higher sum than would have otherwise been the case.  Indeed, in one recent discrimination case, a 20% uplift of over £317,000 was awarded, because the overall compensation was so high.

Rentplus UK Ltd v Coulson

BDBF is a law firm based at Bank in the City of London specialising in employment law.  If you would like to discuss any issues relating to the content of this article, please contact Principal Knowledge Lawyer Amanda Steadman (amandasteadman@bdbf.co.uk) or your usual BDBF contact.

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An Employment Tribunal has held that a woman suffered harassment related to sex when her employer failed to provide a private room for her to express breastmilk while at work. The employee was forced to express milk in the toilets or her car, which had the effect of creating an unwanted, degrading or humiliating environment for her.

What happened in this case?

Ms Mellor was a school-teacher at MFG Academies Trust.  While she was pregnant, she told the school that when she returned to work after maternity leave, she would need somewhere to express breast milk.  She raised this again while on maternity leave and again on her return to work in September 2020.  However, the School failed to provide her with an appropriate room.

This meant that she was forced to express milk in either the school toilets or her car during her lunch break. She was given 25 minutes for lunch, 20 minutes of which was needed to express milk, meaning she was forced to eat her lunch at the same time.

Having chosen to continue breastfeeding, it was a necessity for Ms Mellor to express, as not doing so would cause her to experience embarrassing leakages and she could develop mastitis (and had done so in the past).

Ms Mellor brought claims of direct and indirect discrimination and harassment related to sex against the school.

What was decided?

Direct discrimination

Ms Mellor compared herself to the hypothetical comparator of a male teacher injecting himself with insulin. The school confirmed that they would have provided such a male teacher with appropriate space if asked. Nevertheless, the Tribunal decided this claim failed because Ms Mellor was unable to show that the treatment she received was because of her sex. They found that the treatment was because of the incompetence of the school, rather than because she was a woman. 

Indirect discrimination

The Tribunal held that the school’s practice of not providing suitable facilities to express milk did not put women at a particular disadvantage in comparison to men because “biological men have no interest in the provision of facilities for expressing breastmilk”.

Essentially the Tribunal said they were bound by a previous case, which stated that indirect discrimination cannot be shown without meaningfully applying the practice to both men and women. Therefore, as needing a space to express breastmilk was solely a biological female function this claim had to fail.

Harassment

The Tribunal found that Ms Mellor genuinely and reasonably had no choice but to express breast milk in either the toilets or her car. It also found that forcing her to express milk while eating her lunch, and potentially being seen by pupils, was unwanted conduct and had the effect of creating a degrading or humiliating environment for her. 

They also held it was related to Ms Mellor’s sex, as the need for privacy to express milk came from the intimate nature of the activity, because she is a woman.

What does this mean for employers?

Although there is no statutory right to the provision of facilities at work to express milk, there is guidance from the Health and Safety Executive which recommends that employers should provide facilities such as a private, clean environment (other than toilets) and a fridge to store the expressed milk.  Employers should give careful consideration to any request for a space from a worker who is expressing milk since there is a risk of harassment depending on the particular circumstances. 

Mellor v MFG Academies Trust

BDBF is a law firm based at Bank in the City of London specialising in employment law.  If you would like to discuss any issues relating to the content of this article, please contact Associate Hannah Lynn (hannahlynn@bdbf.co.uk), Principal Knowledge Lawyer Amanda Steadman (amandasteadman@bdbf.co.uk) or your usual BDBF contact.

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In Burke v Turning Point Scotland an Employment Tribunal decided that an employee who had suffered with Covid symptoms for around nine months was disabled and could proceed with a disability discrimination claim.

What happened in this case?

Mr Burke was employed as a caretaker from April 2001. He caught Covid in November 2020.  After the initial isolation period, his symptoms continued and included serious fatigue, severe headaches, joint pain, and insomnia.  His symptoms meant he could not undertake ordinary household tasks such as cleaning, ironing, or cooking and would tire very easily.

Mr Burke went on sick leave from November 2020. He obtained Fit Notes from his doctor, which suggested that he had long Covid and post-viral fatigue syndrome. The employer sought two occupational health reports in April and June 2020.  These contradicted the Fit Notes and stated that Mr Burke was fit to return to work and that it was unlikely that he was disabled.

However, Mr Burke’s symptoms worsened, and he did not return to work.  The company eventually dismissed him on the grounds of ill-health in August 2021.  Mr Burke brought a claim for disability discrimination.  A preliminary hearing was held to decide whether Mr Burke was “disabled” for the purposes of discrimination law (being the first hurdle required to progress a disability discrimination claim).

What was decided?

The Employment Tribunal found Mr Burke to be a credible witness who had not exaggerated his symptoms (especially when there was no financial benefit to him in remaining on long-term sick leave) and that the post-viral fatigue syndrome caused by Covid amounted to a physical impairment.

The Tribunal also decided that the condition had a substantial impact on his ability to undertake day-to-day activities and (at the time of his dismissal) his symptoms were likely to last for 12 months.  Therefore, the Tribunal concluded that Mr Burke was disabled and could proceed with his claim for disability discrimination.

What does this mean for employers?

Last month, we discussed the question of whether long Covid could amount to a disability.  Despite some confusing guidance from the Equality and Human Rights Commission, we concluded that long Covid would, in some cases, amount to a disability.  This latest decision supports that view. 

Employers should be aware that employees with long Covid may be disabled, meaning that they will be protected from discrimination and that reasonable adjustments should be made for them.  This could include things like offering a phased return, a part-time hours arrangement or adjusting trigger points in absence management policies.

This decision is also a useful reminder for employers not to rely on occupational health reports to make conclusive determinations about whether or not an employee is disabled.

Burke v Turning Point Scotland

BDBF is a law firm based at Bank in the City of London specialising in employment law.  If you would like to discuss any issues relating to the content of this article, please contact Managing Associate Emily Plosker (emilyplosker@bdbf.co.uk), Principal Knowledge Lawyer Amanda Steadman (amandasteadman@bdbf.co.uk) or your usual BDBF contact.

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Despite the fact most of the Government’s promised employment law reforms have been kicked into the long grass, the appetite to talk about reform in this area shows no sign of let up.  In this briefing, we discuss the latest proposals.

The eagle-eyed among you may have noticed that the Employment Bill (first announced back in December 2019) was absent from the Queen’s Speech delivered on 10 May 2022.  That Bill was meant to pave the way for a number of important reforms including:

• Making the right to request flexible working a Day 1 employment right.
• Extending redundancy protection to pregnant workers and those returning from various forms of family leave.
• Introducing a new right to neonatal leave and pay.
• Introducing a new right to one week’s unpaid leave for carers.
• Introducing a new right for workers to request a more predictable contract.
• Introducing a single enforcement body for key employment rights.

It is not clear when, or even if, these reforms will be implemented. 

Elsewhere, the Government had committed to regulate the use of non-disclosure agreements, introduce a mandatory duty on employers to prevent sexual harassment and introduce a statutory code governing “fire and rehire” practices.  All of these commitments have yet to be delivered.   On top of this, the Government has yet to publish its response to the consultation on restricting the use of non-compete clauses in employment contracts.  Several other consultation responses and reviews remain outstanding, for example, the reviews of the family rights, whistleblowing and gender pay gap frameworks.

However, this ever-growing employment law “to do” list has not deterred the Government from yet more talk of reform in this area.

On 10 May 2022, it was announced that Matt Warman MP would lead a review of the “Future of Work” which will look at how to expand the economy after the Covid-19 pandemic.  The review is to be conducted this Summer and will look at issues such as the role of automation and how flexibility in the labour market (e.g. in the gig economy) can be used to encourage growth, while also taking action to avoid the use of exploitative practices.  Once the review is concluded, a report will be submitted to the Prime Minister to inform strategic policy making on labour market issues.

Hot on the heels of this announcement, on 27 May 2022, the Business, Energy and Industrial Strategy (BEIS) Committee launched a call for evidence into the future of the UK labour market.  The call for evidence is seeking submissions on the following issues:

• The state of play in the UK labour market post-Brexit and the impact of the Covid-19 pandemic on recruitment, skills shortages, and the growth of the labour market.
• Artificial intelligence and technology in the workplace.
• Workers’ rights and protections.
• Employment status and modern working practices five years on from the Taylor Review.
• The impact of an ageing population on the labour market.

Across these five areas, an array of questions are posed, some of which will be of particular interest to employers, for example:

• To what extent is long Covid causing long-term sickness absence and early retirement?
• How should employment rights be improved?
• How should UK workers’ rights and protections be differentiated from EU standards?
• Do employment laws need to be updated to reflect the increase in hybrid working?
• How has the demand for flexible working been affected by the pandemic and what should the Government do about it?
• Are current legal definitions of employment status fit for purpose?

If you would like to submit evidence to the BEIS Committee you can do this online by 8 July 2022. 

It is not clear what the next steps will be, although the usual practice is for a public consultation to follow a call for evidence.  If so, this would mean that we are unlikely to see any reforms until next year at the very earliest.  Although, if the Government intends to deliver on its earlier promises, the wait could be even longer than this.  With a General Election expected by 2024, the window for delivering concrete reforms before then is beginning to close. 

BDBF is a law firm based at Bank in the City of London specialising in employment law.  If you would like to discuss any issues relating to the content of this article, please contact Principal Knowledge Lawyer Amanda Steadman (amandasteadman@bdbf.co.uk) or your usual BDBF contact.

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