Changes to tribunal procedures from 6 April 2012

The following changes will apply to an employment tribunal claim that is made on or after 6 April 2012: Employment Tribunals (Constitution and Rules of Procedure) (Amendment) Regulations 2012 [SI 2012/468].

• A witness statement will be taken as read unless the tribunal directs otherwise.
• A costs order can include a payment for the expenses of a tribunal witness
• The maximum amount of costs for a vexatious tribunal claim will rise from £10,000 to £20,000
• The maximum amount of a deposit for an unmerited tribunal claim will rise from £500 to £1,000

No TUPE transfer: dayshift employees were not dedicated to the client

Eddie Stobart Ltd (ES) stored and delivered meat products for its clients, Forza and Vion. Forza and Vion were meat suppliers and supplied meat products to retailers (e.g. ASDA). The retailers would place their orders for meat products at different times for next-day delivery. As a result of this, the nightshift employees at the ES depot (in Manton Wood) mainly worked on tasks required by the Forza contract; and the dayshift employees mainly worked on tasks required by the Vion contract.

FJG Logistics Ltd (FJG) won the Vion contract. The dayshift employees claimed that they had been TUPE transferred to FJG – since they were an organised group of employees whose principal purpose was to work on the Vion contract.

The EAT disagreed. The dayshift employees were not organised by reference to the requirements of the Vion contract (e.g. they were not organised as the Vion team). The dayshift employees mainly worked on the Vion contract - because Vion's work had to be done during the dayshift - in order to deliver the meat products ordered by Vion's customers.

Eddie Stobart Ltd v FJG Logistics Ltd [EAT/0223/11]

Age discrimination: “cheapest employee” criterion was lawful

In HM Land Registry v Benson [EAT/0197/11], HM Land Registry (HMLR) asked its employees to apply for voluntary redundancy (VR) or early retirement (ER). The VR/ER scheme had a budget of £12 m. HMLR selected the “cheapest employees” (subject to the retention of necessary skills and a proper balance between staff grades) - in order to maximise the number of staff reductions. The “cheapest employees” were the employees who would receive the lowest amounts of redundancy pay.

Five employees who were aged over 50 years unsuccessfully applied for ER. HMLR considered them to be “expensive employees” because they would have received an immediate unreduced pension. The employees claimed that the use of the “cheapest employee” criterion was unlawful indirect age discrimination. The tribunal upheld their claim.

However, the EAT disagreed. The “cheapest employee” criterion was a proportionate means of reducing HMLR’s staff within the budget of £12 m. Therefore, the discrimination was lawful because it had been justified by HMLR. The tribunal had found that HMLR did not have any other alternative to using the "cheapest employee" criterion.

HMLR was not required to show that it had to reduce its staff within a budget of £12 m – because it had no more money - in order to justify the discrimination. However, the EAT warned that whether a “cheapest employee” criterion (or a similar criterion) could be justified will depend on the facts and circumstances of each case.

Indirect sex discrimination

The EAT found that HMLR’s failure to notify a female employee on a career break - that she would have to return to work in order to apply for VR – was unlawful indirect sex discrimination.

Comment

In Woodcock v Cumbria Primary Care Trust, the EAT expressed doubt as to whether para. 72 of Cross v British Airways correctly stated that discrimination could not be justified “solely on considerations of cost”.

Redundancy: suitable alternative employment

Devon Primary Care Trust (DPCT) employed Mrs Readman as a community matron. In 2007, she was made redundant but she was offered a job of hospital matron. Mrs Readman refused the job because she did not want to work in a hospital.

Mrs Readman did not receive a redundancy payment because DPCT believed that she had unreasonably refused an offer of suitable alternative employment.

Tribunal

The tribunal agreed with DPCT. Mrs Readman’s skills as a community matron could be easily transferred to the job of hospital matron. The main difference between the two jobs was that Mrs Readman would be supervising the care of patients in a hospital and not in their homes.

EAT

The EAT overturned the tribunal’s decision. The tribunal wrongly asked if a reasonable employee would have accepted the job. It should have asked if Mrs Readman had unreasonably refused the job.

Mrs Readman’s desire not to work in a hospital was a sound and justifiable reason for refusing the job. Therefore, she was entitled to a redundancy payment. Since 1985, Mrs Readman had not worked in a hospital because she did not want to do so. Although Mrs Readman may have preferred to “take the money and run” – it was not the main reason why she had refused the job.

Readman v Devon Primary Care Trust [EAT/0116/11]

Opt-out agreements

In Arriva London South Ltd v Nicolaou [EAT/0293/11], Mr Nicolaou was a bus driver who worked an average of 38 hours per week. His employer introduced a policy that it would not offer any overtime to a bus driver unless they signed an opt-out agreement.

Mr Nicolaou claimed that he had been subjected to a detriment because he had not signed an opt-out agreement. The EAT disagreed.

The reason why Mr Nicolaou was not offered any overtime was in order to implement a policy. The policy complied with reg. 4(2) of the Working Time Regulations (WTR) – because it was a reasonable step to ensure - that Mr Nicolaou did not work more than an average of 48 hours per week.

Comment

Was a blanket ban on overtime a reasonable step under reg. 4(2) of the WTR? Mr Nicolaou worked an average of 38 hours per week. Therefore, the employer could have complied with reg. 4(2) of the WTR by allowing Mr Nicolaou to work an average of 10 overtime hours per week.

Tribunal awards will increase from 1 February 2012

From 1 February 2012, tribunal awards will be increased by the Employment Rights (Increase of Limits) Order 2011.

The main increases are:

• The maximum amount of a week’s pay will increase from £400 to £430.
• The maximum compensatory award for unfair dismissal will increase from £68,400 to £72,300.

• The daily limit on a guarantee payment will increase from £22.20 to £23.50.

What can a worker claim for a breach of a contractual disciplinary procedure?

The Supreme Court has ruled that a worker cannot claim damages for their employer’s failure to follow a contractual disciplinary procedure [CDP] – if the worker's loss was a result of their dismissal.

However, a worker can make such a claim - if their loss was a result of their employer’s conduct before the dismissal – and the conduct did not form a part of the dismissal process.

Edwards v Chesterfield Royal Hospital NHS Foundation Trust & Botham v Ministry of Defence [2011] UKSC 58

Comment

Although a breach of contract claim in relation to a CDP will only succeed if the claim falls outside of the "Johnson exclusion area" [see para. 50] - a disciplinary procedure should clearly state that it is non-contractual – in order to avoid such claims.

TUPE

An employee’s dismissal by an administrator was automatically unfair – because it was connected with a TUPE transfer - although the transfer had not been contemplated - or a transferee had not been identified - at the date of the dismissal.

The Court of Appeal approved the EAT’s decisions in the Harrison Bowden and Morris cases. And it disapproved the EAT’s decision in the Ibex case [see para. 49].

Spaceright Europe Ltd v Baillavoine [2011] EWCA Civ 1565