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Employment year summary 2012

Tribunal changes

From 6 April 2012, a series of changes to tribunal claims and procedure occurred which aimed to reduce the burden on employers and modernise the tribunal system.

Unfair dismissal qualifying period

The greatest change was that the qualifying period for bringing an unfair dismissal claim rose from one to two years. The change only affects employees who started employment from 6 April 2012; those employed beforehand continue to require one year’s continuous employment.

Be aware that inventive employees may find other ways to bring a claim (e.g. discrimination/whistle blowing claims, which do not require minimum service). That said this is clearly good news for employers who just need to ensure they follow good employment practice at all times.

Unfair dismissal cases

In most cases, employment judges will now sit alone to hear unfair dismissal cases, rather than with two lay members. The Government's view was that the costs savings of the change would benefit companies and it does seem to be the case that unfair dismissal claims are being listed and dealt with more quickly.

Costs awards

For cases presented on or after 6 April 2012, the maximum costs award employment tribunals can make increased from £10,000 to £20,000. This is likely to be a positive change for employers, as recent statistics show they are ten times more likely to be awarded costs compared to claimants.

Pension auto-enrolment

1 October 2012 saw the launch of automatic enrolment into pensions, which the Government hopes will “encourage” retirement saving by making this compulsory. Auto-enrolment is being implemented over the next five years, in line with company size, but it is never too early to start preparing.

As an example, employers should be thinking about the following.

  • When the duties apply to them.
  • Which employees are eligible.
  • Deciding whether to use NEST or an existing pension scheme. If the latter, check that it meets minimum requirements.
  • Adapting the recruitment procedures to include auto-enrolment and opting-out processes.

Considering a ‘communications strategy’ to update all employees

Employment Law - Case updates

Holiday and sickness — NHS Leeds v Larner

The Court of Appeal in this case clarified the UK's position on whether employers have to provide holiday to staff on sick leave, as follows.

  • When an employee is off sick, they continue to accrue holiday as normal.
  • Employees can choose to take their holiday during a period of sickness.
  • Equally, they can choose not to take holiday when off sick, saving it for when they return. The Employer must then allow the holiday to be taken in the current holiday year, unless it is not practically possible and then the employee must be allowed to carry over such holiday. 
  • If an employee is dismissed before they are able to take accrued holiday, the Employer must make a payment in lieu of such untaken holiday.
  • If an employee becomes ill during or immediately before holiday, and is therefore unable to take this holiday, the Employer must allow them to take the holiday at another time.

However, the Court of Appeal has warned that this position may change in the future due to the large number of cases currently going through the courts.   

Watch this space and think about your attitude and conduct towards such requests.......

Retirement — Seldon v Clarkson Wright

On 25 April 2012, the Supreme Court issued its decision on the justification of age discrimination via a contractual retirement age. In order for both direct and indirect age discrimination to be objectively justified, employers must show it was “a proportionate means of achieving a legitimate aim”. This case gives some guidance on what that means.

The Supreme Court decided that, in seeking to justify the claimant's dismissal at 65, the respondent employer had identified legitimate aims (namely staff retention, workforce planning and dignity). It was noted that discrimination can only be justified by reference to legitimate "public interest" aims, such as "inter-generational fairness" and "dignity" (which these were), rather than aims relating to individual employers, such as cost or competitiveness.

Preparing to compete — Ranson v Customer Systems plc

Please note, most employees do not have to tell their employer about future plans to compete. This high level of obligation only applies when the Employment Contract states such.

In this case, Mr Ranson had been promoted to a senior position after being employed BUT his original contract had not been changed and did not include any restrictive covenants. Both before and during his notice period, Mr Ranson took steps to set up a competing business, including securing clients and mentioning plans to the employer’s contacts.

The Court of Appeal decided that Mr Ranson only owed the standard implied duties to his employer — to do his job faithfully and maintain trust and confidence.  His actions were not sufficient to breach those. The duty of trust and confidence would prevent Mr Ranson from actually competing with his employer whilst still employed, but not from taking preparatory steps to do so. It does not require employees to put an employer’s interests before their own. This case is therefore a strong reminder to ensure all employees have the correct Employment Contract in place.

Sexual Orientation Discrimination Bennett v Bivonas LLP

This case demonstrates that even if an offensive remark is not directed at a particular employee, or intended for them to hear or read, that is no defence to a claim of unlawful discrimination.

Mr Bennett, one of the firm's barristers who was openly gay, accidentally came across a handwritten homophobic remark about him in an archived case file. It had never been intended that he would find or read the note which had been written by another member of the firm.

Mr Bennett was signed off sick the next day and subsequently lodged a complaint that the wording of the note amounted to a homophobic slur against gay men.

Despite the employer's arguments that the note was merely a personal aide-memoire, had not been seen by anyone else, had not been intended for Mr Bennett to read, and so had not caused him any detriment, the EAT took the view that it constituted sexual orientation discrimination against him, and that it made no difference that the author of the note had never intended for Mr Bennett to see it.

Please remember about the importance of Equal Opportunity Policies and Practice. You can never be too professional in terms of your expected standards of behaviour and conduct.

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