Employment news round-up, June 2016

Aside from the EU referendum, what other important developments have affected the employment law world this month?

30/06/2016

Aside from the EU referendum, what other important developments have affected the employment law world this month? Although June has been a bad month for the EU, it has been a good month for consultations, with three important new consultations launched. Ill health absence has been back in the news and in the courts this month, and whistleblowing is under the spotlight again. Employment tribunals have announced that they will be publishing decisions online, and a new report criticises the introduction of fees. Jodie Sinclair reports.

Bevan Brittan on Brexit

Please click here for our full briefing on the employment law implications of the result of the referendum on leaving the EU. Please click here from an update from our data protection team on the implications for information law, particularly in the context of the General Data Protection Regulation.

Working time breaches – no injury to feelings awards

The EAT has held, in a case called Gomes v Higher Level Care Limited, that compensation for injury to feelings is not available for a failure to provide rest breaks under the Working Time Regulations 1998. The correct focus for an employment tribunal is solely the employer's conduct, and any economic loss sustained by the worker. However, workers who suffer injuries resulting from a breach of the Working Time Regulations 1998, including psychological injuries, may pursue a claim in the civil courts, where more compensation may be available.

Off-payroll working in the public sector - consultation

HMRC has published a consultation document outlining its proposals for reforms to the IR35 rules for workers who provide their services to the public sector through an intermediary, such as a Personal Service Company, a limited company or a partnership. Under the proposed new rules, the public sector engager (or, if a third party is involved, that third party) rather than the intermediary will be responsible for deciding whether the IR35 rules apply and, if they do, for calculating, reporting and paying tax and national insurance contributions (including employer NICs) to HMRC. HMRC has proposed a simplified process to determine whether the new rules apply.

The consultation documentation is available here. The closing date for comments is 18 August 2016, and it is envisaged that the new rules will apply from April 2017.

However, it is not clear whether the changes will apply only to contracts entered into (or renewed) after that date or to all contracts in place on that date. At present, the changes do not apply to the private sector, but it is thought likely that this could be the next step.

Local Government Pension Scheme – consultation

A second significant consultation has been launched in recent weeks: the Department for Communities and Local Government is seeking views on the proposal to extend the 'Fair Deal for Staff Pensions' to employees in local government who are transferred under outsourcing arrangements.

The 'Fair Deal' arrangements require that contractors must provide public-sector pensions for transferring employees on public-sector outsourcings, but it currently excludes transfers from local authorities because the same principles are covered by the Best Value Authorities Staff Transfers (Pensions) Direction 2007. The consultation document from the Department for Communities and Local Government includes amending regulations to create a system of "protected transferees" and "protected transferee employers". The employees will remain as Local Government Pension Scheme members for as long as they remain wholly or mainly employed on the delivery of the service or function transferred. The employer will be required to participate in the LGPS to facilitate that membership. However, the draft regulations do not include a requirement that, at re-tender, the formerly transferred member becomes a protected transferee member and the successful bidder becomes a protected transferee employer.

The consultation documents can be found here and the consultation closes on 20 August 2016.

Ill health dismissals

In the same week in which it has been reported that GPs would like the government to extend the period after which a sick note is required from one week to two weeks, it has also been reported that the Acas Code of Practice on Disciplinary and Grievance Procedures does not apply to ill health dismissals. The Employment Appeal Tribunal said that Code applies to issues of employee culpability and, in this case, the only question in issue was whether the employee was fit to do his job. For more information, please click here for the full judgment of the Employment Appeal Tribunal on this question.

Please note, however, that the Acas Code is likely to apply if sickness absence is linked to a disciplinary issue – for example, if there is doubt about the legitimacy of the employee's illness or if the employee has committed a serious breach of absence policy or procedure.

Whistleblowing law is inadequate…

This is the view of a new report published by international NGO Blueprint for Free Speech and the Thomson Reuters Foundation. The report argues that UK law is not effective in stopping whistleblowers from being targeted, and lacks effective penalties for managers and co-workers who retaliate against whistleblowers. The report outlines 20 reforms, ten of which it says are urgently needed, which would help to improve the situation for whistleblowers in the UK. Key recommendations include

  • a new government agency responsible for whistleblowing with enforcement powers (including the administrative power to grant whistleblowers protected status before retaliation occurs);
  • a legal duty on employers to put written whistleblowing channels in place;
  • a cheaper and simpler tribunal process;
  • changes to the burden of proof;
  • civil or criminal penalties for victimising whistleblowers; and
  • more effective prohibition of gagging clauses in settlement agreements.

It remains to be seen how many of these proposals will find their way onto the statute books, but with whistleblowing very much in focus at the moment, we could see strengthening of these protections in the near future. This would come hot on the heels of the recent run of cases which suggest that the judiciary is adopting a low threshold for the 'public interest' aspect of whistleblowing – as explained by Victoria McMeel in our recent briefing, Whistleblowing Takes Centre Stage. Please click here for further information on how we can assist you with implementing a whistleblowing culture and defending whistleblowing claims.

Access to justice and ET fees

The House of Commons Justice Committee has published a report on employment tribunal fees, which indicates that they have had an unacceptable impact on access to justice. The report is also critical of the government's failure to meet its own deadline of providing a report on employment tribunal fees by the end of last year. The Justice Committee's report concludes that the introduction of issue and hearing fees has caused a dramatic drop in claims, and has failed to encourage settlement because there is a lack of incentive for employers to resolve claims before they reach an employment tribunal.   The Justice Committee has made a number of recommendations, including

  • a reduction and restructure of fee arrangements (to include a single fee or a three tier structure; or a level of fee proportionate to the claim, with no fee payable for claims below a certain level)
  • reform of the remission system
  • special rules for women alleging maternity or pregnancy discrimination.

Please click here for a copy of the full report.

Employment tribunals online

It has been announced by HM Courts and Tribunals Service that it intends to introduce an online database of employment tribunal decisions. It is expected that the database will be available in Autumn 2016. However, it is not yet known whether the database will include pre-existing decisions or whether it will be limited to those decisions made after the database has gone live. Although employment tribunal decisions are not binding, it will be useful to have access to this information as it may give an indication of how another employment tribunal may approach cases based on similar facts. At present, it is only possible to obtain paper copies of employment tribunal decisions, by making an application to the Bury St Edmunds employment tribunal.

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