Our aim is to keep you up to date with key developments in employment law so that you can manage your business better. Please note that the Newsletter is for information only. It is not intended as legal advice and must not be read as such.

If you have any comments on anything in this newsletter or would like help and advice on employment law or HR matters, employment law training or need a mediator to help with employment, commercial or neighbour disputes, please do not hesitate to contact us.

Let's get rid of human rights?

Much pontificating has gone on of late about recent decisions based on the European Convention of Human Rights allowing prisoners to vote and sex offenders to appeal against being on the sex offenders register for life. These may be extreme examples but there is a fundamental principle at stake here: if we want to live in a society governed by the rule of law, we have to obey the law. The European Convention on Human Rights is part of our law. Laws in democracies are administered by independent judges who apply the law as laid down by the legislatures and courts; they do not do the bidding of the government of the day. We may not like some of the judges' decisions; if so we can try to change them through legal means. This is not the position in countries such as Russia and most countries in the Middle East and Africa where the rule of law does not reign supreme. People there who want to stand up for their human rights or those of others risk imprisonment and even death. In an interview in 1988 Margaret Thatcher said, "The freedom of peoples depends fundamentally on the rule of law." Wise words which we ignore at our peril.

Has the Government deliberately changed the rules on the default retirement age?

Most of us know that the default retirement age of 65 goes on 1 October 2011.

Until the Employment Equality (Repeal of Retirement Age Provisions) Regulations 2011 were laid before Parliament last week, most of us had thought that provided employers gave at least 6 months notice of intended retirement to an employee aged 65 or over before 6 April 2011 and the employee duly retired by 30 September the employer was still able to rely on the default retirement age protection from unfair dismissal and age discrimination claims.

However, the Government has either deliberately moved the goal posts or made a serious drafting error. This is because the Regulations provide that the transitional provisions apply only to employees who "will attain" the age of 65 between 6 April and 30 September. So it is not permissible lawfully to retire an employee who is already 65 or over before 6 April.

Small consolation that employers are allowed to give 12 months notice of intended retirement to employees whose birthdays fall during the transitional period and still retain the default retirement age protection even though they may not retire until April 2012.

However, rumour has it that the Government will amend the Regulations to get back to where we all thought we were. So, watch this space!

An agency worker who looks like an employee can still be an agency worker

This was the position in Tilson v Alstom Transport [2011] IRLR 169.

T was an agency worker working for Alstom. He was fully integrated into Alstom's workforce to the extent that he could recruit permanent employees, discipline and dismiss Alstom's permanent staff, order materials and represent Alstom when negotiating contracts. He had a company phone, computer and internet access and had to apply to his line manager before taking leave. Alstom did offer to take him on as an employee but he refused because he thought he was better off financially as an agency worker.

Alstom summarily terminated its relationship with T after he had worked for them for 2 years. He brought an unfair dismissal claim. He lost it because he was held not to be an employee and only employees are eligible to bring unfair dismissal claims. An individual cannot be an employee unless they have an employment contract. The Court of Appeal said that there was no direct contractual relationship between T and Alstom and neither was there a need to imply an employment contract between them to make their relationship work. T was an agency worker throughout the time he worked for Alstom.

Cost can justify age discrimination but only if there is something else

This is illustrated by Woodcock v Cumbria Primary Care Trust [2011] IRLR 119. The NHS in Cumbria was being reorganised. As part of this W's job as the Chief Executive of the North Cumbria PCT would disappear. His contractual notice period was 12 months. He knew he was at risk of redundancy from February 2006 when he was seconded to a temporary role. He failed to get any of the new chief executive posts and was formally placed at risk of redundancy on 11 August 2006. However, he remained on secondment and did a series of projects.

The relevant HR policy provided for an "employment guarantee period" up to 30 June 2007. The policy also provided that for employees with 12 month notice periods notice should be given to expire at the end of the guarantee period. W was not given such notice and was not invited to attend a redundancy consultation meeting until 30 March 2007. The purpose of the meeting arranged for 10 April was to discuss whether he should be dismissed for redundancy. There were problems with this date and subsequent ones and the meeting was not held until 6 June 2007.

The Trust then realised that W would be 49 on 17 June and if he was given 12 months notice of dismissal after that date he would still be employed after his 50th birthday which would entitle him to take early retirement on enhanced terms costing the Trust between £500,000 and £1,000,000 to fund an early retirement pension. The Trust therefore gave W 12 months notice of dismissal on 23 May in advance of the consultation meeting unless he found alternative employment during this time.

At the meeting on 6 June, W protested that it was pointless as he had already been given notice of dismissal. No alternative employment having been found W's employment ended at the expiry of his notice period. His redundancy payment was £220,000.

W brought an age discrimination claim. The Employment Appeal Tribunal (EAT) agreed with the tribunal that giving W notice before the consultation meeting was potentially direct age discrimination but this was justified on grounds of cost and to prevent him from receiving a windfall in the form of the early retirement pension. The EAT said that W had known he had no job since early 2006 and the fact that he had remained employed for so long was indeed a windfall. In reality, the meeting on 6 June would have made no difference to whether or not W was given notice of redundancy and the Trust was justified in accelerating his dismissal.

Redundancy - to bump or not to bump that is the question

In a redundancy situation, where more than one employee is at risk at redundancy the employer has to choose a pool of employees from whom to select for redundancy. "Bumping" in redundancy-speak means making an employee whose job is not at risk redundant in favour of another employee whose job is at risk. This is sometime permissible and, as Fulcrum Pharma (Europe) Ltd v Bonassera and anor 2011 IDS Brief 918 shows, may even be required for a redundancy dismissal to be fair.

B started working for FP as an HR Executive/Office Manager in June 2006. She had responsibility for all HR matters and a team of 5 or 6 administrative staff. By the end of June 2006 as a result of growth in the company B gave up her supervisory duties and became HR manager with no reporting staff. In mid-2008 C joined the HR function as HR Executive to support B. Later in 2008 B suffered a heart attack requiring surgery. She was off work until February 2009. C took on some of her responsibilities during this time. Soon after B returned FP said it was making redundancies. As part of this it had decided to reduce the HR function and retain only the Executive role carried out by C.

In April 2009 FP placed B at risk of redundancy and told her that there were no suitable alternative vacancies for her. B told FP at a meeting that she thought both she and C should be in the redundancy pool and both placed at risk. B suggested C should be made redundant as she, B, had more experience and had also done the role. She said she might consider working a 4-day week on a pro rata salary. However, FP went ahead as it had originally planned and made B redundant whilst retaining C. FP said that it would use external HR advice for more complex issues. B claimed she had been unfairly dismissed.

The EAT agreed with the tribunal that she had been. FP had been wrong to conclude without meaningful consultation on the size of the pool with B that it should be restricted to one person. Neither had FP properly considered the possibility of a pool of two.

Can oil rig workers be required to take their holiday only while on field breaks?

Yes, said the Court of Session in Russell and ors v Transocean International Resources Ltd and ors [2011] IRLR 24.

R and his colleagues were offshore workers employed on oil rigs. They worked a pattern of two weeks offshore and two weeks onshore (field breaks) when they went home. They knew at the beginning of each year that they would have their 26 weeks onshore taken in 13 two-week blocks. While on field breaks, they were not required to carry out any of their contractual duties although on occasions they were required to attend training, appraisals or medical examinations.

Transocean refused to grant their request to take holiday during their offshore time on the rigs. R and the others claimed that this was breach of their right to take holiday under the Working Time Regulations. The employers said that the field breaks of 26 weeks to which the workers were entitled under their contracts were more than sufficient to cover the holiday requirements of the Working Time Regulations. The EAT agreed. The situation was analogous to that of teachers where the requirement to take holiday only during school holidays satisfied the requirements of the Working Time Directive as there would easily be four weeks during these holidays where the teacher was free from work commitments.