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The law of unintended consequences
One of the Government's proposals for making life easier for small employers is to increase the qualification period for bringing an unfair dismissal claim from one year to two years (Resolving workplace disputes: A consultation January 2011). This looks attractive but ignores the fact that many unfair dismissal claims, such as those linked to discrimination, do not require any period of service at all. If this proposal goes ahead, the likely result is that more claimants without two years' service will simply allege that their dismissal was because of their sex, race, disability etc and is therefore unfair. A tribunal will need to decide whether it was. In the meantime, the employer will have been put to the expense of defending a discriminatory dismissal claim.
Check before you pay out to opportunistic claimants
In order to succeed in a discrimination claim, the claimant must have suffered a detriment. Making allegations on their own is not enough as the case of Berry v Recruitment Revolution and ors 2011 IDS Brief 919 EAT shows.
B was in his mid fifties. He brought a number of employment tribunal claims alleging age discrimination on the basis of job advertisements which appeared to target younger people by using terms such as "school leavers" or "recent graduates." Four of these cases reached the Employment Appeal Tribunal (EAT) on appeal. The EAT had no hesitation in dismissing B's appeals. It was apparent on the facts that he had no intention of applying for any of the jobs, even when, in one of the cases, the recruitment agency had encouraged him to do so.
The EAT noted that in one of the cases on appeal the Employment Judge had said he understood that B had made about 50 such claims and had agreed to many settlements out of court. The EAT pointed out that the 2006 Regulations were not intended to provide a source of income to people making claims when they are not interested in the jobs and those who try to exploit the Regulations for financial gain could be penalised in costs.
Holding religious beliefs is different to manifesting them
The former is protected in law; the latter is not as Power v Greater Manchester Police Authority 2011 IDS Brief 919 EAT, shows.
P, a committed spiritualist, worked for the MPA as a Special Constable Trainer. He was dismissed following complaints about his disruptive and unhelpful behaviour at two separate police establishments before he joined the MPA. During their investigation into the incidents the MPA discovered that before he joined them he had sent posters and DVDs relating to his work as a spiritualist to other police forces.
The MPA's dismissal letter stated among other things that "his current work in the psychic field....is not compatible with employment in Greater Manchester Police." P's appeal against dismissal was dismissed. The Panel held that the posters and DVDs were not appropriate for bringing into police premises. The subject matter was irrelevant but P's actions indicated that he did not understand the boundaries between his personal life and the organisations he was assisting or employed by. The Panel said that the reference in the dismissal letter to P's work in the psychic field related to the inappropriate DVDs and posters; not to his beliefs.
Settling claims through ACAS does not always require formal documentation
When an Acas officer brokers a settlement of a tribunal claim, the settlement terms are usually set out in a document called a COT3. However, all the relevant legislation requires is that an Acas officer has "taken action" to settle the dispute.
What this means is illustrated by Allma Construction Ltd v Bonner [2011] IRLR 204 EAT.
On 20 February AC Ltd made an offer of £1,000 to settle B's unfair dismissal claim. B told his solicitor the offer was acceptable and the solicitor then confirmed this with Acas. An Acas officer left a message with AC Ltd's solicitor telling them that their offer had been accepted. On 23 February B's solicitor phoned Acas to tell them that B had changed his mind. There were further discussions between the parties in which B said he would settle for £5,000. AC Ltd told him that the case had already been settled for £1,000 and applied for his claim to be struck out.
The Employment Judge refused to do so holding that AC Ltd's original offer was incomplete as terms such as pensions and confidentiality had not been agreed and the parties had continued to negotiate after B withdrew his acceptance of the £1,000 offer. There was no binding agreement made under the auspices of Acas and the Acas officer did not think a binding settlement had been reached either.
The EAT allowed the employer's appeal. All that was required by the legislation was for a conciliation officer "to take action" in the dispute. "Taking action" was not defined and had to be given its normal meaning. It covered any action taken by an Acas officer in relation to the claim and its settlement. It did not require the involvement of Acas in the COT3 paperwork. Here there was no doubt on the facts that a contract to settle was concluded on 20 February. An offer to settle had been made and it had been accepted. It did not matter that additional matters were not included.
Beware of contractual pension commitments in TUPE transfers
This is because although occupational pensions are specifically excluded from transferring under the Transfer of Undertakings (Protection of Employment) Regulations (TUPE), a contractual commitment to transfer a pension can transfer to the new employer - Whitney v Monster Worldwide Ltd 2011 IDS Brief 919 CA.
W joined MSLG Ltd's final salary pension plan in 1975. The pension deed provided that payments would be increased having regard to the RPI. In September 1989 MSLG wound up the scheme and scheme members were required to transfer their benefits to a money purchase pension scheme. MSLG gave W and 28 other key staff a "no detriment guarantee" that they would be no worse off on retirement and it would make up any shortfall in payments.
This guarantee was reaffirmed following a share sale. In July 1997 MW bought the business and W transferred to them under TUPE. He was dismissed in December 1997. He was entitled to his pension and claimed that in accordance with the no detriment guarantee the amount should be enhanced so that he received what he would have done under the final salary scheme. MW Ltd disagreed saying he was entitled only to his pension benefits under the money purchase scheme. The CA, upholding the decision of the HC, agreed that W was entitled to the enhanced pension. On the facts, a contract to protect W's pension entitlement had been made between W and MSLG Ltd and it had been confirmed following the share sale. The guarantees were therefore part of W's contract at the time of the TUPE transfer to MW and passed to them under his contract despite the fact that occupational pension schemes did not transfer under TUPE.
Protective awards can be very expensive
A protective award is made by an employment tribunal for failure to consult collectively with recognised trade unions or employee representatives in large scale redundancies or in TUPE transfers. It is up to 90 days pay for each affected employee and the penalty is punitive. So, the tribunal starts at 90 days (even where the consultation period is only 30 days) and only reduces this if there is a very good reason why collective consultation has not taken place.
In Zaman and ors v Kozee Sleep Products Ltd t/a Dorlux Beds UK [2011] IRLR 196, the EAT confirmed that protective awards for failure to consult collectively under TUPE were not capped at the statutory maximum on a week's pay (currently £400). The employees' actual salaries applied. The same applied to protective awards for failure to consult for redundancy