An employer was entitled to refuse overtime to a worker who had not signed a working time opt-out.
The Working Time Regulations 1998 ("WTR") implement the European Working Time Directive in the UK. The purpose of the Directive is to protect worker's health and safety.
Under the WTR, an employer must not let their workers' working time exceed 48 hours a week, on average. Breach of this limit can result in criminal liability for the employer. However, the limit does not apply if a worker has signed a voluntary opt-out.
Section 45A of the Employment Rights Act 1996 (ERA) protects workers from being subjected to any detriment by their employer because they have refused to give up a right conferred by the WTR.
Mr Nicolaou was employed as a bus driver by Arriva from 1998 and regularly worked overtime on his rest days. He declined to sign an opt-out from the 48-hour week when asked to do so by his employer. In 2008 Arriva introduced a policy that any worker who had not opted out would not be offered overtime. Mr Nicolaou claimed that denying him the opportunity to work overtime subjected him to a detriment contrary to section 45A of the ERA.
An employment tribunal found that the refusal of Arriva to allow Mr Nicolaou to work overtime on his rest days was a detriment which was caused by his failure to sign an opt-out. Consequently, his claim under section 45A succeeded. However, no compensation was awarded as the tribunal considered that the employer's actions had been reasonable in the circumstances i.e. to avoid a breach of the WTR.
Employment Appeal Tribunal decision
The Employment Appeal Tribunal (EAT) reviewed the proper approach to section 45A claims. It considered that they were akin to victimisation claims and that the employment tribunal had taken the wrong approach in this case. The question was not "but for" Mr Nicolaou's refusal to sign an opt-out would he have been refused overtime but, why did he receive the treatment complained of?
The tribunal had recognised that Arriva's policy was reasonable because its aim was to avoid a breach of the WTR. The EAT agreed and noted that withdrawing the opportunity to work overtime from Mr Nicolaou was simply an implementation of that reasonable policy; it was not action designed to force him to opt out or to penalise him from not opting out.
The EAT was satisfied that Arriva's policy was reasonable and necessary to comply with its statutory duty under the WTR and,
"[T]hat aim may be properly separated from the underlying refusal by the Claimant to sign the opt-out agreement. The necessary link between the Claimant's protected act and the withdrawal complained of is not made out., regardless of whether that withdrawal amounted to a detriment from the employee's point of view."
This sensible decision will come as a huge relief for employers with similar policies. It is helpful to have judicial consideration of the potential conflict between an employee's right not to suffer a detriment and an employer's obligation to comply with statutory obligations.