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October 2021 - Case Law Update

In our final quarterly case law update for 2021, we look at some of the key cases published since July 2021 and consider the lessons we can learn from them.

Furlough and redundancy

As a result of the backlog within the Employment Tribunal system, we are only just starting to see the Tribunal making decisions on the actions taken by employers during the pandemic, specifically in their use of furlough under the Coronavirus Job Retention Scheme (CJRS).

In Mhindurwa v Lovingangels Care Limited, the Tribunal held that an employee was unfairly dismissed where the employer failed to consider using the CJRS as an alternative to redundancy. In contrast, a different decision was made by the Tribunal in Handley v Tatenhill Aviation Limited, where it was held that dismissing an employee despite the presence of the CJRS did not render the dismissal unfair. It is important to note that both decisions are only first instance decisions and therefore are not binding on other Employment Tribunals. However, these decisions do provide an indication as to the approach that Tribunals are taking.

The key difference between the outcome of these cases is that in Mhindurwa there was no consideration by the employer of using the CJRs scheme to see whether work would become available again. Instead, the employer simply decided to proceed with a redundancy process as the work had diminished, the result of which was that Mrs Mhindurwa was made redundant. However, in Handley, the employer initially placed Mr Handley on furlough and, only when it became clear that costs savings needed to be made, subsequently made him redundant.

As such, it appears that where employers have at least considered the use of the CJRS scheme or in fact used it in part, the decision to then dismiss an employee is less likely to be found to be unfair by a Tribunal. Whilst it is now too late for employers to change the decisions that they made during the pandemic, these cases do provide an indication as to the approach that the Tribunals are likely to take, which can assist employers with their strategy in defending claims of a similar nature.

Appeals and unfair dismissal

The Court of Appeal (“CA”) in Gwynedd Council v Barratt and Anor and the Employment Appeal Tribunal (“EAT”) in Moore v Phoenix confirmed that whilst a fair procedure will normally include offering an employee the right to appeal a decision made against them, if an employee is not provided with the right of an appeal it is not always fatal to the fairness of the dismissal. The right of appeal is just one factor that will be considered when assessing fairness. As such, whilst our advice remains that an appeal should always be offered, if, for some reason, an appeal is not offered, it does not necessarily mean that the employer cannot defend a claim of unfair dismissal. As ever, this will come down to the facts of the particular case. For instance, where employees have been fully consulted during a redundancy process and have been able to raise concerns that have genuinely been considered by the employer, it may be that a lack of appeal will not undermine the fairness of the process already followed.

The CA in Gwynedd Council also provides guidance on when employers in redundancy situations may consider the use of interviews during a selection process as opposed to a scoring and pooling process to ensure that a fair redundancy process has been followed. The CA stated that if an employer is simply reducing the number of roles as part of a redundancy exercise, a scoring and pooling process should be used. It is only appropriate to use interviews where new roles that previously did not exist are being introduced and the employer is looking to select employees for the new roles from a group of at risk employees. As such, the judgment shows that in most redundancy situations a scoring and pooling process should still be used.

Dress codes

In IX v WABE eV the ECJ considered whether an instruction by a child day care centre in Germany requiring employees to observe political, philosophical and religious neutrality in order to protect the children’s individual and free development was indirectly discriminatory, in particular in banning the wearing of the Islamic headscarf. IX, who was employed as a special needs carer at the day centre, refused to remove her headscarf and was temporarily suspended and issued with a warning. However, the ECJ held that a ban on wearing any visible sign of political, philosophical or religious belief in the workplace did not constitute direct discrimination provided it was applied in a general and undifferentiated way. In this case, the employer had also prevented another employee from wearing a cross. There was, therefore, no difference in treatment directly based on IX’s religious beliefs. Further, although there might be indirect discrimination this was justified based on the employer’s genuine need to adhere to a policy of neutrality for the benefit of the children in its care.

Whilst this is an interesting case for employers, it should be followed with caution. Although the Tribunals in the UK may have regard to the decision, it is not binding on them and, given current guidance from the EHRC, it is unlikely that a policy of neutrality would provide sufficient justification to an indirect discrimination claim within the UK. Employers should, therefore, carefully review any dress codes to ensure they are proportionate.

Part time workers

The EAT in Forth Valley Health Board v Campbell provided guidance on the difference in treatment between full and part time workers and the Part Time Workers (Prevention of Less Favourable Treatment) Regulations 2000. In this claim, Mr Campbell tried to argue that not receiving paid breaks was unlawful as full-time workers received paid breaks. In the first instance, the Tribunal agreed with Mr Campbell. However, the EAT overturned the decision on the basis that it was not because Mr Campbell worked part time that he did not receive paid breaks but because of the particular number of hours he worked in one shift, with a full time worker doing the same length of shift also missing out on a paid break. The EAT held that in claims of this nature, a “but for test” should be applied, “but for” the employee being a part time worker would the same treatment still be received? If the answer is yes, as was the case here, the employee’s claim will fail.

Privilege

Whilst a detailed consideration of legal privilege is beyond the scope of this update, we do want to bring to your attention the EAT’s decision in Abbeyfield (Maidenhead) Society v Hart. Here the EAT held that an email between an employer and its HR consultant was protected by litigation privilege, and therefore did not need to be disclosed, despite the fact it contained reference to dismissing the employee in question before a disciplinary process had been started. It should be noted that litigation privilege is only engaged in respect of documents produced for the purpose of obtaining information or advice in connection with existing or contemplated litigation. This means that most correspondence between HR and an employer will be disclosable. The EAT also noted that if the email had been between the employer and a lawyer, as opposed to HR, it may have been found to be disclosable if, for example, the advice was being sought on how to act “illegally” such as in respect of a sham appeal process.

Sexual harassment

Last but by no means least, the Government has finally published its long-awaited response to its 2019 consultation on measures to combat sexual harassment in the workplace. A link to the Government’s response can be found here (Consultation on sexual harassment in the workplace: government response - GOV.UK (www.gov.uk). Following the consultation, the Government has stated that it intends to introduce a duty requiring employers to prevent sexual harassment. We will comment upon this further, once it is clear what this duty may look like.

Disclaimer

This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.

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