Employment Law

The Employment Relationship

• Twofold: contractual framework with statutory overlay

• The basic contract: services in exchange for reward

• Statutory rights and protections. The contract is substantially modified by statutory rights: unfair dismissal, discrimination etc.

• Some elements of the contract are dictated by statute: e.g. minimum notice, holidays

The Contract

• There is always a contract, even if it is not in writing

• The written contract is merely evidence (not always conclusive) of the contractual terms

• Employers should provide employees with a written statement of terms within 2 months

• There is a free-standing right to complain to a Tribunal if there is no written contract

Written Contract - Advantages

• Reduces risk of Tribunal claims• Clarity of terms, especially where there are

default statutory terms:– Holidays, notice period, sick pay, mat/paternity

• Opportunity to introduce special conditions– Operational and disciplinary rules– Right to change duties and working patterns

• Some terms MUST be in writing– Right to deduct, certain restrictions on competition

Main Statutory Rights

• Right not to be unfairly dismissed – now mostly requires two years continuous service

• Working Time rights: holidays, hours of work, rest breaks

• Wages protection, minimum wage, rights during notice, sick pay

• Maternity, paternity and parental rights• Discrimination – wide range of protection

Discrimination

• Equality Act 2010: protected characteristics:– Age– Disability– Gender reassignment– Marriage and civil partnership– Pregnancy and maternity– Race– Religion or belief– Sex– Sexual orientation

Discrimination: direct and indirect

• Direct discrimination: less favourable treatment because of a protected characteristic

• Indirect discrimination: a provision criterion or practice (PCP) which is discriminatory in relation to a protected characteristic

• In the case of disability, there is also a duty to make reasonable adjustments. This is an extension of the indirect discrimination rule

Discrimination – reducing the risk

• Check that decisions about employees are not made on the basis of protected characteristics, especially decisions about pay, promotion or dismissal

• Check that PCPs do not adversely affect particular groups: e.g. p/t work and women

• Do you have an up to date equal opps policy?

Ending the relationship

• Three main areas to consider– Potential breach of contract– Unfair dismissal– Unlawful discrimination or breach of some other

statutory right• Breach of contract is usually (but not always)

confined to the value of the notice period• Unfair dismissal, discrimination and other

statutory rights are much more complex

Unfair dismissal

• Two parts: – The reason for dismissal must be a potentially fair reason

as defined by statute– The employer must act reasonably in all the circumstances

• The five potentially fair reasons are– Conduct– Capability– Redundancy– Illegality– “some other substantial reason”

• Employees now need two years service to qualify

Unfair dismissal

• The reasons most commonly relied on are conduct, redundancy and capability

• It is usually a mistake to use redundancy as a disguise for some other reason to dismiss

• Most of the relevant case law turns on whether the employer acted reasonably. Often this is a matter of procedure.

• Tribunal awards for unfair dismissal are usually much lower than people realise

Unfair dismissal – reducing the risk

• Decide as far as possible what the potentially fair reason is/are. There may be more than one in some cases

• Be very wary of dismissing for a protected reason (e.g. whistleblowing)

• Follow the correct procedure. If you don’t have written procedures, seek advice from ACAS or from your solicitors.

Changes to Tribunal rules• Since 2012, Judges sitting alone hear most cases.

Possibly now more focus on procedure• Costs awards more common; not automatic• New regime of Tribunal fees and awards to be

introduced in 2013• It will probably become more expensive for both

employees and employers who are involved in ET proceedings

• Other proposed measures point towards less formal methods of dispute resolution: workplace conversations, etc