Considering ill-health
retirement prior to dismissal
The
Employment Appeal Tribunal (EAT) has confirmed
that where an employer provides an enhanced
pension for ill health retirement, it will be
expected, prior to dismissing an employee for
long-term sickness, to take reasonable steps to
check whether that employee is entitled to the
benefit of ill health retirement. This is in
addition to (i) the general requirement, which
derives from unfair dismissal case law, that an
employer takes reasonable steps to consult such an
employee to find out the nature and prognosis for
his medical condition and to consider alternative
employment; and (ii) the general requirement to
make reasonable adjustments to accommodate
disability.
In
First West Yorkshire Limited t/a First Leeds v
Haigh, after the employee suffered a
suspected stroke, the question of whether the
employee's condition was permanent, and would
therefore entitle him to ill health retirement on
the grounds of permanent incapacity, was never
answered. Whilst the employer's occupational
health adviser had provided a report, he had
written to a specialist for an up-to-date opinion.
The EAT confirmed that the employer should have
waited for that opinion. Without it, there was no
clear evidence either way as to whether the
employee was entitled to ill health retirement.
There was therefore no justification for the
employer's actions when it subsequently forced the
employee to choose between dismissal and forgoing
any right to an enhanced pension.
The
EAT's decision was based, in part, on the
employer's sickness policy which expressly stated
that it would consider retirement along with
termination on medical grounds. The EAT noted that
good industrial practice would require nothing
less in a case where an employee on long-term sick
leave may be entitled to an enhanced retirement
pension on the grounds of ill health. It also
noted that if an employer could proceed to dismiss
a sick employee who might be entitled to an
enhanced retirement pension without considering
that question, substantial injustice might occur.
This
case highlights the importance of ensuring that
all appropriate medical advice is obtained when
dealing with employees on long-term sick leave,
including any potential qualification for ill
health retirement or other benefits. Obtaining
medical opinions and reports may often be
time-consuming and subject to delay. However, it
is vital to chase down and consider all available
options before taking any key decisions when
managing sickness absence.
Protective award - start
at 90 days' pay
An
employer proposing to dismiss as redundant 20 or
more employees at one establishment within 90 days
or less has a statutory obligation to consult
appropriate representatives of those employees.
The consultation period is a minimum of 30 days;
90 days if 100 or more employees are going to be
dismissed. If the employer fails to consult, each
relevant employee can be awarded a "protective
award" of up to 90 days' pay.
In
Hutchins v Permacelle Finesse Ltd (in
administration), the Tribunal originally made
a protective award of 30 days, linking the
protected period for the award and the relevant
minimum consultation period, which in this case
was 30 days. However, the EAT has confirmed that
this was an error of law and that the starting
point for the protective award is 90 days (and the
Tribunal should then work downwards to take
account of any mitigating circumstances). In this
case, there had been a complete failure to consult
and no mitigating circumstances. The EAT therefore
increased the protective award to the maximum 90
days' pay.
TUPE can apply to
offshoring
In
a decision addressing a previously untested issue
in UK case law, the EAT has recently confirmed
that the Transfer of Undertakings (Protection of
Employment) Regulations 2006 (TUPE) do apply to
the transfer of an undertaking from the UK to a
non-EU entity where the business does not remain
in the UK after the transfer.
The
EAT was persuaded that the wording of both TUPE
and the Acquired Rights Directive (which is
implemented in the UK by TUPE) is precise and
clarifies that TUPE applies to transfers of
undertakings situated immediately before the
transfer in the UK. It stated that a purposeful
approach also requires that employees should be
protected even if the transfer is across borders
outside the EU.
The
application of TUPE to "service provision changes"
(e.g. outsourcing, re-tendering or insourcing of
services), which was introduced by TUPE in 2006,
was also considered to reinforce the EAT's
decision. The only limitation in this instance is
that there should be an organised group of
employees situated in Great Britain immediately
before the service provision change. The EAT
considered that this provision is clearly aimed at
the modern outsourcing of service provision,
whether inside or outside the EU.
The
EAT confirmed therefore that there is no
limitation which renders TUPE inapplicable where,
after the transfer or service provision change,
the business is situated outside the UK or the
EU. Although the EAT did accept that the
enforcement of an employee's rights in such
circumstances may present a problem, it concluded
that TUPE has the potential to apply to a transfer
from the UK to a non-EU entity in the event that,
upon transfer, the undertaking does not remain in
the UK.
Compensation rates on the
up from 1 February 2008
The
Employment Rights (Increase of Limits) Order 2007
has been published, increasing
compensation limits for a variety of tribunal
awards and other statutory payments from 1
February 2008. The key changes are listed
below:
-
Maximum
basic award for unfair dismissal/statutory
redundancy payment: increasing from £9,300 to
£9,900
-
Maximum
compensatory award for unfair dismissal:
increasing from £60,600 to £63,000
- Maximum
limit on a week's pay: increasing from £310 to
£330
All aboard for national
minimum wage
The
Government has launched a new campaign to boost
awareness of the national minimum wage (NMW) and
help expose cases of underpayment.
The
three-month nationwide campaign was launched this
week with the unveiling of a 'minimum wage
information tour bus'. The '£5.52: Are you
on board?' bus will travel to more than 30 towns
and cities across the UK, providing free help and
information to members of the public, in addition
to access to online and telephone support. It is
estimated that 1 million people in the UK
currently earn the national minimum wage, which
increased in October last year to £5.52 for people
aged 22 and over, £4.60 for 18 to 21 year olds and
£3.40 for 16-17 year olds.
The
Minister for Employment Relations, Pat McFadden
said:
"Every
worker should earn a fair wage for a fair day's
work. We want to make sure workers know their
rights and employers know their responsibilities.
"The
national minimum wage remains one of the most
important new rights introduced by this
Government. Employers who don't pay the minimum
wage are not only cheating workers, they're
undercutting honest businesses. This information
campaign will help provide those most at risk of
underpayment with the advice and support they need
to take action where necessary."
Age discrimination due to
become most common form of
discrimination
According
to reports of a recent survey commissioned by
Croner, age discrimination is fast becoming the
most common form of discrimination, despite only
coming into force in October 2006.
A
survey of just under 2,000 people found that:
- 11
per cent of respondents believe they had been
discriminated against because of their
age
- Age
discrimination is experienced by almost equal
numbers of men and women (11 per cent compared
with 10 per cent)
- Only
3 per cent of respondents felt they have been
discriminated against because of their race or
disability
- Only
2 per cent of employees felt they were
discriminated against because of their sexual
orientation or religion or belief
Commission supports
anti-homophobic hate crime legislation
The
Equality and Human Rights Commission has announced
that it will support the Government's proposals to
make incitement of hatred on the grounds of sexual
orientation a criminal offence.
Trevor
Phillips, Chair of the Equality and Human Rights
Commission, said:
"Incitement
of homophobic hatred goes beyond mere criticism or
what some consider offensive. It's about
stopping the vile words that prompt
violence...It's essential we balance freedom of
speech against any need for anti-incitement
legislation. Having looked at the Government's
proposals we think they have struck the right
balance, the Commission is persuaded the proposals
are fair and needed."
New book - Promoting
Equality and Diversity: A Practitioner's
Guide
Richard
Kenyon, employment partner at Field Fisher
Waterhouse, has co-authored a new book entitled
Promoting Equality and Diversity: A
Practitioner's Guide.
The
book explains the fundamental changes in the
approach to achieving equality and diversity that
are occurring as a result of recent legislation.
It provides a clear and practical explanation of
both good practice and the legislation behind the
new more proactive approach.
The
book is aimed at HR professionals involved in the
management of equality and diversity issues as
well as barristers and solicitors advising on
equality issues in private practice and in-house
within private companies, law centres or public
authorities.
A
short film that accompanies the book can be viewed
on YouTube at http://www.myspace.com/equalityanddiversity.
The
book, written by Richard and Henrietta Hill of
Doughty Street Chambers, has been published by
Oxford University Press. 10 per cent of the
proceeds of the book go to the Stephen Lawrence
Charitable Trust.
If
you purchase this book before 31 January 2008, you
are entitled to a 20% discount. Please contact
us for an order
form.