These seminars are aimed at anyone who deals with employment law on a day to day basis, including HR managers and HR directors. At these events we present an overview of what we consider to be the most significant cases decided in 2014, and what they teach about managing your workforce – together with our practical tips. Also hear about what is coming up in 2015, and how you can get ready for what will be another busy year in employment law. Topics that are covered include: • changes to TUPE • changes to flexible working • shared parental leave • the holiday pay cases • equal pay audits • social media • zero hours contracts • discrimination update • what’s coming up in 2015.

1. Employment law update 2015

2. TUPE 2014 changes

3. TUPE 2014 Regulations
• The latest amendment to the 2006 TUPE Regulations
came into force on 31 January 2014
• Significant but not ground-breaking changes
• Changes limited to Great Britain – Northern Ireland
remain on the old rules for now.

4. Key changes and recent case law
Key areas of change:
• Service provision changes
• Changes to terms and conditions
• Collective agreements
• Unfair dismissal
• Changes in workplace location
• Redundancy
• Employee liability information
• Information and consultation rights.

5. Service provision changes
For TUPE to apply, the activities before and after transfer
should be “fundamentally the same”.
This change reflects existing case law on the meaning of
‘activities’ so there is no real change in effect.
Costain Ltd v Armitage (2014)
A project manager who spent the majority of his time working
on a transferring contract was not necessarily assigned to the
‘organised grouping of employees’. EAT held that time spent is
just one of several factors – “requires proper examination of
whole facts and circumstances”

6. Changes to terms and conditions
The general rule is that changes to contracts will be void where
the sole or principal reason for the change is the transfer.
Contracts can be changed in any of the following circumstances:
• The reason for the change is unconnected to the transfer
• By agreement with the employee, when the sole or principle
reason is an “ETO reason entailing changes in the workforce”
• The contract terms allow such a variation
• Where the changes are entirely beneficial for the employee.

7. Changes to collective agreements
• Transferee employers can change terms derived from
collective agreements 1 year after the transfer, as long as
the overall change is no less favourable to the employee
• Negative changes to collective terms can be offset by
offering positive changes to other terms and conditions
• Transferee employers are not bound by terms in collective
agreements which are negotiated after the transfer, if the
transferee is not party to the collective agreement
• Particularly relevant where a unionised workforce is taken
over by an employer which does not recognise the union.

8. Unfair dismissal
• If the sole or principal reason for dismissal is the transfer,
the dismissal will be automatically unfair
• However if there is ‘an economic, technical or organisational
(ETO) reason entailing changes in the workforce’ then it will
be potentially unfair
• Dismissals where the reason is connected with the transfer
are no longer automatically unfair.
Hazel and anor v Manchester College (2014)
Court of Appeal held that two employees who refused to take
a pay cut were unfairly dismissed as no change in workforce.

9. Changes in workplace location
• An ‘ETO reason entailing changes in the workforce’ now
includes a change to the place of work
• Where an employee refuses to relocate and resigns, claiming
unfair dismissal, such dismissal is no longer automatically
unfair and may be treated as place of work redundancy
• This is a welcome development for employers as it reduces
the risk of automatic unfair dismissal on a change of location
which often accompanies outsourcing transactions.

10. Redundancy
• 2014 Regs also make changes to the Trade Union and Labour
Relations (Consolidation) Act 1992 (TULRCA)
• Pre-transfer consultation can take place where:
– there is likely to be a relevant transfer
– the transferee is proposing to make 20 or more employees
redundant at one establishment within a 90 day period
– one or more of the transferring employees are likely to be
affected by the proposed redundancies.
• Transferee employer must notify the transferor employer in
writing and the transferor must agree to start to consult.

11. Employee liability information
Employee liability information includes:
• Identity, age, employment particulars and disciplinary and
grievance records of transferring employees
• Details of any collective agreements
• Details of outstanding claims against outgoing employer.
This information must now be provided minimum 28 days prior to
transfer, rather than 14 days prior.
Eville and Jones (UK) Ltd v Grants Veterinary Services Ltd (2014)
Transferor employer ordered to pay £65k compensation for
failure to notify transferee of potential claims by employees.

12. Information and consultation
requirements – micro businesses
Under the new rules a micro business, which has fewer than 10
employees, does not have to elect representatives for the
consultation process.
They must still inform and consult directly with all staff about
the transfer.

13. Changes to flexible working

14. Flexible working
• Since 30 June 2014 the right to request flexible working has
been extended to all (eligible) employees
• Employers must consider requests ‘in a reasonable manner’
• ACAS code of practice available “Handling in a Reasonable
Manner Requests to Work Flexibly”.

15. Eligibility
• Request must be made by an employee, not worker
• Any employee can apply, not only those with caring
responsibilities
• Employee must have 26 weeks’ continuous service
• One application in any 12 month period.

16. Types of changes
Flexible working requests can cover:
• change to hours, e.g. part-time, compressed
• change to times when they are required to work
• change to the place of work, e.g. working from home.

17. Process
• Employee makes written request, detailing:
– Date
– That the application is made under the statutory
procedure
– Details of how the employee wants to work flexibly and
from when
– Explanation of how flexible working might affect the
business and how this could be dealt with
– State whether they’ve made a previous application.
• Employer must deal with the request in a “reasonable
manner”

18. Dealing with the request
• Examples given in ACAS Code include:
– Holding a meeting to discuss the request, allowing the
employee to be accompanied
– Assessing the advantages and disadvantages of the
application in line with business requirements
– Offering an appeal process
– Considering a trial period.
• Notify the employee of a decision in 3 months
• If agreed, employer must:
– Write to confirm agreed changes and start date
– Formally change employee’s terms and conditions.

19. Refusing the request
8 fair reasons to refuse requests are set out in legislation.
Consider the potential risk for discrimination
• Risk of claims, particularly for those with protected
characteristics under the Equality Act
• The HR policy should state that each case is considered on its
merits
• For competing requests, employers should consider the risk of
a claim before deciding whether to refuse any of the requests
• Maximum compensation for employee – 8 weeks’ pay.

20. Shared parental leave

21. Shared parental leave
• New entitlement, in force from 1 December 2014, applies for
children born/adopted on or after 5 April 2015
• No changes to existing maternity leave, pay or allowance
• Derives from leftover maternity leave/pay – mother must
curtail her maternity leave
• Maximum 50 weeks’ leave can be shared between parents
• Eligible mothers can end maternity leave early and share
leave and pay with child’s father/partner
• Continuous or discontinuous blocks of leave.

22. Eligibility
• Applies where there is shared responsibility for bringing up a
child – not necessarily a “couple”
• Only applies to employees, not workers
• The employee must satisfy the continuity of employment
test
• Partner must satisfy the employment and earnings test
• Mothers who are entitled to maternity leave will be entitled
to shared parental leave.

23. Shared parental pay
• Maximum shared parental pay (SPP) = 37 weeks
• If mother qualifies for SMP, she will qualify for SPP
• Available to the mother and the child’s father/mother’s
partner
• SPP is capped throughout, whereas SMP is enhanced at 90%
of actual pay for first 6 weeks
• Employee must exceed lower earnings limit in ‘relevant
period’.

24. Notification requirements
• All notifications must be in writing (email is ok if agreed)
• Employee submits Notice of Curtailment (NoC) giving 8
weeks’ of the intention to curtail maternity leave
• NoC usually accompanied by Notice of Entitlement (NoE)
which is notice of the intention to take SPL, including a
declaration from employee and partner
• NoE can be accompanied by Notice of Booking Intention (NBI)
indicating when leave will be taken
• A Booking Notice (BN) must be submitted 8 weeks’ prior to
required leave – employee is entitled to submit 3 BNs.

25. Taking SPL
• Leave can be taken as a continuous block (single event) or
discontinuous blocks (multiple leave periods)
• Employers cannot refuse a request for continuous leave, but
can refuse discontinuous leave after a 2 week discussion/
consideration period
• Employees on SPL can work up to 20 ‘SPLiT’ days – how these
days are paid is to be agreed with the employer
• Can use a combination of SPLiT days and flexible working to
minimise disruption for employer of multiple leave periods
• On return from SPL, employee has same rights as returning
from maternity leave re going back to the same job.

26. Considerations for employers
• Develop a policy that sets out rules and procedures for
taking shared parental leave
• Consider whether to go beyond statutory entitlement for SPP
• Policy should cover how you will deal with non-compliance
with notice requirements and guidelines for use of discretion
• Consider how you will deal with unusual circumstances
without setting a precedent
• Uncertainty over employee status in between discontinuous
periods of leave, e.g. are they protected from redundancy?
• Information must be communicated to employees before
April 2015.

27. Holiday pay

28. Background – ECJ case law
• Working Time Regulations 1998 (WTR) – annual leave paid at the rate
of a week’s pay; “normal remuneration”
• Bamsey v Albion Engineering & Manufacturing (2004) – ECJ held that
guaranteed overtime is part of normal working hours
• Robinson-Steel v RD Retail Service Ltd (2006) - ECJ held that paid
annual leave should be “normal remuneration”
• Williams & others v British Airways (2011) – ECJ held “remuneration
intrinsically linked to performance of employment contract”
• Lock v British Gas Trading Ltd (2014) – ECJ held that holiday pay
calculation should include commission payments.

29. UK tribunal cases
• Neal v Freightliner Ltd (2013) – ET held that voluntary overtime
payments should be included in holiday pay calculation
• Fulton and another v Bear Scotland Ltd (2013) – ET held that
regular overtime, standby and emergency call out should be
factored in
• Wood and others v Hertel (UK) Ltd (2014) – ET held that holiday
pay should include compulsory but not guaranteed overtime and
productivity bonuses.
The employers appealed…

30. EAT judgment
Much awaited judgment of EAT in conjoined cases of Bear
Scotland and Hertel handed down 4 November 2014:
• Non-guaranteed overtime to be included in holiday pay
calculations
• No judgment on voluntary overtime as yet
• Failure to pay correct rate of holiday pay is an unlawful
deduction under Employment Rights Act 1998
• Back-dated claims limited where more than 3 months has
elapsed since last incorrect payment.

31. What next?
• Unite not appealing EAT decision on back-dated claims
• Claimants can add new claims by amendment
• Government to amend regulations to prevent claims to
Employment Tribunals going back more than 2 years
• Lock v British Gas Trading to be re-heard at Leicester
Employment Tribunal in February 2015; further guidance on
the appropriate reference period for calculating holiday pay
may be given.
What should employers do?

32. Equal pay audits

33. Equal pay audits
• Came into effect 1 October 2014 through new regulations
• Employers who lose an equal pay claim will be required to
carry out an equal pay audit, unless exceptions apply
• Exemptions for micro-business (fewer than 10 employees) and
new businesses (less than 12 months old)
• Audit must ensure a review of pay policies and structures and
action plan to address discriminatory pay differences
• Tribunal determines if the audit complies
• The employer must then publish the audit.

34. Social media

35. Social media
Two aspects to consider:
• Protecting the employer – appropriate HR policies and
contracts
• Use of social media during recruitment and online
monitoring
Preece v JD Wetherspoon (2011)
Dismissal for making abusive comments on Facebook was fair.
Company policy expressly prohibited writing on blogs and
Facebook where company’s reputation could be damaged.

36. Misuse of social media
Game Retail v Laws (2014)
Employee registered a private Twitter account which he also
used to monitor activity on individual store Twitter accounts.
The employee posted offensive tweets; dismissed for gross
misconduct.
• EAT upheld employer’s appeal; re-affirming the appropriate
test was whether the decision to dismiss fell within the
‘range of reasonable responses’
• Question was whether employer was entitled to conclude
that the offensive material might have caused offence
• Cases will always be fact-sensitive.

37. Misuse of social media
Atkinson v Community Gateway Association (2014)
A had used the company email system to send highly personal
emails with sexual content to someone outside the company.
The emails were used as evidence for disciplinary proceedings.
A resigned and claimed constructive dismissal.
Question was whether the employee’s Art 8 rights had been
breached by the employer’s accessing of his emails:
• Emails sent from work could fall within Art 8
• Depends on facts in each case; look at email policy
• Policy was clear - A could have no expectation of privacy
therefore no breach of his Art 8 rights.

38. Pre-employment checks
Using social media is often a standard part of background
checks run on prospective candidates
What are the issues?
• Pre-employment discrimination
• Employee’s data protection rights or privacy
• Information obtained on the internet may not always be
accurate

39. Employee monitoring
• Types of monitoring - emails, internet and telephone usage
• Monitoring employees vs right to privacy
• Legal framework
• The importance of having a relevant policy - what information will
be accessed and why
• Monitoring – what, why, how?
– The purpose must be clearly identified and justified
– Is monitoring the only way to achieve this purpose?
– Carry out impact assessments and record process.

40. Best practice
• Ensure HR policies are clear on employee use of social media
accounts and the consequences of mis-use
• Employees or candidates must be informed of background
searches and checks that employer proposes to undertake
• Ensure any searches are proportionate
• Contractual provision re post-termination restrictions to
prevent solicitation and dealing with employer’s contacts
• Consider adding a clause to employment contract giving
company proprietary interest in the employee’s LinkedIn
contacts.

41. Zero hours

42. Zero hours contracts
• What is a zero hours contract?
• Why are they used?
• Estimated 3-4% of workforce on zero hours contracts – esp. in
health and social care, hospitality and administration
• Uncertainty for employees and exclusivity clauses considered
unfair
• Huge response to government consultation.

43. Zero hours contracts
• High profile – unions and campaigning groups involved
• Forthcoming cases
– Sports Direct
 Legal settlement reached on high-profile test case –
zero-hours contracts and job adverts to be re-written
 300 claims from former and current workers for
exclusion from company bonus scheme.

44. Zero hours contracts
• Government response to consultation on zero hours contracts
- Small Business, Enterprise and Employment Bill
• Bill expected to receive Royal Asset in late March 2015
• Would amend Employment Rights Act 1996 to define zero-
hours contracts and render exclusivity clauses unenforceable
• Bill does not address concern about unregulated use of
contracts and impact on workers
• EU Commission has launched a consultation on the Working
Time Directive, which includes the use of zero hours
contracts.

45. Discrimination update

46. Statutory paternity pay
Shuter v Ford Motor Co Ltd (2014)
ET held employer did not discriminate by paying statutory
paternity pay when female employee on maternity leave would
be entitled to full basic pay. No direct discrimination as the
appropriate (hypothetical) comparator was a woman who had
also taken APL e.g. female partner who would have been
treated the same way
Note context that Ford’s overall policy objective to recruit
and retain women

47. Obesity
Kaltoft v Municipality of Billund (2014)
• ECJ handed down judgment on 18 December
• Although no general principle of non-discrimination due to
obesity, in certain circumstances an employee may be able
to show they are “disabled” as a result of their obesity
• Where the obesity is long-term and hinders full and effective
participation in professional life
• ‘Mere’ obesity is insufficient to fulfil criteria in ECJ case law
• Employers may be under a duty to make reasonable
adjustments.

48. Caste discrimination
Chandok v Tirkey (2014)
The claimant, an Indian domestic worker, alleged discrimination on
the basis of race and religion, as well as reliance on Ms Tirkey’s low
status in the caste system. The EAT considered that the term “ethnic
origins” in the Equality Act 2010 has a “wide and flexible scope”
which could include caste.
• Caste discrimination is not yet expressly prohibited by EqA
• Claimants must still rely on ethnic or national origins, but this is
likely to develop further with case law
• UK consultation on specific caste discrimination delayed – doubts
whether legislation will change before May election.

49. Pregnancy discrimination
Lyons v DWP Jobcentre Plus (decision 2014)
EAT held that a woman dismissed after several months off sick with
post-natal depression after maternity leave was not discriminated
against because of pregnancy or sex
• Pregnancy discrimination (s.18 Equality Act 2010) only occurs
where a woman is treated unfavourably during the “protected
period” of pregnancy and maternity leave
• Following ECJ decision in Brown v Rentokil Ltd a woman is not
necessarily discriminated directly because of sex where she is
dismissed because of pregnancy-related absence where her
maternity leave has ended
• Sex discrimination only occurs if sick woman is treated less
favourably than a sick man would be.

50. Reasonable adjustments
Dominique v Toll Global Forwarding Ltd (2013)
• EAT held employer failed in its duty to make reasonable
adjustments when it did not adjust certain redundancy criteria
which placed a disabled employee at a substantial disadvantage.
• This was despite it would have made no difference to the eventual
decision to dismiss the employee.
• Where link between reasonable adjustments required and
disadvantages considered, failure to comply with duty to make
reasonable adjustments is relevant when considering justification
for indirect discrimination and claims for discrimination arising
from disability.

51. Reasonable adjustments
London Borough of Southwark v Charles (2014)
• EAT upheld decision that an employer failed to make reasonable
adjustments for a disabled employee in a redundancy exercise
• Employee’s disability meant he was unable to attend administrative
meetings (including interviews)
• Tribunal found employer failed to consider alternative ways of
assessing his suitability for roles into which he might have been
redeployed as an alternative to redundancy.
• Requirement to adjust interview for a role does not lead automatically
to the conclusion that the employee would have been appointed.
• Here employee could have been interviewed at home or provided info
in advance as part of less formal process.

52. Age discrimination
• Government is to roll out an ‘older workers’ champion
scheme from April 2015
• Scheme will offer intensive work support with ‘career
review’ and digital support to address skills gaps
• ‘Older worker’ champions will link with SMEs to encourage
them to hire older workers and tackle outdated stereotypes.

53. Other updates

54. Disciplinary sanctions
McMillan v Airedale NHS Foundation Trust (2014)
Where there is no express provision in the contract, contractual
disciplinary procedures will not be interpreted to give
employers the right to increase sanctions on appeal, e.g.
written warning to dismissal
Consider including an express provision allowing the employer
to increase a disciplinary sanction on appeal

55. Auto enrolment threshold
• Earnings threshold for automatic enrolment into a workplace
pension is to increase for April 2015 – March 2016
• Lower qualifying earnings band will be £5,824
• Upper limit will be £42,385
• Earnings trigger remains at £10,000.

56. Sickness absence
“Fit for Work” phased roll-out from early 2015
• Assessment – referral by GP at 4 weeks of sickness absence
• Advice - for employers, employees and GPs
• Employer concerns:
– Large employers may already have occupational health
services
– Generic occupational health providers
– Usefulness of internet/telephone assessment reports
– Speed of process
– Interaction with in-house occupational health
– Employer’s rejection of return to work plan.

57. Penalties for breaching workers’
rights
• Claims brought from 6 April 2014
• Additional penalty if breach has ‘aggravating features’
– Action is deliberate or malicious
– Employer has a HR Team
– Repeated Breach
• Factors for imposing financial penalty may include size
of business, duration of breach, behaviour of parties.

58. Tribunal fees
• Since 29 July 2013 all claimants have to pay a fee before a
claim can be submitted to the Employment Tribunal
• Fees have had dramatic impact on number of claims
• Lib Dems calling for an urgent review; Conservatives are
committed to a review but no date set
• UNISON’s challenge of tribunal fees dismissed by High Court
on 17 December.

59. What to look out for in 2015?
• Initial opinion from European Court on Woolworths and Ethel
Austin case, brought by USDAW, on meaning of ‘at one
establishment’ for collective redundancies – due in February
• From 5 April, various changes to the adoption leave system
including:
– removal of requirement for 26 weeks' service before
employees become entitled to adoption leave, and
– the right for both single and joint adopters to attend
adoption appointments.
• New tax-free childcare system to be introduced from
Autumn 2015.

60. For more information contact…
James Tait
+44 (0)121 237 3999/+44 (0)7500 041229
James.Tait@brownejacobson.com
Peter Jones
+44 (0)115 976 6180/+44 (0)7798 584829
Peter.Jones@brownejacobson.com