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• Employment Update - April 2007

An ET1 cannot be a grievance

In Gibbs (t/a Jarlands Financial Services) v Harris, the EAT confirmed that an employment tribunal claim form could not be relied upon by an employee as his or her written statement for the purposes of the statutory grievance procedures.

Under the statutory grievance procedures introduced by the Employment Act 2002, an employee cannot bring a claim for unfair dismissal in the employment tribunal unless they have first submitted a written statement of their grievance to their employer and given the employer 28 days to respond. The question in this case was whether submitting an employment tribunal claim form (ET1) to the tribunal was sufficient to comply with the statutory grievance procedures.

The EAT in this case held that the statutory structure envisaged a grievance procedure being invoked before litigation is commenced. The employee must give the employer 28 days to respond and it would counter the scheme if the two processes could run in parallel. The EAT noted "the two processes – the litigation process and the pursuit of a grievance – are separate and distinct and call for a separate and distinct approach". Further, an employee could not be said to have sent the ET1 to the employer by sending it to the tribunal since the tribunal were not acting as the employee's agent in sending it on to the employer.

House of Lords hold that "foreigners" are a racial group

The House of Lords recently held in the case of R v Rogers (On Appeal from the Court of Appeal (Criminal Division)) that "foreigners" could constitute a racial group for the purposes of the definition in section 28(4) of the Crime and Disorder Act 1998. As such, it was held that the use of words "bloody foreigners" and "get back to your own country" could transform the offence of using abusive words and behaviour with the intent to cause fear or violence into the racially aggravated form of that offence, contrary to section 31(1)(a) of the Crime and Disorder Act 1998. Although this is a criminal case, the House of Lords gives useful guidance on the extent of a "racial group" in the circumstances of any case.

The House of Lords held that in defining a "racial group" a flexible, non-technical approach was to be preferred. The definition extends beyond a group defined by colour, race or ethnic origin and encompasses both nationality and national origins. The policy objectives behind the offences in the Act, namely to tackle racism and xenophobia, were also held to be relevant in seeking to define a "racial group". The essence was the denial of acceptance to members of a certain group not for their own sake but for the sake of something they could do nothing about. This is just as true if the group were defined exclusively as if it was defined inclusively. Whether the evidence in any particular case, taken as a whole, proved that the offender's conduct demonstrated hostility to such a group, or was motivated by such hostility, is a question of fact for the court or tribunal to determine.

TUPE: Transferee's requirements are irrelevant

The Court of Session held in Hynd v Armstrong and others that when dismissing an employee as redundant prior to a TUPE transfer, a transferor could not rely on the transferee's reduced need for employees to show that the dismissal was for an economic, technical or organisational reason entailing changes in the workforce (an ETO reason).

Morison Bishop (a law firm) had offices in Glasgow and Edinburgh. Mr Hynd was employed as a solicitor specialising in corporate law in the Glasgow office. The partners of Morison Bishop decided to dissolve the partnership with the Glasgow partners forming a new firm called Bishops specialising in property law and litigation and the partners in Edinburgh forming Morisons. The relevant partners of Morison Bishop anticipated that Bishops would have a reduced requirement for corporate lawyers and selected Mr Hynd for redundancy. He was dismissed on the date the partnership dissolved and prior to the transfer to Bishops of the relevant part of Morison Bishop.

Mr Hynd brought a claim for unfair dismissal and, on appeal, the Court of Session held that the tribunal had erred in finding that Morison Bishop had an ETO reason for the dismissal. In deciding whether to dismiss, Morison Bishop should only have taken into account its own requirements for employees and not the fact that its employees may have been surplus to the transferee's requirements. The dismissal was therefore automatically unfair as it had been by reason of the transfer or a reason connected with it.

Atheist teacher discriminated against by Catholic school

In Glasgow City Council v McNab the EAT upheld a tribunal's decision that an atheist teacher employed by a Catholic school maintained by the Council had suffered direct discrimination under the Employment Equality (Religion or Belief) Regulations 2003 when he was refused an interview for the post of Principal Teacher of Pastoral Care. As the post was not on the list of posts for which the Roman Catholic Church required a teacher to be Catholic, the Council should not have assumed that the Church would not have approved the appointment. It was also held that a local authority has no religious ethos and therefore cannot take advantage of the Genuine Occupational Requirement (GOR) defence in regulation 7(3), even in respect of employment in a religious school.

Conduct of a third party cannot be relied upon for constructive dismissal claim

In Yorke and another v Moonlight, the EAT accepted that the conduct of a third party could be relevant in a constructive dismissal case. However, in the present case, the behaviour of the father of the partners in the respondent firm was not the respondent firm's responsibility. The employee had resigned because of the behaviour of the father and therefore her claim for constructive dismissal failed.

Mrs Moonlight was employed by Yorkes of Dundee (a firm) as a shop supervisor. The firm had two partners, brothers, Frank and Grant Yorke. Their father, Mr Yorke had been the previous owner of the business but was no longer a partner of the firm or an employee of the business. However, he was generally considered by the employees of the firm as the "overall boss" and often called in at the shop.

On 13 July 2005, Mrs Moonlight had made arrangements with Frank Yorke to visit her GP in her lunch hour, and had arranged cover for her absence. When Mr Yorke found out about the appointment, he shouted at Mrs Moonlight and told her, "That is no use to me. I have a business to run." When she replied that she was not well, Mr Yorke told her, "Well, if you're not well then just go and go now." On reporting this to Frank, and informing him of how this had upset her, Frank told her that he would look into it and call her the following day. When he failed to do so, Mrs Moonlight resigned, stating:

"I did, in the main, enjoy my work however I feel I cannot continue, following the latest incident resulting in my feeling embarrassed in front of shop staff, personally abused by the tone of voice and language used by your father and confused as to exactly who was my immediate manager."

The tribunal held that Mrs Moonlight had been entitled to resign and treat herself as dismissed by reason of Mr Yorke's "seriously unreasonable" conduct.

The firm appealed and the EAT overturned the tribunal's decision.

The EAT accepted that the conduct of a third party could be relevant in a constructive dismissal case giving the example of an employer who failed without reasonable and proper cause to take reasonable steps to control the behaviour of a third party who repeatedly caused upset and distress in the workplace. Such a failure could amount to a breach of the implied term of trust and confidence. However, on the tribunal's finding, the cause of Mrs Moonlight's resignation was not her employer's conduct or the conduct of a fellow employee for whose conduct her employer was responsible. The EAT rejected Mrs Moonlight's argument that, whilst being neither a partner in or employee of the firm, Mr Yorke had been held out to be in a position of authority and neither she nor other employees had been dissuaded from their belief that they had to follow his instructions. The EAT held that, until she had gauged her employer's reaction, she was unable to assert that they had destroyed trust and confidence.


Laughter by chairman did not indicate bias

Forbes v Robertson v Hendrie is an example of an unsuccessful appeal on the grounds that the chairman of the tribunal was biased. At the hearing of the respondent's application for review of a default judgment, a lay tribunal member in training was present and retired with the chairman at the point of deliberation. Laughter was heard from the chambers during the adjournment. The Chairman and lay member returned and the application to review was refused. The respondent appealed on the grounds of unfairness claiming that the lay member should not have retired with the chairman and that the laughter heard was indicative of his claim not being taken seriously. The EAT held that, even accepting that laughter had been heard, this would not give the appearance of a real possibility of bias to a fair minded and informed observer. The Chairman's decision to refuse the review was upheld.

Equal Pay Claims – the effect of a job evaluation scheme

The latest judgment in the long-running North East equal pay litigation has been handed down by the EAT.

It was held that:

1. Employees whose jobs are rated as equivalent under a job evaluation scheme cannot apply this rating with retrospective effect for six years. The claims arise on the date of the job evaluation study. However, the results of a job evaluation study can be used as evidence in an "equal value" claim.
2. A finding in respect of one comparator does not preclude a claim in relation to another comparator. Each allegation that a comparator is paid more is a separate cause of action and the Claimant is not prevented from having a second bite at the cherry – whether successful or not first time around – with a different comparator.
3. No uplift to compensation should be awarded because of the employer's failure to hold a meeting with individual employees under the statutory grievance procedures. The employees had entered into conditional fee agreements with their solicitors which meant that they could not have settled the claims themselves. Therefore such meetings would have been futile and this amounted to exceptional circumstances allowing for no uplift to compensation.

New evidence requires a restart of the Statutory Dismissal and Disciplinary Procedure

In Premier Foods PLC v Garner it was held by the EAT that the whole disciplinary procedure cannot be looked at as one continuous process in a situation where new evidence comes to light and is taken into account by the employer when increasing the sanction on appeal.

In this case, the employer's internal dismissal and disciplinary procedure allowed the employer to increase (or reduce) the sanction in the event of an appeal. The employee, who had been accused of contaminating a colleague's drink whilst she was out of the room, appealed against a final written warning. On appeal, new evidence was heard that an eye witness (who had also been accused) had seen her contaminate the drink. On the basis of this, the employer increased the sanction to summary dismissal.

The EAT held that the employer should have started the procedure again when the new evidence came to light.

National Minimum Wage increases for October 2007

The Government has announced increases to the national minimum wage to take effect on 1 October 2007. The new rates will be as follows:

Abolition of Statutory Dispute Resolution Procedures

The DTI has launched a consultation with a view to abolishing the statutory dismissal and grievance procedures, introduced in 2004.

The consultation follows the independent review of the employment dispute resolution procedures, undertaken by Michael Gibbons. Gibbons commented "I was struck by the overwhelming consensus that the intentions of the 2004 Dispute Resolution Regulations were sound and there was a genuine attempt to keep them simple. However they have had unintended consequences which have outweighed their benefits."

Key recommendations of the Gibbons Review include:

• the repeal of the statutory dismissal and grievance procedures;
• simplification of tribunal application forms;
• free mediation services provided for employment disputes;
• the abolition of ACAS fixed conciliation periods; and
• the strengthening of the Tribunal's powers to award costs.

Ashfords is regulated by the Solicitors Regulation Authority. The information in this article is intended to be general information about English law only and not comprehensive. It is not to be relied on as legal advice nor as an alternative to taking professional advice relating to specific circumstances.