Sintons Employment Law E-Bulletin – Issue 59

• Claimant can be awarded costs for work undertaken before they have received the Respondent’s ET3 – Sunuva Ltd v Martin UKEAT/0174/17
• Expectation that an employee works long hours was a PCP – United First Partners Research v Carreras [2018] EWCA Civ 323
• Claimants cannot be awarded compensation for injury to feelings under the Working Time Regulations 1998 – Gomes v Higher Level Care Limited [2018] EWCA Civ 418
• Consultation on new national minimum wage and national living wage rates now open – Low Pay Commission

Claimant can be awarded costs for work undertaken before they have received the Respondent’s ET3 – Sunuva Ltd v Martin UKEAT/0174/17

The Employment Appeal Tribunal (“EAT”) held costs incurred for work carried out, on the Claimant’s behalf, prior to the Claimant receiving the ET3 from the respondent, are recoverable and the tribunal’s power to award costs is not limited to those that are caused by unreasonable conduct.

In the course of a restructure, the Respondent, Sunuva Ltd, decided, prior to any consultation process, that the Claimant would be made redundant and thus devised and operated a selection process to ensure that she would be selected for redundancy. In April 2016 the Claimant instructed solicitors to write a letter before action in relation to her view of the ‘sham’ redundancy process, asserting unfair dismissal and discrimination on the ground of sex, attached to which were legal costs. The claim was presented in August 2016 alleging unfair dismissal, unlawful deduction from wages, sex discrimination and victimisation. The Respondent filed and served the ET3 in October 2016, denying that the redundancy procedure was unfair and in effect denied the redundancy selection outcome had been predetermined.

The Respondent’s witness confessed during oral evidence, on the fourth day of a five-day trial, that despite the redundancy pool and selection process, there had never been any prospect of anyone else being selected for dismissal, other than the Claimant, and the outcome to the redundancy selection exercise had been predetermined.

Costs of around £17,000 were awarded (£4,695 related to work carried out before receipt of the ET3), on the basis that although the Claimant had brought other claims, without the unfair dismissal claim, limited costs would have been incurred. The Respondent appealed on the basis of the EAT decision in Health Development Agency v Parish [2004] IRLR 550 that costs should not be awarded in respect of work prior to receiving the ET3 as there must be a causal relationship between the conduct of a party in bringing or conduct proceedings and the costs awarded.

The appeal was dismissed and the costs order upheld. The EAT noted that the definition of costs in the Employment Tribunals (Constitution & Rules of Procedure) Regulations (“Tribunal Rules”) 2013 is not limited to those incurred at a particular stage in proceedings, provided the party is legally represented or preparing for the claim themselves. The EAT also confirmed that the decision in McPherson v BNP Paribas (London Branch) [2004] ICR 1398  whereby Mummery LJ (paragraph 40) said under the Tribunal Rules 2001, rule 14 ‘does not impose any such causal requirement in the exercise of the discretion’, remained good law despite the change of wording in the Tribunal Rules 2013.

This case illustrates that the tribunal’s discretion is not limited to a particular part of the proceedings and where successful, Claimants may be able to recover costs for work carried out in advance of receiving the ET3.

Expectation that an employee works long hours was a PCP – United First Partners Research v Carreras [2018] EWCA Civ 323

For the purposes of a claim for disability discrimination based on failure to make reasonable adjustments, the Court of Appeal has upheld the Employment Appeal Tribunal’s decision (“EAT”) that an expectation for a disabled employee to work long hours amounts to a provision, criterion or practice (“PCP”).

The Claimant in this case, Mr Carreras, was employed as an analyst for United First Partnership Research, the Respondent, and regularly worked long hours. He suffered a serious bike accident, resulting in several weeks off work and on his return continued to be affected by physical and psychological symptoms from the accident, including difficulty concentrating and working late in the evenings.

For the first six months after the Claimant returned to work, he worked a shorter day. However, over time, he came under pressure to work later; initially as a request which then progressed into an assumption he would do so. The Claimant felt he might be made redundant or lose his bonus if he did not work late. After four months of pressure to work later, he objected to working late in the evenings due to tiredness and was told by a business owner that if he did not like it, he could leave. The Claimant resigned and brought unsuccessful claims in the Employment Tribunal (“Tribunal”) for unfair constructive dismissal and disability discrimination, alleging that the Respondent had failed to make reasonable adjustments to the requirement to work long hours which the Claimant argued amounted to a PCP.

The Tribunal accepted that the Claimant was disabled for the purposes of the Equality Act 2010 but held the requirement to work long hours as the PCP, had not been made out and thus the Respondent had not failed to make reasonable adjustments. In relation to the constructive dismissal claim, the Tribunal held that although cumulative conduct of the Respondent gave rise to constructive dismissal, the Claimant did not resign in response to those breaches.

On Appeal, the EAT overturned the Tribunal’s decision on both claims. The Court of Appeal has now upheld the EAT’s judgment, largely on the same grounds, that the Claimant had resigned in response to the repudiatory conduct, confirming that the Tribunal had wrongly rejected the claims and had adopted too narrow an approach to its interpretation of the term ‘required’.

This case illustrates the broad nature of the concept of a PCP, demonstrating that for the purposes of a reasonable adjustments claim, an expectation or assumption that certain hours are worked is sufficient for a PCP to be established, even where there is no express requirement. Employers must be diligent in identifying PCPs and ensure that reasonable adjustments are made where necessary to avoid claims for disability discrimination.

Claimants cannot be awarded compensation for injury to feelings under the Working Time Regulations 1998 – Gomes v Higher Level Care Limited [2018] EWCA Civ 418

The Court of Appeal has confirmed the Employment Tribunal (“Tribunal”) and Employment Appeal Tribunal decisions that no compensation for injury to feelings can be awarded under the Working Time Regulations 1998 (SI 1998 No. 1833) (“WTR”).

The Claimant worked for Higher Level Care Limited, the Respondent, providing accommodation and support services for vulnerable young people. She filed her claim in the Tribunal, claiming compensation for failure to allow her rest breaks, alleging this damaged her health and well-being. The Tribunal found the Claimant had not been allowed her rest breaks of twenty minutes in shifts of over six hours’ duration, as required by Regulation 12 WTR, and was awarded £1,220 under Regulation 30(3)(b) WTR for pecuniary loss. However, the parties disagreed about whether the Tribunal had jurisdiction to award compensation for injury to feelings. This contention was rejected and the Tribunal held that there is no power to make such an award in cases of this kind. On appeal to the EAT and subsequently the Court of Appeal, this decision was upheld.

The Court of Appeal agreed with Slade J’s view in the EAT that the wrong complained of was akin to a breach of contract. The House of Lord’s judgment in Dunnachie v Kingston Upon Hull City Council [2004] UKHL 36 was considered on the basis that an award for injury to feelings was refused in relation to unfair dismissal claims. The Court of Appeal dismissed the appeal and confirmed that the natural remedy in this case was for payment of compensation for the time worked, in absence of twenty minute breaks, of which quantum was agreed in the Tribunal.

It is now clear that Employers are not liable to pay compensation for injury to feelings where they have breached the WTR in relation to rest breaks and compensation that can be awarded under Regulation 30(4) WTR.

Consultation on new national minimum wage and national living wage rates now open – Low Pay Commission

The Low Pay Commission (“LPC”), an independent body monitoring the impact of minimum wage, has opened a consultation for views on national minimum wage and national living wage rates, including views on the rates that should apply from April 2019.

The consultation also address whether a higher minimum wage rate for hours not guaranteed by an individual’s contract should be introduced, in addition to suggestions for alternative means to tackle ‘one sided flexibility’ that can arise in uncertain and unpredictable work schedules, as part of the recommendations made by the Taylor Review in July 2017.

The consultation closes on 1 June 2018, with a view to recommend the new rates in October 2018 for the government’s consideration. The national minimum wage and national living wage rates are normally increased in line with the LPC’s recommendations.

Furthermore, a separate review of the minimum wage structure is being undertaken by the LPC to cover youth rates of minimum wage and the Apprentice Rate, in line with significant changes to apprenticeship policy in England.

The LPC would like evidence to advise on the best path towards the ‘on target’ rate for 2019, currently around £8.20, and evidence of the impact of national living wage increasing since its introduction.

The new minimum wage and living rates apply from 1 April 2018, so employers must ensure steps have been taken to increase pay accordingly. If you would like to get involved and try to have an impact on the 2019 rates or for more information please click here.