Sintons Employment Law E-Bulletin – Issue 65

• An individual can be liable for a whistleblowing dismissal – Timis v Osipov [2018] EWCA Civ 2321
• An employer can be vicariously liable for injury caused at an impromptu afterparty following the Christmas party – Bellman v Northampton Recruitment Ltd [2018] EWCA Civ 2214
• Annual leave does not accrue during parental leave, when the contract of employment is suspended – Tribunalul Botosani v Dicu (Case C-12/17) EU:C:2018:799
• Government publishes a Statement of Changes to the Immigration Rules HC1534
• It is not always necessary to hold a meeting with an employee before dismissing them for some other substantial reason – Hawkes v Ausin Group (UK) Ltd UKEAT/0070/18/BA
• Reduction in Apprenticeship Fees
• Changes to the National Minimum Wage

An individual can be liable for a whistleblowing dismissal, along with the employer – Timis v Osipov [2018] EWCA Civ 2321

The Claimant was dismissed on the ground that he had made protected disclosures. This was on the recommendation of two of the Respondent’s directors. The Tribunal held that he had been unfairly dismissed contrary to s103A of the Employment Rights Act.  However, the Respondent became insolvent so the Claimant sought to claim against the directors personally.

The Tribunal held that the conduct of the directors had subjected the Claimant to a detriment contrary to s47B(1A) of the ERA as that section prohibits not only the employer, subjecting a worker to a detriment, but also its workers. In turn, the directors were deemed to be jointly and severally liable along with the Respondent and were ordered to compensate the Claimant for his losses.

This decision was upheld by the EAT and subsequently by the Court of Appeal, who ordered the directors to compensate the Claimant for the losses flowing from the dismissal that they had recommended.

Under s47B(2), no claim can be made for detriment where it amounts to dismissal under Part X (Unfair Dismissal) of the ERA. However, a fellow worker or agent may still be liable for a detriment that results in a dismissal, and in turn the employer would be vicariously liable for that under sub-section 47(1B), despite what is said in s47B(2).

An employer can be vicariously liable for injury caused at an impromptu afterparty following the Christmas party – Bellman v Northampton Recruitment Ltd [2018] EWCA Civ 2214

Mr Bellman, a sales manager for the Respondent, was attacked and severely injured by the company’s managing director, Mr Major, at an impromptu drinking session following their Christmas party.

The managing director had arranged taxis to the afterparty and the drinks were mainly paid for by the company. During this afterparty, an argument broke out concerning the placement and terms of one of the Respondent’s new employees. The managing director, while giving a lecture on his authority, was questioned by the Claimant. Things became heated and Mr Major punched the Claimant, causing brain damage.

It was held at first instance that the company was not vicariously liable for the injuries as the managing director was not acting in the course of his employment. However, the Court of Appeal disagreed. In arriving at its decision, it found that there were two key matters to be considered, they were:

1. The nature of the employee’s job – to be construed broadly and objectively; and
2. Whether there was sufficient connection between his job and the wrongful conduct to render vicarious liability appropriate.

Significantly, in this case, Mr Major was the owner of the Respondent company and its most senior employee. Consequently, he had full control over how he conducted himself in his role as managing director. It was held that when he was lecturing his employees at the afterparty, Mr Major was acting in his role as managing director and seeking to establish his authority in said role.

In addition, the afterparty was not simply a standalone social event that happened to involve work colleagues, but a continuation of an organised work Christmas party, largely paid for by the company. As such, the Court of Appeal held that there was sufficient connection between the conduct of Mr Major and his role as managing director, thus finding the company vicariously liable for his actions.

Annual leave does not accrue during parental leave, when the contract of employment is suspended – Tribunalul Botosani v Dicu (Case C-12/17) EU:C:2018:799

In Tribunalul Botosani v Dicu, the employee was entitled to 35 days of annual leave, based on the number of days she had worked that year. Ms Dicu took a period of maternity leave, then parental leave, followed by annual leave. However, her employer refused to grant her 5 days’ leave as they argued that this had not accrued, as parental leave was not a period of actual work.

Both the Working Time and Parental Leave Directives were considered by the Court. It was held that the right to annual leave presupposes that the worker was actually at work. Yet for other purposes, such as sick and maternity leave, this is not presupposed. However, this can be justified as sick leave is not usually foreseeable, and out of the worker’s control, and maternity leave protects a special situation and relationship.

This decision was reached as the Parental Leave Directive enables Member States to define the status of the employment contract during periods of parental leave. In the Member State in question, Romania, the contract was suspended during this period. As a result, the CJEU held that periods of parental leave were not periods of work for the purposes of the Working Time Directive.

It should be noted that the position in the UK is that during periods of parental leave, the contract of employment still exists but in a limited form. As a result, workers will continue to benefit from the accrual of statutory holiday entitlement under the Working Time Regulations during periods of parental leave. However, they will not benefit from any contractual holiday arrangements as the limited form of contract that exists in accordance with the Maternity and Parental Leave etc Regulations does not entitle workers to any such arrangements.

Government publishes a Statement of Changes to the Immigration Rules HC1534

This was published on the 11 October 2018 and the proposed key changes which may affect businesses and migrant workers are:

• It is no longer necessary for applicants to submit passport-size photographs with their application, although their photograph will still be taken as part of the biometric enrolment process. Also, paper form applications will now only be used if the application is being submitted by post. Furthermore, applicants who wish to submit their applications on a “same day” basis, using the Premium Service Centre will have to do so online.
• Copies, rather than originals, of supporting documents such as payslips and bank statements are now permitted.
• Provided that the correct fee has been paid and proof of identity provided, applications that would otherwise be invalid can now be treated as valid. The Secretary of State will now have the power to treat incomplete applications, and those submitted on the wrong form as valid. The ten working days presently allowed to correct a mistake will also be able to be extended.
• Greater discretion will be granted to those assessing applications under the points based system:
  • Officials will be able to request specified evidence from applicants who have omitted said evidence entirely from their application. At present, this is only possible if the first and last documents have been provided but a sequence of documents in between are missing.
  • Additional requests can now be issued as many times as necessary, rather than only once.
  • Officials will be able to grant applications where a specified document is omitted or submitted incorrectly, if the missing information is verifiable in another way based on the other documents provided.
  • B. documents will not be requested if the application would fail even if they were provided.

It is not always necessary to hold a meeting with an employee before dismissing them for some other substantial reason – Hawkes v Ausin Group (UK) Ltd UKEAT/0070/18/BA

The Claimant, a reservist with the Marines, voluntarily signed up for a 7-week overseas call up. Under his contract of employment, he was entitled to one week’s unpaid holiday per year to take part in his reserve duties. The Claimant informed his employer that he wished to take 7 weeks’ leave in order to fulfil his call up. Upon finding out that the Claimant had signed up voluntarily, the Respondent decided that they did not wish him to proceed with it.

Upon hearing that the Claimant had chosen to go, despite the voluntary nature of the call up, the Respondent invited him to a meeting and summarily dismissed him. The EAT held that as the reason for dismissal was some other substantial reason, rather than misconduct, it was not strictly necessary for the employer to hold a meeting to “consider the explanations”, and the Tribunal was open to find that any such meeting would not have changed the employer’s position.

Therefore, the process followed by the employer was not necessarily unfair. Please note that it should not be assumed that Tribunals will follow this decision in future due to the rather specific and unusual nature of the facts.

In hindsight, the Claimant may have been better placed had he exercised his rights under the Reserve Forces (Safeguard of Employment) Act 1985, non-compliance with which carries criminal penalties.

Reduction in Apprenticeship Fees:

Philip Hammond announced in his recent Budget speech that the fee that SMEs must pay when taking on apprentices will be halved from 10% to 5% of the pay bill from April 2019.

This reduction comes as part of a “£695 million package to support apprenticeships.”

It is not yet clear whether the change will apply to those employers who are affected by the apprenticeship levy (those with a pay bill over £3 million), once their levy pot is empty.

It was also announced that up to £5 million will be provided to the Institute for Apprenticeships and National Apprenticeship Service in 2019-20, in order to “identify gaps in the training provider market and increase the number of employer-designed apprenticeship standards available to employers”.

These changes should be welcomed by SMEs and hopefully enable smaller businesses to begin offering more apprenticeships.

Changes to the National Minimum Wage:

The Chancellor also announced the new National Minimum Wage rates to come into effect from April 2019, they are:

• Apprentices – £3.90 per hour (up from £3.70)
• Under 18s – £4.35 per hour (up from £4.20)
• 18 to 20 – £6.15 per hour (up from £5.90)
• 21 to 24 – £7.70 per hour (up from £7.38)
• 25 and over – £8.21 per hour (up from £7.83)

Employers should bear the new rates in mind and take steps to prepare for the implementation of the changes in April 2019.