Redundancy

Lecturer made redundant amid role confusion wins £55,000

A former college lecturer has won £55,000 after being told by her employer that it no longer needed somebody to fill the role she was originally hired for. Miss Anderson worked for Shillington College from August 2011 until her dismissal in November 2016, the Central London Employment Tribunal heard.

The background

Shillington College, a graphic design college, has campuses in Australia, the UK and the US. The college employed Anderson initially as a lecturer at its Sydney campus before moving her to Melbourne in 2012. A year later Mr Shillington, the college’s founder and chief executive, approached Anderson and offered her the position of head of teaching in London. Anderson accepted, and was granted a Tier 2 visa. She agreed a salary of £50,000, along with a relocation package, with her new line manager Ms McHugh.

But towards the end of 2013, Shillington and McHugh informed Anderson that she would not be working as head of teaching, and would take the positon of senior lecturer. Anderson was disappointed with this decision, but agreed to the change.

In July 2015, Shillington emailed Anderson about her failure to meet deadlines and alleged decisions to discuss confidential matters with her colleagues, as well as her “poor decision-making.” Shillington also alleged that this was not the first time he had had to reprimand Anderson, and that he was “considering the college’s position” with regards to her role and placing her “on notice” following three warnings.

Later that month Shillington warned Anderson that he believed she had now reached the first stage of the college’s disciplinary procedure. He told Anderson that she could appeal this decision, but she did not.

In early September 2016, after being told that her role would be changing to focus on part-time teaching, Anderson became unhappy with the lack of progress she felt she was making in her career. In October 2016 Anderson raised grievance with McHugh, but this was rejected. Anderson received a letter ten days later notifying her that, because the college no longer required a head of teaching, she was at risk of redundancy.

On 10 November, Anderson raised a complaint about her possible redundancy. On 15 November she was informed that McHugh would hear her grievance outcome appeal, but this was rejected. Anderson was dismissed later that month.

The case

 The Central London Employment Tribunal allowed the claim for unfair dismissal, and the judge claimed that college could not “hide behind its own lack of paperwork or inconsistency” to blur events. Additionally, the tribunal agreed that Anderson had not in fact been fulfilling the role of head of teaching, and was instead working as a senior lecturer.

The tribunal also found that the college had failed Anderson’s inability to meet deadlines, which the tribunal determined was because of a combination of a heady workload and a large amount of students arriving at the college at once. It also stated that this had been exacerbated by both of Anderson’s being hospitalised at the time.

Judge Norris criticised the college particularly for it’s failure to follow disciplinary procedures, which did not make for a “professional or compliant way to go about HR administration”.

What’s next?

 The tribunal’s decision reinforces the need for employers to be able to clearly explain, by reference to contemporaneous documents, how and why an alleged redundancy situation arose, and to follow a full and proper procedure that demonstrates genuine efforts to avoid dismissal.

The ruling emphasises that tribunals do not take an employer’s assertion of a redundancy situation at face value, and will examine the relevant circumstances leading to the dismissal in detail if necessary.

For more HR expertise and advice you can contact Alison here.

 

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Tribunal awards – calculating a week’s pay

In a recent case the Employment Appeals Tribunal ruled that a week’s pay should include employer pension contributions, rather than just basic pay, for calculation of compensation for claims under the Employment Rights Act 1996.

Let’s take a look at the facts.

Ms Drossou (D), who worked for the University of Sunderland, was dismissed on the grounds of an irretrievable breakdown in working relations, of which the University claimed D to be the main cause. Subsequently, D brought a claim of unfair dismissal that was eventually upheld by the Tribunal.

As a result, the EAT ordered compensation from the University, calculating a week’s pay by including the employer pension contributions. On the normal grounds that payments are not paid to the employee but into the pension fund, this decision went against the longstanding practice of excluding employer pension contributions from the calculations of a week’s pay.

The Tribunal felt that this deviation from standard practice was necessary, and said that the law under the Employment Rights Act 1996 (‘the ERA’) does not state that the amount payable by the employer has to be payable to the employee (i.e. it could be payable to a third party such as a pension provider). Additionally, the EAT stated that “remuneration” in the context of the ERA means a reward in return for services, and employer pension contributions are no less a reward for service than basic pay. The University was not satisfied with the ruling, but when it appealed to the EAT the Tribunal’s decision was upheld.

So, what does this mean for employers?

For the time being (at least until we see whether this decision is appealed) employers need to increase their calculations in accordance with the potential value of claims. Employers facing unfair dismissal claims need to be careful. If the claimant’s base salary is below £80,541 – the current statutory cap for unfair dismissal compensation – the calculation of a week’s pay becomes highly relevant. Where the employee earns less than the statutory cap on a week’s pay (currently £489), the basic award will also be increased – as well as all other awards based on the ERA definition such as the eight-weeks’ pay for a flexible working rules breach.

But, more importantly, the decision may impact protective awards. If employers fail to inform and consult under TUPE or, in a redundancy process, under the Trade Union and Labour Relations (Consolidation) Act 1992, then they could face large increases in the total compensation payable. The final amount will depend on the number of affected employees, the generosity of the pension provision and the size of protective award made up to the 13-week maximum. But if each employee has a 10% employer pension contribution and they all get an award of 13 weeks, then the total payable increases considerably.

For more information on this please contact Alison.

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The Supreme Court has ruled that employment tribunal fees are unlawful

The government suffered a heavy defeat on 26th July after the Supreme Court ruled that employment tribunal fees are unlawful and the government will now have to repay up to £32m to claimants, relating to claims dating back to April 2013.

Brought forward by the Unison union Lord Reed, the judgment said that the fees were unlawful because of their effects on access to justice. Introduced in 2013 and costing between £390 and £1200, the fees have been said to prevent access to justice for workers unable to fund their case.

“The making of the Fees Order was not a lawful exercise of those powers, because the prescribed fees interfere unjustifiably with the right of access to justice under both the common law and EU law, frustrate the operation of Parliamentary legislation granting employment rights, and discriminate unlawfully against women and other protected groups.”

While the fees were brought in by the government to reduce the number of malicious and weak cases, after 3 years there had been a 79% reduction in cases brought forward.

Discrimination cases cost more for claimants because of the complexity and time hearings took. The Supreme Court found this was indirectly discriminatory because a higher proportion of women would bring discrimination cases.

Unison general secretary Dave Prentis has said: “This is absolutely a tremendous victory, it’s probably the biggest victory of employment rights in this country.”

So what now?

In order to deal with this massive backlog of repayment and claims the Presidents of the Employment Tribunals have issued Case Management Orders.

The Order states that all cases and applications arising from the Unison case, or applications for reimbursement of fees, shall be made in accordance with administrative arrangements to be announced by the Ministry of Justice and HMCTS shortly… We wait to see what happens next!

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Another salutary tale about references

All companies who hire employees will, at some point, become involved in either giving or receiving references. It can be a bit of a minefield, and a recent case only serves to prove this point.

The recent Employment Appeal Tribunal case of Dr Pnaiser v NHS England and Coventry City Council was real an eye-opener and illustrated why caution should be taken.

What happened?

In short, the claimant, Dr Pnaiser worked for Coventry Primary Care Trust and later her team was moved to Coventry City Council. She spent a couple of years in the role, and had significant periods of absence due to disability-related surgery. As part of the restructure, she opted for redundancy and entered into a settlement agreement which included an ‘agreed reference’. The reference was a few sentences long, made no reference to sickness or absence, and was factual and positive, although very limited.
She later applied for a role at NHS England and supplied references. One referee mentioned the long-term absence and another referee, Mrs Tennant, supplied a standard reference and left a phone number.

Prof. Rashid, who was recruiting for the NHS England role, phoned Ms Tennant and, as a result of the call, withdrew the job offer.

There was some dispute during the Tribunal hearing about what the content of the call had been. It was established that the absences had been mentioned, at least in the context of making it difficult to assess Dr Pnaiser’s performance, and that Ms Tennant did not believe that Dr Pnaiser was suitable for the role.

Dr Pnaiser sued both Coventry City Council and NHS England for disability discrimination.

The Employment Appeal Tribunal decided that both Coventry City Council (through Ms Tennant) and NHS England (through Prof. Rashid) had discriminated against the claimant.

What can we learn from this?

It’s easy to see here where Ms Tennant went wrong. If an employee has left a role in difficult circumstances and a reference has been agreed, it can be dangerous to go beyond that reference. Telephone calls can catch you out, whilst they may seem very informal, they are just as critical as a written reference and can be used in the same way by the new employer.

In terms of being the recipient of a reference, you should be careful if you withdraw a job offer on the basis of any sickness absence in case this relates to a disability.

The importance of HR

Interestingly in this case the HR department of the NHS advised against the withdrawal of the job offer and refused to do it themselves. Having sound HR advice, whether it’s an in-house team or an independent HR advisor, can ensure that you don’t make any of the mistakes we’ve just discussed. For advice on this or any other HR matters, please contact Alison.

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Disciplinary procedures: 10 common breaches of the Acas code of practice

This article is a summary of a piece published in Personnel Today in 2011 and subsequently updated in November 2014. The full article can be seen here.

Employment tribunals will take the “Acas code of practice on disciplinary and grievance procedures” into account when awarding compensation for unfair dismissal. This could increase and award by up to 25% for employers that haven’t followed the code. So where do most employers go wrong?

  1. Not warning the employee of the possible consequences of the disciplinary action. Employees must be given a fair chance to defend allegations properly. Disciplinary action and potential dismissal should not come as a surprise.
  2. Not setting out the nature of the accusations clearly to the employee. The employer should explain the alleged misconduct clearly and should, throughout the disciplinary process, be consistent in what it is accusing the employee of.
  3. Not furnishing the employee with relevant evidence against them. The employee should be provided with all the evidence, typically in the form of witness statements, in advance of the disciplinary hearing, in advance of attending the hearing.
  4. Not operating a system of warnings where appropriate. Whilst some cases may warrant a summary dismissal for a first offence in the majority of minor misconduct cases, a series of warnings before dismissal will be appropriate.
  5. Not allowing the employee to be accompanied at a disciplinary hearing. The Acas code reminds employers of the requirement to allow the employee to be accompanied at a disciplinary hearing. This applies when a worker who is invited by his or her employer to attend a disciplinary or grievance hearing makes a reasonable request for a companion to attend the hearing.
  6. Relying on evidence from one particular source with no corroborative evidence. There may be limited circumstances where one individual’s evidence is enough to lead to a disciplinary sanction, but an employer should always look for more.
  7. The absence of an adequate appeal stage. Employers should give the employee the opportunity to appeal when the outcome of the disciplinary hearing is communicated to them. Appeals should be unbiased and not be a “foregone conclusion”.
  8. Failure to keep clear records of the whole disciplinary process. To stand the best chance of successfully defending employment tribunal claims, employers must keep clear records of each stage of the disciplinary process.
  9. Delays in dealing with disciplinary issues. Most cases should be dealt with in a matter of weeks and unexplained delays in the disciplinary proceedings will always be frowned upon by tribunals.
  10. Having the same person deal with the whole disciplinary process. Ideally, different people should carry out the investigation, disciplinary hearing and appeal stage.

For more advice and support through disciplinary matters, please contact Alison.

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Dismissal and TUPE – a complicated case

In these times of businesses changing hands, merging and being sold, knowing how to handle the human resources issues is more important than ever.

The basic concept of TUPE is that when a business changes hands, the employees of the previous business owner automatically become employees of the new owner. Anyone who is dismissed prior to the transfer of business, for a reason connected with the transfer, will be protected by this area of the law. Such a dismissal will be automatically unfair and liability for the unfair dismissal transfers across to the new owner, even if the dismissal has meant that the employee has not.

If, however, that person should appeal against their dismissal, it would be considered null and void and they would be treated as if they had been employed at the time of transfer. Their employment would transfer to the new owner.

In a recent case, exactly this happened. The claimant was dismissed by the original company for gross misconduct. She lodged an appeal against the dismissal. Meanwhile the first company was sold and the employees entered into a TUPE transfer with a new company. The second company heard the claimant’s appeal and decided that the dismissal was unsafe but did not inform the claimant of its decision or reinstate them. Instead, it instructed an employment consultant to negotiate a settlement agreement (although this never actually happened).

The employment tribunal ruled against the claimant, stating that for unfair dismissal to hold true there needed to be a clear decision. Because of subsequent discussions they felt it was not clear and they could, therefore, not rule to reinstate the claimant. They did, however comment about the fact the internal appeal ruling was not communicated to the employee.

When this case went to the Employment Appeal Tribunal, however, they allowed the claimant’s appeal, ruling that once an appeal against dismissal is upheld the contract of employment is automatically revived. There is no need for a separate reinstatement decision or communication of that decision. The Claimant was therefore employed at the date of the TUPE transfer and entitled to pursue her claim against the second respondent.

The message for employers is to be careful about engaging in anything concerning TUPE without the support of a qualified human resources professional. For more advice on this or related matters, please contact Alison.

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Redundancy does not require a reduction in work or headcount

A recent court case highlighted the fact that when making a redundancy the business does not necessarily need to have had a reduction in work or need a reduction in its number of employees.

Legislation states that employees must be selected for redundancy in a fair way, only taking into account their level of experience and capability to do the job. The employer must also have a legitimate reason for making the redundancy, which could be; the business is changing what it does, the business is doing things differently (using machinery etc.), or the business changing location or closing down. UK law also states that the employer must try to find suitable alternative employment within its organisation before resorting to redundancy measures.

The case that has recently brought redundancy laws into question involved a claimant whose job title was HR Administrator/ PA to the CEO. Following a reorganisation, the employer decided to create two new posts – HR advisor and PA to the CEO, to replace the claimant’s role. Both of these new roles required different skills to those possessed by the claimant and she was unsuccessful in her application for the PA role, therefore the decision was taken to make her redundant.

The claimant believed that she had been a victim of unfair dismissal and argued that the work she had previously carried out still needed to be done; therefore there was no reduction in the amount of work. However, the EAT dismissed the appeal stating that the claimant had misread the statutory definition of redundancy and that redundancy isn’t dependent upon a reduction in work load or headcount, but a reduction in the employer’s requirements for employees to do a specific type of work. This reduction can be actual or anticipated and still be grounds for fair redundancy dismissal.

In this case the tribunal proceedings concluded with the verdict that the decision to make the claimant redundant was fair even though there was not a reduction in the amount of work. In fact, the amount of work had increased warranting the creation of two separate roles; however, the claimant didn’t possess the required skills for either of the new roles and so was declared redundant.

For more information on the redundancy processes see the Government guidelines or contact Alison@enlightenhr.com.

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