Be Aware - November 2021
Members may have seen in the news that the Government has launched a consultation on making flexible working the default position when an employee starts employment. The present rules on flexible working require employees to have a 26 week qualifying period before making application for flexible working. Under the Government proposals, they are considering whether to make that a right from day one.
Under the present law, provided the employer goes through the procedure properly, it can reject a flexible working request for up to 8 statutory business grounds which are set out in the legislation. Again in this area, the Government is reviewing those rights to refuse and also consider whether or not they should require employers to consider alternatives when turning down any request.
In a separate but related development, the Government also confirmed it’s wish to introduce a “day one” right to carer’s leave consisting of 5 working days unpaid leave per year for employees managing long term caring responsibilities alongside work.
The consultation on flexible working closes on the 1st December 2021, so keep an eye on the news after that date for the final form of the proposals and potentially a timetable on when they may come into law. If as anticipated, there are changes, then employers will need to review their flexible working policies.
“I have an employee whose attitude and performance are poor. Rather than taking the employee through a capability procedure can I explore with the employee whether he/she would be open to mutually agreed termination by agreeing a settlement package with them? Is it safe for me to initiate settlement discussions with the employee in this instance?”
Section 111A of the Employment Rights Act 1996 provides that any evidence of pre-termination negotiations is inadmissible as evidence before a Tribunal in any unfair dismissal claim. These discussions are often described as ‘protected conversations’.
For example, you may offer a settlement agreement to an employee who has been the subject of previous disciplinary proceedings and whose behaviour has not improved. When the employee receives the offer he/she may immediately resign and seek to claim unfair constructive dismissal on the basis that the offer breached the implied term of mutual trust and confidence. If S111A applies the employee will not be able to refer to the discussion in which the offer was made before the Tribunal.
S111A protection only applies where the employee is complaining of ‘ordinary’ unfair dismissal. The protection of S111A does not apply to claims for automatic unfair dismissal e.g. where an employee alleges that dismissal occurred for a reason relating to their pregnancy or trade union membership. In addition, there is no S111A protection for any other claim e.g. breach of contract or discrimination.
ACAS have published a helpful guide on settlement agreements including template letters that can be used to initiate settlement discussions under S111A:
The protection in S111A will not apply to its full extent where there is some improper behaviour on the part of the employer or the employee in relation to the settlement negotiations. This includes harassment, bullying and intimidation, including the use of offensive words or aggressive behaviour, criminal behaviour e.g. threat of physical assault, victimisation, discrimination and putting undue pressure on a party (e.g. not giving an employee a reasonable period of time to consider any proposed settlement offer, an employer saying before any form of disciplinary process has commenced that the employee will be dismissed if he/she rejects a settlement proposal, or an employee threatening to undermine an organisation’s public reputation if it does not sign a settlement agreement unless it is a whistleblowing case).
S111A supplements the ‘without prejudice’ rule which by contrast covers any type of claim and which provides that any discussion between an employee and employee entered into on a ‘without prejudice’ basis to settle an existing employment dispute cannot be disclosed in any subsequent legal proceedings.
If in doubt it is always recommended that you use the RMI’s legal advice line and take employment law advice around any settlement discussions.
When considering whether a person is an employee, worker or subcontractor, one aspect of the test is whether the person concerned has to undertake the work personally or whether they can appoint someone else to do it (a right of substitution).
In Stuart Delivery Ltd v Augustine, the Employment Tribunal was asked to consider the case where a courier company had developed a technology platform to allocate delivery slots. In it couriers opted to take ‘ad hoc’ or ‘slot’ deliveries. Where a courier committed to undertake ‘slot’ deliveries they were required to be available in a set place at a set time in return for a fee. Once committed to a slot, a courier was required to be available unless someone else agreed to take it from them. When Augustine (A) sought to bring a case against SD Ltd, the Tribunal had to consider whether this represented an obligation to perform services personally, as required for ‘worker’ status under S.230(3)(b) ERA.
The Tribunal found that the release procedure did not amount to an unfettered right of substitution, as A would only be released from his obligation to undertake the slot if another courier signed up and he had no control over whether this happened. The Tribunal concluded that this was in the fifth category of substitution identified by Sir Terence Etherton MR in the Court of Appeal in Pimlico Plumbers Ltd and anor v Smith, i.e. ‘a right to substitute only with the consent of another person who has an absolute and unqualified discretion to withhold consent’, which is consistent with personal performance.
On appeal, the EAT agreed with the Tribunal’s analysis. On the facts, the Tribunal was right to find that there was no right of substitution or, in the alternative, there was a limited right falling within the fifth category. SD Ltd appealed to the Court of Appeal on the question of A’s right of substitution.
In dismissing the appeal, the Court of Appeal confirmed that the issue for a Tribunal is whether a claimant is under an obligation personally to perform the work or provide the services. It is to be noted that the categories identified in Pimlico Plumbers Ltd are a summary of the principles to be drawn from and not a rigid classification to be strictly followed. The Court of Appeal noted that, in any event, the Supreme Court had subsequently reviewed the correct approach to determining whether a person is a worker in some detail in Uber BV and ors v Aslam and ors.
Going forward, it is unlikely that a simple right to substitute another approved person will not be enough to avoid the definition of a worker where the person remains liable to perform the role if no alternate is found.
A limited right or ability to notify other employees/workers/sub-contractors that a person wishes to be released from an obligation will, in reality, be an insufficient right of substitution to remove from him that obligation to perform his work personally.
Yes, according to the EAT in the case of Stott v Ralli Ltd.
The Claimant was dismissed during her probationary period for poor performance. After dismissal she raised a grievance, claiming that she had been dismissed because of disability and that her employer was aware of her mental health issues. The grievance was rejected, as was a grievance appeal. The employee then brought a claim alleging that her dismissal was discriminatory (she did not have the 2 years qualifying service to claim unfair dismissal) but did not challenge the grievance process. The tribunal held that the Respondent did not know and could not reasonably have been expected to have known about disability when dismissing.
On appeal The EAT held that, on the facts, the case was about the Claimant’s dismissal (and not the grievance). As she had not raised any issues regarding what went on afterwards in the case, the tribunal was entitled to consider if the dismissal only was discriminatory. The tribunal found that the employer is required to have knowledge (i.e. it either knew or ought to have known that the employee had a disability) of a disability prior to dismissal such that the claim should fail on these facts.
This is another victory for common sense and reinforces the position that you cannot discriminate against someone for something you are not aware of. However, the employer was lucky that the Claimant didn’t include any allegations about the grievance process etc as this may have had a different outcome as the employer was aware of disability throughout the grievance process. The EAT distinguished between issues to be considered by a tribunal in an unfair dismissal claim compared to a discrimination claim. For the purposes of an unfair dismissal claim, dismissal is regarded as a process encompassing the appeal stage and outcome. By contrast, where the claim is one of discrimination a tribunal must consider separately the allegations of a discriminatory dismissal and a discriminatory appeal (if raised).
Don’t forget, this advice is general in nature and will need to be tailored to any one particular situation. As an RMI member you have access to the RMI Legal advice line, as well as a number of industry experts for your assistance. Should you find yourself in the situation above, contact us on 01788 225 908 at any stage for advice and assistance as appropriate.