Some key employment law developments of 2015
Wednesday 13th January 2016
As we begin 2016, we review some of the key developments of 2015.
Holiday or headache?
The calculation of holiday pay continued to be problematic for many employers during 2015, with further decisions but a lack of definitive guidance on the practicalities of calculating it. In Lock and ors v British Gas Trading Ltd and anor, the ET, following a decision from the ECJ, held that the UK’s Working Time Regulations 1998 can be read in a way which makes them compatible with EU law. Therefore any “commission or similar payment” which forms part of normal remuneration, must be included in the calculation of holiday pay. However, this applies only to the 4 weeks of leave mandated by EU law and not to the additional UK entitlement of 1.6 weeks. British Gas lodged an appeal which was heard by the EAT in December and the decision is expected early in 2016.
2015 also saw a significant decision in relation to holiday, long term sickness and the ability to carry over unused leave. It has been clear for some time that those unable or unwilling to exercise their right to annual leave due to long term sickness may carry leave over into subsequent leave years, but for how long can they continue to do so? In Plumb v Duncan Print Group Ltd, the EAT held that they may do so for up to 18 months after the end of the leave year in which the unused leave was accrued. The EAT was clear that there is no requirement that such unused leave be carried over indefinitely or that the worker prove s/he was physically unable to take holiday.
In a legislative change relevant to holiday pay, new regulations introduced a 2 year limit on claims for back pay (including holiday pay) made under the unlawful deduction from wages provisions.
Whistleblowing: what does “in the public interest” mean?
2013 saw a key amendment to the whistleblowing legislation and those making protected disclosures must now reasonably believe that the making of such a disclosure is “in the public interest”. This change was intended to close a loophole which allowed workers to rely on the protection of the whistleblowing provisions when complaining about their individual contracts or minor workplace issues.
The EAT in Chesterton Global Ltd v Nurmohamed, addressed the meaning of “in the public interest” after an employee made a disclosure regarding commission payments in circumstances which affected 100 senior managers. The EAT found that his disclosure was “in the public interest” because it affected a section of the public and not just the individual concerned. This is another case to watch out for in 2016 as it goes before the Court of Appeal. In the meantime, the EAT’s decision has been followed in Underwood v Wincanton Plc which involved a complaint about the allocation of overtime by a group of employees.
Equal pay & gender gap reporting
Equal pay issues are still very much at the forefront of employment law and 2016 is likely to be a busy year in this regard. We will see the introduction of mandatory reporting on the gender pay gap for employers with over 250 employees in the private, public and voluntary sectors. Employers are expected to have to provide details of the difference in pay for male and female employees together with bonus comparisons, although the precise requirements are not yet known.
In addition, 2016 is expected to see some major equal pay claims involving both Asda and Sainsbury’s. Both sets of claims involve employees who are arguing that their roles in the retail stores are of “equal value” to those working in the distribution centres.
Collective redundancy consultation
In 2015 the ECJ overturned a controversial EAT decision in USDAW & anor v VW Realisation 1 Ltd & ors involving the closure of the Ethel Austin and Woolworths stores. The EAT’s decision required that, when considering if the duty to collectively consult arose, an employer must look at the number of redundancies across its entire organisation and not at its individual stores or sites. In a decision welcomed by employers, the ECJ disagreed, holding that Woolworths was correct to regard each store as a separate “establishment” and therefore it had not been necessary to collectively consult with stores that had less than 20 employees. This is a significant decision for those employers operating multiple sites but careful consideration is still needed when evaluating what constitutes a separate establishment.
The end of 2015 saw another development in the long running case of USA v Nolan. The UK Supreme Court held that the US Government was, when closing a US Army base in Hampshire, subject to the collective redundancy consultation. During 2016 the Court of Appeal will examine the timing of the consultation. The case will consider whether employers must consult when considering making a decision which will give rise to a proposed collective redundancy or just about the consequences of that decision once made.
2016 may well see an interesting debate in the area of indirect discrimination. Currently under section 19 of the Equality Act 2010, when bringing a claim for indirect discrimination a claimant must share the same protected characteristic as the group allegedly disadvantaged by the provision, criterion or practice (“PCP”) being relied upon. However, during 2015 there was European case law (although not an employment case) which suggests that section 19 may well be incompatible with EU law.
An ECJ decision (CHEZ Razpredelenie Bulgaria AD v Komisia za zashtita ot diskriminatsia) extended the reach of associative discrimination so that it was not necessary for the claimant to have the same characteristic of the disadvantaged group but just that she suffered the same disadvantage as a result of her association with the group. In this case, an electricity company had a policy of placing electricity metres at an inaccessible height in a particular geographical location mainly populated by Roma, because of a problem with illegal tampering. This policy was said to be a PCP disadvantaging the Roma community. The claimant lived in this area mainly inhabited by Roma, but she herself was not Roma. This is potentially an extension of the associative discrimination principle laid out in Coleman v Attridge which involved a case of direct disability discrimination in which a mother was held to have suffered less favourable treatment because of her son’s disability.
Shared parental leave
April 2015 saw the introduction of shared parental leave. Intended to provide increased flexibility for parents, SPL allows for the transfer of part of the 52 weeks of maternity/adoption leave entitlement to the other parent. Parents may take SPL at the same time, thereby allowing families to spend time together after a birth or adoption. In addition, the scheme allows parents to take leave in multiple blocks, allowing them to stop and start leave, returning to work in between. There are eligibility requirements which employees and their partners must meet and in some case employees will need to consider the impact that utilising SPL may have on enhanced maternity benefits. Employers who offer enhanced maternity leave will need to consider whether they will replicate this for those on SPL.
All information in this update is intended for general guidance only and is not intended to be comprehensive, or to provide legal advice.