News Updates

Some key developments in employment law: 2016/2017

Monday 6th February 2017

We review the key developments of 2016 and look forward to upcoming changes.

Employment Status

New working models attempting to depart from the traditional employment structures came under scrutiny during 2016, with the Government launching an inquiry into self-employment and the gig economy. 

In addition, cases testing new working models are now making their way through the ETs. Uber drivers brought claims alleging that they are “workers” for the purposes of relevant legislation, rather than being self-employed and therefore entitled to various employment rights (click here). Uber has appealed.

We have already seen the first 2017 decision in this area with the ET concluding in Dewhurst v CitySprint UK Ltd that Ms Dewhurst, a bicycle courier, was not working for herself, but was a worker and therefore entitled to holiday pay (click here).

The Government inquiry, coupled with the recent cases, mean this is an area which will likely see more developments throughout 2017.

Holiday Pay

2016 saw decisions from both the EAT and the CA in the well-known case of Lock v British Gas Trading Ltd and anor.  The CA confirmed that Mr Lock’s commission must be reflected in the calculation of his holiday pay (click here). As a result, any “commission or similar payment” which forms part of normal remuneration, must be included in holiday pay. This decision only applies to the 4 weeks of leave under EU law and not to the additional UK entitlement of 1.6 weeks. British Gas is seeking permission to appeal, so there may be further developments.

In Brettle & Others v Dudley Metropolitan Borough Council, an ET held that where voluntary overtime payments (including voluntary standby and call out payments) are made with such regularity so as to amount to “normal remuneration” they should be reflected in the calculation of holiday pay.


A significant decision came from the EAT during 2016 when, in G4S Cash Solutions (UK) Ltd v Powell, it was held that the duty to make reasonable adjustments for a disabled employee under the Equality Act 2010 could include pay protection measures, although the EAT recognised this would not be an everyday event (click here).

Another decision from the EAT held that expecting staff to work late could be discriminatory. In Carreras v United First Partners Research, expecting or assuming that an employee will work late can amount to a “provision, criterion or practice” for the purposes of the Equality Act 2010 (click here).  

Two different Advocate Generals of the European Court of Justice in Achbita & anor v G4S Secure Solutions NV andBougnaoui and anor v Micropole SA issued conflicting opinions in cases concerning the dismissal of Muslim women for wearing headscarves in the workplace.  The ECJ is expected to give its judgment in both cases later this year (click here).


In Jhuti v Royal Mail Group Limited the EAT upheld a whistleblowing claim where the person who made the decision to dismiss had been unaware of the protected disclosure. The EAT held that where the decision maker had been manipulated by someone in possession of all the facts, this knowledge could be attributed to the employer.

The EAT in Chesterton Global Ltd v Nurmohamed, addressed the meaning of “in the public interest” after an employee’s disclosure regarding commission payments which affected 100 senior managers. The EAT found that the disclosure was “in the public interest” because it affected a section of the public and not just the individual concerned. The CA’s decision is expected this year.

Gender Pay Gap Reporting

The final Equality Act 2010 (Gender Pay Gap Reporting Information) Regulations 2017 were published in December 2016 and are expected to come into force on 6 April 2017.  The Regulations require all private sector employers with 250 or more employees to report on the difference in pay (including bonus) between men and women within their organisations. Employers will be required to publish their first gender pay gap reports by 4 April 2018 (click here). ACAS have just published guidance:

Termination Payments

From April 2018, any payment in lieu of notice (whether contractual or otherwise) will be subject to tax and class 1 NICs. Termination payments above the £30,000 tax free threshold will become subject to employer NICs as well as income tax. Foreign service relief will be abolished and a provision included clarifying the tax exemption for termination payments (including the amount over £30,000) resulting from death, disability or injury to an employee does not apply to injury to feelings awards (click here).

Employment Tribunals

Government proposals include modernising the handling of ET claims, the delegation of judicial functions to caseworkers and tailoring the tribunal panel to the needs of the case.   Consultation closed on 20 January 2017 and further developments are expected later this year (click here).

The Supreme Court is expected to hear Unison’s appeal against the introduction of ET fees in March. The Government has also just published its long-awaited review of fees in the ET system.

Data Protection

The EU General Data Protection Regulation (GDPR) will come into force in May 2018, before the UK leaves the EU. GDPR expands existing data protection laws and will result in stringent governance and record-keeping requirements together with increased penalties for non-compliance. The Information Commissioner’s Office has advised that employers should continue to prepare for GDPR.

Regulatory References

References for certain categories of employees including senior managers in banks, investment firms and insurance companies, must include specific disclosures on a standard template. Previous employers are now under an obligation to inform new employers if they become aware of matters that would have caused them to complete the reference differently.

From March 2017, relevant firms will have to take reasonable steps to obtain references covering a 6 year period, use the mandatory reference template when requesting and providing references, together with updating regulatory references they have given for a period of 6 years.

All information in this update is intended for general guidance only and is not intended to be comprehensive, or to provide legal advice.