Employment Bulletin – June 2018

EU to introduce high level protection for whistleblowers

The European Commission has proposed a wide-ranging new law to strengthen protection for whistleblowers who uncover unlawful activities in their company or organisation.

It’s thought the new measures are likely to be adopted by the UK as part of our future trading relationship with Europe after Brexit.

A Commission statement says “The new law will establish safe channels for reporting both within an organisation and to public authorities. It will also protect whistleblowers against dismissal, demotion and other forms of retaliation and require national authorities to inform citizens and provide training for public authorities on how to deal with whistleblowers.”

First Vice-President Frans Timmermans said: “Many recent scandals may never have come to light if insiders hadn’t had the courage to speak out. But those who did took enormous risks. So, if we better protect whistleblowers, we can better detect and prevent harm to the public interest such as fraud, corruption, corporate tax avoidance or damage to people’s health and the environment. There should be no punishment for doing the right thing.”

The proposals ensure EU-wide protection for revealing breaches of EU legislation in public procurement, financial services, money laundering and terrorist financing, product safety, transport safety, environmental protection, nuclear safety, food and feed safety, animal health and welfare, public health, consumer protection, privacy, data protection and security of network and information systems.

It also applies to breaches of EU competition rules, violations and abuse of corporate tax rules and damage to the EU’s financial interests.

All companies with more than 50 employees or with an annual turnover of over €10m will have to set up an internal procedure to handle whistleblowers’ reports.

We shall keep clients informed of developments.

 

Lack of pay rise resulted in ‘unlawful deduction of wages’

A local authority’s decision not to award incremental pay increases resulted in unlawful deductions of wages for some of its employees.

That was the decision of the Court of Appeal in a case involving Nottingham City Council and three groups of its employees.

The authority’s administrative staff were graded on a “spinal column”, with each spinal column point (SCP) denoting a salary level. They were entitled to move each year to the next SCP until they reached the top of their grade.

Manual workers had no such progression and so the authority wanted to eliminate that difference.

It created a new “core contract” with new terms and conditions for all employees, which did not explicitly mention pay progression but discussed bands and SCPs. A booklet illustrating the new system was issued, which stated that employees would gain an SCP each year.

In July 2010, the authority reached a collective agreement with the relevant trade unions, which did not explicitly refer to pay progression. The new terms took effect in November. In December, it announced a freeze on pay progression.

In 2013, the unions activated a grievance procedure. The authority denied that there was any contractual right to pay progression, and if there had been, the employees had accepted a variation to their contract by continuing to work without protest until 2013.

The case went all the way to the Court of Appeal which ruled in favour of the employees. It held that the terms accepted by the administrative staff were contained in the booklet, which stated they had an entitlement to a pay progression.

The fact that the other two groups of employees never received the booklet was not important. The core contract implied pay progression. New employees would reasonably understand that their position would be the same as that of existing employees.

The court also rejected the authority’s submission that the employees had accepted the variation by continuing to work without protest. It held that the variation had been wholly disadvantageous to the employees, yet the matter had not been put to them as requiring their agreement.

There had also been union protest before and after implementation of the freeze.

 

Manager with reduced role under TUPE was ‘unfairly dismissed’ 

An NHS manager who was told her role was being reduced by half during a TUPE transfer was unfairly dismissed.

The employee was a senior clinical commissioning manager who worked two days a week from home. She was considered a highly valued employee.

In February 2015, she made a protected disclosure in relation to tender irregularities for a new contract for ambulance services. Because of her disclosures, the procurement process was cancelled and put out to tender again.

In November 2015, the employee’s employment was transferred under TUPE to a Clinical Commissioning Group.

The transfer consultation proceeded smoothly until a meeting that took place in February 2016. The employee said that two hours before the meeting, she was told that she would no longer be able to work from home and that half of her responsibilities were going to be taken from her.

She felt the change was due to her making a protected disclosure and so she lodged a grievance under the whistleblowing policy. An internal investigation found “no relationship between the whistleblowing raised in the previous year and the events surrounding the change to [the employee’s] role”.

The employee was upset and went on sick leave. She later resigned and brought a claim of unfair dismissal.

The Employment Tribunal rejected her claim that there was a link between her treatment and the protected disclosure so her complaint of unfair dismissal because of whistleblowing was dismissed.

However, it found she was unfairly dismissed because the reduction in her role breached the terms of her employment contract.

The Judge said: “I am satisfied that there was a very substantial and significant reduction of the Claimant’s role, duties and responsibilities. The loss was not attributed to any TUPE factor.

“In those circumstances the removal of duties amounted to a breach of an express term or terms of

the contract. There is no doubt having regard to the extent of the reduction in duties that it was a fundamental breach which went to the root of the contract of employment.”

Compensation will be decided at a separate hearing.

 

Disabled employee wins claim over ‘forced evening work’

A disabled employee has won a constructive dismissal claim after his employer ‘forced’ him to work evenings.

The employee joined the firm in October 2011. He regularly worked 12 to 14-hour days that stretched well into the evening.

In July 2012 he was involved in an accident that resulted in him developing issues such as dizziness, fatigue, headaches and difficulty concentrating.

He worked reduced hours when he returned from recuperating, but after six months his working day start increasing again until 6.30 to 7pm.

When he initially agreed to work late, his employer expected that he would continue to do so indefinitely.

However, after four months he objected to working into the evening. This led to a heated exchange between the employee and one of the owners of the business.

The owner berated him in front of his colleagues and demanded an apology. He also said that if he didn’t like it he could leave.

The employee resigned due to the owner’s conduct and because he was being ‘forced’ to work evenings.

He brought proceedings for disability discrimination and constructive dismissal. He told the Employment Tribunal that he would have retracted his resignation if he had been asked to do so.

The company claimed the employee would have resigned from his job anyway as his wife had accepted a job in the US.

The tribunal ruled that this was why he had resigned rather than the argument with the owner over evening hours. It also said that the employee had not been ‘required’ to work evening hours; just that it was ‘expected’ of him.

However, the Employment Appeal Tribunal (EAT) overturned those decisions. It said that the tribunal had displayed a narrow view of the circumstances.

It held that the employee resigned in response to a fundamental breach of his employment contract.

The Court of Appeal upheld the EAT ruling.