Would reforming the Working Time regulations be a good idea?

Brexit. Brexit. Brexit. Whilst Christmas and New Year provided a welcome rest from Brexit-dominated headlines, there is no doubt that the media train will start in earnest sooner rather than later.

Just before Christmas, various newspapers reported that the Working Time Regulations could be a target for the Government following the UK’s departure from the EU. Certain newspapers went further and stated that repealing or substantially amending the Working Time Regulations would be a positive example of removing so-called ‘red tape’ and freeing businesses from the burden of overbearing regulations; some newspapers even trotted out the over-used line of ‘taking back control’.

So, to use that awful phrase, should the UK ‘take back control’ and amend the Working Time Regulations?

Is Buddy the Elf a good employee?

 It’s nearly here! Christmas is just five days away! The radio stations are playing Last Christmas by Wham on loop, supermarkets are clogging up the TV with advertisements for gooey desserts and it’s getting easier and easier to spot those remaining advert calendar squares!

Every family tends to have an annual pre-Christmas tradition and I’m no different. In fact, mine is to visit my younger family members each year and watch Elf with them. For those not in the know, Elf is a Christmas film which came out in 2003 and stars Will Ferrell as a human who is adopted by Santa’s elves and raised as a Christmas Elf at the North Pole. It sounds terrible but, in fact, it’s a cult classic that was named Best Christmas film in a recent survey!

Anyway, what better time of the year to explore whether or not Buddy the Elf is a good employee or not? I mean, it is an employment law-related and Christmas-themed topic, so what are we waiting for? Let’s travel through the Candy Cane forest and explore this further!

So, to give us some background, Buddy was a baby at an orphanage who snuck into Santa’s sack one night. When Santa discovers him at the bottom of his sack upon his return to the North Pole, an elf adopts him and raises Buddy as his own. Unfortunately, Buddy grows at three times the rate (and height) of the elves and, eventually, discovers that he is a human, not a Christmas Elf. Aside from his height, this is especially noticeable when Buddy can ‘only’ make 85 Etch-A-Sketches a day rather than his 1,000 daily target in Santa’s workshop. Upon discovering that he is human, Buddy goes to New York to find his real father and save him from the naughty list, as well as looking for a more normal life.

During the film, Buddy has work experience at his real father’s book company, work experience in a mail room and works as an employee of a large department store in the Christmas section. Buddy is dedicated and keen but, overall, was he a good employee (by UK employment law standards)?

More news about modern working practices and the “gig economy”

Last week’s news was dominated by the Budget and the Class 4 National Insurance contributions’ increase which was announced and then, within 24 hours, kicked into the long grass. An interesting fact which emerged in the news is that the UK workforce now includes 15% who are classed a self-employed for tax purposes. However, as I have reported this month (in the Pimlico Plumbers case) many of these people are nonetheless classified as workers in the context of employment law and therefore have rights which can be pursued in employment tribunals.

On 22 February The Work and Pensions Committee heard evidence from executives from Uber, Deliveroo, Amazon and courier firm Hermes UK as part of its investigation into modern employment practices. It is estimated that there are now some five million workers in the “gig economy”, of whom some 910,000 are on zero hours contracts, an increase of 100,000 from 2015 to 2016 (ONS Labour Force Survey). UK and Ireland managing director of Deliveroo, Dan Warne, said that flexibility is important to its riders, adding:
We cannot offer that amount of flexibility to those riders if we’re forced to pay a given wage and a given hour to every single rider.
However, it emerged recently that Deliveroo had a clause in its contracts that banned workers from contesting their self-employed status in employment tribunals. Under questioning, Mr Warne acknowledged that the Company needed to “revise the contract”. He said:
This is not something that’s enforced, so there’s no need to have it in there… In practice, if they wished to contest their [self-employed] status they could do so and we wouldn’t challenge them on that.
Although the clause would almost certainly not have been enforceable, it is easy to see how it could operate as a powerful disincentive to low-paid riders with no guarantee of work.

Meanwhile, it has emerged that DPD, which deliver parcels for Marks & Spencer, John Lewis and River Island, fines their couriers £150 per day if they cannot find cover when they are ill. This has resulted in drivers being forced to work when they are sick. The fine, which is described as “liquidated damages”, means that couriers who earn on average £200 a day, lose £350 if they cannot work through illness and are unable to find a substitute. Chair of the select committee, Frank Field, commented:

The gig economy is producing wave after wave of evidence on the grim reality of life at the bottom of Britain’s labour market…A group of companies now controls the working lives of an unknown number of people, and yet evades its own responsibilities as employers and taxpayers by labelling those people as self-employed… This move [by DPD] makes the rest of the gig economy look as though it operates in the Garden of Eden.

A local example of dubious working practices came to light a few weeks ago. Mooboo Bubble Tea, a cafe chain, has a branch located in Liverpool One. New staff reported that they were being made to work a 40-hour trial shift with no pay and no guarantee of a job, apparently in direct breach of the minimum wage regulations.

Can workers claim injury to feelings for a breach of the Working Time Regulations 1998?

This question was recently considered by The Employment Appeal Tribunal (EAT) in the case of Santos Gomes v Higher Level Care Ltd UKEAT/0017/16.
The Facts
The Claimant, Miss Santos Gomes was successful in proving that her employer, Higher Level Care Ltd, had failed in their duty to provide her with 20 minute rest breaks as required by the Working Time Regulations 1998 (WTR).  or this element of the claim she was awarded compensation for her financial loss in the amount of £1,220. The Employment Tribunal however refused to entertain a further compensation claim for injury to feelings.

The Claimant brought an appeal to the EAT on the basis that Regulation 30(4) did not prevent an award for injury to feelings being made, compensation for injury to feelings was not restricted to discrimination laws, and the WTR did not provide an adequate remedy for this as is required by EU Law.
The Law
Regulation 12 of the WTR states that a worker is entitled to a minimum rest break of 20 minutes when working for more than 6 hours per day. Subsequently a worker is permitted to bring a complaint against their employer for a breach of these entitlements. When in such occasions an ET finds in favour of the Claimant, a declaration must be made in this regard and an award of compensation can be made.

The WTR state only that any compensation awarded should be what the ET considers to be ‘just and equitable’ taking into account all of the circumstances and the employers default in refusing to allow the worker to exercise their right (Reg 30(4)(a)) and any subsequent loss sustained by that worker attributable to the matters complained of (Reg 30(4)(b)).  Whilst compensation for injury to feelings is available in some types of employment law claims (mostly for discrimination), you cannot claim such compensation for breach of contract or indeed unfair dismissal claims.
The decision of the EAT

Does time taken travelling to and from work count as working time?

It has long been the case that time spent in travelling to and from work does not form part of the working time of employees. Occasionally, specific issues have been considered, such as when an employer relocates, but the main principle has not altered.

However the European Court of Justice has now had its say in the case of Federación de Servicios Privados del sindicato Comisiones Obreras. This case, on referral from the Spanish national court, concerned workers who were required to travel to different locations to work. The Advocate General described them as “peripatetic workers, that is to say workers who are not assigned to a fixed or habitual place of work [and] spend time travelling from home to the first customer designated by their employer and from the last customer designated by their employer to their homes”.

It was noted that, under Spanish law, working hours should not exceed 40 hours of “actual work” per week, calculated on an annual basis. There has to be at least 12 hours between the end of one working day and the beginning of another and  normal working hours should not exceed nine per day.

The employees concerned were technicians who worked for security system installation and maintenance services. They were allocated to areas and they used company vehicles to travel to homes and industrial and commercial premises where they were required to carry out work. Unsurprisingly the distances from a worker’s home to the first workplace varied considerably and were sometimes more than 100 km. They were also required to travel at least once a week to the offices of a transport logistics company to collect parts. Their place of work each day was notified to them by messages sent to company issued Blackberrys provided to each of them.

For the purpose of calculating working time the employer did not include time spent on the first journey of the day, from home to work, and the last journey of the day, from work to home. Instead, time was calculated with reference to the time of arrival at the first job and the time of departure from the last job.

In the view of the national court this arrangement meant that workers could not adjust their private life and their place of residence for the purpose of proximity to the place of work. Travelling time could not therefore be regarded as rest time, having regard also to health and safety issues. Equally it was not time that the worker was at the employer’s disposal so that he could be assigned to other work. It was therefore not clear whether this was working time or a rest period, hence the referral to the European Court.

Holiday pay doesn’t include voluntary overtime, does it?

I rarely report decisions of the Northern Ireland courts because they are not binding in England and Wales. However, this is the second consecutive month in which a Northern Irish decision is worthy of comment, this time from the Court of Appeal in Patterson v Castlereagh Borough Council.

Mr Patterson, a lead claimant for the purposes of a multiple claim, alleged that there was an unlawful deduction from his wages because he was no longer paid holiday pay relating to casual work as a recreation assistant in addition to his post as an assistant plant engineer. His claim was amended to allege that his holiday pay did not take into account the voluntary overtime he worked in his full time post.

His claim relating to his casual work was successful and this was not challenged. Consequently his appeal was limited to the voluntary overtime aspect. In this case Mr Patterson was asked to work overtime by his employer and could choose whether or not to do so because it was not a contractual obligation. Hence its classification as voluntary. There was a technical point concerning whether Mr Patterson had established the earnings he received pursuant to the voluntary overtime but both parties agreed that the point of principle should be determined.

Assuming that the earnings were established evidence submitted for the appeal suggested that they would have amounted an average additional pay of £60 per week. Having considered the relevant sections of the Working Time Directive the Court went on to consider the relevant case law. In British Airways plc v Williams (2012) the Supreme Court considered whether, for the purposes of calculating holiday pay, a pilot’s remuneration should be treated as basic pay or whether it should be based on “normal remuneration”, i.e. including payments “intrinsically linked” to the performance of the employee’s duties. Having referred the question to the European Court of Justice the answer was that it should be based on normal remuneration.

In Lock v British Gas (2014) that principle was extended to include commission payments and in Bear Scotland Limited and Others (2015) employees were successful in having included in the holiday calculation overtime which they were required to work, but which the employer was not obliged to offer.

last month it was overtime, this month it is commission to be added to holiday pay

In what appears to be an emerging trend to emulate actual regular pay rather than basic pay, the Court of Justice of the European Union (CJEU) has held that holiday pay should include commission if commission forms part of an employee’s remuneration.

Last month I reported that overtime (or its notional equivalent) should be included in holiday pay and that failure to do so could result in significant back pay claims. Applying very similar reasoning the European Court in the case of British Gas v Lock has held that holiday pay should include commission.

Mr Lock was employed by British Gas in 2010 as an internal energy sales consultant. His job entailed persuading business clients to buy energy products. His basic salary was £1222.50 per month. Commission was also paid monthly, based on sales made but with reference to a period some weeks or months earlier (presumably to allow for variations and cancellations).

He was on annual leave from 19 December 2011 to 3 January 2012. His December salary comprised his basic pay of £1222.50 plus commission in relation to earlier weeks amounting to £2350.31. His average monthly commission for 2011 was £1912.67.

During his annual leave he did not make any sales and therefore did not earn any corresponding commission. Logically, that had an adverse impact on his earnings during the month after his annual leave. As a result he brought an employment tribunal claim for what he considered to be the balance of his holiday pay for the period from 19 December to 3 January. This was based on notional commission which he would have earned had he been in work during the period he was on holiday, even though it did not equate to commission earned on actual sales.

In the sort of European judgment which causes understandable irritation to many people, the CJEU held on 22 May that, notwithstanding that Mr Lock received payment of both basic salary and commission during his annual leave, the fact that he lost out on commission in subsequent months because of the holiday should be compensated.

beware incapacity dismissals and judging what are day to day activities

Aderemi v London and South Eastern Railway Ltd gives some useful pointers about what sort of disability will be a protected characteristic under the Equality Act 2010.

– While an inability to carry out all your work duties does not equate to an inability to carry out day to day activities, it should not be assumed from this that a work activity is not a day to day activity;
– Tribunals should concentrate on what the employee cannot do, not what he can do, when looking at whether there is a substantial impact on day to day activities;
– When looking at what is substantial or not, it is wrong to think that there is a sliding scale with ”trivial” at one end and “substantial“ at the other – if an effect is not trivial, it is substantial

In this particular case, Mr Aderemi was a station assistant who developed a bad back and was unable to stand for long periods, bend, or lift. This gave him problems carrying out his main duties including checking tickets. His employer dismissed him on the ground of lack of capability. An employment tribunal found that he was not disabled, so his dismissal was not unlawful discrimination, nor was it unfair. In the Employment Appeal Tribunal Mr Justice Langstaff (President) took the view that the tribunal had been unduly restrictive in its approach to what amounted to a day to day activity. As he pointed out:
If the problem is put simply, as being on one’s feet in a job for lengthy periods of time, then it is not difficult to think of very many jobs which would fit that description.
In other words, the ability to stand for longer than half an hour at a time is so commonplace a part of people’s working lives that is falls within the scope of “day to day activity”.
The EAT ordered that both the discrimination finding and the finding that the dismissal was fair were to be reconsidered, pointing out that the decision as to disability could have a knock on effect on the fairness of the dismissal, especially if the disability was caused by the employee’s work.
The case highlights the potentially awkward overlap between potentially fair dismissal on the ground of incapacity and disability discrimination. The letter notifying dismissal included a typical explanation of the reason from an incapacity perspective:

employer entitled to refuse overtime to employee who refused to sign opt out from Working Time Regulations

Arriva London South Ltd v Nicolaou concerned a bus driver who complained that his employers were imposing an unlawful detriment when they withdrew rest day overtime from him. The decision was made under a policy of only giving overtime to those workers who had agreed to opt out of the 48 hour maximum working week. The policy was designed to ensure compliance with the rule on maximum working hours under the Working Time regulations.

His Honour Judge Peter Clark, sitting alone in the Employment Appeal Tribunal applied the test that it was necessary to establish the “reason why” an employer had acted in the way it had.

offshore workers can be required to take annual leave while onshore

Offshore workers in the oil and gas industries generally work on a ”two weeks on, two weeks off” shift basis.

In Russell & Ors v Transocean International Resources Ltd & Ors (Scotland), offshore workers, whose contracts required that they take their leave during periods when they were ashore, unsuccessfully sought to establish that they were entitled to take their statutory annual leave under the Working Time Regulations 1998 (WTR) at times when they would otherwise be offshore.

The competing representations were succinctly summarised by Lord Hope as follows: