What is a reasonable period to ‘lay off’ your employees?

One of the most important and often useful clauses within a contract of employment for employers in any trade is the ‘lay off/short-time working clause’.

For those that are not aware, such a clause would usually entitle an employer who suffers a downturn in the work available, to either reduce the hours of the affected employees or alternatively, completely ‘lay off’ such employees without pay – subject of course to the employee’s right to receive statutory guarantee pay in qualifying circumstances.

If an employer attempts to take this action without such a clause being present, the employee may be entitled to resign and claim constructive unfair dismissal.

Section 135(1)(b) of the Employment Rights Act 1996 provides further guidance as to the rights of the employee in a lay off situation, and explicitly states that provided the below criteria are satisfied, the employee’s employment will be terminated and a redundancy payment must be made:

The employee must have two year’s’ continuous service;
The employee must have been laid off or kept on short-time working for a period of at least four consecutive weeks or, or a total of six weeks (of which no more than three are consecutive) in a thirteen week period;
The employee must thereafter follow the procedure as set out in sections 147 – 154 of the ERA 1996, declaring their intention to claim a redundancy payment.

If the employer reasonably believes that work will become available in the next four weeks, it must serve a ‘counter-notice’ (section 149 ERA) meaning that the employee will not be eligible for the redundancy payment at this time.

Previously there have been conflicting decisions in the Employment Appeal Tribunal as to whether an employer can only lay off an employee for a ‘reasonable period’. 

In the recent case of Craig v Bob Lindfield & Son Ltd UKEAT/0220/15, the EAT was asked to consider whether a ‘reasonableness term’ could be implied into a lay off/short time working clause within a contract of employment to allow lay off and short-time working for an indefinite period without pay.

The facts of the case were that in July 2014 following a reduction in work available, the Respondent, a design and technology company, advised all affected employees that they would be laid off as of 21 July 2014.  The contracts of employment of the affected employees did allow for this course of action, albeit the relevant clause was actually contained within the Employee Handbook rather than the Contracts of Employment, which was incorporated into the Contracts.

The Claimant, a designer, was one of the aforementioned affected employees and on 22 August 2014, sent an email to his employer advising that he had found alternative employment elsewhere and was due to start on 1 September 2014.  The Claimant further advised that given he had now been laid off for almost five weeks, he felt he was entitled to a statutory redundancy payment to which the Respondent replied that this was not the case as he thought that work would resume shortly.

The Claimant thereafter informed the Respondent that he felt he had no alternative in the circumstances, than to resign and bring a claim for constructive dismissal.  The Respondent subsequently issued him with a section 149 counter-notice and advised the Claimant that his role was still required by the Company and was therefore not redundant.

The Claimant brought a claim at the Employment Tribunal claiming constructive dismissal on the basis that the lay off period was unreasonable.  The Employment Tribunal found for the Respondent, stating that there was no implied term in respect of the reasonableness of a lay off period and even if there were, the period in these circumstances was not held to be unreasonable.  In addition, as there had been no repudiatory breach of the contract of employment the Claimant was not entitled to claim constructive dismissal.

The Claimant subsequently appealed against the Employment Tribunal’s decision on the basis that the Tribunal was incorrect to find that the lay-off clause was not subject to a term that lay-off should be no longer than was reasonable, and that it further erred in concluding that four and a half weeks was not an unreasonably long period.

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Briggs Report on the future of Courts and Tribunals

On 12 January Lord Justice Briggs published his interim report concerning the structure and operation of the civil courts. The full review is expected to be completed by the end of July 2016.

Mr Justice Briggs has identified a “clear and pressing need to create an Online Court”. This is intended to deal with claims with a value of up to £25,000. With the charming but concerning naivety of many senior judges Mr Justice Briggs suggests that this will “for the first time…give litigants effective access to justice without having to incur the disproportionate cost of using lawyers”. It is worth bearing in mind that as long ago as the 1950s the Tribunals Service was set up with the same objective – a straightforward process for the disposal of cases with the minimum of fuss and no need for lawyers. Well, as we all know, some of the most technical legal arguments and most appealed cases are those heard in and emanating from the employment tribunals.

Mr Justice Briggs identifies three stages in the process. Stage 1 is “a largely automated, inter-active (note the hyphen – nothing too modern here) online process for the identification of the issues and the provision of documentary evidence”. Stage 2 is conciliation and case management, by case officers. Stage 3 is to be resolution by judges. He envisages the court using “documents on screen, telephone, video or face to face meetings to meet the needs of each case”. I am bound to say “good luck with that” in a lawyer free environment and with the Courts’ abysmal record in installing and managing IT.

He also envisages that many functions currently undertaken by judges will be dealt with by “case officers supervised by judges”. We have seen similar changes in the tribunals and as long as there are sensible limits placed of the powers of the case workers this would in my view be a welcome development.

However, by far the most interesting proposal for readers of this blog is the suggestion that the Employment Tribunals and Employment Appeal Tribunals might be integrated into the structure of the civil courts.

Regular readers of the blog will know that I have for very many years advocated the merging of tribunals with the civil courts. There are obvious savings to be made in terms of overheads, particularly properties and staff. Perhaps some of the county courts currently earmarked for closure could be saved by taking on what are currently tribunal claims in addition to their current caseloads. There would be a great deal to be said for having common procedural rules instead of similar but occasionally significantly different rules applied in different forums. Merging the courts and tribunals would also remove the anomaly that certain claims can only be brought in employment tribunals whereas others (e.g. contract claims) can be brought in the county courts, with the obvious risk of duplication and additional costs.

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European Court rules that private messages at work can be read by employers

As widely reported a couple of weeks ago the European Court of Human Rights has handed down a significant judgment in the Romanian case of Barbulescu which confirms the right of employers to access the private communications of employees while they are at work.

Mr Barbulescu, a Romanian national living in Bucharest, worked for a private company as an engineer in charge of sales from August 2004 to August 2007. At his employer’s request he set up a Yahoo Messenger account  to be used as a means of replying to clients’ enquiries. On 13 July 2007 he was informed that his Messenger communications had been monitored from 5 to 13 July and this revealed that he had been using the account for personal purposes. Mr Barbulescu countered by suggesting that the monitoring of the account was criminal activity. The analysis showed that he had exchanged messages with his fiancé and his brother and the messages related to personal matters including his personal health and sex life. His employment was terminated on 1 August 2007 for breach of the employer’s regulations which included a ban on using electronic media for personal purposes.

Mr Barbulescu brought a claim in the Bucharest County Court and failed on the basis that the employer’s regulations were not illegal and correct procedures were followed. He appealed and sought to rely on Article 8 of the European Convention on Human Rights (right to respect for family and private life). The Bucharest Court of Appeal again found in favour of the employer. In the ECHR it was noted that Mr Barbulescu alleged that his personal Yahoo Messenger account had been accessed by the employer in addition to the analysis of the work account. He maintained that he was entitled to expect privacy, given the very nature of the software in question.

There was a balance to be struck between respect for the individual’s private life and correspondence and the employer’s legitimate interests as a private company. the domestic courts had found that the applicant had used Yahoo Messenger on the company’s computer and that he had done so during working hours. This is what established the disciplinary breach and the consequent lawful termination of employment.

The employer had acted within the scope of its disciplinary powers. It was not unreasonable for an employer to want to verify that its employees are completing their professional tasks during working hours. Further, the employer’s monitoring was limited in scope and proportionate.

However the decision should not be seen as providing carte blanche for employers to snoop on their employees’ private communications.

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Unpaid award penalties to be introduced in April

Section 150 of the Small Business, Enterprise and Employment Act 2015 provides for a new Part 2A to be inserted in the Employment Tribunals Act 1996 and entitled “Financial Penalties for Failure to Pay Sums Ordered to be Paid or Settlement Sums”. This brings into effect the much heralded and somewhat delayed procedure for imposing financial penalties on paying parties who do not make their payments on time. Notably, any lateness, even of a day or two, can trigger the process although there is a final opportunity to make payment before the fine is levied.

New section 37A confirms that the scope is financial awards made by an order in tribunal proceedings including costs and expenses and amounts ordered to be paid to the Secretary of State. The amount covered includes the initial award and interest. It does not include any amount awarded when the order can still be appealed. Where an award is payable by instalments and there is a default in making a payment when it falls due any remaining instalments are treated as falling due on the same date as the missed payment, i.e. the balance is treated as payable forthwith.

The new system provides for the appointment of enforcement officers. Where a default is identified an enforcement officer may issue a warning notice stating an intention to impose a financial penalty overdue payments are made by a specified date. If there has been a prior penalty notice a further one cannot be issued for at least three months since the end of the prior relevant period. the date for payment (the specified date) must be at least 28 days after the date of the warning notice and the specified amount must be the amount due on the date when the warning notice is given. Once served it is possible for the employer (assuming that the employer is the paying party) to make representations with a view to challenging the order.

If the employer fails to comply with the warning notice an enforcement officer may issue a penalty notice This requires the paying party to pay a financial penalty to the Secretary of State. If the unpaid amount is less than £200 the penalty is £100. If it is more than £10,000 the penalty is £5000. Otherwise it is 50% of the unpaid amount of the relevant sum.

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Exclusion from voluntary redundancy of director aged over 50 was discriminatory

Mr Donkor was born in 1960 and started his employment with the Royal Bank of Scotland in 1978. He worked through the ranks and, from 2003, was employed as a regional director in retail banking. In 2012 there was a bank restructure which effectively meant that all existing regional directors would have to go through a selection exercise. Following a “desktop exercise” those not selected for interview would be given an options letter, allowing them to volunteer for redundancy. Those aged over 50 would also be given the option of early retirement.

Mr Donkor and three others were not offered an interview. He was one of two of the four over 50. However, when severance costs were calculated it was apparent that out of a total cost if £1.4m, £1.25m would be accounted for by the two employees aged over 50. In Mr Donkor’s case the overall cost would be £552,286.87, including a pension contribution of £460,275. The Bank reviewed the process and offered interviews to those who were initially successful. the result was that one of the four was successful. Mr Donkor was not. the value of Mr Donkor’s proposed settlement required approval at a higher level. While this process was ongoing the two other employees, both under 50, were given letters inviting them to apply for redundancy or redeployment. Mr Donkor was not sent such a letter.

In May 2012 an alternative role became available. He and Mr Batey (one of the employees under 50) were considered to be suitable candidates. Mr Donkor was notified accordingly and asked whether redundancy options were available. He was told that they were not since there was a suitable alternative role. He was offered and accepted the role before the selection exercise concerning him and Mr Batey was conducted. He remained in post until a further unrelated restructuring in 2013. In the meantime the bank changed its pension rules so that the minimum age at which volunteers for redundancy could apply for early redundancy was raised from 50 to 55. Within the 2013 restructure he was permitted to apply for voluntary redundancy and his employment terminated in September 2013.

He brought a claim of age discrimination on the basis that in the 2012 exercise he was not given the option of voluntary redundancy whereas comparable employees aged under 50 were. At the Employment Tribunal it was held that the employees aged under 50 were not appropriate comparators because they could not apply for voluntary early retirement. Alternatively, bearing in mind that Mr Donkor was not offered the option of voluntary early retirement so they were all treated in the same way. Further, even if there was less favourable treatment the reasons were the considerably higher cost and the likelihood that such a package would not be approved when there was suitable alternative employment. Accordingly, his claim failed. However, on appeal the Employment Appeal Tribunal disagreed with the Employment Tribunal and noted that the ET “lost its way when it came to this particular aspect of the direct age discrimination claim before it”.

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Tax tribunal holds that compensation for injury to feelings is taxable

In the absence of a codified system of law (such as that which operates in France) there is a risk that conflicts can arise between different jurisdictions and courts. For example, an insolvency court might make an order concerning property while a family court (applying its different rules) may make a conflicting order in respect of the same property. Which one prevails?

Another example is whether someone is an employee for tax purposes and for employment law purposes. It is possible to be an employee in one sense and not the other.

Another area of contention is whether compensation is taxable. The generally accepted view is that compensation for injury constitutes damages and as such should be tax free. However, compensation for financial losses, e.g. loss of earnings, should be taxable subject to the usual allowances and exemptions. In Moorthy v Commissioners for HM Revenue and Customs the Tax and Chancery Chamber of the Upper (Tax) Tribunal considered whether compensation for injury to feelings should be taxable.

Mr Moorthy worked for Jacobs Engineering (UK) Limited. In March 2010 he was made redundant and received a statutory redundancy payment of £10,640. He brought proceedings claiming unfair dismissal and discrimination. Following mediation he entered into a settlement agreement which provided for him to receive an “ex gratia payment of £200,000 by way of compensation for loss of office and employment”. Jacobs treated the first £30,000 as free of tax applying the usual exemption (section 403 Income Tax (Earnings and Pensions) Act 2003). Basic rate income tax was deducted from the remainder. Mr Moorthy completed his 2010-11 tax return on the basis that the full settlement amount was tax free. HMRC disagreed and amended the return to include an additional £140,023 taxable income. The issues on appeal were (1) whether the settlement payment was in connection with the termination of employment and was therefore chargeable to income tax (subject to the £30,000 exemption) (section 401); (2) if so, was it taken out of the charge to tax as a payment or benefit “on account of injury to…an employee”, namely injury to feelings (section 406); and (3) whether Mr Moorthy could rely on the concession made by HMRC in the closure notice that £30,000 of the settlement amount should be treated as damages for age discrimination and therefore not chargeable to income tax.

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Is an instruction to speak English discriminatory?

In recent years there has been a much-increased tendency for foreign workers and non-nationals to gravitate to particular types of work and workplaces. Admittedly limited analysis suggests that migrants from the European Union tended initially mainly to take factory jobs, seasonal farm work and cleaning jobs. More recently there has been a notable diversification into retail and hotel and catering work. For non-European migrants, typical jobs include doctors, chefs, nurses, IT professionals and scientists. This is no great surprise taking into account the requirement for higher professional and academic qualifications for workers arriving from outside the EU.

One consequence of the gravitation to particular work types is that it is often the case that workforces can include particularly high representation from one nationality or ethnic group. For example I expect that many of you will have heard hotel staff speaking to each other in a foreign language (often eastern European). This can present particular problems for employers since it has the capacity to encourage cliques and it is likely to be much more difficult to manage if a manager does not speak the same language as that routinely used by those being managed. There is also the risk of those who are not in the main language group being marginalised, albeit not in a way that is likely to be capable of protection under discrimination law as it stands if, say, the minority language in use is English.

One way in which employers have tried to address the problem is by requiring only English to be spoken by all staff at all times when on duty. There have been press reports about such requirements and the frequently expressed view that such a rule might be seen as indirectly discriminatory since it would be more difficult (and in certain circumstances impossible) for those for whom English is not their native language to comply.

The issue has now been considered by the Employment Appeal Tribunal in the case of Kelly v Covance Laboratories Limited. Mrs Anna Kelly is of Russian national origin and commenced employment with Covance as a contract analyst working in a testing laboratory in Harrogate in February 2014. The work duties included animal testing and therefore attracted the attention of the animal rights movement. In the first few weeks of her employment Mrs Kelly exhibited odd behaviour which suggested that she might be an animal rights infiltrator (there had been recent examples of such infiltration at the time). Examples of her odd behaviour included frequently using her mobile phone in work, often disappearing into the bathroom with her phone for excessive periods and speaking on her phone in Russian.

As a result, in early March 2014, she was instructed by her employer not to speak in Russian when at work. She objected, pointing out that two Ukrainian employees frequently spoke in Russian when at work (although this was not enforced). As a result they were also instructed not to do so. Other issues concerning conduct and performance were raised with her but she appeared to respond positively to these. However, problems continued and at her two months’ probationary appraisal she was told that she would be moved into a formal capability process. She raised a grievance against her manager, including allegations of race discrimination. The grievance was investigated and rejected and an appeal was unsuccessful, following which she was asked to attend a formal capability meeting in mid May. Prior to the meeting she contacted ACAS and, in turn, an ACAS officer contacted the employer. This prompted the employer to make further enquiries about her and a Google search disclosed that in October 2013 she had been convicted of benefit fraud in the Crown Court and was given a suspended prison sentence. She was asked at the meeting on 16 May why this had not been disclosed. On 20 May she handed in her resignation but subsequently brought Employment Tribunal proceedings including allegations of discrimination based on national origin, race and sex.

The Employment Tribunal was clear in its rejection of the complaint concerning the instruction to speak English. As reported in the EAT judgment:
…there was no reason to believe that another employee, of a different national origin to the Claimant but seeking to speak a language other than English in the workplace, would have been treated any differently.  The Claimant relied on the fact that her two Russian speaking Ukrainian colleagues had not been subjected to the same instruction, but the ET found that Mr Simpson had told their line managers to impose a similar prohibition on them, albeit that instruction had not been carried out.  The ET observed:

“47. … it would be a very strange thing if Mr Simpson were to discriminate against a Russian national in relation to the use of that language and treat a Ukrainian national more favourably in that regard. …”
With reference to national origins while Russian was her mother tongue the test was a subjective one as to why a person acted as they did. In this case the instruction was given not because she was a Russian national but because of the suspicions that the manager had about her. Accordingly the conduct did not “relate to” her national origins. Mrs Kelly appealed to the EAT.

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Balancing sickness absence and disability issues

Ever since the enactment of the Disability Discrimination Act 1995, now subsumed within the Equality Act 2010, there has been an uncomfortable overlap between dealing with ill-health incapacity as a potentially fair reason for dismissal and dealing with protection from disability discrimination. For example, the same facts might justify a fair termination of employment in the context of the usual grounds for dismissal but could also establish a valid claim for disability discrimination, which would constitute an automatically unfair dismissal.

The issue was most recently visited by the Court of Appeal in the case of Griffiths v DWP which is of particular significance for employers who want to take steps to minimise risks in this regard. Ms Griffiths was employed by the DWP from September 1976. In 2009 she began suffering from post viral fatigue and fibromyalgia. This meant that she was disabled within the meaning of the legislation. In 2011, following an absence of 66 days, she was issued with a formal written improvement warning. As a result she raised a grievance, contending that the employer should have made adjustments, first by discounting the circumstances leading to the warning because they were connected with her disability and, second, that the relevant policy should be modified so that she could have longer periods of sickness absence before facing sanctions than would be permitted for non-disabled employees. Both her grievance and the appeal were rejected.

As a result she presented a complaint of disability discrimination to an employment tribunal. Her claim was dismissed on the basis that no duty to make either adjustment had arisen and in any event it was not reasonable for the employer to be expected to make either of them. An appeal to Mr Recorder Luba QC in the Employment Appeal Tribunal was similarly unsuccessful.

The questions on appeal to the Court of Appeal were:

Was the majority of the Employment Tribunal right to conclude that there was no substantial disadvantage so as to engage the duty to make reasonable adjustments?
Was the EAT right to conclude that the proposed amendments were not steps within the meaning of the Equality Act?
If there was a duty and the proposed adjustments did constitute potential steps which might be taken did the Employment Tribunal misunderstand the claim in terms of reasonable adjustments?
If the Employment Tribunal did understand the claim was it entitled to find that it was not reasonable to expect the employer to make either of the proposed adjustments?

Having considered the relevant authorities at length Lord Justice Elias concluded that both the majority in the Employment Tribunal and the EAT were wrong to hold that there was not a substantial disadvantage sufficient to engage the duty to make reasonable adjustments. As he observed:
In my judgment, the appropriate formulation of the relevant [provision, criterion or practice] in a case of this kind was in essence how the ET framed it in this case: the employee must maintain a certain level of attendance at work in order not to be subject to the risk of disciplinary sanctions. That is the provision breach of which may end in warnings and ultimately dismissal. Once the relevant PCP is formulated in that way, in my judgment it is clear that the minority member was right to say that a disabled employee whose disability increases the likelihood of absence from work on ill health grounds, is disadvantaged in more than a minor or trivial way. Whilst it is no doubt true that both disabled and able bodied alike will, to a greater or lesser extent, suffer stress and anxiety if they are ill in circumstances which may lead to disciplinary sanctions, the risk of this occurring is obviously greater for that group of disabled workers whose disability results in more frequent, and perhaps longer, absences. They will find it more difficult to comply with the requirement relating to absenteeism and therefore will be disadvantaged by it.

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Online assessments and discrimination

There is an increasing tendency for employers to use online services in order to carry out HR related functions, including assessments, job interviews and appraisals. This can be daunting even for the most confident and well-equipped candidates and employees. I have recently witnessed such a process in action, with an international employer using an American Company to carry out initial interviews on a system similar to Skype but with time limits for replies in the style of a TV quiz show.

While this may be something that many candidates and employees will just have to get on with, it has the capacity to present fairly obvious problems for those who are disabled or have other protected characteristics within the meaning of the relevant sections of the Equality Act 2010. As an aside, it also seems to provide almost the polar opposite of providing fair opportunities by anonymising applications for employment.

The issue of discrimination and online assessments was to the fore in the recent Employment Appeal Tribunal case of Muzi-Mabaso v Commissioners for HMRC. Mr Muzi-Mabaso joined HMRC as a Grade AA employee in September 2004. As was known to the employer he suffered from depression and was a disabled person for the purposes of the Equality Act 2010, thereby obliging the employer to make reasonable adjustments where necessary to take into account the effects of the disability.

In 2010 Mr Muzi-Mabaso was temporarily promoted to Grade Band O and undertook training over two years with a view to possible promotion to Grade HO. He did not pass the required module and therefore reverted to Grade AA with effect from 28 November 2011. However there was little available work for Grade AA employees. Mr Muzi-Mabaso was on sick leave from 14 November 2011 to 22 April 2012, having been certified as suffering from stress and depression. Efforts were made to find a post for him but he was told that promotion opportunities could arise only as a result of open competition. Shortly before he returned from sickness absence he was place in a redeployment pool. After six months in the pool, if a job had not been found, an employee would be deemed surplus, thereby opening the possibility of redundancy.

In April 2012 Mr Muzi-Mabaso brought to the employer’s attention his phobia of the job application process. He said that going through the process was very stressful for him and therefore put him at a disadvantage by reason of his disability. He submitted an application for a Grade O vacancy. However, he said that he could not complete the online test as part of the process because he was too stressed due to his disabilities, specifically his frame of mind and phobias.

An offer was made for his manager to sit in with him and talk him through the questions. He was also offered a private room with a computer and extra time to complete the form. There was also a discussion about doing a paper test. However all these options were rejected by him. His application was kept open pending further medical reports. The employer took the view that excepting him from the online process was not a reasonable adjustment, not least because of the high number of applicants, many of whom needed reasonable adjustments for medical reasons.

Mr Muzi-Mabaso brought two claims before the Employment Tribunal: indirect disability discrimination on the basis that he was part of a disadvantaged group and direct disability discrimination on the basis of alleged failure to make reasonable adjustments in his case. Both claims failed and a costs order of £5000 was made in favour of HMRC.

On appeal it was held that Mr Muzi-Mabaso had not suffered any particular disadvantage by being placed in the redeployment pool. The main issue was the online test and Her Honour Judge Eady QC had trouble with the Employment Tribunal’s reasoning in concluding that Mr Muzi-Mabaso was not placed at a substantial disadvantage in this regard.

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Important guidelines concerning the “duty to mitigate”

It is often heard that a claimant has a duty to mitigate his or her loss, in other words to take reasonable steps to minimise losses resulting from the wrongdoing in respect of which compensation is claimed. This applies to many areas of law such as commercial contract disputes and accident claims, as well as in the field of employment law.

However, the extent of the duty is often overstated and it is generally the duty of the wrongdoer to demonstrate failure to mitigate. Even if it does so, it does not necessarily follow that it will be taken into account.

The duty to mitigate with reference to loss of earnings in a breach of contract claim was confirmed as long ago as 1912 in the case of British Westinghouse Electric and Manufacturing Co Ltd v Underground Electric Railways Co of London Ltd. In Wilding v British Telecommunications plc (2002) the Court of Appeal provided general guidance that the onus is on the employer to show that the worker unreasonably refused an offer of re-employment, the test of unreasonableness is an objective one based on all the evidence, when applying the test the attitude of the employer, the circumstances in which an offer may have been made and refused and the way in which the employee was treated should be taken into account and the court or tribunal should not be too stringent in its expectations of the injured party.

That guidance has recently been refined and expanded by the then President of the Employment Appeal Tribunal, Mr Justice Langstaff, in the case of Cooper Contracting Ltd v Lindsey.

Mr Cooper had been self-employed for a number of years before taking a job as a carpenter with Cooper Contracting in March 2011. His employment was terminated after 21 months on 29 December 2013. No reason was given since Coopers took the view that he was self-employed. An employment tribunal disagreed and found that he was unfairly dismissed. When dealing with the assessment of compensation the Employment Judge at the Tribunal observed as follows:
In the course of evidence Mr Lindsey was asked what he had been doing since his dismissal.  He told me that he has resumed working as a tradesman on his own account advertising principally on the My-builder website.  He was asked whether he had considered taking up another employed post either with a local employer or perhaps on building sites further afield.  He and Mrs Lindsey were very clear that working on building sites, whilst being something he had done in the past, would not be suitable now for [health] and family reasons and I accept that there may come a time in a person’s working life when some types of work are no longer appropriate.  As far as looking for another employed position is concerned, Mr Lindsey’s evidence was that he preferred to be his own boss having had the experience of employment with the Respondent.  It is very much his own choice, therefore, to continue with the financial ups and downs of self employment as a jobbing tradesman.
He continued:
The conclusions that I have reached are these.  Firstly, I find that it was reasonable for the Claimant to resume his previous life as a self-employed tradesman upon his dismissal: that is what he knew and where his recent experience lay.  I find that it has been reasonable for him for continue in that way to the present date.  I am satisfied however that there are other opportunities out there for employed work with higher remuneration if the Claimant wished to look for them but the Claimant has plainly decided that self-employment is the path he prefers for the future.  Whilst I am satisfied that his past losses to date ought to be reflected in the compensatory award I think the fact that he is unwilling to consider alternatives in the future makes it just and equitable for there to be a more limited award of future compensation than might otherwise be justified on a strict analysis of the figures.  I have therefore determined that as far as loss of earnings is concerned the Claimant should recover his loss of earnings to date and that I should assess future loss of earnings over a period of three months.  Thereafter, whilst I am sure there will be a continuing loss of earnings, it will reflect the Claimant’s desire to be his own boss rather than his value on the employed market for tradesmen.
I should point out that three months’ future loss is at the very lowest end of what might be expected with awards equating to between 12 and 36 months being far more common.

On appeal Mr Justice Langstaff was critical of the approach to mitigation often taken in tribunals:
As to mitigation, it seems to me there are very considerable dangers in an approach that suggests that the duty to mitigate is a duty to take all reasonable steps to lessen the loss.  This may divert focus away from the legal principles that apply to mitigation and demand too much because it may seem to lead to a conclusion that if a Respondent can show one reasonable step that was not taken the Respondent will succeed.  Recent experience in this Tribunal shows that the principles by reference to which an assertion of failure to mitigate loss is advanced are too often mis-stated, misunderstood or misapplied.  In part this may be because when applying those principles a court may express it in shorthand appropriate to the argument before it and in context of the particular facts but which when applied as a precedent can easily lead to error if too casually extrapolated to those other cases.
He went on to consider the relevant cases and then, very helpfully, distilled the main principles as follows:

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