Barista rights: Starbucks or Starbucked?

Right, to start, a confession: I’m a coffee fanatic. And, no, that doesn’t mean that I purely order espresso shots and seek to then identify the origin of the exact coffee bean used when drinking it; rather, I regularly seek out coffee as a near necessary small luxury in life.

Now, that doesn’t mean I literally can’t function
without it. I managed to give it up for
40 days over Lent a few years ago, albeit my wife has practically banned me
from doing so again (the first week of work absent coffee wasn’t the most fun
experience!) But, overall, in a
stressful day, my instinct is to reach for a nice cup of java (whilst, if
you’re interested, is the name of an island they used to obtain coffee beans
from (as was the island of Mocha (seriously!))

Why the sudden fascination in coffee? Well, I’ve recently been reading an
intriguing book called ‘Starbucked’ by Taylor Clark. And, no, it isn’t a demolition job of Starbucks (nor a ‘fanbook’ financed by the company); rather, it is a neutral and balanced
look at the growth of Starbucks and also explores their employment practices
and treatment of staff.

As many are aware, Starbucks haven’t had the best
treatment in the press in recent years in relation to staff treatment (or,
indeed, their policies of allegedly ‘minimising’ tax liability). But how much of that is true?

Personal liability of company directors

The conventional view of the liability of a limited company is that any corporate losses will not exceed the amount invested in it, i.e. as represented but limited to the value of its shares. In other words, shareholders’ personal assets are not at risk if the company fails. The company is a separate legal entity so it carries its own losses.

However, company directors (who are often also shareholders) owe a duty of care to the company, its shareholders, employees and creditors. As a result, a director can become liable for his or her own PAYE and NI payments, for income tax due on any cash taken from the company, any personal guarantees and/or indemnities provided to company creditors, and any liabilities resulting from wrongful trading (trading when the company was insolvent and had no prospect of avoiding liquidation), misfeasance (e.g. acquiring a company asset for less than it was worth) and fraudulent trading (e.g. fraudulently obtaining credit in the company’s name).

In last November’s newsletter I reported a case in which company directors were held to be liable for a £2m award in a whistleblowing case. This is because in such cases, as with discrimination claims, individuals can be named as co-respondents along with the limited company.

We now have another example of how directors can be held liable in respect of the actions of a company in the High Court case of Antuzis & others v DJ Houghton Catching Services & others.

Can a long-term sickness employee become practically unsackable?

The Employment Appeal Tribunal (EAT) have recently held an employee to hold ‘an implied right not to be dismissed’ when on long-term sick leave.

Naturally, this has caused many employees great concern
because long-term sickness absence, in itself, is usually fair reason to
consider dismissal.  Whilst there can be
various factors at play, including any potential disability of the employee,
the principle of an individual having to be present at work to fulfil their job
role (and employment) remains.

So what happened in the recent case of ICTS (UK) Limited v Mr A Visram to cause such concern?

Well, let’s set the scene briefly, Mr Visram was
contractually entitled to sickness benefit payments (termed ‘Long Term
Disability Benefits’) during any period of continuous sickness absence from
employment whilst he remained an employee. 
But, for various reasons, the insurer and employer didn’t wish to pay
them and, in doing so, Mr Visram was dismissed on grounds of sickness absence
and so ended his entitlement to contractual Long Term Disability Benefits payments
by the insurer (as the policy required his continued employment).

More sexual harassment claims in law firms

While many firms are very forward looking, it is apparent that the old “Mad Men” culture is hanging on in several locations, not least in law firms, even if in isolated pockets.

A couple of weeks ago, Lloyds of London announced a zero-tolerance approach to sexual harassment after it had been called “a meat market” and “institutionally sexist”. In response to recent allegations of harassment, Lloyds has announced that it will impose lifetime bans on anyone found guilty of “inappropriate behaviour”, as well as banning daytime drinking, again with a complete ban from the market for those who breach the rules.

Judging by recent reports, it seems that several law firms could benefit from considering what steps should be taken to contain the actions of their owners and employees

In Harrison v Riaa Barker Gillette LLP, a case heard over 11 days in late 2017 and early 2018 but in respect of which the judgment wasn’t published until late March 2019, the employment tribunal was asked to consider complaints sex discrimination, victimisation and harassment brought by Ms Harrison, formerly a partner and head of employment with the Respondent, a commercial and private client law firm based in the West End.

Ms Harrison joined the firm in December 2012 and was at the time the only female partner. She described ” a male dominated environment where inappropriate sexist and sometimes racist behaviour was tolerated, and on occasions laughed at”, with partners engaging in puerile banter.