I'm a solicitor and the chief operating officer at Canter Levin & Berg. I was formerly head of the employment department. I maintain this website so if you have any suggestions, criticisms or recommendations please email me at martinmalone@canter-law.co.uk. Outside work my interests include national hunt horse racing, France and French wine and current affairs. I also design and maintain websites.

An unwanted kiss is “Strictly” verboten at work

Strictly Come Dancing

Last Monday I watched the evening’s newspaper front pages coming in on Twitter and nearly every one featured the romantic kiss between celebrity Sean(n) Walsh and professional dancer Katya Jones caught by The Sun on what happened to be his girlfriend’s birthday. It was the lead and second lead news on the BBC News website. Seann’s now ex-girlfriend who had been shown in the audience on Saturday evening’s programme was understandably unimpressed and her public response to their public indiscretion is worth seeing as one of the best put downs I’ve seen for some time.

So why am I writing about this on the Employment Solutions blog. Well, there was an interesting case reported this month which cost an employer £24,000 for similar behaviour in work, albeit non-consensual.

Can there still be a TUPE transfer after a gap of five months?

The European Court (CJEU) decision in Jorge Siguenza v Ayuntamiento de Valladolid concerns the potential application of a transfer of undertaking (TUPE transfer in the UK) in a case in which there is a long gap between one undertaking ceasing its activities and another commencing. Mr Siguenza was employed as a music teacher at the Municipal Music School of Valladolid in Spain from November 1996. From 1997 to 2013 management of the school was provided by a contractor, Musicos y Escuela, on behalf of the local authority. In 2012-13, owing to a reduction in the number of pupils, the authority refused to pay the sums claimed under the contract by Musicos y Escuela, which therefore sought the termination of the contract and claimed damages. In response, in August 2013, the authority terminated the contract, alleging wrongful conduct by Musicos y Escuela because it had ceased its activities before the end of the contractual end date. In a series of judgments delivered in 2014 and 2015 the Tribunal Superior determined that the authority had breached the contract because it was committed to providing guaranteed payments irrespective of the number of students, so that failure to make those payments in full had caused the breach of contract.

In the meantime, in March 2013, Musicos y Escuela started consultations with a view to the dismissal of all its staff. Mr Siguenza and his fellow employees were dismissed on 4 April and the company was declared insolvent on 30 July.

In August 2013 the authority assigned the management of the school to In-pulso Musical and provided it with the use of the premises, instruments and equipment necessary for it to carry out its duties. In-pulso Musical commenced its management of the school in September 2013 for the 2013-14 school year and was awarded further contracts for 2014-15 and 2015-16.

Unfair dismissal claims by the former employees failed but Mr Siguenza brought a further claim before the social court. His claim was dismissed on the basis of res judicata (the matter had already been determined by the other court) and he appealed to the high court. In doing so, he contended that there had been a transfer of undertaking from Musicos y Escuela to In-pulso Musical so that his contract of employment should have been preserved. It was this aspect of his claim that was transferred to the CJEU.

Legal professional privilege can be lost if what is being discussed is “iniquitous”

Most people are familiar with the idea that legal advice is “privileged” from disclosure, i.e. that is remains private between the client and his or her legal advisers. In the United States that has become a hot issue concerning President Trump and those around him, not least his longstanding personal attorney and recent convict, Michael Cohen.

Nearer to home, the issue has been considered by the Employment Appeal Tribunal in the case of X v Y Limited.

“X” was employed by “Y” as a lawyer from January 1990 until his dismissal on 31 January 2017. X suffers from type 2 diabetes and obstructive sleep apnoea. Records showed that there were concerns about X’s performance at work from 2011. X complained that measures taken by his employer amounted to disability discrimination and/or failure to make reasonable adjustments. He raised a grievance in March 2016 and an outcome letter was issued in June 2016.

In the meantime Y announced a voluntary redundancy process. Having been unsuccessful in applying for certain roles, X was placed in a “redundancy consultation process”.

At his employment tribunal hearing the employment judge accepted that, in May 2016, X overheard a conversation at the Old Bank of England pub in Fleet Street. The conversation was the subject of a claim of legal professional privilege. X said that a group of professionally dressed people including two women in their 30s or 40s came into the pub. One mentioned a disability discrimination complaint by a senior lawyer at Y. She said that there was a good opportunity to manage X out by severance or redundancy because there was a big reorganisation under way.

In his claim X relied on the conversation to interpret an email that he was sent anonymously in late October 2016. The email had been sent by “A”, a senior lawyer, to “B”, a lawyer who had been assigned to Y. The content of the email was not read out in court at the initial tribunal hearing. X maintained that the email contained advice on how to commit unlawful victimisation by using the redundancy/restructuring programme “as a cloak to dismiss” X. Y maintained that the email was legally professionally privileged.

Y terminated the employment of X, ostensibly by reason of redundancy, by three months’ notice ending on 31 January 2017.

In the employment tribunal, Employment Judge Tsamados decided that the email “did not disclose a strong prima facie case of iniquity”. Legal professional privilege can be lost if what is being discussed in “iniquitous”, i.e. (according to the Employment Appeal Tribunal);

“…beyond conduct which merely amounts to a civil wrong; he has indulged in sharp practice, something of an underhand nature where the circumstances required good faith, something which commercial men would say was a fraud or which the law treats as entirely contrary to public policy.”

On appeal Mrs Justice Slade noted that Judge Tsamados did not take into account the conversation in the pub. She concluded that it was right not to do so because it was not authorised by Y and could not therefore assist in determining its position and because there was no contemporaneous note taken.

However, as far as the email was concerned, there were relevant background factors to be taken into account.

Can an employer impose a pay cut on financial grounds?

A recent case in the Liverpool Employment Tribunals has highlighted the risk for employers in unilaterally imposing pay cuts on employees in response to a downturn in business.

Mr Decker was a branch manager for a recruitment agency, Extra Personnel Logistics, specialising in driver recruitment for the logistics industry in Merseyside. He commenced employment in December 2008. On commencing his employment he worked 40 hours a week flexibly between 7.00 a.m. and 7.00 p.m. Monday to Friday. In July 2015 it was agreed that his working hours would be reduced to 32 per week. It was also agreed that he would be released from on call duties, other than covering holidays and emergencies.

On 20 February 2017 he was asked by the managing director, Brad Richardson, to reduce his working days from four to two (32 to 16 hours), equating to a loss of £205.95 per week. The following day Mr Richardson wrote to him, confirming the reduction to Mondays and Tuesdays only. He gave the reasons as the loss of two contracts and the industry market being quiet. The letter also informed him that the consultation period for the contract would run until 6 March, following which a meeting would take place the following day. Mr Richardson also referred to an offer of six additional hours doing sales which, although it had been declined by Mr Decker, would remain open for discussion.

On 3 March Mr Decker wrote to Mr Richardson to inform him that, due to his financial circumstances, he could not afford any reduction in his existing working hours and that he was willing to discuss matters further at the meeting on 7 March.

At the meeting Mr Richardson said that, as a result of the resignation of Mr Decker’s daughter in law (who had also been offered a reduction in working hours), he could offer a further eight hours per week. However, that was subject to him resuming on call work. Mr Decker said that he would accept the reduction from 32 to 24 hours if his day rate was increased from £102.97 to £110.00, on the basis that this would assist the employer in achieving its cost-cutting objective.

No agreement was reached at the meeting.

You leave this court without the slightest stain on your character, except…

disclosure and barringCRB checks, DBS checks or ECRCs, whatever they are called, criminal record checks have become an integral part of many employment and recruitment procedures.

The object is laudable: to protect children and vulnerable people from coming into contact from those who are unsuitable to be among them. However, a decision of the Supreme Court at the end of July has exposed an interesting aspect of enhanced checks that many people did not realise and which raises interesting questions concerning our justice system and how mere involvement in a criminal process without any finding of wrongdoing can still result in a disclosure which can call into question the suitability of the individual concerned.

The case concerned someone known as “AR” (he cannot be named for legal reasons, a qualified teacher who was found not guilty of rape in 2011 after a Crown Court trial.

Although he was found not guilty, details of the allegation and the verdict were included in his criminal records certificate. Following hearings on 21 November 2017 and 23 April 2018, Lord Carnwath delivered the judgment of the Supreme Court. The respondents were the Chief Constable of Manchester Police and the Home Secretary.

In a report into the operation of the criminal records legislation, its author Sunita Mason pointed out that there was:

“…a degree of dissatisfaction with a system that has evolved with the laudable aim of protecting vulnerable people but is now viewed by some as intrusive and an unnecessary bar to employment. There is also concern that some people may be treated as ‘guilty until proven innocent'”

As a result of her report there were amendments to the legislation including a right to request a review.

Pimlico Plumbers and other employment status news

Late last month the Supreme Court delivered its long-awaited if not altogether surprising decision in Pimlico Plumbers v Smith. It upheld the decisions of the lower courts that Mr Smith should properly be classified as a worker, with attendant rights (including discrimination rights and holiday pay), rather than being self-employed.

Gary Smith worked for Pimlico Plumbers for six years (from 2005-2011). Although he was VAT registered and paid self-employed tax, from an employment law perspective, he was nonetheless entitled to workers’ rights.

The judgment was unanimous and the lead judgment was provided by Lord Wilson. Having considered the history of the law concerning the status of workers (dating back to 1875), he considered the written agreements between Pimlico and Mr Smith (the original dated 2005 and a replacement issued in 2009), both of which he thought were confusing. However, he noted the extent of control exercised over Mr Smith including the right to dismiss him for gross misconduct, how he should provide his services, an obligation to provide advance notification of absences and the supply of tools. The second agreement included an obligation to wear Pimlico’s uniform, a minimum 40 hours’ working week, advance notice of annual leave and provision for warnings and dismissal.

He also noted that there was no provision for Mr Smith to appoint a substitute to do his work (other than by another Pimlico operative). Having considered relevant authorities, he concluded that “the dominant feature of Mr Smith’s contracts with Pimlico was an obligation of personal performance”.

There was an “umbrella contract” between Mr Smith and Pimlico whereby, if work was available to be done by him, he would be expected to do it. Nonetheless, Mr Smith correctly presented himself as self-employed for tax purposes.

Is it fair to dismiss for action which falls short of gross misconduct?

It is well known that dismissal can result from a single matter which is usually found to amount to gross misconduct, or as the result of more than one event, with the prior matters resulting in written warnings and/or a final written warning. Indeed, most disciplinary procedures outline this process and generally include examples of what will normally be treated as gross misconduct.

However, in Quintiles Commercial UK v Barongo the question for the Employment Appeal Tribunal (EAT) was whether it was fair for Quintiles to dismiss Mr Barongo for conduct which was initially classified as gross misconduct but subsequently downgraded to serious misconduct.

Quintiles supplies staff for pharmaceutical companies. Mr Barongo started working for them in October 2012 and was latterly engaged to sell drugs for Astra Zeneca. On 5 January 2016 he was dismissed on notice on two grounds. First, he had failed complete Astra Zeneca’s compliance training course by the deadline of 3 November 2015 and, second, failing to attend their compulsory training course on 19 November 2015. Mr Barongo did not deny the allegations and he also accepted that they amounted to misconduct on his part. However, he contended that he had been dealing with other matters. He said that he had not intentionally failed to engage with the training but he had chosen to priorities other matters. This had been at a time when he was on a performance improvement plan.

There was a disciplinary hearing conducted with his line manager which took place by telephone. As the EAT pointed out, conducting the hearing by phone might not have been best practice but it was not in itself unfair. His line manager concluded that the duty of trust and confidence which ought to exist between employer and employee had been broken and, as a result, Mr Barongo was dismissed on notice, for gross misconduct.

He appealed against the decision and the appeal was heard by one of the employer’s directors, Mr Athey, who took the view that there had been a breach of the duty of trust and confidence, but that it amounted to serious rather than gross misconduct.

Mr Barongo submitted a claim of unfair dismissal to the Employment Tribunal. The Tribunal took the view that the downgrading of the misconduct from gross to serious was highly significant:

How to deal with convictions for sexual offences committed by a person associated with the employee

Judgments of the Supreme Court concerning employment law issues are fairly infrequent and usually worthy of attention. That is certainly so in the recent case of Reilly v Sandwell Metropolitan Borough Council which concerned an individual convicted of the surprisingly common offence of downloading indecent images of children.

Ms Reilly was the deputy head teacher of a primary school. She was in a close but not sexual relationship with a Mr Selwood and they did not live together. In 2003 they bought a property in joint names as an investment and Mr Selwood lived there, although he did not make any payments to Ms Reilly. Ms Reilly did not live there but she occasionally stayed overnight, including on 24 February 2009 when, the following morning, she awoke to the arrival of the police who searched the property and arrested Mr Selwood on suspicion of having downloaded indecent images of children. In September Ms Reilly was promoted to the post of head teacher at the school and in February 2010 Mr Selwood was convicted of making indecent images of children by downloading. On a scale of 1-5, the images ranged from level 1 to level 4. He was sentenced to a three year community order, made the subject of a sexual offences prevention order (which included a ban on him having unsupervised access to minors) and he was required to take part in a sex offenders’ programme.

Ms Reilly was immediately aware of the conviction and sentence but chose not to disclose them to the school governors or the local authority. In June 2010 the authority became aware of the conviction and she was suspended on full pay. She was required to attend a disciplinary hearing, the allegation being that, in failing to disclose her relationship with a man convicted of sexual offences concerning children, she had committed a serious breach of an implied term of her contract of employment, sufficient to warrant dismissal for gross misconduct. Following a hearing in May 2011 she was summarily dismissed. The panel was particularly concerned that Ms Reilly continued to refuse to accept that her continued association with Mr Selwood might pose a risk to children at the school. Her appeal against her dismissal failed.

New GDPR compliant data protection

As I mentioned to readers of our monthly newsletter, like many organisations, we have been preparing for the implementation of the General Data Protection Regulation on 25 May 2018. As you may know, there is no transition period so the new rules concerning data protection will be in full force and effect from day one.

At Canter Levin & Berg we introduced our new data protection policy last week and we have recently published our template GDPR compliant data protection policy, with associated documents and guidance notes, in the subscription section of this website. The policy is intended to be straightforward and easy for all readers and users to understand.

As usual we have accompanied the policy with detailed background and guidance notes which are intended to demystify the compliance process for SMEs. We have explained the background to GDPR, provided a commentary on what the Information Commissioner says about preparing for GDPR and summarised the main areas that need to be considered.

We have provided a clause by clause summary of the policy so that our users have all that they need to adapt the policy for implementation in their organisations.

Of course, subscribers who have access to our employment lawyers can have them prepare a suitably adapted policy, as well as receiving advice about how to implement the changes.

The stakes are high when the wrongful dismissal claimant is the former boss of The AA

In June 2014, when The AA was taken public in what was described as a management buy-in, chartered accountant Bob McKenzie was appointed as its chief executive on a base salary of £750,000.

On 1 August 2017 he was sacked for gross misconduct after he was reported to have to have got into a hotel bar fight with one of the Company’s senior managers. He was reported to have engaged in “a sustained and violent attack” on the manager which was captured on the hotel’s CCTV. Days after the incident he was removed from the board. As a result of being dismissed for gross misconduct, thereby disqualifying himself from any further contractual benefits, he stood to lose what was estimated at the time to be about £100m in share awards. Following his dismissal Mr McKenzie admitted himself to hospital suffering from work related stress.

He was known as strong boardroom performer, driven by financial returns. In an interview with The Sunday Telegraph in 2016 he said of his employment prior to joining The AA:

“Work hard and play hard: you were given targets and you met them or else you parted company.”

Shortly following his appointment, chief executive Chris Jansen left abruptly, followed finance director Andy Boland. Mr McKenzie assumed the (much criticised) dual role of chairman and chief executive, assuming greater power in 2015 by absorbing the duties of executive director Nick Hewitt, architect of the business plan that led to the float, who also left abruptly.

Mr McKenzie instructed top City firm Bird and Bird and in January 2018 The AA declared that it was “astonished” that Mr McKenzie had commenced an unfair dismissal claim in the employment tribunal, with the intention of bringing a wrongful dismissal claim for “tens of millions of pounds” in the High Court.