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Employment Law Newsletter – December 2013

Welcome to our December 2013 Employment Law Newsletter, keeping you up to date with changes in employment law and informing you of recent case law developments.

CASE LAW DEVELOPMENTS

How important is a diagnosis to a disability discrimination case?

‘Very important ‘ – held the case of Cox –v- Essex County Fire and Rescue Service (“Cox”).

In the Cox’s case, the Employment Appeals Tribunal (“EAT”) upheld a Tribunal’s decision that despite an employee advising his employer that he was suffering from a bipolar disorder, the absence of a “definitive diagnosis” meant that the employer did not know, or could not have been reasonably expected to know that the employee was disabled.

The Fire Service summarily dismissed Mr Cox with effect from 9 February 2010 due to allegations of aggressive behaviour. Mr Cox brought claims of unfair dismissal and disability discrimination. The Fire Service had attempted to obtain disclosure of the relevant medical evidence from Mr Cox’s GP and Specialist; however, due to an existing personal injury claim and upon advice from his Personal Injury solicitor, Mr Cox withdrew consent for disclosure of his medical evidence. Therefore, the EAT found that the Fire Service had been justified to treat Mr Cox as not disabled. 

This case serves as a reminder to employers that if an employee fails to fully co-operate with your attempts to obtain medical evidence on their condition, it may mean that you lack the requisite knowledge of what an employer needs to (actually or constructively) know that an employee is disabled. An employer can therefore reach a decision in absence of this information, which in this case was to the employee’s detriment. However you must always proceed with caution as these cases turn on particular facts of each case.

Fairness of Dismissal for Assault

In CJD v Royal Bank of Scotland [2013] the Court of Session has reinstated a tribunal’s decision that an employee, dismissed for an alleged domestic assault on his partner (who also happened to be his colleague), was unfairly dismissed.

Since the dismissing officer accepted that the employee had acted in self-defence, it could not be said that he believed in the employee’s culpability. In these circumstances, the tribunal had been entitled to find that the employer had not established that the reason for the employee’s dismissal was misconduct. In any event, the employer’s investigation was inadequate and unreasonable. The employee did not succeed with his claims of sex discrimination.

This case emphasises the importance of conducting a thorough investigation and that you should take care when dismissing for conduct out of working hours.

John McCririck – Age Discrimination claims

The Tribunal held that Channel 4′s decision to remove John McCririck as a presenter of Channel 4 Racing was not direct discrimination on the grounds of his age. The decision was made because of his image and presenting style rather than his age.

Although the Employer was successful in this case the reasons for dismissal were similar to another case in which the employee was successful. It is therefore extremely important to take care when dismissing for reasons that could be interpreted as age related.

Non-solicitation covenant valid despite wide scope

In Coppage v Safetynet Security Ltd [2013] the Court of Appeal has dismissed the appeal of a former employee and director who had been ordered to pay at least £50,000 following a breach of his post-termination restrictive covenants.

The restriction within his contract of employment prohibited the solicitation of any customers of his former employer for a period of six months following termination. The employee felt this was unreasonable because it applied to all customers he dealt with during employment. It was decided that the restriction was reasonable, despite its breadth, as the restriction only applied for six months after termination.

This decision is a valuable reminder that cases such as this will turn on the particular facts of each case and that there are no hard and fast rules regarding enforceability.

Team moves – Employee breached duty of fidelity

In Thomson Ecology Ltd and another v APEM Ltd [2013] a senior employee sought to transplant his employer’s business to a competitor. His plan included taking over the employer’s premises, incorporating a company with a similar name, registering similar domain names and facilitating the recruitment by the competitor of a substantial section of the employer’s workforce.

In the absence of any post-termination restrictive covenants, or any express terms regarding confidential information, the employer brought claims against the employee for breach of his contractual duty of fidelity and a fiduciary duty of loyalty (based on his seniority), and against the competitor for passing off. The court found that the employee had broken his implied duty of fidelity by failing to inform the employer of the planned poaching raid, discussing confidential information about staff salaries with the competitor, arranging meetings with his colleagues at his home to discuss offers of employment from the competitor and colluding with the competitor in identifying and recruiting members of staff.

This case will be useful for employers wishing to take action against employees planning to compete against them, especially those doing so before they have left employment.

LEGISLATIVE DEVELOPMENTS

Judicial Review of the Unfair Dismissal Compensation Cap

The Government introduced a cap on unfair dismissal compensation of the lower of the current cap (£74,200) or one year’s gross pay at the Employment Tribunal, which came into force on 29 July 2013. A London employment law firm Compromise Agreements Limited has lodged an application for judicial review seeking to quash the introduction of the cap in cases of unfair dismissal.

The firm’s basis of the application for judicial review, are that older people are more likely to be out of work for more than a year and therefore should be eligible for more than a year’s salary. Further, the firm believes that many older potential claimants will be put off from bringing a claim due to this cap and it is therefore indirect discrimination in relation to access to justice.

The introduction of a cap on unfair dismissal compensation was a welcome piece of legislation from the Government for employers; however, how successful this application will be is yet to be seen. Watch this space…

Draft TUPE regulations published

The government has published the draft Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2013.

The most significant changes to the draft regulations will allow:

  • Transferees to collectively consult with transferring employees before the transfer if the transferor agrees;
  • Post-transfer changes to location can amount to an ETO reason so that redundancies due to a simple change of location will not be automatically unfair.

 The draft regulations are expected to come into force in January 2014 and are likely to apply to any transfers after that date.

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