Worked up, your monthly employment law lowdown – August 2020

It’s been a busy few months in the employment law sphere. Whether you’re an HR professional, in-house counsel or in a management role, the chances are you’ve had to turn your hand to a difficult HR conundrum.

Covid-19 has shaken up the employment law landscape. Employers have been forced to grapple with a multitude of new developments such as the Government’s Job Retention Scheme (with its constant stream of updates) as well as the crucial guidance on how to operate safely in the midst of a pandemic.

During this period, we’ve provided briefings on the employment developments relevant to those operating in the digital world which we hope you’ve found useful. Today, we’re pleased to announce the launch of our new monthly bulletin that will continue this initiative on a regular basis.

Worked Up will be with you at the start of each month and will ensure that you’re aware of the key developments and case law in this ever-changing area of the law. There will no doubt be a Covid flavour to some of our future updates but we’ll always aim to deliver content that is relevant to those operating in the media and technology sectors.

We hope you enjoy our inaugural edition which covers the recently announced Job Retention Bonus (this follows our previous briefing notes on the Job Retention Scheme which can be accessed here), the HR implications of the new Spanish quarantine rules, as well as some key takeaways from a few recent cases.

If you would like to discuss any of these updates, please do get in touch. Alternatively, if you would like to receive these updates directly to your inbox, please subscribe here.

 

This month’s headlines:

Job retention bonus – are you eligible (and would you even want to use it if you are)?

Spanish travel woes and the HR headaches

The employment status of athletes – can sporting bodies and teams now relax?

Confidential settlements – how valuable are they?

Reasonable adjustments – redundancy considerations

 

Job retention bonus – are you eligible (and would you even want to use it if you are)?

The Government’s job retention bonus is intended to reward and incentivise employers who continue to employ their furloughed employees. Eligible employers will be entitled to receive a one-off taxable payment of £1,000 for every furloughed employee who is:

  • continuously employed (and not under notice) from the end of their furlough leave until at least 31 January 2021; and
  • paid an average of at least £520 a month between 1 November 2020 and 31 January 2021.

Government guidance regarding the bonus can be found here and further guidance is due to be published by the end of September 2020.  Employers will be able to claim the bonus from February 2021.

However, a number of employers such as Primark and John Lewis have already come forward and said that they will not be claiming the payments and we expect they won’t be the only ones.  The scheme has been criticised for the fact that employers who had no intention of making staff redundant will qualify for the bonus payments.  It may also have the unintended consequence of incentivising employers to select for redundancy staff who have continued to work throughout the lockdown ahead of those who have been furloughed.

In any event, it is perhaps a little hopeful to expect that a payment of £1,000 will be enough to encourage many employers to retain staff who would otherwise be made redundant.  That said, it could conceivably make a difference in marginal cases.  No doubt time will tell how many employers make use of the scheme.  Whether it achieves the desired result of saving jobs will be more difficult to ascertain.

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Spanish travel woes and the HR headaches

Recent headlines have been dominated by the Government’s decision to change, without notice (as Grant Shapps can confirm), its rules relating to those travelling to or returning from Spain (and more recently Luxembourg).   Holidaymakers are now required to self-isolate for 14 days on their return to the UK and the Government has not ruled out making similar changes regarding other countries with Belgium the next likely candidate.

The Government has advised that employers should be flexible and that employees should not be penalised for complying with the rules on self-isolation.  This is all well and good, but it is not at all clear what legal protection these individuals might have.

In respect of pay, unless the employee is able to carry out their work from home, they will not be entitled to any form of pay during any quarantine period as the Government has made clear that Statutory Sick Pay will not be payable unless the employee is also required to isolate for another reason (e.g. because they have Covid-19 symptoms).  Employers will therefore need to decide whether they wish to offer any form of pay during quarantine periods or whether such periods will be unpaid.  Some employees may be willing to take annual leave or a combination of annual leave and unpaid leave to ensure that they have some pay and in some cases it may be possible for employers to re-furlough employees.

Aside from the question of pay, we would not be surprised if some employers now decide to introduce policies prohibiting employees from going on holiday to countries which either are or are at risk of being included within the quarantine rules.  Such decisions would need to be considered carefully and could potentially result in liability if an employee ended up losing money as a result of having to cancel a holiday at short notice.

While employers will no doubt be rushing to communicate arrangements to those shortly due to return from Spain, it may be worth considering generally whether it is now appropriate to put in place a formal quarantine policy so that staff know what to expect in the future.

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The employment status of athletes – can sporting bodies and teams now relax?

Professional cyclist was not a worker or an employee
Varnish v British Cycling Federation (t/a British Cycling) UKEAT/0022/20/LA

As widely reported, the appeal brought by the former European team sprint champion and world silver medal cyclist, Jess Varnish, has recently been dismissed by the Employment Appeal Tribunal (EAT).  She had appealed against a finding by the Employment Tribunal that she was neither an employee nor a worker of British Cycling and UK Sport.

Varnish had sought to bring claims of unfair dismissal and discrimination after being dropped from the UK elite cycling programme. Her claims were dismissed on the ground that she was neither an employee nor a worker due to a lack of mutuality of obligation – she wasn’t personally performing work provided by British Cycling but was instead performing a commitment to train. Our previous summary of Varnish’s initial employment claim can be found here.

As we suspected at the time, there were no obvious avenues open for her to challenge the original decision.  Varnish appealed the decision on the grounds that: (1) the Tribunal erred in law in finding that there was no mutuality of obligation; (2) the Tribunal erred in concluding that she was not a worker; and (3) the Tribunal’s reasoning was irrational in relation to certain findings of fact. All three grounds failed as the EAT found that the Tribunal had not erred in law and that the findings of fact identified under ground 3 were not determinative and did not undermine the Tribunal’s overall conclusion.

While this result was not surprising, the EAT did note that “the Tribunal’s conclusion does not mean that in another case, where perhaps the contractual provisions, and the balance between services provided to and performed by the athlete, are different, the training done by a cyclist could not be found to amount to work”. This demonstrates the fact specific nature of cases like this and therefore leaves the door open for other professional sportspeople to bring similar claims.

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Confidential settlements – how valuable are they?

Breach of a confidentiality clause in a settlement did not entitle the employer to cease making further settlement payments
Duchy Farm Kennels Limited v Graham William Steels [2020] EWHC 1208 (QB)

In this case, the High Court was required to consider whether a breach by an ex-employee of a confidentiality provision in a COT3 agreement (a form of agreement used to record a settlement reached through ACAS) entitled the employer to cease making the agreed settlement payments.  The High Court held that it did not.

The court found that the breach (which involved the employee disclosing the fact of the settlement and the amount of the settlement to a former colleague) did not entitle the former employer (“Duchy”) to treat the agreement as having been terminated so Duchy was liable to pay the remainder of the settlement payments. The main reasons for this were that: 1) the confidentiality provision had not been identified as a “condition” of the agreement; and 2) the breach was not serious enough to amount to a fundamental breach of contract.

While this case considered settlement payments in the context of a COT3 agreement, the same principles will almost certainly apply to standard settlement agreements.  Given that confidentiality will invariably be a key requirement of most settlement deals, this case has the potential to cause considerable concern for employers.

When drafting such agreements, it is now crucial to explicitly state that confidentiality is a condition of the agreement.  Or better still, the agreement should set out what will happen in the event of a breach of the confidentiality provision, for example, confirming that all or part of the settlement payment would need to be repaid or (where relevant) that future instalments would be withheld.

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Reasonable adjustments – redundancy considerations

Undertaking to give a severance package would have been a reasonable adjustment for a disabled employee
Hill v Lloyds Bank plc UKEAT/0173/19/LA

What does and does not constitute a reasonable adjustment for the purposes of the Equality Act 2010 has always been a tricky question and this case is a perfect illustration of that.

The EAT was asked to consider whether it was reasonable for Lloyds Bank to undertake that an employee would not work or interact with two individuals who had allegedly bullied and harassed her and that in the event that this wasn’t possible, to ensure that she could leave employment with a severance package equivalent to those offered under its enhanced redundancy terms.

Perhaps surprisingly, the EAT held that there was no objection in principle to the Tribunal recommending such an adjustment.  Where a disabled employee was suffering from anxiety at the prospect of having to work with certain individuals, giving this undertaking was reasonable as it would likely alleviate the employee’s fear and anxiety.

While this decision appears to suggest that the duty to make reasonable adjustments is much wider than many may have previously thought, the EAT did note that cases where it might be suitable for the Tribunal to make such a recommendation were “perhaps rare”. Also, while not mentioned explicitly, it is likely that the EAT had regard to the size and resources of Lloyds Bank and would not have suggested a similar adjustment for a smaller business. Nevertheless, this case highlights the challenges employers face when considering what adjustments might be reasonable.

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