Jones Chase’s 2021 Employment Law Highlights

1. Beware of quick fixes to systematic issues

In the case of Bayfield and another v Wunderman Thompson (UK) Ltd and others (ET), Wunderman Thompson (UK) Ltd learnt this lesson this hard way, when they dismissed as redundant two male creative directors after making reference in a company conference to wanting to obliterate its reputation that it was full of “white, British, privileged, straight, men”. This was after publishing what was described as a horrible and embarrassing gender pay gap.

The Tribunal held the redundancies to be unfair and discriminatory on grounds of sex.  This case acts as a reminder that seeking to fix systemic issues overnight is unlikely to work.  There are only very rare circumstances where positive action is possible and if you are thinking about this in your business, legal advice is recommended.

2. Has your equality and diversity training become stale?

In the case of Allay (UK) Ltd v Gehlen (EAT), the employer, Allay (UK) failed to argue a section 109(4) Equality Act 2010 defence, to an allegation of racial harassment by Mr Gehlen.

This is where an employer can defend an allegation that they are vicariously liability for offences committed by one of their employees, if it can show it had taken all reasonable steps to prevent an alleged harasser from doing “that thing” or “anything of that description” for example from acting in a discriminatory way.  This is ordinarily evidenced through the use of policies, anti-bullying and harassment training and equality and diversity training.

In this case the EAT rejected the employers “all reasonable steps” argument on the basis that diversity training was provided to employees, including the alleged harasser, almost two years prior to the alleged discriminatory conduct and so would no longer be effective to prevent harassment in the workplace. The EAT referred to the training as ‘stale’.

The take home from this is that you need to carry out regular anti-bullying and harassment training; equality and diversity training; and refresher training, online and in person (which can include live zoom sessions) to promote a non-discriminatory workplace. This case also demonstrates the threshold needed to succeed in defending a claim of harassment using the “all reasonable steps’’ defence. 

3. Wake up to Menopause at work

This is an area of Employment Law that gained significant traction in 2021 and Jones Chase delivered a free webinar on the topic last year (which is also available in the News and Events section on this website).  The case of Rooney v Leicester City Council (EAT) is just one example of a case last year where it was found that the Claimant, Ms Rooney, had a disability pursuant to the Equality Act 2010 due to the symptoms of the menopause.

It is expected that claims of this nature will continue to increase and whilst the case law in this area develops, employers should be alert and make sure that line managers are alive to how menopausal symptoms can impact an employee’s wellbeing, performance and attendance.

This is not only important to reduce the risks of a claim, but as highlighted by a recent independent report commissioned by the Government, almost 1 in 4 women end up leaving the workforce, and 25% consider giving up work, as a result of the impact of the menopause, so it is also important if you want to retain talent.

4. Agree the changes if you want your Christmas bonus and the tale of an unlawful inducement

In the case of  Kostal UK Ltd v Dunkley and others (Supreme Court), Kostal UK Ltd sought to bypass collective bargaining with the recognised trade union, by offering a package of pay increases and a Christmas bonus, alongside some detrimental changes to terms and conditions, directly to their employees, after it was rejected by the trade union’s members in a ballot. They also posted a notice stating that if the employees did not agree to the new terms, they would forfeit their Christmas bonus and then subsequently wrote to their employees to say that if they did not agree, their contracts may be terminated.

A number of Unite members were successful in their Employment Tribunal claims, alleging that each letter constituted an unlawful inducement contrary to section 145B of the Trade Union and Labour Relations (Consolidation) Act 1992.

The Supreme Court did however confirm that there is nothing to prevent an employer from making an offer directly to its workers in relation to a matter which falls within the scope of a collective bargaining agreement, provided that the employer has first followed, and exhausted, the agreed collective bargaining procedure.

5. Assess your practices or accept the risk – off-payroll working in the private sector (IR35)

After the delay in April 2020, the updated IR35 rules were finally introduced to the private sector in April 2021. Although not an entirely new concept, the changes introduced in April 2021 had fundamental implications for large and medium sized businesses who use consultants operating via a personal service company (PSC), also known as contractors.

Previously, the onus was on the PSC to determine if IR35 applies by determining a contractor’s employment status for tax purposes, operating PAYE tax and paying employer’s National Insurance Contributions (‘NICs’) if it does.  In April 2021 the burden shifted to any non-exempt business that hires consultants via PSCs, with the effect that the organisation may become responsible for paying PAYE and NICs on their behalf.  This can amount to a significant financial burden, plus lead to HMRC imposing interest and penalties on payments going to contractors that are caught by the new regime.

Given the above risks, we strongly recommend that all employers caught by the new rules have their relationships with their consultants reviewed, to avoid a potentially huge financial penalty down the line.  We would be happy to help in this regard, if needed.

6. To vaccinate or not to vaccinate? No longer an option for care home staff

Under the Health and Social Care Act 2008 (Regulated Activities) (Amendment) (Coronavirus) Regulations 2021, all care home workers, and anyone entering a care home, will need to be fully vaccinated, unless they are exempt under the regulations, for example for medical reasons.

7. Childcare responsibilities – who bears the greater burden?

Three cases heard this year, Dobson v North Cumbria Integrated Care NHS Foundation Trust (EAT), Thompson v Scancrown Ltd (ET) and Bryan v Landmarc Support Services Ltd (ET), act as a healthy reminder that women will often have success claiming indirect sex discrimination on the basis of childcare responsibilities. This is due to the accepted and well known childcare disparity between men and women.

As such, employers must be mindful of any provision, criterion or practice, that adversely affects working mothers compared to men.  This could include a requirement to work full time, to work certain hours or to be based from the office.

Again, we recommend that employers review their rules and practices to identify if any particular aspects of how the business operates adversely affects working mothers.  Changes can then be made ahead of a costly discrimination claim (or claims) and we would be delighted to assist with this exercise, if needed.