#13684 - Employment Law Notes - BPC Employment Law

Employment Law: LGS Notes

1.

Sources and definitions

Sources

1. Contract Law (or tort, e.g. vicarious liability)

• Same as contract law – offer, acceptance, consideration, etc.

• Does not have to be written – verbal contracts are valid but harder to prove

2. Domestic Legislation

• Implies terms into contract or overrides terms in contract

  • Why?

    • Balance of power relationship – to balance the power held by employer

3. EC Legislation and Case Law

• EC Legislation

• ECJ Judgments

• Fundamental principles in EC Treaties

Definitions

• Type of worker:

  • Employee:

    • Individual under contract of employment

  • Self-employed:

    • Under a contract for services

  • Worker:

    • Can include employees but also others who personally perform work/provide services but not SE because not carrying on business in own right

• Tests:

  • Hall v Lorimer

    • Look at the overall picture even where certain factors missing

  • Mutual obligations

    • both employee and employer are under obligations to one another

  • Control

    • Does the employer control/have authority over the employee in the performance of the work. Employee does not control who does the work (i.e. send someone to fill in)

  • Integration

    • Integrated into employer’s organisation

• Cases:

  • Dacas v Brook St Bureau Ltd. [2004]

    • C worked as cleaner at Council offices for 5 years as an agency worker. Was rude to member of staff and fired. C took action against agency and council.

    • Held: not employee but it is possible for an agency worker to be an employee.

    • Dramatic effect because employers will have liability for agency workers.

  • James v Greenwich Council [2008]

    • Upheld Dacas but whether there is liability will depend on the facts of each case.

• Advantages of being an employee:

  • Unfair dismissal protection

  • Redundancy payment

  • Maternity rights

  • Protection from discrimination

  • Written particulars of employment

Express/Implied Terms and Post Termination Restraints

1. Express Terms

• S.1 Employment Rights Act 1996

  • At beginning of employment, employer must give written statement of particulars of employment within 2 months

  • Can bring claim asserting failure but failure does not give rise to claim on its own

  • Written particulars which statement must contain:

    • Names

    • Dates

    • Continuous employment periods

    • Pay

    • How calculated

    • Hours

  • S.2(4) ERA – some items must be in ONE document:

    • Names

    • Date of commencement

    • Date of continuous service

    • Rate and frequency of pay

    • Hours of work

    • Holiday entitlement

    • Job title

    • Place of work

• If no formal contract or written particulars, can gather other evidence to demonstrate contract

  • E.g. offer letter, handbook and policies, job advert

• Other terms may appear

  • Garden leave

  • Suspension without pay

  • Mobility clauses

    • I.e. may be required to work somewhere else.

  • Variation

  • Right to search

  • Restriction of email/internet

2. Implied Terms

• Implication by:

  • Statute

  • Custom/past conduct

  • Officious bystander test

  • Business efficacy

• Duties upon employer as implied conditions

  • To pay

  • To provide work

    • Arguably no longer exists as long as payment is given. Depends on facts of case, e.g. actor is dependent on publicity from work despite pay

  • Health and safety

    • Reasonable care for employee. Common law, statutory and tortious duties

  • References

    • Duty to take reasonable care if reference given (no duty to provide one)

  • General duty of care

    • Difficult to run

• Mutual duties upon employer and employee

  • Trust and confidence

    • Physical/verbal abuse

    • Harassment

    • Deception

    • False accusations

• Duties upon employee

  • To provide personal service

  • Reasonable skill, diligence and care

  • Good faith and confidence

  • Duty to obey lawful orders (if reasonable)

3. Post termination restraints

• Confidential information

  • Duty can extend beyond contract but is more narrow. Must be:

    • Trade secret; OR

    • So highly confidential as to amount to a trade secret

• Trade secret

  • Faccenda Chicken v Fowler [1996]

    • Look at circumstances to decide what trade secret is.

      • Nature of employment

      • Nature of information

      • Whether employer impressed upon employee the confidentiality

      • Whether information could be isolated from other information which can be disclosed

4. Restrictive covenants

• To prevent someone from doing something once relationship broken down

• Court does not like control of behaviour after contract. Some allowed.

• Prima facie VOID and UNENFORCABLE, UNLESS:

  • No further than necessary

  • Protect legitimate interests of business

  • Reasonable

• Types:

  • Non-competition

  • Non-dealing

  • Non-solicitation/poaching of customers or employees

• Blue pencil test

  • If term too wide but can easily be amended, court will do so

  • Will not redraft a clause

• Reasonableness factors:

  • Duration of restriction

  • Geography

  • Needs/interests of business

  • Duties of the employer

  • Whether a lesser restriction would suffice

• The impact of wrongful dismissal on restrictive covenants

  • If dismissed in breach of contract or constructive dismissal, restrictive covenant is unenforceable

• Remedies

  • Damages

  • Injunctive relief

Termination and Wrongful Dismissal

1. Termination

• Not every contract termination = dismissal

• Ways of ending:

  • Mutual agreement – not dismissal

    • Where financial inducements, far more likely that mutual agreement because leaving is of benefit to employee.

  • Fixed term contracts - dismissal

    • S.95(1)(b) ERA

      • Expiry of fixed term contract without renewal = statutory dismissal

    • Can be expiry of time, completion of task or occurrence of a particular event

    • Fixed-Term Employees (Prevention of Less Favourable Treatment Regulations) 2002

      • Extra protection for fixed term employees:

        • Right to be treated as favourably as permanent employee

        • Protection against UD

        • Right to information about permanent vacancies

        • One week statutory minimum notice for contracts of 3 months or less

    • Series of fixed term contracts

      • Employees under a series of FT contracts for 4 years + will become permanent employees unless continuing as FT can be objectively justified

  • Frustration – not dismissal

    • Where:

      • Contract is impossible; OR

      • Circumstances of performance would render performance radically different from what was originally intended, e.g. imprisonment

  • Dismissal by employer

    • Contractual and statutory notice

      • Either give contractual notice; OR

      • SMN (statutory minimum notice) – if contract silent or is less than SMN

        • 1 month but less than 2 years – 1 week

        • 2 years but less than 12 years – 1 week for each complete year

        • More than 12 years – capped at 12 weeks

    • PILON (payment in lieu of notice)

      • Can be express clause = PILON is allowed

      • IF not express and employee does not consent = breach of contract

      • Tax:

        • If PILON paid from contractual right (i.e. express) = payment and is taxable

        • If no PILON clause = not contractual and considered damages, therefore untaxable up to 30,000

  • Summary dismissal

    • Payment without notice or PILON because of serious breach of contract (repudiatory breach)

      • E.g. wilful disobedience, theft, drunkenness, bullying, etc.

    • Employer can rely on further misconduct discovered after dismissal in claim for wrongful dismissal but NOT unfair dismissal

  • Constructive dismissal

    • S.95(1)(c) ERA – deemed dismissal

      • Behaviour of employer has been so bad to cause contract to end. I.e. I am leaving because your behaviour has dismissed me

    • Must be:

      • Serious breach

      • Entitling employee to treat contract as ended

      • BoP on employee that there was serious breach AND resignation was as a result

    • Can give rise to claim for damages – contractual basis, and/or statutory damages for unfair dismissal

  • Resignation – not a dismissal

2. Wrongful Dismissal

• If employer:

  • Breached terms or

  • Failed to give notice

    • = breach and wrongful dismissal

• Will need to pay compensation to put employee in position as if no breach (contractual basis)

  • i.e. notice period and/or damages

• Wrongful dismissal:

  • Common law

  • Breach of contract

  • Dismissal without justification

  • Contrary to express or implied terms of contract

• Damages for loss of reputation

  • Could theoretically be included

  • Includes duty to mitigate

2 and 3

Unfair Dismissal

Eligibility

• Individual must:

  • Be an employee (not SE or a worker)

  • Have the relevant continuous employment – i.e., when employment began

    • Before 6^th April 2012 – 1 year

    • After 6^th April 2012 – 2 years

  • Commence the claim within 3 calendar months of dismissal

    • 3 months of EDT (“effective date of termination”)

    • Date of dismissal…jump back 1 day and add 3 months

    • Date of dismissal, not date of appeal unless contract provides for continuing service until determination of appeal

  • Not be an excluded category

    • E.g. police, armed forces

• EDT

  • Can be:

    • When notice expires (if given)

    • Date of dismissal if not notice

    • Date of PILON payment

    • Expiry of fixed term contract

  • Possible to extend?

    • At tribunal discretion – unusual

    • Test:

      • Not reasonable and practicable to present within 3 months

      • C to prove

    • Present claim within such further period as the Tribunal considers reasonable in order for an extension

Dismissal

• Express, with or without notice

• Expiry of fixed term contract

• Constructive dismissal, e.g.:

  • Reduction in pay – Industrial Rubber Products v Gillon

  • Complete change in nature of job – Ford v Milhorn Toleman Ltd.

Fairness – limb 1

• 5 acceptable reasons to dismiss

• IF not one of the reasons, dismissal is unfair

  • Capability

    • Qualifications lacking

    • Illness prevents work

    • Incompetence

  • Conduct

    • Need not be gross misconduct

    • Can include conduct outside working hours

  • Redundancy

    • Job or place of work goes

  • Illegality

    • Rare – e.g. driver loses his licence so continuing job is illegal

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