#16798 - Unfair Dismissal Including Empirical Data

UNFAIR DISMISSAL

QUICK SUMMARY:

Unfair Dismissal:

Are they an employee (work under contract of employment)
Qualifying period (2 years)
Dismissal- ER terminates w/o notice or ER is dismissed.
Reasons- potentially fair and was it reasonable for ER to treat the reason as sufficient reason for dismissing the employee? (burden on ER).
Was it procedurally fair? (inc Breach of ACAS code)- breach of ACAS code isn’t inherently unfair, just get statutory uplift.
Remedies- reinstatement, re-engagement, compensation (basic award- based on job security+ length of service, compensatory- s123). Also Polkey- even if dismissal was procedurally fair, would’ve dismissed anyway so damages reduced.

Wrongful Dismissal:

Dismissal w/o notice period.
Gunton Extension

Then if relevant:

Stigma- Malik
Express Procedure Breached- Edwards
Psych- Johnson, Eastwood.

Legal intervention warranted: dismissals generate social costs for employees, governments and taxpayers e.g govs regulate employment relationships by restricting range of feasible contracts+ raise costs of laying off workers+ increasing hours of work. However:

Botero et al: ‘heavier regulation = lower labour force participation and higher unemployment’.

Epstein- takes neoclassical approach- unfair dismissal laws impact on efficiency+ dynamism of markets
Argues in favour of US ‘employment at will’ approach: EE or ER can terminate at any time even w/o cause and w/o reasonable notice. Freedom of contract advances individual autonomypromotes efficiency of market. Critics don’t look at the nonlegal means of preserving long-term employment relationships. Says flexibility from contract at will good for technological+ business change. …‘The strength of the contract at will should not be judged by the occasional cases in which it is said to produce unfortunate results, but rather by the vast run of cases where it provides a sensible private response to the many and varied problems in labour contracting’.

Argues in favour of US ‘employment at will’ approach: EE or ER can terminate at any time even w/o cause and w/o reasonable notice.

Freedom of contract advances individual autonomypromotes efficiency of market.
Critics don’t look at the nonlegal means of preserving long-term employment relationships.
Says flexibility from contract at will good for technological+ business change.
…‘The strength of the contract at will should not be judged by the occasional cases in which it is said to produce unfortunate results, but rather by the vast run of cases where it provides a sensible private response to the many and varied problems in labour contracting’.

Contrast the neo-classical economists with new institutional economists.

NIE’s are unconvinced with economic arguments that markets always produce efficient outcomes.

Freyen and Oslington – Australian research that noted a relaxation in protective legislation did not have any real effect on economic costs to businesses.

Data often skewed coz OECD publishes stats on rigidity of unjust dismissal laws consulted by MNCsMNCs prefer to invest in countries with lower unfair dismissal costsincentivises jurisdictions not to implement inflexible laws that deter inward investment.

Structure, nature, content and shape of unfair dismissal laws:

When policy decision made to offer protection, need to determine the form/content of the protection.

Job security – regulation functions to entrench the position of an employee in a job as effectively as possible or to offer sufficient monetary compensation in return for the recognition of the employer’s power to dismiss (ie UK’s wrongful dismissal laws)- nb this is weak form.

Strong form of job security:Human right not to deprive EE of job, state treats dismissal as void.

Employment security – concession that, during their working lives, employees will be expected to adapt to changing methods of work, to reskill and even to lose their jobs.
Collins – innovation/technological change = employment security should be prioritised over job security to ensure economies remain competitive. Invest in training etc to reduce period between works.

UK policy in favour of employment security/enhanced employability over job property/security. Why?

EU policy has focused on desire to achieve ‘flexicurity’ – sees employment engagement in a transitional sense, representing opportunity to acquire skills before moving to engagements with other employers.
‘Range of reasonable responses test’ – standard of review is at a lax level. Part of a broader shift from substantive fairness to procedural fairness which highlights judicial abandonment of job security.
Disinclination of tribunals/courts to order reinstatement or re-engagement of unfairly dismissed employees in terms of power conferred upon s113-115 ERA 1996

From April 2016-April 2017 – employment tribunal statistics reveal that reinstatement/engagement in only 3 cases out of 5, 241 which proceeded to tribunal.

UK adoption of ILO Recommendation 119 of 1963 on the termination of employment provided impetus to provide greater protection, which is now enshrined in Part X of the ERA.

The first unfair dismissal statutes were implemented to try and stop industrial action. Lots of strikes were occurring in response to dismissals.

However, employees no longer needed unions to pursue claims as they could go through tribunals. Now that unions are in decline and the tribunal fees have done up, the unfair dismissal regime is extremely weak.

ERA 1996 Part X

Simple explanation of the process:

Show employment tribunal that he is eligible to present complaint of unfair dismissal by satisfying essential crtieria and employee must not fall within an excluded category.
EE must show they’ve been dismissed in terms of definition in s95(1) ERA.
If EE does this onus shifts on ER to show it had a valid reason for dismissal of employee (s98(1),(2),(3) ERA OR
EE can seek to proe that the reason for their dismissal was automatically unfair.
Reasonableness of dismissal examined s98(4)

S94 ERA: “Employee has the right not to be unfairly dismissed”

What does that actually mean? Right to have claim heard? There is no reengagement/re-instatement offered. Clear indication of how weak the legislation really is.

S111 ERA: “Complaint may be presented to an employment tribunal against an employer by any person that he was unfairly dismissed by the employer”

Implication = not in Court. Parliament intended specialist employment tribunals to deal with claims.

Eligibility to Claim

ESSENTIAL CRITERIA

Must be an employee (s.94(1) ERA). -not self-employed/indy contractor!

NB: s205a(2)- - Employee shareholders don’t have right to be unfairly dismissed.
s.108(1) ERA; s.97 ERA - Must have been in continuous employment for not less than 2 years, ending with the effective date of termination.

Exception 1 -s108(4) ERA: someone who alleges dismissal on basis of political affiliation does not need the 2 years minimum service

This change resulted as a result of Redfearn v UK where bus driver serving predominantly local area dismissed for taking over BNP position. Held to violate Art 10 ECHR.
Exception 2: S48 Defence Reform Act – no 2 yrs needed for employees in army,navy,RAF.

Ex parte Seymour Smith (1999)
2yr rule challenged on grounds of indirect discrimination against women as harder to clock up 2 yrs continuous service but held that even if indirectly discriminatory justified on public policy of rewarding longer service.

Complaint must be presented within 3 months, beginning with effective date of termination (s.111(2) ERA).

Longer period where not reasonable practicable for claim to be presented prior to 3 months.

No longer necessary to establish a weekly hours threshold;, ex parte EOC [1994]
Need to be working inside the UK. Further light shed on this requirement in:

Lawson v Serco Ltd [2006]-shows you can’t just point to British nationality or works for a company headquartered in GB to get protection
Hoffman in HoL divided employees into 4 camps who would benefit from unfair dismissal protection ‘Standard case: working in Great Britain’ @ time of dismissal, generally work in GB, occasionally abroad. ‘Peripatetic employees’ eg airline pilots, international consultants etc. Where the place of employment is at date of dismissal relevant, rather than where they actually are. ‘Expatriate employees’ – employees posted abroad by British employer for purposes of business carried on in GB or operating within an extra-territorial British enclave in a foreign country. Exceptional case of other expatriate employees with ‘equally strong connections with GB and British employment law’- e.g expat school teacher yet Afghan interpretors engaged by British Gov to work exclusively in Afghan didn’t (Hottak) Insufficient for an employee simply to point to his/her nationality or fact that he/she works for a company or another organisation registered or HQ in GB.

Hoffman in HoL divided employees into 4 camps who would benefit from unfair dismissal protection

‘Standard case: working in Great Britain’ @ time of dismissal, generally work in GB, occasionally abroad.
‘Peripatetic employees’ eg airline pilots, international consultants etc. Where the place of employment is at date of dismissal relevant, rather than where they actually are.
‘Expatriate employees’ – employees posted abroad by British employer for purposes of business carried on in GB or operating within an extra-territorial British enclave in a foreign country.
Exceptional case of other expatriate employees with ‘equally strong connections with GB and British employment law’- e.g expat school teacher yet Afghan interpretors engaged by British Gov to work exclusively in Afghan didn’t (Hottak)

Insufficient for an employee simply to point to his/her nationality or fact that he/she works for a company or another organisation registered or HQ in GB.

However, this prescriptive approach has been marginalised since Ravat [2012] where HOL said this list was not exhaustive.

Ravat v Halliburton (2012)
‘Starting point is the employment relationship must have a stronger connection with GB than with the foreign country where the employee works…it will always be a question of fact and degree as to whether the connection is sufficient strong to overcome the general rule that the place of employment is decisive’. -A clause in the employment contract which provides that Eng law governs any contractual disputes b/w parties is a relevant consideration in determining the territorial jurisdiction of employment tribunal 4 a UD case.

‘Starting point is the employment relationship must have a stronger connection with GB than with the foreign country where the employee works…it will always be a question of fact and degree as to whether the connection is sufficient strong to overcome the general rule that the place of employment is decisive’.

-A clause in the employment contract which provides that Eng law governs any contractual disputes b/w parties is a relevant consideration in determining the territorial jurisdiction of employment tribunal 4 a UD case.

EXCLUSIONS

Exclusions from the right to claim

EE dismissed for reasons of national security is excluded (s.10 Employment Tribunals Act 1996).
EEs governed by dismissal procedures agreement entered between independent TU and ER which is designated by order of the SoS as satisfying certain criteria will be excluded (s.110 ERA).
Right not to be unfairly dismissed doesn’t apply to share fishermen and police officers (s.199/200 ERA).
Certain employees, such as certain Crown servants and domestic servants in a household where the employer is a close...

#16798 - Unfair Dismissal Including Empirical Data - Labour Law

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