November 20th 2013

Welcome to Endeavour Partnership’s
November E-brief

In this issue:

•  Employee misconduct: carrying out a reasonable investigation

•  Dealing with employee grievances: the right to be accompanied

•  Dismissing an employee for gross misconduct after an inadequate investigation was victimisation

•  Redundancy: refusing suitable alternative employment

•  Flexible working, indirect sex discrimination and internal appeals

•  Potential costs for businesses of automatic pension enrolment

•  Constructive dismissal and breach of the implied term of trust and confidence

•  The right to return to work after maternity leave

 

Employee misconduct: carrying out a reasonable investigation

Businesses should take note of a Court of Appeal decision that focused on the level of investigation that an employer may be expected to undertake where there is an alleged theft or act of dishonesty by an employee. In this case, the court restored an employment tribunal's decision that an employee had not been unfairly dismissed for theft. Although the employee in question had, following dismissal, been found not guilty of theft in a criminal court, the tribunal was entitled to find that the employer had acted reasonably in dismissing him following a reasonable investigation.

The decision also underlines the importance for businesses of making sure that a fair process is followed in similar situations. In this instance, the employee had been given every opportunity for his case to be heard at both a disciplinary hearing and an appeal hearing, and therefore the process was deemed fair.

Dealing with employee grievances: the right to be accompanied

The Employment Appeal Tribunal (EAT) has held that an employer breached section 10 of the Employment Relations Act 1999 when it refused an employee's request to be accompanied at a grievance hearing by a certified union officer. The employee's right to choose a companion was an absolute right, subject only to the requirement that the companion be an appropriate union representative or one of the employer's other workers.

Dismissing an employee for gross misconduct after an inadequate investigation was victimisation

A recent EAT decision highlights that even an admission of gross misconduct from an employee is no guarantee that dismissal will be fair. The EAT agreed with an employment tribunal that an employee was unfairly dismissed and victimised when he was summarily dismissed, ostensibly for knowingly using non-kosher jam to make cakes at a kosher bakery.

However, the EAT held that the principal reason for the dismissal was that the employee was regarded as a "problem employee" as he had previously asked for adjustments to his duties due to sciatica and had brought a tribunal claim for disability discrimination. Had it not been for this, the employer would have carried out a more thorough investigation and may as a result have imposed a more lenient penalty.

Redundancy: refusing suitable alternative employment

A recent Court of Appeal decision highlights that the question of whether an employee's refusal of suitable alternative employment is reasonable will depend on the circumstances of the particular employee. The decision also underlines the importance, when considering a particular employee's reasons for refusal, of identifying what those reasons were and what relative weight they had in the employee's decision-making process.

The court held that an employment tribunal had made an error in finding the refusal of suitable alternative employment by a potentially redundant employee to be unreasonable. In this case, the employee had spent 30 years working as a community nurse and it was therefore considered reasonable for her to refuse suitable alternative work in a hospital. The tribunal had also failed to address the relevance of the employee's intention to emigrate and whether her preference for taking redundancy benefits had clouded her assessment of the job offer.

If a business is making redundancies, it has a duty to look for alternative employment for any potentially redundant employees. A dismissal is likely to be unfair if, at the time of the dismissal, the business fails to consider whether any suitable alternative employment exists.

Flexible working, indirect sex discrimination and internal appeals

Employers should take note of what appears to be the first case to consider the effect of a successful internal appeal on a prima facie case of indirect sex discrimination. The EAT held that an employee had not suffered indirect sex discrimination when her flexible working request, which was initially refused, was subsequently accepted on appeal before her return to work from maternity leave.

However, businesses should be aware that a similar case with slightly different facts may be decided differently, depending on the timing of a successful internal appeal decision in relation to the employee's return to work date.

Potential costs for businesses of automatic pension enrolment

A report by the Centre for Economics and Business Research predicts that the set-up costs of automatic pension enrolment will average £8,900 for small businesses (four or fewer employees) and £12,600 for small-to-medium-sized businesses. The report also suggests that preparation for auto-enrolment could take each business "up to 103 man days" while ongoing administration tasks could require more than three days a month for some companies.

Constructive dismissal and breach of the implied term of trust and confidence

The Employment Appeal Tribunal (EAT) has held that an employer's failure to provide an impartial grievance appeal process (by allowing an employee to appeal to a different manager than the one who had heard the original grievance) could amount to a breach of the implied term of trust and confidence.

Whether such an incident amounts to a breach will depend on the facts, including the size of the business and its ability to provide an independent senior manager. A breach of the implied term of trust and confidence may entitle an employee to resign and claim constructive dismissal without having to rely on breach of an express contractual term.

The right to return to work after maternity leave

It is well established that an employee returning from maternity leave (‘ML’) has a right to return to work.  The basic principles are:

• Establish whether an employee has taken ordinary maternity leave (‘OML’) or additional maternity leave (‘AML’) as well;

• An employee who has only taken OML has a right to return to the same job in which she was employed before her absence, on the same terms of employment as before, or that are not less favourable than previous terms of employment had she not been absent;

• If it is not reasonably practicable (for a reason other than redundancy) for the employer to permit an employee on AML to return to the same job (as it would for OML), the employer must permit her to return to another suitable alternative job on terms and conditions not less favourable than those which would have applied had she not been absent;

• If it is not practicable for an employee on ML to return to work due to redundancy she has a pre-emptive right to be offered any suitable available vacancy on terms and conditions not substantially less favourable than those applying to the old job, i.e. she is offered the job first, ahead of other employees who may be at risk of redundancy.

In addition to the above other issues may arise, including:

• The returning mother may effectively extend her ML by taking annual leave at the end.  The employer must bear in mind that an employee on ML continues to accrue her statutory annual leave entitlement.  The interplay of ML and annual leave, including the ‘carry over’ of annual leave is a complex area that cannot be covered within the scope of this article;

• The employee may make a request for flexible working on her return.  For example, to adjust her start/finish times, or to reduce from a full time to a part time role.  An employer must give proper consideration to such a request where the employee has a child under the age of 17 (18 if the child is disabled) and follow a statutory procedure.  There are limited grounds to refuse such a request;

• Duties arising under health and safety provisions, including risk assessments and provision of suitable facilities for breast feeding mothers to rest and that they have adequate rest and meal breaks.

This area of law does have its legal and practical issues.  Following procedures is not necessarily in itself protection for an employer, e.g. refusal of a flexible working request may give rise to a claim for unlawful indirect sex discrimination depending on the circumstances of the case.  Further, the way in which an employer deals with matters may give rise to a fundamental breach of contract on the employer’s part in response to which an employee may choose to resign and bring a claim for constructive unfair dismissal.  Therefore, an employer who is faced with an issue with an employee on ML would be wise to take legal advice before acting.  One wrong step may inadvertently lead to a costly automatically unfair dismissal or a direct / indirect discrimination claim (for which there is no cap on compensation).