Employment Law Update 2018: London

A report on our conference covering changes to employment rights in 2018.

10th October 2018

Conference report

Roger Jeary

by Roger Jeary

This latest employment law update conference was held, appropriately, in the offices of Thompsons Solicitors in Congress House and chaired by Nerys Owen from the Labour Research Department. Nerys welcomed a capacity attendance and thanked Thompsons for their hospitality. She opened by highlighting the work of the Institute and their work on the Manifesto for Labour Law, which is now gathering traction through the Labour Party. She enthusiastically referred to exciting developments within the labour movement tackling the excesses of the modern workplace and contrasting it with the lack of progress from the current government. Nerys then introduced the first speaker, Keith Ewing.

EU Exit and employment rights: update

Professor Keith Ewing, President of the Institute, provided a topical update on the potential impact of EU exit on employment rights. He started by making a number of assumptions: firstly that there will be a deal; secondly that the deal will be approved by Parliament; and finally that there will be some sort of trade agreement. On this premise, Professor Ewing focused on specific employment rights that are EU-sourced. These include paid holidays; health and safety; information and consultation rights; the whole equality agenda of maternity, paternity rights etc; and business failure laws such as redundancy, TUPE etc.

He believes that whilst there would not be a bonfire of rights, some of these rights would be vulnerable. Employment rights were referenced in the “Chequers White Paper”. Government promised that there would not be regression once we left the EU and that the PM believed in strong employment rights. Existing laws would be transferred over. However the promise still raises concerns.

This is a political promise not legally binding and does not bind future Parliaments – they are only as good as the person making the promise. He told Conference we cannot have complete non-regression – we have already lost the right to freedom of movement; lost rights and remedies under the EU Charter of Fundamental Rights; and the government cannot make commitment to the future of works councils as these rely on the attitude of other EU states. This brings into question the participation of British workers in works councils. The future of the Posted Workers Directive is also in question. Professor Ewing also referred to the work of the European Court of Justice (ECJ), which has benefitted British workers over the years. The absence of recourse to this body may have a detrimental impact on the rights of workers. The history of domestic courts in employment law has been very restrictive and British workers have sought progress through the ECJ. Once this opportunity ceases, laws which develop through ECJ decisions will become fossilised in UK Courts with no obligation to follow future decisions of the ECJ.

Professor Ewing then referred to zero-hours contracts and the likelihood of less progress in the UK as he was unsure how much of the new directive would apply to the UK post-Brexit. Finally, he referred to his belief that future social developments in the EU will not apply to the UK. He tempered this, however, by the fact that the current EU is moving towards a very neo-liberal approach and therefore the likelihood of new social progress and legislation is less likely.

Referencing a free trade agreement possibility, and in particular an agreement like the Canada-style agreement, he feels there is cause for anxiety. Labour rights will be those embodied in the free trade agreement and the principles outlined. The Canada agreement states Labour laws should ‘promote’ health and safety, minimum employment standards and non-discrimination of migrant workers – that is not a guarantee. History shows that both parties are already in breach of ILO principles and have no intention of changing their existing breaches. Further, these trade agreements provide no means of enforcement of labour rights. He concluded that his assumptions are also on the basis that the current government concludes the agreement and that the alternative is a general election, which could result in a different government concluding a very different agreement.

Click here to download Keith’s paper

Cases from the workplace

The second speaker, Paul Scholey, Senior Partner from Morrish Solicitors, highlighted a number of recent cases from the workplace covering dismissal, gross misconduct, trade union detriment and discrimination by disability, religion and belief.

The first case (Talon Engineering v Smith UKEAT/0236/17/BA) highlighted the need for fairness in the employer’s approach. The case involved a derogatory email about a third party but which the tribunal determined did not bring the company into disrepute and that therefore the dismissal was unfair. The decision reinforced previous ones that the interpretation of “the band of reasonable tests’ should not allow decisions to be overturned on the basis of the claim that the tribunal had substituted its own mindset; the case also upheld the right to be accompanied as an important test of fairness.

Paul referred then to the difference between good faith and lack of bad faith. In Saad v Southampton University Hospitals NHS Trust the EAT determined that absence of good faith does not automatically convert into bad faith.

In Guler v Turkey (2018) IRLR 880, ECHR, the Court found that his treatment amounted to a breach of his human rights through his participation in a May Day parade in 2008. Paul referred to the difference in UK law that would not have allowed this as a trade union activity and the judgment raises some interesting questions for future UK cases.

Holiday pay, he believes, has now been settled through Flowers v East of England Ambulance Trust UKEAT/0235/17 and Dudley MBC v Willetts [2017] IRLR 870, [2018] ICR 31. In essence now, that which is part of your regular pay, contractual or voluntary, must be included in holiday pay. The Flowers case, however, is subject to an appeal.

The five tests for religion and belief outlined in the Grainger Case were considered in the case of Gray v Mulberry Co (Design) Ltd UKEAT/0040/18. The applicant sued on the basis that her beliefs were denied because her ownership of her designs were a belief. The EAT disagreed and found that the copywrite of her designs did not constitute a ‘belief”.

In the case of Quintiles Commercial UK Ltd v Barongo UKEAT/0255/17, the EAT found there is no clear rule that said a first offence cannot result in dismissal if the action falls within the range of reasonable responses.

In Morris v Metrolink the issue of dismissal on trade union grounds was addressed – the union rep came into possession of a manager’s work diary and he took it to Human Resources. The Court of Appeal reinstated the tribunal decision of unfair dismissal on the basis that the union rep had not made a copy, had only taken it to HR, did not circulate it and did not campaign outside of his representations to the company, and that it was a works diary not a personal diary. These were reasonable actions of a trade union rep.

On disability discrimination, in the case of City of York Council v Grosset [2018] EWCA Civ 1105, a teacher showed the Halloween horror movie to school children. The teacher was disabled but tribunal said this had no bearing on his offence. EAT has overturned this and found that his judgment arose out of his disability and what arose was an impairment of his judgment. A causative link was shown in a medical report and the fact that the employer did not know about this, there was no way they could, did not matter.

Finally Paul spoke about the case of X v Y Ltd UKEAT/0261/17. Legal professional privilege – where there was a solicitor who was disabled that the employer wanted to sack. When redundancy arose he was selected, the applicant found a copy of an earlier memo which outlined the intention of the employer. It was argued that this was privileged information and couldn’t be used in a court of law. Applicant claimed successfully that the rule of privilege has exceptions i.e. where it is used to hide fraud – and the EAT found that the attempt to avoid obligations in employment law amounted to an iniquity.

Click here to download Paul’s presentation

GMB wins in Precarious Work disputes

After coffee the GMB General Secretary, Tim Roache, talked about disputes involving precarious work and trade union successes. He started by examining how GMB and other trade unions got to where they are today over the past four decades. He referred to the nature of private business and public sector structures and the rights that trade unions had in the 1970s. Nowadays, all that has changed with the fragmentation of businesses and the public sector, creating problems for trade union organisation, which over the years had not been addressed. Tim took on his current role to help build a union for the 21st century taking into account modern workplace structures. He referenced the scandal of housing initiated by the Thatcher years and the sell-off of council houses. He referred to Brexit and the outcome of the referendum, which he understood as a result of how workers had been treated. But in turning to precarious work he described the ‘gig’ economy as a term which hides the unfairness of so called flexible employment. The Uber case, which GMB led, on illustrated how workers treated as self-employed could not claim sick pay or holiday pay and suffered as a result. Organising in this sector is very difficult because of the nature of the work. Trade unions have to adapt their resources using social media or working in the community. GMB tried to organise workers in ASOS centre but were undermined by a sister union who went in and signed an agreement with four members despite the GMB campaign.

With regard to Amazon, the conditions of work are appalling. The employer denies access and won’t meet the unions. The GMB is campaigning against the company CEO who believes that the best way to run your business is to ensure your employees wake up in fear! Tim emphasised that trade unions cannot sit back and allow such practices and the campaigns must continue.

During a question and answer session, Tim dealt with questions on Brexit and the Labour Party. Tim argued that what he wanted was a general election or secondly a vote for people on any deal. A question on precarious work raised the issue of what other unions can do to prevent the spread of precarious work. Tim said it is important to demonstrate relevance of collective bargaining and there is a responsibility for trade unions to engage with those at work, and using like to recruit like, particularly young people. He was asked whether there is a greater role for trade unions encouraging recruitment, recognising that work in this sector is very often temporary and unions needed to work together to address this. Tim accepted that unions have to offer something different to address modern workplace features and encourage transferability of union membership.

The Trade Union Act in practice

Professor Alan Bogg, University of Bristol, explained the implications of the Trade Union Act 2016 in practice, including the right to strike. He reminded the conference of the main provisions relating to strike action and the thresholds imposed (despite that no issues existed which warranted the introduction of this Act). He was particularly concerned with the introduction of ‘important public services’ and the additional threshold provisions in these sectors, and also the requirements that now need to be included in the voting paper, which provides increased opportunities for employers to seek injunctions.

Alan went on to discuss some recent cases under the Act. In Argos v Unite [2017] EWHC 1959 (QB), which questioned the accuracy of the description of the summary of the dispute on the ballot paper. The court took a common sense view of ‘summary’ and it was a ‘win’ for the union. In Thomas Cook Airlines v BALPA it was about the union putting the specific dates for strike action on the ballot paper. Again a union win, which does not require specific dates to be included but just the period. So far, case law has been positive.

On the review of e-balloting, which reported in 2017 with a number of recommendations, Alan believes these fell well short and raised questions as to whether e-balloting has been killed off for now.

In turning to the Trade Union (Wales) Act 2017, which disapplies the balloting threshold in important public services and the provisions on trade union facility time and check-off, Alan posed the question as to whether the government will pursue action in the courts against the legislation. He felt that there are political opportunities to embarrass the government on this.

The ILO committee of experts has requested the government review the 50% threshold. The impact of the threshold on large-scale disputes is apparent and he referenced work of Gregor Gall.

Alan felt the future prospects and lessons learned from this legislation opened up possibilities of exploring the political significance of federalism in labour law, but felt prospects of successful challenge to European Court of Human Rights (EUctHR) were minimal and the answer to the Act lies in political challenge using the IER Manifesto.

Click here to download Alan’s presentation

Developing caselaw on unlawful inducements

The morning sessions concluded with an interesting talk from Neill Todd of Thompsons Solicitors on developing case law on unlawful inducements. He started by reminding conference of the Wilson and Palmer decision, which brought about the legal provision now contained in the Trade Union & Labour Relations (Consolidation) Act (TULR(C)A) Sections 145A and B. The EUctHR determined that the UK had failed in its positive obligation to secure the enjoyment of applicants’ rights under Article 11 of the EU Convention of Human Rights in the cases of Wilson and Palmer.

The UK addressed this through the addition to TULR(C)A. Neill explained a number of definitions contained within the provisions and on inducements in particular. The word ‘inducement’ does not appear in the statutory term but it could be argued to fall within the definition within Section 145B. He emphasised that the employer has to have as its sole and main purpose the intention to move away from collective bargaining processes. This aspect has been tested in a number of ET cases including Budgen & Ors v London Borough of Bromley and Whittaker v Buckinghamshire County Council. Both found in favour of the union, whereas in Wyer & Ors v Pembrokeshire County Council the tribunal found that it was not the purpose of the employer to avoid collective bargaining.

The outcome of the Dunkerley v Kostas UK Ltd case revolved around the offer made in a pay claim, which the union put to its members with a recommendation to reject – which they did. The Company then put the offer direct to employees with threat to withdraw their Christmas bonus if rejected. A second direct offer was made a month later. A tribunal claim was lodged under section145B and was successful. The employer appealed and the EAT rejected the appeal saying that the result need not be permanent; also the EAT said that this does not mean that there is no right of veto, it will depend on the facts. In this case the EAT determined that it was exceptionally improbable that the company had not intended to circumvent collective bargaining. The matter is now the subject of further appeal to the Court of Appeal on the basis that the prohibited result should be based on the effect on future collective bargaining after the time of acceptance and that the EAT had erred in construing the employer’s sole or main purpose. Neill feels that the key battleground in the CA will be whether the employer’s actions were the sole or main purpose to circumvent collective bargaining.

In conclusion, Neill referred again to Article 11 and the fact that collective bargaining is covered by the Article. He does not accept that if the employer goes direct to employees one year and then returns to collective bargaining the following year it can avoid its obligations under S145B, and he is hopeful that the CA will uphold the previous decisions of the Tribunal and EAT.

Click here to download Neill’s presentation

USS dispute and pensions as an employment right

Following lunch, Dr Jo Grady of University of Sheffield talked about pensions as an employment right with specific reference to the USS dispute. She began by highlighting the scale and impact of the USS dispute 2017/18, which resulted in unprecedented industrial action across the University Sector in the UK. Jo explained that the action was triggered as a result of the employer threatening the future of the direct benefit (DB) Pension Scheme. The action resulted in a spike in UCU membership and increased confidence through sustained mobilisation and collective action with new activists emerging from the grass roots. She went on to highlight the use of social media during the dispute and how it help democratise information, educate strikers about pensions and tactics and disturbed dominant pensions discourse.

All of this changed the dynamic of university life and brought about a solidarity that hadn’t existed before. What fuelled this mobilisation was the attack on pensions, the mini-break pensions holidays, pay of vice-chancellors, and attacks on staff conditions.

Dr Grady then explained that following a ballot in the Spring of this year a Joint Expert Panel was convened and found that The Pensions Regulator had mis-advised the Scheme and it resulted in the recommendation for a DB scheme to continue for University employees. As a result, the dispute was seen as perhaps unnecessary had there been the accurate knowledge about the Pension Scheme in the beginning which clearly demonstrated, following the findings of the Expert Panel, that the employers had never needed to propose the action it did.

Click here to download Jo’s presentation

Automation and employment rights

Dr Ewan McGaughey, Kings College, addressed the impact of automation on employment rights. He sought to destroy the claims that mass unemployment will result from automation. The narrative of mass unemployment is frequently outlined and is nothing new. He referenced Keynes in 1930 and Frey and Osborne in 2013 and Grey in 2017, all of whom argued that robots/technology will replace jobs. Dr McGaughey questioned the evidence to support these claims and undertook his own study of the subject using historical evidence drawn from the Canterbury Tales. He then looked at full employment achieved in the post-war years and then unemployment post-Thatcher and the arguments, again without evidence, that to achieve full employment, actions to undermine unions and remove minimum wages etc. are needed.

Social policy, he argued, can reduce unemployment as evidenced post-Second World War. Private global investment is volatile due to global companies hoarding funds perpetuating unemployment. He argues that trade union membership is crucial to having a voice at work and this in turn is essential to address inequality. He asserted three alternatives to ensure full employment in the face of automation. Firstly, employee share schemes; secondly, creation of inclusive ownership funds – that is non-tradeable shares in the company paid for through a tax on share dividends; thirdly the Manifesto for Labour Law, whereby every employee becomes a member of the company with a voice and workers get half the representation on pension scheme boards.

Click here to download Ewan’s presentation

The McDonalds dispute

Conference concluded with Ian Hodson, President of the The Bakers Union (BFAWU), talking about the McDonalds dispute. Ian told the conference that the dispute started over four years ago when they looked at how they would tackle precarious jobs in their industry following the Hovis strike.

He reminded us that it was in 1974 that McDonalds introduced the first ‘zero-hours contract’ as a means to reduce the cost of labour and maximise profit. It is the largest employer of young people starting their first jobs, and the second largest employer around the world. Now, of course, we see the model extended across the economy. The BFAWU put their fast food campaign together with the object of explaining the importance of trade unions to the workers, not just to recruit the workers, but to encourage them to join the campaign to call for at least £10 per hour as a minimum wage and the removal of zero-hours contracts. He argued that flexibility can be achieved without the use of such contracts.

The campaign was a broad coalition of unions based on protest initially, but last year when the strike was organised the reality dawned on people that you can organise the unorganisable. Ian passionately explained that these people matter, many of whom are well-educated and skilled, and they went on strike in September and in the last week joined forces with other groups such as TGI Friday workers and other trade unions including Unite and GMB to seek to end the precarious work in this sector. The absence of contracts of employment did not prevent them from striking and Ian argued that it is right that when the law is wrong we must challenge it. The campaign will, going forward, seek to address the sexual harassment that is rife in the sector and will also explore how sectoral agreements might work in the food sector.

Click here to download Ian’s presentation