07/22/2024 | News release | Distributed by Public on 07/22/2024 03:12
Welcome to the ninth edition of The Employment Edit - a summary of the most important recent cases and news affecting employers in the UK. We hope you find this newsletter helpful and informative. In this edition, we look at:
Following the general election, with the Labour Party now in power, significant changes to employment law are expected. The Government's first step has been to indicate in the King's Speech that it will introduce draft legislation - an Employment Rights Bill and a Draft Equality (Race and Disability) Bill which will implement parts of the employment law related proposals contained in the Labour Party's election manifesto (the manifesto).
The King's Speech, which sets out the Government's legislative agenda for the coming months, confirmed the Government's intention to implement in full the proposals contained in its paper 'Labour's Plan to Make Work Pay, Delivering a New Deal for Working People' published in May 2024, which built on earlier proposals published in 'A New Deal for Working People' published in September 2023. The key proposals that are likely to be of most interest to employers are as follows:
Employment Rights Bill
Draft Equality (Race and Disability) Bill
The manifesto also contained the following key proposals:
Takeaway: the new Government has committed to a substantial programme of employment law reform, starting with the draft legislation indicated in the King's Speech. It may take some considerable time to implement all the manifesto proposals in full. This could be a busy period of change, and employers will need to keep on top of the changes and ensure that policies and working practices are kept up to date.
In Valimulla v Al-Khair Foundation, the Employment Appeal Tribunal (EAT) found that an employee who had been made redundant was unfairly dismissed because the employer's consultation with him was not 'meaningful' - in the sense that it did not take place at a time when it could potentially make a difference to the outcome of the redundancy.
Mr. Valimulla worked as a Majid Liaison Officer based in Bolton in the Northwest of England raising funds in the community for his employer, which was a charity. Three other employees performed the same or similar roles for the employer in different geographical locations. During the COVID-19 pandemic, it became more usual for donations to be made online, and Mr. Valimulla's role was identified as potentially redundant. He was informed that he was in a unique role and that he was therefore in a redundancy pool of one. Three redundancy consultation meetings then took place and at the end of the consultation process Mr. Valimulla was dismissed as redundant.
The EAT found that, while there was a genuine redundancy situation, it was not limited by geographical location, i.e., the need to reduce the workforce was not limited to the Bolton branch but applied across the business. In order for a redundancy dismissal to be fair, an employer must be able to show that its redundancy selection process was reasonable. While this may be achievable in different ways, the employer must be able to show that it 'genuinely applied its mind' to the question of the pool from which those employees who are to be made redundant should be selected. There was no evidence that the employer had done so in this case.
In addition, there had been no meaningful consultation with Mr. Valimulla. The selection pool was a key issue - i.e., why was Mr. Valimulla in Bolton selected for redundancy while those performing the same role in different locations were not. The consultation meetings took place after the decision had been taken by the employer to place Mr. Valimulla in the selection pool of one. It was too late for any proposals that he might make on this issue during the consultation meetings to be meaningful. This meant that the dismissal was unfair.
Takeaway: the EAT said that 'meaningful consultation' means setting out a provisional proposal, along with its rationale, and providing an opportunity for feedback, comments and observations. A decision maker should consider the responses to the consultation with an open mind, considering whether they alter the initial proposal or not. A decision should only be made after this has been done.
A number of recent cases have focused on the requirement for employers to consult with employees who are potentially redundant at a formative stage in the process. While this requirement is not a new principle, it appears to be coming under greater scrutiny by tribunals and raised more regularly by employees as a challenge to the fairness of a redundancy process. Employers need to consider carefully the point at which redundancy proposals have become sufficiently clear such that consultation is practically possible, while not leaving it so late that consultation is not meaningful.
In Clifford v IBM United Kingdom Ltd, the EAT confirmed that a waiver of future claims contained in a settlement agreement dated 2013 was effective, and that therefore claims for disability discrimination brought by Mr. Clifford in 2022 should be struck out.
Mr. Clifford was continuously absent from work from 2008 as a result of ill health. In 2012, having raised various grievances against his employer, it was agreed that he would move to his employer's long-term disability plan. He signed a settlement agreement in which he waived the right to bring various claims against his employer including disability claims, whether or not they were known to the parties at the date of the agreement. This waiver covered future claims linked to the grievance and his move to the disability plan.
In February 2022, Mr. Clifford sought to bring a number of disability discrimination claims against his employer that related to payments under the long-term disability plan. The EAT found that the waiver in the 2013 settlement agreement was effective. Future claims can be compromised by a settlement agreement if all the statutory conditions for a valid settlement agreement are met. The fact that Mr. Clifford remained in employment on the long-term disability plan did not affect the validity of the waiver of future claims.
A waiver of claims has to be specific and identify the particular complaints that it is intended to cover. An employer cannot use a blanket waiver in relation to which an employee signs away their right to bring any claim at all. However, provided that the specific claim is identified, a waiver can cover future claims. In this case, the waiver covered disability claims related to Mr. Clifford's grievance and the long-term disability plan. It was therefore valid.
Takeaway: this is a helpful case for employers confirming that while a blanket waiver of future claims will not be valid, a well-drafted waiver can be valid to protect the employer against future claims arising in respect of an identified set of circumstances.