Case round-up

Amicus v GBS Tooling Limited
Collective redundancy steps

The EAT has held that when deciding on the amount of the protective award in respect of an employer’s failure to carry out collective redundancy consultation, tribunals are entitled to take into account the seriousness of the breach and the mitigating circumstances, including any steps taken by the employer before the redundancy proposals were crystallised.

GBS ran a business manufacturing and supplying aluminium pressings to the automotive industry and had two major customers which accounted for approximately 70% of its business. In September and December 2003 notices were severally given by each of those two customers that they were intending to transfer their business overseas.

GBS admitted there had been no consultation after the date on which the proposal to make redundancies was made, and before the termination letters were sent to employees. Therefore, the only question for the tribunal to decide was the amount of the protective award. The tribunal concluded that a protec-ted period of 70 days (not the full 90 days) was just and equitable in all the circumstances. The EAT dismissed the appeal by Amicus.

In reaching its decision, the employment tribunal was entitled to take into account, as a mitigating factor, that GBS had taken steps to keep Amicus and the employees informed in general terms of its situation and the possibility that some redundancies would be necessary. There was some evidence that the union had been given some opportunity to put forward suggestions for avoiding redundancies.

In the EAT’s view, the tribunal had merely exercised its discretion in deciding what is just and equitable in light of the seriousness of the breach. Tribunals are able to make reductions in the amount of the protective award where mitigating circumstances exist.

What you should do

  • Be aware that employers which carry out no consultation at all run the risk of a maximum protective award being awarded
  • When carrying out consultation make sure it is meaningful. ‘Going through the motions’ runs the risk of a maximum protective award being awarded
  • Even if there are failings in the way the consultation process has been carried out, don’t necessarily abandon the exercise. Provided there are mitigating circumstances (eg, where failure to provide information at the right time is not deliberate and efforts have been made to provide information to employees and their representatives) a maximum protective award may still be avoided
  • Remember that a protective award is a sanction for the employer’s breach and can be made even where the employees have suffered no losses.

Fisher v Hoopoe Finance Limited
Alternative posts in redundancy situation

The EAT has held that, in a redundancy situation, an employer should, normally, inform a redundant employee of the financial prospects of any alternative work available so that they can make an informed choice as to whether to take up the alternative work.

In this case, Fisher was employed by Hoopoe Finance as a new business manager earning approximately 40,000 per year. When his position became redundant he had several meetings with his employer about the redundancy situation, during which he was informed of other vacancies within the company. Fisher did not express any interest in any of the alternative roles available. Fisher was made redundant. The following month, the company advertised the position of sales manager at a similar salary to that of Fisher’s redundant position. Fisher claimed that the redundancy had been unfair as, had he been told of the financial prospects of the sales manager role, he would have seriously considered, if not accepted it.

The tribunal decided in favour of the company, but the EAT disagreed. The EAT said that while an employer should normally inform the employee of the financial prospects of any suitable alternative work, it accepted that this might not be practicable where the financial prospects of a particular position were not available (however, that was not the case here). The EAT also found that a failure by an employee to indicate an interest in a particular position and/or to request further information does not excuse the employer, but this can be taken into account by the tribunal in reducing unfair dismissal compensation.

Where alternative employment is available in a redundancy situation, the employer should normally inform the employee of the financial prospects of the alternatives so the employee can make an informed choice. Failure to provide such information is likely to make any dismissal unfair.

Where the employee expresses no interest in any alternative position, the dismissal is likely to be unfair, but the tribunal may reduce any compensation payable to the employee.

What you should do

  • In a redundancy situation, ensure all relevant details, and especially remuneration details, are provided to employees in relation to potential suitable alternative roles (whether or not the employee expresses any interest in the roles) to allow the employee to make an informed choice about whether to take or reject an alternative job and to avoid a claim for unfair dismissal
  • If actual remuneration details are not available, provide ballpark figures, where possible
  • In this case the EAT stated that the obligation to provide financial information extended to any ‘suitable alternative employment’ available, but a prudent approach would be to apply this rule to any alternative jobs available, whether or not the employer deems them to be ‘suitable’.

Moroak T/A Blake Envelopes v D L Cromie
Out-of-time responses

The EAT has held that a tribunal does have discretion to review its own decision to refuse to accept an out of time response to a tribunal claim, where the interests of justice require it. The test is what is just and equitable to extend or to forgive a failure to get a response in time.

In this case the employer’s response to its ex-employee’s unfair dismissal claim was filed at the tribunal 44 minutes late. The response was due in by midnight on 11 November 2004, but the employer explained that while the response was drafted before the deadline, there was a computer problem which caused the delay in the response being submitted.

The tribunal decided, based on the new tribunal rules that came into force in October 2004, that the employer could not take part in the proceedings as a result of that delay, and following an application by the employer, refused to review its decision on this on the basis that it did not have the power to do so. The EAT disagreed.

The EAT also said that, since there was no prejudice to the employee by the delay in the filling of the response, and the employer had given a full explanation for the delay, the tribunal should have accepted the response.

In deciding whether a response has been filed in time, the tribunal should take into account all relevant factors, including the employer’s explanation for the delay. The tribunal must reach a conclusion which is in the interests of justice, balancing the possible prejudice to each party.

What you should do

While there remains scope for tribunals to accept late responses (contrary to what was anticipated when the new employment tribunal rules came into effect), employers should do all they can to get tribunal responses in on time (by midnight of the date on which the response is due). If the response is received late, then the employer should immediately provide a full and proper explanation to the tribunal the reason for the delay and, if possible, stress that the delay has caused the claimant no prejudice.

Melhuish v Redbridge Citizens Advice Bureau
Unfair dismissal claim

The EAT has given some guidance on the status of volunteers. The EAT in this case holds that a volunteer who receives no pay other than reimbursement of expenses, and who is not obliged to attend work, is not an employee.

In this case, Melhuish spent two days a week working at the Citizens Advice Bureau. He was not obliged to attend work, nor was the CAB obliged to provide work for him. Melhuish was not entitled to any pay for his services, although the CAB did reimburse expenses, including travelling expenses from home to work and back.

Melhuish was expected to attend work one or two days a week but if he notified the CAB that he was not attending, the CAB would try and find a substitute for him and there was no sanction for his non-attendance.

Melhuish tried to bring an unfair dismissal claim against the CAB but the tribunal dismissed that claim on the basis that Melhuish was not an employee. The EAT agreed.

The EAT found that the fact that the CAB did not pay any remuneration to Melhuish and the fact that he was not obliged to attend work and the CAB was not obliged to provide work, was inconsistent with a contract of employment.

In fact the EAT went further than this and said that, in this case, there was no contract here at all, which means that there can be no discrimination claim either.

What you should do

  • Review your arrangements with any volunteers. Just because someone is labelled a ‘volunteer’ does not mean that they will not have employment rights. Their rights will depend on what happens in practice
  • While most volunteers will be precluded from bringing employment claims, if you pay your volunteers salary (other than expenses), however nominal, and you require them to attend work, however infrequently, you may, unwittingly, bestow on them employment rights.

Hot spots

Tribunal application posting was out of time
The EAT has reaffirmed the rule in Consignia plc v Sealy 2002 that when an originating application is posted by first class post, it is deemed to be presented at the employment tribunal two posting days later (excluding Sundays and Bank Holidays) Therefore, where an application was posted on Friday June 28, but did not arrive until Monday July 1, it was a day out of time and should have been presented at an employment tribunal before midnight on Sunday, June 30.

SE Coldbridge v HM Prison Service 2005

Question of actual dismissal reason
The EAT has held that where an employer’s actual reason for dismissal was contested, a tribunal is entitled to assess all the facts in order to identify the ‘real’ or actual reason for dismissal. Where an employer was dismissing an employee on hollow grounds, but, before doing so was presented with a better or proper ground on which to dismiss, the question for the tribunal was whether the employer’s original intention had been put to one side or overtaken by the opportunity for a legitimate dismissal.

BSW v Ian Brown 2005

Ignorance of time limit was reasonable
The Court of Appeal has ruled that an employment tribunal was entitled to find that it had not been reasonably practicable for a claimant to present a claim for unfair dismissal within the three-month time limit. The claimant’s ignorance of the time limit had been reasonable, as she had received misleading advice from a CAB and her employer, and mistakenly believed that she had to exhaust the employer’s appeal procedure before making a claim. The court added that, even if this was a case where the claimant had received incorrect skilled advice from a CAB, that did not rule out the possibility of demonstrating it was not reasonably practicable to make a timely application to a tribunal.

Marks and Spencer plc v Williams-Ryan

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