A Festive Flurry of Employment & HR News
Under the Finance Bill 2019-20 anyone involved in tax avoidance, evasion or phoenixism (when a company is liquidated, and a new company started, to avoid paying outstanding tax) will be liable for the company’s tax liabilities. Company directors will be held jointly and severally liable for outstanding tax where there is a risk that the company may have deliberately entered insolvency. The proposed legislation only allows for an appeal on the HMRC’s decision on procedural matters, and only to their own internally appointed reviewer. This would avoid the current court process entirely. Company directors need to be aware of their potential liabilities and should always seek early advice.
Business Secretary, Greg Clark, has recently informed the Cabinet that he hopes to implement several key recommendations from the Taylor Review of Modern Working Practices.
The Government also has many other plans and they are as follows:
500m Marriott International customers’ records (including payment card details, passport numbers and emails) have been compromised in a recent data breach. The advice here is that you should ensure you have effective data protection measures in place including with regard to cyber security checks and that should be covered in relevant job descriptions.
The ICO has issued >100 penalty notices to organisations that have failed to renew their data protection fees. The maximum fine for non-compliance is £4,350. If organisations still don’t pay they face further legal action. If you’re not sure whether you need to pay the fee, it is worth looking at the ICO self-assessment test online.
In Jayeola v Commissioners for HMRC, an employee (“J”) raised a complaint with his employer. Whilst walking through an area without lights the employee of a contractor (G4S) shouted to J (who is of Nigerian ethnic origin and describes his skin colour as black) “It’s a good thing you’re wearing a white shirt, or I wouldn’t have seen you”. J’s employer: didn’t carry out its own investigation; was unaware of the outcome of G4S’s investigation and reason for allowing the employee to return to work; and refused J’s request that the employee be removed from the premises or at least J’s working floor. The Employment Tribunal found that J’s employer treated him less favourably due to his race (they would have granted a white employee’s request that the employee be barred from the floor/premises). J was awarded >£24k for racial discrimination.
Note: an employer can be liable for the actions of anyone acting on their behalf, not just employees. Businesses must manage the matter properly even where the relevant conduct may not relate to an employee. One must be mindful of each staff member’s status because that can have other ramifications too.
In JLT Specialty v Craven, Mr Craven (“C”) received a £500k bonus advance which was repayable if he resigned on or before 31 December 2016. The notice period was 52 weeks and notice given by C could not expire before 31 December 2016. C resigned in September 2015. JLT accepted that C’s employment would end on 1 January 2017. JLT sent further correspondence stating that C’s last day of employment was 31 December 2016 and the bonus advance must be repaid by 7 January 2017. C failed to do so. The Court of Appeal rejected an argument that JLT’s letter varied the original agreement so that C’s employment ended on 1 January 2017. Rather, both parties’ conduct was “explicable by their existing rights and obligations”. C’s employment ended on 31 December 2016 and the bonus advance was repayable in accordance with the contract.
In Hargreaves v Governing Body of Manchester Grammar School Mr Hargreaves (“H”), a teacher, allegedly grabbed a pupil, pushed him against a wall and put his fingers to his throat. The investigating officer did not disclose in the investigation report the statements of three witnesses who said they hadn’t seen anything. H was dismissed for gross misconduct. He argued that the investigation had been inadequate, especially given the potential impact on his career. The Employment Appeal Tribunal held that the investigation was reasonable and the decision to withhold particular evidence was within the band of reasonable responses. Investigations must be reasonable, considering the seriousness of the allegations and the potential impact on the employee. Investigating officers don’t need to include everything in their reports. However, this doesn’t mean that you can, or should, exclude information. I strongly recommend, given my experience in many cases where it can bite if things are not handled properly, it is best that you consider the circumstances fully and obtain legal advice in advance. That should ensure fair processes are taking place and any dismissal or otherwise is not considered to be premature.
In Hawkes v Ausin Group (UK) Ltd, a Royal Marine volunteer reservist (Mr Hawkes, “H”) agreed to go on a voluntary seven week training exercise. His employer couldn’t accommodate this and dismissed him. They didn’t have a meeting with H before making their decision. The Employment Tribunal held that the dismissal was fair: the employer had raised concerns and H made it clear that he intended to attend the exercise anyway. There was no evidence to suggest that, even if H had been warned in advance that he would be dismissed if he went on the exercise, he would change his mind. A meeting would not have changed the outcome.
Whilst I mention this case because it is interesting, I do recommend that you think twice before dismissing and especially dismissing without holding any meeting. It is risky. Whilst an employee may not have an unfair or wrongful dismissal claim that individual, whether a worker or otherwise, could claim that they have other rights that have been breached, like discrimination.
A quick one: in British Airways v Pinaud, the Court of Appeal held that it was less favourable treatment to pay a part-time worker 50% of full pay when they were on duty for 53.5% of full-time hours. An obvious point but a helpful reminder to check that pay is calculated accurately for part-time workers – especially if their hours vary or have changed.
Claims were brought against Greenwich Council by Unison on behalf of almost 500 term time only staff (mostly women). Part-time workers are protected from less favourable treatment resulting from their part-time status. It was argued that their annual leave had not been calculated properly, so staff lost up to 5 days’ pay per year. Unison has announced a settlement affecting 5k workers worth around £4m. The Council also agreed to revise its holiday pay calculation and backdate it to 2013.
The advice here is to ensure that you pay correctly and in good time unless you have decided to take a calculated risk in which you have received legal advice.
The European Court of Justice (“ECJ”) has considered two German cases about paid annual leave. In Kreuziger v Land Berlin and Max-Planck-Gesellschaft v Shimizu, the ECJ held that a worker who doesn’t apply for statutory leave will not automatically lose the right to a payment in lieu of that leave on termination of employment.
Contact Bhavna Patel if you need help with any of the issues raised. To that end it’s worth reading Personnel Today’s guide to Christmas issues as well as their top 10 employer queries.
The content of this webpage is for information only and is not intended to be construed as legal advice and should not be treated as a substitute for specific advice. PDT Solicitors LLP accepts no responsibility for the content of any third party website to which this webpage refers.