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Farrer & Co | From Unison to whistleblowing – reasons why 2017 is worth remembering

Now that January has finally limped to the finish line, you could be forgiven for feeling that 2017 was a long time ago. However, before your memories fade altogether, I thought it would be a helpful reminder to look at some of the key employment matters from last year which are likely to continue to have an impact in 2018, as well as consider some of the new developments which this year may bring. For those of you who want more detail on any of the cases mentioned, I have included links to our WorkLife blogs from the time.


1. Unison and Tribunal fees

The most publicised employment case of 2017 was undoubtedly R (on the application of Unison) v Lord Chancellor. This was the case in which the Supreme Court unanimously ruled that Employment Tribunal fees were unlawful, as they prevented access to justice and were indirectly discriminatory against women. The impact was immediate – tribunal fees were rescinded and the Government is facing a £30 million bill for refunding any fees paid plus interest.

The question which remains is quite what impact this case will have on numbers of tribunal claims going forwards (which were significantly depressed following the introduction of fees in 2013). The latest Tribunal quarterly statistics published in December indicate that the number of claims lodged by a single claimant have increased by 64% when compared with the same period one year earlier. If this trend continues, the reverberations of this case will clearly be felt throughout 2018,

2. Employment Status

Uber, Deliveroo, Pimlico Plumbers, CitySprint, the list goes on... Employment status was a hot topic in 2017 and will undoubtedly continue to be this year, particularly as appeals are pending in many of these cases – Pimlico Plumbers for example heads to the Supreme Court on 20 and 21 February – and in light of the Government's recent response to the Matthew Taylor Good Work Review.

Employment status cases throw up far too many issues to cover now, but the one case I want mention is Sash Windows Workshop v King, since it has the potential to have a significant and unfortunately negative impact on employers. In short, the CJEU held that if workers are "prevented" from taking their annual leave – for example, if an employer has wrongly classed an individual as an independent contractor rather than a worker - they will be entitled to back-dated holiday pay for the entire period they were prevented from taking holiday. In this case, 12 years; a substantial sum.

This case now has to go back to Court of Appeal, so is not yet fully binding on UK employers. But watch this space – we are likely to receive a decision sometime this year. If the principles laid down by the European court do become binding, it will significantly raise the stakes for worker status disputes, since it could lead to much higher levels of compensation in cases where an independent contractor is found to be a worker.

3. Whistleblowing

2017 taught us several important lessons in the context of whistleblowing:

  • First, that the introduction of the "public interest" test in 2013 may not have quite the significant impact which some employers had hoped. The Court of Appeal confirmed that a disclosure which is in the private interest of the worker making it, can also be in the public interest if it serves the (private) interests of other workers as well (in this case the worker alleged financial misreporting, which adversely affected the levels of commission received by him and about 100 employees). In other words, it seemingly remains fairly easy for a worker to demonstrate they have a reasonable belief that their disclosure is in the public interest, provided they can show the issue in question affects other individuals too (and "the public" for these purposes do not necessarily need to be outside an employer's workforce). (Chesterton v Nurmohamed).
  • Second, in the context of unfair dismissal claims, it is the mind-set of the decision maker that is important, (rather than a wider group of employees). This is the case even when the decision maker has (unknowingly to them) been deliberately provided with misleading information because of earlier protected disclosures (Royal Mail v Jhuti).
  • And finally, it is irrelevant if an employer genuinely believes that an employee's disclosure does not amount to a protected disclosure (Dr Beatt v Croydon Health HNS Trust).

4. Data and employee privacy

Apparently the global data economy is worth $3 trillion (World Economic Forum, 2017). And where there's a value like that, there is inevitably legislation, case law and a multitude of risks which organisations – including HR - have to grapple with. The major spectre on this particular horizon is, of course, the GDPR, which comes into force on 28 May 2018. For those interested in learning more, see our blog posts on what you need to know about the GDPR and how to get ready for it.

Two cases from 2017 concerning data are also worth mentioning, since their impact is likely to be felt in the year ahead:

  • Various Claimants v Morrisons Supermarket – in a potentially concerning case for employers, the High Court held for the first time that employers can be vicariously liable for data protection breaches by employees. In this case, a disgruntled employee uploaded the payroll details of employees online using his personal computer, outside of work premises and outside of working hours. Although Morrisons was not found legally at fault for the data leak, it was still found to be vicariously liable for the employee's actions. This potentially makes employers very vulnerable to rogue employees and is all the more reason to take your preparations for the GDPR seriously.
  • Barbulescu v Romania – Contrary to an earlier ECHR case, the Grand Chamber of the Court of Human Rights reminded employers that they must inform employees if they are monitoring their communications. This signals a return to the orthodoxy, so hopefully is something with which you are familiar, but a reminder not to let things slip in this area.

5. Other things to look out for in 2018:

  • Following the Harvey Weinstein saga last autumn, what organisations can and should be doing to prevent harassment has moved high up the work agenda. 2018 is likely to see a continued focus on what employers are doing to create an open and respectful culture in their organisation – watch out for next week's WorkLife post in which Maria Strauss considers the potential steps employers can take to prevent sexual harassment in the workplace.
  • Mandatory gender pay gap reporting – the first reports for large private and voluntary sector employers are due by 4 April 2018. We are already seeing some organisations publish their reports with quite significant gaps being revealed in certain industries, something the press has been quick to pick up on. With the vast majority of organisations still yet to publish though, the eventual figures could make for interesting reading.
  • We will learn whether the ECJ agrees with the Advocate General that pregnant workers should be protected even before their employer has been informed of their pregnancy (Porras Guisado v Bankia SA).
  • We will hopefully get (a bit more) clarity from the EAT on shared parental leave and whether or not it is discriminatory to pay only statutory shared parental pay to partners, when mothers on maternity leave are paid full pay (Hextall v Chief Constable of Leicestershire Police; Capita Customer Management Limited v Ali).
  • In April, along with increases to various payments and tribunal awards, there will be a change to the way payments in lieu of notice are taxed. From 6 April, all PILONS – whether they are contractual or otherwise – will be fully taxable (currently this is only definitely the case with contractual PILONS). The take away point is that the tax and NICs consequences on notice paid to a departing employee will be the same for everyone, regardless of how the employment contract is drafted or how the termination payments are structured. We will be providing guidance on this issue later this month.
  • And of course, when looking at the year ahead, we cannot get away without mentioning Brexit. But that is a story for another day, and who knows where it will go....

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