Law and Labour » Supreme Court

Part-year workers’ holiday need not be pro-rated to full-time workers

Law and Labour — Wed, 17 Aug 2022 15:04:04 +0000

Facts

Ms Brazel works as a music teacher for the Harpur Trust. She is employed under a permanent contract and only works during term time. Her hours of work depend on the number of pupils requiring tuition. Ms Brazel is contractually entitled to 5.6 weeks’ holiday, but the contract does not expressly state that her holiday entitlement should be pro-rated.

The Trust pay Ms Brazel on a monthly basis according to the number of hours worked in the previous month, but she is paid her holiday pay at the end of every term. When calculating Ms Brazel’s holiday pay, the Trust followed Acas guidance on casual workers which, at the time, recommended using the rate of 12.07% per hour worked (the “Percentage Method”). Ms Brazel argued that was not the correct calculation under the Working Time Regulations 1998 (“WTR”). She disagreed that her holiday pay should be pro-rated simply because she did not work a full year.

Ms Brazel’s claim for unlawful deduction of wages failed in the Employment Tribunal, but her appeal to the Employment Appeal Tribunal was successful. The Trust appealed to the Court of Appeal which dismissed the appeal. The Trust then appealed to the Supreme Court.

Supreme Court

The question for the Supreme Court to decide was, by which method should Ms Brazel’s payments for annual leave be calculated? This raised an important issue about the statutory leave requirement for “part-year workers” – permanent workers who work for varying hours during only certain weeks of the year.

The Trust put forward various methods for calculating holiday pay, including the Percentage Method and the “Worked Year Method”. The latter method takes account of the fact that Ms Brazel does not work during school holidays. It uses the number of weeks she actually works (34 weeks) to calculate a percentage of the full working year (46.4 weeks). That percentage is then applied to the annual leave entitlement applicable to the full working year.

The Supreme Court found that these alternative methods were problematic. Firstly, they were very different from the statutory method set out in the WTR. Secondly, the calculations were very complicated. The Court noted that the statutory scheme could produce odd results but that does not justify wholesale revision of the scheme.

Importantly, the Supreme Court decided that the “Calendar Week Method” represents the correct implementation of the WTR and is fully compliant with EU law. Ms Brazel is entitled to 5.6 weeks’ paid leave which is taken in 3 equal tranches during the winter, spring and summer school holidays. This means that 1.87 weeks of each school holiday was treated as annual leave for which Ms Brazel was entitled to be paid. Under the Calendar Week Method, Ms Brazel’s holiday pay is calculated by first determining a week’s pay – her average weekly remuneration during the previous 12 weeks – and that figure is then multiplied by 1.87 to get the holiday pay she is due for the 1.87 weeks’ leave she took during each school holiday.

The Supreme Court held that even if the [...]

Pimlico Plumbers loses Supreme Court appeal about plumber’s status as worker

Law and Labour — Sun, 17 Jun 2018 14:00:09 +0000

Background

Gary Smith carried out plumbing work for Pimlico Plumbers (Pimlico) between 2008 and 2011. He had entered into agreements with Pimlico which provided that he was a “sub contracted employee” and later a “self-employed operative” of the business. He was bound to comply with the rules in a company manual, including a requirement to work a minimum of 40 hours a week, and the payment of rental charges to Pimlico for the use of their work van and mobile phone.

Earlier decisions

This case has been rumbling through the courts for a number of years. In August 2011, Mr Smith attempted to bring claims for unfair dismissal, unlawful deduction of wages, disability discrimination and holiday pay in the employment tribunal. In the original tribunal decision, which was handed down in April 2012, it was decided that Mr Smith was not an employee, but he was found to be a worker. Pimlico appealed. In November 2014, the Employment Appeal Tribunal agreed with the tribunal’s decision.

Pimlico made a further appeal to the Court of Appeal. Our report on the court’s dismissal of that appeal can be found here. Pimlico appealed to the Supreme Court.

Supreme Court

In considering the appeal, the Supreme Court focussed on two questions when deciding whether or not Mr Smith was a worker:

Personal performance – was it necessary for Mr Smith to carry out the work for Pimlico himself? Client or customer – was Pimlico Mr Smith’s client or customer rather than his employer? Personal performance

The court noted that Mr Smith’s contracts with Pimlico gave him a limited right to employ a substitute. He could engage another person to provide assistance if he lacked the specialist skill required for a particular job. The Supreme Court found that assistance in performance was not the same as substitution of performance.

Mr Smith was also permitted to arrange for a job to be carried out by another Pimlico operative if he wished to work on a more lucrative gig himself. However, there was no contractual right underpinning this arrangement. It was merely a concession made by Pimlico.

Taking both of these findings into account, the Supreme Court concluded that the right to use a substitute was of insignificance to Pimlico. In addition, the fact that Mr Smith could only use another Pimlico operative to do jobs on his behalf who would also have been subject to the same heavy obligations as him indicated that the right of substitution was not truly unfettered.

The Supreme Court concluded:

“The tribunal was clearly entitled to hold, albeit in different words, that the dominant feature of Mr Smith’s contracts with Pimlico was an obligation of personal performance. ” Supreme Court

Client or customer?

The second issue for the Supreme Court to decide was whether Pimlico was in reality Mr Smith’s client or customer, which would be the situation if Mr Smith was a self-employed contractor providing services to Pimlico. This turned on whether Pimlico was obliged to give Mr Smith work that he was in turn obliged to carry out.

The Supreme Court noted that the contractual arrangement [...]

Supreme Court abolishes Employment Tribunal fees

Law and Labour — Wed, 26 Jul 2017 19:28:29 +0000

The Supreme Court today ruled that the Government’s introduction of employment tribunal fees was unlawful from their inception. This decision means that with immediate effect workers are no longer required to pay fees to bring claims in the employment tribunal. A further consequence of the ruling is that any fees paid by claimants in the past must be refunded to them by the Government. It is estimated that the Government will have to shell out around £30m to cover these fees.

The Supreme Court’s decision came as a surprise because previous challenges to the fees system brought by the trade union Unison had failed in the lower courts. However, the Supreme Court was quite clear in its finding that requiring a claimant to pay fees of any sort in order to seek redress for work-related wrongs prevented access to justice under both English and EU law.

“The Fees Order is unlawful under both domestic and EU law because it has the effect of preventing access to justice. Since it had that effect as soon as it was made, it was therefore unlawful ab initio, and must be quashed.” Supreme Court

This ruling is good news for workers. Employment tribunal claims have been in significant decline since fees were introduced in 2013, and it was widely accepted that fees had effectively deterred workers from bringing tribunal claims. It remains to be seen whether the abolition of fees will lead to a reciprocal sharp increase in new claims.

One notable difference between the present day and the situation prior to the introduction of fees is the operation of the Acas early conciliation system, which became a mandatory part of employment tribunal proceedings around the same time as fees. Would-be claimants are still required to engage in conciliation prior to lodging a claim. While the fees system was in place, employers could negotiate from a position of strength safe in the knowledge that a worker was unlikely to continue with a claim given the daunting level of fees demanded. Now, employers have lost their major bargaining tool and will have to treat any conciliation exercise much more carefully.

Reason for indirect discrimination need not be proven

Law and Labour — Sun, 09 Apr 2017 09:52:59 +0000

In two important judgments on the scope of indirect discrimination relating to race, age and religion – Essop and Naeem – the Supreme Court has decided that there is no need for claimants to prove the reason why a provision, criterion or practice (PCP) puts them at a particular disadvantage. The Court held that it was sufficient to show that there was a causal link between the PCP and the disadvantage suffered.

The Essop case

The Essop case concerned age and race discrimination involving staff at the Home Office who were required to pass a Core Skills Assessment (CSA) in order to gain promotion to higher grades in the civil service. Investigation into CSA pass rates had revealed that candidates who were aged 35 and over or who were non-White had lower pass rates than White or young candidates. However, the reason for this disparity was not known.

The disadvantaged candidates brought an employment tribunal claim arguing that the CSA amounted to indirect discrimination on grounds of age and race. The PCP they relied upon as causing the indirect discrimination was the requirement to pass the CSA as a pre-requisite to promotion. The case passed through the tribunals and lower courts before eventually arriving at the Supreme Court.

The key question for the Supreme Court to decide was whether in order to succeed in their indirect discrimination claim the disadvantaged candidates needed to establish the reason why the group had lower pass rates than their comparators. The Supreme Court decided that it was only necessary to show that the requirement to pass the CSA had caused the candidates to suffer from disadvantage, namely that the group failed the CSA disproportionately. It was not necessary to establish the reason for this particular disadvantage.

The Naeem case

Mr Naeem was a prison chaplain who brought claims of race and religious discrimination in respect of the Prison Service pay scheme for chaplains. The scheme provided that the pay of chaplains increased over time so that pay was linked to length of service. However, the average pay of Muslim chaplains was less than that of Christian chaplains because Muslim chaplains had only been employed in the Prison Service since 2002.

Mr Naeem argued that the pay scheme was indirectly discriminatory against Muslim and Asian chaplains due to their having shorter lengths of service on average than Christian chaplains. The Supreme Court considered two issues:

whether the reason for the disadvantage suffered by Mr Naeem had to be related to his religion or race; and whether the matter concerned all prison chaplains or only those employed since 2002.

The Supreme Court disagreed that there had to be any relation between Mr Naeem’s race or religion and the reason why the PCP in the case – the Prison Service pay scheme – put him at a disadvantage. The Supreme Court also decided that all the workers affected by the PCP should be taken into account, not just those employed after 2002.

The PCP identified was the incremental pay structure which affected all the chaplains employed by the Prison Service. [...]

Supreme Court upholds injunction to prevent disciplinary hearing going ahead

Law and Labour — Sun, 19 Jan 2014 18:04:15 +0000

The Supreme Court has upheld an injunction granted by the High Court to prevent a disciplinary hearing from going ahead in breach of an NHS Trust’s staff policy on conduct and capability.

The claimant in the case, Dr Chhabra, was a consultant forensic psychiatrist employed by the Trust about whom a number of complaints had been made in relation to her performance at work. Among the complaints was the allegation that she had breached patient confidentiality by dictating reports and reading documents while on a busy commuter train.

The Trust launched an investigation into the alleged misconduct. Its policy on conduct and capability specified how it should deal with disciplinary matters and distinguished between three levels of misconduct: minor, serious and gross. Following the completion of an investigation report, the Trust decided to treat the confidentiality issues as potential gross misconduct and to hold a disciplinary hearing.

Dr Chhabra sought an injunction to prevent the disciplinary hearing from going ahead. An injunction was granted by the High Court but this decision was overturned by the Court of Appeal. The question for the Supreme Court to decide was whether the case manager who was investigating the confidentiality issues was justified in convening a disciplinary hearing.

The Supreme Court found there were a number of irregularities in the disciplinary proceedings against Dr Chhabra that cumulatively rendered the convening of a disciplinary hearing as unlawful and a material breach of the doctor’s contract of employment.

These included:

the findings in the investigation report not being sufficiently serious as to warrant classification as gross misconduct; the case manager’s reliance on a version of the policy that had not existed at the time of the misconduct; the Trust allowing amendments to the report by a human resources director who the parties had agreed would not participate in the investigation; and the case manager’s failure to reassess the appropriate course for the disciplinary proceedings following the production of a second investigation report.

The Supreme Court directed that the Trust carry out a fresh investigation into the confidentiality concerns and be prevented from pursuing the confidentiality issue as a gross misconduct matter.

CASE Chhabra v West London Mental Health NHS Trust, Supreme Court, 18 December 2013