12: Employment Law Flashcards
The two types of working relationship?
Employee
- working under a contract of service
Self-employed (independent contractor)
- works under a contract for services
Tests to determine is an employment relationship exists (contract of service)?
These three elements must be present:
- worker must have agreed to perform work themselves unless employee expressly agrees to delegation
- element of control exercised by employer
- mutuality of obligations. Employer obliged to provider work or payment, and employee obliged to perform said work
If three elements of employment relationship are present, is the individual definitely an employee?
Not necessarily! Courts will consider:
- if free to delegate: self employed
- hours and payment are irregular: self employed
- employer provides tools, equipment and uniform: employment
- employer provides support staff: employment
- if paid net of tax: employment
- if exclusivity in contract: employment
Label applied by the parties does not define the relationship
What do employees get that self-employed do not get?
- statutory protection
- implied terms (ie. duty of obedience)
- employer is vicariously liable for the acts of employees in course of the business
- employee is a preferential creditor on insolvency (self-employed is ordinary unsecured creditor)
- employee gets pay net of income tax and NICs under PAYE (self-employed are trading income)
- certain benefits only available to employees
What is the third category of employment?
Worker
Group that fall short of being recognised as employees, but still provide work for an organisation, so not self-employed
Some protection to workers
- payment of minimum wage
- minimum amount of paid leave
Not others!
- protection against unfair dismissal
- right to request flexible working
How are the most basic rules of an employment contract different?
They’re not!
Like any other contractual relationship
Basic rules apply, and standard elements of agreement, consideration and intention must be present
Can sue on breach
Terms are express or implied
What are the express terms of an employment contract?
Agreed by the parties themselves
Agreement is written or oral
Change in terms requires consent of both parties, unless made by legislation
Express term sometimes gives employer right to vary terms. Must be reasonable!
- ie. Mobility clause
What written particulars must be included in a contract?
Employee Rights Act 1996 requires this, must be provided on or before first day of employment
- name of employee and employer
- pay rates and interval
- job title
- hours of work
- date employment commences
- if any service with previous employer counts towards continuous employment
These instead be referenced on where to find them:
- notice period
- holiday or sick pay
- pension
- grievance and disciplinary procedures
These do not constitute contract but provide evidence of contents of contract
What terms are implied by courts?
Implied duties or employer and employee!
Six implied duties of the employee?
Obey lawful and reasonable orders
- if your employer asks you to do something legal and reasonable, do it!
Give honest and faithful service
- duty of fidelity. ie cannot work for competitor!
Exercise reasonable care and skill
- single act of negligence wont dismiss you but gross negligence will
- also duty to indemnify employer for damages as a result of employee’s negligence (have to pay employer)
Not to misuse confidential information
- do not disclose trade secrets
- or misuse confidential info
- continues after employment has ended
Give personal service
- has to carry out work personally
- or has express or implied permission to delegate
Mutual co-operation
- mutual obligation imposed on both parties
- respect and consideration for each other
Implied duties of the employer?!
- pay reasonable remuneration
- indemnify employees for properly incurred expenses
- take reasonable care for employees safety
- give reasonable notice for termination
- maintain mutual co-operation, trust and confidnece
- provider work (or pay)
- observe sustainability regulations
Do not have to:
- provide references (but must be truthful if so)
The 5 terms implied by statute?
Pay
Health and Safety
Social security law
Equality Act 2010
Notice
How is pay implied by statute?
Minimum wage!
Also holiday and sick leave
Equality clause is implied into all contracts, if employees of opposite sex to same job or different job of equal value
How is H&S implied by statute?
HASWA1974 imposes:
All employers required, so far as reasonably practicable, to ensure H, S and welfare of employees. Includes:
- provision and maintenance of plant and systems to make them safe
- arrangements for safe use, handling storage and transport of articles and substances
- information, training and supervisoon
- maintenance of safe places of work
- provision and maintenance of a safe working environment
Breach: criminal offence. Up to 2 years prison and unlimited fine
How is social security law implied by statute?
Different laws including:
- obligation to pay Class 1 NICs
- flexible working requests must be considered and not unreasonably refused
- ante-natal care
- maternity/paternity leave and pay
- parental leave and pay
- parental bereavement leave
How is Equality Act 2010 implied by statute?
Employees have right not to be discriminated against due to a ‘protected characteristic’
Covers all terms of contract: pay, hours, etc
Protected characteristics are:
- age
- disibility
- sex (orientation and reassignment)
- race (colour, nationality and ethnicity)
- religion or belief
- marriage or civil partnership
- pregnancy or maternity
When can employers avoid the Equality Act 2010?
If they can prove their actions were a ‘proportionate means of meeting a legitimate aim’
Aims include: H&S, specific training requirements
Proportionate: discriminatory effect is significantly outweighed by benefits of achieving aim.
If aim can be achieved with less discrimination, that should be followed!
How is notice implied by statute?
Minimum notice by employer depends on continuous employment period:
1 month to 2 years: not less than one week
2 years to 12 years: not less than one week for each year of employment
- 1 week x years of employment
From 12 years: 12 weeks
Minimum notice by employee: 1 week, if worked there for 4 weeks
Normally a matter of negotiation, but can never be less than these statutory minimums
What is unfair dismissal regulated by?
The Employment Rights Act 1996
Updated by Employment Act 2008
Both provide statutory protection
Claims brought before employment tribunal
Who cannot claim for unfair dismissal?
Excluded employees
Certain categories who are excluded
- persons employed to work outside GB
- employees dismissed while on unofficial strike or other industrial action
Who can claim for unfair dismissal?
Those who have been continuously for at least two years, part time or full time
No requirement for this if dismissal is automatically unfair!
Possible to exclude certain weeks in continuous employment, such as time on strike or service in armed forces
If business is transferred, does not break continuity
What must the employee show for unfair dismissal?
- they were a qualifying employee
- they were dismissed
When can an employee make a claim for unfair dismissal?
Claim must be made to Employment Tribunal within 3 months of date of termination
Date of termination is:
- if termination given by notice, day the notice expires
- if no notice, day termination takes effect
- if fixed term contract not renewed, date on which fixed term expires
What are the three types of dismissal?
Termination of a contract by the employer (with or without notice)
Expiration of a fixed term contract
Constructive dismissal
What is constructive dismissal?
An employee terminates the contract by reason of the employee’s conduct
Employee’s conduct must be sufficiently serious for an employee to have to leave at once
If they continue, they could be seen as affirming the contract, which could make them lose the right to treat themselves as dismissed
How is it determined whether a dismissal has occurred?
Each case is viewed on its own facts
Employees that has been employed for at least two years can write a written statement giving reasons for dismissal within 14 days
What is NOT a dismissal?
- employee resigns (unless constructive dismissal)
- contract is frustrated
- parties come to a mutual agreement
What are the automatically unfair reasons for dismissal?
Victimisation of H&S complaints or whistle-blowers
Pregnancy or using maternity leave
Trade union membership and activities
Assertion of statutory right
Spent conviction
Taking steps to protect themselves in imminent danger
Transfer of an undertaking
How does an employer demonstrate that a dismissal was fair?
They have to show:
- principal reason for dismissal
- that the reasons was one of more of the statutory fair reasons in ERA1996
- that they acted reasonably
What are the 5 statutory fair reasons for dismissal?
Capability or qualifications of employee
- lack of either for performing the work
Conduct
- guilty of misconduct
- ie. abusive language, drink and drugs, etc
Redundancy
- can be unfair if employee was selected in breach of customary arrangements or because they are connected with trade union membership
Statutory restriction
- prevents employment being lawful
- ie. Professional forgets to renew certificate
Some other substantial reason
- ie. Conflict of interest
- conviction of offence involving dishonesty
How does a tribunal decide if an employer acted ‘reasonably’?
On the basis of equity and substantial merits of the case, did the employer act reasonably?
Reasonableness test involves two questions:
- was the reason sufficiently serious to justify dismissal?
- did the employer adopt reasonable procedures in coming to decision and manner of decision?
Examples of when an employer is NOT reasonable with an unfair dismissal?
Employee is dismissed without warning
If dismissal on grounds for capability and the employer did not allow time for improvement, training and consultation
If dismissal on grounds of ill health, must be proper medical evidence
If misconduct, employer must fully investigate complaint and listen to employee by way or explanation and mitigation
What is procedural irregularity?
Dismissal may be unfair if it was carried out in breach of any procedures relating to workplace dispute resolution
If this happens, tribunal may increase award up to 25%
May reduce award by 25% if unreasonable failure by employee
Three remedies for unfair dismissal?
Reinstatement
- employee may return to old job, if it is their wish to do so
Re-engagement
- employee offered new job with comparable terms and seniority
- not given if there is a breakdown in confidence between two parties
Compensation
- usual remedy
- three types: basic, compensatory and additional
What are three types of compensation award?
Basic award
- depends on: age, pay, length of continuous service
- amount is reduced if employee caused or contributed to dismissal
- award made regardless of loss suffered by employee, no duty to mitigate
Compensatory award
- discretionary
- amount that is just and equitable in regards to the employee’s losses
- up to statutory maximum
- assess on principals of damages
Additional award
- made if order for reinstatement or reengagement is ignored
- grounds of discrimination
- automatically unfair dismissal
How is wrongful dismissal different from statutory dismissal?
Wrongful dismissal - common law concept
- employees get normal protection and remedies under common law
Can be County or High Court, or Employment Tribunal again
Claim for damages in wrongful dismissal might be preferable to damages for unfair dismissal
When might a claim for wrongful dismissal be preferable to a claim for unfair dismissal?
When damages sought exceed statutory minimum for unfair dismissal
Where deadline for commencing unfair dismissal claim has passed
- wrongful dismissal can be brought within 6 years of breach
When dismissal is fair, but insufficient notice is given
Employee lacks two years continuous service
What is wrongful dismissal?
When the employee is dismissed in beach of contract
What is summary dismissal?
Dismissal without the required notice period. Held to be wrongful unless:
- due to a fundamental/serious breach by employee
- employee accepted shorter notice
Also occurs when employer is unable to continue employing the employee, where:
- personal employer dies
- partnership dissolved
- company wound up
Termination without notice by employee?
Repudiates contract by leaving
Breach unless:
- employer has wrongfully repudiated contract
- employee accepts the breach by leaving
When is expiry of a fixed term wrongful dismissal?
If employee is dismissed before the expiry of the term
If employee is employed to perform a task and is dismissed before the completion of that task
Remedies for wrongful dismissal?
Normal remedy will be damages
- based on loss of earnings suffered
Employee is under duty to mitigate a loss
- alternative work must be sought in the intervening period
If damages are not adequate
- court may award an injunction to prevent breach of contract
- like never happens
What is redundancy?
If dismissal is wholly or mainly attributable to the fact that:
- employer has ceased to carry on business for the purpose or in the place on contract
- requirements for that business to carry out work of a particular kind or in particular place have ceased or diminished
When is there not a redundancy situation?
When then the transfer of location is reasonable
Or
When the contract gives them the employer an express or implied right to move the employee from one place to another
How should a person claim a redundancy payment? And conditions?
Person must:
- have been continuously employed for two years
- apply to employee tribunal within six months of dismissal
- prove they were dismissed, laid off or kept on short time for at least four consecutive weeks
Define laid off and short time?
Laid off: employee earned nothing in that particular week
Short time: earned less than half of a normal week’s pay
When is there no entitlement to a redundancy payment?
If the employee is:
- guilty of misconduct which would justify dismissal
- made a reasonable offer of a renewed contract
- made an offer of suitable alternative employment in the same capacity, which they unreasonably refuse
If the latter, employee can have four-week trial period, from end of previous job
