Topic 17: Employment Law: Contracts & Ending contracts

Question 1

What is employment status? What tests can be done to find out if employee?

Answer 1

Employment status is when “an individual who has entered into or works under a contract of employment” under Employment Rights Act s.230

Three common law tests:

• Control
• Integration
• Mixed/economic reality

Question 2

What contractual terms are employees entitled to be notified of when commencing employment?

Answer 2

Employment Rights Act s1

Written particulars:
- Within 2 months to receive document stating their contract.

• Terms of employment including duties
• Whether employment is for a particular time or permanent
• Sources of obligations and pay
• Pension details
• Info regarding redundancy etc and others.

Question 3

What are the implied terms applicable to employers?

Answer 3

• to pay wages;
• in the case of industrial action being accepted by the employer, to pay a fair proportion of wages;
• to provide work for the employee;
• to maintain the health and safety of their workers;
• maintain mutual trust and confidence in the employment relationship

Question 4

What are the implied terms applicable to employees?

Answer 4

• mutual trust and confidence;
• fidelity; (loyalty/support)
• duty to disclose the misdeeds of others;
• co-operation;
• to use reasonable skill and judgement;
• obey lawful orders;
• adapt to new working conditions.

Question 5

Compare the remedies of wrongful dismissal and unfair dismissal

Answer 5

Unfair dismissal can involve re-instatement and re-engagement whereas wrongful cannot.

Wrongful dismissal doesn’t have a financial cap in the courts whereas unfair does which is either 98.2k or one years gross pay, whichever is lower.

Question 6

Explain the common law mechanism of seeking damages for wrongful termination

Answer 6

Employee to make a claim for wrongful dismissal in the Employment Tribunal within 3 months from the date of termination of his employment, and within 6 years if the claim is being made through the courts.

Question 7

Whats a summary dismissal? How is this different to normal dismissal and wrongful?

Answer 7

Where the employer terminates the contract of employment immediately. It can be justified or unjustified.

Justified = fundamental breach of contract

Unjustified = receives PILON (Payment in lieu of notice that is normally required)

Question 8

Whats a summary dismissal? How is this different to normal dismissal and wrongful?

Answer 8

Where the employer terminates the contract of employment immediately. It can be justified or unjustified.

Justified = fundamental breach of contract so they can.

Unjustified = receives PILON (Payment in lieu of notice that is normally required).

Normal gives notice period etc then why they are firing with valid reason. Wrongful is when it’s without reason.

Question 9

Explain the obligations of an employer who wishes to transfer the undertaking (TUPE)

Answer 9

• New employer (transferee) liable for any claims / liabilities against the former employer by employees.
• The employee may refuse to transfer to the new employer and this ends their contract but does not amount to a dismissal.
• The employee who has transferred may not be subject to worse terms imposed by the new employer but can benefit from more favourable terms introduced by the transferee.
• A dismissal due to a relevant transfer will be unfair unless the transfer is due to an economic, technical or organisational reason. This enables the new employer to justify the dismissal as being ‘potentially’ fair.

Question 10

To explain the obligations on the employer to consult with employees

Answer 10

Employers are obliged to consult with employees and their representatives regarding planned redundancies and transfers, unless there exist ‘special circumstances’ for not consulting.

Fine of £75k as penalty for not consulting.

Question 11

What factors make the selection process for redundancies fair and unfair

Answer 11

• membership or non-membership of a trade union, or activities connected with the membership (Trade Union and Labour Relations (Consolidation) Act 1992 s. 153);
• pregnancy or childbirth, or if the employee has asserted statutory rights or made complaints under health and safety legislation (ERA 1996, s. 105);
• selection due to the discriminatory policy or its non-application

Question 12

What case law can be used to enable a fair redundancy process?

Answer 12

Williams v Compair Maxam Ltd (1982)

• Employer cannot cherry pick the employees that they want to keep on.
• They need a proper redundancy criteria from which they select the employees who are to be put at risk of redundancy.

Question 13

What case law can be used for Unfair dismissal? (when undergoing a TUPE)

Answer 13

Polkey v AE Dayton Services (1988)

The House of Lords held that the following test should be used by the courts:

• the employer must warn and consult the employee who has been affected.
• The employer must also adopt a fair basis on which to select for redundancy and apply the criteria fairly;
• employer must take steps to minimise the redundancy by redevelopment in its organisation

The House of Lords decided that Mr. Polkey was unfairly dismissed. Under S.57(3) Employment Rights Act 1996, there must be a sufficient reason to dismiss the employee.