03 Jan 2017
As we enter the new year, we reflect on some of the main HR cases of 2016 and what they mean for employers.
1. Lock v British Gas Trading Ltd (No2) EAT
What, When & Who?In October 2016, an anticipated seminal judgement was made surrounding holiday pay and commission in the case of the Lock v British Gas ruling. In the pivotal case, which echoed similarities to an earlier decision in Bear Scotland v Fulton, it was ruled that holiday pay must include compensation for any results-based commission that would ordinarily be earned. Mr Lock worked as a Salesman. As is common within this profession, commission often featured as part of his pay, which fluctuated dependent on his performance and sales. While on holiday leave, Mr Lock argued that his pay did not reflect any commission that he would have earned, had he still been working. It was decided by The European Court of Justice (ECJ) that since Mr Lock’s commission was connected to the work he undertook, it should be taken into account when holiday pay was calculated.
Why should employers take note?The case returned to an Employment Tribunal for the ECJ ruling to be applied in UK law, meaning that some employers will now be required to include commission payments in holiday remuneration.
2. Aslam and others v Uber
What, When & Who?Routinely referred to as a ‘landmark’ case, this was one of the first and most monumental cases surrounding employment status of individuals engaged by companies operating in the renowned ‘gig economy’. In October, an Employment Tribunal ruled that Uber drivers are workers, not self-employed. This decision means that they are entitled to receive the national minimum wage, paid annual leave, and other benefits associated with the employment status. The claims appear to have caused a ‘domino effect’, with similar pending claims now against the likes of Excel, City Sprint and Hermes. An appeal against the decision is almost certain, so this case will also been one to keep an eye on for 2017.
Why should employers take note?It’s of paramount importance for employers to ascertain the employment status of all workers associated with their business. Employment status impacts the way employers treat individuals and the way workers should act. If handled incorrectly, this could cause employers financial and professional problems.
3. Metroline West Ltd v Ajaj
What, When & Who?In this case, the Employment Appeal Tribunal (EAT) had to decide whether or not “pulling a sickie” could amount to gross misconduct, which entitles the employer to terminate employment with immediate effect. The overriding question in this case concerned whether or not Metroline had reasonable grounds to believe, based on a reasonable investigation, that Mr Ajaj had misrepresented his injury and its effects, and the EAT found that it did. Specifically, the EAT judge commented that “an employee [who] “pulls a sickie” is representing that he is unable to attend work by reason of sickness. If that person is not sick, that seems to me to amount to dishonesty and to a fundamental breach of the trust and confidence that is at the heart of the employer/employee relationship.”
Why should employers take note?Faux illnesses and unwarranted ‘sickies’ are a considerable problem for employers. This case reiterates that “pulling a sickie” ultimately is misconduct. There are many options for employers to combat employee absences, such as reward for attendance, return to work interviews, identifying trends and more.
4. XC Trains Ltd v CD
What, When & Who?In this case, the EAT ultimately overturned an ET decision that an employer who denied a train driver’s flexible requests had indirectly discriminated her on the grounds of sex. It was viewed that while the ET had been correct in finding that XC Trains’ requirement of weekend work was possibly indirectly discriminatory, the ET hadn’t properly considered the employer’s justifications. Specifically, the ET hadn’t balanced the discriminatory effect of the requirement against the employer’s legitimate aims of providing a train service as needed by its franchise agreement, and the needs and rights of the driver workforce.
Why should employers take note?This case acts as a reminder that while employees have the right to request flexible working, the employer does not necessarily have to agree if they have a legitimate business reason. However, if an employer does reject a request, there must be justification for the refusal, which could consider business aims or alternatives.
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