Comments are closed. Our resident experts at Pinsent Curtis Biddle bring you a comprehensiveupdate on all the latest decisions that could affect your organisation, andadvice on what to do about themBusch v Klinikum Neustadt, ECJ Reinforces protection for pregnant women under EU law, with implicationsfor new maternity and adoption leave rights * * * * Busch worked as a nurse at a German clinic. She started a three-yearperiod of parental leave in June 2000 when her first child was born, and becamepregnant again in October 2000. In January 2001 she asked to return to work,terminating her parental leave early. Her employer agreed a return from April2001. Busch told her employer she was seven months pregnant the day after herreturn. Restrictions on the work pregnant women could carry out under Germanlaw meant she could not carry out all her duties, and she was dismissed. Her employer alleged she had deliberately concealed her pregnancy andreturned to work solely to obtain a higher rate of maternity allowance. The ECJ emphatically rejected the employer’s claims of fraudulentmisrepresentation. A pregnant employee returning in these circumstances had noobligation to tell the employer that she was pregnant. The intention to obtainthe higher rate of allowance was irrelevant. The dismissal was an act of unlawful discrimination contravening thePregnant Workers Directive. The employer could not justify the dismissal byreference to the costs of having to employ someone who could not carry outtheir contractual duties. Financial considerations were of no relevance under the directive. The employer should have transferred Busch to lighter duties, or placed heron paid leave as a last resort. What you should do – Remember that from April 2003 the total period of ordinary and additionalmaternity leave is increased to 52 weeks and there is a new right to adoptionleave of equivalent length. Scenarios like the one in this case could arise – Employers with enhanced maternity and adoption leave schemes shouldconsider what happens under the contract if lengthy periods of leave are takenvery close together. As long as you comply with statutory obligations, you canlimit the number of payments within a certain period – Pregnant employees and job applicants have considerable protection throughsex discrimination laws and automatic unfair dismissal rules. Disruption to thebusiness because of pregnancy or maternity leave will never be an acceptablereason to dismiss an employee or refuse to employ one Bartholomew v LK Group Ltd, High Court Think carefully before labelling misconduct as gross misconduct * * * After a takeover of LK, Bartholomew was sacked as its managingdirector for gross misconduct. He was accused of unauthorised absences fromwork during normal working hours, and giving false accounts of his whereabouts.LK said Bartholomew’s accounts were at odds with its own surveillance reports.He claimed damages for wrongful dismissal, and the High Court upheld his claim.This case raises the important point that if employees reasonably believe theiractions are approved or condoned by the company, then it is not grossmisconduct. There were no grounds for summary dismissal. While Bartholomew keptirregular working hours and often carried out business from the library of hisLondon club (a novel form of flexible working), these idiosyncrasies werelongstanding and well known to fellow directors, who raised no objections. Bartholomew was entitled to believe they condoned his actions. Further, thecompany failed to show that he had deliberately given false information abouthis whereabouts. What you should do – Make clear the standards of behaviour expected, and enforce them properly – Do not ignore breaches of contractual terms if you want them to beenforceable – it risks a court finding the contract has been varied – Remember, in wrongful dismissal cases, the question is whether theemployee is guilty of conduct which amounts to gross misconduct. If thedismissal is for dishonesty or deceit, the employer must have evidence of this.In unfair dismissal claims, however, the question is different – does theemployer reasonably and honestly believe the employee has committed themisconduct after carrying out a reasonable investigation? Even under this test,there has to be material evidence on which to base that reasonable belief Stephenson v Delphi Diesel Systems Ltd A worker supplied by an employment agency could not be an employee ofthe client * * * * Stephenson signed on with employment agency Select in December 1999and was sent to work for Delphi as a machine operator. Delphi monitored hiswork and told him what to do on a day-to-day basis. He had to clock on and offshift and was given safety equipment by Delphi. However, his wages were paiddirectly by Select into his bank account. In August 2000, Stephenson obtained permanent employment with Delphi.Although Delphi now paid his wages, the work carried out was essentially thesame and he worked at the same workstation under the same supervisor. When he was dismissed in January 2001, Stephenson claimed unfair dismissal.He could only show sufficient continuity of service if he could claim employeestatus for the period he had been working as an agency worker. An employmenttribunal rejected his claim and the EAT upheld that ruling, for differentreasons. The EAT said there was plainly no contractual relationship betweenStephenson and Delphi until August 2000. Prior to that, his contract had beenwith the agency. In the absence of any contractual link between Delphi andStephenson, he simply could not be their employee. It would be unusual todescribe an individual as having a contract of employment with a party who hasno legal obligation to pay his wages and to whom he has no legal obligation togive work. The EAT also cast doubt on the one case in which the EAT has held that anagency worker was in fact an employee of the client – Motorola v Davidson. Inthat case, the lack of a contractual relationship between the worker and theclient was not raised on appeal. This suggests the Motorola case is not to berelied on – which is good news for employers who use agency staff. What you should do – Make sure the worker has a contract with the agency, not the client.Similar issues arise in relation to secondments – the two companies should havea contract with each other governing the secondment arrangements, but theseconded employee should only have a contract with the seconding employer – Be careful not to do anything that suggests an employment relationship. Ifthere are disciplinary issues, the client should raise these with the agencyand ask it to resolve them – Follow the progress of the Agency Workers Directive. New laws in this areawill come into force over the coming years, and the directive may be finalisedthis summer J Tomlinson Ltd v Beecroft & Others, EAT A TUPE case on the scope of a transferring entity * * * Integral had separate contracts with two councils for the service,maintenance and replacement of domestic gas appliances in the councils’residential properties. They employed six people on the two contracts. One ofthe contracts came up for renewal and a new contractor, Tomlinson, wasappointed. Two of Integral’s employees – the applicants in this case – spent 90 percent of their time working on this particular contract. The other four did somework on the transferred contract, but spent the majority of their time workingon the contract for the other council. Integral argued the two employees wereentitled to transfer under TUPE. Tomlinsons refused to employ them. Anemployment tribunal found TUPE applied. Tomlinsons’ principle argument was that there was no stable economic entitycapable of being transferred. It was argued that two employees out of sixworking on the contract in question could not be regarded as a discreteundertaking. The EAT rejected this argument. It agreed with the tribunal’s conclusionthat all six staff formed an economic entity – an organised grouping of peopleand/or assets which combined to perform a specific activity on a permanentbasis. The undertaking comprised the staff assigned to the two contracts.However, only the two applicants in this case could be regarded as assigned tothe part of the undertaking that transferred to Tomlinsons. The EAT also rejected the argument that because neither employee wasexclusively assigned to the individual contract in question (working on bothcontracts), there could be no economic entity. What you should do – It is common to find that an outgoing contractor’s workforce includesstaff who work on the transferring contract and other contracts as well. Thecomposition of the workforce should be investigated to establish whether thereis an undertaking capable of transferring and who is entitled to transfer – Remember, an employee is entitled to transfer under TUPE if they areassigned to the transferring undertaking. The amount of time spent working onthe contract in question is relevant to this issue but does not determine it.The test is an organisational one – Incumbent contractors should consider how the deployment of staff acrossdifferent contracts could affect their ability to transfer staff under TUPE ifa contract is lost Star ratings * Our rating system is designed to help busy HR professionals prioritise theirreading. Does this ruling have immediate implications for your practices andpolicies? Is it a one-off decision based on unusual facts? Or is it one to keepan eye on as it goes to appeal? Case round up will help you decide. Each caseis rated from one to five stars; the more essential it is that you know aboutit, the more stars it will have. Case of the month, by Christopher MordueJowitt v Pioneer Technology (UK) Ltd, Court of Appeal A reminder of the complications of paying contractual benefits throughPHI policies * * * * * Jowitt suffered an accident at work and was unable to do his job.Under his contract, after 26 weeks’ continuous absence he was entitled tolong-term sickness benefits for as long as he was certified ‘unable to work’ bya GP and the company’s own doctor. His employer was insured against payingthese benefits under a private health insurance (PHI) policy, but it providedthe insurer would only pay for employees ‘totally unable to follow anyoccupation’. The company’s doctor thought Jowitt was unable to work. The insurer’smedical adviser considered that Jowitt did not meet the policy definition ofdisability, as he could carry out some work, albeit not his actual job.Although the employer challenged the insurance company’s refusal to pay, itceased making disability payments to Jowitt, who brought a claim for unlawfuldeductions from wages. One complication in this case were the very different definitions ofdisability under the contract of employment and under the PHI policy. Thiscreated a risk that the employer would have to make the payments even if itcould not recover them from the insurance company. The critical question was whether Jowitt was really ‘unable to work’. Asthis was the wording in his contract, the terms of the insurance policy wereirrelevant. The EAT held that the employee had to be unable to carry out his actual job,and therefore upheld Jowitt’s complaint of unlawful deductions. The Court of Appeal overturned this decision. The term ‘unable to work’ wasnot limited to the employee’s actual job, nor did it mean the employee had tobe incapable of doing any purposeful activity. The issue was whether there wasany remunerative full-time work Jowitt could realistically be expected to do. The case was sent back to the tribunal to consider the conflicting medicalopinions. What you should do – Make sure the terms of the employment contract match those in the PHI orinsurance policy, so that you are only obliged to make contractual payments ifyou can recover the money from the insurance company – Make sure the contract is flexible so that it can be changed to reflectchanges in insurance cover – Make sure all notification requirements under the insurance policy are metin good time. Alerting insurers to potential claims allows issues such asdisputed medical opinions to be addressed early on. Employers are under a dutyto the employee to challenge an insurer’s refusal to pay – Remember employers cannot lawfully dismiss an employee who is in receiptof PHI benefits under their employment contract on account of sickness absence – PHI schemes are increasingly expensive and give rise to real legal andpractical problems, and some employers have withdrawn them altogether. Analternative is to fund the employee’s own insurance cover – this avoids thechain of contracts that can leave employers caught in the middle of disputes Case round upOn 1 Apr 2003 in Personnel Today Previous Article Next Article Related posts:No related photos.