Employment Law

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1 Employment Law

• Distinguish employees, workers and the self-employed by the real relationship, including personal service, control, mutual obligations and whether the individual is genuinely in business on their own account

• Courts apply 3 tests

  • Control test (Mersey Docks v Coggins)

  • Integration test (Cassidy v Ministry of Health)

  • Economic reality test (Readymix Concrete)

• Difference is important because :-

  • Tax and social security contributions

  • Sales tax

  • Employment protection provisions

  • Vicarious liability

  • Liquidation

2 Employment Law

• Indicators that a worker is self-employed

  • Own tools and equipment

  • Ability to delegate

  • Ability to choose which hours to work

  • Ability to accept or refuse work

  • Ability to take holidays without restrictions

  • Paid for the project

  • Work for different organisations

• But no individual indicator is normally sufficient

• Courts will consider all the circumstances

• And it doesn’t matter what the ‘employer’ / ’worker’ have agreed between them – it’s the economic reality which is important

3 Dismissal

• 4 types

• Summary – serious breach of contract by employee

• Constructive

  • Reduction in pay rate

  • Change in the nature of the job

  • Failure to follow proper disciplinary procedures

  • Failure to provide appropriate working environment

  • Failure to provide suitable work

• Wrongful

• Unfair

4 Wrongful Dismissal

• Not wrong if justified. If wrong, remedy is damages – lost earnings

• Justified if :-

  • Disobedience

  • Dishonesty

  • Incompetence / negligence

  • Immorality

  • Drunkenness

  • Misconduct

    • Accepting money

    • Assault

    • Disclosure of information

5 Unfair Dismissal

• Automatically unfair

  • Imprisonment is not automatically unfair; the employer must identify a potentially fair reason and follow a fair procedure

  • A transfer-related dismissal is generally automatically unfair unless there is an economic, technical or organisational reason entailing workforce changes

  • Exercising rights re length of working day

  • Insistence on minimum wage

  • Certain workers have statutory protection relating to Sunday working, subject to the relevant conditions

  • Taking steps to ensure health and safety

  • Trade union membership or activities

  • Whistle blowing

6 Unfair Dismissal

• Ordinary unfair-dismissal claims generally require two years’ continuous employment; automatically unfair grounds are separate

• Specific statutory exclusions or restrictions

  • Participation in unofficial industrial action may restrict ordinary unfair-dismissal protection under statutory rules

  • National-security cases are governed by specific statutory and procedural rules

• Potentially fair

  • Incapable

  • Not competent to do the work for which employee is qualified

  • Redundancy, see later

  • Legal reasons eg losing driver’s licence when employed as a chauffeur

  • Losing qualifications – eg becoming disqualified as a doctor

7 Redundancy

• A form of dismissal from employment caused by the employer needing to reduce the workforce

• Reasons include:-

  • new technology or a new system makes your job unnecessary

  • the job no longer exists

  • the need to reduce the labour costs means staff numbers must be reduced

  • the business is closing down or re-locating

• If fewer than 20 redundancies are proposed, individual consultation applies

  • this involves direct consultation and ...

  • ... looking at any alternative to redundancy

  • if no consultation takes place, any redundancy may be unfair dismissal

• If 20 or more redundancies are proposed within 90 days at one establishment, collective consultation applies

• Collective consultation is with employee representatives and must start at least 30 days before the first dismissal for 20–99 redundancies, or 45 days for 100 or more

• if no consultation takes place, a claim to an Employment Tribunal could result in compensation of up to 90 days’ pay

• selection of redundant workers should be fair and objective

• Unfair or non-objective redundancy selection may make the dismissal unfair; it is not automatically unfair in every case