E-NEWS: 28 June 2002

Welcome to the latest edition of enews produced by Steele & Co. In this issue we report on:

* MATERNITY, PATERNITY AND ADOPTION LEAVE CONSULTATION
* TRANSSEXUAL FACTORY WORKER SETTLES SEX DISCRIMINATION CLAIM FOR £22,000
* CLEANER WHO LOST 60P AN HOUR WINS EQUAL PAY CLAIM
* EMPLOYER MISCONDUCT AND STIGMA DAMAGES

Maternity, Paternity and Adoption leave and pay

The overhaul of the rules governing the rights of employees with recently born or adopted children is nearing completion. Commencing in 2000 with publication of the "Work and Parents: Competitiveness and choice" Green Paper, which was followed up by various other consultation documents and proposals the final proposals should all be implemented by April 2003

The Department of Trade and Industry have recently issued five sets of draft regulations and what may be a final consultation paper. For those who want to participate in the consultation process please contact the DTI website by no later than 19th July 2002 at: www.dti.gov.uk/er/workparents_consult.htm#Intro

Transsexual Factory Worker Settles Sex Discrimination claim for £22,000

A post-operative transsexual who was dismissed from her job as a production operative after making a complaint of sex discrimination is to receive £22,000 in compensation in settlement of her claim.

Clare Steen was given work in an all-male team and directed towards the male changing rooms. She also claimed that she was aware of 'blokey comments' being made about her transsexuality and that her team leader treated her and spoke to her in an abusive manner which she did not believe he would use with other women.

Her initial appraisal in May 2001 recorded that she displayed "the right attitude" and "fitted in well" with her team. However, two months later she was dismissed on grounds of unsuitability for the job with her employer citing 'unfounded allegations against other employees, and an unwillingness to play a full part in the team' as reasons for her dismissal. Her dismissal took place shortly after Ms Steen raised concerns about her treatment with her managing director and head of human resources.

The £22,000 compensation agreement covered Ms Steen's loss of earnings to the date of the tribunal, approximately one year's future loss of earnings, and £10,000 for injury to feelings.

The Sex Discrimination (Gender Reassignment) Regulations 1999 came into force on 1st May 1999 and are a measure to prevent discrimination against transsexual people on the grounds of sex in pay and treatment in employment and vocational training. The Regulations reflect a ruling by the European Court of Justice that the dismissal of an employee undergoing gender reassignment is contrary to the European Equal Treatment Directive.

Cleaner Who Lost 60p An Hour Wins Equal Pay Claim

A female cleaner who found out she was earning 60p less per hour than a man who worked as a cleaner for the same company has won her case of sex discrimination and victimisation.

The cleaner had been working for eight months before discovering the pay difference and having raised the matter with her employer was told that the male cleaner had been trained to use certain pieces of machinery that only male cleaners used.

The cleaner's position was labelled a grade 4 post, while the man's post was a grade 3 post. However an employment tribunal found the different grading could not be justified objectively and that the employer could only justify employing male employees at a higher rate by making their posts grade 3. The tribunal having strongly advised the employer to arrange for the assessment of the grading system against an objective and professionally recognised grading scheme stated that "the grading system itself is unsupportable... it disproportionately disadvantages women who provide the bulk of the lower grade of the workforce".

The cleaner was awarded compensation of £2,540; £540 of which accounted for the difference in pay and the remainder £2,000 in damages for injury to feelings and aggravated damages on account of the bullying she received having made her initial complaint.

Employer Misconduct And Stigma Damages

"Outrageous" was the word used by George W Bush following the discovery of an alleged £2.5bn fraud that is widely expected to result in the collapse of a second multi-billion dollar corporation in recent weeks. The US financial watchdog, the Securities and Exchange Commission (SEC) has declared WorldCom's accounting improprieties as having been of "unprecedented magnitude".

Following in the wake of the recent Enron scandal the cloud over WorldCom once again raises the issue of an employee's entitlement to claim stigma damages in respect of the handicap he/she may experience in the job market by reason of their employer's unlawful conduct.

The principle of stigma damages was first recognised in English Law following the House of Lords' decision in Malik v BCCI and requires an employee to prove that their former employer's unlawful conduct resulted in them suffering a financial loss by reason of their inability to secure alternative employment. The employee is therefore regarded as having been tainted with the stigma of his/her former employer.

Of the 17,000 employees whose redundancies were announced this week it is expected that only the relatively few senior accounts executives are likely to be at potential risk of being stigmatised.

It remains to be seen whether legal proceedings are brought by Worldcom employees in the UK or if any stigma may be attached to Arthur Anderson employees whose employer were responsible for approving the accounts of WorldCom as well as Enron.

We will keep you informed of further employment law developments.

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This bulletin is intended for general guidance only and should not be relied upon without detailed legal advice on your specific circumstances.

This article copyright © 2002 Steeles Law. All rights reserved.