February 19 Employment Law Enews

Welcome to the latest edition of Steeles Employment Enews.

AGENCY WORKER WAS NOT AN EMPLOYEE

The Court of Appeal has handed down a major agency workers judgment in the case of James v London Borough of Greenwich. In this case the Court was faced with deciding in what circumstances agency workers become employees of the end user. The Court concluded that where there is no express contract between the parties, the correct approach is to decide whether it is necessary to imply a contractual relationship.

Facts:

Ms James was continuously supplied to the Council through employment agencies over a period of three years. There were written agreements between Ms James and the agencies which stated that she would carry out work as a self employed temporary worker and that her work would not give rise to a contract of employment between herself and the end user. In particular, Ms James was not entitled to the Council's sick pay or holiday pay provisions and was paid by the agencies.

In 2003, Ms James changed to a different agency which paid a better hourly rate. In August and September the following year Ms James was off work due to illness. When she was fit to return, she was told that she was no longer required because the agency had sent a replacement. Ms James subsequently brought a claim for unfair dismissal and therefore had to establish that she was an employee of the Council.

Held:

The Tribunal held that there was a lack of the necessary "mutuality of obligation" for a contract of employment; the Council was not obliged to provide work and Ms James was not obliged to accept it. Ms James appealed but the Employment Appeal Tribunal ("EAT") upheld the Tribunal's decision.

The EAT noted that Ms James had switched employment agencies so she received a higher rate of pay and in their opinion, this was consistent with a recognition by her that she was an agency worker.

The EAT also stated that although the Tribunal had focused on the absence of mutuality of obligations it could have simply said that there was no necessity to imply a contract of employment in this case. The express contract between Ms James and the agencies made it clear that she was not an employee. Further, the fact that Ms James was a long term agency worker did not mean that it was inevitable that a contract of employment should be implied.

The Court of Appeal has now dismissed Ms James' appeal and approved the decision of the EAT, in particular the guidance given by the EAT on when it is necessary to imply a contract of employment.

Comment:

This decision has not moved the legal position any further in relation to agency workers as many people had hoped it would. It is still a matter for the tribunal to determine whether on the facts of an individual case, it is necessary to imply a contract of employment. However, it is reassuring for employers that the Court was satisfied that it will only be necessary to imply a contract of employment when an express contract is not genuine, and that the length of time an individual has worked for the end user will not be enough to confer employment status.

The Court also made it clear that it was not their responsibility to extend employment protection rights to agency workers and any changes in this area will have to come from Parliament.

EXPIRED WARNING CAN BE TAKEN INTO ACCOUNT

The Court of Appeal has overturned the decision of the Employment Appeal Tribunal in the case of Airbus UK Limited v Webb, holding that an employee was not unfairly dismissed when the employer took into consideration an expired warning when dismissing him.

Facts:

Mr Webb was an aircraft fitter employed by Airbus Limited (the "Company"). In July 2004, Mr Webb was summarily dismissed for gross misconduct. Mr Webb appealed against his dismissal and his sanction was reduced to a final written warning, which was to remain on his record until the end of August 2005 (12 months). He was also sent a letter stating that any further misconduct was likely to lead to his dismissal.

In September 2005, Mr Webb and four colleagues were caught watching television during working hours. The Company found them all guilty of gross misconduct. Mr Webb was dismissed but the other four were given final written warnings, as they had no prior disciplinary record. Mr Webb brought a claim of unfair dismissal against the Company.

Held:

The Tribunal stated that the employees' conduct amounted to gross misconduct and in the absence of mitigating factors it was within the range of reasonable responses for the employer to dismiss. However, the Tribunal held that following the decision of the Court of Session in Diosynth Llimited v Thomas, previous spent warnings should be ignored for all purposes and therefore Webb's dismissal was unfair.

The Company's appeal to the Employment Appeal Tribunal was dismissed, but the Court of Appeal has now overturned the Tribunal's decision.

The Court held that Diosynth could be distinguished from the present case on the basis that Mr Webb's dismissal was because he was found guilty of gross misconduct. The disciplinary record of Mr Webb (and the other four employees) was only considered by the Company in relation to mitigation. In Diosynth, however, the employer would not have had a justifiable reason to dismiss the employee in the first instance if they had not taken into account the previous warning.

Comment:

This decision is good news for employers, who will no longer be required to ignore expired warnings for all purposes when considering disciplinary sanctions. It will still be unreasonable for the employer to use the expired warning as the principal reason for dismissal, but it will not be unreasonable to take the warning and the underlying misconduct into account provided the subsequent misconduct was sufficient to warrant dismissal in its own right.

DISABILITY DISCRIMINATION BY ASSOCIATION

The case of Coleman v Attridge Law was referred to the European Court of Justice (ECJ) for determination by the Employment Tribunal, since it concerns the issue of whether the Disability Discrimination Act 1995 has correctly implemented the European Equal Treatment Framework Directive.

Facts:

Ms Coleman was employed as a legal secretary and brought a claim for disability discrimination following her employer's refusal to allow her flexible working arrangements to care for her disabled son. The claim was based on her son's disability rather than any disability of her own.

The Disability Discrimination Act 1995 (DDA) currently only prohibits discrimination on the basis of the complainant's own disability, and not on the basis of association with another person who has a disability. In order to succeed in her claim, it was necessary for Ms Coleman to establish that the Equal Treatment Framework Directive prohibited discrimination by association. The wording of the Directive refers to discrimination "on the grounds of disability", which she claimed was a broader definition than that in the DDA which prohibits discrimination on the grounds of the disabled person's own disability.

Advocate General's Opinion

In advance of the full judgment from the ECJ, the Advocate General has given his opinion in the case. In the majority of (but not all) cases the Court follows the Advocate General's opinion.

The Advocate General has agreed that the Directive does indeed prohibit discrimination by association and an employee can be a victim of unlawful discrimination if the disability of another is used to treat the employee less favourably.

If the ECJ follows this opinion (and it seems likely it will do), the case will go back to the tribunal to consider whether, on the facts of the case, Ms Coleman was discriminated against on the grounds of her son's disability. The tribunal will be required to consider whether the DDA can be interpreted in accordance with the wording of the Directive, or whether the DDA will have to be amended.

This case could have far reaching implications for employers, particularly in relation to carers of disabled relatives who could have grounds for claiming disability discrimination if they are refused time off to undertake their caring responsibilities.

The ECJ's decision is still likely to be several months away and we will cover this in a future issue of Enews.

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