Employment case round-up


Constructive dismissal: Genuine mistake still a fundamental breach of contract

Employers should be mindful that a mistake in respect of pay, even if genuine and honestly made may leave the employee with strong, unlawful deduction from wages and constructive dismissal claims.

In Roberts v The Governing Body of Whitecross School, the EAT found that the School had intentionally breached Mr Roberts’ contract by its failure to pay him the correct amount of sick pay, despite the mistake being genuine. Upon the commencement of a period of sick leave Mr Roberts was initially given full pay.  The School incorrectly interpreted Mr Roberts’s contract as entitling them to place him on half pay, as the injury was not ‘physical’ in nature. The School told Mr Roberts that his pay would be reduced at a specified future date. Mr Roberts resigned two days before he was due to move to half pay and brought claims for an unlawful deduction of wages and constructive dismissal.

The ET found for Mr Roberts, in respect of his wages claim, but disagreed that there had been a fundamental breach of contract as the School had been genuinely mistaken in its interpretation of his contract.  Mr Roberts took his claim to the EAT who concluded that there had been a fundamental breach, sufficient to entitle Roberts to resign as it concerned wages. The EAT stated that the School had made a deliberate decision to halve an employee’s sick pay which amounted to a fundamental breach of contract.  There was found to be an intention to implement the pay deduction. The honesty and genuine mistake were irrelevant.  The case was remitted to the ET to deal with the question of whether Roberts had resigned in response to the breach.


Zero hours contracts held to be umbrella contracts of employment

The EAT’s decision in Pulse Healthcare Ltd v Carewatch Care Services Ltd & 6 others is a reminder that employers should always ensure that their expectations and intentions in respect of a contract of employment are reflected in the reality of the relationship. 

Carewatch had a contract with a Primary Trust to provide care for a patient with severe disability.  The care package devised for the patient called for no less than 15 people, working on shifts to look after her. Carewatch engaged five carers under a ‘zero hours’ contract to provide this care.

When the Primary Care Trust terminated its contract with Carewatch and engaged Pulse Healthcare, the carers claimed that they had transferred to Pulse under TUPE. One argument that Pulse submitted was that the carers were on ‘zero hours’ contracts and, as such, there was no “mutuality of obligation”.   

The EAT supported the ET’s rejection of this argument. The reality was that, whilst the contract on paper was for ‘zero hours’, the carers had for a number of years been working a fixed working pattern. Carewatch would fix a rota which the individual carers were required to fulfil, they were not permitted to provide a substitute.  The EAT stated that, whilst it is possible for employees to raise objections to such rotas when announced, it remains open to an employer to treat refusal to fulfil a rota as a breach of contract. The EAT, citing the nature of the work in support of its decision, stated that the work was extremely challenging and wholly unsuitable for Carewatch to have in place adhoc arrangements for the patient’s care. 


Misconduct – matters to be taken into account

In Nejjary v Aramark Ltd, the EAT has held that, when considering whether dismissal fell within the range of reasonable responses, a tribunal can only take account of the reasons for dismissal operative in the employer's mind at the time.

In 2009, Aramark suspended Mr Nejjary because of performance issues. Aramark regarded all of the three incidents individually as gross misconduct and, as a result, dismissed him. Mr Nejjary appealed and, whilst Aramark conceded that two of the incidents would not count against him, they did not overturn their decision as the one remaining issue amounted to gross misconduct in itself. It did not take his previous employment record into account.

The employment tribunal found that Aramark had dismissed Mr Nejjary fairly.  Had Mr Nejjary had an unblemished record, Aramark’s decision would have been outside the range of reasonable responses. However, taking his previous disciplinary record into account, it was reasonable for Aramark to treat his conduct as a sufficient reason for dismissal. Even if the dismissal was unfair, Mr Nejjary’s contribution to his dismissal was 100%.

The EAT upheld Mr Nejjary’s appeal. The tribunal had erred in taking into account matters which the employer had not.  When applying the reasonableness test, the tribunal should have confined itself to the single, specific incident of misconduct relied on by the employer. Given that the tribunal felt that this single incident was not in itself sufficient to render the dismissal reasonable, the EAT substituted a finding that the dismissal was unfair. In addition, the EAT held that the tribunal erroneously took into account matters that were not causally connected or related to the dismissal  when considering contributory fault.


Equality Act 2010 can be interpreted as covering post-employment victimisation

In Taiwo v Olaigbe and others, an employment tribunal has held that a claimant could pursue a claim of post-employment victimisation under the Equality Act 2010 (“the Act”).

Ms Taiwo was employed by Mr and Mrs Olaigbe as a nanny. She left employment, and brought a race discrimination claim against them. During the race discrimination proceedings, the employers sent the trial bundle to the United Kingdom Border Agency requesting it revisit Ms Taiwo's immigration status. Ms Taiwo brought a fresh claim, arguing that this amounted to victimisation contrary to the EqA 2010. The employers argued that this claim should be struck out because section the Act expressly excludes post-employment victimisation complaints.

At a pre-hearing review, the judge allowed Ms Taiwo’s post-employment victimisation claim to proceed. The Judge stated that, on the face of it, section 108 of the Act, grants the right to bring complaints of post-employment discrimination and harassment, but not post-employment victimisation. However, this appears to be a drafting error.

Applying a purposive approach to the legislation to give effect to EU law, the judge concluded that the victimisation provisions of the Act apply to former employees as well as current ones.

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Thrings Solicitors