August 2012 Employment Law Newsletter


If you would like to discuss any employment issues please contact Julie Taylor on 01635 508181

1. Fiduciary duties

The Court of Appeal has determined that employees do not automatically owe their employer a fiduciary duty – such a duty must arise out of the terms of the contract of employment.

This means that employees will owe an implied duty of fidelity meaning that they must do their job faithfully and in accordance with the implied term of trust and confidence, however, they are not required to put the interests of their employer before their own. Employees could, therefore, be entitled to make preliminary plans for a competing business while they are still employed, which could include having conversations with potential clients for the new business.

Therefore, employers who are concerned about the risk of employees planning to set up competing businesses should ensure that their contracts of employment include adequate post-termination restrictions and that they take specific legal advice to ensure the contract includes all possible protections.

2. Redundancy

The Employment Appeal Tribunal has clarified that a reduction in headcount is not necessarily required for redundancy. In other words, if the amount of work available for the same number of employees is reduced, then a dismissal of an employee caused wholly or mainly for that reason can still be a redundancy.

This means that employers who wish to reduce the number of hours worked by their staff should seek their agreement to a reduction in hours and if agreement is not reached and it becomes necessary to dismiss an employee, the employer should take specific legal advice and may need to budget for making a redundancy payment.

3. Reasonable adjustments

The Employment Appeal Tribunal has held that an obligation to make reasonable adjustments does not necessarily end when an employee goes on sick leave. This means that if adjustments would enable an employee, absent through illness, to return to work, the employer is under a duty to make such adjustments as are reasonable.

This highlights the importance of employers keeping the cases of employees who are off sick under regular review, especially where a disability is involved, and legal advice should be sought where necessary.

4. Social media

An employment tribunal has determined that an employer was vicariously liable for comments relating to an employee’s sexual orientation that were posted on his Facebook page by his colleagues by using his phone during working hours. The comments in this case were untrue but nevertheless the tribunal found that they had caused the employee embarrassment.

This is a clear reminder that employers will be liable for discriminatory acts by their employees towards colleagues if such acts ‘fall within the course of employment’ unless the employer can show that it took ‘all reasonable steps’ to prevent the acts from happening. The tribunal was satisfied in this case that the act of updating the Facebook status fell within the course of employment because the update was posted using the employee’s phone at work, during working hours and therefore involved dealings between staff.

ACTION POINTS include ensuring a clear social media policy is in place that has been communicated to all staff and employers should take disciplinary action where any breach of policy occurs. Employees should also be encouraged to make use of password protection features where their own equipment is taken into the workplace.

5. Dismissal for breakdown of trust

The Court of Appeal has held that a breakdown of trust did amount to ‘some other substantial reason’ for dismissing an employee in a case where the employing organisation had public interest duties, including in relation to the vulnerability of children, and had received police information that the employee was considered a threat to children.
This case highlights that while a breakdown of trust may amount to a fair reason for dismissing an employee, fairness will depend on the specific facts of the case. Additionally, the Court stressed that this could not be used as a convenient label for any situation where the employer feels let down by an employee.

When acting on third party information, even if received from the police, about an employee’s alleged wrongdoing, employers should adopt a probing and critical approach to the information in the disciplinary investigation if the employee does not admit the alleged conduct. As always, legal advice would be important in this situation.

6. Maternity rights and redundancy

ACAS, in partnership with the Equality and Human Rights Commission, has produced a guide on managing redundancy for pregnant employees or those on maternity leave.

The guide provides a useful explanation of the protection provided, a checklist and addresses some common myths. A copy of the guide can be found here.

7. Vetting and barring scheme

The vetting and barring scheme for organisations who engage people to work with vulnerable people or children will be scaled back with some changes effective from 10 September 2012. The intention is to make the system more proportionate and the main changes include abolishing registration and continuous monitoring requirements, redefining ‘regulated activity’ and abolishing the concept of ‘controlled activity’. The barring function will be retained.

Employers who employ staff to work with children or vulnerable adults should ensure that they are familiar with the changes – details can be found here.

Please note that these comments are intended to summarise some of the employment issues of the moment, not to provide detailed legal advice, so if you need assistance with any employment issues you may have please contact Julie Taylor on: 01635 508181.

Follow Julie on Twitter: @JulieT_GL

Share this Newsletter

<i class=