June 2013 Employment Law Update


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

1.    EMPLOYMENT LAW CHANGES: Whistle-blowing – removal of good faith requirement, addition of public interest requirement

Under the current whistle-blowing legislation there is no requirement for a disclosure of information made by an employee or a worker to be in the public interest. This means that currently disclosures about a breach of an employee’s own employment contract could be protected by the legislation. From 25 June 2013 the information disclosed must also be in the public interest.

Currently, if a worker seeks to disclose information because they reasonably believe that one of the following has, will or is about to occur, there will be a qualifying disclosure where they have acted in good faith:

i.    a criminal offence
ii.    breach of a legal obligation
iii.    miscarriage of justice
iv.    danger to health & safety of any individual
v.    deliberate concealment of information regarding any of the above

The changes introduced on 25 June 2013 add the “public interest” requirement and remove the “good faith” requirement, although tribunals will be given the power to reduce compensation where a disclosure is not made in good faith by up to 25%. The definition of “worker” for the legislation will also be amended.

This means that to be protected under the legislation, whistle-blowers will have to demonstrate their reasonable belief that the information they disclose tends to show, one of the above examples AND their reasonable belief that the disclosure is made in the public interest.

A further change means that whistle-blowers will have the right not to be subjected to any detriment by co-workers or agents of their employer for having made a protected disclosure. In such a case, the employer will be vicariously liable, regardless of whether it knows or approves the behaviour. However, employers should have a defence where it can show all reasonable steps were taken to prevent victimisation.

This highlights the importance for employers of having a policy on whistle-blowing in place. Where any disclosures are made, the implications should be carefully considered and legal advice should be obtained where necessary.

2.    MORE EMPLOYMENT LAW CHANGES: Unfair dismissal – no qualifying period for a unfair dismissal claim where the claim is based on political opinions or affiliation

From 25 June 2013 there will be no requirement to have worked for an employer for two years before being eligible to bring an unfair dismissal claim based on the employee’s political associations.

This amendment to the legislation was required following the recent European Court of Human Rights decision in the case of Redfearn –v- United Kingdom. This case determined that UK law was in breach of the European Convention on Human Rights because there currently no protection for employees from dismissal on grounds of their political associations, whereas article 11 of the European Convention provides a universal right of freedom of assembly.

This change simply removes requirement for the employee to show a qualifying period of service before bringing an unfair dismissal claim: it does not create a new ground for discrimination or a new form of ‘automatically unfair’ dismissal. The change will not apply to dismissals before 25 June 2013.

Employers should ensure that they follow the correct procedures before dismissing any employee, and seek legal advice where necessary, particularly if issues about political or religious affiliation are concerned.

3.    Restrictive covenants & enforceability

The High Court has determined that a 12 month non-solicitation restrictive covenant in an insurance broker’s contract was enforceable, awarded an injunction with an award of damages to follow.

The covenant was upheld because the employer was able to demonstrate that at it had a legitimate interest to protect in it’s client relationships and that the restrictive covenant included in the contract was no wider than reasonably necessary to protect that interest.

The insurance industry context was important because the restriction was consistent with other insurance businesses and in line with the employee’s expectations when he joined the company because it was similar to a covenant contained in the contract he had with his previous employer. The purpose of the 12 month duration was specifically to allow time for a relationship to be built up between the company’s clients and the employee’s replacement. It is worth noting though that the Court made it clear that a longer restriction would not have been enforceable.

Where restrictive covenants are included in employees’ contracts and their enforceability is important for the protection of the business, employers will need to justify the point and extent of any restrictive covenants. Legal advice should be sought where necessary.

This case also considered the employee’s claim that his employer had committed a repudiatory breach of contract by initiating a sham redundancy consultation entitling him to resign and claim constructive unfair dismissal, however, this argument was rejected by the Court. This is a useful reminder of the care that employers should take when initiating discussions that may lead to termination and highlights the importance of sticking to the procedures.

4.    GUIDANCE: preventing discrimination

The Equality and Human Rights Commission has published guidance for small businesses on human rights issues and how to prevent discrimination and avoid costly legal challenges. The guidance provides a useful explanation of how the Equality Act 2010 relates to business, including explanations of legal definitions and practical advice to help businesses during recruitment and promotion processes.
See the guidance here:  http://www.equalityhumanrights.com/advice-and-guidance/here-for-business/guidance-for-small-and-medium-size-businesses/

5.    GUIDANCE: update service for criminal records checks

The Disclosure and Barring Service (DBS), has launched a new ‘Update Service’ from 17 June 2013. Under this new service job applicants will be able to pay an annual fee of £13 and prospective employers will be able to check the status of the individual’s DBS certificate online at no additional cost once they have the individual’s permission to carry out a check. Volunteers will be exempt from paying the annual subscription fee.

The service will enable individuals to move between jobs without the need for applying for a separate criminal records check each time as long as the level and type of check required for each job is the same. The DBS will carry out regular searches to ensure that DBS certificates are kept up to date.

From 17 June 2013 DBS certificates will be sent to individual applicants only and will therefore no longer be sent to the registered person who countersigned the application form. The means the individual will be able to review and, if necessary challenge, the contents of a certificate before it is seen by an employer or prospective employer.

The DBS has published a series of guidance notes for employers and employees explaining how the DBS will work. Copies of these can be found here:


6.    VICTIMISATION: Ex-employee was protected

The Employment Appeal Tribunal (“EAT”) has confirmed that an ex-employee was protected from victimisation after their employment had ended. This is important for employers to be aware of because since the introduction of the Equality Act 2010, and a decision last year by the EAT in a different case that there was no protection for employees after their employment ended, there has been uncertainty surrounding this issue.

This case warns that employers should err on the side of caution and assume that ex-employees are protected against victimisation.

7.    Covert surveillance & unfair dismissal

The EAT has determined that the use of covert surveillance in an investigation into an employee’s misconduct did not affect the reasonableness of the procedure and decision and overturned the employment tribunal’s finding of unfair dismissal (although the compensation had been reduced to £0 as result of contributory conduct in any event).

The original tribunal considered that the employee’s rights under the European Convention of Human Rights had been breached, specifically his right to privacy, which led to the finding of unfair dismissal, however, the EAT found that the employee had no expectation of privacy when he was defrauding his employer (he was claiming pay for being still at work when in fact he was playing sport).

Employers need to be wary that the outcome of this case was seems to have been influenced by the fraudulent behaviour of the employee and that the video was taken in a public place which was not private and during time that the employee was being paid. Therefore, this case does not mean that covert surveillance will always be considered to be a reasonable or proportionate part of a disciplinary investigation and in fact, instances where this is acceptable are likely to remain rare. Employers should always take care with disciplinary investigations and I would suggest legal advice is sought when gathering information in this way is being considered.

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 or  [email protected]

Follow Julie on Twitter: @JulieT_GL

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