It looks as though 2017 will be a busy year for employment law, with a number of important cases set to be decided. We have commented upon just a few of these below, dealing with: employment status and the gig economy, holiday pay, Employment Tribunal fees and whistleblowing.
Employment status and the gig economy
In recent times, the “gig economy” has grown significantly, in no small part because of the expansion of companies like Uber and Deliveroo. Towards the end of 2016, a survey suggested there were as many as 5 million individuals providing services within the gig economy in the UK. Those individuals would not ordinarily receive a wage, but would instead be paid for the particular piece of work or “gig” that they undertake – such as a taxi journey or a take-away food delivery. These are flexible arrangements and the individuals concerned are classified as independent contractors, often without guaranteed hours or job security. Historically, the individuals would not receive paid holiday or be guaranteed to receive at least the National Minimum Wage.
In November 2016, in the case of Aslam and others v Uber BV and others, an Employment Tribunal decided that Uber drivers should in fact be classified as workers for the purposes of employment law and therefore, were entitled to certain benefits such as holiday pay and the National Minimum Wage. Immediately following the decision, Uber publicly stated that it intended to appeal the decision, the grounds for appeal have however yet to be confirmed.
Following the Uber decision and at the end of last week (Friday 6 January 2017), an Employment Tribunal decided, in the case of Dewhurst v CitySprint UK Ltd, that Maggie Dewhurst, a bike courier, should be classified as a worker rather than self-employed. The result being that she was entitled to holiday pay. At the time of writing, there are several others similar cases being brought against companies in the gig economy and so further decisions are expected throughout this year.
It will be interesting to see if the other cases continue to follow the same approach, thereby ensuring that those in the gig economy now have certain employment rights. This area of law will of course be of interest to those within the gig economy, but may also effect those providing their services as contractors, freelancers, on demand or even on a purported self-employed basis as they may find themselves being entitled to such benefits as holiday pay for the first time.
Over the last few years, there have been numerous cases pursued through the Courts and Tribunals concerning holiday pay. These cases have dealt with entitlement to holiday pay, carrying over entitlement from one year to the next and how holiday pay should be calculated.
In the case of Lock v British Gas Trading Limited, Mr Lock was a sales consultant and received a basic salary and commission based upon sales he made, the latter of which amounted to approximately 60% of his total remuneration. During his holidays, he was predominately paid his basic salary only seemingly because he could not secure commission generating sales during that time. The Employment Tribunal decided that Mr Lock’s holiday pay should however be made up of both salary and a payment for commission lost, to reflect a more normal level of pay during holidays. Although, it was made clear that this would only apply during the basic and minimum four week holiday entitlement.
British Gas subsequently and unsuccessfully appealed the decision to both the Employment Appeal Tribunal and the Court of Appeal. The Court of Appeal confirming that the Working Time Regulations 1998 could be interpreted to require an employer to include a sum for commission in holiday pay.
Following which, British Gas have now applied for permission to appeal to the Supreme Court. The hearing is expected to take place this year. Hopefully, the Supreme Court will clarify the position once and for all and provide clear guidance as to how the commission paid during holidays should be calculated. Clearly, the decision will be of importance for anyone who routinely receives commission during their employment and may have serious financial implications for employers.
Employment Tribunal fees
On 29 July 2013, fees were introduced in both the Employment Tribunal and the Employment Appeal Tribunal. The common types of fees payable are the issue fee (payable when a claim or appeal is started by the party taking such action) and the hearing fee (payable in advance of the hearing by the party who brought the claim or appeal). In the Employment Tribunal, the particular fees payable will depend on the type of claim, with Employment Tribunal claims being categorised as a “Type A” or “Type B” claim depending on their complexity, with the issue fee being £160 or £250 respectively and with the hearing fee being £230 or £950 respectively.
The fees have led to a significant drop in Employment Tribunal claims, with a House of Commons Justice Committee Report published in June 2016 citing a drop of up to 70% in the number of claims being brought. The fees have been unpopular with employees and Trade Unions alike. UNISON has consistently challenged the fees regime and made two applications for judicial review with the ultimate aim of having the fees declared unlawful. Whilst both applications were initially unsuccessful, UNISON was granted permission to appeal to the Supreme Court. The hearing will take place on 27 and 28 March 2017.
The decision of the Supreme Court will be of interest to anyone involved in pursuing a claim.
If a worker makes what is called a “qualifying disclosure”, which in general terms is the disclosure of information which in their reasonable belief is made in the public interest and tends to show that at least one of the six types of specified wrongdoing has taken or is likely to take place, they are protected against suffering a detriment or from being dismissed. The words “in the public interest” were added in June 2013, principally to limit workers pursuing claims concerning only their own contracts.
In the case of Chesterton Global Limited (t/a Chestertons) and another v Nurmohamed, which dates back to April 2015, the Employment Appeal Tribunal decided that Mr Nurmohamed could pursue a whistleblowing claim following a disclosure based upon his own contract of employment and in particular, the level of commission that he received. Mr Nurmohamed, a senior manager at an estate agents, had on three previous occasions and following changes to his commission structure, complained about manipulation of the company’s accounts which he believed adversely effected his commission payments and resulted in lower commission payments for 100 senior employees (including himself). Mr Nurmohamed was subsequently dismissed and succeeded with his claim for unfair dismissal on the basis that he had made a qualifying disclosure. Chestertons unsuccessfully appealed, with their argument being that Mr Nurmohamed’s disclosure was not in the public interest and simply motivated by concern about the value of his own commission payments. Both the Employment Tribunal and Employment Appeal Tribunal were fairly liberal and generous in their definition of what was in the public interest.
Chestertons have now appealed to the Court of Appeal and the appeal is due to be heard in June. The key issue to be decided is whether it is necessary to show that a disclosure was of interest to the public as a whole. If the appeal succeeds, it will arguably narrow what can amount to a qualifying disclosure.
Should you wish to discuss this or any other employment law related issue further, please contact BakerLaw’s Head of Employment Andrew Peters on 01252 730766 or at email@example.com