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Thomas H. John, MRPharmS, Barrister-at-law, was
called to the Bar in 1997 and now has a full-time common law practice
from Chambers in Milton Keynes.
Correspondence can be forwarded to Mr John via Andrew Hutchins
(chief clerk) or Neil Goodman-Smith (practice manager) at Barristerweb,
Midsummer Court, 314 Midsummer Boulevard, Milton Keynes MK9 2UB
(tel 0845 123 1234). |
How to read this article
To obtain optimum benefit it is suggested
that practitioners read the question or questions posed at the
outset of the digest,
then read the facts and the issues arising, then the decision of
the
court together with the reasoning behind the decision. The question
or series of questions should then be reread and consideration
given as to whether any lessons can be learnt in terms of practitioners’ practices. |
The question
Have the recent regulations relating to part-time workers — The
Part-Time Workers (Prevention of Less Favourable Treatment) Regulations
2000 (SI 2000/1651) and the Fixed Term Employees (Prevention of Less
Favourable Treatment) Regulations 2002 (SI 2002/2034) — had the
effect of enhancing the rights of these groups, in any way, as against
their employers since they came into force on 1 July 2000 and 1 October
2002,
respectively?
The law
The first article in this two-part series considers whether the termination
of a fixed term contract of employment by simple efflux of time is
of itself capable of constituting less favourable treatment of the
employee in question, thereby amounting to unlawful discrimination
by his or her employer. (The second article will consider whether the
situation is any different for part-time workers and employees.)
From time to time, pharmacists with responsibility for the hiring and
firing of staff and the settling of terms of engagement during periods
of service may wish to engage workers on part-time or fixed-term bases.
Perhaps you are a pharmacist who is already engaged on such a basis or
is considering whether to take up an offer of employment on such terms.
Depending on the size of the pharmacy or department for which you are,
or will be, working, you may find you have, or will have, colleagues
who are doing comparable work but who are full-time or permanent members
of staff. If your fixed-term contract is shortly to expire or you are
being offered fewer hours per week as a worker who is already working
on a part-time basis, can you argue that your employer’s failure
to maintain your current weekly quota of hours is discriminatory when
viewed against the terms enjoyed by your full-time colleagues?
Conversely, as an employer you may be wondering whether to reduce your
current staffing levels or the number of hours you would wish to offer
your part-timers. Might you possibly be laying yourself open to allegations
of discrimination by doing so, thereby exposing you or your business
to a claim for damages? The case
Department of Work and Pensions v Webley. Court of Appeal (Civil Division)
(Lord Justices Ward, Jacobs and Wall). Judgment given 21 December
2004. This recent case before the Court of Appeal focused on whether the following
set of circumstances discriminated against a fixed-term employee who
was working under a series of short, fixed term contracts for a large
government department.
Facts Ms Webley was employed by the Department of Work and Pensions (the
DWP) under a series of short, fixed-term contracts. The DWP had a policy
of limiting the duration of all such contracts to 51 weeks. Ms Webley
worked alongside full-time colleagues doing comparable work and, in view
of the nature of the DWP’s workload, there would not only be a
continuing need for that type of work to be carried out beyond the foreseeable
future but there was also likely to be no diminution in the amount of
work passing through. Effectively the circumstances outlined above meant
that Ms Webley could not lawfully be made redundant. Any dismissal for
redundancy would be potentially unfair thus leaving the DWP open to an
unfair dismissal claim in an employment tribunal. Nevertheless the DWP
failed to renew Ms Webley’s contract at the end of the 51-week
term. She therefore brought a claim before the employment tribunal, not
for unfair dismissal on grounds of redundancy, but for unlawful discrimination.
In fact the tribunal found that the non-renewal of her contract was not
capable of amounting to less favourable treatment of Ms Webley and therefore
dismissed her claim.
She then appealed to the Employment Appeal Tribunal (EAT), the next tier
within the court hierarchy. The EAT is chaired by a High Court judge
who sits with two lay members and hears appeals from employment tribunals
on points of law. The EAT reversed the employment tribunal’s decision
and so the DWP appealed to the Court of Appeal for a ruling clarifying
the law and which would of course be binding on all lower courts and
tribunals.
The decision and reasoning The Court of Appeal agreed with the original
employment tribunal’s findings. It reaffirmed that fixed-term contracts,
far from being unlawful in themselves, respond in certain circumstances
to the needs of both employers and employees and were in fact recognised
as so doing by the EC in its directive (Council Directive 99/70), which
gave rise in the first place to the enactment of the FTE Regulations
by the UK government in
2002.
It followed, therefore, that the termination of such a contract by simple
efflux of time could not on its own amount to less favourable treatment
for a fixed-term employee in comparison with a full-timer doing comparable
work.
However — and this is where employers need to exercise care — there
must also be an objectively justifiable reason behind the existence of,
and the length of, the fixed term. In this particular case, the 51-week
rule could be justified under a Civil Service Order in Council of 1995
and the Civil Service Commission’s recruitment code.
Discussion
 In the field of employment law there have over the past 10 to 15 years
been a number of developments prompted by EC directives having the
aim of protecting and enhancing workers’ rights as against the
obligations owed by employers. With the advent of the Disability Discrimination
Act 1995 and now a third term for New Labour following the recent general
election, it will be seen that there is an opportunity for the Government
to cement certain rights now incorporated into UK law as a result of
the regulations made under these directives.
Two such directives handed down during the last government led to the
enactment of the FTE Regulations and the PTW Regulations. As secondary
legislation, these have the force of law and apply to all contracts of
employment coming into existence since the relevant commencement dates.
Both sets of regulations have as their aim the prevention of less favourable
(in other words, potentially discriminatory) treatment of fixed-term
and part-time workers when viewed against the treatment given to permanent
or full-time employees who are doing comparable work. The original driving
force behind both the EC directives and the UK Regulations was that evidence
was brought to bear during the late 1980s and early 1990s that many employees,
typically those not working full-time were being denied a number of contractual
benefits commonly enjoyed by full-timers, such as pension rights, holiday
pay and sick pay entitlements.
Fixed-term employees as a group certainly have the right not to be treated
less favourably than comparable permanent employees. That right is, of
course, additional to the existing right not to be unfairly dismissed.
However, as a result of the Webley case, it is now clearer that simple
non-renewal of a fixed-term contract on expiry of its term does not of
itself amount to less favourable treatment. The decision will maintain
flexibility within the workforce at large and leave open the scope for
negotiation between employer and employee over the period which
it is proposed the employee will remain in employment.
Employers still need to be aware of and seek to avoid situations where
reasons for terminating a contract are not objectively justifiable. There
is the danger in many commonplace situations that dismissals at the end
of a fixed contractual term would automatically be deemed unfair on other
grounds even if the length in time of the contract were not discriminatory.
These include, but are not limited to:
· Selection for redundancy
· Dismissals where the employee’s absence from work is connected
with pregnancy, childbirth, maternity, paternity or parental leave
· Discrimination on grounds such as trade union membership
Care must also be exercised where non-renewal of a fixed term contract
in any of the following situations is proposed. These situations are
those which may be viewed as potentially
unfair by Employment Tribunals. Again, the list is not exhaustive,
but simply reflects commonplace situations:
· Reasons of conduct on the employee’s part
· Commercial or business reasons, including selection for redundancy
(the last-in first-out rule is still a good rule of thumb for employers)
· The offer of a new contract to the employee but on less favourable
terms than previous contract(s)
In any of the above circumstances employers and employees would be well
advised to seek specialist legal advice before giving notice or dismissing
a member of staff.
If the taking of early advice is not practicable for any reason employers
should at the least seek to protect their position by, for instance,
offering the fixed-term employee a longer period of notice than would
be usual or sufficient opportunity to seek alternative employment either
within the same firm or, if this is not possible, with a reasonable amount
of paid time off to attend job interviews with other firms.
In summary the decision in Webley will undoubtedly serve to prevent claims
for
discrimination being brought simply because as fixed term worker’s
contract has time
expired.
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The
Pharmaceutical Journal