Employment Update: June 2024

Labour publishes employment law proposals: With a general election now scheduled for 4 July, the Labour Party has released a range of proposals to reform employment laws and practices:

• Single status of “worker” – The distinction between “employees” and “workers” could be removed to create a single category of “worker”. This could have a number of implications, including that the full suite of employment rights (e.g. unfair dismissal, sick pay and parental leave rights) would potentially apply to all staff other than those who are genuinely self-employed. This would be a major shift from the current employment status framework and employers would need to fundamentally rethink the way in which they engage with certain types of staff (e.g. casual or zero-hours workers) who do not currently benefit from full employment rights.

• ‘Day 1’ rights – All workers would be entitled to “basic individual rights” from their first day of employment. The full set of “basic individual rights” is not yet confirmed, but it would include the right to bring unfair dismissal claims. This would be a significant departure from the current qualifying period of two years’ service and could require employers to demonstrate a fair reason (and follow a fair process) for all dismissals, even where an employee has only been employed for a short period.

• Default to flexible working – Labour proposes to make flexible working the default position from the first day of employment for all workers, except where this is “not reasonably feasible”. This suggests an automatic right to work flexibly unless the employer can prove it is unfeasible to do so, rather than the current right to request flexible working (which can be rejected by an employer on certain statutory grounds). The right to flexible working is likely to be an area of continued litigation, as we have already seen claims from employees resisting attempts by their employers to return to more regular office working.

The above proposals are part of a wider package of employment reforms set out by Labour (including further proposals around pay fairness, a right to “switch off”, family-friendly rights, redundancy and TUPE). The proposals will be debated over the coming weeks, when we can also expect the other political parties to release their own proposals on similar issues.

When does a “volunteer” become a “worker”? The Employment Appeal Tribunal (EAT) has ruled that a volunteer was a “worker” during any periods for which he was paid (Groom v Maritime and Coastguard Agency). In determining whether someone is a “worker” (and entitled to associated rights, such as the National Minimum Wage and paid holiday), the test is broadly whether they work under either: (a) a contract of employment; or (b) some other contract to provide their services personally. Mr Groom did not have any written contract but was entitled to claim payments (which were more than just reimbursement of his expenses) for performing certain activities. In the EAT’s view, these payments shifted the arrangement from a purely voluntary one to a contractual relationship which satisfied the worker status test. The judgment is a reminder for organisations who use volunteers (e.g. events businesses) that whether someone is genuinely a volunteer for employment law purposes will depend on how they are engaged in practice.

Job redesign was a breach of contract: An employer breached an employee’s contract by unilaterally changing her role and duties, despite having a right in the contract to do so (McCormack v Medivet Group Ltd). After her job title was changed and some of her responsibilities were reallocated to a colleague, Dr McCormack resigned and claimed that she had been forced out of her role in breach of contract. Whilst the High Court accepted that the employment contract contained a flexibility clause allowing the company to change Dr McCormack’s executive office or responsibilities, it found that the company failed to exercise its rights under that clause honestly or rationally (citing the lack of proper consultation or genuine performance concerns which might have justified reallocating her responsibilities). The decision is an example of the limitations of contractual flexibility clauses, which should always be exercised reasonably and cautiously to avoid the risk of breach of contract or constructive dismissal claims.

Was dismissal discriminatory where disability was a minor factor? A decision to dismiss can still be discriminatory even if it is only partly based on conduct arising from an employee’s disability (Ms N Bodis v Lindfield Christian Care Home Ltd). In this EAT case, an employee was dismissed following a disciplinary process, during which she was alleged to have given “short and evasive” answers. Although the nature of her answers was only a “trivial” factor contributing to her dismissal, the fact that her responses were impacted by her disability (namely, her anxiety and depression) meant that the dismissal could still be discriminatory.

If you have any questions, or if you would like to discuss an employment issue, please do get in touch.