Employment Law Review - October 2020

Welcome to our October 2020 Employment Law Review

This month we discuss:

Redundancies and consultation during the pandemicGender fluid / non-binary individuals covered by section 7 Equality Act 2010Backlog of tribunal casesA new furlough scheme?The raising of the state pension age for women from 60 to 65 did not give rise to unlawful age or sex discriminationTribunal makes the largest costs award to date to an employerCan an employer fairly dismiss an employee, without any formal procedure, where there is a breakdown in working relationships? The EAT says yesThe New Points Based System - A Simplified Approach to Employing Foreign Talent

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Redundancies and consultation during the pandemic

When it comes to redundancy consultations, furloughed staff can easily be overlooked as they are not in the workplace. Unfortunately, it can be an “out of sight, out of mind” scenario. Following HMRC's guidance that employees on furlough can be made redundant, it is even more important that employers consult with employees who are on furlough about redundancies. This is despite commentary from some trade unions, that a meaningful consultation is not possible.So, now that it is clear that furloughed staff should not be forgotten, and that it is possible to consult with them about redundancies, the question that arises is how should you consult with furloughed staff? There are a number of ways:

1. You can invite them in for consultation meetings, whilst adhering to social distancing and health and safety guidance;
2. If they're not currently using their work email address you should make sure any emails are sent to an address they have full access to; and
3. As face-to-face consultation may be undesirable in the current climate, you can consult using Zoom, Skype, Microsoft teams or a similar platform, or even via teleconference.

When consulting using online platforms, we have found that the following tips go a long way:

1. Ask the employee if there are any access issues. Some people may not have a laptop, or a sufficient internet connection. If that is the case, you may need to use a different mode of meeting;
2. Use screen-sharing for documents such as scoring cards or organisation charts, so everyone can see the same document at the same time - it will feel as though you are in a room together; and
3. Ask the employee to consent to recording the meeting. It can be difficult to take accurate minutes during a video-conference meeting due to issues with internet connectivity, people talking over each other, and the feeling of remoteness etc. so a recording which will be later transcribed may benefit both parties.

Despite the importance of consultation, you cannot force an employee to engage in meaningful consultation with you but you can make sure they are kept fully informed, have the opportunity to engage, and that you have clear records of your attempts to consult with them. If that is done, it would be difficult for an aggrieved employee to convince a tribunal that they were excluded from the process because of not having been at work.

 Gender fluid / non-binary individuals covered by section 7 Equality Act 2010

In September, the Birmingham Employment Tribunal upheld claims for harassment, direct discrimination and victimisation on the ground of gender reassignment brought against Jaguar Land Rover Ltd (JLR) by one of its engineers, Ms Taylor, who identifies as gender fluid/non-binary.Ms Taylor, who usually dresses in women's clothing, claimed that she was subjected to insults and abusive jokes at work, and suffered difficulties with the use of toilet facilities and managerial support.A person has the protected characteristic of gender reassignment if they are proposing to undergo, are undergoing or have undergone a process (or part of a process) for the purpose of reassigning their sex by changing physiological or other attributes of sex. JLR argued Ms Taylor, as gender fluid / non-binary, did not fall within the definition of gender reassignment under the Equality Act 2010 ('EqA').Noting that the question of whether a gender fluid/non-binary person fell within the definition of gender reassignment under the EqA 2010 was a novel point of law, the tribunal held that Ms Taylor was protected.The Tribunal held it was “clear... that gender is a spectrum” and that it is “beyond any doubt” that the Claimant fell within the definition of gender reassignment. The implication of this judgment is that other complex gender identities such as such as “a-gender” and “gender queer” may also fall within the definition of gender reassignment under the EqA, where individuals propose to undergo a process of moving their gender identity away from their birth gender.This judgment recognises that the rights of individuals with complex gender identities are protected by the EqA.

 Backlog of tribunal cases

According to the Law Society Gazette, Ministry of Justice data shows that as of August 2020, there was a backlog of 45,000 cases waiting to be heard at employment tribunal. This represents a 26% increase from the start of March. The Office for National Statistics revealed that the UK's unemployment rate also rose during this period from 3.9% to 4.1% from April to July 2020.At Freeths, we have seen that cases are being listed for final hearings anywhere from 12 - 18 months in the future. The tribunal backlog, which continues to grow, is due to a number of factors including the increase in redundancies, the continued rise since the abolition of fees and the listing difficulties as a result of the COVID-19 pandemic.On 14 September 2020, the President of the Employment Tribunals issued a new Practice Direction and Guidance for dealing with remote and in-person hearings during the COVID-19 pandemic, setting out the options for holding hearings and judicial mediations; including in-person, partly remote and wholly remote hearings. Despite this, it seems unlikely that the backlog will be cleared anytime soon. However, it is hoped that the measures will slow the rate of the increase.

 A new furlough scheme?

On 18 September 2020, the government published updated official statistics on the Coronavirus Job Retention Scheme (CJRS). The statistics revealed that the overall number of employees furloughed peaked at 8.9 million in May 2020 and has decreased ever since, with an estimated 5.3 million employees still furloughed or on flexible furlough by 31 July 2020.The CJRS is coming to an end on 31 October 2020 and the Government announced last week that the Job Support Scheme (the “Scheme”) will be introduced from 1 November 2020 to April 2021 to protect viable jobs in businesses who are facing lower demand over the winter months due to COVID-19, to help keep their employees attached to the workforce. Here's how the Scheme will work:

• Employers will continue to pay its employees for time worked, but the burden of hours not worked will be split between the employer and the Government (through wage support) and the employee (through a wage reduction).
• Support will be targeted at businesses that need it most, focusing on those that are being impacted by Coronavirus and who can support their employees doing some work, but that need more time for demand to recover.
• The Government's wage support will pay a third of hours not worked up to a cap (£697.92 a month), with the employer also contributing a third. This will ensure employees earn a minimum of 77% of their normal wages, where the Government contribution has not been capped.
• Grant payments will be made in arrears, reimbursing the employer for the Government's contribution. The grant will not cover Class 1 employer NICs or pension contributions, although these contributions will remain payable by the employer.
• Employers using the Scheme will also be able to claim the CJRS bonus if they meet the eligibility criteria.

All employers with a UK bank account and UK PAYE schemes can claim the grant. However, large businesses will have to meet a financial assessment test. There will be no financial assessment test for small and medium enterprises. For an employee to be eligible, they must have been on their employer's PAYE payroll on or before 23 September 2020. Furthermore, for the first three months of the Scheme they must work at least 33% of their usual hours.Like the CJRS, employees will be able to cycle on and off the Scheme but must cover a minimum period of seven days each time they are on the Scheme. Unlike the CJRS, employees cannot be made redundant or put on notice of redundancy during the period within which their employer is claiming the grant for that employee.Further guidance will be published by the Government shortly.

 The raising of the state pension age for women from 60 to 65 did not give rise to unlawful age or sex discrimination

On 15 September 2020 the Court of Appeal dismissed an appeal in R (Delve and another) v Secretary of State for Work and Pensions (Respondent) [2020] EWCA Civ 1199 against the High Court's refusal to grant a judicial review on the rising state pension age for women.The appeal was made by the "Backto60" campaign who campaign for the state pension age to revert to 60 for women. The campaign failed in their judicial review claim at the High Court last year. The claim challenged how the government increased the state pension age for women from 60 to 65 between 2010 and 2018 and campaign argued that the lack of notification about the increase has meant many women did not have enough time to adjust to the extra years without a state pension. In addition, it argued that raising women's pension age constituted unlawful discrimination on the grounds of age, sex and both combined.The High Court dismissed the claim on all grounds on the basis that there had been no discrimination but even if there was, it could be justified because the legislation had a legitimate purpose. As to notification, successive governments (since 1995) had engaged in extensive consultation with interested bodies before the legislation was made. The court also commented that, in the circumstances, its role was limited as it was a matter of primary legislation which is “very much within the area of discretion for the policy-maker".The campaign group appealed against the High Court's refusal to grant a judicial review and, as above, the appeal has subsequently been dismissed by the Court of Appeal. On 15 September 2020 the Court of Appeal held that:

• In terms of age or gender discrimination caused by the legislation equalising and then raising of the state pension age, there was no sufficient causal link between the withdrawal of the state pension from women in the age group 60 to 65 and the disadvantage caused to that group;
• The raising of the state pension age for women from 60 to 65 did not give rise to unlawful age or sex discrimination; and
• On the issue of the government's obligation to provide notice, there was no duty to notify those affected by the change. There had been “adequate and reasonable notification given by the publicity campaigns implemented by the Department over a number of years".

This will be a crushing blow for the Backto60 campaign who have been campaigning for years about the alleged unlawfulness of the rising state pension age for women. Backto60 have yet to release a statement.

 Tribunal makes the largest costs award to date to an employer

An employment tribunal has awarded an employer £432,000 in costs, which is thought to be the largest costs award made by an employment tribunal to date.The Claimant had unsuccessfully brought claims of unfair dismissal, age discrimination, race discrimination, sex discrimination, victimisation, harassment, whistleblowing detriment and unlawful deduction from wages following a redundancy process.The claimant, who was the Respondent hotel's (Millennium & Copthorne) former senior vice president of global procurement, left the hotel chain following a redundancy. The redundancy process was held by the tribunal to be fair. The claimant subsequently claimed he had been discriminated against and paid less than comparative colleagues because he is gay and of Chinese Singaporean ethnicity.The size of the cost award reflected the lengths that the claimant went to wrongly implicate his colleagues, including covertly recording them, which resulted in more than 3,000 pages of documents being brought before the tribunal. It also follows a judgment finding that the employee had been "duplicitous" and had undermined the trust and confidence between himself and his employer.Costs awards generally, and particularly, of this size, are rare. However, the decision will serve as a warning to employees bringing “unfounded and vexatious claims” against their employers.

 Can an employer fairly dismiss an employee, without any formal procedure, where there is a breakdown in working relationships? The EAT says yes

In Gallacher v Abellio Scotrail, the EAT had to decide whether the tribunal had been correct to find that the Senior Manager's dismissal was fair after she was sacked following a one to one meeting, without any forewarning.The tribunal found that there had been no formal dismissal process followed, nor any right of appeal. The absence of these steps are usually fatal for an employer. However, the EAT acknowledged that there is also no rule that a failure to follow any formal procedure will always render a dismissal unfair. It is a reminder that all of the circumstances in the case have to be considered.When taking into account all the circumstances of this case, the EAT was satisfied that a formal procedure would have made no difference to the finding that the working relationship had broken down.  Unusually, it held that a formal procedure would have worsened the situation.This does not mean that employers should dispense with formal dismissal procedures. However, there will be scenarios where an employer's approach to a dismissal can be much more commercial and pragmatic in circumstances where there has been an irreconcilable breakdown in working relationships.Read the full judgment here.Please contact the team if you wish to discuss any issues in this case further.

 The New Points Based System - A Simplified Approach to Employing Foreign Talent

On 13 July the government released further details on the Home Office's new points based system (“the New PBS”). The changes proposed in the policy statement will likely require much broader interaction between employers and the sponsor management system (SMS), but will in general make it far easier for employers to hire skilled foreign labour.The new “Skilled Worker Route” Under the New PBS the Tier 2 General route will be re-classified as the Skilled Worker route. In order to meet the requirements for the route an applicant must:

• Have a job offer from a Home Office licenced sponsor;
• Have a job offer at the appropriate skill level (RQF 3 or above (A level and equivalent)); and
• Speak English to the required standard.

If the applicant meets these criteria they will obtain the 50 mandatory points required.The novel element of the new Skilled Worker route is in the “tradeable” points. Whilst the applicant must obtain 70 points overall, the remaining 20 points can be made up from a selection of tradeable characteristics:Significant changes for skilled worker Sponsors

• Removal of the Resident Labour Market Test - Employers will no longer be required to advertise jobs to the settled workforce before offering the role to the prospective foreign employee. This will increase the speed at which vacancies can be filled by a month.
• Removal of the Tier 2 (General) Restricted Cap - The monthly cap on the number of restricted Tier 2 (General) visas issued by the Home Offices means there is no limit on the number of skilled workers who can come to the UK under the PBS. This again will have the result in speeding up the process through which vacancies can be filled.
• Removal of the “cooling off period” - Currently, the “cooling off period” prevents most Tier 2 visa holders from returning to the UK in the same category for 12 months following the termination of their visa. This will no longer apply to Skilled Worker visa holders, who will be able to apply to return to the UK immediately upon the expiry of their visas.

It should also be noted here that sponsors who currently hold Tier 2 (General) or Tier 2 (ICT) sponsor licences will be granted a new Skilled Worker licence or a new Intra-Company Transfer licence automatically, with an expiry date consistent with their current licence. Existing sponsors will also receive an appropriate allocation of Certificates of Sponsorship (CoS). Sponsors will not need to take any steps to do this.Intra-Company Transfer VisasWhilst the Tier 2 (ICT) visa route will be rebranded as the “Intra-Company Transfer Route”, it will not substantially change under the New PBS. The route still requires applicants to:

• Be in a role skilled to RQF6 or above (degree level); and
• Have a minimum salary of £41,500 or above depending on the requirements of the role SOC code.

However, under the new PBS Intra-Company Transfer applicants will require a minimum of 12 months service at the company in the relevant role prior to the transfer. This includes those who earn over £73,900 a year. Additionally, the new PBS introduces a more relaxed approach to the “cooling off period”, for the majority of Intra-Company Transfer visa holders they are required not to hold entry clearance or leave to enter or remain as an intra-company transferee for more than 5 years in any 6 year period. Other Important Deadlines and Changes

• EUSS Scheme - it is not too late for employers to hire prospective employees from the EU outside of the SMS. Any prospective EU employee must arrive in the UK before December 2020 and register under the EUSS before 30 June 2021.
• Graduate Visa Route - In summer 2021, the Graduate Route will open to allow international students to remain in the UK after graduation for work purposes for 2 years (3 years for PhD students). These visa applicants will not need to be sponsored.
• Highly Skilled Worker Route - Whilst we await further details from the government on this route (its will not open on 1 January 2021), this route has been proposed for highly skilled workers without a job offer. This route will complement the Global Talent, Start-Up and Innovator routes which seek to attract leading talent into the UK.
• Increase in Immigration Health Surcharge (IHS) - from 1 October 2020 HIS will increase from £400 to £624 per year per applicant.
• UVCAS IDV App - From 1 January 2020 the majority of EU applicants will not need to attend a visa application centre to enrol their biometrics. UVCAS has launched a smartphone app that will allow visa applicants to enrol their biometrics. It is the Home Office's long term strategy to move towards this approach for all applications.

If you would like to obtain legal advice relating to the effects of the upcoming changes on your business please contact Reece Ballett (reece.ballett@freeths.co.uk) or Emma Brooksbank (emma.booksbank@freeths.co.uk).

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