• In this employment law update, we look at some key case law decisions from 2021 and look ahead to what employers should expect in the year ahead.

    For further information on the issues covered here, view our recent employment law update webinar.

    2021 key cases round up

    Sleep in shifts and National Minimum Wage

    The long-awaited Supreme Court judgment in Royal Mencap Society v Tomlinson Blake was handed down in March 2021. The court held that individuals carrying out “sleep-in” shifts are not entitled to national minimum wage for time spent asleep at, or near, the workplace. Such workers are only entitled to national minimum wage when they are awake “for the purposes of working”.

    This was a particularly key decision for the charity and care sector, which faced significant liability for historic back pay had the outcome been different.

    Anti-harassment training

    In Allay (UK) Limited v Gehlen, the Employment Appeal Tribunal (EAT) emphasised the importance of anti-harassment and diversity training being up to date and fit for purpose.

    In this case, an employer’s “stale” diversity training was not enough to defend a claim of harassment brought by an employee who had seen subjected to racist comments by a colleague in the workplace.

    Employers are normally responsible for any discriminatory or harassing acts committed by their employees. However, there is a defence under the Equality Act 2010, for an employer who would otherwise be responsible, if the employer can show that it took “all reasonable steps” to prevent the employee from doing that discriminatory act.

    This case highlighted that having a policy and putting equal opportunities training in place is simply not enough – equal opportunity policies should be regularly reviewed, and refresher training provided as needed.

    Menopause discrimination

    Can menopause symptoms amount to a disability? Yes, said the EAT in the case of Rooney v Leicester City Council. In the first binding decision on the issue, the EAT held that it was wrong for a tribunal to find that an employee suffering from significant menopausal symptoms was not disabled under the Equality Act 2010.

    Menopause itself is not specially mentioned in the Equality Act 2010 However, as this case shows, there is no reason in principle why menopausal symptoms cannot have the relevant disabling effect on an individual to afford the protection from discrimination under the Act.

    With a growing focus on menopause in the workplace, this case highlights those employers should take heed of and address these symptoms.

    Redundancy appeals

    The Court of Appeal in the case of Gwynedd Council v Barratt and Others confirmed that a failure to offer an appeal in a redundancy situation does not, on its own, automatically render a redundancy dismissal unfair.

    The court held it would be wrong to find a dismissal unfair if lack of appeal is only defect in otherwise fair process. Instead, a tribunal will look at all the factors in any process before determining whether a redundancy process is fair.

    Many employers will offer an appeal in a redundancy situation as a matter of course, and there are benefits to doing so. In some situations, there may be reasons why holding an appeal might not be recommended, and the absence of the appeal may not be fatal.

    Addressing the gender pay gap

     The case of Bayfield and Jenner v Wunderman Thompson UK Ltd generated headlines in 2021 as a cautionary tale for employers looking for a ‘quick fix’ to address gender pay gap issues.

    Shortly after publishing an “embarrassing” gender pay gap report, the respondent advertising agency gave a presentation at a conference, pledging to “obliterate” its reputation for being full of “straight white men”.

    The two claimants (who were white, British, heterosexual men in their fifties) raised concern with the messaging. They were dismissed shortly afterwards as part of a wider redundancy exercise.

    The tribunal upheld their claims for sex discrimination, victimisation and unfair dismissal, finding that they had been dismissed because of their sex. This decision highlights that there is no quick fix to addressing systematic gender pay gap issues. Promoting one group of employees at the expense of another is likely to be ineffective as well as potentially unlawful.

    COVID-19 case law

    2021 saw the first of the COVID-19 cases reaching the tribunals, with some key points emerging.

    These included:

    • Employees have a duty to obey reasonable and lawful instructions issued by their employer – including those around PPE and COVID-19 safety measures (Kubilius v Kent Foods)
    • An employer’s failure to consider placing a care worker on furlough affected the fairness of her subsequent redundancy dismissal (Mhindurwa v Lovingangels Care Ltd)
    • A breach of COVID-19 guidelines (rather than laws) may not of itself be sufficient grounds to dismiss an employee (Meynell v Stephenson)

    Although these have been first instance decisions (and not binding on other tribunals) they will be of interest to employers with current live claims in the tribunal system.

    Other key decisions

    Further high-profile cases in 2021 included the Supreme Court decision in the Uber v Aslam case, which held that Uber drivers definitely have the status of workers.

    Although a very fact-specific case and judgment, it is a useful reminder for business who engage self-employed individuals to review their own arrangements.

    The case of Kostal UK v Dunkley is of interest to employers who recognise a trade union. The Supreme Court held that making a direct pay offer to employees covered by a collective agreement is unlawful. Such direct offers can only be made once the collective bargaining process has been genuinely exhausted. Employers who recognise a trade union need to ensure that they follow any collective bargaining framework agreed with the union.

    The EAT held in the case of Forstater v CGD Europe, that gender-critical beliefs are capable of being protected under the Equality Act 2010 as a philosophical belief.

    The case was concerned only with the narrow legal issue of the scope of a philosophical belief but is of interest for highlighting that some beliefs may be capable of protection, even if they are controversial.

    What to expect in 2022

    Gender pay gap reporting

    For those businesses to whom it applies, gender pay gap reporting is due by:

    • 30 March 2022 – public sector
    • 4 April 2022 – private sector

    There is also speculation about the introduction of new ethnicity pay gap reporting, but there are no clear plans as yet.

    Pay costs

    Increasing payroll costs are likely to be a key issue for many employers and HR departments in the coming year. With December 2021 inflation reaching a 30-year high, employers are likely to find themselves under more pressure to increase wages.

    On top of this, we will see additional cost pressures with National Minimum Wage/living rates going up on 1 April 2022 and the introduction of the social care levy on 6 April 2022.

    We advise employers to start looking at their existing pay structures as early in the year as possible, given the increases which will be coming into effect in April.

    National Minimum/Living Wage

    From 1 April 2022, the following rates will apply:

    Age group Current New % Increase
    23 and over​ £8.91​ £9.50​ 6.62​
    21 or 22​ £8.36​ £9.18​ 9.81​
    18 – 20​ £6.56​ £6.83​ 4.12​
    Under 18 (above compulsory school age​ £4.62​ £4.81​ 4.11​
    Apprentices under 19 (or over 19 in year 1 of apprenticeship​ £4.30​ £4.81​ 11.86​

     These are significant pay increases. Increasing pay at the bottom end of the pay scale will likely lead to a knock-on effect to increase pay levels above National Minimum/Living Wage levels.

    Health and Social Care Levy

    6 April 2022

    A new social care levy will be introduced UK-wide from 6 April 2022 to help fund health and social care. In 2022, this will be collected via a 1.25% increase in National Insurance rates for employers, employees and the self-employed. It will not be payable by those earning under the NICs threshold (currently set at £9,568 (2021/22).

    From 6 April 2023, it is expected that this will be collected as a separate Health and Social Care Levy at a rate of 1.25%.

    People above State Pension age will not be affected by the temporary increase to National Insurance contributions for the 2022 to 2023 tax year but will be liable to pay the levy from April 2023.

    Other rates

    Family friendly leave

    From 3 April 2022, there will be a 3.09% increase in the following statutory family payments:

    • Statutory maternity pay
    • Statutory adoption pay
    • Statutory paternity pay
    • Statutory shared parental pay
    • Statutory parental bereavement pay

    These rates will increase to £156.66, up from £151.97

    These normally take effect on the first Sunday in April, which in 2022 is 3 April.

    Sick pay

    Statutory Sick Pay will also rise on 6 April 2022 by 3.11%.  The new rate will be £99.35, up from £96.35.

    This increase may have a knock-on effect on employers who offer enhanced or company sick pay schemes.

    Statutory redundancy payments

    A weeks’ pay is currently £544 per week. This will increase from 6 April 2022 to £571.

    The new amount will be confirmed in the draft Employment Rights (Increase of Limits) Order 2022, which should be published some time in February.

    Right to work checks

    Although the concept of right to work checks is not new, there are several changes effective from 6 April 2022 which employers should be aware of.

    They include the implementation of a new Identity Document Validation Technology (IDVT) process, and changes for those that hold a Biometric Residence Card, Biometric Residence Permit or Frontier Worker Permit.

    Bank holidays – The Queen’s Jubilee

    In 2022 there will be an additional Bank Holiday to celebrate the Queen’s Platinum Jubilee. The usual late May bank holiday has been moved to Thursday 2 June to give workers a four-day weekend.

    Whether or not employees are entitled to take this off will depend on the wording of their employment contracts. Employers will need to check the wording and communicate with employees as to whether or not they will be expected to work on the additional bank holiday.

    On a practical level, employers should also be mindful of how they will manage a possible influx of holiday requests for the week commencing 30 May, due to this being a shorter working week.

    Flexible working

    A consultation on flexible working closed in December 2021. It sought responses on proposals to extend the existing right to request flexible working.

    These proposed changes are intended to form part of the Employment Bill was originally announced in the 2019 Queen’s Speech. It has yet to be published but there is speculation it may be published in 2022.

    It is anticipated the changes could include a new right to request flexible working from day one (currently it is not available until 26 weeks continuous employment).

    It has been made reasonably clear from the consultation that there is no intention to introduce a right to work flexibly by default – the changes will likely modify the current right to request.

    The five proposals set out in the consultation included:

    • Making the right to request flexible working a day one right
    • Whether the eight business reasons for refusing a request all remain valid
    • Requiring the employer to suggest alternatives
    • The administrative process underpinning the right to request flexible working
    • Requesting a temporary arrangement

    The proposal to require employers to state in job adverts whether the job is open to flexible working may also form part of the new Employment Bill.

    It remains to be seen how many of these proposals will form part of any new laws and when those laws may arrive.

    Carer’s leave

    In September 2021, the government published its response to a 2020 consultation on Carer’s leave. It has confirmed that it plans to legislate an entitlement to Carer’s leave for employees as a “day one” right.

    It is anticipated that under these proposals, employees will be able to take up to five days’ (one week) unpaid Carer’s leave each year to help them carry out their caring responsibilities. The leave can be taken flexibly (from half a day to one week) and will be for planned care or making arrangements for planned care (not emergencies). It will not replace existing leave for time off for dependents.

    Employees will be required to give notice that is at least twice the length of the time being requested, but there will be stricter refusal grounds for employers – for example if their business will be “unduly disrupted”.

    The person being cared for must have a long term care need, but it is not anticipated that there will be any evidential requirements needed, but further details are awaited.

    Employers will need to be aware of any new leave entitlement and consider whether it will be offering any paid enhancements to the statutory right.

    It remains to be seen how many of these proposals will form part of any new laws and when those laws may arrive.

    Stable contracts

    The Employment Bill is also expected to introduce new rights for workers with variable hours to request a more stable and predictable contract after 26 weeks’ service.

    It is expected that the Bill will also introduce a right for workers to receive reasonable notice of working hours and to be compensated where their shifts are cancelled without reasonable notice.

    The EU transparent and predictable working conditions directive will introduce similar rights on an EU-wide basis in August 2022.

    The further detail of this right and how it would work in practice are awaited, however we are likely to see tougher laws in this area in the coming year.

    Equality laws – third party harassment

    The government has promised to introduce a new pro-active duty on employers to prevent sexual harassment in the workplace. It has also committed to bring back laws making employers responsible if employees are harassed by customers or other third parties. How this will work in practice, however, remains to be seen.

    These are still proposals and provision could be made in the Employment Bill for these changes, although this is currently speculative.

    Whistleblowing – EU Directive

    New enhanced EU whistleblowing rules are due to come into force in 2022. Although as a result of Brexit these will no longer apply to the UK, we believe they may influence best practice here.

    A key feature is the requirement to provide feedback to whistleblowers within certain specified timescales (seven days to acknowledge and no more than three months to report back) as well as requirements to keep strict records of how this has been dealt with.

    This may be something that develops in 2022, although there are no current dates for implementation.

    Neonatal care and redundancy

    The UK government has pledged to introduce a new right to 12 weeks’ paid neonatal leave for parents whose babies spend time in neonatal care units. Although there is no set date as to when this would be introduced, it is expected that this would form part of the Employment Bill as and when that comes into being.

    It is anticipated that the leave would be a day one right. The definitions of “parent” and “neonatal care” are still to be confirmed, as are the notification requirements.

    Pregnant workers – redundancy

    The UK has also committed to improve redundancy protection for pregnant employees and maternity returners by giving them priority for alternative employment opportunities if made redundant. There is currently no set date yet for when these provisions would come into force.

    The proposals include similar protections for parents returning from adoption or shared parental leave.

    The protection is speculated to be extend protections that apply during maternity leave to a period of time (potentially six months) after the maternity leave ends.

    Tips

    The Employment Bill may also introduce the long-awaited tips regulations governing how tips are to be distributed. This is in response to a consultation that closed in 2016.

    The proposals will prohibit any deductions from tips other than taxes and include introducing a Statutory Code of Practice for how employers should distribute tips in a way that is fair and transparent, with a written policy on tips, and a record of how tips have been dealt with.

    Under the changes, employers will be able to distribute tips via a tronc, and a tip must be dealt with no later than the end of the month following the month in which it was paid by the customer. The changes would also include provisions to allow workers to make a request for information relating to an employer’s tipping record.

    Further support

    If you require more detailed employment law guidance on the issues covered in this article, book a free 30-minute consultation with a member of our Employment team today, at a time that suits you.

    This content is correct at time of publication

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