UK Employment Law case updates - April 2017

Latest UK Employment Law case updates - April 2017

1. Explanation for disadvantage no longer required to prove indirect discrimination

2. Out of time: only one extension of time limit possible under Acas conciliation

3. Gig economy still a hot topic as worker status established once again 

Explanation for disadvantage no longer required to prove indirect discrimination

Essop and others v Home Office (UK Border Agency); Naeem v Secretary of State for Justice [2017] UKSC 27 (conjoined cases)

The Supreme Court has revised the legal test for indirect discrimination, holding that a claimant does not need to establish the reason that the treatment in question discriminated against them. The decisions reversed those of the Court of Appeal in two cases, which had stated that a claimant must be able to provide an explanation for their disadvantage in such claims. 

Mr Essop, the lead appellant in his case, had been required to pass a Core Skills Assessment as a pre-requisite to promotion. A Home Office report revealed that black, minority ethnic and older candidates had lower pass rates than white candidates in this test, but the reasons for the differing pass rates were unclear.

Mr Naeem is an imam, who had worked as a prison chaplain since 2001. Before 2002, Muslim chaplains were not engaged on a salaried basis due to lack of demand. The Prison Service pay scheme was related to length of service, which meant all Muslim chaplains received less pay than their Christian counterparts, as they had shorter service.

The Supreme Court considered:

(i) Does the Claimant have to prove the reason for the group disadvantage; and 
(ii) Does the reason for the disadvantage have to be something which is particular to the group's protected characteristic? 

The Court held unanimously that the answer was no to both questions. The crucial element to establish in such matters is causality between the protected characteristic and the disadvantage suffered, both by the individual themselves and the group as a whole.

The judgment delivers a significant simplification on a previously more complex law: in the above cases, each court overruled the decision in the previous stage of the proceedings, demonstrating the ambiguity surrounding indirect discrimination. This ruling returns the law to its previous position, and provides employers with much-needed clarity on the elements which need to be established by an employee in order for them to succeed in a claim of indirect discrimination. 

Out of time: only one extension of time limit possible under Acas conciliation

Commissioners for HM Revenue and Customs v Serra Garau UKEAT/0348/16

The EAT has held that a second early conciliation (EC) certificate issued for the same matter as the first will not extend a claimant's time limit for instituting tribunal proceedings.

In this case, HMRC gave Mr Garau notice of termination of his employment, which was due to expire on 30 December 2015. 

On 12 October 2015, Mr Garau contacted Acas for the first time using the mandatory EC procedure, and Acas issued an EC certificate on 4 November 2015. 

The Claimant contacted Acas again on 28 March 2016. The next day, 29 March 2016, would have been the expiration of the primary three-month limitation period, subject to the implementation of the EC regime. 

A second certificate was issued on 25 April 2016, and Mr Garau issued his claims for unfair dismissal and disability discrimination on 25 May 2016. 

The ET held that the claim was issued on time, as Mr Garau had instituted procedings on the last day of the second period of EC. HMRC duly appealed, arguing that the second certificate was unnecessary and had no effect on the limitation period for Mr Garau's claim.

The EAT agreed with HMRC, and held that only one period of EC is required: provisions relating to extension of time limits apply solely to the first, mandatory certificate. In this case, the first EC period had concluded before the limitation period for his claims had started to run; and a second, voluntary period of EC would have had no impact on the time limits. 

This case provides helpful clarification on the time extension provisions, particularly when the period of EC arises prior to the primary limitation period. 

Gig economy still a hot topic as worker status established once again 

Boxer v Excel Group Services Ltd ET/3200365/2016

The ET has confirmed that a cycle courier was a worker entitled to holiday pay; a decision which follows highly-publicised cases over the last six months involving Uber, Citysprint and Pimlico Plumbers. 

Mr Boxer, a cycle courier, brought a claim against Excel Group Services Limited ("Excel") arguing that his role as a cycle courier was within the definition of a worker under section 230(3)(b) of the Employment Rights Act 1996, and therefore was entitled to receive holiday pay for a period of one week during which he had taken holiday but had not been paid by Excel. 

Finding in favour of Mr Boxer, the ET took into account a number of factors, including the duration of Mr Boxer's work (three years); under whose direction he performed his role; and the Court of Appeal's judgment in Pimlico Plumbers Ltd v Smith [2017] EWCA Civ 51. It held that, inter alia, Mr Boxer's terms of employment as a self-employed contractor did not reflect his day-to-day role; it was clear that he was personally bound to Excel and could not realistically use a substitute courier because the clause governing that right was too restrictive; and the inequality of bargaining power when he signed his contract was notable. As such, the working relationship as a whole was only compatible with his being a worker.

Tribunals are likely to face similar issues in the future, and the spotlight on the gig economy does not appear to be fading. Recent decisions prove the ET's willingness to look beyond the mere employment terms and focus on the reality of the situation at hand; and individuals may take this recent trend of worker status as an opportunity to assert their employment rights. Employers engaging contractors should take proactive steps to ensure that contracts signed by such individuals represent an accurate depiction of the working relationship.