April 2022 - MLP Law

Stress Awareness Month 2022

April is Stress Awareness Month so there has never been a more relevant time to consider work-related stress.
 
The issue of stress in the workplace has always been present and with mental health issues estimated to cost employers about £45 billion every year it is a subject that is perilous to ignore.  Yet, recent cultural changes, including the widespread adoption of working from home and hybrid working, mean that there are many new pressures facing staff, together with all the usual strains imposed by working life.  With all these factors combining to exacerbate employees’ stress levels, how should employer’s manage the potential problems posed by work related stress?
 
What is stress?
The Health and Safety Executive (HSE) defines stress as ‘the adverse reaction people have to excessive pressures or other types of demand placed on them’. Stress is not in itself an illness, but can make individuals ill, for instance by leading to conditions such as anxiety and depression.  Stress, anxiety and depression can also increase the risk of conditions like heart disease, back pain, gastrointestinal illnesses or skin conditions.
 
The impact of stress in the workplace
In general terms, reducing work-related stress can help to:
 
•make staff healthier and happier at work
 
•improve performance and productivity
 
•reduce absence levels
 
•reduce workplace disputes and minimise the risk of employment claims, and
 
•make the organisation more attractive to job seekers
 
Moreover, whilst stress can be debilitating in its own right, in some cases, conditions caused by stress may amount to a disability in a legal sense, affording affected employees protection under discrimination legislation. 
 
Risk assess the workplace
To reduce the impact of stress, it is vital to ensure that your business has systems in place to minimise work-related stress and manage its effects.  The HSE identifies six key areas of work design that, if not properly managed, can lead to work-related stress.  These are:
 
•demands—this includes issues such as workload, work patterns and the work environment; staff can become overloaded if they cannot cope with the amount of work or type of work they are asked to do;
 
•control—how much say the individual has in the way they do their work; staff can feel disaffected and perform poorly if they have no say over how and when they do their work;
 
•support—this includes encouragement, sponsorship and resources provided by the organisation, line management and colleagues; levels of sickness absence often rise if staff feel they cannot talk to managers about issues troubling them;
 
•relationships—this includes promoting positive working to avoid conflict and dealing with unacceptable behaviour; a failure to build relationships based on good behaviour and trust can lead to problems related to discipline, grievances and bullying;
 
•role—whether people understand their role within the organisation and whether the organisation ensures that they do not have conflicting roles; staff will feel anxious about their work and the organisation if they do not know what is expected of them and/or understand how their work fits into the objectives of the organisation; and
 
•change—how organisational change (large and small) is managed and communicated in the organisation; change needs to be managed effectively or it can lead to huge uncertainty and insecurity.
 
Employers should therefore first assess the risks in these areas, in order to effectively manage stress in the workplace.
 
Take action
To confront the challenges posed by work-related stress, HSE has launched its Working Minds campaign, with specific advice based on 5 simple steps:
 
1.       reach out and have conversations about stress e.g. arrange an employee led working task force to arrange appropriate events
2.       recognise the signs of stress e.g. irritability
3.       respond to any risks identified e.g. have mental health advocates and appropriate management training
4.       reflect on what’s happened
5.       make it routine
 
This approach can help employers recognise and respond to issues early, before they escalate.
 
Ultimately, opening up a dialogue about stress in the workplace – especially effective if senior members of staff participate – can be the first step to tackling and reducing work-related stress.  It is also vital to have effective policies in place, which give employees who are feeling stressed appropriate channels to communicate their concerns and receive help.
 
Employers who can point to effective systems, targeted at reducing work-related stress, can help to minimise the risk of litigation, reduce employee absence and generally improve the sense of well-being and morale in the workplace.
 
If you would like advice from the Employment team at MLP Law in respect of any of the issues raised here or more generally, please do not hesitate to get in touch on 0161 926 9969 or employment@mlplaw.co.uk, or follow us on Twitter @HRHeroUK.

Unfair Dismissal and Voluntary Redundancy

Unfair Dismissal and Voluntary Redundancy
 
Employers could be forgiven for thinking that when an employee requests voluntary redundancy during a redundancy exercise, they will be protected from claims of unfair dismissal from those volunteers.  Not so, says the Employment Appeal Tribunal in a recent decision on the subject.  Julie Sabba analyses the implications of the recent case of White v HC-One Oval Limited [2022].
 
Facts
The claimant was employed by the respondent, on a part-time basis, as a receptionist at a care home in East Sussex. In 2018 the respondent announced its proposal to reduce the number of employees carrying out receptionist and administrative work in a number of its care homes, including the home in which the claimant worked.  The claimant was provisionally selected for redundancy.
 
The respondent states that the claimant then requested voluntary redundancy, which was agreed, leading to her termination of employment.  The claimant, however, states that she only requested voluntary redundancy in the context of unfair circumstances, which included the fact that she had raised concerns about her pay in a grievance and that she believed that another, newly appointed full-time, receptionist had been brought in to replace her.
 
Law
Although a voluntary redundancy may look like a consensual termination, an employee who volunteers for redundancy is routinely to be regarded as dismissed.
 
In practice the dividing line between what is essentially an invited dismissal as opposed to the mutual agreement to end the employment contract may be very fine.  Indeed, it can be argued that the reality of a voluntary redundancy is that the employee is simply agreeing not to object to the redundancy dismissal by the employer.  It can certainly be submitted that an employee is not really freely choosing to end the employment relationship, in such circumstances.
 
Decision
The Employment Tribunal struck out the claimant’s claim of unfair dismissal, citing the fact that she had volunteered to be dismissed for redundancy but, on appeal, the Judge allowed the claim to go ahead and be considered in full by another employment tribunal.
 
Some of the key reasons for allowing the claim to be considered in full (aside from the fact that both parties disagreed over the factual history of the case) included the observation that an employee’s complaints about the process that led them to make the request to volunteer are relevant issues to be considered as part of a claim for unfair dismissal.  This means that even if an employee volunteers for redundancy, an employment tribunal can still examine various factors, including whether there was a potentially fair reason for dismissal (eg whether the dismissal was genuinely for redundancy or for another reason) and the fairness of the dismissal generally (eg whether the correct people were included in the pool for selection).
 
Comment
What this decision demonstrates is that employers are not immune from a claim of unfair dismissal just because an employee accepts voluntary redundancy.  This is because an employee who volunteers for redundancy is routinely to be regarded as dismissed.  Moreover, the events and management process which precede the request for voluntary redundancy may be relevant to the decision maker’s reasons for dismissing the employee and the fairness of the process as a whole.
 
The appeal decision therefore underlines that it is a fallacy to believe that an employee who makes a request for voluntary redundancy is unable to complain about any of the events that preceded and led to that request, as part of their unfair dismissal claim.
 
Employers and those advising them should therefore ensure proper redundancy consultation and selection processes are followed.  Furthermore, as it is common to enhance the redundancy payment to encourage volunteers, it will be advisable to consider making the arrangement part of a settlement agreement which at the same time compromises any potential claims the employee may have against the employer.
 
If you would like advice from the Employment team at MLP Law in respect of any of the issues raised here or more generally, please do not hesitate to get in touch on 0161 926 9969 or employment@mlplaw.co.uk, or follow us on Twitter @HRHeroUK.

Everything you ever wanted to know about Redundancies, but were too afraid to ask

To help you make sure you get it right when faced with a redundancy situation, we’ve set out some key things which employers should always bear in mind when thinking about redundancies.
 
Is there a redundancy situation within my business?
 
Generally, redundancy situations arise out of a reduced need for employees, normally where:
 
• a business (or a part of it) is closing or operations are ceasing at a particular location;
• improved processes in the business have reduced the need for employees; or
• the current employment structure is not financially sustainable (i.e. you’re overstaffed).
 
Concerns about an employee’s performance or conduct should not be treated as a redundancy and should instead be dealt with under a performance management process or as disciplinary proceedings, as appropriate. Employers should avoid the temptation to manufacture a redundancy scenario in order to deal with other issues – the reality of the situation is bound to come out eventually and would reflect badly on a business which is trying to justify its actions in an Employment Tribunal.
 
If there is a redundancy situation, what are my legal obligations?
 
Businesses who feel they may be facing a redundancy situation are required to adequately warn and consult with employees about the risk of redundancies before making any final decisions about making roles redundant. This typically involves a series of redundancy consultation meetings with the employees who are at risk of redundancy, during which the redundancy proposals and the reasons for them are discussed.
 
Employers are also required to identify an appropriate pool of employees from which those who will be made redundant are to be selected and objective and measurable selection criteria should be used to identify the employees within the redundancy pool who are to be made redundant.
 
This is often the stage that employers are tempted to rush. Don’t. The management time and expense to the business that can be saved further down the line simply by taking the time to go through a thorough consultation process is more than worth it.
 
Who is affected by the possible redundancies?
 
Before selecting an employee for dismissal on the grounds of redundancy, the business must consider from which pool of employees’ redundancy selection should be made otherwise the dismissal is likely to be unfair.
There are no fixed rules about how a redundancy pool should be defined. As long as the business can show that its choice of pool was reasonable in the circumstances, it will be difficult for an employee (or an employment tribunal) to challenge the decision.
 
When considering the choice of pool, businesses should start by asking two questions:
 
• which particular kind of work is disappearing?
• which employees do the particular kind of work that is disappearing?
 
If there is a clear link between the kind of work that is disappearing and the group of employees doing that work, then the pool will be easy to identify.
 
What if my employees are multi-skilled or have interchangeable skills?
 
Identifying the pool becomes more complicated if the business’ employees are multi-skilled and do different types of work, as the employees are likely to argue that other employees with whom they share interchangeable skills should be at risk of redundancy too. It may be unreasonable for the business to ignore these arguments, unless it can justify the clear business reasons for doing so.
 
This is more likely to be an issue for “low-skilled” work, where it is more likely the skills would be regarded as interchangeable.
 
Ideally, businesses should make the redundancy pool no wider than necessary in order to limit the impact that a wide redundancy pool could have on the morale of the business’s employees. However, employers will need to balance this against the risk of being found to have used an unreasonably narrow pool.
 
What is “bumping” and do I have to do it?
 
A business is entitled to widen the selection criteria for redundancy beyond those employees that are directly affected by the redundancy situation. The business can consider “bumping” out of their jobs employees whose roles are not redundant, to be filled by employees whose roles are redundant – for instance, ‘bumping’ the receptionist to allow a secretary to fill that position, when the business is reducing the number of secretaries.
 
There is no obligation on a business to consider “bumping”, but the business may fall foul of unfair dismissal law if it would have been reasonable to consider it in the circumstances.
 
If I am reducing numbers but retaining some roles, how do I choose between employees?
 
To decide which employees should be selected for redundancy, employers should use objective and measurable selection criteria to score the at risk employees and should apply these criteria fairly. The criteria should not simply be based on someone’s subjective opinion. Potentially fair selection criteria include disciplinary records, absence records and performance. Employees’ scores should also be discussed with them as part of the consultation process.
 
Where performance is used as a criterion, the employer should refer to written records, such as performance appraisals, rather than relying on a manager’s personal opinion. It will be difficult for the employee to challenge the employer’s reliance on appraisals, particularly where they have agreed with comments made in the appraisal. In some jobs, such as those involving sales or productivity targets, performance is inherently easy to measure.
 
Where attendance is used as a criterion, consideration should be given to whether any particular periods of absence should be discounted, such as absence for pregnancy-related illness, maternity or other family-friendly leave should be discounted, as should any disability related absence.
 
It goes without saying that employers should not use selection criteria that discriminate directly on grounds of sex (including pregnancy), fixed-term or part-time status, race, disability, sexual orientation, religion or belief will generally result in a finding that a dismissal is unfair (in addition to a finding of unlawful discrimination). Criteria that have an indirectly discriminatory effect are also likely to render dismissals unfair if the employer is unable to demonstrate an objective justification for the adoption of such criteria.
 
How much consideration do I need to give to avoid making redundancies?
 
Employers are under an obligation to consider how redundancies can be avoided or, if this is not possible, how the number of redundancies can be minimised. Possible options include suspending or restricting recruitment, reducing or removing overtime opportunities or temporarily laying off employees. More permanent solutions might be reductions in pay or hours.
 
Employers should also identify whether any suitable alternative roles are available within the business which could be offered to the affected employees as an alternative. It is good practice to make the employees aware of all vacancies, even if they do not immediately appear to be relevant to the employee’s current role. This means that the employees are given all of the options and can then decide not to apply for vacant roles if they don’t wish to.
 
Do I have to find new jobs for the affected employees?
 
A business is not obliged to create alternative employment for redundant employees where none already exists. However, the business should make a thorough search for alternative employment and document that search. This will enable the business to show the steps it has taken if it has to produce evidence in defence of an unfair dismissal claim. Businesses should continue to search for possible alternative employment until the date the employee’s dismissal takes effect.
 
Can I ask for volunteers for redundancy?
 
Yes, you may wish to request volunteers – you do not need to agree to every positive response from employees, which means that you can refuse a proposal to volunteer for redundancy from employees that you wish to keep in the business. Remember, however, an individual who agrees to accept voluntary redundancy can still submit a claim for unfair dismissal if the reasons behind the redundancy are not valid or the process is flawed.
 
What payments are redundant employees entitled to?
 
Employees with sufficient continuous service who are made redundant are entitled to receive a Statutory Redundancy Payment, which is calculated by reference the employee’s age, weekly wage and length of service. This payment is tax free.
 
All employees are entitled to receive notice of the termination of their employment, which will be the period set out in their contracts of employment or a minimum of 1 week per complete year of employment, whichever is greater. Employees are also entitled to receive a payment in lieu of any accrued but untaken holidays. Both of these payments are subject to PAYE deductions in the normal way.
 
What are the consequences if I get things wrong?
 
Employees with sufficient continuous service have the right not to be unfairly dismissed. Any employees who are made redundant in scenarios which do not constitute redundancy situations or following an unfair redundancy process will be able to bring a claim of unfair dismissal against their employer. As mentioned above, a redundancy process may be considered unfair if there is inadequate consultation, if the redundancy pool is inappropriate, if the selection criteria used are not fair and measurable or if there is insufficient consideration of alternatives to redundancy.
 
A successful claim for unfair dismissal can result in the employee being awarded up to a year’s gross salary as compensation for loss of earnings.
 
In such circumstances, you may wish to consider entering into a settlement agreement, especially if you are providing an enhanced redundancy payment.
 
This guide is intended as an aid to employers who are considering the requirements they may need to meet in a redundancy situation. However, each redundancy situation is different so if you have any questions or queries about the points set out above or about redundancies generally, please get in touch with the Employment team at MLP Law in respect of any of the issues raised here or more generally, please do not hesitate to get in touch on 0161 926 9969 or employment@mlplaw.co.uk, or follow us on Twitter @HRHeroUK.

Injury to Feelings Compensation in Discrimination Claims

In cases where a claimant is successful in proving that they have been discriminated against, in contravention of the Equality Act 2010, an Employment Tribunal Judge will award compensation.  The compensation can encompass various elements, including losses of earnings and compensation for injured feelings.  Given the recent increase regarding the amount of compensation to be awarded in respect of injured feelings (outlined below), Julie Sabba, an Associate in the MLP Law Employment Team, explains this type of compensation in more detail.
 
The purpose of the award for injury to feelings
Awards for injury to feelings are designed to compensate victims for the hurt caused by being treated in a way that contravenes the Equality Act 2010.  The level of hurt suffered is therefore directly linked to the amount of compensation that the employee will receive.  This means that, for example, a finding that an employee would have been fairly dismissed a few months later anyway (which could reduce the compensation awarded for loss of earnings) would not affect the hurt caused by the discrimination and, therefore, the amount awarded for injury to feelings.
 
Furthermore, the Tribunal Judge should be entirely focused on the effect the conduct has had on the employee, meaning that the level of an award for injury to feelings should not be affected by a desire to punish the discriminator nor should it be used as a means of deterring employers from particular courses of conduct.
 
The size of the award
Awards for injury to feelings are split into levels which are dependent on the seriousness of the case.  These bands are called Vento bands, after the case where the approach was first used.
 
The updated amounts, for claims presented on or after 6 April 2022, outlines that the Vento bands will be:
 
• £990 to £9,900 for the lower band—less serious cases
 
• £9,900 to £29,600 for the middle band
 
• £29,600 to £49,300 for the upper band—the most serious cases
 
• £49,300 and above for the most exceptional cases
 
Factors that can increase the award
Events happening after the original discriminatory acts may increase the size of the injury to feelings award, for example if they were a consequence of the initial discrimination, even if they did not involve any discriminatory conduct in themselves.  For instance, where, after being subjected to racially derogatory remarks, an individual was:
 
•put through a disciplinary process;
 
•moved to a different job location; and
 
•had to wait a long time for their grievance to be resolved;
 
the injury to feelings award for the original remarks was adjusted to take account of the subsequent actions that caused the employee distress, even though they did not amount to discriminatory conduct in themselves.
 
Primary consideration is the effect on the claimant
In assessing an injury to feelings award the primary consideration is the effect the conduct has on the individual claimant, not just whether it was a one-off act or continuing course of conduct. As such:
 
•a serious single act of discrimination or prohibited conduct, e.g. a dismissal, may in certain circumstances warrant an award for injury to feelings in the middle or upper Vento bands; and
 
•there may be cases involving a continuing course of conduct that are properly to be assessed as falling within the lower Vento band.
 
Moreover, the impact of conduct on a particular individual has to be considered from the claimant’s point of view.  So, if a claimant describes being incredibly upset by certain comments, which may have had less of an impact on others, it is not for the Judge to minimise the effect it has had on that individual.
 
Advice for employers
Given the sizeable sums which may be involved in successful claims of discrimination, it is essential to ensure that your business has robust equality policies, which are supported by relevant training to staff and managers.  This will help to defend any discrimination claim in the first instance and can help to reduce the size of any award.
 
If you would like advice from the Employment Team at MLP Law in respect of any of the issues raised here or more generally, please do not hesitate to get in touch on 0161 926 9969 or employment@mlplaw.co.uk, or follow us on Twitter @HRHeroUK