Employment Review – October 2017

This month we consider the changing trends and patterns in workplace practices, as revealed by a number of key pieces of research. We also take a look at the most recent case concerning the rights of workers in the so-called ‘gig economy’.

In addition, an interesting European case is worth a closer look as it potentially builds on the existing rights of pregnant workers, and those on maternity leave. Finally – we check in on the ongoing ASDA Equal Pay litigation, which thus far is going in the favour of the claimants.

• Ear to the ground – research reveals trends and changes in employment practices
• Addison Lee drivers – workers, not self-employed
• Pregnancy and maternity discrimination – a potential increase in protection
• ASDA – EAT upheld Equal Pay comparison

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Ear to the ground – research reveals trends and changes in employment practices

Research by various bodies has shone a light on employment law in practice:

• Zero-hours Contracts: The Office of National Statistics (ONS) has published data showing that the number of workers on zero hours contracts has fallen by 300,000 over the last year to the lowest level recorded in over three years. 6% of business makes use of zero-hours contracts, with administrative and support services being the most prominent users.
• National Minimum Wage: The Low Pay Commission (LPC) believes that as many as 1 in 5 minimum wage workers could be receiving less than they are entitled to. A recent report showed that, at its peak in the year, between 305,000 and 580,000 workers were underpaid. The report estimated that, as the National Living Wage rises, HMRC will be responsible for monitoring 3.3 million workers by 2020, a rise from the 2.3 million currently recorded.
• Shared Parental Leave: Research has revealed that only 8,700 new parents made use of the shared parental leave system in the last year, accounting for less than 1% of those that were eligible. Researchers suggest the low uptake may result from a “cultural stigma” attaching to men who decided to take time off work to care for their children and their concern about the impact a lengthy period off work might have on their careers. Other factors may include financial implications of using the scheme and a general lack of awareness or understanding of the entitlement.
• Bonuses: The ONS has published data showing that UK bonus payments have risen to the greatest on record. The total number of UK bonuses paid in the latest financial year amounted to £46.4 billion, a 6.5% increase compared to the previous year. The insurance and financial sectors paid the highest bonuses on average. In contrast, the health and social sectors paid the lowest in bonuses to its employees, with average bonuses amounting to almost zero.
• Apprenticeships: Apprenticeships are growing at a faster rate than graduate roles a new survey has revealed this week. According to the survey undertaken by the Institute of Student Employers (ISE) there was a 19% increase in the number of apprentices hired in 2016/17 compared to the previous year.

Addison Lee drivers – workers, not self-employed

A tribunal has ruled that three drivers from minicab firm, Addison Lee, should have been treated as workers and not self-employed – meaning they will be entitled to the national minimum wage, holiday and arrears of pay. Addison Lee claimed that each driver was running a small business in of itself despite significant evidence pointing away from a self-employment arrangement including:

• A dress code and code of conduct
• Each trip requiring the consent of a central control base
• An obligation to accept fares from the company’s booking system
• Fixed cost of hiring company levied vehicles

The tribunal did not accept Addison Lee’s argument and ruled that the drivers were in a subordinate position to the company, as opposed to contracting with it.

There are a number of cases in which worker rights for those in the so-called ‘gig economy’ are to be considered including Uber later this month and delivery companies Hermes and DX early next year.

Pregnancy and maternity discrimination – a potential increase in protection

In the European case of Porras Guisado v Bankia SA the Advocate General considered a case in which a pregnant employee was selected for redundancy in a collective redundancy situation. She was made redundant and the employer claimed not to have known of the employee’s pregnancy. The law states that employers should prevent pregnant workers (and those on maternity leave) from being dismissed, save in exceptional cases.

The employer argued the redundancy situation was an “exceptional case”. The Advocate General provided her opinion, summarised here:

• The period of protection starts at the beginning of pregnancy and continues until the end of maternity leave. This is the case even if the employer does not know that the worker is pregnant.
• What amounts to an “exceptional case” will be determined on the facts of the case and construed narrowly. A collective redundancy situation is not automatically an “exceptional”.
• An employer must give a dismissed worker an explanation of why the collective redundancy in question is an “exceptional case” if she is pregnant or on maternity leave at the time of the dismissal.
• An employer cannot dismiss a pregnant worker/ worker on maternity leave if she can “plausibly be reassigned” to another suitable work post.

Presently in UK law an employer can select a pregnant employee or a woman on maternity leave for redundancy provided that the selection is non-discriminatory. Employees selected for redundancy while on maternity leave (but not while pregnant) have a priority right to redeployment. In addition the general view is that a woman has no special protection until her employer is made aware of her pregnancy. If the Court of Justice and European Rights follows the AG’s opinion, that position may have to be revisited.

ASDA – EAT upheld Equal Pay comparison

In Asda Stores Ltd v Brierley and others UKEAT/0011/17, the EAT considered whether a group of predominantly female retail store employees could compare themselves to a group of mainly male distribution depot employees for the purposes of an equal pay claim.

This case concerns around 7,000 claimants working in the retail division of ASDA and has potentially significant implications for the retail sector. The claimants assert that they do work of equal value with workers in ASDA’s distribution division, who are predominantly male. ASDA argued that because of difference between the work areas (location, pay arrangements) the claimants could not use the depot employees are comparators. This argument was rejected by the tribunal who found there were common terms and conditions across the different locations so the claims could proceed. ASDA appealed this decision but the EAT rejected the appeal.

The claimants must still show they carry out work of equal value to their males comparators in the distribution centres. If they succeed in that argument then ASDA will then have the opportunity to show that it has a “material factor defence” which could justify the pay disparity.

The Employment Appeal Tribunal has given ASDA permission to appeal this decision to the Court of Appeal.

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The content of this page is a summary of the law in force at the date of publication and is not exhaustive, nor does it contain definitive advice. Specialist legal advice should be sought in relation to any queries that may arise.