EMPLOYMENT LAW TRAINING AND EMPLOYMENT LAW CONSULTANCY

Section Two
 

The Law in More Detail

Article One: Temporary Workers Directive

Article Two: The Equalities Bill

Item One Temporary Workers Directive - New rights for agency workers

Overview. The Government has been under pressure for some years, both at home and in Europe, to improve the rights of temporary agency workers. Progress was finally made when, on 5 December last year, the Directive on temporary agency work was published by the European Union. Member States now have until 5th December 2011 to implement its provisions, which give agency workers certain rights equal to those of comparable permanent staff from day one of employment.

However, this will not confer employee status (or the right to claim unfair dismissal) on agency workers.

Although the Directive talks of rights from day one, in the United Kingdom most of the rights will not apply until after 12 weeks of employment.

In any event, employers should start thinking now about their use of agency workers in preparation for the forthcoming changes - for example, they may want to consider using fewer agency staff or restrict assignments to less than 12 weeks or reorganise working patterns to make the most of permanent staff - for example, by using annualised hours.
The Government announced in October 2009 that this will not come into effect in the UK until October 2011 - almost the latest possible introduction date to comply with EC regulations.

Background and detailed review.

The rights of agency workers have been one of the hot topics in employment law over the last decade. Trade unions have campaigned for some time for such workers to be granted the same rights as employees, while in recent years there has been a line of cases reviewing the employment status of individuals supplied by an employment business to a hirer/end-user.

The Government, in February 2008, set up an independent commission to consider the rights of temporary and agency workers. The outcome was that the Government, the CBI and the TUC issued a joint statement on 20 May 2008 agreeing to legislate to give agency workers the right to terms and conditions of employment comparable to those enjoyed by their permanent counterparts.

As a result of the CBI/TUC agreement, the Government dropped its opposition to longstanding proposals for EC legislation to protect the rights of temporary agency workers. Thus, in October 2008 the European Parliament passed the EC Temporary Agency Workers Directive, which Member States have until 5 December 2011 to transpose into national law.

The first thing that must be said about the Directive is that it does not affect the employment status of agency workers, and so cannot be a means through which such workers gain rights that are dependent on being an employee, such as the right not to be unfairly dismissed. Instead, it provides for a principle of 'equal treatment' in respect of 'basic working and employment conditions', similar in some ways to the existing rights for part-time workers and fixed-term employees.

Who will be covered?

The Business, Innovation and Skills (BIS) Department has adopted the term 'temporary work agency' from the Directive. This is defined as a person or group of people engaged in one of two economic activities: supplying persons to work for and under the direction of a hirer; or paying for, or receiving or forwarding payment for, the services of such persons.

Agency worker

In the original consultation, BIS suggested that the Regulations should adopt the definition of 'worker' used in the Working Time Regulations, with some modifications to reflect the triangular relationship under which agency workers operate. Despite calls from the TUC for a novel definition of 'agency worker', BIS has opted to stick with its original proposal. As a result, an 'agency worker' is defined as an individual who is supplied by a temporary work agency to work for and under the direction of a hirer; is employed or otherwise engaged by the agency; and is not a party to a contract under which the individual undertakes to do work for another party to the contract, whose status is, by virtue of that contract, that of a client or customer of any profession or business undertaking carried on by the individual.

Equal treatment

The Directive seeks to improve the rights of agency workers through the provision of a right to 'equal treatment'. This provides that an agency worker is entitled to the same 'basic working and employment conditions' as if he or she had been recruited directly.

These basic working and employment conditions are defined as: pay; the duration of working time; the length of night work; rest periods; rest breaks; and annual leave.

A right to equal treatment necessarily involves a comparison, and the nature of the comparison that will be required by the Agency Workers Regulations is contentious. The Regulations allow an agency worker to assert a right to equal treatment by pointing to a 'flesh and blood' comparator, i.e. a 'comparable employee' doing the same or broadly similar work. In most instances, identifying a comparable employee will be the least problematic method of establishing a case.

Annual leave

Due to the decision to adopt a modified version of the definition of worker found in the Working Time Regulations, it follows that anyone who satisfies the definition of agency worker in the new Regulations would already be entitled to the statutory minimum of 5.6 weeks' paid annual leave, along with minimum entitlements to rest breaks.

Meaning of pay

Although the CBI and the TUC reached agreement in 2008 on the basic terms for implementing the Directive into UK law, the two bodies disagree on the question of what should amount to 'pay' for the purposes of the Regulations. The CBI and other employers' bodies have called for pay to be limited to the basic hourly wage, while the TUC wants a much wider definition that encompasses things such as redundancy payments and adoption, maternity and paternity pay.

Meanwhile, excluded payments and rewards are: occupational sick pay; pensions, allowances and gratuities paid out in connection with retirement or loss of office; maternity, paternity and adoption pay; redundancy payments; profit sharing schemes; share option schemes; bonuses awarded through a performance appraisal pay system aimed at the long-term management, motivation and retention of staff; payments for statutory time off, such as for carrying out trade union duties; guarantee pay; advances and employee loans; expenses; and any payments that fall outside the employment relationship.
The most likely area for dispute over the definition of pay is bonuses, since some will be covered and some will not.

Qualifying period

As mentioned above, the implementation of the Directive in the United Kingdom will be along the lines of the CBI/TUC agreement, meaning that, rather than being entitled to equality in respect of basic working and employment conditions from the first day of an assignment, an agency worker would instead have to work on that assignment for 12 weeks before becoming entitled to equal treatment.
Regulations provide that, to complete the qualifying period, the agency worker must: (a) undertake the same role with the same hirer for 12 continuous calendar weeks; and (b) be engaged on one or more assignments. A week will count as a calendar week if the worker is engaged for any part of it. So, an agency worker who is working two days each week will qualify for equal treatment in the same time as a worker who is working five days each week.

Breaks in assignments - the "linking" rules

Another means of avoiding the effect of the Regulations would be to 'break' an assignment before an agency worker reaches the end of the qualifying period, or indeed after a worker has qualified for equal treatment, thus requiring him or her to start the qualification process afresh.
To counter that means of avoidance, the Regulations include 'continuity' provisions, the effect of which is to allow weeks accrued in respect of the qualifying period to carry over when the agency worker takes a break for one of a series of specified reasons, before returning to work for the same hirer. Regulations list the following specified reasons: a break for any reason where the break is not more than six calendar weeks (unless the worker is re-engaged on "substantially different work".); the fact that the worker is unable to perform the assignment due to sickness or injury; a break related to pregnancy, childbirth or maternity during the 'protected period'; maternity, adoption and paternity leave; statutory or contractual time-off or leave; and jury service. The breaks in respect of sickness, injury and jury service must be less than 28 calendar weeks.

Agency Workers will have some 'Day one' rights

Some rights under the Regulations would not be subject to the 12-week qualifying period: agency workers would enjoy rights in relation to access to employment and collective facilities from the first day of any assignment. In terms of collective facilities, an agency worker has the right to be treated no less favourably than a comparable employee in relation to access to canteen or similar facilities, access to child care facilities and the provision of transport services. Employers will, however, note that, unlike the other rights in the Regulations, they will be able to treat agency workers less favourably in respect of these rights, where they can demonstrate objective grounds for doing so.

Another 'day one' right is that, during the course of an assignment, an agency worker has the right to be informed of any vacant posts with the hirer, in order to give that worker the same opportunity as a comparable employee to find permanent employment, whether by way of an internal or an external selection process. The hirer need not personally inform the agency worker of any vacancies, as Regulation allows for a 'general announcement in a suitable place in the hirer's establishment'.

Health and Safety duties are already owed to Agency workers from the first day of employment.

Maternity rights

The provisions on pregnancy and maternity discrimination in the Sex Discrimination Act 1975 already apply to a broad category of 'worker', so no changes are required there. However, the consultation does propose extending to agency workers existing employment protections which apply where there is a risk to the health of a pregnant woman, new mother or child.

Liability/Compliance

It will be the Agency that has the responsibility for complying with these Regulations - which means of course that they will have to obtain the necessary employment information on comparable employees who work for the "Hirer". If the Hirer fails to provide the required information, liability for any breach is likely to move to the hiring employer.

 

Article Two: The Equality Bill

The Equality Bill is currently going through the final stages in Parliament before receiving Royal Assent, probably in April 2010. The Government envisages that most of the Bill will come into force in October 2010, with some parts being delayed until spring 2011 and beyond. This, of course, is subject to any changes following the General Election.

In summary, the Equality Bill seeks to harmonise existing discrimination legislation, currently spread across a number of Acts of Parliament and Statutory Instruments, and interpreted by courts and employment tribunals into one piece of legislation. It also strengthens the protection provided by discrimination law as well as tackling the causes of unfairness by introducing the first legal duty on public authorities to deal with 'class' inequality.

The Bill also covers such areas as discrimination in the provision of goods and services; public procurement; discrimination in private members' club rules; and introduces protection for mothers' breastfeeding in public. However, for the purposes of this article, we have focused on the main changes proposed in respect of employment law.

The Main Employment Law Changes

Definitions - The Bill attempts to harmonise the definition of discrimination and harassment starting with setting out the 'protected characteristics' (ie. the grounds on which discrimination will be deemed unlawful) and their meanings. The protected characteristics, as we currently know them, are; age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation.
On the whole, these definitions replicate those currently in force, with one noteworthy change to the protection from transgender discrimination. The proposed definition extends to those who propose to undergo, are undergoing or have undergone a gender reassignment process, whether or not the process involves medical supervision. The Sex Discrimination Act 1975 only covers gender reassignment under medical supervision which means that, for example, a man who chooses to present as a woman, but does not seek medical advice or undergo surgery will be protected from discrimination.
The various kinds of discrimination are then defined by reference to these protected characteristics and although these definitions generally remain the same, there are differences in wording capable of widening the scope of discrimination protection:

Direct Discrimination - Defined in the Bill as 'less favourable treatment because of a protected characteristic', replacing the 'on grounds of' found in current legislation. This broader wording means that so called 'associative discrimination' is covered (whereby an employee suffers discrimination by association with one of the protected characteristics, eg, if they care for an elderly relative). The Bill also makes it clear that this wider definition encompasses the so called 'perceptive discrimination' (because of a person's perceived characteristics, eg, of a certain age group or is gay). These claims would not be possible under some of the existing legislation.
Indirect Discrimination - The Bill adopts the standard definition (albeit worded more clearly); being when a provision, criterion or practice (PCP), which is applied to others, puts those having a particular protected characteristic at a particular disadvantage and that PCP is not a proportionate means of achieving a legitimate aim.

Harassment - The wide approach taken with regard to direct discrimination has also been adopted with regard to harassment. The Bill adopts the focus on unwanted conduct having the purpose or effect of violating the complainant's dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment for him or her. A tribunal hearing a harassment claim must take into account the complainant's perception of the conduct, and whether it is reasonable for it to have the effect complained of. Such conduct must be 'related to a relevant protected characteristic'.
Under the Bill, an employer may be held liable for harassment of an employee by a third party, such as a customer or contractor. Such liability only arises if harassment has occurred on at least two other occasions and the employer has failed to take reasonably practicable steps to stop it. The Bill extends such liability to all the protected characteristics covered by the harassment provisions.
The Bill also extends protection against racial harassment to conduct related to colour or nationality as well as race or ethnic or national origins.

Victimisation - The victimisation provisions in the Bill take a slightly different approach to that set down in current legislation. Currently, in order for a claimant to prove victimisation, he or she must show that the employer has treated him or her less favourably than he treats or would treat other persons in the same circumstances and did so by reason that the claimant has done or intends to do a protected act. Under the Bill the claimant will have to show that he or she has been subjected to a detriment because he or she has done or intends to do a protected act. The Bill, therefore, removes the absolute need for the tribunal to construct an appropriate comparator, although this will still be an effective way of establishing the reason for treatment. If the claimant can show detriment then the tribunal can move straight on to considering the reason for it.

Multiple Discrimination - The Bill protects people who experience discrimination of two protected characteristics, such as black women or religious men. This would mean, for example, that a black woman who is discriminated against because her employer has particular stereotyped attitudes towards black women as opposed to black men or white women, could bring a single claim for combined race and sex discrimination. Currently, discrimination claims can only be brought in respect of a single protected characteristic.

Disability - There are some changes to the definition of direct and indirect discrimination in this area, but the definition of disability and the existing guidance on determining whether a claimant has a disability have not significantly changed. However, the Government has opted not to retain the requirement that, for an impairment to be considered to affect a person's ability to carry out normal day-to-day activities, it must affect one of eight specified functions (eg, mobility, manual dexterity, memory or ability to learn, concentrate or understand etc.), thus reversing the Malcolm v London Borough of Lewisham case.

The 'Duty to Make Adjustments' comprises three requirements. The first two replicate the current legislation where a provision, criterion or physical feature of premises puts a disabled person at a substantial disadvantage in relation to a relevant matter in comparison with persons who are not disabled, and the person to whom the duty applies must take such steps as it is reasonable to have to take to avoid it. The third requirement extends to employment and makes it clear that where, but for the provision of an auxiliary aid or service, a disabled person would be at a substantial disadvantage, the duty is to take such steps as it is reasonable to have to take to provide that aid or service. The amendment to the Bill makes it explicit that a reasonable adjustment includes steps to provide information in accessible formats, when the way information is provided would otherwise put disabled people at a substantial disadvantage.

The Bill was recently amended to make it unlawful to ask job applicants questions related to disability and health except in prescribed circumstances, thus giving the Equality and Human Rights Commission an enforcement role.

Equal Pay - The basic principles remain the same, but with some minor amendments:

The Bill does not introduce the use of hypothetical comparators in equal pay claims. However, it does allow claims to be brought where a person can show evidence of direct sex discrimination in relation to contractual pay, but is unable to rely on a sex equality clause due to the absence of a comparator doing equal work. The Bill goes on to make it clear that a person bringing an equal pay claim can base it on a comparison with someone who previously did their job, as well as with others currently doing similar work.

Secrecy clauses in contracts of employment, which seek to prevent employees discussing their pay with colleagues (or former colleagues) or with trade union representatives with a view to finding out if there is a connection between pay and having (or not having) a protected characteristic, will be rendered unenforceable. Action taken against an employee for seeking to obtain this information, such as disciplinary action, will amount to victimisation.
With regard to the private sector the Bill contains a new power to make regulations requiring employers with 250 or more employees to publish information about the difference in pay between their male and female employees. Employers who do not comply could face civil enforcement procedures or be liable for a criminal offence with a fine of up to £5,000. The Government, however, intend to take the voluntary approach initially until at least 2013.

With regard to the public sector the Bill contains powers for Ministers to require public bodies to report on equality issues. The Government anticipates that public bodies with more than 150 employees will be required to publish annual details of their gender pay gap, in addition to details of their ethnic minority and disability employment rate. It is expected that the power will be exercised by April 2011.

Recruitment and Promotion

The Bill allows positive action in respect of recruitment and promotion. Positive action will only be allowed where candidates for a job are equally qualified, and does not allow the employer to make decisions using quotas or to have an automatic policy of favouring those from under-represented groups.
Individuals cannot challenge employers for not taking positive action because the provision does not require employers to take positive action. However, if a person wanted to challenge someone's decision to take positive action, the individual would need to establish that the decision-maker positively discriminated and, therefore, went further than is permitted in the Bill.

Enforcement, Remedies and Burden of Proof

The provisions on enforcing claims in employment tribunals are essentially the same as those in current legislation. However, there is a significant proposed change to the power to order recommendations. Currently employment tribunals can make a recommendation aimed at reducing the negative impact of the respondent's actions on the individual claimant. However, this may no longer be relevant to the individual claimant, probably because they will have already left the employer, and does not help to prevent similar types of discrimination occurring in the future. Accordingly, the Bill proposes to extend this power to allow employment tribunals to make recommendations aimed at reducing the negative impact on the wider workforce.

The provisions on the burden of proof are to be harmonised in that it shifts to the respondent to show that he or she did not breach the provisions of the Bill. This is once the claimant has established a prima facie case establishing sufficient facts to point to a breach having occurred in the absence of any other explanation.

This article has been written by ELT Associate:
Kate Goschen
HR Remedies
Providing Employment Solutions

Web: www.hr-remedies.co.uk