The GULS Law Review

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Employment Law

Labour as a fictitious commodity: The insight of Polanyi and the double movement in the development of the European Union

In this article, Yazdon Taghinia (4th year LLB) examines the concept of labour as a fictitious commodity as argued by the works of Karl Polanyi in the context of the development of the EU.

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No more six pack: The effect of the Enterprise and Regulatory Reform Act 2013 on workplace accident claims and civil liability of employers.

Section 69 of the Enterprise and Regulatory Reform Act 2013 was a drastic change to health and safety law in the United Kingdom, by removing civil liability for breaches of health and safety regulations where not provided for: significantly, impacting the key 'six-pack' heath and safety regulations often relied upon.

In this article Iain Brown, 4th Year LLB and GULS Media & Publicity Convenor 2015/16, considers the effect the 2013 Act will have on the viability of workplace accident claims and the civil liability of employers.

 

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Gender pay gap reporting: Will increased transparency remedy the pay gap?

Despite the introduction of equal pay legislation and changing attitudes to the role of women in society, the United Kingdom remains one of the highest ranking nations in terms of gender pay gap in the European Union. This is a stark reminder of how far the movement for achieving pay equality is yet to go.

In this article, Lamia Lamki, 4th Year LLB, discusses the causes of pay inequality and whether the future introduction of transparency regulations are enough to meet this aim.

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Obesity: a weighty problem for employers?

One quarter of the UK adult population is now obese and it is predicted that half of all adults could be obese by the middle of the century.[0] With this in mind, should obesity be regarded as a disability under the Equality Act 2010 alongside other protected characteristics such as gender, age, race and religion, and if so, how concerned should employers be?

Written by Keith Martin, 3rd Year LLB and sub-editor of the Employment Law section of the review

 

In a Danish case to be considered by the Court of Justice of the European Union later this year, Kaltoft v the Municipality of Billund, the Kolding City Court referred four questions for a preliminary ruling. These questions asked whether a prohibition against discrimination due to obesity exists in EU law and whether obesity is covered by the concept of disability under the Equal Treatment Directive.[1]

 

Mr Kaltoft was dismissed from his job as a child minder with the Municipality of Billund after fifteen years’ service. During this time, he had never weighed less than 25 stone (160kg) and had a BMI of 54. His employer funded gym memberships and exercise classes to help him lose weight but these attempts proved futile. He was eventually dismissed when his employer came to realise that he could no longer carry out significant aspects of his role, such as tying a child’s shoelaces. Kaltoft brought a disability discrimination claim against his employer which was referred by the court in Kolding to the CJEU.[2]

 

Niilo Jaaskinen, an advocate general who advises the court before the judges deliberate and rule, found that EU law did not prohibit discrimination specifically on grounds of obesity, but concluded that “mere” obesity (defined by the World Health Organisation as someone with a BMI of 30 to 34.99) is insufficient to amount to a disability, whereas “severe, extreme or morbid obesity” (someone with a BMI of over 40) may create problems with mobility, endurance and mood that amount to a disability.[3] The advocate general commented that severe obesity can be a disability for the purposes of the Equal Treatment Directive if it “hinders full and effective participation of the person concerned in professional life on an equal basis with other workers”. It is then for the national court to decide whether the person’s obesity amounts to a disability in any particular case. The advocate general’s opinion is not binding on the Court of Justice, but it is almost always followed by the judges, whose rulings are binding across the European Union.

 

The advocate general also threw out the notion that a self-inflicted disability could be any less worthy of protection, saying: “The origin of the disability is irrelevant. [It] does not depend on whether the applicant has contributed causally to the acquisition of his disability through ‘self-inflicted’ excessive energy intake.” According to Jaaskinen, the concept of disability must, under any circumstance, be understood objectively and unaffected by whether the disability is ‘self-inflicted’ due to excessive calorie intake or whether it is caused by metabolic problems.[4] Mr Kaltoft told the BBC that his obesity was the result of “bad habits” and that the council had tried to assist him by paying for him to attend a gym for three months.[5] Under the Equality Act 2010, an impairment will only amount to a disability if it is ‘long-term’ (expected to last for more than 12 months) and there is an argument that, with appropriate dietary and exercise measures, obesity in many cases could be resolved within 12 months.

 

If a person’s obesity is severe enough to qualify as a disability, the employer may face a discrimination claim if the employee is dismissed, subjected to detriment, harassed, victimised or placed at an unfair disadvantage because of their weight. In addition, employers are under a duty to make reasonable adjustments in order to counter the effects of a disability. This could include, for example, creating reserved car parking for obese staff, adjusting office furniture, subsidising gym memberships or reducing duties that involve standing or walking.

 

Employers in some sectors may face particular challenges and wish to rely on the exception that a particular weight or appearance is an occupational requirement. For example, where there are weight restrictions and limited space on board an aircraft, an employer recruiting a flight attendant is likely to require somebody who is not morbidly obese for the job. Others organisations may wish to employ staff who fit their corporate image or the nature of their business, such as premium fashion retailers.

 

Several cases in other jurisdictions have resulted in dismissed workers winning claims that they were discriminated against for being obese. In one case in the United States, a Texan forklift truck operator grew to 48 stone (305kg), becoming too fat for the seatbelt on his truck. He asked his bosses at BAE Systems for an extender but instead the company sacked him. He received $55,000 (£32,800) in compensation for losing his job.[6]

 

Employers would be well advised to take great care when recruiting, disciplining or dismissing employees who may be morbidly obese and should avoid making stereotypical assumptions about their capabilities. Employers should consider what reasonable adjustments can be made for their condition to avoid a potential discrimination claim. Linklaters’ employment partner, Nicola Rabson said: "This decision shifts the burden of keeping those who are severely obese in the workforce to employers, who must make adjustments to accommodate any special requirements arising from a person's disability. Obesity, particularly severe obesity, can be a sensitive subject, so employers will have to tread carefully and not make assumptions about the needs of an obese worker."

 

For the moment, UK employers need to be aware that this issue is rapidly gaining profile. It will undoubtedly be on the radar of trade union representatives across the country, and indeed Europe. Once the full judgment of the Court of Justice is issued, claims of disability discrimination based on an employee’s obesity may follow. The ruling is expected early next year.



[0] Marie Ng et al., ‘Global, regional, and national prevalence of overweight and obesity in children and adults during 1980—2013: a systematic analysis for the Global Burden of Disease Study’ 2013 The Lancet, Volume 384, Issue 9945, 766 – 781. 

[1] International Law Office, ‘Advocate general: obesity may constitute a disability’, 24 September 2014, available at: http://www.internationallawoffice.com/newsletters/Detail.aspx?g=53ec0b57-3a6d-4430-9b85-184d5cd6000e Last accessed: 16 October 2014.

[2] Employment Law On Demand, ‘Obesity – is it a weighty problem for employers?’, July 2014, available at: http://employment.law-ondemand.com/obesity-is-it-a-weighty-problem-for-employers/ Last accessed: 14 October 2014.

[3] The Guardian, ‘Severe obesity is a disability, European court adviser rules’, 17 July 2014, available at: http://www.theguardian.com/law/2014/jul/17/obesity-disability-european-court-discrimination-claim Last accessed: 15 October 2014.

[4] The Guardian, ‘Severe obesity is a disability, European court adviser rules’.

[5] BBC News, ‘EU's top court may define obesity as a disability’, 12 June 2014, available at: http://www.bbc.co.uk/news/world-europe-27809242 Last accessed: 15 October 2014.

[6] The Guardian, ‘Severe obesity is a disability, European court adviser rules’.



Zero-Hour Contracts: The Capitalist Dream

 

Written by Rachel Murphy (2nd year LL.B)

We live today in the golden age of capitalism; the longest surviving economic order. This is a time in which anybody from anywhere can prosper on the basis of hard work. However, it is not surprising that capitalism is often criticised. It is, after all, founded in the natural greed of humankind. It is obvious that while some are very rich, others will be very poor, and that the rich will be more powerful. This has all been somewhat accepted and stabilised by the state. However, as the economy -and so politics- continues to be dictated by a small number of corporate owners, it is becoming increasingly difficult to prosper.

 This may also seem unsurprising in light of the Marxist critique which says that workers are exploited through this economic system; but has the introduction and popularisation of zero-hour contracts taken this a step too far? This method of employment -whereby workers have virtually no exercisable rights- first became popular in low-paid, unskilled jobs, but is now spreading into other types of employment. Under such a contract an employee is expected to be available to work if needed, but is only paid if actually used. This is compliant with both the National Minimum Wage Act 1998 and the Employment Rights Act 1996; but is it acceptable? There are many people desperate for work who are subsequently forced to accept such a contract of employment, even though it offers no guarantee of a reliable income. It could be argued, therefore, that the zero-hour contract goes beyond the necessary evils of capitalism as it goes against that which people seek in employment: security of income, which in turn secures family life and the ability to get a mortgage. Surely the least one can expect from our employer is the guarantee of work and pay? It is estimated that in the UK there are over one million zero-hour workers,[1] some of whom even work for publicly funded institutions such as the NHS and care sector.

 

However there are industries in which such a contract may be necessary, such as retail and the service sector. It cannot be denied that a business would benefit from being able to staff itself as required day by day; but where should the line be drawn between businesses which require this and those that do not? Regardless, it is not the case that a business would need to roll this out across its whole staff. Having any more than a small percentage of staff on a zero-hour contract seems immoral since the balance of power then lies wholly with the employer. In this situation the scope for abuse is huge. Staff have little rights since, in speaking up, they risk being given no shifts which is entirely legal and could not be queried.

 

In a recently published research report, the Chartered Institute of Personnel and Development (CIPD) found that 17% of zero hour workers are sometimes penalised for not being available to work the hours they are given.[2] Additionally, staff know that they could easily be replaced because of the high levels of unemployment and so have little choice other than to put up with how they are treated. The flip side of this is that there are people employed under zero-hour contracts who work regular hours for a substantial period of time. In this way, employees will sometimes not have the correct holiday allowance for the hours that they are working and may not be paid overtime wages when they should be. The trade union Unite is one of many campaigning against the use of these contracts, saying that "employers use them to cut wages, avoid holiday pay, pensions, or other benefits enjoyed by employees and agency staff".[3] There is no good reason why people in this situation should not have a contract which actually represents the work they do. This is “a culture in which employers are allowed to treat their workers as disposable cogs in a commercial machine”[4] and so it is no surprise that the zero-hour contract pushes workers to the extremes of what they are willing to accept in the name of capitalism.

 

The defence of companies using zero-hour contracts is often that it suits a lot of their workers, such as students, young people or the elderly, because it affords flexibility for part-time work. In the CIPD report, 47% of zero-hour workers questioned said that they were satisfied with having no set minimum hours in their contract.[5] It seems possible that this is why the zero-hour contract has been accepted without more fuss; it is generally students or pensioners who tend to be given them.[6] In spite of the fact that this may entail taking advantage of naivety, it is fair that most people with a part time job will benefit from flexible hours. The problem is that there is nothing to stop companies using them more, such as in jobs where the majority of the staff have responsibilities and bills to pay. The Shadow Business Secretary, Chuka Umunna, commented that "for most working people they [zero-hour contracts] mean insecurity for them and their families and leave them subject to the whim and demands of their employer to work at short notice, so the flexibility is not a two-way street".[7] The fact that this is entirely legal almost seems like a loophole in the law, and one which employers are rapidly making use of.

 

People under such employment terms are classed as being employed for the purpose of national statistics and therefore the rate of unemployment is masked. Could this be why ministers have been so slow to react? Zero-hour contracts have been in popular use for around ten years but only in recent months have proposals for change been made. From June 2013 Business Secretary Vince Cable lead a review of zero-hour contracts for the government and in September proposed restrictions on certain uses, such as when the employee is not permitted to simultaneously work elsewhere (so called "exclusivity clauses"), or when the employee is actually working regular hours. This welcome proposal was in light of the UK's embarrassingly low placing in the G20 pay league, and was followed by a consultation on such contracts by the government which began late last year and will run until March 2014.

 

As a nation we are becoming ever more accepting of being treated poorly by our employer. The "that's capitalism though" justification is given so often, but do we really mean it? It is currently unlikely that zero-hour contracts will face an outright ban, but action is finally being taken. However, it may not be enough only to target certain uses of them - such as "exclusivity clauses" - which, so far, seem to have been the main point of controversy. The main issue, which requires to be promptly dealt with, is the exploitation and corruption that these contracts allow. It is never necessary to have an entire staff on a zero-hour contract, but doing so affords more power to the employer. Hopefully the consultation will begin a new path, not only towards better employment and financial security, but also towards a new frame of mind that being treated poorly by an employer is not acceptable. The rights of employees should never be sacrificed in order to profit the business.



[1] Chartered Institute of Personnel Development Research Report, ‘Zero-hours contracts: myth and reality’, November 2013, at p.4, http://www.cipd.co.uk/binaries/6395%20Zero-Hours%20%28WEB%29.pdf,  last accessed on 14.01.14 at 18.00.

[2] Ibid., 4.

[3] Unite website, ‘Government must act to halt rise in zero hours’, 1 August 2013, http://www.unitetheunion.org/news/governmentmustacttohaltriseinzerohours, last accessed 13.01.14 at 14:00.

[4] Hardy. Ruth, The Guardian [online], ‘It's not zero-hours contracts that are the problem, it's the bosses who abuse them’, 19 December 2013, http://www.theguardian.com/commentisfree/2013/dec/19/zero-hours-contracts-vince-cable-crack-down-exploitation, last accessed 13.01.14 at 14:00.

[5] Chartered Institute of Personnel Development Research Report, ‘Zero-hours contracts: myth and reality’, November 2013, p.4, http://www.cipd.co.uk/binaries/6395%20Zero-Hours%20%28WEB%29.pdf,  last accessed on 14.01.14 at 18.00.

[6] Pennycook. Matthew, Cory. Giselle, & Alakeson. Vidhya, Resolution Foundation, ‘A matter of time, the rise of zero-hours contracts’, June 2013, at p.10, http://www.resolutionfoundation.org/media/media/downloads/A_Matter_of_Time_-_The_rise_of_zero-hours_contracts_final_1.pdf, last accessed 14.01.14 at 19:00.

[7] House of Commons Debate, 16 October 2013, cc745-746, http://www.publications.parliament.uk/pa/cm201314/cmhansrd/cm131016/debtext/131016-0001.htm#13101671000001, last accessed on 14.01.2014 at 18:00.  

Employment Tribunal Fees: Killing the Claimant

 

Written by Andrew Rutherford (4th year LL.B)

Since their introduction by the Industrial Training Act 1964, Employment Tribunals have become a cornerstone of our legal system. The Tribunals hear claims which range from recovery of holiday pay to complex equal pay cases involving thousands of claimants. Work is an essential part of everyday life and the system sought to recognise the importance of allowing access to employment law protection. In a stretched job market employers enjoy supreme bargaining powers with employees and potential employees. It is therefore essential that access to employment protection is unhindered.  The Tribunal system was originally designed to be accessible and to encourage self-representation. However, growing complexities in employment law have seen numbers of claimants with no representative fall to below 5%.[1] Despite this, many employers feel that the accessible nature of Employment Tribunals leads to a number of frivolous, time-consuming and expensive actions at a great cost to businesses and to the taxpayer. This has led the government to introduce Employment Tribunal Fees of £950 for each claim with the aim of transferring £74 million from the taxpayer to the Employment Tribunal user. But does this offer too much protection to the employer at the expense of the employee? Is it fair? And, more importantly, is it legal?

The fees, which are set to be introduced on the 29th of July, join a raft of regulations designed to protect the employer. In most cases, to bring a claim of unfair dismissal, an employee must have two years continuous service. Even if this requirement is met they must not only show that the dismissal was unfair, they must also show that it was outwith the band of reasonable responses. This test means that employees are rarely successful in convincing the Tribunal to award them compensation. Additionally, out-of-work claimants often struggle to afford a solicitor to represent them and must instead rely on a trade union representative. Claimants only have a restrictive three month window in which to bring their claim which is incomparable with the three year window which applies to personal injury claims. To say that the system is currently weighed in favour of the employer is a colossal understatement and the introduction of tribunal fees will only see the balance tip so far in the employer’s favour that the employee’s pursuit of a remedy will be hopeless, unaffordable and unrealistic.

Thus, the introduction of fees has been met with wide condemnation. The Law Society of Scotland has stated that it believes the fees to be a “barrier to justice”[2] and that they will hit the “‘squeezed middle” the hardest as they will not be eligible for fee remission. Additionally, it is likely that the fees will disproportionately affect women as the tribunals have jurisdiction over sex discrimination and equal pay cases. The indirect discrimination caused by the fees is one of many arrows in the quiver of those opposed to Tribunal Fees.[3] Whilst there are many who believe that action needs to be taken to tackle the “Claims Culture”[4] and to encourage early settlement it is widely believed that forcing the Claimant to pay fees before a claim is brought will fail in achieving the aims [5] of employment law protection and is inherently unfair.[6] It is, therefore, no surprise that judicial review proceedings have been lodged against the introduction of fees which seek to challenge their legality.

The first of these judicial review applications was lodged by UNISON in England. It was a written application on four grounds:

  1. Fees restrict individual employment law conferred by European Union Law to the extent that they are virtually impossible or excessively difficult.
  2. “It is a breach of the principle of equivalence to require significant fees to be paid to vindicate EU rights where no fees are required to vindicate similar rights derived from domestic law.”
  3. The government has failed to carry out proper public sector equality impact assessment.
  4. The introduction of fees will disproportionately affect women.

The High Court in England rejected this application on the 23rd of July.[7] However, UNISON has stated that it will apply for a full oral hearing.

Meanwhile, in Scotland, Employment Law specialists Fox and Partners have lodged an application for judicial review on similar grounds. The firm failed in its bid to block fees with an interim interdict but was successful in being granted a full hearing to be heard later this year. Furthermore, Lord Bannatyne ordered costs and expenses to be paid by the Lord Chancellor’s department and reportedly stated that the conduct of their response had been “a complete waste of time”.[8] The application will proceed on both Domestic and European law and, if successful, would see the government being forced to reimburse all those who pay fees before the application is reviewed.

But how likely is the challenge to succeed? On the face of it, the argument of equivalence appears extremely strong. EU law prohibits the requirement of fees to enforce EU rights when there are not equivalent fees in the protection of domestic rights. As many employment rights are conferred from European Union Law, the fees required must be equivalent to those payable in the protection of other domestic rights. The £950 required to bring a claim in the Employment Tribunal is significantly higher than the £207 hearing fee which applies in the Sheriff Court.[9] It is difficult to see how this can be justified since a claim that fees are necessary to prevent vexatious litigants can be easily dismissed. When a claim is vexatious a respondent may apply for costs to be awarded additionally and if a claim has no reasonable prospect of success then it may be struck out without a hearing. These mechanisms adequately protect employers from incurring the cost of defending a hopeless claim and it appears that there is little need for the extortionate hearing fee in employment tribunals. This particular ground of the judicial review application therefore seems to have a significant chance of success.

Furthermore, it is certainly likely that women will be disproportionately affected by the introduction of fees. Not only are the Tribunals used for equal pay cases but they are also used for sex discrimination claims. These claims will now incur Tribunal Fees. It is difficult to contemplate any reasonable justification for this indirect discrimination and it seems likely that the application may be successful.

In times of economic difficulty it is obviously of extreme importance to protect businesses as much as possible. Clearly, the government had this in mind when deciding to introduce Tribunal Fees. Such logic is flawed as a business is only truly valuable to the economy if it offers secure employment. Introducing radical employment fees makes it extremely difficult for employees to enjoy the benefits that businesses confer as they will be unable to protect themselves from unfair dismissal, discrimination and harassment. It is clearly an attempt to rid the tribunals of the “pesky” claimant without due consideration of the consequences. The outcome of the judicial review application will have a colossal effect on employment relations for years to come and a failure to block the introduction of fees could see thousands of Davids finally crushed below the foot of their respective Goliath.



[1]p10, Table 4- Employment Tribunals and EAT Statistics, 2011-12

[2]IDS Employment Law Brief 947, April 2012

[3]http://www.unison.org.uk/news/date-set-for-justice-over-tribunal-fees

[4]'Countering the Claims Culture' Emp. LJ. 2013, 141(Jun), 6-8

[5]IDS Employment Law Brief 947, April 2012

[6] Statham, P. 'Why Tribunal Fees are Unfair' Employer's Law 2012, Nov, 11

[7]http://www.workplacelaw.net/services/news/48279/high-court-rejects-unison-tribunal-fees-judicial-review

[8]'Fees Challenge to Proceed' Fox and Partners July 11th Available at: < http://www.foxandpartners.co.uk/fees-challenge-to-proceed/>

[9] Sheriff Court Fees Available at <http://www.scotcourts.gov.uk/rules-and-practice/fees/sheriff-court-fees>