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Employment Law

Legal guidance - compliance - software

22 AUG 2012

June 2012

This month hrlaw@trowers.com reports on TUPE and pensions liability and considers what constitutes "an organised grouping of employees" for the purposes of a service provision change attracting the application of TUPE. In addition, hrlaw@trowers reports on the provisions of the newly published Enterprise and Regulatory Reform Bill and on the consultation the government has issued on proposed reforms to the Equality Act 2010.

1 Case Law round-up

1.1 The Working Time Directive and entitlement to annual leave of more than four weeks

The European Court of Justice (ECJ) has considered whether Article 7(1) of the Working Time Directive (which provides that every worker is entitled to paid annual leave of at least four weeks) covers entitlements to annual leave where national law provides for an entitlement of more than four weeks in Neidel v Stadt Frankfurt am Main.

1.2 Bonuses and guaranteed minimum bonus pool

The High Court has held in the case of Attrill and Others v Dresdner Kleinwort Ltd and Commerzbank AG that telling investment bank employees that they will participate in a guaranteed minimum bonus pool subject only to assessments of individual performance, gave rise to a contractual obligation.

1.3 Settlement offers and breaking the "chain of causation"

The Employment Appeal Tribunal (EAT) has held in the case of Konczac v BAE Systems (Operations) Ltd that an employee's refusal to accept an offer of settlement can amount to a failure to mitigate her losses (though not on the facts of this case).

1.4 Apportionment of liability in discrimination cases

The EAT has held in the case of Brennan and Others v Sunderland City Council and Others that an employment tribunal cannot determine claims for contribution under the Civil Liability (Contribution) Act 1978 as between parties jointly or concurrently liable for unlawful discrimination.

1.5 TUPE and an "organised grouping of employees"

The EAT has held in the case of Seawell v Ceva that an employee who spends 100% of his time working for a single client, is not necessarily assigned to an organised grouping of employees for the purposes of a service provision change and the transfer of his employment under TUPE.

1.6 TUPE and pension liabilities

The High Court has considered the issue of whether entitlements to an early retirement pension transfer under TUPE, and if so, what the scope for the transferee's obligations is in the case of Proctor and Gamble v SCA.

1.7 Dismissal and human rights

The Court of Appeal has held, in the case of Mattu v University Hospitals of Coventry & Warwickshire NHS Trust, that Article 6 of the European Convention on Human Rights is not engaged when an NHS employer dismisses a consultant for misconduct.

1.8 Withholding payment in lieu of notice and gross misconduct

The Court of Appeal has held in the case of Cavanagh v William Evans Ltd, that an employer is not entitled to withhold a payment in lieu of notice if it dismisses an employee under an express term in his service agreement which provides for summary termination with pay in lieu, if it later discovers that the employer had committed gross misconduct prior to the dismissal.

1.9 High Court confirms cap on pensionable pay may be made by side contract

In Bradbury v BBC, the High Court has held that if an active member of a pension scheme accepts a pay rise on the basis that only part of it is to be pensionable, this may form a binding agreement, subject to any breach of implied duty of trust and confidence or good faith.

2 News

2.1 Justice for business

The Ministry of Justice has published a report entitled 'Justice for business'. It outlines how the government intends to support business through its programme of reforms to the justice system.

2.2 Government publishes Beecroft report

The Government has published venture capitalist Adrian Beecroft's leaked report on employment law. Although the report was completed in October 2011, it has only just been published. The main issue in the report which has sparked press interest is the proposed introduction of "compensated no fault dismissal" for all businesses.

2.3 Challenging conversations and how to handle them

Advisory, Consiliation and Arbitration Service (Acas) has published a guide on how to handle difficult conversations.

3   Legislation

3.1 Queen's Speech 2012: key points for employment lawyers

The Queen's Speech was delivered on 9 May at the State Opening of Parliament, and announced a number of Bills which will be introduced in the next Parliamentary session, which ends in Spring 2013.

3.2 The Enterprise and Regulatory Reform Bill

The Enterprise and Regulatory Reform Bill was laid before parliament last week. It provides for:

3.3 Consultation on proposed reforms to the Equality Act 2010

The government has announced a raft of proposed reforms to the Equality Act 2010.

3.4 Sunday Trading (London Olympic Games and Paralympics Games) Bill receives Royal Assent

The Sunday (London Olympic Games and Paralympics Games) Bill received Royal Assent on 1 May. The Act will suspend the restrictions on Sunday trading hours in England and Wales for the duration of the Games (ie for eight weeks from 22 July to 9 September).

3.5 Protection of Freedoms Bill receives Royal Assent

The Protection of Freedoms Bill received Royal Assent on 1 May and has become the Protection of Freedoms Act 2012.

3.6 Auto-enrolment: qualifying criteria change for career-average schemes

The Department for Work and Pensions (the DWP) is consulting on a technical change to the rules governing whether career-average revalued earnings (CARE) schemes count as qualifying schemes under auto-enrolment legislation.

3.7 Auto-enrolment: amending regulations finalised

The Occupational and Personal Pension Schemes (Automatic Enrolment) (Amendment) Regulations 2012 (SI 2012/1257) have been finalised and will come into force on 1 July 2012.

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