An EAT decision this month emphasised that employers should be proactive when looking for suitable alternative employment for employees in a redundancy situation. The High Court considered whether a business was vicariously liable for the acts of its contractor’s employees.
In Parliament, the Women and Equalities Committee issued a report on paternity and shared parental leave, which may inform the government’s promised review of parental leave.
Chapter 1 They seek it here, they seek it there
The EAT decision in Hendy Group Ltd v Daniel Kennedy emphasises that employers need to take active steps to help employees who are at risk of redundancy find suitable alternative employment. Simply telling employees that they can apply for existing vacancies may make a redundancy dismissal unfair.
Mr. Kennedy had worked for Hendy Group since 2013, initially in sales and later training other sales staff. When his role was made redundant, he accepted that there was a genuine redundancy situation and that his selection was fair. However, he argued that the company didn’t do enough to help him find an alternative role in the organisation and that this made his dismissal unfair.
The tribunal and EAT agreed. Although Mr Kennedy had been told he could apply for vacancies listed on the company’s intranet, he received no further assistance from HR or management and was told that he was not suitable for a sales role, despite his extensive sales experience. When he did apply for internal vacancies, the recruiting managers were not told that he was at risk of redundancy. He was asked to return his company laptop several weeks before his termination date, after which he only had access to externally advertised vacancies. In the circumstances, the employer did not act reasonably in considering alternative employment and the dismissal was unfair.
Next steps
- Employers should go beyond simply informing employees at risk of redundancy about vacancies. They should actively help employees identify suitable roles.
- It may be unfair not to give priority to employees who are at risk of redundancy when applying for internal vacancies.
- Employers should be alert to the need to offer available suitable alternative employment to employees who are on, or who have recently returned to work from, relevant family leave.
Chapter 2 No vicarious liability for acts of contractor’s employees
In recent years, vicarious liability for another’s wrongdoing has expanded to include relationships that are “akin to employment.” Courts consider factors such as integration into an organisation’s hierarchy and the degree of control exercised over the wrongdoer’s work when deciding if a relationship is akin to employment. However, an employer will not be liable for the acts of someone who is a genuine independent contractor.
In J D Wetherspoon Plc v Risk Solutions BG Ltd, the High Court was asked whether Wetherspoon (JDW) was vicariously liable in a personal injury claim for the actions of door supervisors employed by an external security contractor, Risk Solutions, to work at one of its pubs. Risk Solutions supplied the employees to JDW under a security services agreement. The county court found that JDW was liable because it exercised control over the supervisors’ work on a day-to-day basis and their work was integral to its business.
The High Court overturned the decision. The starting point should have been the contractual relationship between JDW and Risk Solutions, which was for the provision of door supervisors by an independent third party in accordance with specified service standards. JDW’s control over the door staff was consistent with ensuring they met those standards and did not displace the general principle that an employer is not vicariously liable for the torts of an independent contractor. Risk Solutions recruited, trained, disciplined and supervised its employees and JDW’s role was limited to ensuring that they were fulfilling the standards required under the agreement. This meant that it was not vicariously liable for the employees’ actions because the relationship was not akin to employment.
Next steps
- This decision is a useful reminder that an employer will not normally be liable for the acts of employees of a third-party contractor.
- Here the county court overlooked the significance of the contractual arrangements between JDW and Risk Solutions. JDW set service standards but did not otherwise exercise day-to-day control of how the individuals performed their duties.
The Women and Equalities Select Committee issued its report into equality at work in the context of paternity and shared parental leave. It suggests that the UK’s approach to family leave remains highly gendered and is out of step with other countries and modern attitudes to parenting. This perpetuates gender stereotypes and contributes to the UK’s sizeable gender pay gap.
To modernise the existing system, the report’s suggestions include:
- Extending paternity leave from two to six weeks, with flexibility about how leave is taken;
- Increasing statutory paternity pay to 90% of average earnings for the first six weeks of leave (matching maternity pay) and making pay a day one right;
- In the longer term, increasing all statutory parental pay to at least 80% of average earnings or the Real Living Wage;
- Strengthening protection against paternity discrimination and redundancy for those taking paternity leave;
- Simplifying the shared parental leave system by streamlining the complex eligibility criteria and reducing notice periods for taking or changing shared parental leave; and
- Considering financial incentives to encourage parents to share leave, such as more paid leave for couples where both parents take similar amounts of leave.
Next steps
- The report’s recommendations may influence the government’s planned review of the parental leave system, which is due shortly.
- However, it remains to be seen whether extending parental pay, which the Committee recognises would require a considerable financial investment, is a political priority in the current economic climate.
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