Thursday, October 21, 2010

Settling through ACAS - it's too late to change your mind!

The Scottish Employment Appeal Tribunal has handed down a ruling which reminds parties that a settlement through ACAS can be binding even though it is never formally put in writing.

Mr Bonner was bringing a claim for Unfair Dismissal.

His Solicitor spoke to his opposite number, who put forward an offer of £1000.00 on behalf of his client. After speaking to Mr Bonner, who confirmed he wanted to accept, the Solicitor rang the ACAS officer in the case. He left a message on the ACAS voicemail accepting the offer.

Both parties then expected that ACAS would assist with finalising a form of wording for a "COT3" ACAS settlement agreement formally recording the terms agreed.

Mr Bonner then changed his mind about settlement and his Solicitor sent the other side a Schedule setting out his alleged losses. In the meantime the parties asked the Tribunal to adjourn the hearing whilst discussions went on about settlement. The Respondent was adamant that there was a binding settlement, the Claimant said that there was not.

The Employment Tribunal decided that as the ACAS Officer had not spoken directly to both parties and as a COT3 would usually contain other provisions (for example for a reference to be given, or about confidentiality) there was not a binding settlement.

The Scottish EAT overturned this. It said that there had been a clear offer and a clear acceptance. The ACAS officer had "taken action" in the case. It was not a requirement of the legislation in order for the settlement to be binding that he had actually brokered the deal or physically spoken to both sides. Whilst COT3s did usually contain other provisions, there was no express agreement here to that effect and the settlement did not need any other terms in order for it to be implemented.

Mr Bonner was therefore stuck with his £1000.00.

The case is a reminder of the often forgotten fact that once a verbal agreement is reached with the assistance of ACAS it is binding and the production or signature thereafter of a COT3 (or the lack of those things) does not mean the case can be reopened. If a deal is subject to a COT3 wording being agreed then this should be specifically stated.

An interesting aside is that the Solicitor who acted for Mr Bonner in relation to the settlement not only represented him at the Employment Tribunal but also gave evidence on his behalf. The EAT expressed considerable surprise not only at the fact that he had done so but also that he did not appear to see any potential issue with this.

The case is reported at:-

Friday, October 15, 2010

Unfair Dismissal Time Limits - The Voice is Mightier than the Pen!

The Supreme Court, the highest Court in the land, has confirmed a previous Court of Appeal decision that a dismissal by letter takes effect when the Employee reads the letter, not when they receive it.

Ordinary principles of postal service would deem someone to have received a Court document sent to them by post on the second working day after it was posted by first class post. Contracts of employment will often deem notices to be effective in those circumstances and that time scale is sometimes treated as a rule of thumb for when someone should be expected to have received other documents in the post.

Determining the exact date of dismissal is essential because there is a strict 3-month time limit from the date of dismissal to start an Unfair Dismissal claim. It may also be relevant in some cases where the date of dismissal will determine whether the employee has the necessary 12 months' continuous service to be able to bring a claim in the first place.

Miss Barratt was dismissed from her employment by means of a decision communicated by letter following a disciplinary hearing. She was away from home when the letter was arrived and did not ask anyone to read it down the telephone to her. She read the letter on her arrival home. She presented her Unfair Dismissal claim to the Employment Tribunal within 3 months of the date she read the letter but more than 3 months after it arrived at her home.

If the former was the date of dismissal she could bring her Claim, if it was the latter she was out of time and her Claim would go no further, regardless of the underlying merits.

After reviewing the authorities the Supreme Court decided against importing a strict contractual approach into the test and held that the matter should be determined purely and simply by ascertaining the date on which the letter was read. Somewhat optimistically the Supreme Court thought that this should not be a difficult task in most cases.

The decision leaves open the possibility that where someone has had a reasonable opportunity to read the letter and does not do so the time will start to run against them. This is somewhat at odds with the stated intention of enabling the termination date to be established with certainty but must be right from a practical point of view, otherwise an employee expecting bad news would be able to simply avoid opening the envelope.

Miss Barratt had previously been held not to have gone away with the intention of evading the letter and therefore did not fall foul of this possible exception.

Lesson for employers - tell the employee to their face they are dismissed, even if this means calling them back in for a brief meeting, and then confirm it in writing.

Lesson for employees - do not leave presenting your Claim until the last minute and always assume the earliest possible termination date when calculating the 3 months.

The case is reported at:-

Friday, October 01, 2010

Equality Act 2010 Comes Into Force

In keeping with the practice of bringing into force new employment laws on 1st April and 1st October only, the majority of the provisions of the Equality Act 2010 come into effect today.

The Act is intended to codify the existing legislation on discrimination and iron out discrepancies that had arisen in relation to the legal treatment of different types of discrimination.

The definition of direct discrimination is altered so that this applies where someone is discriminated against "because" of e.g. sex rather than "on grounds of" it. The Act makes clear that (save in relation to marital/civil partnership status) discriminating against someone because they are perceived to have a protected characteristic (e.g. are wrongly perceived to be gay) or because they are associated with someone with a protected characteristic (e.g. because they are the carer for a disabled person) is unlawful.

One change likely to affect employers on a day to day basis is the restriction on asking questions about health, including disability, before a job offer is made except in specified circumstances. You may need to look at your Job Application forms and the questions you ask at interview to ensure you do not fall foul of this.

The Act also provides for a number of changes that have not yet been brought into force. One is provision for claims based on combinations of discrimination - for example it is now unlawful to treat someone less favourably because they are a black woman (i.e. where a white woman and a black man would have been treated differently.) Whilst this development has been heralded it does seem rather unlikely that it will be one that leads to an explosion in litigation if and when it is introduced.

Perhaps the most controversial provisions that are still "pending" are those which provide for private sector employers to be compelled to carry out gender pay audits and that which permits positive action in very limited circumstances with regards to recruitment and promotion. Neither of these are very "Tory" sounding policies but whether the effect of coalition politics will be to get these into law remains to be seen.