Abuse, status, last-straw

01 July 2020

Nicola Mullineux, senior employment specialist for Peninsula, reviews the decisions in three cases

Bridges v Yodel Delivery Network

In this case, the European Court of Justice (ECJ) assessed whether a gig-economy worker who was able to provide substitutes when doing work for an organisation could still be classed as a ‘worker’ and not ‘self-employed’.

UK law outlines that individuals classed as ‘workers’ are those who perform services personally for an organisation which is not considered their client or customer. In contrast, self-employed individuals are those who provide services for their own account by running their own business, hiring their own workers and providing their own equipment. European Union (EU) law outlines that an essential part of an employment relationship is that the individual performs work or services for, and under the direction of, an organisation.

Upon commencement of his role as a parcel courier for Yodel, Mr Bridges signed a contract that specifically labelled him a ‘self-employed contractor’. He was able to use his own vehicle and phone, did not wear a uniform or display any other form of branding despite using a Yodel-branded hand-held scanning device and, crucially, could provide a subcontractor to perform all or part of his services. He could also provide his services to other organisations. The claimant later argued that he should actually be considered a ‘worker’, not ‘self-employed’ as he had never substituted his services or made deliveries for other organisations.

In a preliminary hearing, the employment tribunal (ET) found that his ability to provide substitutes was ‘fatal’ to his claim under UK law, as was his ability to undertake work for other organisations. However, they noted that this may have been incompatible with EU law and therefore asked the ECJ for further clarity.

The ECJ explained that EU law needed to be interpreted as precluding a person engaged by an organisation from being classified as a ‘worker’ when that person is afforded discretion:

  • to use subcontractors or substitutes to perform the service which they have undertaken to provide
  • to accept or not accept the various tasks offered by their putative employer, or unilaterally set the maximum number of those tasks
  • to provide their services to any third party, including direct competitors of the putative employer, and
  • to fix their own hours of ‘work’ within certain parameters and to tailor their time to suit their personal convenience rather than solely the interests of the putative employer.

Looking at the specific facts of this case, the ECJ noted that the claimant had a great deal of latitude as he had the right to say no to work and to work for competitors. The ECJ therefore concluded that whilst it was for the domestic court to determine the employment status of the claimant, there did not appear to be a ‘relationship of subordination’ between him and Yodel.

It is always important for employers to ensure that the relationship with a contractor does not stray into ‘worker’ territory; as seen here, labelling an individual ‘self-employed’ will not automatically mean this is the case if the actual relationship is different.

BDW Trading Limited v Kopec

In this case, the employment appeal tribunal (EAT) ruled that the ET had erred by finding an employer had harassed an employee despite also finding its officers had not been motivated by discrimination.

Under the Equality Act 2010, direct discrimination occurs where a person is treated, or would be treated, less favourably ‘because of’ a protected characteristic compared with others in like-for-like circumstances. If the claimant establishes a case which at first sight indicates that discrimination could have occurred, then the ‘burden of proof’ switches to the organisation, which then has to show a non-discriminatory reason for their actions.

In the eyes of the law, employers are not automatically liable for discriminatory acts committed by third-parties. The 2019 Court of Appeal case – Unite the Union v Nailard (‘Nailard’) – outlined that the failure of managers to act in situations of third-party harassment would only breach the law if managers had a discriminatory motivation.

The claimant, Mr Kopec, was originally from Poland and identified as a heterosexual male. During a shift, the claimant was racially abused by a delivery driver, something that was overheard by his manager, Ms Lane. She was appalled by what she heard but also blamed the claimant for his own conduct during the confrontation.

A second incident took place, where the claimant was again racially abused and subjected to comments about his perceived homosexuality. Ms Lane was again critical of the claimant’s conduct and implemented a disciplinary procedure against him, feeling he was not prepared to discuss his shortcomings. Upon receiving a verbal warning, Kopec texted the alleged abuser demanding that he come forward and ‘tell the truth’ about the incident.

As a result of the text, the claimant was suspended. He later resigned and brought numerous claims to ET, citing racial and sexual orientation discrimination, harassment and constructive dismissal.

The ET explained that the employer’s failure to effectively deal with the claimant’s complaints and an ignorance of equality policies shifted the burden of proof to them to establish discrimination had not taken place. However, the ET ultimately held that a hypothetical comparator who did not share the claimant’s protected characteristics would have been treated the same; he had been dismissed due to his conduct, not because of the prejudices of the organisation.

The employer appealed, arguing that as the ET had found its actions were not tainted by discrimination, it could not have harassed the claimant. The EAT agreed and remitted the decision to the ET to apply Nailard to a fresh judgement.
This case follows on from the Nailard ruling, confirming employers are not automatically liable for third-party discrimination. However, their actions or inaction in these situations could still lead to other tribunal claims, such as constructive dismissal. To this end, it is important to observe the behaviour of third-parties in relation to staff and take action where necessary.

Williams v Alderman Davis Church in Wales Primary School

In this case, the EAT found that in claims of constructive dismissal, even if the ‘last-straw’ act that led to a resignation is considered innocuous, a claimant can still rely on prior actions from the employer.

To establish constructive dismissal, a claimant must show that the organisation’s actions amounted to a serious breach of contract that led to their resignation. However, this can be difficult to prove if they continue to work for the employer after such an action, as this can suggest their affirmation to this breach. Examples of conduct which can give rise to constructive dismissal include breaching the implied term of mutual trust and confidence between an employee and their employer, which is known as the ‘Malik term’.

The ‘last straw’ principle relates to a series of actions by an organisation which, overall, can lead to a Malik-term breach. In the case Omilaju v Waltham Forest LB the Court of Appeal outlined that the last action which leads to a resignation does not need be the most serious but must contribute to the breach overall. An innocuous act, in other words something that is deemed not to be harmful, will not count.

Mr Williams was considered disabled due a mental impairment which meant he had problems responding to stressful environments. He was suspended due to a child protection matter whilst the school implemented a disciplinary procedure and conducted their own investigations. Prior to suspension, the claimant downloaded a number of school files and shared them with his trade union representative, in an attempt to gather evidence he was being mistreated.

Although the claimant was informed that the accusations against him related to his mishandling of a child, the school refused to disclose who had made the accusation, who the child was and what it was alleged he had actually done. In response, the claimant raised a grievance, citing the situation had been handled poorly and was having a negative impact upon him.

On discovering the downloading of the files, the school implemented a separate disciplinary against him and the union representative for breaching its data protection policy.

The claimant wrote a detailed letter expressing his concerns and, three days later, resigned. His main reason for the resignation was that the school had refused to let him contact the union representative, which he labelled the ‘last straw’.
Though very critical of the school, the ET held that the claimant had not been constructively dismissed. This was because the ‘last straw’ act, the limiting of communication between him and his union representative, was reasonable due to the data protection issues and therefore innocuous.

The claimant’s appeal was upheld. The EAT outlined that in situations where there is a Malik-term breach by the employer, the ‘last straw’ does not necessarily need to be the last event in a point of time. The tribunal had erred as they had failed to consider how the earlier conduct of the school had led to such a breach, and also whether the claimant had affirmed these actions.

In the EAT’s view, it was clear that the employee had not affirmed them; his final resignation had been done with all the previous actions, and concerns, in mind. This was evident due to the letter he had written three days prior. The EAT therefore substituted a finding of constructive dismissal.

Employers should bear in mind that even if the act that leads to an employee resigning is found to be harmless, earlier acts may still result in liability. It is therefore important to remember what acts can lead to such a claim, such as significantly changing the terms and conditions of an employment contract or bullying behaviour.

Featured in the July/August 2020 issue of Professional in Payroll, Pensions and Reward. Correct at time of publication.