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May 13, 2024
•May 13, 2024•

Whistleblower Protection Following Nicol V World Travel And Tourism Council

Whistleblower Protection Following Nicol V World Travel And Tourism Council

Author: Sam Evans

Key Contact: Claire Knowles

In Nicol v World Travel and Tourism Council, (“Nicol”) the Employment Appeal Tribunal held that the decision maker in a whistleblowing claim must possess some understanding of the substance of a disclosure in order to be held liable under the Employment Rights Act 1996 (“the ERA”). Details of the full judgment can be found here.

Background

Mr Nicol was employed as Vice President of Communications and PR by the World Travel and Tourism Council (“WTTC”). He raised concerns about the management style of Gloria Guevara, the President and CEO of WTTC, to two HR consultants retained by WTTC via email. The consultants then informed Ms Guevara that there had been complaints about her management style and treatment of junior staff. At no time did they particularise the claimant’s allegations relating to Ms Guevara.

He was subsequently dismissed by Ms Guevara by reason of redundancy.

Mr Nicol sought to argue that his dismissal was automatically unfair pursuant to section 103A of the ERA. This provision means that the dismissal of an employee will be automatically unfair if the reason, or principal reason, for the dismissal is that they made a “protected disclosure”. In the alternative, he also argued that he suffered detriment due to whistleblowing under section 47B(1) of the ERA.

At first instance, the Employment Tribunal dismissed Mr Nicol’s arguments. In paragraph 112, the Tribunal explicitly states that “the respondents never considered that the claimant was actually a whistleblower and that this played no part in their decision to dismiss him”. Therefore, whilst Mr Nicol had made disclosures to the HR consultants, Ms Guevara was not sufficiently aware of the detail of the complaints for the decision to be motivated by the disclosures.

Appeal

Mr Nicol appealed to the Employment Appeal Tribunal on various grounds including that the Employment Tribunal had misapplied the law when considering whether WTTC believed him to actually be a whistleblower when deciding to dismiss him.

However, Sheldon J dismissed the appeal. He held that the Employment Tribunal had not misapplied the law and that paragraph 112 of the tribunal’s judgment had to be read in context. Firstly, the reasons given by Ms Guevara in a letter to the board of WTTC did not mention the whistleblowing allegations whatsoever and none of the contemporaneous WhatsApp allegations mentioned them. Further, WTTC ultimately regarded the disclosures as being part of his negotiating strategy and that, therefore,  Mr Nicol was not dismissed for making disclosures, regardless of whether they were considered as “protected disclosures” or not.

Comment

This judgment emphasises the benefit of approaching redundancy situations using a clear, considered, and well-documented business perspective. Where the rationale for decision-making is unclear, uncertainty may allow for adverse inferences to be drawn regarding the relevance and weighting of motivating factors.

Organisations should also regularly review their whistleblowing policies and procedures and communicate clearly any changes to their staff.

This case can be usefully contrasted with the earlier case of Royal Mail Group v Jhuti where a decision maker was held liable under Section 103A of the ERA even where they had no knowledge that a protected disclosure had been made. However, the difference in that case was that the decision maker had been unknowingly deceived into dismissing Ms Jhuti by a bad faith actor who knew full well about the content of the protected disclosure and fabricated a reason to dismiss because of the disclosure.

If you need further guidance about best practices for your business to avoid whistleblower claims, then please get in touch with the employment team at Acuity Law.

•May 13, 2024•

To Tip Or Not To Tip? How The Employment (Allocation Of Tips) Act 2023 Will Impact The Hospitality Industry

To Tip Or Not To Tip? How The Employment (Allocation Of Tips) Act 2023 Will Impact The Hospitality Industry

Author: Sam Evans

Key Contact: Claire Knowles

What is the Employment (Allocation of Tips) Act?

From 1st October 2024, the Employment (Allocation of Tips) Act (“the Act”) will enter into force following parliamentary approval. The legislation intends to prevent businesses in the hospitality sector from unlawfully withholding tips and service charges from their employees, workers, and agency workers.

The Act includes the following key obligations:

  • pass on all tips and service charges to workers without deductions, except in limited circumstances, such as deduction of tax;
  • a requirement to allocate tips in a fair and transparent manner;
  • if it is fair to do so, the employer may pay the tips over to an “independent tronc operator” who will allocate them to workers;
  • any organisations that pay qualifying tips, gratuities, and service charges on more than an occasional and exceptional basis will need to have a written policy setting out how those tips are dealt with and make the policy available to all workers; and
  • maintain a record of all tips paid at their place of business and their allocation to each worker (and each worker has the right to request access to this).

For the moment, the Act does not cover more casual tipping practices where tips are paid directly to workers in cash, or pooled by the workers themselves, and not paid to their employer. However, it would apply where such tips are subject to employer control (i.e. if the employer directed its staff to distribute such tips equally amongst themselves).

Workers will be able to bring a claim before an employment tribunal where there has been a failure to comply with any obligations regarding allocation or payment of qualifying tips. The time limit to bring such a claim is 12 months from the date of the breach of the obligations. The tribunal may order the employer to pay compensation of up to £5,000 for any financial loss suffered because of the breach. A worker may also bring a claim if an employer fails to comply with the duty to maintain a written policy but the time limit for this will be 3 months.

How will the statutory Code of Practice impact the hospitality sector?

Following passage of the Act through Parliament, the government confirmed that it would lay before Parliament a statutory Code of Practice (“the Code”) to promote best practices in how to distribute qualifying tips, gratuities, and service charges.

On 22nd April 2024, the government published the Code.

The Code covers four main areas:

  • qualifying tips and qualifying workers;
  • the factors and methods relevant to fairness;
  • transparency; and
  • addressing problems.

In terms of fairness, the Code explicitly recognises that the obligation to fairly allocate tips does not necessarily require employers to allocate the same proportion of tips to all workers. Indeed, there may well be legitimate reasons for such differing allocations, but any employers should duly consider all staff and use a clear and objective set of factors. The Code also sets out an illustrative checklist of factors to determine.

Interestingly, the use of tipping apps to allocate tips would appear to be a bit of a grey area. The Code contemplates that such apps would be outside the scope of the Act. However, this is by no means clear and employers should consider very carefully if any tipping app they use falls outside the scope of sections 27C(3)(b) and 27C(9) of the Act and the effect this has on app fees.

Non-compliance with the Code will not itself give rise to a claim, but it will be admissible in evidence for employment tribunal proceedings.

How have organisations reacted to the Act?

Recently, a London restaurant chain announced it would be testing a new policy whereby it would not allow customers to tip by card and would instead introduce an optional “brand fee” which would not be shared among staff. Staff wages will rise by 19% to compensate for the loss of tip allocation.

At the moment, this new policy is being treated as a trial and the restaurant will reach a firm decision on whether to continue with the policy in June 2024.It remains to be seen whether other restaurants will adopt such practices moving forward.

Comment

Given that the Act’s entry in force has now been delayed until 1st October 2024, we would recommend that organisations comprehensively plan how they will implement the requirements of the Act and update their policies as necessary to avoid any potential future claims.

If you would like to seek expert advice about the provisions of the Act or the Code, or would like support drafting your business’ tipping policy, then don’t hesitate to contact Acuity Law’s employment team.

•May 13, 2024•

Reform Of The Sick Note

Reform Of The Sick Note

Author: Laura Spence

Key Contact: Claire Knowles

Last month, the Department for Work and Pensions and Department of Health and Social Care issued a call for evidence to explore reforming the fit note process.

Why is this happening?

This comes following the Autumn Statement last year which confirmed the Government’s intentions to carry out a ‘Back to Work Plan’ for welfare reforms. 

The call for evidence is set to remain open until the summer months, which is likely to be followed by a full consultation on specific policy proposals later in the year. This call for evidence is therefore, set to shape the future of the fit note.  

Many people that take periods of sick leave can return to work fairly quickly, without the need for additional support following the issue of a fit note. Many workers though, including those that are more vulnerable and/or suffering with chronic conditions, may require a more detailed assessment and discussion about their work and health. This call for evidence is intended to provide a better understanding of how those with long term health conditions can access timely work and health support, with the view of getting people back to work.

This comes at a time the Prime Minister describes as a “sick note culture”.  He says that we don’t just need to change the sick note we need to change the sick note culture. Rishi Sunak has claimed that to get out of this sick note culture, he wants to change sickness absence procedures, including obtaining fit notes, to reflect what workers can do, rather than what they cannot do. If the current proposal is implemented, it is also likely that fit notes will no longer be issued by GPs, but specialist work and health professionals instead. If the Labour party are elected, we could see a completely different approach. Nonetheless, this collation of evidence is likely to shape the relevant political party’s approach.

What does this mean for employers?

The Government hopes to collect as much evidence as possible to assess the impact of the current fit note process from the perspective of employers, healthcare professionals, individuals, and other interested parties.

Employers will have the opportunity to comment on the efficacy of the current fit notes process, and in particular whether it is meeting their business needs or alternatively, what could be improved. The Government is particularly keen to find out:

  • Whether additional information would be useful for a “may be fit to work” fit note which in turn could support employees return to work.
  • About employers’ experience with private providers who supply fit notes (or “work sickness certificates) for fees.
  • About employers’ experiences in general with fit notes, including in relation to the role of occupational health.

Other individuals, including clinicians are urged to provide their input on:

  • Whether issuing fit notes is a good use of GP’s time.
  • The challenges and enabling factors for healthcare professionals in having in-depth work and health conversations with individuals requesting fit notes.
  • Whether more detailed advice would be useful on “may be fit for work” notes to support individual’s work and health needs. Also, how those individuals that would benefit from more in-depth conversations and advice about their health can be identified.

You can respond to the call for evidence on behalf of an organisation or as an individual by using the online form.