Evaluating Fairness of Dismissal: Employer's Reasonableness, Study notes of Business

Download Evaluating Fairness of Dismissal: Employer's Reasonableness and more Study notes Business in PDF only on Docsity! Case Number: 3200228/2017 RM EMPLOYMENT TRIBUNALS Claimant: Mrs Christabel Palmer Respondent: Our Lady of Grace Academy Trust Heard at: East London Hearing Centre On: 19 and 20 April 2018 Before: Employment Judge Tobin Representation Claimant: Mr P Palmer (husband) Respondent: Mr K Allen (counsel) RESERVED JUDGMENT 1. The claimant was unfairly dismissed. 2. Any compensation awarded is reduced by as Polkey reduction of 50% of the claimant’s loss of earnings, such losses to be awarded for a period of up to one year. REASONS The case 3. The case was summarised by Employment Judge Ferguson in her Record of Preliminary Hearing of 15 December 2017 (promulgated to the parties on 3 January 2018). The issues identified by EJ Ferguson were as follows: 1. Has the respondent shown that the reason for the dismissal was a potentially fair reason under s98 Employment Rights Act 1996? 2. If so, did the respondent act reasonably in all of the circumstances in treating that reason as a sufficient reason for dismissing the claimant? Case Number: 3200228/2017 2 3. If the dismissal was procedurally unfair, what adjustment, if any, should be made to any compensatory award to reflect the possibility that the claimant would still have been dismissed had a fair and reasonable procedure been followed? See: Polkey v A E Dayton Services Ltd [1987] UKHL 8; paragraph 54 or Software 2000 Ltd v Andrews [2007] ICR 825. The law 4. The claimant contended that she was unfairly dismissed, in contravention of section 94 Employment Rights Act 1996 (“ERA”). 5. Section 98 ERA sets out how an Employment Tribunal should approach the question of whether a dismissal is fair. First, the employer must show the reason for the dismissal. The employer must satisfy the Employment Tribunal that this reason was one of the potentially fair reasons set out in s98(1) & s98(2) ERA 1996. Finally, the employment tribunal must assess whether the employer handled the dismissal fairly in treating that reason as a sufficient reason for dismissal as under s98(4): Where the employer has fulfilled the requirements of subsection (1), the determination of the question of whether the dismissal is fair or unfair (having regard to the reason shown by the employer) – (a) depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee, and (b) shall be determined in accordance with equity and the substantial merits of the case. 6. The claimant was dismissed because she would not agree to accept a new contract for a Teaching Assistant pursuant to the single status harmonisation process which was applied across the London Borough of Newham. The respondent’s proposal to move the claimant entailed a reduction in her salary of up to £2,956 (gross) with a one-off compensation payment of £3,980. The claimant rejected the respondent’s proposal and was dismissed as a result. She was paid a “redundancy payment”. The respondent contends that the claimant was dismissed for a compelling business reason which amounted to “some other substantial reason of a kind such as to justify the dismissal of an employee holding the position which the employee held” (pursuant to s98(1)(b) ERA 1996). The respondent contended that, in the alternative, the claimant had been dismissed by reason of redundancy. This was not a redundancy dismissal as set out below and this determination will not set out the law in respect of redundancy dismissals so as to avoid any possible confusion. 7. Some other substantial reason (or SOSR) is often invoked where an employer is trying to reorganise their business and/or change the terms and conditions of employment in some way. The respondent has specifically pleaded that the claimant’s dismissal was necessitated by her refusal to accept a variation to her contract to bring her contractual terms in line with other employees undertaking work of the same kind as the claimant. 8. Employment Tribunals have long recognised the rights of employers to dismiss employees who refuse to go along with business and contractual changes. As Lord Denning MR put it in Lesney Products and Co Ltd v Nolan and others 1977 IRLR 77 CA “it is important that nothing should be done to impair the Case Number: 3200228/2017 5 “Nature of [her] Employment” as a Nursery Nurse. No further elaboration was provided. The claimant was not issued with a job description and the contract of employment made no reference to a job description. The claimant was employed for 32½ hours per week for 52 weeks per annum. The contract also provided for the claimant to keep her SEN Allowance in order for the claimant to work with any future pupils with special needs. The contract specifically identified that the claimant’s terms and conditions of employment were in accordance with the National Joint Counsel for Local Government Services (The Green Book). 19. St Joachim’s was formally a voluntary aided school maintained by the local education authority, which then converted to an academy and joined the respondent’s multi-Academy Trust on 1 April 2015. 20. In or around March 2007 the local authority and the recognised trade unions came to an agreement on “single status”. This harmonised terms and conditions of employment across the London Borough of Newham and was aimed at addressing potential pay inequality and settling historic pay discrimination claims and potential equal pay discrimination claims. The London Borough of Newham’s agreement led to harmonisation across all manual and support staff, which included the claimant’s role. This led to the implement of the Newham Agreement as part of the National Agreement on Pay and Conditions (i.e. the Green Book). 21. The Newham Partnership Working (NPW) provided HR support to the respondent’s school. NPW had extensive experience in implementing the single status agreement as they had been engaged in rolling out the job evaluation and grading of support staff from 2007. Indeed, NPW had evaluated the Teaching Assistant’s role as far back as May 2007. 22. From September 2007 the claimant had stopped working in the nursery at St Joachim’s School. This was because many functions fulfilled by the Nursery Nurse – as set out in the job description subsequently produced – were undertaken by a senior school teacher who undertook the role as Nursery Teacher. The Nursery Teacher’s role included: nursery supervision, planning activities, training nursery nurse students, and liaising with other agencies. Mr Allen, said in evidence, that the claimant was moved from the nursery because of a personality clash. The claimant disputed this and said that she moved because of operational requirements. I did not need to resolve this dispute; however, I find the claimant’s response more credible in view of the introduction of a Nursery Teacher. 23. Although the claimant continued to work in the nursery on occasion (i.e. to cover staff shortages and other absences), I accept Mr Allen’s evidence that the claimant worked with infants and primary school children at key stage 1 level (year 1 and year 2) as this was identified in various organisational charts in the school handbook for the years following September 2007. 24. The claimant began intervention work with individuals and small groups of pupils on a more structured basis from September 2012. This entailed the claimant working with children for whom the school had identified required Case Number: 3200228/2017 6 educational support, for example, extra reading or additional teaching support. The school did not have any children with special educational needs as identified in a statutory statement, or latterly, an Education, Health and Care Plan so the claimant was not trained in specialist speech and language or other therapy (which is generally provided by more specialist Teaching Assistants). 25. During September 2013 NPW commenced a job evaluation scheme (JES) across maintained schools in Newham as part of the second phase of the single status harmonisation process. Chris French (Head of Schools HR – NPW) wrote to all Nursery Nurses in Newham, stating that the final phase of the single status harmonisation process needed to be carried out and that a new agreed JES was to be applied to staff who had not had their posts evaluated since December 2006. Ms French stated: Over the next few weeks, you will shortly be given a generic job description for your role by your Head teacher. The Head teacher (or their nominee) will arrange to meet with you to go through your job description and consult with you as to whether it accurately reflects your role since 1st April 2010. We will also harmonise your conditions service with the rest of the support staff. This means that you would move to Scale 4 (points 18 to 21) with pro rata salary, as for all other term time employees. As you are aware, the current national grade is points 7-15, working 32.5 hours per week, term time, but you are paid as a full-time employee. 26. As part of the JES, Mr Allen met with the claimant to review her role in November 2014. During their meeting, Mr Allen and the claimant reviewed the job descriptions for a Nursery Nurse and a Teaching Assistant. They agreed a job description to reflect the actual role that she was carrying out in her day-to- day activities. The documents were then sent to NPW to assess the claimant’s grade, pursuant to the requirements set out in the harmonisation process and the Green Book implementation. Although the claimant was the only Nursery Nurse at the school, this was part of the same process that Mr Allen had followed in respect of other categories of support staff at the school. 27. After some unaccounted delay, in March 2015, NPW reviewed the claimant’s job descriptions and determined that she should be re-graded as a Teaching Assistant as this reflected the work that the claimant had undertaken for some considerable time. In December 2015, Ms Howard, produced figures identifying how the proposed changes would affect the claimant.  The claimant was paid on a Nursery Nurse grade of Scale 3, point 17 for 52 weeks per annum and 32.5 hours per week. Taken account of her nursery nurse allowance a total salary was £20,359 per annum.  The Teaching Assistant contract would place the claimant at Scale 3, point 20 for 46.51 weeks pa, working 39 weeks per year at 32.5 hours per week. This worked out at £16,840.50 pa. As the claimant would lose her nursery allowance, Ms Howard proposed putting her on Scale 4, point 21, which would give her a salary of £17,403. This gave a shortfall (or potential wage cut) of £2,956 pa. The claimant was entitled to some compensation under this single status agreement, which worked out at the maximum £3,980. Case Number: 3200228/2017 7 28. On 26 January 2016 Mr Allen and Ms Howard met with the claimant to discuss the proposed changes to her terms and conditions of service, specifically, her job role. The claimant was accompanied by her trade union representative, Mr Tim Linehan of the GMB. At this meeting the claimant said she did not want a Teaching Assistant contract and she would not accept a reduction of about £3,000 to her salary. The claimant said that if necessary she would return to work in the nursery. Mr Allen was quite clear that the claimant was not required to work as nursery nurse and that she did “a fantastic job with the interventions.” Mr Allen said that the implementation of the single status agreement was not optional as it was agreed between the unions and the local authority and that the school had remained in line with Newham Pay Policy since becoming an academy. Ms Howard proposed to do the following:  1st stage – she would “do the single status for Nursery Nurses” so that the claimant could see what her salary would be. [This was already done.]  2nd stage – look at the claimant’s job description. [This was already done.]  Ms Howard invited the claimant to write down all her current roles and responsibilities for evaluation. [Again, this was already done.] 29. Mr Allen wrote to the claimant on 17 April 2016, inviting her to a further meeting. Mr Allen set out the claimant’s current pay arrangements and confirmed “under the single status agreements this arrangement no longer exists,”. He set out the new arrangements for Nursery Nurses and then said, “we no longer have a role for a Nursery Nurse, and as you have been working as a Teaching Assistant for around 7 years, we propose that a permanent arrangement is made to reflect the work you currently do.” He then set out two proposals, which were essentially the same package with a choice of working either 32.5 hours or 36 hours per week. 30. On 24 February 2016 a second consultation meeting was held. The attendees were the same as the previous meeting. Ms Howard re-sated the claimant’s pay details (which were those identified in the first bullet point of paragraph 26 above and also in Mr Allen’s letter of 12 February 2016). Mr Allen reiterated the respondent’s position that it was unreasonable for the claimant to be paid for a role she did not undertake and there was no current Nursery Nurse position available in the school. Ms Howard set out the respondent’s proposals, which was substantially in accordance with the second bullet point in paragraph 26 above, Ms Howard advised the claimant that she would be made “redundant” if she did not remain in the role she was in at present and be paid as a Teaching Assistant. She gave the claimant two options: either work 32.5 hours per week on a salary of £17,403 pa or work for 36 hours per week on a salary of £18,654 pa. Both options attracted a one-off payment of £3,980. Ms Howard said that as a “goodwill gesture” by the Headteacher, she would not backdate the proposed pay cut to April of the preceding year, but that it would start from 1 April 2016. Ms Howard ignored the claimant’s notice period for such contractual changes. Ms Howard similarly did not set out the basis on which she thought she was entitled to apply retrospectively what was effectively the claimant’s pay cut. Mr Allen said repeatedly that the respondent would offer a “compromise” so as not to affect the pay cut from April 2015. The claimant made her position quite clear at this meeting – she would not accept a pay cut. Case Number: 3200228/2017 10 abrogated his responsibilities to properly investigate and/or determine the claimant’s grievance. Given his position as Chairman of the Board of Governors, this was a significant failing. 43. Nevertheless, (despite adopting an accusatory tone) Mr Coleman did articulate the respondent’s reason for making such changes when he said: … The single status process started before we converted to an Academy. We agreed when converting that we will continue as we were and not make any changes, this also included continuing with the single status rollout. You have been paid as a Nursery Nurse with the old terms and conditions for the last 7 years, even though you were not carrying out the role of a Nursery Nurse. The process came to St Joachim’s and you are the last person to complete the process. … you were offered to alternatives… By not accepting these offers; you were in effect, refusing to accept a role within the school, thus making yourself redundant. Therefore, the School began the redundancy process. During this process you had ample opportunity to accept the offers you have been made, but we receive no response. It is sad that your many years loyal service have ended this way; however this is something you have chosen to do… 44. Having her appeal against dismissal ignored by the respondent, the claimant instigated a further and formal grievance on 10 July 2016. This grievance was also ignored by the respondent. No response was ever sent to the claimant . My determination of the issues 45. The wording of s98(1)(b) ERA, which refers to the act of justifying the dismissal of an employee, not the employee, so the whole picture has to be examined, not just the position of the affected employee. 46. No one factor is given greater weight than another, and the whole context needs to be examined: see St John of God (Care Services) Ltd v Brooks [1992] IRLR 546. Factors to consider are: a. The reason for the proposed changes. b. The effect of a pay cut on the claimant. c. What is the balance of advantages and disadvantages to both parties. d. Whether the employer consulted with the claimant, and any employee representatives; e. Whether the employer considered alternative courses of action; f. Whether the changes were those that a reasonable employer would offer; g. Whether the majority of employees have accepted the change. 47. The Tribunal is not allowed to second-guess the employer’s business or organisational objectives, so the respondent could establish a “fair reason” relatively easily. The respondent’s reason for embarking upon this course arose from the implementation of a fair pay system across the London Borough of Newham, which had been agreed with the recognised trade unions and entailed a job evaluation. The claimant’s job evaluation highlighted an anomaly in that the claimant was paid as a Nursery Nurse, yet she was undertaken the role of a Teaching Assistant. The respondent chose to deal with this anomaly and pay the claimant the correct wages for the job that she, in fact, undertook. Case Number: 3200228/2017 11 48. The employer is not required to demonstrate that there was a “pressing business need” for the change or even that the change could be demonstrated as advantageous. The respondent merely needs to establish that there is a sound reason: see Hollister v National Farmers Union [1979] ICR 542 or even merely that the change was beneficial to the organisation: see SW Global Resourcing Limited v Doherty [2012] IRLR 727. 49. A pay cut of almost 15% is substantial. For a relatively low-paid employee earning £20,359, a reduction of £2,956 (gross) is a considerable shortfall. The respondent has never disputed the deep financial concerns which the claimant articulated at the hearing. Nevertheless, the potential hardship for the claimant was one factor – albeit a significant factor – that needed to be set against other matters. 50. The respondent would not receive a particularly significant financial benefit from changing the claimant’s contract. The matter was more of principle than financial benefit and centred on implementing a regularised, fair and non- discriminatory pay system. In this regard, there was no alternative course of action, save as the modification to include the compensatory payment which was agreed with the trade unions. 51. Addressing unequal pay and implementing a fair and transparent pay system across the local authority is a laudable aim. Although the respondent was an academy and outside the control of the local authority, its decision to implement the outstanding pay harmonisation process that had been underway for some time was rational and consistent with good employment practices. This is consistent with the decision that a reasonable employer would make. 52. I did not hear evidence as to how other Nursery Nurses had responded to the single status harmonisation. The claimant was the only Nursery Nurse at the respondent school. So therefore, I can make no determination to whether others have accepted or resisted such changes. 53. Given that the respondent had a good or sound business reason to compel these changes, and that they were in implementation of a fair and non- discriminatory pay structure, even taking into account the financial hardship to the claimant – which I find would be substantial – I determine that the reason given for the claimant’s dismissal, namely some other substantial reason was a potentially fair one. 54. The claimant’s contract of employment identified her as a Nursery Nurse, yet she undertook the role of a Teaching Assistant. That was her “work of a particular kind”. The respondent experienced no reduction in the need for the work of a particular kind undertaken by the claimant (i.e. the Teaching Assistant role) so this was not a redundancy dismissal. If it was a redundancy dismissal case, then I am not sure whether the respondent sufficiently explored any suitable alternative employment options available for the claimant because Ms Howard did not canvass whether there were Nursery Nurse vacancies elsewhere in Newham or explain to the claimant why she could not transfer to any Nursery Nurse vacancy in a local authority-maintained school. Case Number: 3200228/2017 12 55. As there are good business reasons for the change in the claimant’s terms and conditions of service, the respondent has established SOSR as the potentially fair reason for dismissal – under s98(1)(b) ERA – in respect of an employee who refuses to accept such change. However, this is only part of the fairness test. Under s98(4) ERA the Tribunal must also consider the reasonableness of the dismissal process. This involves considering whether, in all of the circumstances, including the employer’s size and administrative resources, the employer acted reasonably in treating the business reason as sufficient reason to dismiss. 56. However, as with any unfair dismissal claim, the manner in which the employer handled the dismissal is still important in considering whether the respondent acted reasonably in all of the circumstances in treating that reason as a sufficient reason for dismissing the claimant. A Tribunal will therefore be keen to find out that the process which led to the claimant’s dismissal was affected in an appropriate way, i.e. within the range of reasonable responses applicable to an employer of the size of the respondent with such administrative resources available. 57. The respondent sought to vary the claimant’s contract of employment so contractual considerations are key to the statutory analysis. Under contract law an employer (or employee) is not entitled to vary a contract unilaterally. The contract can be varied either by individual agreement or through the use of collective agreements. Although the respondent has argued that they reached an agreement on single status with the trade unions, Mr Allen did not pursue, nor indeed argue, that the collective agreement entitled the respondent to amend the claimant’s contract of employment. When wanting to change an employee’s terms and conditions of service, the well-worn – and obvious path – to deal with such eventuality is as follows: a. The respondent should set out the proposed changes to the claimant’s contract of employment and the reasons for these. b. The respondent should then consult with the employee about such changes (and such consultation ought to be meaningful). c. If an agreement cannot be achieved, then the respondent should terminate the claimant’s employment on proper notice and offer immediate re-engagement on the new terms. If the employee still refuses to accept this option, the employer will then need to justify its reasons and process in any ensuing unfair dismissal claim. 58. Not only is this an established process, it is the process that any reasonable employer of this size and administrative resources would follow. 59. The respondent followed 57(a) and (b). 60. Mr Allen was clear and decisive following the first consultation meeting when he wrote to the claimant on 17 April 2016. However, I am puzzled by Ms Howard’s proposals at the meeting of 26 January 2016 (stated above), because this work had already been undertaken. This appears to be the stage that the claimant had lost faith with NPW’s input, and that is entirely understandable. I cannot understand why Ms Howard suggested that