Bethan Jones
Posted on 27 Oct 2014

Employment Law Monday Update - 27 October

Anyone who works in HR will know how quickly changes come about in Employment Law, and how hard it is to keep up with them all. With that in mind, the Michelmores Employment Team has created a weekly newsletter that encapsulates the most significant Employment Law developments of the last 7 days. The Weekly Update will be sent out around midday on Monday, so be sure to keep an eye out for it!

Set-off is Available as a Defence in Employment Tribunal Contract Claims

Ridge v HM Land Registry [UKEAT/0485/12]

Employees have the right to bring breach of contract or debt claims against their employers in the Employment Tribunal where those claims arise or are in existence on the termination of their employment. Employers have no stand-alone right to bring contract claims against employees in the Tribunal, but may counterclaim against an employee who has brought a contractual claim.

Where two parties owe each other money, a party may exercise a right of set-off to reduce or eliminate its liability to the other party.

The Facts

The claimant was disabled and took repeated short-term periods of sickness between 2007 and his dismissal on 25 October 2010. He brought two separate claims in the Employment Tribunal; one for disability discrimination and another for victimisation.

The claimant subsequently brought another claim which included claims for unfair dismissal, disability discrimination and breach of contract in relation to unpaid pension contributions during his notice period. The employer brought a counterclaim for overpaid wages, which exceeded the amount of the claimant's unpaid pension contributions.

The Employment Tribunal held that the employer's counterclaim for overpaid wages had been submitted out of time; however, the overpayment provided a defence by way of set-off to the claimant's claim for pension contributions.

The claimant appealed to the Employment Appeal Tribunal

The Judgment

The EAT agreed that the defence of set-off is available in the Employment Tribunal and it is not necessary for an employer to raise a valid counterclaim in order to resist an employee's claim on the grounds of set-off.

It is a matter of practical convenience that Employment Tribunals have jurisdiction to hear certain contract claims. Defences that are available in the civil courts should be available in the Tribunal, unless they are expressly restricted.

Tips for Employers

This is the first reported case which confirms that the defence of set-off is available in contracts claims in the Employment Tribunal. The law of contract, including any defences, is intended to work in the same way as it would before the civil courts.

Local Authority Entitled to Suspend Former Teacher Acting as Union Representative

Davies v London Borough of Haringey [2014] EWHC 3393 (QB)

Background

The Education Act 2002 provides that teachers and other members of staff employed to work at a community school will be employed by the local authority.

The School Staffing England Regulations 2009 state that the governing body of the school must establish disciplinary procedures for staff and permit the governing body or head teacher to suspend an employee at the school. However, the governing body may also direct the local authority to dismiss any person employed or engaged by the authority to work at the school.

The Education (Modification of Enactments Relating to Employment) (England) Order 2003 states that, where a governing body exercises its powers under the 2009 Regulations, it shall be treated as the employer for the purposes of any employment claims.

The Facts

The claimant was initially employed by the local authority as a full-time assistant teacher at a maintained community school. In 1997, she was elected as a deputy divisional secretary for the National Union of Teachers ('NUT'). Therefore, she was released from teaching for three days a week to carry out her union activities.

From 2000 onwards, the claimant relinquished all her teaching duties in order that she could carry out her union duties full time. That arrangement continued until 17 July 2014, when she was suspended for breaching the authority's code of conduct and social media policy. The complaints did not relate to the claimant's teaching.

During the period that the claimant had been carrying out her union duties full time, her teaching post at the school had been deleted.

The claimant contended that the local authority had no power to suspend her, or take any disciplinary action against her, as she should be subject to the school's disciplinary policy. The question before the High Court was whether the authority had the right to subject the claimant to disciplinary action or whether only the school had the right to do so.

Judgment

The court held that the claimant's employment contract had been varied, as a result of which the claimant was not, at the time of her suspension, employed as a teacher.

There was no legislative provision that meant the governing body alone could discipline the claimant. In any event, as the claimant's contract had been varied, the 2009 Regulations did not apply and, therefore, the school's disciplinary policy did not apply. Further, the 2003 Order had no effect on the parties' contractual rights; it related to the statutory causes of action.

As a result of the above, the court held that the local authority was entitled to discipline the claimant.

Tips for Employers

This case provides welcome clarification on the purpose of the staffing regulations. It also highlights an example of a circumstance in which the governing body of a maintained school will not be considered the proper respondent in a claim by one of its employees.


Holiday Pay: Cases Following the Decision in Lock v British Gas Trading

In our previous updates, we have discussed the case of Lock v British Gas Trading Ltd (C-539/12), in which the European Court held that commission should be included in the calculation of holiday pay.

ACAS has now reported that 300 group claims concerning holiday pay are currently going through the early conciliation process. It is anticipated that a significant number of claims will progress to Tribunal, whilst others may settle.

If you require further information regarding this, please contact a member of our editorial team.