Employment Law 2019 Review: Another Year Over...

Yet another year dominated by what seems to be the alternative reality of Brexitland. We started the year with Theresa May as Prime Minister, then in came Boris Johnson over the summer, two missed exit dates and finishing the year with an "oh not another one" General Election.

For now, we leave the political uncertainty aside (well as best we can) and instead reflect on our pick of the most memorable 2019 employment cases and developments.

Employment Status: The taX Factor TUPE: The Tatupe Fixer; Just Tatupe of Us Whistleblowing: Master behind the Chef; Master Chef: the Profession; The Great British Broad Menu Trade unions: Deal or no deal; Strike it Unlucky Post termination clause: Strictly Come Drafting Discipline: Stacey Duly Investigates; Suspension Watch; Pan-or-ram-on Dismissal: The Only Way is Exit Privacy: Big Brother; The Voice secretly recorded Data Protection: First Dates; Legal privilege: Don't tell the Judge; Grand Designs go awry Working Time: Extra pay on the Beach; The Great British Break Off; The Great British Break Off: an extra slice Family Friendly: Pay Sync Battle; Who Dare Wins Equal Pay: Supermarket Sweep Harassment: Under(third party)cover Boss Discrimination: The Coffey Maze; Spitting Material Image; The Frosty Medical Report; The Weakish Link; Mastermind; Only Connect to company policy; The Real Housewives of Hendon; Good Morning Britain; Made for Chelsea 1. Employment Status

The taX Factor

Determining worker status in modern workplaces continued to be a hot topic in 2019. Just how do you decide if an individual is an employee or a worker or self-employed when determining employment rights? And how does that fit with employed or self-employed status for tax purposes?

Preparations for the final Supreme Court showdown in the high profile Uber drivers' status dispute have taken some time, so rather than a 2019 hearing, we need to wait until July 2020. We also still await the outcome of the 2018 BEIS and HMRC joint consultation on employment status.

The 2019 employment status hot topic has been IR35 off payroll working. Existing public sector restrictions and rules on IR35 (workers providing services through intermediaries) were announced to be extended to medium and large private sector organisations from 6 April 2020. Under the controversial change, instead of the contractor having responsibility for determining their employment status for tax purposes, the client or hirer will need to make that call. The hirer could be liable for any missing tax if they get the decision wrong. As a result some well-known large employers have announced they are ending contracting with individuals via that individual's Personal Services Company (PSC).

Illustrating just how hard it is to get the tax status correct, 2019 has seen a number of IR35 employment status cases being pursued by HMRC against individuals with mixed results as each case is very fact specific.

Cases in which deemed employee status has been held include:

Paya Limited and others v HMRC (BBC presenters); Christa Ackroyd Media Ltd v HMRC (BBC presenter); Big Bad Wolff Limited v HMRC (actor). Cases in which self-employment status has been held include:

Albatel Limited v HMRC (Loraine Kelly) Atholl House Productions v HMRC (BBC presenter) Canal Street Products Ltd v HMRC (ITV presenter) RALC Consulting Ltd v HMRC (IT consultant) Kickabout Productions Ltd v HMRC (radio presenter) The case of George Mantides Ltd v The Commissioners for Her Majesty's Revenue & Customs provides an interesting illustration of the complexities of the issue. It concerned the supply of services of an urologist under separate contracts to two different hospitals. While the same individual was providing essentially the same services, the set up and operation of the different contracts resulted in different outcomes.

Controversy on just how hard it is to get the tax status call right led to the Conservative, Labour and Liberal Democrat parties announcing that they would review the planned 6 April 2020 changes if elected. Will the change be delayed or even scrapped? HMRC believe many individuals operating through PSCs are not paying the correct tax and estimate the change in enforcement will bring £3.1 billion in additional revenue for the Exchequer between 2020 and 2024. Will the lure of significant additional tax revenue to be too great for the new Government to forego?

2. TUPE

   The Tatupe Fixer

   It is sometimes forgotten that the definition of "employee" under Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) is different to the definition used in the Employment Rights Act 1996 (ERA). This year in Dewhurst v Revisecatch Ltd (t/a Ecourier) and City Sprint, an employment tribunal held, at a preliminary hearing, that the definition of employee under TUPE is wide enough to cover not only "employees" as defined under s230(3)(a) ERA but also "workers" under s 230(3)(b) ERA.

   Three cycle couriers were engaged by City Sprint until it lost its contract to Ecourier. Ecourier then engaged the claimants after that point. The cycle couriers claimed holiday pay under the Working Time Regulations 1998 and failure to inform and consult under TUPE. The tribunal held that so-called "limb (b) workers" are within the definition of employee under TUPE and only independent contractors genuinely in business on their own account are excluded. Although only a non-binding first-instance judgment, it is highly significant as there is no appeal level decision on this point and the practical risks and liabilities for employers are potentially significant. Subject to a future appeal, TUPE to the rescue!

   Just Tatupe of Us

   Also from this year's case law on transfers we have learned:

   The duty under the National Minimum Wage Act 1998 (NMWA) to maintain wage records transfers to the transferee on a relevant transfer falling within the meaning of TUPE 2006 and therefore the transferor employer will no longer be required to maintain such wage records and will not be required to comply with any production notice. Accordingly, a transferee should ensure that all records maintained by the transferor for the purposes of NMWA are delivered to it (Mears Homecare Limited v Bradburn) On an employer's insolvency, arrears of equal pay can be claimed from the National Insurance Fund up to the eight weeks' limit (and subject to the maximum weekly pay cap). Liability for any excess passes to the transferee. One for purchasers of an insolvent business to be aware of (Graysons Restaurants Ltd v Jones and others). Dismissal ostensibly for a dysfunctional working relationship may be TUPE-related. When ascertaining the principal reason for the dismissal, while proximity to the transfer is not conclusive, it is often strong evidence in the employee's favour. In this case, a poor working relationship between two transferring employees had existed for several years. The inference that the transfer rather than the poor relationship in isolation from the transfer was the principal reason for the dismissal was therefore "very strong" (Hare Wines Ltd v Kaur and anor). There can be a business transfer where a production unit is hived off but remains within a business and relies on other parts of the business for the factors of production. The Court of Justice of the European Union gave guidance on the features necessary for the production unit to retain its identity. For the EU rules on business transfers (and TUPE) to apply, a hived-off unit must not be dependent on unilateral decisions of third parties. It must have sufficient safeguards, such as agreements with those third parties to enable it to function on its own post-transfer. (Ellinika Nafpigeia v Panagiotis Anagnostopoulos and ors). 3. Whistleblowing

   Master behind the Chef

   Where an employee is dismissed, it will be automatically unfair if the principal reason for the decision to dismiss was that they made a protected public interest disclosure. But what if the decision-maker is being manipulated by another? In the case of Royal Mail Ltd v Jhuti, the dismissing officer was unwittingly misled by the employee's line manager.

   In 2017, the Court of Appeal held that it is only the mental processes of the person or persons who was or were authorised to, and did, take the decision to dismiss that are relevant. However, in one of the 'must read' judgments of the year, the Supreme Court has unanimously confirmed that an employer is liable for the reasons of any manipulator in the "hierarchy of responsibility above the employee" even where that reason is hidden from the decision-maker(s). The improper actions or motive of a line manager will therefore be attributed to the employer. In other words, if a line manager determines that he or she should be dismissed for one reason, but hides it behind an invented reason which the decision-maker adopts, the reason for the dismissal is the hidden (unfair) reason rather than the invented reason.

   Master Chef: the Profession

   For a disclosure to be a qualifying disclosure under the whistleblowing legislative provisions, the worker must have:

   a reasonable belief that the information disclosed tends to show one of the six potential 'relevant failures' (including a 'breach of any legal obligation') has occurred, is occurring, or is likely to occur; and (since 2013) a reasonable belief that 'it is made in the public interest'. This year, we have further examples indicating that the bar to establish reasonable belief is set low.

   In Ibrahim v HCA International Ltd (disclosures of alleged defamation of the worker), the Court of Appeal reminds us that while the worker must have a genuine and reasonable belief that the disclosure is in the public interest, that does not have to be their predominant motive for making it. It is possible for a disclosure motivated by personal self-interest to nevertheless still also to be made in the "public interest".

   Also Elysium Healthcare No 2 Ltd v Ogunlami (disclosure of...