Mark McAllister's Employment Law Revision Day: Top 5 Cases from 2020 & Developments for 2021

Posted in : Supplementary Articles NI on 29 January 2021
Mark McAllister
Labour Relations Agency
Issues covered:

In this webinar recording, Director of Employment Relations Services at the Labour Relations Agency, Mark McAllister, joins Head of Learning & Development at Legal Island, Scott Alexander, to discuss the top 5 employment cases of the year. 

Each case review covers:

  • A short discussion on the facts and background in the case
  • A short discussion on the decision and why it’s important to you
  • Recommended actions as a result of the decision


Mark discusses employment law developments for 2021:

  • Post-Brexit reform agenda GB
  • Employment Bill 2021
  • NI Protocol Article 2 compliance and the DMU
  • Supreme court pending – Mencap, UBER, Agnew and other holiday cases
  • Policy direction for NI?

The Recording


Scott: Good morning, everybody. You're looking at a picture of a man who's not speaking and you're hearing a man that is speaking. I'm Scott Alexander, I'm from Legal-Island, and the man that just raised his hand is, of course, Mark McAllister, who is the Director of Employment Relations Services at the Labour Relations Agency.

My camera is off because my Wi-Fi in sunny Lurgan is not as good as it is in The Big Smoke there where Mark is. His camera is on. You'll be hearing a little voice ask him some questions on your behalf.

If it's the first time that you've joined us for a webinar, have a look on your right-hand side and you'll see a little question box. So if you have any questions, send them in, I'll read them out on your behalf anonymously, and we'll put them to Mark as we go through.

This is kind of a follow-up to the Annual Review of Employment Law. If you've been to one of those in the past, you'll know that Mark starts them off and finishes them by looking back at the previous year and ahead to the following year. Got it completely wrong in the beginning of 2020, so hopefully, you'll get it right this month.

Before we get on to the webinar proper, there's a little ad there for something that's starting next week. It's a whole new event from Legal-Island. Again, if you attended the Annual Review, you might've been at Michelle Halloran's session on the use of language to minimise conflicts. She's set up a new series of workshops, Reskilling HR for the Virtual Employee. It's online and it covers over three half-days. It's got things like interviewing online, onboarding and offboarding, obviously remote workers' probation and remote workers' performance management, and discipline and conflict.

If you want to hear more about that, type yes into the question box and we will directly get back to you. We'll send you a link to everybody anyway, but if you specifically want to hear more about that, then send that and we will get somebody to get in touch with you after the event.

And I've got somebody saying they've got no sound yet. You're not going to be able to hear me, but do check the sound settings and have a look at the chatbox we just got there.

So we're seeing a few yeses come in. Thank you very much for people that want to hear more about that particular course that we have starting next week.

Today, we are going to be looking at two aspects. We're going to be looking at things that are going to be coming up in the next year, Mark, and we're going to be looking at your top five cases. Now, you covered more in the Annual Review, but we're going to look at five particular ones, all with messages for the listeners today as employers or, indeed, trade union representatives or HR professionals. All the lessons there.

So, really, just with each of the cases, I'm going to ask you to give a little bit of the background, tell the listeners why it's important, and then maybe give them an idea about what they should do as a result of this case having been heard, subject to any appeal that might happen.

So, over to you, Mark.

Dismissal for Reputational Risk

Mark: Thanks very much, Scott. Hello, everybody, and welcome. We're going to take a look at these five cases and we'll walk through some of the major points.

In Lafferty and Nuffield Health, this case was essentially about a porter who worked in a hospital, a charitable trust hospital, Nuffield Health, and with 20 years' unblemished service. He was charged with attempted rape and his employer had the choice between putting him on a long, indefinite paid suspension or dismissing him for some other substantial reason.

And this is quite an interesting case because there's a fair amount of case law with regard to criminal convictions and the effect on employment and frustration of contract and all of those things. But this is an interesting case because the individual had yet to be convicted. So he was charged with it and he was on bail. He told his employer exactly what had happened. He was confident that he would be able to defeat the case and become vindicated. The employer then was left with the choice, "Do we suspend this person indefinitely or do we dismiss on some other substantial reason?"

At the heart of the case was the employer's reputational risk. This is what the employer was primarily concerned about, the reputational risk given that it was a charity, given that the alleged offence was sexual in nature, given that him as a porter, one of the primary roles was to move patients who were under anaesthetic between theatre and wards, and the various risks associated with that.

The decision was to dismiss him, and he took a case for unfair dismissal, and lost his case at tribunal and lost it at EAT level as well, because the facts of the case were such that the EAT felt that there was a significant reputational risk.

We see more and more of these sorts of cases coming through the industrial tribunal in Northern Ireland where the employer is arguing that there is reputational risk. And a lot of them will point to the fact that they have a risk register, and they point to the fact that if they suffer damage to their reputation, the net effect of that could be very, very serious.

It can be a bit of a nebulous area because a lot of employers sometimes rely on the whole notion about bringing the organisation into disrepute, and that can be a thorny and difficult to establish how reasonable that is. And you'll see that certainly in regard to things like social media dismissals, social-media-related posts, external social media posts, where someone is dismissed for that. The tribunals now are more geared towards looking at things, "Well, look, what were the privacy settings? How many views did it have before it was taken down?" etc. So they're willing to drill down into the facts of the case to see whether or not the employer is being unreasonable or reasonable.

In this particular case, they deemed the dismissal to be fair. It fell within, as we talk about, the band of reasonable responses. And we tend to look at the band of reasonable responses purely in the context of misconduct dismissals, but the reality is some other substantial reason is a far less utilised route for dismissal, but still is subject to that notion of "Did it fall within the band of reasonable responses?" And such dismissals would obviously attract the attention of things like, in England, obviously, the Acas Code and stuff like that.

So that's probably the basis of the case, and I think the thing to look at applying it in your own organisations is do you have a risk register? What issues do you have around reputational risk? Do you consider SOSR as a mode of termination of contract for dismissal?

And it's important to be able to categorise the reason for the dismissal very, very clearly. One of the biggest complaints that the tribunal would have for employers in Northern Ireland is where you start a case that's maybe a misconduct dismissal, and then becomes a capability reason or some other substantial reason. The tribunal chairs, or judges as they're now referred to, are very, very clear that you must ride one horse in terms of what the reason for dismissal is.

So an interesting case. A few fact sensitivities, including where there was an arrangement in this case where the individual had spoken to the HR manager after the investigation, etc., and the HR manager gave a commitment that in the event that he was acquitted after the trial, they would give him his job back and keep his continuity of employment intact. But he decided to take an unfair dismissal case when he was dismissed first time around. So interesting case. Well worth a read.

Scott: I suppose the lesson there is decide early on, Mark, which route you're going to go down. If it's not in your disciplinary procedure, you still have the option of saying, "Look, it's a big enough thing here".

I suppose in the past a lot of the case law would have been around customers pressurising somebody to dismiss a specific employee because they'd fallen out. And it's not so much that the employee did anything wrong. It's just the customer is more important than the employee would be.

…sense of those types of things. It's going to have an impact on the business. We're not saying it's a disciplinary issue, but it's substantial enough, and I suppose that SOSR, the S, the substantial part, is really quite important there as well. It's not a minor issue. It has to be big.

Mark: No, that's right. There's a variety of context that that can be applied into, but absolutely, it has to be substantial. That's where the reasonableness aspect comes into it, to make sure that there is a definitive case there to argue that it is a substantial reason for the dismissal. So you see it in a variety of other contexts.

And as I say, I wouldn't say there's necessarily a dearth of case law on it, but there's certainly nowhere near as much as there would be for misconduct dismissals.

Scott: Yeah, and I suppose with the SOSR reasons for dismissal, you'd have to give notice most of the time as well.

Mark: Yeah, because you're into the realms of contract. And as you give an example there, Scott, there are issues with regard to things like third-party pressure to dismiss and stuff like that.

So to give you an example years ago that would've come up, say, for example, you have a male member of staff in a predominantly female work environment who is charged with domestic abuse, but had not yet to be convicted and is on bail, and there's a collective grievance by those female staff to say, "We don't feel it's safe with this individual in the workplace because he has this potential conviction hanging over him". That puts the employer in a very, very invidious position because it's an external event, but he has a duty of care to the existing staff members.

And so you could think of a variety of contexts where this sort of thing may arise, and the SOSR dismissal may be the avenue that the employer goes down.

Scott: Okay. Thank you very much. If you're just joining us, that's Mark McAllister on the screen. I'm Scott Alexander from Legal-Island. He's from the LRA and he's going through his top cases from the last year or so.

Now, just a question in there, Mark. Was the colleague found guilty of rape? Do you know?

Mark: He was acquitted. He was acquitted, and had he not taken the unfair dismissal case, he would have got his job back with his continuity intact and he would've continued as is. But given the circumstances and the issue at the heart of it, the HR team were more than reasonable about it because they had said, "Look, we can give you this, but we're not going down the route of an indefinite suspension because we're a charity and we couldn't afford it, and there is a reputational risk. So we'll dismiss you, but if you're acquitted, we'll take you back, and it's as if the dismissal had vanished there".

So that's really unusual, I suppose, and it's a very good question. So, yeah, he was acquitted, and had he not taken the case, he would've gone back to work.

Dismissal for Some Other Substantial Reason

Scott: Okay. The second case is Gallacher against Abellio Scotrail. So tell us about that. That's an unusual case as well.

Mark: It is an unusual case, and I'm telling practitioners now to place no reliance on this case whatsoever, because it's the fact it's the unusualness of the case that probably brought it to my attention. This was effectively a dismissal where no procedure was followed whatsoever.

Now, in England and Wales and Scotland, obviously, with the repeal of the statutory dispute resolution regulations and Acas Code . . . and in Northern Ireland, you still have, obviously, the dismissal procedure embedded in legislation and you have the LRA code. This was a working relationship that just fundamentally broke down and had been broken for some time and there had been no procedures followed whatsoever.

And so, effectively, what happened was the relationship between a line manager and the person who worked under her was fundamentally destroyed by virtue of the fact that there was a complete lack of trust and confidence. It was a dismissal on the grounds of some other substantial reason following the breakdown of that work relationship.

And the working relationship was central to the efficiency of the organisation. So even though there hadn't been the statutory one, two, three, or in GB, following the Acas code, and there had been no sort of advanced maintenance, etc., the EAT, when it went to EAT, found that actually to invoke any sort of internal procedure would have been futile and would've made a bad situation worse.

So, on the facts of this specific case, they said this was a fair SOSR reason, some other substantial reason dismissal, despite the fact that there was absolutely no procedure followed.

And so it's with a health warning I raise this case. Don't rely on it if you have a case like this. But there are a few cases that exist at EAT level in GB where working relationships have fundamentally broken down and that were the basis of a dismissal, but they normally have followed processes and protocols and procedures.

So it's not unusual to have an SOSR dismissal relating to a fundamental breakdown in working relationships, but normally and advisedly, they would always have followed at least the one, two, three and followed the provisions of the code of practice, either in Acas across the water, or the LRA code here in Northern Ireland.

So, yeah, interesting case in that regard, but certainly not one to rely on, Scott.

Scott: Okay. Thanks very much, Mark. Yeah, it's interesting there that you've got two some other substantial reasons, so it doesn't fit into conduct or capability or redundancy or statutory ban-type things.

What you're saying is, look, you can still dismiss, but it's really dangerous just to say, "We've had enough", because there would have been stages when that relationship was going wrong that they could have taken to correct it. And in fact, your organisation does an awful lot that, or did an awful lot of that before the lockdown, in terms of mediation and trying to fix relationships and put them back together where people were still working.

So there would have been opportunities there to have carried it out. But even if you're getting to the stage of saying, "Look, we've had enough of you two. One of you is going", that still requires some kind of fair procedure in order to make a fair dismissal at the end of it, especially if you've got long-standing employees like this one.

Mark: Yes, that's exactly the case. This is really an exception to the rule. It shows you the difficulty of leaving a bad working relationship to fester, and where it becomes . . . you hear the language of the courts always talking about how the relationship has fundamentally broken down or there's a fundamental breach of the implied duty of trust and confidence. When you're at that stage, services like ours in terms of mediation are probably not going to be that useful because the positions have become so entrenched and the parties are just so far apart.

And it was said by the EAT, in fact, invoking a procedure at this late stage where the relationship was so fundamentally broken down would actually have made a bad situation worse, and it's completely futile.

Employment Status – Foster Carers

Scott: Okay. Glasgow City Council against Johnstone, what's that all about, Mark? Why are you talking about this one?

Mark: I'm talking about this one because this is a case that pertains to . . . and I know Seamus McGranaghan was talking about this a couple weeks ago in terms of employment status. Employment status cases have tended to focus in recent years on plumbers and couriers and digital platform taxi drivers, and they're the ones that are most sort of well known. This case involved foster carers and the employment status of foster carers.

Now, the caveat in this one was it relates to Scottish law, which is in many areas, and no offence to you, Scott, especially around contract and some of the statute, is very different from the rest of the UK. But the question at the heart of this was "Is the relationship between foster carers under what was called a multi-treatment foster care arrangement enough to warrant it being defined as an employment contract?"

And this was quite an interesting one because the foster carers in this case under this multi-treatment, this MTFC agreement with the local authority, Glasgow Council, was both controlled by statute on one hand, but also this agreement on another. The content of the agreement and how that agreement was written lent itself for the EAT to be able to say, "This is a relationship that is commensurate with a contract of employment".

There was a fee of £30,000 pounds, which was effectively the remuneration, and there was a degree of control exercised by Glasgow City Council in this particular case in terms of the protocols and provisions regarding the foster care arrangement, and that covered everything, like certain expenses. Holiday pay as well was involved in it, and the ability for the foster carers to go on holiday without the child that they were fostering. So there was a combination of factors which all of us would recognise as being applied by the industrial tribunal. So there was control. The control test was at the centre of this.

And this is one of the things that when you look at the Pimlico Plumber case, and the Uber case, and all of the gig economy cases that we have seen, despite the fact that the control test was devised by the courts in the 19th century and had gone off the radar for many, many years, in the last seven or eight years, the control test has seen a bit of a renaissance because it's the one that applies most commonly to these gig economy cases.

The exercise and the amount of control that the employer has over the individual would indicate that the relationship is either at least a worker or, as in this case, because of the contents of the contract, they were deemed to be employees.

Now, it's a bit fact-sensitive and it's because a fair bit of the written agreement is couched in contract that relates to Scots' law, but nonetheless, they were deemed at Scottish EAT level to be employees of the Council.

I think the important thing to remember is lots of people who have workers on their books, sometimes there could be a question mark hanging over their status. And the whole issue about workers and zero-hours workers is going to be formally in the focus of any reforms that are coming down the tracks, and we'll talk about that a bit later on.

The Northern Ireland programme for government consultation document, which was launched this week, specifically mentions some form of regulation for zero-hours contracts. So it'll be interesting to see whether or not that's picked up upon at a policy level towards the tail end of this current electoral mandate.

Scott: For the listeners, I suppose, Mark, the lesson is that they really should be looking at the relationships they have with what they might term non-employees. In this case, you had foster carers who were caring a function on behalf of the Council, pretty much at arm's length, but because of the controls that were put in there, they end up coming into the category.

We've got the IR35 rules coming in later on in April this year. So, again, lots and lots of so-called self-employed people employed through their own little company, if you like, you have to look at those, or the employer is going to be caught out.

But just in general, don't assume just because somebody's an agency worker or a part-time worker or a bank worker or whatever it happens to be . . . it's those nonstandard categories that are catching employers out.

Mark: It is.

Scott: And we'll be chatting about Uber in part. It's just an issue that's going to be coming to the fore. So, really, look at all of the relationships you have and whether they're employees or not.

Mark: Absolutely. The net is closing on disguised employment from a variety of avenues: IR35, tax law, case law, changes in statute. So disguised employment is becoming under increasing scrutiny.

And one of the things that you'll see that's a similar thread through all of these cases is the difference between what's happening in practice and what's said on paper. Because one of the supplementary documents in this foster carer arrangement stated in black and white that you are considered to be self-employed. Now, that didn't cut any ice with the EAT despite the fact it's sitting there in black and white that you're deemed to be self-employed.

The control exercised and contained within the other contractual documents overruled that, and I think that's important to look at that, because in the past, lawyers would have relied very, very heavily about what's written in the contract. And since cases like Autoclenz and Belcher came along, it's now very clear that the courts and tribunals are prepared to lift the veil of the contract to see what's happening in practice.

The net is closing. Like you say, IR35 in April, massive reform. Again, flying beneath the radar. Lots of people may be not aware of it, but employers who are looking at trying to avoid their own contingent possible tax liabilities, the first protocol is if there's any doubt at all, you're just going to classify contractors as employees and bring them in under the rules. It's incumbent upon the individual to say, "No, I've been incorrectly categorised", and then you're into the whole CEST HMRC tax, the online tools, etc., and the difficulties of being faced with that.

Scott: Okay. Thank you very much. We had a question there kind of related to the Gallacher case. "Do the LRA still carry out non-ET1 agreements" . . . millions, I think, is the answer there . . . "between employees and employers? Can they use that route if management wants to terminate someone without process, such as the Gallacher and Scotrail case?"

And the questioner adds . . . because these are all anonymous, obviously. The question is, "I am getting from management and not aligned to my own views". So it's not the kind of thing where it's broken down, you've terminated one of the contracts, and the listeners here could approach the LRA and say, "Look, if we can get both sides together, can you do a non-ET agreement?"

Mark: Ultimately, if it facilitates an agreement, what we will not do is rubberstamp management trying to force somebody out of an organisation, because that's just not our role. We don't act as that sort of rubberstamping service for that.

But if the parties are happy to engage in this, and the employee, for example, agrees that the relationship is fundamentally destroyed and they have the ability to negotiate the terms of the packets that they're leaving on through the non-ET1 process, we will facilitate that. Yes, absolutely.

But there are very strict rules on it, and no employee should ever come to our offices, or virtually now, feeling that they're being railroaded into it. In that case, then they should litigate. It has to be a voluntary process. It must be a voluntary process. The non-ET1 process that we facilitate is very, very rigidly controlled.

Dismissal for Health and Safety Related Reasons

Scott: Okay. Castano and London General Transport Services is your fourth pick of the year, Mark. So tell us about that.

Mark: This is an interesting case and a wee bit sort of an offbeat case to a certain extent, but it resonates in a COVID context.

This was a case about a bus driver who didn't have two years' service, which you're required in GB to be able to claim unfair dismissal. He had less than the two-year service. It's one year here, obviously. He was dismissed, and he tried to claim that he was dismissed for a health- and safety-related reason.

So, as a bus driver, he had certain duties with regard to the health and safety of his passengers on his bus route. In a quite ingenious argument, he said that his place of work was his bus and his bus route, and he had been given by his employer designated health and safety rule with regard to the health of the passenger.

And if you're dismissed or suffer a detriment on health- and safety-related grounds, then the qualification period is irrelevant. It's an automatic unfair dismissal if you're dismissed under Section 100 of the Employment Rights Act in GB. If you suffer a detriment, it's Section 44 of the Employment Rights Act.

In Northern Ireland, at the height of the COVID pandemic, we saw increasing references to Article 68D and Article 132 of the Employment Rights Order, and that's the health and safety detriment or dismissal provision.

Say, for example, someone in a COIVD context is given a designated health- and safety-related rule. Say, for example, you're chaperoning customers, making sure people are abiding by the two-meter rule, making sure people are following the one-way circuit, etc. The question here then is in a COVID context, are they then over and above your normal health- and safety-related responsibilities as an employer, and are these now designated health- and safety-related rules?

And if they are, and an individual says, "Well, no, I see a serious and imminent danger", and they walk off the site or they refuse to do something and they suffer a detriment or dismissal, then they're protected under that legislation.

I see all of the trade unions in Northern Ireland are well versed in this, and rightly so because they're protecting their members. So their members see that there is a serious or imminent danger. For example, failure to provide adequate PPE or failure to conduct risk assessments.

And this has been coming to the fore in recent weeks because of the variants of COVID, and trade unions, for example, are saying, "Well, no, you have to make an augmented risk assessment because transmissibility is a greater problem with the Brazilian variant", or with the Portuguese variant, or with the English variant, or whatever it happens to be.

And so I think employers need to be very wary of someone having health and safety responsibilities that are commensurate with all employees, and then designating health and safety rules. Because the minute you designate, be it in a unionised context or not, then you attract the protections, if you like, of Article 68D and Article 132 with regard to detriment and dismissal.

So although Castano pre-dated the pandemic, the issue with regard to protections under health and safety legislation, which is embedded in the Employment Rights Order of 1996 in Northern Ireland, comes to the fore because it's the first port of call. Any trade union rep worth his or her salt will say to their members, "If there's an issue with PPE or there's an issue with regard to safe working practices, etc., this is the legislation that we'll rely on both collectively and potentially individually if people are given these designated roles".

So the people who are now on the front line who have been at work all the time who are doing their work in a different way, in a more safe way, the question is if they're given additional health- and safety-related duties, are they designated? That's the question. Employers need to be very, very wary of that.

Scott: Okay. It brings higher rewards as well as removing the one-year requirement for unfair dismissal, obviously, with those kinds of issues there.

Mark: It does.

Scott: So, certainly, I suppose the lesson is to look at what you've done, look at your return to work safely protocols, and all that kind of stuff.

Risk Assessments for Remote Workers

There is a question there, just a general one. I don't know if you want to answer it, Mark. We have dealt with it in Seamus McGranaghan's webinars on Fridays in the past, but what risk assessment does an employer need to do for an employee working from home? The responsibility is still there whether you're working from home or you're working in the office. I don't know the health and safety thing, but you still have to do the risk assessment.

Mark: You do, because, essentially, the work environment has now returned to home. I know certainly internally within our organisation, we've conducted risk assessment for people who are working from home. And that's everything from your standard tripping hazards, your computer, your laptop. The requirement doesn't stop purely because the individual is working from home.

So it covers everything . . . if you look at it holistically, it's everything from your house insurance right through to cables and tripping hazards and everything in between.

Some employers go as far as in the risk assessment ensuring people disconnect. Because one of the difficulties you're hearing people who are working remotely is they're not sticking to their core hours. They're working way beyond their hours and they're burning out because they can't make the disconnect between home and work. And a lot of that is to do with the environment in which you're working in your house. If the laptop is sitting where you normally sit watching TV or whatever you're doing, the environment then starts to sort of merge between your home and work.

And there are moves afoot, certainly, in the Republic of Ireland, who last week launched their national strategy on remote working. Obviously, they have taken the decision to say this is now part and parcel of what the new normal will look like. So, in the future, at least 20% of public sector employees will be working from home.

And this will be embedded into, I suspect, the next big social partnership agreement between the trade unions and the employers in the Republic because they've seen the writing on the wall. There's no way that everybody is going to return to the offices even when the vaccination programmes are complete, etc.

They've learned their lessons over the last 12 months in terms of what works and what doesn't work, and productivity, and absence, and money saving, and all the things that have been put in. Employers aren't sitting back and just not learning the lessons here. The lessons have been learned, and obviously, in the Republic, they have factored that into their strategy.

Scott: They have indeed. The national strategy was out the other week there. I'm seeing there are some nice links in there to EU saying that the right to disconnect should be an EU-wide fundamental right. Again, now that we're out, that may not apply here, but it's going to happen anyway because of liabilities.

There are a number of questions coming in. I'm not going to deal with them just now, Mark, because I think we'll hand them over. We're here next week with Seamus if people can listen. We'll get through this case and then get on to the things that are coming forward.

We might extend the webinar past 11:45 just a little bit for those that can stay on. If you can't stay on past 11:45, you can listen back. It will be on the website later on this afternoon, and we'll have a transcript available as well in the next week or two.

Breach of Data Protection – Vicarious Liability

Now, Morrisons. This is a huge victory for the employer, having had huge losses before that. This is about, again, liability for criminal activities by the employee, effectively, isn't it?

Mark: Yeah, it is. This was my number one case in 2020 because effectively . . . and everybody will be familiar with the details of this. This was about an employee who went rogue, took the details of nearly 10,000 employees of Morrisons, and uploaded them surreptitiously from the comfort of his own home, and disguised his identity and put all the employee details up onto the internet.

And the question at the heart of it . . . and it went right the way through. Obviously, it's a Supreme Court decision. It was whether the employer was vicariously liable for this.

I think to cut a long story short, because as you said, Scott, it's very much a victory for the employer, the law on vicarious liability from around 2010 onwards went rogue. It went on a bit of a frolic of its own, to use the terminology that lawyers will be familiar with. Essentially, an employer will be vicariously liable for any torts or negligent acts the employee does in the course of their employment. And the focus of this is "in the course of their employment" and how closely connected the act that they did is to their employer, and whether or not it's just and equitable to hold the employer liable for that is at the core of this.

So, 10 years ago, the Lister case was a sort of benchmark for this, and the close connection test was pretty much set in stone. Fast-forward in the next six, seven years, and another case against Morrisons called Mohamud set the cat amongst the pigeons about the law on vicarious liability.

It seemed as if employers were becoming more and more . . . the courts took a more sort of pro-employee approach to this in the sense that employers were going to be held liable for acts that didn't seem to be closely connected because individuals seemed to be doing something that was an unauthorised act, and it was, in this case, illegal. How can they be held liable for this?

So what the Supreme Court decision in Morrisons has done has restored the natural order, if you like, of the case law back to the sort of days of Lister, so that employers won't be held liable for an employee doing an unauthorised act that takes him outside the scope of their employment and breaks that close connectivity test. And so a lot of employers breathed a sigh of relief when this decision came out.

That combined with the fact that it pre-dated GDPR and there were lots of issues with regard to data protection, I think one of the side issues that may get lost in this particular decision is the Supreme Court clarified that there is vicarious liability under data protection legislation. Even though it relates to the Data Protection Act of 1998 and has now been superseded by the GDPR regulations, it made it very, very clear that vicarious liability does apply in a data protection context.

Scott: Okay. So, if anyone is out there thinking, "That's good. I'm not going to be held liable for the criminal acts of my employees", they're still going to be held liable for the mistaken acts if they're trying to do it right. So, if somebody mistakenly posts all of that personal information on the internet, the employer will be held liable in all likelihood. If it's a criminal act, then according to this case, they're not. So it's not a get out of jail free for employers and vicarious liability by any stretch of the imagination.

Mark: No, it's not.

Scott: Okay. Let's move on. I know there are a number of questions coming in, but hopefully we can deal with those next week in Seamus's webinar.

Employment Law Post Brexit

Post-Brexit reform agenda. This was on, it was off, it was on, it was off. So tell us, what's off, Mark?

Mark: Yeah. This week has been absolutely amazing. When I was preparing for this webinar at the start of the week, on Monday there was an announcement, a leak that there would be in GB a review of employment law, and by Thursday morning there was a complete U-turn from the Business Secretary in GB, Kwasi Kwarteng, and effectively, now it's off the table.

So, in the intervening time between Tuesday and Wednesday of this week, I was preparing material to say be ready for GB reforms, especially around the working time regulations. So issues about the cap and the 48-hour week, issues with regard to document and record keeping around the 48-hour week, all would be targeted on the agenda for reform. There will be changes to the law, and should be, and there will be changes to the law in regard to agency workers and gig workers.

And lo and behold, come Thursday morning, it had been pulled, and there's a variety of conspiracy theories about why that happened. But certainly, there was an expectation at least that the issue of working time would be addressed, especially around the calculation of holiday pay.

You bear in mind we have three cases currently at the Supreme Court that relate to holiday pay, and a betting man would have said there are definitely going to be reforms in this area, for example, making a statutory change to not include overtime in the calculation of holiday pay, which is at the heart of Agnew and at the heart of so many other cases.

But suddenly, on Thursday morning, we were told that's not happening now. That review is not happening. Whether it's been put on the back burner for a while until the initial Brexit settles, we don't know. But what looked like it was going to happen on Monday, by Thursday isn't happening in GB.

Scott: So, in any case, even if they change in GB, they wouldn't necessarily change over here because of devolved function.

We've had a little comment in here. I think it's from your mum, Mark. It says, "Can I just compliment Mark for a most comprehensive webinar? He's very easy to listen to and clearly incredibly knowledgeable in his field. Really appreciate this invaluable, free resource". Well, thank you very much.

Mark: Thank you, Mum.

Scott: Mark is a wonderful man. There's a reason that he holds the Annual Reviews and closes them as well.

Holiday Pay Cases – Pending Supreme Court Judgement

But there is another question that's come in. "In terms of the pending Supreme Court judgements", so skipping ahead a little bit there, "is it appropriate for Northern Ireland to rely on limiting holiday payments to two years?"

Mark: My personal opinion of that . . . and it is a personal opinion. It's not the view of the agency. My personal opinion is that the two-year backstop in GB is eminently challengeable. I don't think it would stand up to scrutiny. If it was challenged at the Supreme Court, I think it would fall for the same reasons that exist on the case law going right back to B.A. and Williams.

The two-year backstop when it came into GB raised an eyebrow across the landscape, and to be honest with you, my personal view was I was amazed that it wasn't challenged at the time. I don't think the two-year backstop in GB would stand up to scrutiny at the Supreme Court level. It wasn't implemented, as you know, in Northern Ireland.

The difficulty is then you're into the realms of potential holiday pay claims going back to when the working time regulations first came out, which is 1998, which is over 20 years ago.

And so, no, my personal opinion is that I don't think the two-year backstop would stand up to scrutiny.

Employment Bill 2021

Scott: Okay. Thank you very much, Mark. Now your second point, the employment bill 2021.

Mark: There's been a great debate about this in GB about when this is coming out, and where all of the Taylor reforms were coming, and whether or not they were coming in.

We've been waiting on an employment bill in GB for a long time now, and some of the headings that will probably . . . what we expect to see are things about single enforcement body for things like in and around national minimum wage and vulnerable workers, tips to go to workers in full, the right for gig workers to request a more predictable contract, extending redundancy protection to pregnant and new mothers into a six-month period, leave for neonatal care, unpaid carers leave, and making flexible working the default for organisations with over 250 employees.

The difficulty with that is some of those pertain to Theresa Mays's premiership, and whether or not they will wither on the vein as a legacy of that particular premiership, we don't know.

The signs aren't good. This week we saw that the director of the Labour Market Enforcement Unit in GB, who happens to be one Matthew Taylor, hasn't been replaced. He left this week and there's no replacement, and one of his primary functions in there is to look at issues about vulnerable workers and employment agencies and gangmasters licensing and stuff like that. That doesn't look good.

So we've been waiting on an employment bill for a long time in GB. For example, the Northern Ireland policy direction is one of a parity pathway, they talk about, where we just reflect what's happening in GB. What's contained in that employment bill will be very, very important.

Scott: Okay. We'll skip on to the last point there. Any news of policy direction or employment bills, or even implementing some of the old employment bill of 2016 here?

Mark: No. What we will expect to see very shortly will be the implementation of the parental bereavement leave from the Department for Employment, and that will be generally a mirror reflection of what's contained in the GB legislation.

Over and above that, we're not sure. I think the policy direction of the department has primarily been about the response to COVID and COVID recovery.

The fact that we saw a statistic yesterday that was shocking to see, that nearly 95,000 people in Northern Ireland were still on furlough, and furlough ends in April, I think that's the priority that the department has now rather than looking at employment law developments. That's understandable.

I think when all of this settles, and it might be a next electoral mandate and we might have a different Minister, they begin to look at it. But policy direction for the meantime is focussed on COVID and COVID recovery. So over and above saying parental bereavement leave, I don't think you'll necessarily see anything else happening.

Scott: Okay. But we do have an NI protocol. So we had a couple of articles out recently on Legal-Island, one from John McMullen, looking at the impact of Brexit employment laws in both . . . well, it was throughout the UK, but also concerning the protocol. We had one from Jones Cassidy Brett as well looking at that and the impact of the protocol. So maybe briefly cover that third point there, Mark.

Mark: In January, just this month at the start of the year, the Equality Commission and the Northern Ireland Human Rights Commission have new functions under the Northern Ireland protocol, and those are around Article 2.

The DMU is a Dedicated Mechanism Unit, which sits within the Equality Commission, and effectively, their role is to ensure that in this post-Brexit environment in which we live in, equality rates are not diminished. So they're effectively a watchdog to ensure that there's no diminution of equality-related rights. Most of those extend from the six EU-based equality frame directives, but also from the Belfast Good Friday Agreement. So their primary function is to make sure that the equality rights do not drop below what they are at the minute.

And it's really interesting because that could cut across general employment rights. Say, for example, there was a reform agenda on something like agency workers, which has long been held to be a possible target on post-Brexit reform. Well, the vast majority of agency workers are young and they're female. So, if it has a negative effect or a diminution on their rights, then that could potentially trigger an Article 2 noncompliance argument with the Equality Commission because their rights are being indirectly discriminatory on women and young workers because of a post-Brexit reform.

So I think what's going to happen is any employment law that's being discussed will have to go through an Article 2 compliance check, if you like, to ensure that they don't offend against the principle contained within the protocol.

And it's interesting, because when you look at the Belfast Good Friday Agreement, it's not simply just about sex, race, religion, political opinion, age, disability, sexual orientation, and all of the protected categories. It also covers things like class. So, when you look at the Northern Ireland explainer for the Dedicated Mechanism Unit, there are a few grey areas to say, "Well, that's really going to have to be tested".

So Northern Ireland, by virtue of the protocol in this particular area, in employment law, there will be unique kinks, if you like, that will be unique to Northern Ireland and not apply across the water in GB. So it'll be really interesting.

It's very early days. They've only been set up a couple of weeks ago. I was speaking to the Director of the Dedicated Mechanism Unit as recently as last week on this, so it'll be interesting to see how Article 2 becomes ingrained in the sort of pre-legislative process to ensure that everything is compliant with Article 2.

Scott: Okay. Thanks very much, Mark. Yeah, you've seen the impact, I suppose, the equality impacts of COVID, and you mentioned 95 people that are on furlough. The bulk of those are younger workers generally. Again, there's an awful lot of research showing that the impact on ethnic minorities and such like is huge.

At least here we've got someone looking at equality questions and mainstreaming it and making sure that there's some kind of check, because it's so easy to inadvertently do something and the impact on a minority group or a lack of social inclusion, which is included in the protocol there, could be missed. So good job that they're doing there.

Pending Supreme Court Judgements - 2021

Now, there may not be much legislation coming up this particular year other than myriad things to do with COVID and regulations there. But there are these cases, and case law is going to drive the law in this particular year. We've been waiting on some of these for quite a while, even the ones that have been heard. So maybe just have a go at kind of encapsulating the impact that Mencap, Uber, Agnew, whatever will have on employment law and rights in Northern Ireland in particular.

Mark: It's a point well made. Because we have a dearth of legislation coming through, it's a case of all HR practitioners and trade union officials and employment lawyers looking to the courts for direction on this. And some of these cases, obviously, are big-hitting cases, have massive ramifications for employers, and that's really where we're going to see the sort of direction of travel being, despite the fact that there's been a delay.

We've been waiting on the Mencap decision for well over a year now. It is imminent. It's a case, as you'll remember, about people who are on night duty but are permitted to sleep, whether or not they qualify for the national minimum wage when they're sleeping.

This has massive social policy ramifications, because if they win the case, then effectively the financial ramifications for the health sector across the UK are absolutely huge, because obviously there would be a massive financial cost to employers to pay in those cases.

And given the fact that the health industry and the health workers are quite rightly deemed to be heroes, if the decision goes against them in this particular case, there may be an eyebrow raised at Cabinet level. So that decision literally should be out within the next couple of weeks.

Uber, and the decision we're hoping at some stage later on this year, is the one that I've talked about and many, many other commentators have talked about for years now. Effectively, if Uber loses this case, it'll put a question mark over many other digital platform-based organisations in terms of . . .

Their entire business model is predicated on the fact that they have a collection of independent contractors working for them, but they don't have worker status. And that's why Pimlico and Hermes and all of the other gig economy cases that we've seen . . . I mean, if Uber follows the same direction of travel, the business model that Uber follows will fundamentally fall away and they'll have to do a complete rethink in that regard.

And it'll have knock-on ramifications for other digital platform organisations that use a similar model, so it really, really is one of those touchstone cases and a very, very important decision.

The Agnew case everybody is waiting on because it's the big holiday pay case. As I said, there are two others. The Harper and Brazil Trust case goes to . . . I think it's the Court of Appeal in November 2021. And the Flowers and East England Ambulance Trust, again, it's a voluntary overtime case, and it's due to be heard in June.

The fact that these three cases were sitting at very Superior Court level was what prompted lots of commentators in GB to say, "Look, there's going to be reform to the working time regulations, and the first thing they'll do after scrapping the 48-hour cap is looking at holiday pay".

It has just been a series and continuing series of defeats for the approach that employers and the government have backed for years. It didn't embrace exactly what the legislation said in the context of the working time regulations because we had this dichotomy between how remuneration is defined under the working time regulations and how a week's wages are defined under the Employment Rights and Domestic Legislation on the Employment Rights of Northern Ireland order.

So this is a mess that has been decades in the making. It seemingly now isn't going to be resolved under employment law review in 2021. So, again, it's left for the courts.

If Agnew, Harper Trust, and the Flowers case all fall in the employees' favour, then employers are obviously going be bound by this and they're going to have to step up with regard to their holiday pay calculations because it will address the whole thing about on-going series of deductions, the fact that people have to lodge cases every three months, or whether or not it breaks the continuity of the claim. All of these things will be addressed.

So, 2021, all things being equal, if the cases are able to be heard when they're listed in the middle and towards the tail end of 2021, we should have a clear direction about holiday pay cases, because it's not going to come from employment law reform.

Scott: Okay. Thank you very much, Mark. Thank you to everybody for listening there today. We had a number of questions. We'll try and pass them over to next Friday.

Mark: I'll happily let Seamus answer them.

Scott: Well, you can pass them on. There's Mark's and my contacts. There will be another webinar same time next Friday. And again, you can listen back to those ones as well, so you'll be able to log on. For any of the webinars that we're doing, if you just go into the Events page on, the first tab is always Webinars. So any webinars that are coming up, please just log on there and join us. They're usually on at 11:00, depending on the day. But anyway, next Friday will be the one with Seamus. We'll take the questions that we didn't manage to get through.

There was one there about TUPE. Just in case you're interested, there is going to be a master class with the bold Dr John McMullen and Rachel Penny from Carson McDowell and Adam Brett from Jones Cassidy Brett on the 25th of February. And again, you'll find that on the Events page.

Just before you go, there's the last reminder for the HR Re-Skilling event that we're having starting next week over three half-days. So, if you're interesting in that and you've typed in yes into the question box, we'll get back to you directly with various details and a special offer, so don't worry about that.

Okay, folks. Thank you very much. Thank you, Mark. It's been wonderful.

Mark: You're welcome.

Scott: If you've got anything else, you can get in touch with the LRA. They know where you are. Hopefully, we'll see you again soon. You take care now. Have fun. Bye, everyone.

Mark: Bye.

This article is correct at 29/01/2021

The information in this article is provided as part of Legal-Island's Employment Law Hub. We regret we are not able to respond to requests for specific legal or HR queries and recommend that professional advice is obtained before relying on information supplied anywhere within this article.

Mark McAllister
Labour Relations Agency

The main content of this article was provided by Mark McAllister. Contact telephone number is 028 9033 7403 or email

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