Disputed penalty: should ETs have the power to impose financial penalties on employers?

Well, it had to happen eventually. After many years as the Tweedledum and Tweedledee of the employment policy (under)world – virtually indistinguishable in our views on any number of policy initiatives and legal reforms – Michael Reed, of the Free Representation Unit, and I have had a policy disagreement. And not just a slight difference of opinion, but a full-blown parting of the ways. To quote Michael – something I will be doing a lot less of from now on, obviously – we are “complete opposites” in our view.

What? Complete opposites, after all those years of “I agree with Michael” and “I agree with Richard” in meetings with BIS and Ministry of Justice officials? Has one of us lost our marbles? Or taken the Beecroft shilling?

Our story

All was hunky dory with Michael and me, until last week. But then Acas went and tweeted a news article of theirs about the coming into force, on 6 April, of the new power for employment tribunals to order any employer found to have made a breach of the rules with ‘aggravating features’ – whatever that means – to pay a financial penalty of up to £5,000 (section 16 of the Enterprise & Regulatory Reform Act 2013). And, somewhat unthinkingly, I retweeted it. I’m like that, you see. Impulsive.

Almost immediately, my universe began to crumble. “Leaving aside the implementation, do you think financial penalties are a good idea”, demanded a tweet from Michael.

Through a veil of tears, I tweeted my pathetic reply: “Yes, though I doubt ETs will ever have the information they need to use the power effectively. I can see it being used very little”. Because, whilst I would have much preferred to see the power more narrowly framed and targeted at, say, repeat offenders and those who have failed to pay a previous award, I do think it a good thing that life might become a little harder (or, at least, a little more expensive) for rogue employers. And, let’s face it, since 2010 rogue employers have done rather well out of all the Coalition’s other reforms of employment law and the ET system.

And then he – Michael – said it: “Interesting. We’re complete opposites. I think it’s wrong in principle. And I think it’ll be used reasonably often”. Yep, you don’t get much more completely opposite than that. But enough from me. Let’s hear what Michael has to say.

Michael says:

First of all, Tweedledum and Tweedledee? I protest! We are the Butch and Sundance of employment law. Or, at the very least, the Laurel and Hardy.

But, through a veil of tears, I turn to the substance of our tiff. Should employment tribunals impose financial penalties on employers, separately to awarding compensation to employees? I start from the position that there’s a name for imposing a financial punishment on people because they’ve acted unlawfully. That’s called a fine.

And a fine is properly the province of the criminal justice system. Basically, I don’t think that the State should be extracting money from people in this way without the full paraphernalia of the criminal law — including proper legal aid and proving things beyond reasonable doubt. I realise that, in all sorts of areas, we’ve slid into this sort of civil penalty charge, but I disapprove of all that too.

The State, whatever its protests, is a 1000-tonne gorilla. It has immense resources and a monopoly on the use of force as a means of coercion. It has to be self-denying and self-limiting — willing to shackle itself to the rule of law. Or we’ll all end up in unpleasantness.

Now, of course, introducing employer penalties does not inevitably lead to a totalitarian dystopia. It’s not even on the top 10 things this government has done which might lead to a totalitarian dystopia.

In fact, I think it’s very unlikely to have any real negative impact in the wider sense at all. But the nature of this sort of principle is that it’s important enough that you follow it, even when pragmatically the danger seems non-existent.

Even if all of this is wrong, I just think the employment tribunal is the wrong place to be dealing with this sort of fine. A criminal sanction should be applied consistently. Which is why the police and CPS have guidelines about when to take cases to court. Shackling the sanction to unconnected civil litigation means that who gets fined will depend on who gets sued (and who settles). It’s built-in inconsistency.

Furthermore, shoehorning a criminal sanction into a civil trial isn’t likely to do either of them any favours. Tribunals have challenges enough dealing with all the issues of party vs party litigation, without bolting on a bit of party vs State for them to address as well. Does no one think of the poor judges?

Finally (and this might not be a matter of principle at all), I simply can’t stomach a government that imposes a draconian cap on the compensation that claimants can receive, while attempting to trouser a wedge of cash for itself.

The average UK salary is £27,000 (and therefore so is the unfair dismissal cap for the average employee). The maximum penalty is £5,000. The government position is that the cap is needed so people don’t have false perceptions of their likely award. This cannot be reconciled with trying to grab up to 18% of the value of the maximum award for the State. The government’s position on this is contemptible. Sufficiently so that my emotions run high and I couldn’t bring myself to support the financial penalty, even if I could put aside my virtuous principles.

To which Richard says:

Yes but no but yes but … darn it, you’ve convinced me. The section 16 penalties are wrong in principle, and employment tribunals the wrong arena. Can we be friends again?

However, I still think the power to impose a penalty will be rarely used, not least because the often low-value claims brought against the kind of exploitative employer at which the power is supposedly aimed, are precisely those claims that have been barred from the tribunal system by the outrageous fees introduced last July. Vulnerable workers subjected to ‘wage theft’ of a few hundred pounds are simply not going to gamble £390 on trying to extract the unpaid wages from a rogue employer.

Even where such claims do make it as far as the tribunal, I suspect the average employment judge will be no more minded to impose a penalty than they have been to date to impose a costs order. And, whilst the number of costs orders – and especially orders against claimants – has crept up in recent years, it is still very small.

Time will tell. As would the quarterly and annual tribunal statistics, were the good people at HMCTS to take the necessary steps to record use of the power. Unfortunately, it seems they have no plans to do so.

To which Michael says:

Darn it, I was hoping you’d turn me around. Then I could urge tribunals to award large penalties against my opponents with a merry heart (although one of the many minor issues with the scheme will be what, if anything, claimants and their lawyers should say about all this). But at least we’re friends again.

I’m much less dogmatic on the issue of how much the new power will be used. It’s really about our gut feelings on how judges will react. And, as anyone will tell you, judges are an unpredictable lot. But, from a judicial perspective, I see the financial penalties as looking more like an uplift for breach of the Acas Code than a costs order.

I think judges regularly get a sense of whether they think an employer is a proper wrong’un who has acted maliciously or just a bit of a ninny who made a mess of things. And the principled argument against the whole idea we’ve discussed above don’t bear on sitting judges. They may think the law shouldn’t be there but, since it is, they’ll have to consider it.

My guess is that, if they peg someone as a wrong’un and can point to something to describe as an aggravating feature, they’ll be willing to impose a financial penalty. In part, I think this is because it won’t require a lot of additional reasoning or fact finding for the tribunal. One of the reasons that costs are rarely awarded is that they often require everyone to embark on a new set of evidence and submissions right at the end of the case, when everyone just wants to go home (or already has).

In the case of financial penalties, things are much easier. All the evidence will be in as part of the liability trial. If, at the end of submissions, a judge thinks a penalty might be appropriate they can flag it with the parties and hear what they have to say. Which probably won’t be much, beyond the respondent arguing that, even if they lose, they haven’t gone as far as aggravated breach. Then the tribunal can cover it in a paragraph or two in their judgment. No muss, no fuss.

Of course, you’re right that the reduced number of claims will hold down the number of these penalties (which, come to think of it, is yet another reason why the tribunal is the wrong venue for this sort of thing). But I think, proportionally, we’ll see a reasonable number of these awards.

As you say, time will tell (particularly if we get the stats). Shall we schedule a follow-up post for about a year’s time?

One of us can crow and the other can explain why they weren’t really as wrong as it looks.

Please feel free to endanger the conscious recoupling of Michael and me by taking sides – leave a comment.


The one chart that shows the MoJ is talking out of its a**e on ET fees

Unless you’ve just come back from a trip to Mars, you’ve probably seen the quarterly tribunal statistics issued by the Ministry of Justice yesterday, showing a dramatic, 79 per cent fall in the number of employment tribunal claims. (But if you need to catch up, this outstanding blog post by Gem Reucroft tells you all you need to know).

In fact, it’s not quite as bad as that, but it’s still very, very bad.

The overall number of claims in the three-month period October to December 2013  is down 79 per cent, compared to the same period a year ago.  But the overall number of claims includes all the multiple claimants in the relatively small number of multiple claim cases, which are much less affected by the fees regime, not least because the fees paid per multiple claim case are capped at six times the fee for a single claim, regardless of the number of claimants in the case, which can be as many as several thousand.  And most multiple claims are brought by a trade union, with the biggest unions now paying such fees for their members.

What really matters here is the number of single claims by individual workers. And, compared to a year ago, that is down by 67 per cent. Which is plenty bad enough.

In response, the Ministry of Justice does not appear to have issued any formal statement on the matter (other than the statistical bulletin itself). But the justice minister, Shailesh Vara MP, is quoted in both the Financial Times and Personnel Today as saying:

“We think that the fees are not the only reason for the fall in the number of employment tribunal receipts; there has been a longer term downward trend as the economy has strengthened, and some of the big [multiple claim] cases involving airlines are now being concluded.”

Which, as the following chart shows, is utter hogwash.  The chart shows the number of single claims by individual workers, so the issue of the ‘big multiple claim cases involving airlines’ is irrelevant.  And I challenge Mr Vara and his officials to identify any significant ‘longer term downward trend’ going on here.

Chart: single ET claims, January 2012 to December 2013

ET single claims, monthly 14 03 14

(Yes, I’ve left out the months of July, August and September 2013, because they tell us nothing other than that there was a predictable rush to submit claims in July, before the fees came into force on 29 July, followed by a balancing out in August and early September.)

The simple fact of the matter is that ET claims have fallen off a cliff since the introduction of fees.  But if anyone in the Ministry of Justice can produce a chart or graph showing a longer-term downward trend behind the figures for October, November and December 2013, we’d be very happy to reproduce it here on Hard Labour.

So, exactly how much does it cost to make an employment tribunal claim?

You might be wondering – no, I’m sure you’re wondering – how much it costs to make an employment tribunal claim these days. It’s a good question. And who better to answer it than Jenny Willott, the Liberal Democrat MP for Cardiff Central and current BIS employment relations minister?

Just a few weeks ago, in the House of Commons, the Minister rather testily insisted to MPs that “it does not cost women [who have been subject to pregnancy discrimination] more than £1,000 to go to a tribunal. It costs only £250 to start a claim, and most cases are finalised well before a hearing”.

Well, thank goodness for that!  We wouldn’t want excessive cost obstructing workers’ access to justice.

However, somewhat confusingly, last week the Minister wrote that it costs “on average £1,800 to present a claim at tribunal” for, say, pregnancy discrimination. It does?

Yes, it does. It says so in Annex A of the BIS final regulatory impact assessment on Acas early conciliation, quietly published by BIS last week.  This shows how the Minister’s £1,800 figure consists of three elements, each one calculated in 2012: there’s £714 for “time spent on case”, £23 for “travel & communication”, and a whopping £1,017 for “costs for advice & representation post ET1”. (Yes, I know. But who are we to question figures approved by the BIS employment relations minister?)

That comes to a total of £1,754, which BIS then rounds up to £1,800.  So, the Minister’s figure of £1,800 does not include anything for the hefty upfront tribunal fees introduced in July 2013.

Which means it costs, on average, £2,050 to issue and pursue a tribunal claim for pregnancy discrimination. Which, according to both Maternity Action and the equalities minister, Maria Miller, is a serious and growing problem.  And, where the case goes to a hearing, for which a fee of £950 is payable, that average cost rises to £3,000.

So now we know.  Thank you, Jenny.

Jessemy v Rowstock Ltd: post-termination victimisation and the limits of judicial reasoning

Jessemy v Rowstock Ltd: post-termination victimisation and the limits of judicial reasoning by Harini Iyengar

How did the Court of Appeal in Jessemy v Rowstock Ltd [2014] EWCA Civ 185 conclude that victimisation of former employees remains unlawful even though “on any natural reading of the relevant provisions of the [Equality Act 2010], taken on their own and without reference to any contextual material, post-termination victimisation is not proscribed”.


The Court of Appeal (“CA”) has held that post-termination victimisation is unlawful, by adopting an ingenious interpretation of section 108(7) of the Equality Act 2010. Whilst the outcome is clearly correct according to the coterie of right-minded employment lawyers (amongst whom I would aspire to class myself), the case provides an intriguing example of a court concluding that what the law says is in fact exactly what it does not say. Does the type of judicial reasoning which the CA has deployed in Jessemy v Rowstock Ltd give discrimination law a bad name?

The Judgment

The judgment of the CA was given by Underhill LJ, former President of the Employment Appeal Tribunal (“EAT”), (with whom Ryder and Maurice Kay LJJ agreed) and upheld the judgment which his successor, Langstaff J, had given on the same issue in the EAT in Onu v Akwiwu, whilst overruling Mr Recorder Luba QC in Jessamy v Rowstock Ltd in the EAT.

As Underhill LJ stated, “the issue is one of pure law”, so, in regard to the facts, it is sufficient to relate simply that the claim of post-termination victimisation which the Employment Tribunal (“ET”) and then the EAT dismissed concerned a Claimant who was subjected to a detriment in the form of a poor reference from a former employer because he had brought proceedings for unfair dismissal and age discrimination.

The First-Generation Discrimination Statutes

The CA first considered the law on victimisation under the “first-generation” discrimination statutes (the Sex Discrimination Act 1975, the Race Relations Act 1976, and the Disability Discrimination Act 1995) which prohibited discrimination by an employer against a worker “employed by him” or “whom he employs”. In Post Office v Adekeye the CA held in 1997 that the natural meaning of these phrases confined the protection against discrimination to workers employed at the time of the act complained of, however, in Coote v Granada Hospitality Ltd in 1999 the European Court of Justice (“ECJ”) held that since sex discrimination was proscribed under the Equal Treatment Directive, the “principle of effectiveness” meant that employees complaining of sex discrimination had to be protected against victimisation on that account, whether the victimisation occurred during employment or after termination. On remission, the EAT held in Coote that “employed by him” should be construed as including a former employee who had complained of sex discrimination, and that Adekeye should not be followed.

Then, in Rhys-Harper v Relaxion Group plc in 2003, the House of Lords authoritatively determined that in regard to all three first-generation discrimination statutes, “employed by him” and “whom he employs” (despite the use of the present tense) could and should be read as applying to former employees. According to Underhill LJ, “The essential point is that it was regarded as extremely unlikely that Parliament had intended to exclude all claims for post-employment discrimination.” The majority reached those conclusions by applying ordinary domestic principles of construction, rather than the ECJ decision in Coote.

The Second-Generation Discrimination Provisions

In 2003, in regard to sexual orientation and religion or belief, and in 2006 in regard to age, the second-generation discrimination rights were brought in through statutory instruments which expressly rendered unlawful any discrimination or harassment which arose out of and was closely connected to “relationships which have come to an end”. Equivalent provisions were inserted by regulation at the same time into the first-generation discrimination statutes.
This analysis brought Underhill LJ to the bedrock of his argument: “The upshot of all that is that at the time that the 2010 Act was drafted it was well-established that post-employment discrimination – which included victimisation – was unlawful.”

The Equality Act 2010

He went on to analyse the structure of the Equality Act 2010. Part 2 sets out key concepts on equality, Chapter 1 giving the protected characteristics and Chapter 2 explaining “Prohibited Conduct” in the form of direct and indirect discrimination, ancillary matters, and then “Other Prohibited Conduct” in sections 26 and 27 defining harassment and victimisation respectively. Unlike the first- and second-generation anti-discrimination rules, under the Equality Act 2010 rules, discrimination, harassment and victimisation are separated out as distinct forms of prohibited conduct.

It is only in Parts 5 and 8 that the relevant prohibited conduct is made unlawful. In Part 5, sub-sections 39(3) and (4) make it unlawful to victimise an employee by subjecting him or her to any other detriment (such as providing a bad reference). Section 83 contains the definition of “employee” as someone who is employed under a contract of employment, a contract of apprenticeship or a contract personally to do work. Part 8 covers “Prohibited Conduct: Ancillary” and includes section 108:

(1) A person (A) must not discriminate against another (B) if –
(a) the discrimination arises out of and is closely connected to a relationship which used to exist between them, and
(b) conduct of a description constituting the discrimination would, if it occurred during the relationship, contravene this Act.
(2) A person (A) must not harass another (B) if –
(a) the harassment arises out of and is closely connected to a relationship which used to exist between them, and
(b) conduct of a description constituting the harassment would, if it occurred during the relationship, contravene this Act.
(3) It does not matter whether the relationship ends before or after the commencement of this Act.
(4) …
(5) …
(6) For the purposes of Part 9 (enforcement), a contravention of this section relates to the Part of this Act that would have been contravened if the relationship had not ended.
(7) But conduct is not a contravention of this section in so far as it also amounts to victimisation of B by A.

The CA plainly identified “the problem” about section 108 as being that it explicitly proscribes post-termination discrimination and harassment, but contains no equivalent provisions as to victimisation. Underhill LJ politely said of section 108(7) that its “intended effect is far from clear”.

The New Generation Directives

Underhill LJ next moved on to European Union (“EU”) law, in the form of the Race Directive of 2000, the Framework Directive of 2000 on religion or belief, disability, age and sexual orientation, and the Recast Directive on sex discrimination of 2006, which he categorised as the new generation directives, structured differently from the Equal Treatment Directive which was in force at the time of the claims in Coote and Rhys-Harper. The new generation directives all contain a prohibition on victimisation which is worded in a broadly similar way, requiring Member States to introduce into their national legal systems such measures as are necessary to protect employees against dismissal or other adverse treatment by the employer as a reaction to a complaint within the undertaking or to any legal proceedings aimed at enforcing compliance with the principle of equal treatment.
Reaching the same conclusion in regard to EU law as he had in regard to domestic law, he said, “It is clear from the decision of the ECJ in Coote that that provision must apply equally to acts done after as well as during the currency of the employment relationship.”

The Straightforward Reasoning of the ET and the Luba EAT in Jessamy

The CA described the reasoning of the ET and the EAT in Jessamy as “straightforward”. Mr Recorder Luba QC’s EAT regarded it as “highly unlikely” that Parliament had intended with the Equality Act 2010 to legislate away any redress for post-employment victimisation, given both the domestic law in Rhys-Harper and the UK’s obligations under EU law. The EAT fully acknowledged the “flexible interpretative approach” required by EU law, and cited Attridge LLP v Coleman and Ghaidan v Godin-Mendoza, but concluded that to read section 108(7) as prohibiting post-termination victimisation would “fly directly in the face of what Parliament has actually enacted.”

The Wholly Domestic Interpretation of the Langstaff EAT in Onu

In contrast, Langstaff J’s EAT in Onu took an approach based on interpretative principles of domestic law, as in Rhys-Harper, to conclude that the reference to “an employee of A’s” in section 39(4), could be stretched to include former employees.

The Reasoning of the Court of Appeal

Underhill LJ considered that it was “clear that on a natural reading of the relevant provisions of the 2010 Act, taken on their own and without reference to any contextual material, post-termination victimisation is not proscribed”. How then did he manage to reach the opposite conclusion through deft judicial reasoning?
To start with, he acknowledged the shortcomings in Langstaff J’s approach in the EAT. Although, in isolation, “an employee of A’s” can be read as referring to a former employee, that is not consistent with the scheme of the Equality Act 2010, in which prohibited conduct arising out of a past relationship will be proscribed, if at all, by the ancillary provisions in Part 8, and in particular by section 108. There, discrimination and harassment post-termination are prohibited but not victimisation.

He then stated that when the contextual materials were considered, it was clear that the provision in the statute was “not the result which the draftsman intended”, pointing out that Langstaff J, Mr Recorder Luba QC, and the barristers in the case all shared that view.

The contextual materials on which Underhill LJ relied were (i) Rhys-Harper and the second-generation discrimination provisions which expressly made post-termination victimisation unlawful; (ii) the absence of any indication from the Government that the Equality Act 2010 was intended to change the law by removing protection against post-termination victimisation; (iii) the Explanatory Notes on section 108 which referred to claims being “dealt with under the victimisation provisions and not under this section”; (iv) the fact that if post-termination victimisation were not proscribed then the UK would be in breach of its obligations under EU law; and (v) the absence of any rational basis for treating post-termination victimisation differently from post-termination discrimination and harassment.

Taken together, these five matters led him to conclude, “It follows that the apparent failure of the statute to proscribe post-termination victimisation is a drafting error. … In the end, it is unnecessary to be able to show how the error arose as long as it is clear that it was indeed an error.”

The key issue for Underhill LJ was therefore, “… how far is it right to go to correct what is an undoubted drafting error: would that, as the EAT put it, involve crossing the Rubicon?” Underhill LJ reasoned that since the Equality Act 2010 gives effect to the UK’s equality obligations in EU law, the Court must adopt “the Ghaidan approach” which empowered it more widely to “depart from the natural reading of the language of the statute, including by the implication of words which alter its effect as drafted” than would be possible on a conventional domestic approach to statutory construction. He considered that the “flexible interpretative” Ghaidan approach “unquestionably” applied here. After a detailed analysis, he concluded that “the only question is whether it is “possible” … to imply words into the 2010 Act which achieve that result” of proscribing post-termination victimisation, that it plainly was possible, and that the implication of such words “in fact represents what the draftsman intended.” According to Underhill LJ, the Luba EAT erred in failing to appreciate just how flexible the Ghaidan approach was. Yet, while making this criticism, he acknowledged that “the effect of section 108(7) is decidedly opaque”. After bravely attempting to find meaning in the sub-section, Underhill LJ concluded that the first possible meaning (that post-termination was not intended to be proscribed and therefore was also not proscribed where it happened also to constitute post-termination discrimination) was one which would have “no rational reason … for having that effect, and it would have perverse results”, and the second possible meaning (that post-termination victimisation was proscribed elsewhere in the statute but for some reason cases of overlapping post-termination victimisation and discrimination claims should only be complained of under those other provisions) was “unconvincing” because cases of overlapping claims are common and do not in practice give rise to double recovery. Ultimately, Underhill LJ did accept that “it is indeed impossible to see the point of sub-section (7)”. He considered that “the draftsman may rather have lost his way in his treatment of section 108”, noting that in Schedule 28 “discrimination” was said to be defined in, amongst others, section 108, whereas in fact that section proscribed it.

From this position, that the draftsman must have lost his way, made an error, and drafted a meaningless sub-section, Underhill LJ reached the view that the section 108(7) contained “no clear indication of an intention that post-termination victimisation should be lawful”. Therefore, he reasoned, there was “no obstacle” to implying that section 108 gave effect to the EU obligation to proscribe post-employment victimisation. Perhaps intending to guide the lost draftsman, the Court of Appeal suggested either an amendment to section 108(1) to add:

In this sub-section discrimination includes victimisation,

or a new sub-section 2A to add:

A person (A) must not victimise another (B) if –
(a) the victimisation arises out of and is closely connected to a relationship which used to exist between them, and
(b) conduct of a description constituting the harassment would, if it occurred during the relationship, contravene this Act.

Having determined that it was meaningless, Underhill LJ was “not sure that anything needs to be done about sub-section (7)”. He was, however, careful to state that the meaningless sub-section “can have no meaning which is inconsistent with post-termination victimisation being unlawful.”

Then, at the request of the Equality and Human Rights Commission, which was concerned about discrimination in the provision of goods and services, not all of which is proscribed by EU law, Underhill LJ also considered whether the domestic approach to statutory construction would lead to a different result. He accepted a “more straightforward domestic route to the same result, by way of a “rectifying construction” of the kind adopted by the House of Lords in Inco,” involving a “plain case of drafting error”. For Underhill LJ, where there is a drafting error through omission, there is “no real difference” between the Ghaidan and the Inco approaches.

In Inco the court concluded that “the draftsman slipped up” and “the court must be able to correct obvious drafting errors”: the court held that the words “from any decision of the High Court under that Part” were to be read as meaning “from any decision of the High Court under a section in that Part which provides for an appeal from such decision.” According to Lord Nicholls in Inco, a court could adopt such a course only if “abundantly sure of three matters: (1) the intended purpose of the statute or provision in question; (2) that by inadvertence the draftsman and Parliament failed to give effect to that purpose in the provision in question; and (3) the substance of the provision Parliament would have made, although not necessarily the precise words Parliament would have used, had the error in the Bill been noticed.” Lord Nicholls went on to say, however, that the third condition was of crucial importance, because otherwise the court would be crossing the boundary between construction and legislation.

No doubt recognising the dramatic nature of his interpretation, Underhill LJ said, “It would be different in a case where no such intention is established and the argument is simply that the implication sought is necessary in order to comply with EU law or the requirements of the Convention.”


Through sophisticated reasoning, the CA has achieved a result which is fair in the minds of the coterie of employment lawyers, and which will be of practical service to many litigants (be they workers, employers, or those giving or receiving goods and services) by ending legal uncertainty. Is it right, however, for a court to respond to a statutory provision which has no satisfactory meaning by implying into the statute words which make conduct unlawful? The CA did not hold that sub-section 108(7) must be deleted as meaningless, but left it to “some other court” to “cudgel its brains about what real effect, if any, it has”. In spite of its hesitation to delete the sub-section, the CA felt confident in asserting that, whatever it might mean, the sub-section was definitely inconsistent with post-termination victimisation being permitted.

It seems to me that the CA has turned a statutory provision, which is, at best, meaningless, and is, at worst, ambiguous and inconsistent with the UK’s equality obligations under EU law, into a provision which renders conduct unlawful. Can the position really be said to be analogous to Inco? The Equality Act 2010 separated out harassment and victimisation into different claims, after decades of being aspects of discrimination. In my view, the difficulty is that, whilst the draftsman clearly drafted poorly, exactly what he was up to in terms of tinkering with the law on discrimination, harassment and victimisation and how they should interrelate, remains very unclear, yet, I feel sure that he was up to something.

Our clever judges know how to achieve the result which right-minded employment lawyers desire, through the deployment of deft judicial reasoning, but is it right to develop principles of judicial interpretation which permit a statutory provision to mean that conduct which is stated to be lawful is held to be unlawful?

Access to justice in general is a matter of acute concern to barristers right now. Within the field of employment law, the introduction of ET fees is having a profound effect on discrimination litigation, a part of the legal system which is intended to protect the most marginalised and disadvantaged groups of workers. Is it idealistic and unrealistic for me to long for judicial reasoning which makes sense to those outside the inner circle of employment lawyers, in regard to what the major discrimination statute means? Does the type of judicial reasoning which the CA has deployed in Jessemy v Rowstock Ltd give discrimination law a bad name?

Something else BIS missed about TUPE

The new fangled TUPE provisions contain the express ability for an employer at Reg 4(5B) to change a term incorporated from a collective agreement where (a) the variation takes effect more than one year after the transfer and (b) after the variation rights are no less favourable overall.  The problem is that complying with these requirements causes significant problems with an often overlooked section of TULRA 1992.

TUPE continues in 5(C) that “Paras (5) and (5B) do not affect any rule of law as to whether a contract of employment is effectively varied“.  Which got me thinking as to other rules of law.

One of the ones it appears BIS did not think about was Section 145B of TULRA 1992.  To save a quick rummage through the statute books, section 145B gives individuals the right not to have their employer make an offer to have any term of employment no longer determined by a collective agreement.

So, for example, individuals transfer to a new employer which wants to have nothing to do with collective agreements or trade unions.  The new employer grumbles (they usually do) but abides by the immediate terms of the collective agreement to remain on the right side of TUPE.  It then avails itself of the ability to change under TUPE 4(5B).  It makes sure the offer is not less favourable and in certain circumstances is actually more favourable as they are offering better benefits (e.g. PHI).  It would appear, however, to fall straight into the prohibition in Section 145B TULRA.

The remedy for a breach of s.145B appears somewhat confusing. Or at least it did to me.  There is the financial element (£3,600 for the employers temerity for simply making an offer in compliance with TUPE but having forgotten about s.145B and simply having made the offer) in 145E(3), which I’m calling the “temerity award”.  Then

“(4)Where an offer made in contravention of section 145A or 145B is accepted—
(a)if the acceptance results in the worker’s agreeing to vary his terms of employment, the employer cannot enforce the agreement to vary, or recover any sum paid or other asset transferred by him under the agreement to vary;
(b)if as a result of the acceptance the worker’s terms of employment are varied, nothing in section 145A or 145B makes the variation unenforceable by either party.

After a bit of double reading (and a diversion as to whether “worker’s agreeing” is grammatically correct), I would suggest (a) deals with the worker agreeing to vary, e.g. at a future point in time, but not actually varying; and (b) with when the variation has actually occurred.

If an employer complies with TUPE it can vary terms incorporated from a collective agreement, but if this means the individual will not be covered by that collective agreement then s.145B applies and prohibits the change.  But if the individual has actually varied their terms the change is effective.  If, however, the individual has not yet varied, they can presumably cherry pick the best terms and refuse to implement the variation.  Which is a bit odd or appears to contradict what Reg 4(5B) of TUPE is trying to achieve.

The only ways in which the employer avoids paying the £3,600 temerity award are, as I see it, presumably either to negotiate collectively with the trade union it does not recognise over the collective agreement it did not sign.  I can’t see a union agreeing to the change to the collective agreement.  This leaves the employer in the position of making the offer, paying the award and only then implementing the change if the employees do actually vary the contract.  Alternatively the wording of 145B(1)(a) appears to sanction picking off individual employees two by two (readers can insert their own Noah’s ark joke here) if the variations are different.

I’m unsure as to what irks me most about this.  That TUPE doesn’t work with s.145B, that I’d forgotten about s.145B altogether or that the employer will need to take a temerity award gamble on each employee’s contract it wishes to vary.  Or something else.  It might be the grammar.