Employment case law update April 2020

A number of key employment law cases of significance for employers have recently been decided.

Vicarious liability

WM Morrisons Supermarkets plc v Various Claimants [2020] UKSC 12 and Barclays v Various Claimants [2020] UKSC 13

On 1 April 2020 the Supreme Court handed down two judgments in Barclays Bank Plc v Various Claimants [2020] UKSC 13 and WM Morrisons Supermarkets Plc v Various Claimants [2020] UKSC 12 in which the Court appears to be moving against vicarious liability.

In the first, the Supreme Court found Morrisons not to be vicariously liable for mass data breach caused by a former employee. The decision reversed that of the Court of Appeal by finding Morrisons was not vicariously liable for the actions of the rogue employee, who had posted payroll data of 100,000 other employees on a file-sharing website.

This decision is good news for compliant businesses that nevertheless come under fire as a result of data breaches and other acts perpetrated by malicious employees.

In Barclays v Various Claimants, the Supreme Court’s decision has effectively limited the expansion of the relationship akin to employment between an employer and independent contractor. The decision will be of particular interest to businesses which employ independent contractors in the so-called ‘gig economy’.

In both cases the Supreme Court made it clear that the motivation of the wrongdoer is still very relevant and an employer would not normally be vicariously liable for any staff members seeking revenge. However, the Court also noted that in some cases, there may be some underlying connection to work which would result in employer liability.

Long-term disability benefit and the meaning of ‘return to work’

ICTS (UK) Ltd v Visram [2020] EWCA Civ 202

An employee was rightly compensated for loss of entitlement to benefits under a PHI policy when he was unable to ‘return to work’ following sickness absence.

On its correct interpretation, the phrase ‘return to work’ in the relevant clause meant return to the work he had been doing when he went off sick, not a return to any work.

If the latter had been the intention, it would have been possible to include a provision to that effect.

This is another example to employers of where the courts have found in an employee’s favour when determining entitlement to contractual benefits, in circumstances where the policy document covering the entitlement was ambiguously drafted.

In the absence of an express term in the contract, there is an implied term that those in receipt of PHI will not be dismissed if this will affect their right to this benefit.

The decision also highlights that in a TUPE transfer, all of an employee’s rights under their employment contract transfer to the incoming employer – it is critical that if you are the transferee employer, you identify what those rights are, and the possible risk that covert surveillance can lead to an award of aggravated damages.

Whistleblowing

Gilham (Appellant) v Ministry of Justice (Respondent) [2019] UKSC 44

Following the Supreme Court ruling, all judges now enjoy the right to pursue whistleblowing complaints in the employment tribunal. Beyond this, further implications arise from the judgment.

One is that occupations and office holders outside of judges could also be covered by recognition that an occupational classification is capable of amounting to an ‘other status’ for the purposes of the non-discrimination principle in Article 14 of the European Convention on Human Rights (ECHR).

In addition, while this case concerned the interplay between Article 14 and Article 10 (freedom of expression), there are many other employment rights which have been found to be within the scope of other ECHR rights. In certain circumstances, unfair dismissal has been found to engage Article 8. Trade union and collective consultation rights are within the scope of Article 11. Wages and pension issues may be within the scope of Article 1 Protocol 1. The Supreme Court’s landmark decision potentially calls upon the government to justify why the existence of a contract is the pre-requisite for protection in a wide array of instances. Article 14, which has hitherto played only a limited role in employment cases, certainly has untapped potential.

Legal disclaimer

The matters contained in this article are intended to be for general information purposes only. This article does not constitute legal advice, nor is it a complete or authoritative statement of the law, and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its accuracy and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should be sought.