A recent Employment Appeal Tribunal (EAT) ruling has clarified the law relating to sex discrimination and dress codes at work and will make it harder for employees to claim successfully for discrimination.
In a case brought by a trainee police constable, the EAT ruled that the Metropolitan Police were not guilty of unlawful discrimination just because the detailed dress code rules for men and women were different. What mattered was whether the dress codes for both sexes were broadly similar in their intended effect and whether the sanctions for breach were the same.
The employee alleged that he was discriminated against because of his shoulder length hair. When he reported at the police training centre at Hendon, he was told that he must have it cut or face disciplinary action. His argument was his hair was slicked back and tied in a bun at the back of his head and that a woman in the same situation would not have been ordered to have her hair cut.
But the EAT held that the dress code had to be looked at as a whole, that if the code required a conventional standard of appearance and neatness, such a requirement was not discriminatory in itself, and that a difference in treatment does not necessarily amount to more favourable treatment of one sex compared with the other.
Said employment law expert Kevin Modiri of Derby-based firm Bakewells: “This ruling in Dantsie v Met Police is important because it makes it clear that, although dress codes for men and women at work must be equal, they may be different. The important thing is that the same standard of general appearance must apply - for example, a requirement for conventional smartness - also the treatment of anyone who breaches the rules must be the same.
“But beyond that, individual aspects of the code can be applied differently to men and women; so for example a requirement for employees of a merchant bank to dress with conventional smartness could mean that a man wouldn’t be allowed to wear a smart dress to work.”
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Businesses cannot expect the courts to uphold a contract for them if they provide goods or services expecting a contract to be signed, but the other party then pulls out of the negotiations and refuses to sign.
But there is some reassurance for companies, with the news that the courts brought in a little-used precedent to stop the buyer gaining an unfair advantage in the situation where no contract exists.
This is the message of a recent case - Whittle Movers v Hollywood Express – where Whittle provided distribution services expecting a six year contract to be signed, even though key terms of the deal had not been agreed.
Whilst the negotiations dragged on, Hollywood decided to sell its business and gave notice to Whittle.
When Whittle sued Hollywood to try and enforce the six year contract that had been under negotiation, the Court of Appeal held that no contract had been entered into because key terms had not been agreed.
But they did respond to claim for compensation from Whittle, made on the basis that the price paid for the work had been on the basis of a six year contract and that a short term contract price would have been substantially higher. Here, the Court of Appeal said that if the payment received by Whittle was too low, they could claim recompense on the basis that Hollywood would otherwise have received what is known as “unjust enrichment”.
Said commercial law expert Martin Jinks of Derby-based firm Bakewells: “The case is interesting for two reasons. Firstly there is the obvious point that businesses who act as if there were a contract when there isn’t one are at real risk, so the message is get everything properly agreed before you start supplying. Even though a contract may be inferred from conduct, this will not happen if key terms have still not been agreed.
“The second aspect which is interesting is around the principle of unjust enrichment. This is a Roman law concept and has only quite recently been applied systematically in English law. In this case Whittle had incurred substantial capital costs in gearing up to provide services and was expecting to pay off those costs over six years. When the arrangement ended after eighteen months they said this left them out of pocket, and the Court ruled that they could be entitled to compensation if it could be shown that Hollywood had gained unfairly.”
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Workplace bullying is in the spotlight following this week’s allegations against Prime Minister Gordon Brown and employment law experts are encouraging companies to check how they’re performing, pointing to research which suggests the problem is on the increase.
With research showing that bullying at work is soaring, employment experts are encouraging companies to tackle workplace bullying, as part of National Ban Bullying Week 2009 (16 th to 20 th November).
According to public sector union Unison, reports of bullying have doubled in the past decade and their survey of 7,000 workers found that more than one in three had been bullied in the past six months.
“Figures show that 20% of management time is spent in dealing with conflict and 50% of staff who take long term sickness are struggling with bullying issues 1 so it’s important that companies take a serious look at how much time their managers spend dealing with conflict, and how much litigation has to be handled by their lawyers.” said Kevin Modiri, employment expert with Derby lawyers Bakewells Solicitors.
“If there’s a problem, they need to take action and deal with negative behaviour. As well as avoiding the cost of employment tribunals, a good working environment pays dividends all round.”
Defending a tribunal claim costs employers an average of £20,000 and that figure is rising. Last year there were 189,000 tribunal applications - up one third from 2006. 2
Bullying at work is when someone tries to intimidate another worker, often in front of colleagues, and is often done by someone in a more senior position. It is similar to harassment, where someone's behaviour is offensive in making sexual comments, or abusing someone's race, religion or sexual orientation.
As well as the more obvious examples of bullying at work like being humiliated in front of colleagues, or physical or verbal abuse, it can include blocking promotion, malicious rumours, or copying memos that are critical of someone to others who do not need to know.
Added Kevin: “The legal position with respect to bullying is more complex than discrimination, as there isn’t a separate piece of legislation to deal with it, but there is protection for employees.
“For example, they can claim breach of contract on the basis that their employer has failed to provide reasonable support to ensure they can fulfil their job without harassment or disruption. Or there may be circumstances for claiming constructive unfair dismissal or by claiming personal injury protection, as employers have a legal duty to take reasonable care to avoid their workers suffering illness or injury.”
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The calendar, if not the weather, tells us that Spring is approaching and homeowners, estate agents and solicitors up and down the country are wondering whether 2010 will see the traditional upsurge in the property market in April and May.
The signs are confusing to say the least.
The Nationwide House Price Index showed a 1.2% rise in January, meaning that the year on year increase is 8.6%, a far cry from the apocalyptic crash forecast 12 months earlier.
Yet property analysts Hometrack say that only 7% of postcodes are experiencing an increase in house values and the Royal Institution of Chartered Surveyors tells us that its members saw the number of interested buyers fall in January for the first time in 14 months.
January’s downturn in buyers may be due to the poor weather discouraging all but the serious buyers from venturing out, but other indicators would counsel against being overly bullish.
Repossessions were at their highest level for fourteen years, at 46,000, though they were well below the figures predicted and employment figures are showing improvement now. Even so, the figures indicate that reports of the recession being over do not mean a return to the good old days.
With the weak pound pushing up the price of imported goods and the increases in oil prices, inflation is on the way up which in turn raises the spectre of interest rate increases. Nationwide predicts that interest rates will start to rise in the third quarter of 2010. Given the fact that salaries and wages are remaining stagnant, the twin threats of inflation and higher interest rates may put a lot of people off the idea of upsizing and increasing their mortgages.
This brings us to the main problem with the current UK housing market: the lack of credit available to buyers. Lenders were given a sharp reminder in 2008 and 2009 that prices can go down as well as up, and were castigated for lending imprudently. As a result, they are now applying much stricter criteria for lending than they did in the years of credit-fuelled boom. They are also conscious of the fact that they must repay £300 billion that they have received from the government under the Special Liquidity Scheme and the Credit Guarantee Scheme, which are due for repayment in 2012 and 2014 respectively.
As a result of these pressures, a first time buyer may be required to put down as much as a 25% deposit when buying their first home, a tall order when average property prices are five or six times the average wage – a fact that in itself may mean a realignment of the housing market and property values in the long term.
It all combines to create a buyer’s market for anyone with a mortgage offer, and sellers should get themselves well prepared before they put up the For Sale signs, as it could make the difference between a failed sale and a completion.
Canny sellers are instructing and making ready before they market. By ensuring their solicitor has already examined the title, anticipated any problems and dealt with them in advance, it avoids delay later and they are ready to act immediately when a buyer is found.
It seems “don’t keep a ready buyer waiting” is the clearest message for Spring.
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Companies who do business abroad are being warned to check the small print following the introduction of new regulations for transactions between European Union countries.
The Rome 1 Regulation has been introduced to clear up any confusion over which country’s laws will apply to a contract where the buyer and seller are in different countries.
But experts are reporting that it’s a new minefield for UK businesses, because the laws of two countries may be very different when applied to a contract.
For business to business contracts, parties can continue to agree and stipulate which country’s laws will apply, but if no governing law is stipulated, the Regulation provides rules for deciding which law applies.
In the case of selling to consumers in other countries, although the contract can specify the law that is to apply, there are now certain circumstances where consumers will be able to claim all the consumer protections given to them by the law of their home country.
Under the new law, this local consumer protection will apply if the seller has commercial activities in the consumer’s home country or if the seller directs its commercial activities to that country, for example by offering a French or German version of its website content.
This means that companies may find themselves dealing with completely different requirements to comply with local law and in many instances those could be much tougher. For example in some countries, supplying defective goods may incur a penalty as well as replacement of the goods.
Said Martin Jinks with Derby-based Solicitors, Bakewells: “The Rome 1 Regulation, makes it even more important to make sure that the governing law is expressly stated in any contract. Clearly written contracts make it fairly straightforward for any business to business contracts, but for companies with international sales to individuals, for example over the internet, are seriously affected by this.
“We believe a large number of companies selling online will be caught by the new definition. If they are, then they have some stark choices if they don’t want to be caught out by acting in ignorance of the local laws. It means getting legal advice on the consumer laws of each country, and then deciding whether to continue trading with consumers in those countries.”
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The Court of Protection is facing a barrage of criticism for its red tape and inefficiencies, which include relatives waiting up to six months to be given control of financial affairs.
Around 1500 complaints have been received in the 18 months since the Court of Protection - which is responsible for managing the affairs of people who have become mentally incapable - was set up.
And now the public is being advised to take action to protect themselves against any future mental illness or accident, by appointing someone to look after their financial affairs in advance.
In one example, a wife had to get the Court’s permission every time she wanted to sign a cheque for more than £500 after an accident left her husband in a coma; in another a brother was told it could take 21 weeks and incur a fee of £400 to apply for funds for increased nursing home fees.
In an interview on the BBC’s Today programme to discuss the complaints, Justice Minister Judith Prentice said she was encouraging solicitors across the UK to advise clients to make Lasting Powers of Attorney (LPAs) - a document appointing somebody to look after your affairs if you become mentally incapable.
Latest statistics show that around two million people in England and Wales lack the mental capacity to make decisions for themselves, and 15,000 people under the age of 65 have dementia.
If someone has not made an LPA and they become mentally incapable, their financial and personal affairs must be managed by the Court of Protection, through a deputy appointed by the Court. Usually the deputy is a family member, but it’s that procedure which is under fire – for being long-winded, complex, expensive and inappropriate for most families.
Having an LPA in place avoids the delay, expense and stress of applying to be appointed deputy by the court. Most importantly it gives the named deputy the authority to act without referral to the Court of Protection.
There are two types of LPA: a Property and Financial Affairs LPA, which is used to appoint someone to look after your finances; and a Health and Welfare LPA, which is used to appoint someone to deal with issues such as where you live, medical treatment, the level of care you require, and so forth.
As with any legal document, the LPA is only valid if the person signing it is capable of understanding what they are signing and its consequences, so it must be in put in place while a person is still capable.
The LPA must then be registered with the Office of the Public Guardian, which is the administrative arm of the Court of Protection, before it can be used, and the registration procedure can take two months or more – another of the sources of complaint.
Said Teresa Ruddock, probate specialist with Derby-based Solicitors Bakewells: “An LPA is just as important as a will. Although we all hope that we will remain mentally fit until the day we die, greater life expectancy means that illnesses such as Alzheimer’s are becoming more of a problem. An LPA gives a friend or family member the means to look after your affairs in the simplest and least burdensome way.
“The alternative is that some unlucky family member will be saddled with dealing with the Courts, producing annual accounts, and paying legal and Court fees until the day you die.”
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A judgment of the Supreme Court will be welcomed by all property developers, particularly those involved in large scale sites.
In Barratt Homes Ltd v Dwr Cymru Cyfyngedig (Welsh Water) the Supreme Court held that a sewerage undertaker had no power to refuse to allow a property developer to choose where to connect his private drain into a public sewer, even if connecting at that point would result in the mains sewer being overloaded.
Barratt Homes were constructing a development of 98 houses and a primary school on a site just outside a village in Monmouthshire. They constructed a foul drain to serve the development and notified Welsh Water that they wished to connect their drain to the mains sewer at a certain manhole close to the development.
Welsh Water said that connection at that point would overload the mains sewage system and offered an alternative connection at a manhole about 300 metres away.
The High Court agreed with Welsh Water but that decision was overturned by the Court of Appeal, whose judgment was upheld in a decision of the Supreme Court published on 14 th December.
The President of the Supreme Court, Lord Phillips, said that the developer’s statutory right to connect to a public sewer was an absolute right, and that the sewerage undertaker could not refuse the connection on the ground that the additional waste would overload the sewage system. The burden of dealing with the consequences of the additional waste fell directly upon the sewerage undertaker and the consequent expense must be shared between those who pay sewerage charges.
Said Martin Jinks of Bakewells Solicitors: ”This will come as welcome news to an industry that has been under siege for the last two years. Having acquired a stock of land when property prices were high, many developers are finding it hard to make a profit in the new climate and are having to fight for slender margins”.
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One in three people over 65 will die with dementia and many are leaving it too late to appoint someone they trust to make decisions on their behalf.
Latest statistics show that around two million people in England and Wales lack the mental capacity to make decisions for themselves and 15,000 people under the age of 65 have dementia.
But this month sees the introduction of a simplified way to appoint someone to look after things, if you become incapable doing so yourself.
Lasting Powers of Attorney (LPAs) were first introduced two years ago and they allow individuals to appoint someone to act as their attorney, to deal with their personal welfare or their financial affairs.
The LPA replaced Enduring Powers of Attorney (EPAs) and offered two advantages. Firstly they settled any worry about someone being pressured into the agreement, as an independent person has to certify in the LPA that the donor understands what they are doing and has not been the victim of undue influence.
Secondly, under the old-style EPA an attorney was only authorised to deal with the donor’s finances, but LPAs can be used to cover personal welfare as well.
For health and welfare LPAs, this can include the attorney making decisions on areas such as medical treatment and where the donor lives. The attorney can even be given authority to refuse life sustaining treatment.
Although the launch of LPAs was welcomed two years ago, they have been criticised for their length and lack of user-friendliness. But this week, the Office of the Public Guardian has launched a shorter and simpler form, which can be filled in on-line and printed off.
Said Teresa Ruddock, Head of Wills and Estate Management at Derby based solicitors Bakewells: ”Given the statistics, it is important that we all plan ahead while we can. Even those who have done an EPA should take advantage of the fact that LPAs give them the opportunity to appoint someone to look after their personal welfare”.
“And for those already suffering from the onset of dementia, it’s important to find a lawyer who understands your situation,” she added.
Bakewells provides advice on legal and financial matters for people suffering from dementia through the Alzheimer’s Society as a member of LawNet - a network of independent, quality assured law firms throughout the UK and Ireland.
For more information, contact Teresa on 01332 348791.
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Families are being urged to talk sooner, rather than fight later, following last week’s high profile case of disinherited university lecturer Christine Gill, who won back her family’s £2.3million farm when the court declared her mother’s will invalid.
Said Teresa Ruddock, Head of Wills and Estate Management of Derby-based solicitors Bakewells: ”The outcome on this case is really the exception, not the rule. Generally it’s very expensive to contest a will; the occasions on which it’s successful are few, and sadly it often signifies the end of relations between family members. People need to talk and perhaps more importantly, they should regularly review their will. “
The judge gave the verdict after hearing that Christine Gill was given repeated assurances that she would inherit the family farm in North Yorkshire and had shown years of devoted support and care for her ageing parents.
The High Court in Leeds ruled that her reclusive mother had been bullied into making the will, leaving everything to the RSPCA, by her over-bearing husband before his death. The judge was satisfied that Mrs Gill had “an avowed dislike” of the RSPCA and wanted her daughter to inherit the farm, but that she had been unduly influenced by her husband.
Teresa added: “We really need to get inheritance out of the closet. There’s often a rather British reserve about discussing these things, but it would be better all round if families were more open – rather than dealing with the aftermath when it turns out that Aunt Bessie left everything to the dogs home.”
“It’s also very important to review your will, rather than thinking it’s a one-off final document. Things change, new children are born and perhaps old grudges settled. In this case, if the mother had thought to review the will after her husband died, things could have been resolved quite simply.”
If you would like more information on making or updating a will, please contact Teresa Ruddock at Bakewells on 01332 348791.
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With a landmark European ruling allowing workers to claim back holidays lost due to sickness, employment law experts are urging employers to take the initiative in tackling the new requirements, to avoid being caught out.
Kevin Modiri, Employment expert, at Derby-based lawyers Bakewells said: “This is a new style of duvet day – a Sunshine Sickie ruling - that could cost businesses thousands in lost working hours, unless they prepare themselves to avoid abuse.”
The ruling is effectively a new interpretation of the European Working Time Directive on workers' hours, which applies in Britain across the entire private and public sector.
Delivered this week, the ruling by the European Court of Justice held that workers on sick leave during what would otherwise have been their holiday, have the right to take annual leave “at a time other than originally scheduled, if necessary outside the corresponding reference period”.
This will allow employees who are ill during holiday leave to request it be ‘reallocated’ to another time, including carrying their annual leave over into the next holiday year. If employers fail to allow the revised holiday slots they risk an employment tribunal under a breach of the Working Time Directive.
Kevin added: “To avoid abuse by employees, companies need to take action now to update their employment contracts. The principle applies no matter what is in your current contract of employment, so you can’t contract out of this, but a well drawn contract of employment can ease the burden of the ruling.
“It’s a complex area where companies will need specialist technical advice. It may change in future, but the new ruling doesn’t specify how or when employees should notify their sickness, so employers can ask for convincing evidence to prove the sickness would have made them unfit for work. That could include asking for a doctor’s note, in addition to any usual self certification procedure.”
He added: “Taking time to ensure employees understand company policy now could pay off later.”
For more information, please contact Kevin Modiri at Bakewells Solicitors on 01332 348791.
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The clock is ticking for companies in the final countdown to the new Companies Act , which comes into effect on 1 st October 2009 and will affect every company in the UK.
This is the final stage of implementation for the 2006 Act, but many companies are still unaware of the impact of the new law, according to local company law specialist, Martin Jinks, Senior Partner of Derby-based solicitors Bakewells.
“In this final changeover period, companies need to make sure they’ve completed any business with Companies House under the 1985 Act well before the end of September,” he explained.
“And they need to be ready to use the new system in October. That means being registered and ready to file electronically, as well as understanding the new responsibilities involved.”
“Once that’s sorted, they should be reviewing what might be useful to adopt under the new Act. For example, the simplified articles of association that can now be adopted, which can help to avoid confusion around corporate power.”
New model forms of constitution allow simplified company articles to include the company’s objects, liabilities and assets – all of which were previously in the company memorandum.
The new constitution prescribed by the Companies Act will form the basic constitution of all companies formed after 1 st October. Existing companies can also adopt the simplified constitution, but will have to hold a shareholders meeting to do so.
It’s part of a complete overhaul of the company formation and administration process, which is set to be easier and cheaper in future, including increased use of electronic reporting and filing.
There are wholly new forms for recording company activity including the annual report, and many of the new forms record different information.
Added Martin: “Any company events which take place before 1st October must be submitted on the old 1985 Act forms. But after that, the new forms must be used for anything that takes place on or after 1st October 2009 - and anyone using the old forms will find they are rejected.
“With electronic WebFiling it should be an easy process, with menu screens to guide you through.”
On the downside, all companies will have one month less to file accounts, with the filing period reduced to nine months for a private company. Penalties for late filing have doubled.
Any amendments to the company’s articles after 1 st October must be sent to Companies House within 15 days, otherwise you could be liable to a criminal offence and a civil penalty of £200. And company records must be up to date and consistent with what is held on public record, so changes must be notified when they happen, not just on the Annual Return.
To guard against fraud and company hijacking, Companies House have introduced the PROOF scheme - Protected Online Filing – which protects companies from unauthorised changes to their company details. Under PROOF, companies agree with the Registrar that they will only file certain documents electronically. If a fraudster tries to ‘hijack’ their company by filing a piece of paper, this will be rejected.
Directors’ duties and shareholders rights are now set out in statute and companies can indemnify directors. Raising of share capital and takeovers; political donations; and auditor liability are also covered.
Other key changes relate to a change in procedure for company registers and confidentiality for directors’ home addresses through new disclosure protection. Every director will have a publicly available service address whilst the residential address will only be available to public authorities and credit reference agencies. From 1st October a director’s current residential address will automatically become the service address, so companies need to take action to file any requests to use an alternative service address.
The changes to the arrangements for inspecting a company’s registers now allow for registers to be held either at the registered office address or at a single alternative inspection location – known as a SAIL. Companies House must be notified if you establish a SAIL address or if the SAIL address is moved, and a company can only have one SAIL address at any time.
The new legislation also brings together the whole of the UK into a single company registry, with Northern Ireland company registry integrating with Companies House.
Checklist:
For more information, please contact the Company & Commercial Team at Bakewells on 01332 348791.
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Important changes to the National Minimum Wage are set to come into force on 1 October, and a local solicitor is advising all businesses that employ low-paid people, or have staff who receive tips from customers, to familiarise themselves with the changes.
“First, the rates are going up,” says Kevin Modiri of Bakewells in Derby. “For workers aged 22 or over, it will rise from £5.73 to £5.80 an hour. It will go up from £4.77 to £4.83 an hour for people aged 18 to 21. And it will rise from £3.53 to £3.57 an hour for 16 and 17-year-olds.”
Using tips to raise staff pay to the Minimum Wage will be outlawed on the same date. “When announcing this change, Pat McFadden, who is now the Minister for Business, Innovation and Skills, said that it was not right for employers to use tips meant as a bonus for staff to boost pay levels to the legal minimum,” Kevin continues.
“This is certainly commendable, but there is a possibility that some businesses may experience an increase in their costs which could force them to shed staff.”
Kevin is keen to emphasise that Bakewells is very experienced at helping businesses ensure that they fulfil all their legal responsibilities, including compliance with the requirements of the National Minimum Wage. “If you have any concerns about what these changes may mean for your business, please call us on 01332 348791 to arrange a meeting.”
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A local solicitor believes that the outcome of a recent court case, which prevented a newly divorced woman from claiming more money from her former husband after the value of his shares rose sharply, has important implications for many separating couples.
According to Victor Collins of Bakewells in Derby, “This couple agreed a lump sum payment when they got divorced in 2006, which was based on the estimated value of a company in which he was a major shareholder. The following year, however, it was sold for more than four times this estimate, causing her to reopen their divorce case.
“However, the husband successfully argued on appeal that his situation was no different from someone who, having agreed a settlement, saw the value of their assets collapse due to the credit crisis. In both cases, the original agreement was based on an unknown financial future – in this particular instance on the ‘highly speculative’ value of his shareholding.”
Victor recommends strongly that people considering a divorce should bear in mind the potential for significant future fluctuations in either partner’s fortunes. As he says, “When reaching an agreement, it is possible to allow for an unknown future by ensuring that special clauses are in place. This is particularly important if one or other of the partners possesses assets that are of an unknown or possibly changing value.
“At Bakewells, our specialist family lawyers are highly experienced in ensuring that agreements are fair to both parties, removing the areas of uncertainty that have plagued so many. Please call us on 01332 348791 to arrange an initial free, no obligation meeting.”
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