Employment Law Watch : Employment & Labor Lawyer & Attorney : Reed Smith Law Firm

Lessons for Employers in a Social Media World

This post was written by Don Innamorato and E. David Krulewicz.

Recently, in Stengart v. Loving Care Agency, the New Jersey Supreme Court held that an employee had a reasonable expectation of privacy in her Internet-based emails to her lawyer, despite the fact that she sent such emails from a company-owned laptop and was on notice of the employer’s written policy that emails may not be considered “private or personal.” The opinion is significant not only in recognizing a privacy interest for employees’ communications to their attorneys using company-owned-and-monitored networks, but also in providing important guidelines for employers drafting or updating their policies on use of email and the Internet. In addition, Stengart issues a warning to both in-house and outside counsel involved in the forensic review of employees’ computer-based data and communications.

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Regulations concerning the new right to additional paternity leave (APL) came into force on 6th April 2010. Currently those eligible for ordinary statutory paternity leave are entitled to one whole week or two consecutive weeks’ paternity leave on statutory paternity pay, which is currently £124.88, to be taken within eight weeks of the expected week of childbirth (EWC). However, eligible fathers whose children are due on or after 3 April 2011 will have the right to take up to 6 months’ additional paternity leave (APL). The right will also apply to adoptions where parents are notified of a match on or after 3 April 2011 and husbands, partners or civil partners who are not the child’s father but expect to have the main responsibility (apart from the mother) for the child’s upbringing.

Continue reading our for a summary of the new provisions regarding Additional Paternity Leave.

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The subject of leave and pay has caused a number of headaches for employers over recent years. Recent cases have sought to clarify this area of the law, however, many questions remain unanswered. One of the most confusing areas relating to leave is the interaction between sick leave and annual leave. What happens when a worker is off sick and therefore does not take his/her accrued holiday? Do workers accrue annual leave whilst off sick? Read on for a summary of the recent cases which have sought to answer some of these questions.

Accrual of annual leave during sick leave

In Stringer and Others v HM Revenue & Customs, the European Court of Justice (ECJ) held, in respect of questions refered to it by the House of Lords, now the Supreme Court (HL), that:

• workers on sick leave must continue to accrue annual leave;
• it is for Member States to decide whether workers can actually take annual leave during sick leave; and
• if workers are prevented from taking annual leave during sick leave, they must be able to take it following their return to work, even if this means carrying the annual leave over into the next holiday year.

The HL has now determined how these principles should be applied in the UK. Regulation 13(9) of the Working Time Regulations 1998 (WTR) states that “leave.... may only be taken in the leave year in respect of which it is due”. The parties agreed that statutory annual leave could not therefore be carried forward to the next holiday year. The HL held that it was therefore necessary to interpret the WTR as allowing workers on long-term sick leave to take (and be paid for) annual leave whilst on sick leave.

However, this case raises as many questions as it answers. For example, what happens if the worker does not request annual leave whilst on sick leave? Does the employer have to permit annual leave to be carried forward in these circumstances, despite the WTR? Many of the points raised by the ECJ were not fully considered by the HL, and therefore the manner in which the ECJ’s decision might be interpreted under UK law remains uncertain.

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Overview

During the past year, there have been a number of cases which have impacted on the area of dismissals. We consider the major cases below:

Unfair dismissal

In order for a dismissal to be fair, an employer has to show:

1. that it has a potentially fair reason for dismissal; and
2. that the dismissal is reasonable in all the circumstances.

When assessing “reasonableness”, the Tribunal will look at the employer’s dismissal procedure to see whether it satisfies this test.

In West London Mental Health NHS Trust v Sarkar, the Employment Appeal Tribunal (EAT) held that an employer acted reasonably in dismissing an employee for gross misconduct under its formal disciplinary procedure, despite initially taking the view that the misconduct could be dealt with under an informal procedure designed to deal with less serious matters.

It was found that the employer was entitled to consider further incidents of poor conduct which occurred and justified a change in approach.

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The past 18 months has seen a significant number of TUPE related cases. The following is a summary of some of the key decisions.

The meaning of the term `activities’ (Service Provision Change)

A TUPE transfer will occur when there is a ‘service provision change’. In a first-generation outsourcing, where a client outsources an activity to a contractor for the first time, the conditions to be met in order for there to be a service provision change include a requirement that ‘activities’ cease to be carried on by the client for itself and are instead carried on by the contractor on the client’s behalf. As TUPE does not include a definition of ‘activities’, it has been for the Courts and Tribunals to consider how this issue should be approached.

In Metropolitan Resources Ltd v Churchill Dulwich Ltd, the Employment Appeal Tribunal (EAT) decided the activities carried out by the transferee must be ‘fundamentally or essentially the same’ as those that were carried out by the transferor in order for a TUPE transfer to occur. The EAT also indicated in its decision that in assessing whether the activities are similar, a more detailed rather than an ‘overview’ approach should be adopted (i.e. consideration should be given to the exact nature of the activities performed by each of the transferee and the transferor and the exact manner in which those activities are performed).

Further support for the adoption of a detailed approach can be found in the EAT’s decision in OCS Group Ltd v Jones and another. Here, the EAT decided that a contractor which provided catering services to a client by preparing hot and cold meals in on-site kitchens performed activities that were different to those of a contractor which only sold pre-prepared sandwiches and salads. The EAT rejected the ‘overview’ approach argument that the activities carried out by each of the transferee and the transferor in this case should be considered to be the provision of food or catering services and should therefore be considered to be the same.

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On April 7, 2010, the Internal Revenue Service (“IRS”) issued the form employee affidavit that employers can use to claim a payroll tax credit for newly hired employees, made available under the Hiring Incentives to Restore Employment (“HIRE”) Act that was recently signed into law.

As noted in our earlier client alert on the HIRE Act, the law contains two key tax breaks that are available to most employers, including businesses, agricultural employers, tax-exempt organizations, tribal governments, and public colleges and universities. First, it exempts an employer from paying its share of Social Security payroll taxes (normally 6.2 percent) in 2010 for any unrelated employee, hired after February 3, 2010 and before January 1, 2011, who (1) swears under oath that he or she did not work more than 40 hours during the past 60 days, and (2) was not hired to replace another employee, except one who voluntarily resigned or was terminated for cause. To demonstrate that an employee’s hiring meets the first of those tests, employers can have qualified employees sign the form affidavit, also known as a Form W-11.

Second, the Act offers a tax credit to businesses that keep a newly hired qualified employee for at least 52 consecutive weeks, so long as the employee’s wages during the last 26 weeks of that period are at least 80 percent of his or her wages during the first 26 weeks of the period. The credit is equal to the lesser of $1,000 or 6.2 percent of the employee’s wages during the 52-week period.

Additional information about these tax credits available to employers, including a useful set of FAQs, is available at the IRS website.

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A little-noticed provision of the new health care reform law requires employers to provide new mothers with “reasonable break time” to express breast milk for nursing children who are up to 12 months old. Section 4207 of the Patient Protection and Affordable Care Act (P.L. 111-148), 29 U.S.C. § 207(r)(1), amends the Fair Labor Standards Act (“FLSA”) to require employers to allow a break each time that such an employee needs to express milk, and a place to do so, other than a bathroom, that is “shielded from view and free from intrusion by coworkers and the public.” Because Congress did not specify an effective date for this requirement, it went into effect March 23, 2010, when the president signed the bill.

Although the new law applies to employers of any size, those with fewer than 50 employees need not provide such breaks if they can demonstrate that doing so “would impose an undue hardship by causing the employer significant difficulty or expense when considered in relation to the size, financial resources, nature, or structure of the employer’s business.”

The law provides that employers need not compensate employees for any work time that they spend taking such breaks, an exception to the FLSA’s usual rule that breaks of less than 20 minutes must be treated as compensable time. Employers should keep in mind, however, that more generous state laws may trump that exception.

Because the law does not preempt state laws that offer greater protection for nursing mothers who work, and 24 states and the District of Columbia have passed laws that apply to such employees, employers should be sure to check local law before deciding how to proceed.

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In force from today are a number of legislative changes which will be of interest to employers. These include the new right to request time off to train and the replacement of sick notes with “fit notes”. Also expected to come into force today are various regulations relating to additional paternity leave which will affect parents of babies born or expected to be born on or after 3^rd April 2011 and parents who are notified of having been matched for adoption on or after that date. For the moment, however, they still appear in their draft form but will no doubt come into force shortly.

New right to request time off to train

From 6 April 2010 employees working for employers with 250 or more employees have a new right to request time off to train. As from 6 April 2011, the right will extend to all employees, regardless of the size of their employer. The right will be available to employees only (not to other “workers”) and is subject to a qualifying period of service of 26 weeks. Employers are required to consider all requests seriously and follow a prescribed procedure. They may only refuse a request if they think that one of a number of specified business reasons set down in section 63F(7) of the Employment Rights Act 1996 apply. An employee whose application is refused can bring a claim before an Employment Tribunal but their remedies are limited to compensation of up to eight weeks’ pay and/or an order for the employer to reconsider the application.

For more information see the Government’s business link website

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