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UK HR Two Minute Monthly: covert surveillance; holiday carry over; sexual orientation discrimination; interim relief

Summary

Our December 2019 update outlines the key UK employment law developments over the last month. It includes cases on covert surveillance, sexual orientation discrimination when there is no identifiable victim, harassment under the Protection from Harassment Act 1997, the doctrine of state immunity as it applies to British civilians working in the UK for a foreign state, the test for interim relief in whistleblowing claims and the latest ECJ decision on holiday carry over in sickness absence cases. We also outline other points of note, including the Government’s response to the Women and Equalities Committee report into the use of NDAs in discrimination cases and an independent review of the international evidence on the impact of minimum wages.

Covert CCTV surveillance to monitor workplace theft was not an infringement of employees’ right to privacy under Article 8 ECHR

The European Court of Human Rights has held that the Spanish courts did not fail to protect the Article 8 ECHR rights of employees when they upheld their dismissals based on footage obtained from concealed cameras in the workplace.

The employees worked as supermarket cashiers. An investigation was launched after significant stock discrepancies were identified, which included installing both visible and concealed cameras. Notices were put up in the supermarket to inform customers and staff that CCTV was being used, but staff were not told about the concealed cameras.

The covert CCTV helped identify the five cashiers who were involved in the thefts and all were dismissed. Their unfair dismissal claims

UK HR Two Minute Monthly: religious discrimination; third-party harassment; investigations

Summary

Our November update considers recent developments in employment law, including cases on religion and belief discrimination, third party harassment and investigations. We also outline other points of note, including the new EU Whistleblowing Directive and the EHRC’s Guidance on NDAs.

Dismissal not unfair where in-house counsel recommended changes to investigation report

The EAT has held that a dismissal was not unfair where a draft investigation report prepared by HR and an investigator was altered on the recommendation of in-house counsel.

In this case, the in-house solicitor had advised the investigator to remove his evaluative opinions and conclusions of whether the employee’s conduct amounted to misconduct, and to limit the findings to whether there was a prima facie case to answer. This was on the basis that the conclusions should be left to the disciplinary panel that was subsequently appointed.

The EAT upheld the Tribunal’s decision that the overall dismissal was still fair as there was no evidential material that had been withheld from the investigation report for review by the disciplinary panel.  As part of this decision, the EAT took into account that the appeal hearer (who was a barrister) reviewed the draft investigation reports and did not find that the report was changed in order to make the employee’s dismissal more likely, and no pressure had been applied to the investigators.

Why this matters?

This case is a useful reminder about the scope of the investigator’s role in a disciplinary procedure.  At the outset of an investigation, the

THE ACCIDENTAL SUCCESSOR: Asset Buyers Must Take Care to Avoid Unintentionally Becoming a “Perfectly Clear Successor”

October 31, 2019

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Asset Buyers, beware.  If the Seller has union-represented employees, and you intend to hire some or all of those employees and operate the assets as a union-free employer, take care to avoid becoming an accidental successor.

As a recent decision of the D.C. Circuit Court of Appeals reminds us, the terms of the asset purchase agreement (APA) and all communications with Seller’s employees – by both Buyer and Seller – must be carefully managed.  Otherwise, Buyer can accidentally become a “perfectly clear successor” that is required to:

  • initially honor the terms of the existing collective bargaining agreement (CBA),
  • recognize the current labor union as the bargaining representative of the unionized Seller employees whom Buyer hires, and
  • bargain with the union over the terms of a new CBA for those employees going forward.

THE ASSET BUYER’S OPTIONS

Under the National Labor Relations Act, if an asset Seller has union-represented employees, and Buyer wishes to hire some or all of them and operate the assets, Buyer has three basic options:

  • Assume the CBA. Buyer will be bound by the terms of the CBA from the Closing Date and will be obligated to recognize the union as the bargaining representative of the employees covered by the CBA.  In most cases, the union will have no duty to bargain over changes to the CBA until the CBA is ready to expire – perhaps years after Closing.
  • Try to remain union-free. If it declines to assume the CBA, Buyer will normally be

New Overtime Rule More Employer-Friendly Than Last Attempt

Today, the U.S. Department of Labor finally announced its long-awaited changes to the regulations regarding overtime compensation. Effective January 1, 2020, the minimum salary required for most exemptions under the Fair Labor Standards Act will rise from $455 per week to $684 per week (or from $23,660 to $35,568 annualized). The minimum salary for the “highly compensated employee” exemption will rise from $100,000 to $107,432 per year.

Additionally, employers will be permitted to use nondiscretionary bonuses and other incentive payments (including commissions) to satisfy up to ten percent (10%) of the required minimum salary, as long as that compensation is paid at least annually. And if an employee fails to earn sufficient incentive compensation in a 52-week period to maintain “exempt” status, the employer may make up the shortfall (up to 10% of the minimum required salary) in a one-time payment in the first pay period after the end of the 52-week period.

The “final rule” announced today is more employer-friendly than the Department’s last attempt to update the overtime regulations, which was enjoined by a federal court in 2016 before the changes could take effect. The final rule issued in 2016 would have raised the minimum salaries for exemption considerably higher, making an estimated 4 million workers eligible for overtime pay, and it would have provided for automatic increases in the salary thresholds going forward. The final rule announced today is predicted to make 1.3 million workers overtime-eligible and does not provide for any automatic adjustments in the future.

U.S. Department of Labor Proposes Changes to Minimum Salary for Overtime Exemptions

On March 7, 2019, the United States Department of Labor issued a notice of proposed rulemaking that would change the minimum salary levels necessary for an employee to be properly classified as exempt from the overtime compensation requirements of the Fair Labor Standards Act.  Under the proposed rule, the minimum salary for most exemptions would rise from $455 per week ($23,660 annualized) to $679 per week ($35,308 annualized).  The minimum annual compensation for the “highly compensated employee” exemption would rise from $100,000 to $147,414.

For employees in the executive, administrative and professional exemptions, the proposed rule would permit nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to ten percent (10%) of the required minimum salary.  In addition, provided that the employee has received at least ninety percent (90%) of the required minimum compensation in each payroll week for 52 weeks, the employer would be permitted to make a single “catch-up” payment within one pay period after the end of the 52-week period, in order to bring the employee’s compensation to the required level.

For “highly compensated employees,” the proposed rule would require that ten percent (10%) of the minimum annual compensation be paid in the form of a weekly salary, but the remainder could be paid in the form of nondiscretionary bonuses and incentive payments.  In addition, the rule would also permit a “catch-up” payment as described above.

The proposed rule would formally rescind the Obama-era rule proposed in 2016, which was blocked by permanent injunction before it

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