Case Law Round Up - Employment Law News Autumn 2005

01 October 2005

Holiday pay during long term sick leave

The Court of Appeal’s (CA) decision in Commissioners of Inland Revenue v Ainsworth and others held that, the right to four weeks statutory paid holiday under the Working Time Regulations 1998 does not continue to accrue whilst a worker is off on long term sick leave, having exhausted their entitlement to contractual and statutory sick pay. This overturns the earlier Employment Appeal Tribunal (EAT) decision of Kigass Aero Components v Brown (2002). The case also decided that, if a worker is claiming the non-payment of holiday pay, they are no longer able to claim backdated holiday pay representing a series of deductions over a number of years.

Compromise agreements

The CA decision in Hinton v University of East London held that, it is not sufficient for employers to simply include in a compromise agreement a general release clause, followed by a list of claims that may or may not apply to the individual in question. The case is a stark warning to employers who use off the peg compromise agreements that are not tailored and/or do not cover and list all potential claims that have been raised or are contemplated. It is important that the compromise agreement sets out clearly what is agreed between the parties so that both parties are clear as to the precise nature of the claims the employee is waiving when signing the agreement.

Agency worker or end user employee?

The EAT decision in Cable and Wireless plc v Muscat is another in a long line of cases that follow the CA decision in Dacas v Brook Street Bureau (UK) Limited (2004). Employment tribunals are now looking behind the contractual documentation to establish the true nature of the working relationship between the agency worker and the hiring end user. If, in practice, there is mutuality of obligation and sufficient day to day control exercised by the end user over the agency worker, there is likely to be an implied employment contract between the two. It now seems probable that if an agency worker is retained for 12 months or more by the same end user, they will qualify for the right not to be unfairly dismissed by the end user (and acquire other employment rights).

For more information please contact Andrew Masters, Partner & Head of Employment.
 

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