Case law updates

Fire and rehire: The Supreme Court has reinstated an injunction preventing an employer from terminating employment contracts as part of a ‘fire and rehire’ exercise to change terms and conditions specifically to remove an entitlement to ‘retained pay’, a historic incentive payment that had been described as a ‘permanent’ benefit. The High Court had granted an injunction, satisfied that there was an implied term on these facts that prevented employment from being terminated to remove the entitlement to retained pay – a decision overturned by the Court of Appeal but since reinstated. This decision will not mean that employees can gain injunctions to prevent fire and rehire in all cases; the circumstances and contractual wording in this case were unusual, with the contract interpreted to include an implied restriction on the ability to terminate the contract on notice, which will not apply in all cases. Employers should nevertheless be mindful of the risk of an injunction to remove benefits that have previously been held out as permanent. The case also highlights the need for employers to take care when negotiating the longevity of certain terms. (Tesco Stores v. USDAW)

Disability discrimination: An autistic teacher has been awarded £850,000 in compensation after he was unfairly dismissed and discriminated against due to his disability. The claimant was purportedly dismissed for capability or some other substantial reason (a breakdown in working relationships) against a backdrop of repeated grievances, complaints and data subject access requests but on hearing the evidence, the Employment Tribunal (ET) found that there was no potentially fair reason to dismiss and that the school had failed to consider or understand the extent to which the claimant’s autism was responsible for his actions. The ET’s judgment from 2021 left the remedy to be dealt with separately and has only just been resolved. The award includes £75,000 for psychiatric injury, and £750,000 for injury to feelings, past and future loss of earnings and pension loss, in both cases with associated interest included. As well as acting as a reminder of the uncapped nature of compensation for discrimination, the claim also highlights the importance of not overlooking how disabilities may manifest themselves in behaviours at work. (Wright v. Cardinal Newman Catholic School)

Discretionary bonuses: The High Court has rejected a claim for breach of contract arising from the non-payment of a bonus in respect of which the claimant alleged she had received oral assurances. The contract provided for a discretionary bonus based on several factors, including company and individual performance, and the claimant had always received bonuses in the past. Having taken on a new and unusual role, the claimant alleged that she had received various assurances that she would be rewarded and continue to receive bonuses. However, when her bonus was lower than expected, she initiated a claim. On hearing the evidence, the High Court did not consider that the conversations held with the claimant could realistically or reasonably create any expectation of a bonus payment sufficient to create a contractual right, and did not consider the employer to have unreasonably exercised its discretionary powers when deciding not to award a bonus. Although turning in its specific facts, the case highlights there are circumstances where a court will uphold an employer’s right to set the level of a discretionary bonus, including making no bonus award at all despite a past history of bonus payments being made. (Gupta v. DB Group Services)

Employment status: The Supreme Court has been considering the employment status of football referees, concluding that contracts between part-time referees and their administrative body met the minimum requirements necessary to amount to a contract of employment during each period of engagement. The case, which was ultimately about tax and NIC liability, has been referred back to the tax tribunal to revisit whether the contracts are contracts of employment for tax purposes. (HMRC v. Professional Game Match Officials Ltd)

Protected beliefs: The Employment Appeal Tribunal (EAT) has been considering whether a worker’s belief in English nationalism, which extended to a belief that Muslims should be forcibly removed from the UK, amounted to a protected belief for discrimination purposes. The EAT, upholding the earlier ET’s decision, concluded that it was not. While a belief in English nationalism may have been capable of protection, the anti-Islamic beliefs that the claimant held were not. To qualify as a protected belief, five criteria must be met – this case failing on the fifth criterion, being that the belief must be worthy of respect in a democratic society, not be incompatible with human dignity and must not conflict with the fundamental rights of others. (Thomas v. Surrey and Borders Partnership NHS Foundation Trust)

To read the full newsletter, download the PDF below.