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UK: Redundancy: Offer of suitable alternative employment

In a redundancy situation, where an employee unreasonably rejects an offer of suitable alternative employment, they forfeit their right to a redundancy payment.

The Claimant was a bookkeeper whose employment was transferred to the Respondent after her previous employer went into liquidation.  She was faced with possible redundancy and tried to agree hours and duties with the Respondent. However, she eventually refused an offer of alternative employment which in addition to bookkeeping duties involved some work in a warehouse. The Respondent did not pay her statutory redundancy pay on the basis she had unreasonably refused an offer of suitable alternative employment. Only when the Claimant later brought a tribunal claim did she reveal that the alternative employment offered was not suitable because her leukemia meant that she could not work in the cold warehouse.

The EAT said that where an employee has refused an offer of alternative employment and the employer therefore does not pay their statutory redundancy pay, the employer must show that:

– the alternative employment offered was suitable
– the employee’s refusal to accept that employment was unreasonable.

Further, if the employee subsequently brings a claim, the tribunal may take into account reasons the employee had for refusing the alternative employment even if they did not raise them with the employer at the time.

Employers must ensure they follow a fair redundancy process, including exploring suitable alternative employment opportunities for affected employees. If an employee refuses an offer of alternative employment, the employer should seek to explore fully with the employee the reasons for their refusal before denying them their statutory redundancy pay.

For more information, please contact L&E Global.

UK: TUPE – Employee Liability Information: whether terms are contractual

Under TUPE, when there is a transfer the outgoing employer must provide the new employer with employee liability information which includes all the terms which must be given in an employee’s statement of particulars.

In this case, in the employee liability information provided to the new employer, the employees’ Christmas bonus was included in a list of non-contractual employment terms. However, following the outsourcing of printing services, it transpired that the bonus was contractual and the new employer brought a claim for failure to provide accurate information.

The EAT said that the outgoing employer does not have to specify whether or not any part of the remuneration is contractual.

The provision of employee liability information can be a difficult issue for the new service provider – the outgoing contractor may not cooperate in providing this information to them, and often there will not be warranties or indemnities for them to rely on. So incoming contractors should aim to find out as much as they can in the due diligence process and build in protection in the initial contract.

When providing employee liability information, outgoing employers should not state whether terms are contractual or otherwise.

For more information, please contact L&E Global.

Spain: Supreme Court changes criterion on the obligation to record the working day

An employee organisation brought a lawsuit against its company, because it did not have a system of registry for the working day.

As a result of this claim, the Supreme Court has established its criterion on the obligation to register the working day, canceling previous pronouncements of the National High Court.

The Supreme Court exempts companies from the obligation to keep a record of the daily work of the entire staff to verify the compliance with the agreed timetables. It considers that the Workers’ Statute only requires, except in the case of a covenant, to keep only the record of the overtime worked and to communicate its number at the end of the month, if it has been done, to the worker and to the legal representative of the workers.

For more information, please contact Bufete Suárez de Vivero, S.L. our member firm in this country.

Netherlands: Without a proper improvement plan, the request for dissolution of an employment contract based on poor performance fails

The employee entered into the employment of the employer on January 1, 2012 as Project Manager. The employer requested the court for dissolution of the employment contract on the basis of (primarily) poor performance, (alternatively) because of an impaired working relationship and (as a final alternative) based on the ‘catchall ground’.

The appeal based on poor performance fails. The sole circumstance that there are points for improvement is insufficient for the judgment that the employee does not perform properly. More circumstances are needed to be able to substantiate an appeal based on poor performance, such as an unsuccessful improvement plan. In the improvement plan, the employer must explain specifically and in a clear way – based on concrete examples – what the poor performance is based on, what the employer exactly expects from the employee in his/her job and in what way or by what means the employer expects the employee to be able to achieve the intended improvement. However, no improvement plan was prepared by the employer in this case. Since 2014, the employer has mentioned development goals, but the forms in which this has been laid down do not contain any guidance nor offer a time-limit to the employee to improve his performance. Therefore, there was no valid improvement plan. As a result, the appeal based on poor performance fails.

The appeal based on an impaired working relationship and on the ‘catchall ground’ also fails. The employer has failed to sufficiently substantiate that the employment relationship has been impaired. Furthermore, the judge was of the opinion that the employer seeks to repair the insufficiently substantiated poor performance ground by requesting the court for dissolution of the employment contract based on the ‘catchall ground’. However, this ground is not intended as such. The court denied the dissolution.

It is very important for the grounds for dismissal be sufficiently substantiated. If an employer is not able to do so, it is high likely that the court will deny the request for dissolution.

For more information, please contact Palthe Oberman our member firm in this country.

Italy: It is lawful to dismiss an employee who participates in a soccer game during his absence due to sickness

The Court of Cassation (ruling no. 10647/2017) held that it is lawful to dismiss for just cause an employee who was found to have taken part in two soccer matches, during sick leave, which he was granted to allow him to heal from an ankle distortion reported as a result of injury at work. The Supreme Court held that the conduct so seriously undermined the foundation of trust and the relationship between the employer and the worker that it would not allow the continuation of the employment relationship.

For more information, please contact LABLAW – Studio Legale our member firm in this country.

Italy: Disciplinary procedure not promptly started: Reinstatement of the employee

The Court of Cassation (rule no. 2513/2017) stated that a disciplinary charge not promptly reported to the employee by the letter of charge shall be considered unfounded. The company’s delay in charging the conduct/misconduct precludes the Court from establishing whether or not the “fact” has happened and therefore to evaluate the seriousness of the behaviour.

For more information, please contact LABLAW – Studio Legale our member firm in this country.

Germany: A hidden video surveillance requires an initial suspicion of a crime

The Federal Labor Court has confirmed its case law that violations of data protection laws do not generally lead to the inadmissibility of evidence, which is obtained under such violations. The inadmissibility of evidence only comes into consideration in case the realization of such evidence interferes with the employee’s general right of privacy. Interferences with the rights of third persons are not sufficient.

Nevertheless, the decision of the Federal Labor Court points out that the employer has to evaluate possibilities and, if possible, take less intrusive measures before installing video surveillance. Otherwise, he risks that the results of such video surveillance may be inadmissible in court.

For more information, please contact Pusch Wahlig Legal our member firm in this country.

France: The dismissal letter cannot be signed in the name of the employer by a person who is not from the company

Notification of dismissal lies with the employer. However, the latter can give a mandate to an employee of the company, an employee with the quality and the required skills, to proceed in his place. In such a case, it is sufficient for the employer’s representative to act on behalf of the employer in order for the procedure to be lawful. That said, the employer cannot ask a person outside the company to conduct the dismissal procedure and sign the letter. Otherwise, the dismissal is judged as being without a real and serious cause.

The Court of Cassation has just recalled this principle concerning the accountant of the employer who cannot take the place of the employer to conduct the interview prior to dismissal and sign the dismissal letter. The reason for this is simple: the very purpose of the preliminary interview, which should enable the parties to explain the dispute in progress, prohibits the employer from giving a mandate to a person who is not even part of the company.

For more information, please contact Flichy Grangé Avocats our member firm in this country.

China: Companies should be able to check employee’s medical records and decide whether or not to approve the sick leave application

In one of the ten typical labor arbitration cases recently released by Zhejiang Province, Ms. Chen applied for sick leave by WeChat with the sick leave certificates issued by two hospitals. However, the HR manager learned that Ms. Chen was shopping during her sick leave period, so the Company requested Ms. Chen to submit relevant medical records, examination reports, and other illness supporting documents, and complete the written sick leave application process. Ms. Chen answered stating that she did not have those medical documents, and could not complete the written application due to her physical condition, so the Company unilaterally terminated her employment contract for the reason that she obtained sick leave by cheating.  The labor arbitration commission dismissed Ms. Chen’s claims for reinstatement of employment and held that the Company has the right to check an employee’s medical records and relevant hospital material in order to decide whether or not to approve the sick leave application. Since Ms. Chen failed to provide the medical records and examination reports related to the symptoms stated in the sick leave certificate without reasonable explanations, the Company’s termination of her employment contract was legitimate and should be sustained. In view of this case, we suggest that employers should establish a comprehensive sick leave management system to specify the sick leave application procedures and the documents required, besides the sick leave certificates, such as a sick leave application form, medical registration forms, medical records, examination reports and receipts of medical fees.

For more information, please contact Zhong Lun Law Firm our affiliated member firm in this country.

Canada: Ontario Court of Appeal upholds “harsh” and “draconian” bonus eligibility language

In a recent decision, the Ontario Court of Appeal upheld a lower court’s decision to enforce strict bonus eligibility language in an employment contract. The plaintiff had been employed in the position of Vice President and Division General Counsel under a negotiated written contract. The employment contract clearly spelled out how the employer’s bonus plan worked, as well as the circumstances in which the plaintiff would become ineligible to receive a bonus. In short, the contract specified that the plaintiff would only be eligible to receive a bonus if he was employed at the time of the bonus being paid. The agreement also set out several examples to demonstrate how this rule would apply in various circumstances to clarify the eligibility language.

The plaintiff was terminated on a without cause basis approximately five months in advance of the bonus payout date in 2010. The employment contract entitled the plaintiff to only eight (8) weeks’ notice of termination, which fell significantly short of the bonus payout date. Consequently, the employer took the position that the plaintiff was not entitled to any bonus payment.

The plaintiff sued for wrongful dismissal, and claimed entitlement to a bonus. The plaintiff claimed that the bonus language in the employment contract was unenforceable on various bases, including that it was illegal, ambiguous, and contrary to public policy.

The Superior Court of Justice upheld the employer’s bonus eligibility language on the basis that it was very explicit (including the use of examples), and that there was no ambiguity with respect to the circumstances in which a bonus would be payable. Although the effect of the language was harsh, the Court found that a harsh provision could still be enforceable if both parties had agreed to it.

On appeal, the Court of Appeal found that the relevant terms of the contract were fully compliant with the employment standards legislation. The Court of Appeal agreed with the trial Court’s reasoning that “[p]ublic policy would be ill served by permitting the plaintiff to accept a potentially lucrative position with the full knowledge that it contained a potentially unfavourable limitation clause and then to complain when that clause was actually executed”.

This decision is a positive one for employers following a number of decisions in which Ontario courts (including the Court of Appeal) have been hesitant to enforce contractual language limiting a dismissed employee’s entitlement to a bonus. This case indicates that where bonus limitation and termination language is clear, explicit, and compliant with minimum employment standards legislation, it will be enforced. Notably, the plaintiff in this case was particularly sophisticated, so it remains to be seen whether courts will respond similarly to a more sympathetic plaintiff.

For more information, please contact Filion Wakely Thorup Angeletti our member firm in this country.