Saturday 29th September 2012 at 12:28pm
Reinstatement: an exchange
After my last post remarking that only 5 orders for reinstatement or re-engagement were made by Tribunals in 2011-2012, a regular reader of this site Mark wrote to me on the subject of reinstatement, as follows:
“Here is a hypothetical case where re-engagement would work well. You worked for Mega Plc, a large diversified organisation, each of whose separate divisions has considerable autonomy and its own culture/ identity. You were sacked from your job in the Spoonmaking Division and are re-engaged to work in the Forkmaking Division. Now as far as the forkmakers are concerned, your tribunal judgment is yet more confirmation of what they have believed for years: that the spoonmakers are a ‘cut below’ who are good at getting things wrong. This is a very rare scenario.”
“Most people who think they have been unfairly dismissed harbour feelings of distrust of and hostility towards the employer. Whatever the decision of the tribunal, the employer is likely to continued to believe that they were in the right, or at least continue to say it. The return of a sacked employee is almost always likely to be intolerable to the employer: s/he is a standing reproach, turning up for work every working day, a reminder that somebody [i.e. a Tribunal] thought they had got it wrong. The employee will suspect that they are unlikely to be surrounded by, shall we say, loving feelings toward them, and that very likely the employer will just have another go. And I exclude from this the considerable number of dismissed people – often particularly those who have experienced bullying – who cannot bear to walk past the former employer’s premises, let alone set foot on them.”
It is definitely true that the majority of employers fight reinstatement; but I struggle to think that their dislike of the reinstated employee has any real justification. You have to remember that most dismissals are “no-fault” dismissals. Very many more people are sacked each year for redundancy, retirement, or medical incapability than are for misconduct. And even in a misconduct dismissal, a finding of unfairness will in practice only be made where there was something irrational about the dismissal. EG the last one I won was for a worker who failed a drugs test, where the company had a drugs policy that said it would ordinarily encourage workers to great treatment, rather than dismissing them for a first offence and it simply hadn’t followed its own policy. A manager ought to be grown up enough to say “ok, we got that wrong”.
If you look back forty years ago, when we had no unfair dismissal system, but most workplaces had internal appeals against dismissal, and reinstatement rates were 20-33% (compared to today’s figure of less than 1%) I can’t help but think that the higher reinstatement rates reflected a greater maturity in society’s general understanding of managers and workplaces – i.e. these were worlds of competing interests, and differences of opinion, where mistakes could be made and corrected, in contrast to the modern view which is that a manager should be a benign autocrat watching over a subject workplace with technology giving them a total vision of what’s going on. The “Alan Sugar” model of management suggests that people should be grateful to their bosses, maybe even their prisoners; without ever really explaining where managers’ “betterness” is supposed to come from.
Also the notion that most employers are too small to allow re-engagement seems to me to be a prisoner of that neo-liberal logic in which employer’s groups always complain to the press about the rights of small businesses, even where what they’re really fighting for is the rights of the very largest employers, and do so so routinely that we forget the ideology that lies behind what they’re saying. The Federation of Small Business reports that there are 29 million workers in the UK of whom just under 14 million work for employers of 250 or less people. But those figures must mean that a slight majority of UK workers are employed in companies of more than 250 people, and if the typical worker is in a company of around this size (maybe a bit smaller, maybe a bit bigger) that seems large enough to me so that reinstatement should usually be feasible.
I definitely agree that most employees are unenthusiastic about reinstatement (although I think their unwillingness would be less if we could dramatically reduce the time it takes to hear a dismissal claim). But I think part of this is because workers underestimate (often dramatically) how long it will take them to find a job comparable to the one they have lost, in terms of stability, pension rights, pay, etc.
Mark has now replied as follows:
“I completely agree that more employers could do reinstatement, should be less protective of their mistakes, and ought to look at employment interest-group relations, in the way you suggest they may once have done. But, of course, ‘could, should and ought’ is not the same as ‘is’.”
“I am certain you are right that most dismissals are for redundancy, retirement and medical incapacity. But most of these dismissals do not end up in tribunals. Most of the dismissed will think their dismissal was ‘fair’, and even when someone thinks, say, that s/he has been unfairly selected for redundancy, she may well curb an urge to litigation: it’s a no-fault dismissal, accompanied by a decent reference, a payoff, and the opportunity to claim contribution-based benefits. Most UDL cases are about Conduct or Capability. Perhaps the opportunity of a decent no-fault compromise agreement would have suited some of these claimants better than the tribunal process, ‘win’ or ‘lose’.”
“A great problem lies with the nature of UK grievance and disciplinary procedures, and often with performance procedures. They closely resemble the criminal justice process, and they are in practice about apportionment of blame and judging guilt. Some sort of Japanese -style- no-blame process would be much healthier. It may be that the widespread adoption of such processes could transform the UK workplace and its productivity.”
“I think if we went back in time, say fifty or sixty years, we would find that management was in general more authoritarian, controlling, and demanding of deference than it is now. But what made a difference was the relatively greater power of the workers under their control, compared with today, in an environment of full employment, or even labour shortage, strong unions, and in many (especially larger) workplaces, greater solidarity between people of the same occupation, and greater self- identification with a social class. Contrast today: high unemployment, no unions or weak unions, and growing individualism.”
“In the context of mentioning individualism, I will note the disappearance of the paternalistic organisation, typically rule-bound and hierarchical, but having an affiliative attitude, and bound by unwritten contracts of social obligation.”
“I don’t think myself that neoliberal ideology operates directly to form the beliefs of employers and managers. But neoliberalism does operate very powerfully at one remove. It is conventional to look at the post-war quarter- century, and say that full employment and the growing share of national income going to labour, were underpinned by a system of fixed exchange rates, and controls on the movement internationally of capital and labour [the latter by law and de facto: e.g. the people of soviet eastern Europe could not escape]. A managed system of trade in manufactures was mainly between first- world developed countries. With countries producing in a, relative-to- today, narrow range of labour costs, trade in manufactures was based mainly on considerations of comparative advantage and product differentiation”
“Now compare today: the high unemployment and falling returns to labour [and falling real incomes lately] are underpinned by the abolition of capital controls in an expanded world, now including the former- communist second world, and much of the third world. International trade is a now essentially a system of labour- cost arbitrage, for example, taking advantage of low labour costs to manufacture goods in Vietnam, and making often breath-taking profit by selling in higher- labour- cost Britain. Technology has permitted the outsourcing overseas of some services, for the same reason, the seeking of higher returns to capital, e.g. Indian call centres, software and data processing. With necessarily less effect on profitability, even non- internationally tradable activities (e.g. haircuts, bricklaying and sandwich -making) have been subjected to the same remorseless logic.”
“The fundamentals are at the level of political economy, with the Law following. The only way to get real change is to change the political economy. The New Economy is brewing up powerfully poisonous liquor.”
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Monday 18th June 2012 at 5:55am
Yunus Bakhsh v Northumberland Foundation Trust; testing the limits of the Tribunal’s inability to re-engage
Where a claimant succeeds in a claim for unfair dismissal and the employer is ordered by the Tribunal to re-engage or reinstate the claimant but fails to do so, a Tribunal has the power to order additional compensation of not less than 26 and not more than 52 weeks’ pay, but the Tribunal has no power to enforce the order of reinstatement (section 117 Employment Rights Act 1996).
If the employer is a public body, can the Claimant enforce the original order of re-engagement against them, by a claim for Judicial Review?
In a case concerning a former candidate for General Secretary of the nurses’ union UNISON, Yunus Bakhsh, whose reinstatement the employer refused, essentially on the basis that it feared he would use re-engagement to renew his trade union activities, the High Court has granted permission to the Claimant to bring his claim.
For non-lawyers, that doesn’t mean he has won his case, only that he has got over the first hurdle; there will now follow an ordinary High Court hearing for Judicial Review.
The interim view of Mr Justice Foskett was that a claim such as Bakhsh’s could only very exceptionally succeed. But one factor which troubled Foskett was the reason given by the employer for refusing re-engagement, which appeared to be a very plain infringement of Bakhsh’s freedom of association under article 11 ECHR.
Again for non-lawyers: Judicial Review is a limited remedy, all it means is that the public body has made an unlawful decision, it is then required to make a fresh decision. In some areas of JR it is wholly common for the decision maker to be successfully challenged and the decision overturned, only for the decision maker to take the same decision as before, if perhaps with better reasons, and the case to remain in the courts, clogging them up for some time, without reaching a final outcome.
That reservation aside, this case matters: if Bakhsh was to succeed then it would open up a hole in the wall of resistance facing Claimants who want nothing more than their job back.
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Friday 15th June 2012 at 6:00am
Reinstatement and re-engagement; revisited
Regular readers of this blog will be well aware of my longstanding complaint that Tribunals pay too little attention to the option of reinstatement but advance on the basis of a false assumption that reinstatement will always be an unrealistic solution.
It’s nice to find the senior employment judiciary in agreement. In last year’s case of King v Royal Bank of Canada Europe Ltd [2012] IRLR 280, HHJ Richardson referred a case back to the Tribunal where a bank worker’s redundancy dismissal was automatically unfair under the old statutory dispute resolution procedures (i.e. unfair because no fair procedure had been followed), but the Tribunal accepted there was no alternative decision and capped her award to two months’ wages.
Richardson J’s findings are set out in the IRLR’s headnote (emphasis added):
“The tribunal had not complied with the statutory requirement of the ERA 1996 s 112(2) Q [736] to explain to the claimant the possibility of reinstatement or re-engagement. This has always been a difficult point because of the monumental gap between the theory of the ‘primacy’ of these remedies and the year-on-year statistics that show that they are simply not awarded in practice. Normally it makes little difference if Homer nods vigorously at this point in proceedings. However, this case shows that a tribunal may still have to be careful, at least sometimes, because on the facts here the claimant had actually mentioned reinstatement in her ET1 and had referred to re-engagement in her witness statement. In those circumstances at least it remains an error of law not to comply with s 112(2). Indeed the judgment (at para 55) goes further and states that ‘compliance with s 112 is a valuable discipline for the purpose of ensuring that important issues relating to reinstatement and re-engagement are not overlooked’, though it must also be pointed out that the judge did acknowledge that under the older authority of Cowley v Manson Timber Ltd [1995] IRLR 153, CA it is not automatically an error of law for a tribunal not to comply with the section; given that tribunal procedure is supposed to be being simplified, to add a requirement of active consideration of remedies that normally no-one wants could be seen to be regressive. However, this decision does place more emphasis back on the section, at least where there is some mention of these remedies by the claimant (though of course there is then always the cynical argument that that mention may only have been to up the ante for a financial settlement); the balance here is notoriously difficult.”
In a week where the Coalition has been setting out new powers for employers to railroad employees through very one-sided “compromise agreements” the case is also of interest for the dim view Richardson took of the Respondent’s procedure for dismissing staff, which had consisted of (i) inviting the employee to a meeting, (ii) explaining that they were going, (iii) putting them on immediate garden leave, (iv) providing no appeal and (v) offering a financial settlement by way of a compromise agreement. Such a procedure, Richardson J stated, was likely to lead to hasty and ill-considered managerial decisions and to be a complete dereliction of an employer’s duty under statute and good practice, all the more unacceptable in a large organisation with professional management, including an HR department.
And speaking of HR departments, it will be noted that within the Coalition’s plans for introducing statutory penalties for employers who breach employment law, there is a proposal that these quasi-aggravated damages will apply in circumstances including where the employer has “a dedicated HR team“.
It is at least hoped that that reform, combined with decisions such as the one above in King, remind personnel managers that their presence is supposed to result in more, not less, compliance with minimal employment standards.
Hat tip to Paul Ratcliffe
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