March News Articles
Long term sick ‘entitled to holiday pay’
Employees on long term sick leave are entitled to claim their annual holidays, according to the advocate general of the European Court of Justice.
Verica Trstenjak added that sick workers who are laid off by their employers should be given pay in lieu of holidays not taken. Ms Trstenjak was commenting on a case involving employees of HM Revenue and Customs.
The employees, who had been off sick, won the right to claim their holiday entitlement at an employment tribunal under the EU Working Time Regulations. The Court of Appeal reversed that decision and the case then reached the House of Lords which asked the European Court of Justice for an interpretation.
The Court is now considering the case but it tends to reach the same conclusion as the advocate general in most cases. If it does follow the advocate general’s opinion then it may push employers into taking tough decisions about how they deal with employees on long term sick leave.
We shall keep clients up to date with developments.
Man disabled in car crash awarded £6.3m damages
A man who was left disabled after suffering brain injuries in a car accident has been awarded £6.3m compensation.
David Dei-Ceci, from Newcastle, was going on a camping trip when the car in which he was a passenger crashed into a field. Mr Dei-Ceci, who is now 23, was 17 at the time of the accident. He had just finished college and was hoping to start work as a mechanic.
He sustained serious brain injuries and will need constant care for the rest of his life. He will never be able to work again. His claim for compensation was made against the insurers of the driver of the car.
The award of £6.3m was made at the High Court in London. The money will be managed by the Court of Protection and can only be used to provide Mr Dei-Ceci with the care and comfort that he needs.
OFT acts against letting agent’s terms and conditions
The Office of Fair Trading (OFT) has begun proceedings in the High Court to prevent the letting agents Foxtons Limited from using its current terms and conditions.
The OFT says it is taking the action in response to complaints from consumers.
A spokesman said: “The terms to which the OFT objects in Foxtons' letting agreements can potentially require landlords to pay Foxtons substantial sums in commission, where a tenant continues to occupy the landlord's property after the initial fixed period of the tenancy has expired - even if Foxtons plays no part in persuading the tenant to stay, and no longer collects the rent or manages the property.
“Foxtons' terms can also require the landlord to pay these sums after the landlord has sold the property. The terms also demand commission where the landlord sells the property to the tenant, even where Foxtons has played no part in negotiating that sale.
“Foxtons contends that its agreements with landlords are not unfair and continues to use these terms, and accordingly, the OFT has issued proceedings so the courts can decide the matter.”
The OFT is seeking an enforcement order against Foxtons under the Unfair Terms in Consumer Contracts Regulations 1999 which protect consumers against unfair standard terms in contracts with traders.
If the OFT is successful, it plans to prevent similar terms and conditions being used throughout the letting industry.
Court of Appeal rules on rights of agency workers
The Court of Appeal has ruled that agency workers do not have the same rights and protection from dismissal as staff employed by a company direct.
The case involved Merena James who worked for the Borough of Greenwich for three years while employed through two different agencies. She took time off work though illness in 2004. When she returned she found her place had been taken by another agency worker.
Ms James claimed unfair dismissal but lost her case at the employment tribunal which found that there was no contract of employment between her and the council, nor was the fact that she had worked for the council for a period of time enough in itself to create such a contract.
That ruling was upheld by the Employment Appeals Tribunal and now by the Court of Appeal. The court rejected the submission that there was an implied contract between Ms James and the council.
Lord Justice Mummery said: "Ms James was not an employee of the Council because there was no express or implied contractual relationship between her and the Council. Her only express contractual relationship was with the employment agency, as she recognised when she changed agencies rather than employers in order to obtain a higher wage. The Council's only express contractual relationship was also with the agency.”
The ruling will be welcomed by many businesses that employ agency workers. Firms should still be careful when drawing up paperwork, however, and make sure not to refer to agency staff as employees or deal directly with such things as holiday and sick pay. That should be left to the agency. It should be remembered that although agency workers may not be able to claim unfair dismissal in the same way as employees, they are still protected by anti-discrimination laws.
Cost of regulation for businesses soars to £65.99billion
The cost to business of regulations introduced since 1998 has risen to £65.99billion, according to research carried out for the British Chambers of Commerce (BCC).
That includes a rise of £10billion in just the last 12 months.
The BCC says the uncomfortable truth for the Government is that the costs keep increasing in spite of two Acts of Parliament designed to reduce the burden - the Regulatory Reform Act 2001 and the Regulatory Reform Act 2006.
The research was carried out for the BCC by the Manchester and London business schools using Government figures. The findings, known as the Burdens Barometer, lists a top ten of offending pieces of legislation.
The BCC highlights two in particular which it believes the Government should review. These are the Data Protection Act, which has cost business more than £7billion over the last decade, and the Flexible Working (Procedural Requirements) Regulations 2002 which have so far cost business £1.588billion.
Sally Low, Director of Policy for British Chambers of Commerce said: “We desperately need an Impact Assessment system that will challenge the need for regulation and a parliamentary process established that provides real independent oversight.”
It remains to be seen to what extent the Government will act to reduce the regulatory burden but in the meantime companies need to ensure that they comply with legislation relevant to their business. Failure to do so could lead to increased costs and fines.
Government clarifies when HIPs are needed
The Government has issued guidelines to clear up any confusion about the need for Home Information Packs (HIPs) when selling a house.
HIPs have been compulsory when selling houses of all sizes since December. However, many sellers and estate agents have since questioned what exactly constitutes the marketing of a house and whether informal or one-off viewings trigger the need to provide a HIP.
The Department for Communities and Local Government has issued a statement pointing out that the “a property is put on the market when the fact that it is available for sale is made public”.
That means when it is advertised to the public or a section of the public in any way. Even letting people know by word of mouth will count as marketing.
However, one to one sales that do not involve any other person or marketing to the public are not included in the legislation.
The statement points out that when someone acting as an estate agent introduces a seller to a buyer then a HIP will be needed. “This means that the HIP duties will usually be triggered where an estate agent, as part of his business, arranges ‘informal or one-off viewings’ of a property that is available for sale, or communicates this availability by any means to anyone as part of an attempt to sell it.”
HIPs are still quite new so it is not surprising that there should still be some uncertainty about them. Please contact us if you would like more information about HIPs or any aspect of buying or selling a house.
Divorced wife gets her maintenance payments doubled
The High Court has doubled the amount of maintenance a man must pay to his former wife because his income has increased considerably since they divorced six years ago.
The couple had been married for 11 years and had two sons. During the marriage the wife agreed to sacrifice her career to look after the children leaving the husband free to concentrate on his work. When they divorced they agreed on a one-off lump sum and periodical payments of £33,000 a year for the wife together with extra money for the two children until they were 17 or until they had finished their education.
After six years the wife applied to have the payments increased on the basis that her husband’s income had risen considerably whereas her earning capacity remained limited because she had devoted her time to bringing up the children.
The High Court held that the wife’s current earning capacity was indeed far less than it would have been had she continued her career after the birth of the second child. By staying at home she had enabled her husband to pursue his career and also spared him the cost of employing a nanny.
The couple’s joint decision that she should give up her career put her at a disadvantage financially and this should be taken into account in the payments she received from her husband. It was also significant that a large proportion of the child maintenance would no longer be available to her as the children reached 17 or finished their education.
The court ruled, therefore, that the periodical payments to the wife should be increased to £65,000 a year in keeping with the increase in the husband’s income.
Court overturns will of woman who lacked testamentary capacity
A woman has succeeded in overturning her mother’s will after taking legal action to revoke the grant of probate.
The mother, who had five children, made a will in 1993. She appointed her two youngest sons as executors and left them half her estate. The other half was to be divided between her grandchildren and her cousin. There was no provision for her other three children.
The woman died in 2004 and probate was granted to her two youngest sons as executors. This gave them the right to administer the estate in accordance with the will.
However, the woman’s daughter then sought to have the grant of probate revoked on the basis that her mother lacked testamentary capacity when she made the will and so it could not be taken as a reflection of her true wishes.
The daughter was able to show that her mother had a long history of mental illness. An expert witness said she would not have been capable of considering the issues properly when making the will. The sons offered no contradictory evidence about their mother’s mental health or any evidence as to the validity of the will.
The court therefore felt bound to conclude that the mother lacked capacity when she made the will. The grant of probate was revoked and the matter will now be dealt with as if the mother had died without having made a will. This means the estate should now be divided equally between the five children.