Sickness in the workplace
Short-term intermittent absence
Serious condition or long-term absence and dismissal
March 2009 NICE recommendations
Dismissal during sick pay entitlement
If the employer is unhappy with the sick note ? Malingering ?
Notice and Sick pay :unable to work for the notice period
Disabled people : symptoms in remission or dormant
Long term illness and sick pay
Context
Stress at work, psychological problems, back pain, RSI, chronic physical
conditions … handle the issue well and improve employee relations.
Sickness: Monitoring
Employers should ensure they have a robust system for monitoring and
tracking sickness absence. It is quite common for single days off to fall
through the monitoring net and if this happens it creates difficulties
down the line.
It also quickly leads to complaints of unequal treatment if employee A
feels employee B has had time off work that is not being picked up.
Staying in touch
An employer is entitled to stay in touch with the employee. This could be on a weekly or fortnightly basis, depending upon the circumstances. Unfortunately one of the biggest single causes of absence from the workplace is stress. Employers need to be careful to handle contact with employees suffering from stress or other psychological or psychiatric conditions in a balanced way that is both effective and appropriate.
Dealing with sickness absence
Short-term intermittent absence
If an employee is regularly unwell and has time off work for short periods the employer should speak to the employee, firstly informally and then if the problem continues the employer may have to implement a disciplinary process modelled on the capability process : this is not misconduct.
Serious condition or long-term absence and dismissal
If after clearly establishing the medical position the employee is unlikely
to return to work in the foreseeable future, dismissal may be a justified
response. The employer should consider all the alternatives and be mindful
of potential claims under disability legislation.
Some employees offer contractual fringe benefits: permanent health insurance
(PHI) schemes and ill health early retirement pensions. The employer should
liaise carefully with any scheme providers to ensure the scheme rules
are followed.
Normally an employer should consider
• the nature of the illness,
• prospects and timing of return,
• length of service,
• the possibility of ill health retirement,
• overall the reasonableness of keeping the job open.
March 2009 NICE recommendations
NICE has published some useful guidelines on managing sickness.
http://www.nice.org.uk/Guidance/PH19
Dismissal during sick pay entitlement
The standard rate for Statutory Sick Pay is £75.40 a week
28 weeks
Nothing for the 1st 3 days.
Whilst it is not necessarily always unfair to dismiss an employee before
their sick pay entitlement has been used up, dismissal within this window
is a factor that a tribunal will consider.
If the employer is unhappy with the sick note ? Malingering
An employer must look carefully at any report or sick note from the employee’s
GP.
It is often desirable to get a fuller report from an independent qualified
medical practitioner. Some GP’s are overtly hostile to participating in
what they see as the employer’s contractual process. Others write very
short reports that may not protect the employer if a claim is made.
If the employer suspects that the employee is malingering ?
Malingering & Dismissal
M. was off sick for stress. M. took a day trip to France His employers
dismissed him on the grounds of misconduct. The EAT held that the employee's
trip was justifiable because the reason for his absence was stress and
the trip might have improved his condition.
McMaster v Manchester Airport 1997
T was a penalty fares inspector who went off sick with stress after a
disagreement with her manager. Her employer M. withheld payment of contractual
sick pay. M.’s view was that T was absent from work because she was angry/annoyed
not illness.
The EAT held that in the absence of contradictory medical evidence once
a medical certificate had been produced it was not open to an employer
to go behind what appeared on the face of that medical certificate. At
the initial stage the employer was entitled to express doubt as to the
reason for the employee's absence. However, once her GP had certified
that the employee was suffering, as in this case, from acute stress reaction,
and that that was the cause of her absence from work, any initial doubt
was removed.
Merseyrail Electrics-v- Taylor 2002
An employee took part in a union demonstration when he was off sick. The EAT stated that if there is evidence to suggest that an employee is fit to work, despite having a sick note, an employer can rely upon that evidence to justify a dismissal.
Hutchinson v Enfield Rolling Mills Limited 1981
M, a crane driver, suffered from back problems which he said caused him
to be absent from work. Employer C received a tip-off from a colleague
of M’s suggesting that his behaviour outside work was inconsistent with
his being genuinely off work for back problems. C did not take a witness
statement from the informant but arranged video etc surveillance of M
that showed him carrying out activities such as unloading shopping from
the boot of his car.
C subsequently sought an opinion on the video footage from the doctor
who had originally said he was not fit to work, who reported that had
M informed him that he was capable of undertaking the tasks shown in the
video footage, he would have recommended that M was fully fit for work
with immediate effect.
M was subsequently dismissed on the grounds that he had dishonestly reported
himself as unable to work through illness when he was, in fact, fit to
work.
C lost in the ET.
The tribunal held that the dismissal was unfair as C had not taken a statement
from the informant, and had also not shown the video footage to a consultant.
C. won in the EAT
The EAT overturned that decision and found that the information from the
informant was not included in the investigation and there was no evidence
that C had relied upon it.
As a result, the lack of a statement from the informant was not relevant
to the reasonableness of the investigation or the decision to dismiss.
As to obtaining the report of a consultant, the question was one of reasonable
belief;
Did the doctor’s view together with the evidence of the video footage
allow C to conclude reasonably that M was malingering ?
If so, there was no need to investigate further.
Mainwaring v Corus UK 2007
Honest belief-
reasonable grounds-
fair procedure
Conclusion
If employer believes that an employee’s sickness is not genuine,
• obtain proper evidence
• take independent medical advice
• do not withhold company sick pay;
An employer with proper evidence, as opposed to suspicion, that an employee
is not genuinely ill can challenge a sick note; “full scale malingering”
is dishonesty and justifies dismissal.
It may be acceptable for employees who are off work sick ( e.g. with stress
or anxiety) to go on holiday;
If private investigators are used they should be instructed to act sensitively
and discreetly and they should be told that, under no circumstances are
they to enter the employee’s home; and
Despite the above caveat, generally employment tribunals have taken the
view that all relevant evidence should be admitted, regardless of how
it was obtained. Such considerations may have costs or other legal implications,
however; in one case an employer who obtained evidence “unethically” had
to pay the costs of the hearing into the admissibility of the evidence.
Jones v University of Warwick
Notice and Sick pay; if employee is unable to work for the notice period.
Quick Summary
Employees with minimum statutory notice periods who fall sick during the notice period are entitled to full pay even if they are unwell. However if the contract has extended the notice period by say 1 week, they would only be entitled to SSP.
This is the position subject to the ECJ decision in Stringer, February 2009 ( see below).
Our experience is that there is very often a problem with employees falling sick during notice periods.
Financially this becomes more relevant once employees have clocked up longer service or if they are on a higher salary. If an employer thinks this is a risk area, it should look at contractually extending the statutory notice period by one week.
Disabled people : symptoms in remission or dormant
An employer dealing with potential disability issues has to make a proper
and balanced assessment of the disability and the impact upon the employee’s
long term ability to work. 3 examples:
1 Mr. A. applies for a job as a waiter, but has recently broken his leg
and is on crutches. He will be fully recovered in 4 month’s time and disability
discrimination does not come into play. However the employer B. needs
a waiter now, and not unreasonably decides not to employ Mr. A. , but
instead employ a waiter who can do the work needed; the employer cannot
be faulted for this.
2 Ms. B. applies for back room accounting job at the same restaurant
but has chronic spinal problems. She can work full time and seems very
competent. She needs specially designed ergonomic seating and a modified
keyboard stand, and would need a handrail on one staircase : which costs
several hundred pounds. The employer has a duty to consider making reasonable
adjustments and should not discriminate against her in selection.
What if Ms. C. has a serious health problem (e.g. psychiatric history)
but is in remission, with no active symptoms?
3 This was the issue in McDougall v Richmond Adult Community College
2008 CA .
Ms. M. applied for a job as a database assistant, and was offered the
job subject to satisfactory health and other standard checks. She was
refused employment because of a history of schizophrenia; she had not
had any symptoms since 2005 but there was a risk of recurrence. At the
time of application she was quite well.
After the employer rejected her application for employment on health grounds,
she applied to the Employment Tribunal which held that in the particular
circumstances she was not disabled, and not protected by the DDA.
She was successful in her appeal to the EAT, but was unsuccessful when
the employer took the case to the Court of Appeal.
As fate would have it some months after being rejected for employment
her symptoms flared up again and she was re-admitted to hospital.
The Court of Appeal held the employer had to assess the history and make
a proper assessment of the likely future course, having regard to available
medical information.
What actually happens after that process is not to be taken into account:
the important issue is the calibre of the contemporaneous assessment.
The risk of the disability recurring has to be worked out at the time
of the job application.
What happens afterwards might inform us afterwards as to how well that
was done but is otherwise irrelevant.
Sick pay and long term absence
HMRC v Stringer” – sick pay and long term absence
The European Court has decided has upon the sick pay rights of long term absent employees.
• statutory holiday entitlement clocks up as normal throughout the sickness absence
• employees may ask to take holiday whilst on sick leave (see detail below).
• it must be rolled over if it cannot be taken because the worker is off sick
• if dismissed workers must be paid for accrued entitlement at their normal rates (see detail below);
The House of Lords (HoL) must now follow this ruling and overturn our Court of Appeal's decision. In theory employers can wait until HoL applies the ECJ ruling to English law – the HoL decision is scheduled for 2010. However once the HoL does issue its decision it will in effect apply retrospectively and employees who have not been paid their accrued rights could bring claims for them. Employers wishing to be seen as having good policies may prefer to anticipate the change that will become law : although there are some tricky points especially in relation to the carrying forward of leave and the Working Time Regulations.
The ECJ’s decision is consistent with most but not all of the views of its Advocate General, a judicial official who considers cases and publishes an opinion (Stringer-v- HMRC) before the ECJ decision..
Practical Points
Public sector workers
Annual Leave : detail
Payments in lieu of notice (PILON)
The detailed legal arguments
Practical Points
• This case relates solely to statutory minimum holiday entitlement under the WTR, which is currently 24 days per year, rising to 28 days in April 2009. Employers can contract that leave in excess of this amount does not accrue on sick leave, and is not paid out in lieu on termination. So - review your holiday policies and contracts of employment and check this is made clear.
• Employers who dismiss an employee on long-term sick leave because that employee has sought to take annual leave can of course be sued for unfair dismissal under section 101A of the Employment Rights Act 1996.
• Check for any Disability Discrimination Act issues before dismissing staff on long-term sick leave – overlooking this is risky as there is no limit to compensation for disability discrimination.
• Some employers operate permanent health insurance (PHI) benefits for their employees. PHI policies often stipulate that an employee must be employed to get the policy pay out, commonly a substantial percentage of salary, paid monthly. With the obligation to pay holiday pay It will now cost employers more to keep long term sick on the payroll and employers are as a result disincentivised from operating PHI schemes.
What can employers do to lessen the impact?
Robustly manage all sickness absence.
Consider reducing contractual sick pay entitlements to offset additional
holiday cost.
Ensure that employment contracts provide that contractual leave over and
above the statutory minimum does not accrue during sick leave.
Public sector workers
Should now be able to rely on the Directive itself to claim compensation for untaken carried over leave.
Annual Leave : detail
The ECJ has ruled it is for member states to decide individually whether annual leave can be taken during a period of sickness. In the UK that may mean that employers can contract or exercises their rights under the WTR to restrict the timing of leave workers can take. However this may simply be leaving the worker with a bill for annual leave not taken, or a carry forward .
It is possible that a worker who has used up his sick leave allowance will still be entitled to be paid for bank holidays as these are normally part of the contractual holiday allowance.
A worker who is unable to take their annual leave because of sickness absence (whether absent for the all or part of the year) must be allowed to carry over leave into a later leave year. The meaning of “unable” is going to have to be decided : as UK law allows holiday to be taken during sick leave, workers are certainly legally able to take paid annual leave whilst off sick (unless their employer or a relevant agreement says otherwise), and so arguably are not “unable” to take leave.
The House of Lords will have to issue a judgment in Stringer, which is scheduled for 2010, and may resolve this issue then.
If the House of Lords decides that the Directive permits workers to carry forward leave in some circumstances, this will raise an issue with the Working Time Regulations which at present stipulate clearly that leave can only be taken in the leave year in which it accrues. The WTR may have to be amended.
Payments in lieu of notice (PILON)
The ECJ has ruled, as the Adv-Gen recommended, that workers on sick leave for all or part of the leave year the right to a PILON of leave not taken on termination of employment; calculated according to the worker's normal remuneration. Employers cannot contract to reduce the amount of the terminal PILON.
The ECJ ruling means this PILON should include a payment in lieu of leave not taken and carried over from a previous year. This contradicts the language of the WTR so either the House of Lords interprets / purposively reads words in or the WTR will have to be amended.
The detailed legal arguments
There were 2 questions
1. Does the directive entitle a worker on sick leave to accrue annual leave while absent and/or to take that annual leave while absent.
2. Is an absent worker is entitled to a payment in lieu of untaken annual leave upon termination of employment.
1.The right to paid annual leave starts on the very first day of employment
and continues to accrue during a period of sickness absence. In this finding
ECJ has disagreed in part with the earlier decision of the Court of Appeal.
Paid annual leave is a fundamental social right. To exclude workers on
sick leave would be to limit that right and to apply a condition to that
right that prevents certain workers from enjoying it.
One form of leave guaranteed by community law should not affect another.
The specific purpose of sick leave is to recover from an illness ( per
the Advocate General “the causes of which were outside the worker's control”).
Annual leave, on the other hand, is meant to allow rest.
2. The right to take paid leave during employment, and the right to receive a payment in lieu on termination (PILON) cannot be separated. The PILON entitlement includes payment in lieu of holiday accrued during a period of sickness absence, but not yet taken, as this allows employees to take their "rest" before starting a new job.
An absent worker is entitled to a payment in lieu of untaken annual leave upon termination of employment.
The UK’s WTR do not permit or require holiday accrued but not taken to be carried over from one year to the next. The Adv-Gen's opinion appears to imply that this should be allowed; and she has recently advised this on a reference from a German court.
If you are thinking about grumbling about the European Court, or celebrating
that HMRC lost in these cases , before this kicked off, in Kigass back
in 2002 our very own EAT decided that workers can claim and take annual
leave during a period of sick leave – including long term sick leave.
This was later reversed by the Court of Appeal in Ainsworth, 2005. However
it is worth at least looking at the arguments in Kigass, which are rather
more down to earth than those in the Adv-Gen’s opinion.
The Kigass workers were absent from work for the whole of the leave year – so they had not actually worked any working time in that leave year. Rejecting the employers' main argument was that annual leave is leave of absence from normal 'working time' the EAT identified 2 fairness arguments:
1. Laid off workers should be able to take holiday during the period of lay-off.
2. An employee who worked 46 weeks without taking any annual leave, but then fell ill for the remainder of the year, should be able to take the annual leave to which his weeks off work had entitled him.
The EAT identified a particularly hard balancing act. Employers who keep long term ill employees on the payroll could be liable to pay four weeks' salary per year.
The EAT pointed out that "employers may be driven to terminate employment rather than letting it continue where there is a long-term sickness absence".
HMRC v Stringer, Schultz-Hoff v Deutsche Rentenversicherung Bund, ECJ
Other seminar papers
- Discipline & Grievance Rules April 2009
- Privacy in work place
- Sickness in the Workplace March 2009
- Stress at work
- Variation of Terms by Employer
.......................................................................................................................................................
By Peter Miller, Head of Employment Law at Bowling
& Co
62 Broadway, Stratford, London E15 1NG
Tel: 020 8221 8000 Fax: 020 8519 5504
Direct Telephone: 020 8221 8065
Email: Peter.Miller@bowlinglaw.co.uk
Website: www.bowlinglaw.co.uk
This Article is written as a general guide and is not a substitute for
professional advice.
You are strongly recommended to obtain specific professional advice before
you take any action.