Entitlement to contractual sick pay above SSP, and when an employer may withhold or suspend it. Merseyrail Electrics 2002 Ltd v Taylor; Beveridge v KLM UK Ltd.
Contractual sick pay; implied terms. There is no general implied right to contractual sick pay where the contract is silent on the issue. Such a term can only be implied if the particular facts and circumstances warrant it. Contrasted with Howman v Blyth.
Contractual sick pay; implied terms; duration. Where there is a contractual obligation to pay sick pay but no agreed term as to its duration, a term should be implied which is reasonable having regard to the normal practice in the industry.
Sick pay; loan scheme; net vs gross recovery. Where an employer paid sick pay under a loan scheme recoverable from later compensation, the Court of Appeal held employees only had to refund the net sum actually received, not the gross amount. The employer could recover tax and NI contributions from HMRC separately.
PHI; implied term that an employer will not dismiss an employee to frustrate their entitlement to disability benefits.
Contractual sick pay; return to work; employer's obligation. An employee who had exhausted sick pay was declared fit by her GP and sought to return, but the employer refused until its own doctor examined her (six weeks later). The EAT held the employer was obliged to pay wages during this period: there was no express right in the contract to withhold payment while seeking its own medical opinion, and no sufficient legal basis for implying one.
Contracts; discretion; the Braganza duty. Where an employment contract confers a discretion on the employer to make a factual determination (here, whether a death at sea was suicide, which would exclude a contractual benefit), the employer must not exercise that discretion in a way that is arbitrary, capricious, or irrational. The court imports both limbs of the Wednesbury test into contract: (1) process rationality, the decision-maker must take relevant factors into account and ignore irrelevant ones; and (2) outcome rationality, the decision must not be one that no reasonable decision-maker could have reached. The duty applies to any contractual discretion that materially affects the other party's rights, including employer decisions under discretionary benefit and sick pay schemes.
Contracts; discretion; 'act reasonably'; scope of review. The Court of Appeal (Nugee LJ, Lewis and Jeremy Baker LJJ agreeing) allowed the landlord's appeal and restored the FTT's decision. Where a lease requires the landlord to act reasonably or to exercise a reasonable discretion, 'reasonably' means reasonably and not merely rationally, so Aviva v Williams is not authority that every such discretion attracts only a Braganza rationality review [70]-[72]. But the tribunal's task remains whether the landlord was in breach of contract: it is in breach only if its decision is one that no reasonable landlord could have reached; the tribunal does not ask what it would have decided itself [73], [77], [79]. Nugee LJ declined to lay down a single answer for all contractual discretions: it depends on the precise wording of the provision [76]. The reasoning bears on employment discretions under the same principles, though the court stated no universal rule.
Contractual sick pay; withholding; medical certificates. A contractual term permitted the employer to withhold sick pay if there was doubt the absence was for health reasons. The EAT held that a GP's medical certificate certifying the employee was suffering from an acute stress reaction removed any doubt. It was not open to an employer to disregard a medical certificate in the absence of contradictory medical evidence. Leading authority on the primacy of GP evidence in sick pay disputes.
Contractual sick pay; withholding; GP fit notes; suspicious timing; unlawful deduction. B was a bus driver for LGTS Ltd whose employment required a valid passenger carrying vehicle (PCV) licence, due for renewal on 23 April 2012. Renewal required a medical examination, but because B was suffering from anxiety the company doctor advised him to defer re-application pending a report from his GP. At a meeting with his manager B said that if the licence was not renewed by 23 April he would go on sick leave.
Contractual sick pay; withholding; pattern of absence. The employer withheld sick pay owing to the perceived pattern of the employee's leave applications and sickness absences. The tribunal upheld the employee's claim: a reasonable employer would not normally form an opinion that a medical certificate is not genuine unless there has been a medical investigation throwing doubt on the certificate. It found it difficult to envisage circumstances in which the opinion of an employee's GP could be overridden by the opinion of a manager with no medical qualifications.
Contractual sick pay; withholding; GP medical certificates; unlawful deduction from wages. The claimant was signed off sick from 29 January to 18 March 2009 with a GP certificate for depression. The employer did not believe he was genuinely ill, considering that he had misrepresented his state of health to his GP in order to postpone a disciplinary hearing; he had previously threatened to go off sick if he did not get his own way and had done so before. It withheld sick pay.
Discretionary sick pay; employer's discretion constrained. The contract provided that company sick pay would only be paid at the employer's discretion. The tribunal held the contract clearly envisaged the company would exercise discretion having regard to the employee's sickness record and conduct. It was not entitled to rely on extraneous considerations such as budgetary constraints to withhold sick pay from an employee whose record was impeccable.
Contractual sick pay; calculation of amount. The sick pay scheme envisaged that sick pay should be assessed according to what the employee would have expected to receive if fit and working. The EAT allowed the employee's appeal, holding sick pay should be calculated on the basis of hours actually worked (average 34 per week), not the minimum 15 hours stated in the contract.
Contractual sick pay; procedural compliance. The employee was entitled to contractual sick pay because the employer had breached the company rules governing its suspension. An employer who seeks to rely on a provision allowing it to suspend sick pay must take care to follow the correct contractual procedure.
Contractual sick pay; conditions of scheme; unauthorised deductions. The employer curtailed sick pay alleging breach of a term requiring the employee to remain at her home address. The tribunal upheld the claim: the employee had complied with the conditions attaching to her contractual right. Staying at her partner's home to be cared for was not a change of address; the employer was aware and had impliedly consented.
Contractual sick pay; misconduct and neglect; forfeiture clause. A keen gymnast, celebrating a goal in a pub, slipped while climbing onto a table to perform his customary back flip and fractured his ankle. His contract allowed sick pay to be forfeited where the injury was due to his own misconduct or neglect, and the employer withheld it. The tribunal held that the manoeuvre was risky and one an employer could properly treat as performed at the employee's own risk, so it was not irrational to conclude that he was injured by his own neglect; that would not extend to injuries from activities such as skiing or football done in a reasonable way. The claim nonetheless succeeded because the employer had failed to follow the contractual procedure for withholding sick pay.
Contractual sick pay; misconduct and neglect; definitions. The employee injured his knee attempting to lift the rear of his car. The tribunal upheld the employee's claim: 'misconduct' needed to be something of a criminal or quasi-criminal nature, and 'neglect' did not equate to simple negligence. Merely doing something others might consider unwise or silly was not enough.
Contractual sick pay; enhanced sick pay for industrial accidents; negligence. The employer withheld enhanced sick pay alleging the employee was to blame for a van accident. The tribunal held there was no evidence the accident was caused by the employee's serious negligence or misconduct and found entitlement to enhanced sick pay.
Contractual sick pay; enhanced pay for injury sustained in course of duty. The employee sought continued full pay for work-related stress. The tribunal dismissed the claim: stress and anxiety are not regarded as 'injuries' in personal injury cases, and the employee had not produced evidence of a recognised mental disorder. Contrast with Simpson v William Bradford Community College.
Contractual sick pay; enhanced pay for injury in course of employment; psychiatric injury. The contract provided full pay for absences owing to accident, injury or assault arising out of employment. The tribunal upheld the claim: there was nothing to suggest psychiatric injury was not covered, and ample medical evidence confirmed the injury arose out of and in the course of employment. Contrasts with Nickson v Greater Manchester Probation Board.