Employment Law. Bulletin. LANDWELL Solicitors Autumn In this issue: CCTV - Caught In The Act!

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1 Employment Law Bulletin LANDWELL Solicitors Autumn 2003 In this issue: CCTV - Caught In The Act! 1 New rights for fixed term workers 2 Transfer of a business - new regulations 2 Data protection - new obligations for employers 4 Hot off the press 5 CCTV - Caught In The Act! CCTV is often used to provide security for business premises. Recent cases before the Employment Appeals Tribunal ("EAT") would also indicate that employers are increasingly using CCTV footage to discipline employees for their misconduct caught on camera. However, caution must be exercised when using such evidence to justify terminating an employment contract. A fair procedure must always be followed and a balance struck between an employer's right to protect his business interests and the employee's rights. CCTV and the Employer's Obligations Often the installation of CCTV is taken primarily as a security measure and employees are not informed that their conduct may be monitored. Best practice would be to simultaneously inform all employees on the installation of CCTV that their activities may now be monitored. Ideally, employers should have clear policies in place on the monitoring of employees and a clause should be inserted in a policy or contract of employment, whereby the employee gives his explicit consent to all types of monitoring ( , internet, business calls and CCTV) in the workplace. Any kind of covert monitoring is highly inadvisable and should only be used in exceptional circumstances, for example where criminal activity is suspected and notification of monitoring would prejudice detection. CCTV - a legitimate method of monitoring employees? Cases recently before the Employment Appeals Tribunal (EAT) illustrate the use of CCTV in the workplace and the EAT's attitude where it forms part of the disciplinary process. In Pacelli v Irish Distillers Limited ("the Company") (2001) the employee was employed as a loader, which involved loading stock onto a truck from the warehouse for delivery to customers. The Company had been experiencing stock losses and initiated an internal investigation. The Company believed that the claimant was overloading the stock that was required to be delivered to customers. CCTV cameras were already in place in the warehouse and as part of the internal investigation process, the General Manager reviewed tapes of the claimant loading stock. The claimant was disciplined and dismissed for breach of trust arising from his failure to account for missing stock under his control. The CCTV tapes were offered to the claimant as part of the disciplinary process and were shown to the EAT during the course of the hearing. The EAT found the dismissal to be fair and stated that the investigation had been thorough and fair. In another recent case, Teeling v Petrogas Group Limited (2002), the claimant worked in a service station. Her employer alleged that business profits were suffering due to theft. It was put to the claimant that there was CCTV evidence of her eating sweets and the claimant was dismissed. However, the dismissal was found to be unfair due to the lack of a fair procedure. Employment Law Bulletin page 1

2 What emerges from these cases, is that while the actual use of CCTV is not considered inappropriate, it is essential that fair procedures are adhered to when presenting CCTV images to employees in the course of disciplinary proceedings. They also suggest that the EAT have no difficulty with accepting CCTV as evidence when defending unfair dismissal claims. CCTV and Data Protection In the recently implemented Data Protection (Amendment) Act 2003 (the "2003 Act"), the definition of "personal data" may be interpreted to include CCTV footage of a particular employee. The 2003 Act sets out a number of conditions, which must be complied with in order to carry out the "processing" (i.e.: the obtaining, collecting and storage) of personal data, which would apply to the retention of CCTV tapes. The 2003 Act provides the use of data must be in proportion to the interests which the employer is seeking to protect. The employee may also have a right of access to any CCTV images of himself by means of an access request. CCTV images should only be kept for a specified and legitimate purpose and the data collected must be relevant. The images should not be kept for longer than is necessary and appropriate security measures must be taken against unauthorised access. New Rights for Fixed Term Workers The Protection of Employees (Fixed Term Work) Act 2003 ("the Act") came into force on 14 July The Act implements a European Directive in respect of fixed term workers and will impact on an estimated 70,000 workers who are employed on fixed term contracts in Ireland. The Act applies to all employees engaged on a fixed term basis. However, there are specific categories of employees excluded, including agency employees or employees in vocational training or apprenticeship schemes. The Act explicitly provides that a fixed term employee cannot be treated in a less favourable manner than a comparable permanent employee in respect of his terms and conditions of employment. Employees engaged on a fixed term basis must now be afforded access to all benefits available to comparable full time employees such as sickpay, share options schemes or access to training. However, there is a specific exception in relation to the membership of a company pension scheme. The Act provides that there is no obligation on the employer to provide an equivalent pension arrangement if the fixed term worker's hours are less than 20% of a comparable full time employee. The only time a fixed term employee may be treated in a less favourable manner, is if such treatment can be justified on objective grounds unrelated to the employee's fixed term status and is necessary for the purpose of achieving a legitimate purpose of the employer. To protect employees from the perceived abuse of successive fixed term contracts, the Act also provides if a fixed term employee completes three years continuous employment, then the fixed term contract may only be renewed one more time by the employer for a period of no longer than one year. After this period, the next renewal will be deemed to be a permanent contract, unless there are objective grounds justifying the renewal. Fixed term employees must now be informed of all vacancies to ensure they have an opportunity to apply for a full time or permanent position available to all employees. The penalties for non-compliance are significant. An employee who makes a successful claim to a Rights Commissioner may be awarded up to a maximum of 2 years gross remuneration. Employers should review existing employment practices and procedures, which they have in place for permanent and fixed term employees to ensure compliance with the new legislation. Transfer of a Business - New Regulations The Acquired Rights Directive, ("the Directive") was initially implemented in Ireland in 1980 by the EC (Safeguarding of Employees Rights on Transfer of Undertakings) Regulations, ("The Regulations"). The Regulations and Directive protect the employment rights of employees in the event that the business in which they work is sold or transferred to a new employer. In brief, an employee is entitled to transfer with the business to the new employer on the same page 2 Employment Law Bulletin

3 terms and conditions of employment (with the exception of pensions) with his continuity of service preserved. It is also unlawful to dismiss an employee for a reason connected with the transfer of a business, unless there are economic, technical or organisational reasons entailing a change in the workforce. Earlier this year the Regulations were repealed and replaced by the EC (Protection of Employees on Transfer of Undertakings) Regulations 2003 ("the 2003 Regulations"). The 2003 Regulations are more extensive than the previous Regulations and include a number of new key definitions. The main provisions of the new legislation are as follows:- Bankruptcy and Insolvency It is explicitly provided that the 2003 Regulations do not apply to the transfer of an undertaking or business where the original employer is the subject of bankruptcy or insolvency proceedings. This exception should give companies in financial difficulty greater flexibility to sell their business. However, if the main reason for the institution of such proceedings is the intended evasion of obligations under the 2003 Regulations, then the 2003 Regulations will apply to the transfer of the business to the new employer. Information and Consultation Prior to the transfer of a business, the original and new employer are required to inform and consult with employees' representatives about the reasons and implications of the transfer. Previous practice under the Regulations was to inform and consult employees "in good time" prior to the transfer. However, a specific timeframe of 30 days has now been inserted by the 2003 Regulations. The employer must give the appropriate information to the employees' representatives, when reasonably practical, but not less than 30 days before the transfer is carried out. In the event an employer does not comply with the consultation obligations under the 2003 Regulations, then an employee can make a complaint to a Rights Commissioner, who may award compensation up to four weeks remuneration. Extended Penalties Previously under the Regulations if an employee's terms and conditions were substantially changed for a reason connected with the transfer of the business, the employee's means of challenging this decision were limited. An employee might argue that the change to his terms and conditions constituted a repudiation of his contract of employment. He could take the rather drastic action of resigning and claiming that he had been constructively dismissed. In practice this option was rarely used and was only available to Employment Law Bulletin page 3

4 employees with one years continuous service. Those with less than one years service had no significant means of challenging a decision to change their terms and conditions or to terminate their employment. By comparison under the 2003 Regulations, an employee in the same circumstances could now remain in employment and enforce his right not to have his terms and conditions changed by taking a complaint to a Rights Commissioner. The complaint can be made by an employee, trade union or staff association. A Rights Commissioner has the power to make an award of compensation as is just and equitable up to two years salary and may make an order requiring the employer to take a specified course of action if required. Therefore, an employer can now be penalised as well as being forced to rectify whatever the breach complained of is under the 2003 Regulations for all employees irrespective of their length of service. Data Protection - New Obligations for Employers The Data Protection (Amendment) Act 2003 (the "Act") came into force on 1 July The Act amends the Data Protection Act 1988 and implements further important provisions of an existing European Directive on data protection ("the Directive"). The Act significantly increases the responsibilities of employers in regard to the processing of employee personal data. For the first time, employers who hold personal data on their employees will be required to register as data controllers with the Data Protection Commissioner. Previously, only companies involved in certain prescribed activities such as marketing were required to register. Whilst this registration requirement has not yet been brought into force, it is envisaged that these provisions will be implemented in late 2003/ early It is anticipated that only sole traders and employers with few employees will be exempt from the requirement to register, however they will still be obliged to comply with the requirements of the Act. As data controllers, employers should be aware of their data protection responsibilities to enable them to process personal data "fairly" within the meaning of the Act. The Act places a duty on employers to ensure that their staff are aware of their respective data protection responsibilities. Raising staff awareness would be best achieved through training and/or the availability of an internal data protection policy. Employee right of access One of the most important aspects of the Act is that from 1 July 2003 the definition of data now includes manual data, provided such data is part of an identifiable filing system. Previously the definition of data was confined to automated data or data held on a computer. The right of access only applies to manual data created on or after 1 July 2003 and it will not apply to manual data created prior to this date until October Employees may now have a right of access to manual records such as references, interview notes, disciplinary and appraisal records. This could extend to an oral reference, if the conversation was written down and filed with other personal data relating to the employee. However, the Act provides that if a reference is explicitly given in confidence, an employer could refuse to disclose the reference. Employers should keep this in mind when providing references. Employees also have a right to have any information held on them, that is inaccurate or incorrect, to be rectified, blocked or erased. An employer may charge a reasonable fee for providing access to this data, which does not exceed Processing Personal and Sensitive Data The Act distinguishes between Personal Data and Sensitive Personal Data ("SPD"). SPD is defined as data relating to a person's racial origin, political opinions or religious or other beliefs, physical or mental health, sexual life, criminal convictions or the alleged commission of an offence and trade union membership. Employers are required to process personal information about an employee for the purpose of the contract of employment. Therefore, the consent of the employee to process Personal Data is not required. However, if an employer is processing SPD, then an employee's explicit consent is required. Employment Law Bulletin page 4

5 Compliance and Penalties Employers are encouraged to undertake an internal audit, as the penalties for non-compliance are significant. Employers should review their application forms, contracts of employment, policies and procedures. Questions should be asked as to how personal data is stored, do these procedures need to be reviewed in light of the Act? The Data Protection Commissioner is responsible for enforcing the provisions of the Act and has a wide range of powers to assist him. If a data controller is found to be in breach of the Act, he may be liable for fines up to 100, 000 on indictment and may be ordered to delete all or part of a database. An employer may have medical information on an employee resulting from a pre employment medical or SPD may be voluntarily provided on a CV. In these circumstances employers should obtain the consent of the employee to process this information. Data Protection Policy ("a Policy") Ideally, employers should have a Policy in place, which regulates how the company processes employees personal information. It should also be a source of guidance for employees as to how they should deal with and process Personal Data and SPD that comes into their control in the course of their employment. In brief, the Policy should incorporate the eight fundamental data protection rules contained in the Act and Directive as set out below:- 1. Obtain and process information fairly. 2. Keep it only for one or more specified explicit and lawful purpose. 3. Use and disclose it only in ways compatible with the purposes. 4. Keep it safe and secure. 5. Keep it accurate, complete and up to date. 6. Ensure that it is adequate, relevant and not excessive. 7. Retain it for no longer than is necessary for the purpose or purposes. Landwell Employment & HR Unit and our Technology, Media and Communications Unit are available to advise further on the conduct of a compliance test, the implementation of an internal data protection policy and a suitable training programme for HR specialists or staff if required. Hot off the press... Smoking Ban in the Workplace Controversial draft regulations have been issued by the Minister for Health and Children, Micheal Martin TD, (the "Minister") on the prohibition of smoking in a variety of locations including licensed premises, registered clubs and places of work. The Tobacco Smoking (Prohibition) Regulations 2003 (the "2003 Regulations") are set to be implemented on 1 January The Minister has stressed that the wording of the 2003 Regulations has not been finalised. He stated that the legislation is about the right to work in a smoke-free environment and the health and well being of an employee cannot be compromised because of the sector in which he or she works. Smoking is already prohibited or restricted in a range of workplace situations under the Tobacco (Health Promotion and Protection) Regulations A breach of these 1995 Regulations can result in a maximum fine of 635 for the owner manager or person in charge of the premises and/or 6 months imprisonment. 8. Give a copy of his/her personal data to that individual on request. page 5 Employment Law Bulletin

6 The 2003 Regulations contain a strict ban on smoking in all places of work with no exception, which will perhaps more controversially cover pubs and restaurants, that are deemed a place of work. This will prohibit smoking room facilities in the workplace or permitting smoking offices. Industry representatives are divided in their support of the ban. The Irish Hospitality Alliance ("IHA") is a newly formed lobby group representing pubs, guesthouses and hotels, which is against the ban on smoking. The IHA cites the negative impact the ban will have on the economy as one of its main objections. IBEC supports the IHA and has called for the situation to be examined more carefully before any legislation is brought into force. The trade union MANDATE which represents bar workers supports the ban and rejects what it calls scare mongering tactics by the IHA. Government sources have indicated its members are divided in their views on the 2003 Regulations and that cabinet approval is not guaranteed. Technically, the Minister does not have to seek cabinet approval in implementing the 2003 Regulations as s.47 of the Public Health (Tobacco) Act 2002 allows for the Minister to draft Regulations introducing the ban. PRSA deadline now passed The Pensions Amendment Act 2002 introduced a number of additional obligations on employers. Since 15 September 2003 employers are now obliged to provide employees (including part-time employees) with access to a standard Personal Retirement Savings Account (PRSA) where the employer does not have an occupational savings scheme in place or where: - staff are not eligible to join an existing occupational saving scheme; or employees must wait more than 6 months to join the scheme; or there is no facility to make AVCs to the occupational plan. Work Permits Changes From May 2004 nationals of the EU Accession States will not need a work permit to access the Irish labour market. Employers should be aware that it is no longer possible to apply for work permits for non-eea nationals in certain prescribed occupational sectors. Examples of ineligible sectors include clerical and administration work, general labour, and sales staff. Should you wish to discuss any of the above developments, you may contact members of the Employment Law Unit at the addresses and telephone numbers listed below:- Jim Trueick (Partner) jim.trueick@ie.landwellglobal.com Phone: Colleen Cleary (Senior Associate) colleen.cleary@ie.landwellglobal.com Phone: Michelle McLoughlin (Associate) michelle.mcloughlin@ie.landwellglobal.com Phone: Margaret Pilkington (Solicitor) margaret.pilkington@ie.landwellglobal.com Phone: Wendy Doyle (Solicitor) wendy.doyle@ie.landwellglobal.com Phone: Disclaimer: This material is in the nature of general comment only. It is not offered as advice on any particular matter and should not be taken as such. page 6 Employment Law Bulletin