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PAGE EUROPEAN REVIEW
As reported on page 2 of this issue the European Union has at last put in hand measures to help workers on fixed term contracts. The European Review looks at the position in the United Kingdom and assesses how new legislation might help.
The U.K. shares with Ireland and Denmark the dubious distinction of having no controls on the use of fixed term contracts by employers. Whilst, at 7.4% of the workforce, the use of these agreements is not as widespread as in some other EU countries such as Portugal and Spain, the lack of legislation means that fixed term workers are in a highly vulnerable position. For instance if their contract is longer than one year the employee can sign waivers giving away rights to protection against unfair dismissal and, if for two years or more, redundancy payments. These are invalid with any other type of employment contract but many employers recruit staff on fixed term contracts, requiring them to sign waiver clauses.
There have been attempts to challenge waiver clauses in the courts. In the case of BBC v Kelly-Phillips the employer had employed Ms. Kelly-Phillips on a series of fixed term contracts, after the fourth contract of three months duration her contract was not renewed. The BBC indicated that it was no longer satisfied with her work but no disciplinary action was taken against her. She took a claim for unfair dismissal to an Industrial Tribunal. The BBC argued that as she had signed waiver clauses and as her total period of employment was longer than a year Kelly-Phillips had no claim. Although both the Industrial Tribunal and the Employment Appeal Tribunal found in her favour on the basis that she could not waive her rights on a three month contract, the Court of Appeal took the view that her total period of employment with the BBC was what counted. This decision, which is still being appealed to the House of Lords, gave the green light to unscrupulous employers to renew fixed term contracts until the total period of employment was sufficient for waivers to be valid. As well as the European moves, the British government has included amendments in the new Employment Relations Act which will improve the position somewhat. Waivers of unfair dismissal claims will be unlawful, however long the contract although if the period is longer than two years, waiving redundancy payments will still be valid. Where employers have genuine reasons for using a fixed term contract they will have to show that they have 'some other substantial reason' for not renewing it or that it is a genuine redundancy to be treated as such.
Into this morass the European Union enters with its own attempt to sort things out. As reported on page 2 of this journal the new agreement on fixed term working will become a directive if given the backing of the Council of Ministers and the U.K. will then have a maximum of 3 years to implement it. How will it affect the position of fixed term contract workers as outlined above ? The principle of equal treatment which the agreement establishes means that they cannot be treated less favourably than 'comparable permanent workers'. They therefore should have the same length of service to qualify for sick leave, holidays, pensions and maternity rights unless there is some other objective justification. Other rights enshrined in the agreement include access to training, notification of permanent vacancies and notification of unions that fixed term contracts are being initiated by the employer. On abuse of contracts the agreement aims to prevent continual extension as an alternative to proper workforce planning and recognises that 'employment contracts of indefinite duration are the general form of employment relationships and contribute to the quality of life of the workers concerned and improve performance'. Already some U.K. trade unions have negotiated deals that ensure that a worker becomes permanent after an agreed number of contracts.
The effect of the EU measure could therefore be very helpful but as it deals only with principles it is likely that protracted discussion will take place in the unregulated labour markets such as the U.K. before it is put into practice.
The Broadcasting, Cinema and Theatre Trade Union, BECTU, has had a
case on working time referred to the ECJ. This is the first case from
the U.K. concerning the EU working time regulations that has reached
the European court. BECTU is challenging the requirement that a
worker must be continuously employed for 13 weeks in order to acquire
a right to annual leave. The union represents thousands of workers
who are employed on short term contracts in the film, theatre, cinema
and related sectors. They rarely work for the requisite time for the
same employer and consequently never accrue paid annual leave.
Article 7 of the Working Time directive grants a right to paid annual
leave to every worker. However it also states that the right is 'in
accordance with the conditions for, entitlement to, and granting of,
such leave laid down by national legislation or practice'. The
British government has used this clause to impose the 13 week
qualifying period citing expense to employers as the reason, although
it has produced no figures to support this.
As well as laying down how the right to annual leave should work, the
referral should decide a more general point. The Working Time
directive is a health and safety measure and it states that
governments cannot subordinate 'workers' safety.... to purely
economic considerations'. The European Court of Justice will also
have to judge how this principle is to be applied to all the specific
provisions of the directive.
Staff representatives from Austrian social insurance institutions have lost a case based on the Equal Pay directive. Psychotherapists in these institutions are either qualified doctors (mainly male) or hold a psychology degree (mainly female). The ECJ decided that although the two groups seemed to be doing the same work, the doctors had received a wider range of training and should therefore be in a higher pay category.
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