In this issue

The Internet: Use and Abuse
Negligence
New Rights for Part-timers
Human Rights Act 1998
Pensions and Bankruptcy
Insolvency Law Reforms

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Editorial

Welcome to the summer edition of The Orchard. We are grateful to all who commented on the first new style issue produced in the spring and to those who have suggested topics to include.

As we enter into the holiday season we wish all our clients and friends an enjoyable break from the daily grind and a relaxing time - perhaps even in the sun!

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The Internet: Use and Abuse

Any company making internet and e-mail available to employees should have a clear written policy on its use. There are many pitfalls if the policy is not clear.

There has been a rapid rise in the number of unfair dismissal claims relating to internet abuse. The most obvious example is the now common case of the employee down loading pornographic material. However, the nature of the material is not necessarily going to be regarded by the tribunal as the important issue, particularly if there are not clear guidelines. In at least one tribunal case an employee was found to have been unfairly dismissed for down loading pornographic images because the company had no policy.

There is also a risk that other employees may make claims if one employee is abusing the internet. In one case a female employee claimed against the employer for sexual harassment because male employees in an open plan office were down loading pornography. The employer was found liable because it had not taken steps to stop it.

Employers now frequently monitor employees' use of the internet and e-mail. However this may itself give rise to employee claims. The Data Protection Act 1998 provides that employers should respect employees' privacy and human dignity. An employee whose personal use of the computer is monitored without warning may complain that this is an infringement of the Act.

These rights are likely to be reinforced by the Human Rights Act which will introduce new rights to privacy this autumn. It has already been established that an employee has a legitimate expectation that private telephone calls made from business premises will not be intercepted without warning. The use of e-mail and the internet is likely to be protected in the same way. But an employee warned in a written policy is less likely to be able to complain.

There is also a risk that the employer may be liable for defamatory material placed on the internet or sent by e-mail by the employee. In one recent case Norwich Union were reported to have paid substantial damages for libel following an e-mail published by a manager which made defamatory remarks about another company.

The message from all these cases is that the employer should ensure that there is a carefully written policy on use of internet and e-mail made available to all employees.

Richard Holmes

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Strange But True

Like every other profession barristers are potentially liable for negligence. And sometimes their insurers pay out to settle claims. It is a little known fact however that there has still not been a single reported case (other than one which was successfully appealed) in which liability has been in issue in contested proceedings and judgment given against the barrister and in favour of the client.

Part of the reason lies in the old established principle that advocates should enjoy immunity for the manner in which they present cases at Court. Immunity exists on grounds of public policy. It is considered that it is in the public interest that there should be finality of litigation and it is contrary to public interest to re-hear trials that have already taken place. The immunity extends to advice given or work done which is intimately connected with the conduct of the case in Court - for example in giving advice on evidence or in advising to settle at the door of the Court.

The whole principle of immunity is however currently under consideration. The House of Lords will shortly be producing a decision in the case of Arthur J S Hall & Co -v- Simons. It is widely anticipated that the Lords will at the very least substantially redefine the whole concept of barristers immunity. Watch this space.

Adam Chivers

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New Rights for Part-timers

Regulations giving extended rights to maternity leave, parental leave and time off for dependents came into force on 15 December 1999. The Government's programme of "family friendly" policies is now extended by publication of Part-time Work Regulations which come into force on 1 July 2000.

What are the new rights?

The regulations are intended to secure for part-time workers terms and conditions no less favourable than those of comparable full-time workers. They should:

• receive the same hourly rate as comparable full-time workers
  
  
• receive the same overtime rate as comparable full-timers, once normal full-time hours havebeen worked
  
  
• have the same access to training opportunities
  
  
• have the same entitlement to maternity leave and pro rata to holiday leave.

Who is covered?

All workers, with no qualifying period and no exemption for small employers. Note that as with much recent employment protection, the cover is for workers, not only employees ie certain self-employed or agency workers who provide personal services may be included.

What is a comparable worker?

This may be a contentious issue in any dispute. The comparable worker is a person doing broadly similar work in the same place on a similar contract, taking into account qualifications, skill and experience.

The regulations are likely to apply particularly to women returning to work part-time after maternity leave. In these cases, they will probably be able to find an easy comparable either in their own previous full-time terms and conditions or in those of employees who did the same work when they were full-time.

Is there a right to work part-time?

No. There is no general right to work part-time. However, an employer faced with a request to work part-time has a duty to give reasonable consideration to the request. This arises commonly in the case of women returning to work part-time after maternity. The employer in these cases may now have difficulty in showing good objective reasons for refusing a request to work part-time, particularly where there are other part-time workers in the business. An unjustifiable refusal may amount to sex discrimination, and awards of compensation can be substantial.

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HUMAN RIGHTS

Not Just Torture

On 2nd October the Human Rights Act 1998 goes live. It introduces principles of human rights established by the European Convention on Human Rights and Fundamental Freedoms which celebrates its fiftieth anniversary this year.

All legislation will be required to be interpreted in a way compatible with HRA. This will affect the traditional application of precedent. Courts will have to exercise their discretion so as to be HRA compatible.

As one would expect there are such rights and freedoms as:

• the right to life
  
  
• the right to liberty and security
  
  
• the right to freedom of thought, conscience and religion.

However of more interest to those who become embroiled in commercial disputes there is also the right under Article 6 to a fair and public hearing.

This is likely to have a big impact on civil litigation and may have profound effects on two established forms of dispute resolution.

Article 6(1) has at its heart the premise that:

Everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law.

With this in mind the following may be food for thought. If you are a party to arbitration (a long established method of dispute resolution) or to adjudication as introduced for construction contracts in the Housing Grants Construction and Regeneration Act 1996 then (as adjudicators and arbitrators have the power to determine civil rights and obligations) the HRA obligations should apply.

If so, then does a decision in 28 days under the strict Scheme for Adjudication time limits constitute a reasonable time?

Arbitration and adjudication hearings are rarely, if ever, held in public. Does this fall foul of Article 6(1)?

Does an arbitration or adjudication based on a consideration of documents only (i.e. with no examination or cross examination) constitute a fair hearing?

Parties who voluntarily enter into an arbitration with a private hearing may see the effect of Article 6(1) curtailed. However, a party "ambushed" under the adjudication procedure and not brought into the firing line voluntarily may be able to argue that the process contravenes the Act.

After October losing parties may seek to challenge arbitrators' and adjudicators' decisions. However, Lord Woolf has issued a stern warning that impractical and far-fetched arguments will not be tolerated. Expect the courts therefore to produce some fairly stringent decisions so as to ensure that the provisions of HRA are used as intended and not to achieve a second bite at the cherry.

Philip Burbidge

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Pensions and Bankruptcy

Dennison -v- Krasner and Lesser -v- Lawrence; a short-lived legacy

The effect of the Court of Appeal's recent judgment in the cases of Dennison -v- Krasner and Lesser -v- Lawrence (see report in The Orchard spring edition) will be short-lived because of the government's decision to accelerate the introduction of certain provisions of the Welfare Reform and Pensions Act 1999.

The cases decided that:

• restrictions on assignment required by tax legislation did not prevent pension rights from vesting in a trustee in bankruptcy. That would require express statutory provision;
  
  
• pension rights forming part of a bankrupt's estate could not be the subject of an income payments order under s.310 of the Insolvency Act 1986;
  
  
• the vesting of pension rights in the trustee is not inconsistent with the UK's obligations under the European Convention on Human Rights.

The relevant provisions contained in the Welfare Reform and Pensions Act were expected to come into force in April 2001. They have now been brought forward to 29th May 2000 and apply to all bankruptcies where the petition is presented after that date.

In summary, the "accelerated" provisions mean that:

• any rights which a bankrupt has under an Inland Revenue approved occupational pension scheme, retirement annuity contract, personal pension scheme or relevant statutory scheme are excluded from his estate and therefore do not pass to his trustee in bankruptcy;
  
  
• pension payments can continue to be taken into account when calculating a bankrupt's income for the purposes of an income payments order.

The Act will also provide for the recovery by a trustee of excessive contributions which may have been paid by a bankrupt into his pension fund prior to his bankruptcy. It is unlikely however that these provisions, which will be important to safeguard creditors from attempts to protect assets by this means, will come into force until November 2000.

The certainty which the new provisions afford to those "lucky" bankrupts to whom they apply is to be welcomed.

Keith Mahoney

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Bankruptcy - Honesty May Pay

According to the government our lack of support and respect for entrepreneurs together with the perceived stigma of business failure and bankruptcy is stifling the nations hopefuls. The reform of our bankruptcy law is proposed to address this.

The proposals seek to differentiate between bankrupts who are honest but have failed due to bad luck and those who are dishonest, reckless and fraudulent.

Currently, all bankrupts lose most of their assets, are automatically disqualified from being directors of limited companies and have other hardships to endure throughout a period of up to three years. The proposal is that the honest but unlucky bankrupt will enjoy a more lenient regime and the dishonest, reckless and fraudulent one, a tougher one.

Proposed for the honest but unlucky are:

• Discharge from bankruptcy after 6 months
  
  
• Attendance at financial counselling sessions in return for early discharge
  
  
• Protection of the bankrupt's equity in the family home, at least in part
  
  
• Abolition of certain disqualifications and restrictions to help rehabilitate the bankrupt and reduce the stigma of bankruptcy
  
  
• Anti-discrimination laws.

The proposals may lead to changes in the law in the relatively near future.

Those of you interested in knowing more will find a copy of the governments consultation document, entitled "Bankruptcy - a fresh start" at
www.insolvency.gov.uk/ whatsnew/new.htm.

Edward Davies

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