Deliveroo IPO raises questions around worker rights and dual class share structures

Summary

Several fund managers have elected not to participate in Deliveroo Holdings plc’s (Deliveroo) impending initial public offering (IPO), with concerns over the company’s treatment of workers and the dual class share structure. The roster includes Legal and General Investment Management, which is the UK’s largest fund manager with £1.3tn of assets under management.  Similarly, M&G, Aberdeen Standard Investments and Aviva Investors have told the Financial Times that they too will “shun” the listing (“Legal and General joins investors shunning Deliveroo IPO”, Financial Times, 25 March 2020).

Background

Deliveroo is a popular online food delivery company founded in London.  Customers use an app or website to order food from grocers, local restaurants or ‘ghost kitchens’ and the food is delivered by self-employed bicycle or motorcycle couriers.  Revenue is generated by charging fees to both restaurants and customers.

Continue reading “Deliveroo IPO raises questions around worker rights and dual class share structures”

No Jab, No Job: The Murky World of Mandatory Vaccinations

By Nic Hart

The ongoing pandemic has inevitably caused employers to address a significant number of issues regarding employees and working practices. Mandatory vaccination has become an acute and difficult topic in the context of the employment relationship.

As the vaccination program continues to be rolled out across the country, one of the recent issues causing controversy and consternation for employers is the question of mandatory vaccinations for employees.  Some businesses such as Pimlico Plumbers and Qantas have been reported as coming out in support of mandatory vaccination policies. Pimlico Plumbers in particular have proposed implementation of a “NO JAB NO JOB” policy and Qantas have advised that they plan to require all international passengers to be vaccinated against Covid-19 as a condition of travel. Continue reading “No Jab, No Job: The Murky World of Mandatory Vaccinations”

COVID-19: UK Gov Flexible Furlough Scheme – 1 July 2020 Update

By Nic Hart &  Liam Hutton

01.07.2020

The Flexible Furlough Scheme (FFS) commenced today July 1st 2020 and you can now submit claims for periods starting on or after 1 July.

GOV.UK published a news story this afternoon announcing this commencement.

As discussed in earlier mail outs the main premise of the FFS is to allow;

“businesses to bring furloughed employees back to work on a part time basis and will be given the flexibility to decide the hours and shift patterns of their employees – with the government continuing to pay 80% of salaries for the hours they do not work.”

The FFS will remain open until the end of October 2020. Continue reading “COVID-19: UK Gov Flexible Furlough Scheme – 1 July 2020 Update”

ECJ Advocate-General Opinion: Disability Discrimination Can Be Found By Comparison With The Treatment Of Other Disabled Employees

By Nic Hart & Liam Hutton

26.06.2020

The Advocate-General of the European Court of Justice has given the opinion in VL (Case C-16/19) that disability discrimination can be found by comparison between the treatment of one group of disabled employees and other disabled employees. Whilst Advocate General Opinions are not binding on the Court, they are commonly regarded as influential, and this Opinion has the potential to create a new basis for comparison in discrimination cases.

The case relates to an employer who paid a monthly allowance to those of its disabled employees who obtained and submitted a disability certificate as evidence of their disability. The issue of discrimination arose because only those who had not already obtained and submitted their certificate were eligible for the allowance.

The employer’s purpose for doing this was that by bringing about an increase in the number of disabled workers employed, the employer would be entitled to a reduction in its contribution to a disability fund.

In the Opinion, the Advocate General addresses whether this could be regarded as discriminatory for the purposes of the Employment Equality Framework Directive, and sheds some light on the applicability of the prohibition of discrimination to the conduct of an employer who treats two groups of disabled individuals differently on the basis of an apparently neutral criterion (in this instance, the date of submission of a disability certificate). Continue reading “ECJ Advocate-General Opinion: Disability Discrimination Can Be Found By Comparison With The Treatment Of Other Disabled Employees”

New Guidance on the UK Gov Flexible Furlough Scheme – 12th June 2020

By Nic Hart

15.06.2020

As advised, the Government Guidance for the new Flexible Furlough Scheme (FFS) was released on Friday evening – June 12th.

Accessibility to the new Guidance is not the most straightforward as the information is spread across the existing CJRS Guidance and three new pieces of Guidance. The Government has also produced a  summary overview of the key changes to the CJRS and the timetable for the same.

The major changes to the existing scheme with effect from July 1st are:

  • there will no longer be a minimum three-week period for furlough. Whilst there will not be a required minimum period to furlough employees, any claim made to the CJRS portal must be in respect of a minimum one week period regardless of how many days may have been worked in this one week period.
  • Employers can no longer put in claims to the portal that cover more than one payroll period. All claims through the portal must start and end within the same calendar month.
  • An employer cannot furlough any greater number of employees than have been furloughed previously – subject to the provisions of those returning from parental leave.

The key principles of FFS are clear. Continue reading “New Guidance on the UK Gov Flexible Furlough Scheme – 12th June 2020”

IMPORTANT COVID-19 UPDATE: UK Gov Furlough Scheme Cut Off -10th June

By Nic Hart

05.06.2020

Further to our earlier blog posts on this topic, please be reminded that the Coronavirus Job Retention Scheme (CJRS) is closing to new entrants from 30 June 2020. You must furlough new entrants on or before 10th June. 

From 1 July 2020, there will be a new flexible furlough scheme where furloughed employees will be able to return to work on a part-time basis. Full guidance has yet to be issued (proposed for 12 June 2020) but present Guidance has advised that only employees who started furlough on or before 10 June 2020 will be eligible for the new scheme.

The Government Guidance states;

“From this point onwards, employers will only be able to furlough employees that they have furloughed for a full 3-week period prior to 30 June”

Continue reading “IMPORTANT COVID-19 UPDATE: UK Gov Furlough Scheme Cut Off -10th June”

COVID-19: UK Chancellor Announces Changes To Furlough Scheme – 29th May 2020

By Nic Hart

01.06.2020

In the daily press conference on Friday May 29th 2020, the Chancellor Rishi Sunak, announced further changes to the Coronavirus Job Retention Scheme.

In essence these are as follows:

  • The CJRS will continue until October 2020.
  • Flexi furlough will commence from July 1st 2020.
  • Grants through the CJRS will be tapered from August 2020.
  • The scheme will close to new entrants on 30 June.

Flexi Furlough

This is commencing on July 1st 2020 -a month earlier than previously announced. Employers can decide the hours and shift patterns their employees will work on their return to work, so that they can decide on the best approach for them. Employers will be responsible for paying the employees’ wages while in work.

Further guidance on flexible furloughing and how employers should calculate claims will be published on 12th June 2020, but HMRC has provided some initial advice:

Any working hours arrangement that you agree with your employee must cover at least one week and be confirmed to the employee in writing. When claiming the CJRS grant for furloughed hours, you will need to report and claim for a minimum period of a week. You can choose to make claims for longer periods such as on monthly or two weekly cycles if you prefer. You will be required to submit data on the usual hours an employee would be expected to work in a claim period and actual hours worked.

Continue reading “COVID-19: UK Chancellor Announces Changes To Furlough Scheme – 29th May 2020”

High Court Judgement On Restrictive Covenants & Garden Leave

By Nic Hart

22.05.2020

The Queen’s Bench Division of the High Court have held in Square Global Limited v Leonard that the absence of a garden leave set-off clause will not be fatal to a non-compete post termination restriction, touching on a the widely debated relationship between garden leave and non-compete clauses in employment contracts.

The case involved an employer’s attempts to enforce periods of garden leave and subsequent non-compete restrictions on an employee consecutively. The employee in question had resigned and in response claimed constructive dismissal on the basis that his employer had destroyed or seriously damaged the necessary relationship of trust and confidence between the parties, in breach of the implied term in the contract of employment. The High Court held on the facts that the employee was not entitled to resign summarily and by doing so, he had failed to give six months’ notice of termination and was in breach of his employment contract.

The employer sought to enforce a period of garden leave reflecting the six months contractual notice from the date of resignation, in addition to a further six months’ protection from the end date of that notice period on 11 May 2020 under the non-compete clause in the employee’s contract. This would effectively afford the employer a total of 12 months protection. The High Court were satisfied that the six month non-compete clause was pursuant to the employer’s legitimate business interests capable of requiring protection by restrictive covenants, and was reasonable, going no further than necessary to protect the employer’s legitimate business interests.

The High Court then went on to assert as follows:

“The garden leave clause which is included in the contract exists to cater, among other matters, for a situation where [the employer] has concerns about an employee’s conduct (e.g. harvesting client information, or engaging in deceptive behavior), and so chooses to restrict the employee’s duties during the notice period. On the assumption that such concerns have reasonable foundation, it would not then be unreasonable to enforce the full period of the post termination restrictions.” (Paragraph 191)

Continue reading “High Court Judgement On Restrictive Covenants & Garden Leave”