Our no-smoking policy states that employees may only smoke cigarettes in the designated smoking area. We have an employee who is trying to give up smoking and is using electronic cigarettes. These cigarettes do discharge a vapour and provide nicotine simulation to users but don’t contain tobacco. Are we ok to require that the employee only smokes this electronic cigarette in the designated smoking area?
Many no-smoking policies were put in place as a result of the Health Act 2006 which provides that smoking in public places is unlawful. The aim of the legislation was to reduce people’s exposure to second-hand smoke and also to try and reduce the smoking rate. The ban applies where a substance, tobacco or otherwise, is smoked and it is generally considered that electronic cigarettes fall outside of this definition.
Prior to this Act being introduced, there had already been an employment law case that held there was an implied term in employment contracts that employees are provided with a smoke free workplace.
It is important to bear in mind that there is no general right for employees to smoke in the workplace. Consequently some employers exercise an outright ban on smoking in the workplace but it is unlikely to be unreasonable if, as well as banning smoking, an employer chooses to ban employees using electronic cigarettes.
Some employers, like you, do allow employees to smoke on site in a designated smoking area. However, requiring smokers of electronic cigarettes to use them in the same area as cigarette smokers is likely to be unreasonable. Given the essence of the Health Act 2006 and following on from the principle of employees being entitled to be provided with a smoke free workplace, to do so would seem to go against both legislation and case law. Potentially an employee could claim constructive dismissal or, if dismissed for smoking the electronic cigarette outside of the designated smoking area, may claim and succeed with an unfair dismissal claim. Therefore a separate area should be designated for smokers of electronic cigarettes. Given that electronic cigarettes are unlikely to come within the provisions of the Health Act 2006, it should be easier for an employer to designate an area for this purpose.
Of course there is nothing to stop the employee choosing to stand with the smokers in the designated smoking area.
When are employees tenants? - issues around service occupiers
A lot of uncertainty exists regarding providing accommodation for staff. Ideally, an employer would want to issue a “service licence” alongside the employment contract to ensure that no security of tenure is given to the employee.
Service occupiers include people who:
- Are employed as a live in nurse, carer, nanny, au pair or housekeeper;
- Work in a nursing home or sheltered housing;
- Are members of the clergy;
- Work in a hotel, pub or restaurant and live on the premises; and
- Caretakers, park or ground keepers, or gardeners.
The Employment Contract should state that the person has the right to live in the accommodation and that that right ends when the employment ends. It should specifically set out that it is a licence (rather than a tenancy agreement).
Often disputes centre around whether the occupancy is properly a licence or whether it is, in fact, a Tenancy. The key question to ask is whether the occupier has to live there for the better performance of their duties? If they must live there to perform their role then it is likely to be a licence. However, if they could perform their role from living at an alternative premises i.e. their own home or somewhere in private rented accommodation then the Court’s may interpret the agreement to be a tenancy.
If it is deemed that, despite being called a licence, it is in fact a tenancy, then the occupier will be deemed to be an assured shorthold tenant. To surrender this type of tenancy, 2 months notice must be served and then a possession order obtained.
Often, salary is adjusted downwards to reflect the financial benefit of the accommodation. However, this can cause a problem if a dispute arises. The financial benefit of the accommodation can be considered in a tribunal claim and could be argued as the open market value of finding replacement accommodation. If this is reflected in the salary paid then the national minimum wage will also be relevant. The National Minimum Wage Regulations sets a maximum amount an employer can count towards national minimum wage pay for accommodation (for the up to date figure please contact your HR Rely Advisor). Therefore employers should be careful that by reducing salary it does not breach the national minimum wage. Employers who break the law on basic pay will find their name published on The Department for Business website and given 3 months in which to correct the breach. The HMRC can order payment of the underpayment with a 50% penalty and, in its worse case, can criminally prosecute employers.
It is also important to note that in most circumstances it is a criminal offence to try to obtain possession of residential premises from an occupier without first obtaining a Court order or to engage in conduct which amounts to harassment of the occupier. Harassment can be very broadly defined by the Court’s and could include, for example, carrying out an inspection of the premises without making an appointment first or changing the locks. This can amount to a lawful eviction which can result in civil claims for compensation as well as the criminal sanctions mentioned above.
In conclusion, it is always prudent to take advice regarding residential accommodation provided by employers to ensure that you are acting within the law. If you need more information about the property implications of providing accommodation for employees, please contact Jane Plant in our CDR Property Litigation team. Her email address is jane.plant@weightmans.com Jane has represented landlords for over 10 years and is a member of the Law Society’s Housing Committee
I have heard that the criminal courts are now handing out higher fines to businesses when they are prosecuted for safety offences and workplace and industrial accidents and that bigger companies are going to be fined even more if they can afford to pay. Is this actually right?
You are correct. Recent case-law states that fines that courts impose for Health, Safety and Environmental offences should be higher. The 21 work related deaths in the Midlands (and accident rates) in 2013 are fewer than in previous years, but more prosecutions were brought in the Midlands than in previous years. Alongside the effects of any safety breach (often death) and how effective its management systems were, a key factor the courts will be looking at now will be a company’s turnover, rather than pre-tax profits as before. Courts can look at group structure, availability of money to pay a fine from within a group and even impose payments in instalments so that the fine truly reflects the seriousness of the offence. Network Rail and Sellafield appealed unsuccessfully against the level of their respectives fines of £500,000 and £700,000 by stating the figures were calculated taking account of their size, rather than looking more at the facts of the safety breaches before the court. Southern Water appealed an environmental fine on the same grounds and got the same outcome. A new tariff for those offences has recently been launched and fines will be based more closely on size of the company than ever before.
Any business found guilty can only be fined what it can afford and courts look to the effect of any fine on its employees and its ongoing viability. Case law has established that a fine so large as to put the company out of business should be a last resort, but the court does have the power to impose unlimited fines. Recently, a small company which was convicted of corporate manslaughter was fined an amount equal to all of its assets and so was in effect closed down by the level of fine imposed after the death of a minor in a sports related death. For those companies that can withstand and survive a high fine, the publicity and loss of reputation may be so damaging that the end result is the same.
Turning that argument on its head, those larger companies that can afford to pay higher fines will in future be fined more, on the basis that the effect of such a high figure will be less and the impact better absorbed at that level.
Chris Green is lead partner in the Weightmans Midlands regulatory team and works across both our Birmingham and Leicester offices. He delivers practical and workable commercial solutions to companies, public sector authorities and individuals who become embroiled in the criminal justice system (usually, for the first time). He guides his employer clients through the regulatory investigation process following serious and fatal accidents in work and public places.