Detriment and the ‘opt out’ under the WT Regs

Mon, 26 Mar 2012

By Russell Bailey
In Arriva London South Ltd v Nicolaou UKEAT/0293/11/RN the EAT (His Honour Judge Peter Clark) resolved an interesting conflict between the right not to opt out of the 48 hour maximum working week and the right not to be subjected to a detriment for declining to opt out. Russell Bailey, who was counsel for the successful party, Arriva, shares some thoughts on the implications of the decision.
 
In Arriva London South Ltd v Nicolaou UKEAT/0293/11RN, Arriva implemented a policy such that drivers who had not opted out of the 48 hour working week would not be afforded overtime. Mr Nicolaou, in common with other bus drivers, worked a contractual 5 day week with the opportunity (which was purely voluntary at the election of the employee) to work overtime; primarily to work one of the two rest days. The basic working week varied from driver to driver but averaged 38 hours per week with a maximum of 42.5 hours per week. Therefore a driver who regularly worked a rest day could work more than an average 48 hour week. Mr Nicolaou habitually worked a rota where the basic hours were less than 38 hours per week and so, in his case, and assuming no change in his working pattern, he would not exceed a 48 hour week even if he regularly worked a rest day.
 
Mr Nicolaou refused to sign an opt-out and Arriva refused to afford him overtime. M Nicolaou complained to the employment tribunal that he was being subjected to a detriment by being declined overtime on the ground that he refused to sign an opt-out. Arriva contended that they were not subjecting him to a detriment but implementing a reasonable policy, as required by the Working Time Regulations 1998 [WTR], to ensure that non-opted out workers did not work more than an average of 48 hours per week.
 
The employment judge had determined, on a remission to her, that Arriva’s policy was reasonable and a late appeal against that decision was refused. At the second appeal His Honour Judge Peter Clark held that the judge had been in error in failing to apply the jurisprudence on the law of detriment / victimisation.
 
The tension between S.45A ERA and Reg 4 WTR
 
S.45A protects a worker from being subjected to a detriment on the ground that he has declined to sign an opt out agreement whereas Reg 4 required that a non-opted out worker be treated differently from an opted out worker and that gives rise to a potential tension between those statutory provisions. In particular where a worker has not opted out the employer is required:
 
•    Not to permit the worker to work more than an average 48 hour week [Reg 4(1)]
•    To take reasonable steps to ensure compliance with Reg 4(1) [Reg 4(2)]
•    To keep records of the hours worked of those who have not opted out – in the case of those who have opted out the requirement is merely to keep the opt out form [Reg 4(3)]
 
All three of those requirements, which can be visited with criminal sanction if the employer fails to comply, can impose negatively upon the employee. Not only is the employer required to decline overtime in certain circumstances, the employer might need the worker to participate in the record keeping requirement. In this case, Arriva ensured compliance with Reg 4(1) by declining to afford overtime at all to those who had not opted out. It was only contended that was a reasonable policy because an opted out employee remained in complete control of whether or not he worked overtime because overtime remained purely voluntary at his election.
 
The detriment / victimisation jurisprudence
 
Perhaps the most interesting feature of this decision is the fact that the trigger criterion of Arriva’s policy (not to afford overtime) was the protected act itself (refusing to opt out). It was therefore common ground, during the appeal, that the reason for the refusal of overtime was the refusal to sign an opt out. In that sense, the decision goes further than the well known appellate authorities where they have distinguished “the reason why” from the protected act. 
 
For example in Chief Constable of West Yorkshire v Khan [2001] ICR 1065 the House of Lords considered that the reason why the force had not provided a reference for Khan was because they were involved in litigation with him and not because he had committed a protected act by advancing a complaint of race discrimination.
In Arriva v Nicolaou it was necessary for His Honour Judge Peter Clarke to look behind the protected act and to consider whether the refusal of overtime was a retaliation for Mr Nicolaou engaging in a protected act (by not signing the opt out) or whether it was the implementation of a policy made pursuant to Reg4(2). He determined it was the latter. 
 
Application elsewhere
 
It should be noted that the mechanism of an opt out is not required by the Working Time Directive which merely requires that a worker should not work more than an average of a 48 hour week without his agreement (Article 22). The formality of an opt-out is a creature of domestic legislation. Agreement would have been achieved merely by a worker requesting overtime and the employer affording it. 
 
However, a similar mechanism arises in relation to Sunday working except it involves an opt-in rather than an opt out. It is suggested that, by parity of reasoning, a worker who refused to sign an opt-in but then complained that she was not allowed to work on Sunday would not succeed in a claim for unlawful detriment under S 45 ERA. 
 
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