I wonder what the most significant employment law cases of 2024 are?

As 2024 draws to a close, this week’s Wednesday Wonder reviews some of the most significant employment law cases of the past year.

Fire and Rehire Practices

In the case of Tesco Stores Ltd v USDAW 2024, the issue was whether Tesco’s fire and rehire strategy was lawful. In 2007, Tesco expanded and restructured its distribution network, which meant some of their existing sites would close. To help smooth over the changes, Tesco offered a pay enhancement to its employees who would relocate under a collective agreement with the Union of Shop, Distributive and Allied Workers (USDAW) to a new distribution centre.

The employees’ contracts stated that this pay enhancement was to be permanent and could only be changed under very narrow circumstances. However, Tesco later wished to remove this retained pay enhancement and instead offered a lump sum equivalent to 18 months of the retained pay to the relevant employees. The employees that did not agree to this change were then fired and rehired on new contracts which did not include the retained pay enhancement.

The USDAW issued proceedings in the High Court, who enforced an injunction on Tesco to prevent them from issuing notices of termination. Tesco appealed this decision, and the Court of Appeal overturned the ruling. However, USDAW appealed to the Supreme Court which reinstated the High Court’s decision and reinstated the previous injunction, subsequently prohibiting Tesco from issuing notices of termination.

This case highlights the importance of taking a careful approach to drafting contracts and knowing what contractual terms actually imply. Within the employee’s contracts of employment, Tesco had stated that the retained pay was a ‘permanent’ benefit, meaning they were unable to go back on their word.

Additionally, this case brings attention to ‘fire and rehire’ practices, which are already under scrutiny for their controversial implications. Additionally, in the Employment Rights Bill 2024, the Labour Government proposes to remove such practices unless financial inability of the organisation requires such approach.  

Employment Tax Status

In the case of HMRC v Professional Game Match Officials Ltd 2024, the Supreme Court considered the employment status of football referees for tax purposes.

Professional Game Match Officials Ltd (PGMOL) is a company that provides referees for professional football matches. PGMOL would engage some referees who would officiate matches in their spare time and work on a part-time basis. PGMOL classed the part-time referees as self-employed, and therefore did not class the fees paid to them as employment income.

However, the part-time staff were subject to various levels of control, including adherence to codes of conduct, performance assessments and potential disciplinary actions. Therefore, HMRC argued that these factors suggested an employment relationship existed between PGMOL and the referees.

The Court of Appeal agreed with HMRC, ruling that these referees were employees due to the significant degree of control exercised by PGMOL. The case was then escalated to the Supreme Court which held there was sufficient mutuality of obligation, meaning both parties had binding duties.

Although either party could withdraw before the match, this did not negate the obligations once the assignment was accepted. The Supreme Court also found that PGMOL maintained significant control of the referees by way of performance assessments and disciplinary procedures. Ultimately, the Supreme Court confirmed that these engagements met the criteria for employment contracts, meaning referees were employees for tax purposes.

This case clarified how employment relationships are defined in contracts with multiple short-term engagements, setting a precedent for determining employment status for tax purposes.

Discrimination

The case of British Airways PLC v Rollett and Others 2024 involved claims of indirect discrimination following scheduling changes implemented during British Airways’ restructuring. The changes disproportionately affected specific groups of employees who lived abroad and commuted (predominately non-British nationals), and employees with caring responsibilities (predominately women with childcare responsibilities). Therefore, the restructuring resulted in indirect discrimination against individuals with the protected characteristics of sex and race.

Indirect discrimination claims were also made by those who did not have the above protected characteristics but experienced the same disadvantage as those who did.

The Employment Tribunal (ET) found jurisdiction under Section 19 of the Equality Act 2010 to hear these claims, interpreting the law to align with the principle of equal treatment. The Employment Appeal Tribunal (EAT) upheld this, ruling that indirect discrimination could apply to employees who suffer the same disadvantage as those with protected characteristics, even if they do not possess those characteristics themselves.

This decision expanded the understanding of indirect discrimination and demonstrated that individuals can bring claims of indirect discrimination even if they do not personally have a protected characteristic.

Additionally, in Wright-Turner v London Borough of Hammersmith and Fulham and another 2021, Miss Wright-Turner was dismissed during her probationary period after taking sick leave due to PTSD related to her involvement in the Grenfell Tower disaster. The ET found that the London Borough of Hammersmith and Fulham had discriminated against her based on her disabilities, which were ADHD and PTSD. The ET also found that the London Borough of Hammersmith and Fulham had engaged in procedural unfairness, including backdating documents such as letters and fabricating evidence.

The ET awarded Miss Wright-Turner approximately £4.6 million, one of the highest awards in discrimination cases in the United Kingdom. This amount included compensations for past and future loss of earnings, damages for injury to feelings, pension losses and psychiatric harm. An additional £15,000 was awarded as exemplary damages due to the London Borough of Hammersmith and Fulham’s dishonest conduct.

This case highlights the importance of employers following fair processes and acting transparently. Additionally, this case serves as a reminder of the financial, legal and reputational risks of failing to support employees with disabilities.

Industrial action and conflicting rights

The case of Mercer v Alternative Future Group Limited 2024 addressed important questions about workers’ rights to participate in lawful strikes during working hours. In particular, this case focused on whether rights under the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) are compatible with Article 11 of the European Convention on Human Rights (ECHR), which protects the right to strike.

An employee who was also a union representative, participated in lawful strikes organised by her union during working hours. Alternative Future Group Limited (AFG) suspended the employee during the strikes and issued a written warning. The employee claimed this action constituted detrimental treatment in retaliation for her union activities, contrary to section 146 of TULRCA.

The ET initially ruled against the employee, stating that section 146 did not protect workers from detriments for participating in strikes. Upon appeal, the EAT reversed this decision, suggesting that section 146 could be interpreted compatibly with Article 11 by expanding its scope. However, the Court of Appeal overturned the EAT’s decision, ruling that such an interpretation would amount to judicial overreach and that the gap in protection should be addressed by legislation.

Ultimately, the Supreme Court declared section 146 incompatible with Article 11 insofar as it fails to protect against non-dismissal sanctions for lawful strike participation. However, the Supreme Court refrained from rewriting the legislation, stating this responsibility lies with Parliament.

This decision emphasises the vulnerability of UK workers to employer retaliation for lawful strike action. It pressures the government to amend the law to align with the ECHR, potentially reshaping employer-employee relations regarding industrial actions. However, the government has yet to act on this, leaving the issue unresolved for now.

As always, we will keep you informed of any significant updates in employment law cases throughout 2025. These updates will be featured in our weekly employment newsletters to ensure you stay informed on the latest developments. If you have questions about any of the above cases, please get in touch by email at employment@warnergoodman.co.uk or call 023 8071 7717.