Is failing to offer an Employee overtime a detriment?

11 Feb 2011

The case of Arriva London South Ltd v Nicolaou UKEAT considered an employer’s policy of only making overtime available to those workers who had opted out of the 48 hour working week established by the Working Time Regulations 1998 (“WTR”).

The Claimant, Mr Nicolaou, was employed by Arriva London South, a bus company. On a regular basis, he used to work overtime during his days off. He was subsequently asked to sign an opt out agreement (opting out of the 48 hour week). He refused to do so.

In 2008, Arriva introduced a policy which stated that any employee who had not signed an opt out agreement would not be offered overtime.

Regulation 45(A) protects an employee from being subjected to a detriment for refusing to forgo their rights under the WTR. The Claimant therefore brought a claim that he had been subjected to detriment for refusing to opt out of the 48 hour week.

The Tribunal at first instance considered that there was clearly a detriment, in that, had it not been for the Claimant’s refusal to sign an opt out agreement, he would have been offered overtime.

The Employment Appeals Tribunal (“EAT”) overturned the Tribunal’s decision and has submitted the case for a rehearing. In reaching the decision, the EAT considered that the Employer’s conduct could have been motivated by its desire to comply with regulation 4(2) of WTR (that an employer shall take all reasonable steps to ensure that the limits set out in the WTR are complied with). The EAT concluded that the Tribunal had failed to consider the tension between regulation 4(2) and regulation 45(A) (the weekly limit) and that this may have detrimentally impacted on the Tribunal’s decision.

Unfortunately, the EAT did not give any guidance as to how to deal with the conflict between regulation 4(2) and regulation 45(A). However, there is clearly a tension between the two provisions. This case could have a significant impact on a number of employers and their overtime policies and we will therefore keep you updated of the outcome of the rehearing.