He has never tasted demotion as a manager, but Jose Mourinho’s team doctor recently experienced this fate and the incident involving Eva Carneiro highlights some interesting HR/employment law issues for businesses. As a brief reminder, Chelsea manager Mourinho decided that Ms Carneiro, Chelsea’s team doctor, would no longer be involved in training sessions or matches. Her ‘crime’ was to go onto the pitch towards the end of a game that Chelsea were narrowly winning to treat a player who was asking for treatment. Although Ms Carneiro will retain her job title, it appears that her role has been diminished. Football often marches to its own tune on employment issues, but what are the potential legal issues in a case like this more generally?
Firstly, an employee whose role is unilaterally diminished by his/her employer or who is criticised publicly or in front of colleagues could claim that the employer has breached the implied duty of trust and confidence between the parties and treat himself/herself as being constructively dismissed. An employer does, of course have the right to take action against employees who are not performing their role in the required way or who ignore reasonable management instructions and sanctions may include a demotion or change to duties. However, sanctions should only be applied following an investigation, disciplinary hearing and appeal. In addition, if an employer wants to have the ability to demote an employee or change his/her role, this should be expressly included in the employment contract and/or disciplinary policy.
Secondly, if the employee is being treated more harshly because of their sex, race, religion, etc., he/she could also bring a claim for sex discrimination.
Taking this into account, the key things for businesses to bear in mind when considering whether to demote an employee are:
1. Demotion can be a breach of contract
The ACAS code states that typically, disciplinary sanctions should be a written warning, a final written warning or a dismissal. Therefore, employers must ensure that the contract and disciplinary policy allows for demotion and that the employee’s actions are serious enough to warrant demotion. There is case law that suggests that an employer’s ability to demote as a disciplinary sanction must either be allowed for in the contract of employment or be imposed with the agreement of the employee. Therefore, to fully protect themselves, employers should ensure that employment contracts permit demotion.
2. Demotion is about reality, not labels
In many cases, an employer will not say to the employee that he/she is being demoted or change his/her title or pay. However, this does not get the employer off the hook. If, in reality, the employee’s role changes for the worse, he/she may feel that a demotion has been imposed, leading him or her to resign and bring an employment tribunal claim for constructive unfair dismissal.
3. The discrimination risk
If an employee is demoted (or subjected to any other disciplinary sanction), the business must be able to show that the sanction was for a genuine reason and not due to the employee’s protected personal characteristics (race, sex, disability, age, religion, sexual orientation). Particular difficulties can arise where two employees with different personal characteristics are both disciplined, but receive different sanctions. If an employee who receives a tougher sanction has a protected characteristic, he/she is likely to argue that the harsher treatment was due (at least in part) to that characteristic and bring a complaint of discrimination.