Employment Law and Climate Change

Contents

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    Climate change and employment are closely linked. The physical impacts of climate change can have significant impacts on individual workers, and also pose systemic risks to economies through reduced labour productivity. Similarly, policies enacted to address climate change will have major ramifications on employment – leading to increased opportunities in some sectors and the need to retrain employees in others. Workplaces are, of course, a key source of emissions in themselves, and there may be disagreements between employees, businesses, and other stakeholders about the way in which workplaces should reduce emissions. 

    The link between climate change and employment may interact with a number of legal issues including whistleblowing legislation and antidiscrimination rules. It may also test the limits of certain regulation that requires, for example, workplaces to maintain a reasonable temperature. More broadly, many businesses are changing internal policies in response to the climate crisis. Employers and employment lawyers may continue to drive climate action through encouraging climate action in employment contracts and pensions. Trade unions will also play an important role in driving the net zero transition, and the International Labour Organization will likely continue to scale up its action in this area.

    • Industrial changes during the net zero transition, for example the shift from fossil fuels to renewable energy sources, are increasing demand for some skills whilst decreasing demand for others. Employers are seeking employees with climate credentials, and climate change is also factoring into prospective employees’ choices as they consider different opportunities.
    • Employees may rely on whistleblowing rights under the Employment Rights Act to expose employers which cause serious damage to the climate or fail to comply with climate-related legal obligations. Employees also have legal protection from discrimination on the basis of believing in climate change.  
    • Employment contracts and workplace rules can reward employees that take climate action. Employers and employees can also select pension schemes with sustainable investments, and selecting such schemes may be easier now that larger schemes have legal duties to report on their exposure to climate risk.
    • The International Labour Organization (ILO) aims to address climate change through existing international labour standards as well as general knowledge sharing and capacity building activities.

    How climate change is impacting employment law

    Social and industrial transition

    Before outlining specific legal issues related to employment and climate change, it is worth considering the net zero transition’s general impact on work. Reaching net zero will mean phasing out certain industries and scaling up others – this has a significant impact on the labour force. Research from the Place-Based Climate Action Network (PCAN) suggests that around one in five UK workers will be impacted by the net zero transition – about half of which will require upskilling, and half will become in high demand. These impacts are highlighted in PCAN’s Just Transition Jobs Tracker. This transition will manifest differently in different workplaces. While workers with skills that are in high demand will benefit, there may be some stakeholder tensions in businesses where employees have skills that will not be as valuable in a net zero society.[1]

    Aside from workplaces which are directly impacted by the net zero transition, all workplaces are changing due to growing awareness of climate change, which may have legal implications.[2] This impacts talent acquisition – many workers, especially those in younger demographics, are considering the climate credentials of prospective employers. Likewise, employers in various sectors are also looking for employees with climate-related skills or knowledge. These changes in attitudes may have legal implications where an employee wishes to highlight behaviour from their employer that has negatively impacted the environment or feels discriminated at work based on their commitment to climate change, both situations are examined below. Employers may also change internal policy to ensure that their employees receive adequate training and education on climate change, or even tie remuneration to ESG metrics.[3]

    Physical climate impacts

    Physical risks caused or accelerated by climate change include extreme weather events and rising temperatures can impact many workers. While the UK suffers from relatively fewer natural disasters than much of the world, rising temperatures have and will continue to impact workplaces. The International Labour Organization (ILO) notes that Northern Europe will be relatively shielded from productivity losses due to heat stress,[4] but given more frequent temperature extremes this remains a salient risk to many UK workplaces. The Workplace (Health, Safety and Welfare) Regulations 1992 require that employers keep workplaces at a “reasonable” temperature.[5] The Approved Code of Practice sets a minimum temperature, but not a maximum temperature. Given that many workplaces in the UK do not have air conditioning, there may be a growing number of legal challenges regarding when heat becomes ‘unreasonable.’ As these risks become more prominent, the Health and Safety Executive may suggest a maximum temperature in the Approved Code of Practice.

    Flooding may also impact workplaces – with some estimates finding that almost a third of British commercial premises are at risk of flooding. Similarly, rising sea levels might put some workplaces in certain parts of the country at risk. Depending on the terms of relevant employment contracts, this may cause legal issues when, for example, an employee needs to take emergency leave or wishes to be compensated for time taken off work.

    Whistleblowing

    Employees in the UK have fairly broad rights with regards to whistleblowing and the environment. The Employment Rights Act 1996 protects employees from dismissal or suspension if they are disclosing information showing “that the environment has been, is being or is likely to be damaged”.[6] This provision is clearly relevant to climate change, so employees may be within their legal rights to highlight behaviour of their employer which is clearly aggravating climate change. Protected disclosures must also be in the public interest[7] – this is unlikely to be a significant barrier as addressing climate change serves the public interest, though may mean that there is some threshold to the significance of the relevant action’s impact on the climate for a disclosure to be protected. Other justifications for a protected disclosure may also be relevant to climate change. Disclosures can be protected if they show that a criminal offence has been committed, which would include environmental crimes.[8] They may also be protected if they show that a person has “failed, is failing or is likely to fail to comply with any legal obligation”[9] – as mandatory climate disclosures and many other corporate climate obligations become commonplace, this provision could apply to a broad range of climate-related whistleblowing activities. In a 2020 case, M Carr v Bloomberg, a former employee of Bloomberg LP claimed unfair dismissal contrary to the Employment Rights Act 1996 because “he raised weighty concerns about the respondent’s [Bloomberg] coverage of climate change and made a whistleblowing report.” Pointing to the potential use of whistleblowing in employment disputes, the claim was dismissed in December 2021 due to insufficient evidence on the grounds of the claimant’s “ordinary” unfair dismissal claim.  

    Discrimination

    There is a strong link between climate change and equality through issues such as human rights concerns and the concept of a ‘just transition’. This link is also evident in the context of employment law: a belief in climate change may be a protected philosophical belief on which an employer cannot discriminate against their employees. The Employment Tribunal confirmed this in Grainger v Nicholson in 2010.[10] Since 2010, public acceptance of the science behind climate change has grown in the UK meaning that instances of discrimination based on this belief may be much rarer. Nonetheless, antidiscrimination rules remain an important backstop to ensure that employees can comfortably discuss and engage with climate issues in the workplace. There is a question, however, about whether this precedent might also protect employees that refuse to take certain climate-related action on the basis of their lack of belief in climate change.[11]

    General changes to the workplace

    Remote working became the norm for many office spaces during the COVID-19 pandemic, and there may be sustainability-related justifications for encouraging remote or hybrid approaches to work. For example, remote working can reduce energy used in daily commutes, and energy needed to light or heat offices. However, the picture may not be so simple, and traditional working arrangements can be less carbon-intensive depending on factors such as the time of the year and the extent to which electric vehicles are commonplace. Another source of emissions brought to the fore by COVID-19 is business travel. This can represent a significant source of a business’ emissions due to the emissions-intensity of air travel coupled with the frequency of business flights compared to travelling for leisure and the carbon footprint of first and business class tickets when compared to economy class tickets. Employers may introduce new policies as financial incentives and other benefit schemes in order to encourage the transition to a climate-friendly workplace.[12]

    Employment contracts and pensions

    The contract law section of this resource explains how contracts can drive climate action, and this holds true in the context of employment. The Chancery Lane Project, which aims to drive climate action using contracts, has created many clauses aiming to embed climate change in employment contracts. Relevant clauses include allowing paid garden leave if the employee volunteers for an environmental organisation, providing incentives for management teams to meet sustainability goals, and requiring that employers provide climate-related training and education. As businesses continue to embed climate change in their operations, clauses like these may proliferate. Businesses may also be able to demonstrate their commitment to climate change to prospective employees through such initiatives. 

    Employers may also reduce emissions through the pension schemes that they offer or in which they enrol their employees. Under the Pensions Schemes Act 2021, larger schemes must implement climate governance measures and report on their exposure to climate risk.[13] This is significant as it gives employers and employees the chance to scrutinise pension scheme investments in relation to climate change, and to choose pension funds that adequately manage climate risk. In some cases, employees may even legally challenge their pension scheme based on their climate impact.[14]

    Trade unions

    Collective bargaining is important to the dynamic between workers, employers, and the law in the UK. Trade unions therefore have a key role to play in managing the broader industry transitions outlined above. The Trade Union Congress (TUC) has published multiple reports outlining policy positions and recommendations related to climate change and employment. The TUC suggests electing environmental union representatives, and has advocated that this position is recognised in law and that union representatives have legal rights to attend training in order to carry out the functions of this position.[15] The Campaign Against Climate Change Trade Union Group has also produced relevant resources in this area, including a summary report outlining the positions of individual unions on various climate-related issues. Given that the net zero transition will necessarily involve a reduction in the number of people working in certain areas, there may be some opposition to certain policies by certain unions. Nonetheless, union groups have generally recognised the importance of driving climate change and may play an important role in working with businesses, employees, and the government to ensure that workplaces are sustainable and shielded from climate impacts.

    International Labour Organization

    The ILO, of which the UK is a member, sets binding conventions and nonbinding guidelines that may be relevant to climate change. In a 2009 paper, the ILO noted multiple intersections between their rules and climate change – for example through Convention No. 148 which requires protection against air pollution in workplaces, and through rules on hazardous chemicals in Chemicals Convention No. 170.[16] It also affirmed its role in ensuring a just transition. The ILO has set fairly comprehensive ‘guidelines for a just transition towards environmentally sustainable economies and societies for all’. These guidelines include proposals in more areas than just employment law by suggesting broader economic and social policies that could help ensure a just transition. Though these guidelines are not binding in the UK, they may inform future policymaking in this area. Annex I of the guidelines lists a range of ILO conventions, recommendations, and resolutions that are relevant to climate change.

     In 2020, the ILO released a paper outlining the role it may play in addressing climate change.[17] The ILO emphasised its role in producing research and that advances knowledge about climate change’s impact on employment, and in engaging with global climate negotiations under the United Nations Framework Convention on Climate Change. It also emphasised its ability to help build capacity in constituent states to ensure a just transition, which is more relevant to developing countries than to economies like the UK, and to support relevant initiatives in its member states. Finally, the ILO will continue to implement the aforementioned just transition guidelines in all its member states. The ILO may therefore help to inform relevant employment law and policy in the UK, but could also be a platform from which the UK could help ensure that other countries are considering climate change’s impact on the workplace.


    [1] Martin Gelter, ‘Sustainability and Corporate Stakeholders’ (Oxford Business Law Blog, 7 July 2021) https://www.law.ox.ac.uk/business-law-blog/blog/2021/07/sustainability-and-corporate-stakeholders.

    [2] James Davies, ‘Climate Emergency, Work and Law’ (Lewis Silkin, 2021). <https://www.lewissilkin.com/en/insights/climate-emergency-work-and-employment-law>.

    [3]Christel Cacioppo at al., ‘Climate Change and the Workplace: What do Global Employers Need to Know?’ (Freshfields, November 2021)  <https://www.freshfields.com/en-gb/our-thinking/knowledge/briefing/2021/11/climate-change-and-the-workplace-what-do-global-employers-need-to-know/>.

    [4] International Labour Organization, ‘Working on a Warmer Planet: The impact of heat stress on labour productivity and decent work’, (ILO, 2019) <https://www.ilo.org/wcmsp5/groups/public/—dgreports/—dcomm/—publ/documents/publication/wcms_711919.pdf>.

    [5] s 7.

    [6] s 43A(1)(e).

    [7] Ibid. s 43A(1)

    [8] Ibid. s43A(1)(a).

    [9] Ibid. s43A(1)(b).

    [10] [2010] ICR 360.

    [11] Elspeth Wrigley, ‘The Grainger case – a double edged sword for climate change campaigners?’ (UK Human Rights Blog, 18 January 2010) < The Grainger case – a double edged sword for climate change campaigners? – UK Human Rights Blog>.

    [12] Cacioppo et al at n 3.

    [13] s 124.

    [14] Ewan McGaughey et al v. Universities Superannuation Scheme Limited [2022] EWHC 1233 (Ch).

    [15] Trade Union Congress. ‘Go Green at Work: The Union Effect’ in TUC Workplace Manual (2021). < https://www.tuc.org.uk/sites/default/files/2021-04/GoGreen_0.pdf>.

    [16] Lene Olsen, ‘The Employment Effects of Climate Change and Climate Change Responses: a Role for International Labour Standards?’ (International Labour Organization, 2009). <https://www.ilo.org/wcmsp5/groups/public/—ed_dialogue/—actrav/documents/publication/wcms_122181.pdf>.

    [17] International Labour Office ‘The Role of the ILO in Addressing Climate Change and a Just Transition for All’ (International Labour Organization, 2021). < https://www.ilo.org/wcmsp5/groups/public/—ed_norm/—relconf/documents/meetingdocument/wcms_736774.pdf>.