|[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]|
United Kingdom Employment Appeal Tribunal
You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> A Ltd v Z  UKEAT 0273_18_2803 (28 March 2019)
Cite as:  UKEAT 0273_18_2803
[New search] [Context] [View without highlighting] [Printable PDF version] [Help]
|At the Tribunal|
HER HONOUR JUDGE EADY QC
Transcript of Proceedings
|For the Appellant||MR CHRISTOPHER MILSOM
Kennedys Law LLP
25 Fenchurch Avenue
|For the Respondent||MR ROBIN ROBINSON
Free Representation Unit
5th Floor Kingsbourne House
229 High Holborn
Disability related discrimination – section 15(2) – knowledge; section 15(1)(b) – justification; loss and mitigation; compensation
It was accepted that the Claimant was a disabled person for the purposes of the Equality Act 2010 - by reason of the fact she suffered from mental and psychiatric impairments, namely stress, depression, low mood and schizophrenia – but she had not disclosed these conditions to the Respondent and had given alternative reasons for health-related absences during her employment. The ET accepted that the Respondent had no actual knowledge of the Claimant's disability but found it should have made more enquiries into the position and that it therefore had constructive knowledge for the purposes of section 15(2) Equality Act.
The Respondent had dismissed the Claimant because of her poor attendance and time-keeping. The first reason related to something arising from her disability; the second did not. The Respondent was able to demonstrate that it had a legitimate aim - in that it needed a dependable person in the Claimant's post – but, the ET concluded, given the intemperate and precipitate nature of the decision-making process, the Respondent could not show its summary dismissal of the Claimant was a reasonably necessary means of achieving that aim. It therefore upheld the Claimant's complaint of unlawful disability discrimination under section 15 EqA.
Going on to consider remedy, the ET sought to apply the guidance in Abbey National plc v Chagger  ICR 397, finding that - had the Respondent made further enquiries - the Claimant would have continued to hide her mental health problems and would have refused to engage with any occupational health or other medical referral that might disclose her history. That being so, the ET found that there would then have been a 50% chance that the Claimant would have been the subject of a non-discriminatory dismissal and that, in any event, her employment would have ended before she had reached two years' service. Allowing that the Claimant's poor time-keeping had also fed into the decision to dismiss, the ET considered that this should result in a 20% reduction in her compensation for contributory fault.
The Respondent appealed against each of these findings.
Held: allowing the appeal in part
On the question of constructive knowledge, the ET had focused on what it considered might have been the further steps the Respondent could reasonably have been expected to take; it had failed, however, to ask itself whether the Respondent could then have reasonably have been expected to know of the Claimant's disability. Its further findings relevant to loss answered that question: had the Respondent made the further enquiries the ET considered might have been expected, it would still not have known of the Claimant's disability because she would have continued to hide the true facts of her mental health condition. That being so, the answer for section 15(2) purposes was that the Respondent neither knew, nor could reasonably have been expected to know, of the Claimant's disability. The Respondent's appeal was allowed on this basis.
As for justification, the question for the ET was whether the Respondent had made good its justification of the Claimant's dismissal. The ET's reasoning went to the question whether the summary nature of the dismissal was justified but did not fully engage with the issue of the dismissal more generally. Doing so, the ET would have needed to take into account the business needs of the employer (Hensman v MoD UKEAT/0067/14 applied) but its reasoning did not demonstrate that it had. Had it been necessary to determine this point, the Respondent's appeal on this ground would also have been allowed.
On the question of loss, in the circumstances of this case, the ET had permissibly taken account of the other, non-discriminatory reason for the Claimant's dismissal (her poor time-keeping) when assessing contributory fault. Ultimately the Respondent's appeal against the ET's findings on loss amounted to perversity challenges and did not meet the high threshold required. If the challenges to the ET's liability findings had not been upheld, the Respondent's appeal on the question of loss would not have been successful.
HER HONOUR JUDGE EADY QC
(1) whether the ET erred in its approach to the Respondent's constructive knowledge of the Claimant's disability;
(2) whether the ET erred in finding that the dismissal - the unfavourable treatment - was not justified, by erroneously including non-discriminatory factors and/or by impermissibly focusing on procedural steps;
(3) given that the decision to dismiss was also taken at least in part for non-discriminatory Reasons, whether the ET failed to properly apportion loss;
(4) whether the ET erred in its approach to the assessment of loss (applying Abbey National Plc and another v Chagger  ICR 624) and/or in terms of its evaluation of the Claimant's contribution?
The Factual Background
"31. Prior to the commencement of her employment the Claimant was asked to explain the 30.5 days' sickness absence recorded during the last year of her employment with her previous employer. She attributed the absences to knee surgery, back and neck injuries resulting from a car accident and incidental minor physical disorders. That answer was misleading, deliberately omitting any reference to her psychiatric conditions. On her own evidence (witness statement, para 11) she had taken six days' leave on account of "work-based stress".
32. Shortly after her employment began the Claimant was supplied with a form which included two "optional" questions (ie answering was optional): whether she had a physical or mental impairment which had a substantial and long-term adverse effect on her ability to carry out normal day to day activities and whether she had a disability which might require adjustments to enable her to fulfil the requirements of her job. She replied "no" to both."
"33. During her time with the Respondents, the Claimant continued to experience severe mental health problems. As before, these tended to be aggravated when domestic and family difficulties (usually to do with housing difficulties or her son's behavioural issues) became particularly acute. On 24 March 2016, less than six weeks after joining the Respondents, she reported to her community psychiatric nurse that she had been made homeless two days earlier and believed she was on the verge of a breakdown. She received psychiatric care and medication was prescribed. Other crises followed intermittently.
34. Consistent with her misrepresentations on joining, the Claimant routinely attributed her sickness absences to physical ailments and, in her dealings with the Respondents, deliberately suppressed any mention of her mental health conditions. There was no sign that this was in dispute until she served her witness statement, which included the brand new assertion that she told Ms Angela Williams, the Respondents' Office Manager, in early March 2017 (by the end of her evidence that she had fixed the date at 1 March) that she had recently been admitted to hospital and was receiving in-patient psychiatric care. For reasons explained in our secondary findings below, we reject her evidence on that point and find that the alleged disclosure was not made."
"4. By the date of dismissal, the Respondents had had sight of a GP certificate of 13 February referring to the Claimant's "low mood", a hospital certificate of 1 March, which stated that she was expected to be an in-patient for four weeks, and a further GP certificate dated 27 March 2017, citing "mental health and joint issues". Both GP certificates declared her to be unfit for work for three weeks."
The ET's Decision and Reasoning
"48 For the purposes of our analysis, the key question is whether the Respondents had constructive knowledge on the date of the alleged unlawful act, namely the dismissal on 18 April 2017. We have recorded in our primary findings the recent information in the hands of the Respondents at the time of the dismissal. It included the GP certificates of 13 February and 27 March and the hospital certificate of 1 March. These materials, it seems to us, amounted to clear evidence that, over a period of more than two months up to the dismissal, during the entirety of which she was away from work, the Claimant experienced a significant deterioration in her mental state and there was a real question about her psychiatric health. We are mindful of the fact that any reasonableness test must take account of the relevant context, which must include consideration of the size and resources of the relevant employer. The corner shop is not to be judged by the standards of a multinational organisation. But the Respondents, although a small employer, are certainly not to be placed in the corner shop category. They run a sophisticated business, have significant resources at their disposal and benefit from a well-educated and well-informed leadership. The Claimant's silence on her mental health could not be taken as conclusive. It is notorious that mental health problems very often carry a stigma which discourages people from disclosing such matters, even to family or close friends. In the circumstances, we conclude that, by the time of the dismissal, it was incumbent upon the Respondents to enquire into the Claimant' mental well-being and that their failure to do so precludes them from denying that they ought to have known that she had the disability."
"49. As explained above, we use the term "justification" as a convenient shorthand. We have reminded ourselves of the wording of the 2010 Act, s15(1)(b), which directs attention to whether the act complained of amounted to a proportionate means of achieving a legitimate aim. There was no dispute that the dismissal was intended to further the legitimate aim of ensuring that the Respondents maintained a reliable accounting function. As to the proportionate means part of the test, despite Mr Milsom's persuasive submissions, we are very clear that the Respondents fall well short of making out the statutory defence. In so far as they are material, our conclusions on the threshold knowledge issue are repeated. The Respondents did not comply with the Code of Practice. They did not hold a return to work meeting. They did not otherwise enquire into the Claimant's current health or her recent problems. They did not propose or moot the possibility of making a referral to OH or involving any other medical expert. Instead, what happened was that Ms Nichol took an intemperate and precipitate decision simply to sack the Claimant on the spot. That was anything but a proportionate thing to do and her action denied her the chance to make a balanced and informed decision. The Claimant's minimal lateness on 18 April 2017 and Ms Nichol's consequential irritation explain but do not begin to justify the drastic step of summary dismissal. There was no need whatsoever for her to act with such haste. Dismissal was plainly not a necessary measure in order to safeguard the legitimate aim which we have identified. Quite the contrary. In the circumstances, the s15 claim succeeds."
"50. We gave our oral adjudication on this part of the case in two stages. First, on the strength of the "liability" evidence alone, we held that there was a 50% chance that, but for the dismissal, the Claimant's employment would have ended without liability attaching to the Respondents no later than the second anniversary of her joining the company. We made it clear that this was a "long-stop" finding and that it was open to the Respondents to contend at the remedies stage for a further diminution in compensation for monetary loss under the Chagger principle, having regard to evidence given as part of the remedies hearing. Our purpose in announcing our "long-stop" finding was to give the parties the best chance of resolving what was left in the case at the earliest opportunity. Neither advocate challenged our approach.
51. Having heard further evidence from the Claimant directed exclusively to remedy, together with additional submissions from both advocates, we gave our second Chagger adjudication. By that stage, as we have noted, the Claimant was not seeking compensation for monetary loss beyond the second anniversary of the commencement of her employment. Our ruling was that there was a 50% chance of the Claimant losing her employment without liability attaching to the Respondents no later than two weeks after her discharge from hospital in or about September 2017.
52. The consequence of our two adjudications taken with the Claimant's adjusted position on the period of loss claimed is that (subject to the question of contributory fault to which we will shortly turn) compensation for monetary loss should be awarded as to 100% until the appropriate date (14 days after discharge from hospital) and as to 50% from that date until 14 February 2018."
"53. Our reasons for our initial adjudication are as follows. The Chagger exercise here requires us to consider what would have happened if Ms Nichol had not acted in the intemperate way in which she did and had taken the proper course of seeking to enquire into the Claimant's health (in particular her mental health) and offered suitable support. We are satisfied that the Claimant would in those circumstances have acted as she has consistently over many years. She would have suppressed information concerning her mental health problems (current and historic) and would have insisted; consistent with the fact that her last GP certificate had expired, that she was fit and able to work normally. She would not have entertained any proposal for an OH referral or other medical examination which might have exposed the psychiatric history. We arrive at this finding with some confidence. No evidence has been put before us of her acting otherwise. Her reticence may be explained by the stigma of mental disability or by a lack of insight into her own condition (something mentioned in the psychiatric reports which we have seen), or both. Perhaps other factors are also at work. In the end, it is not for us to speculate. Nor is it for us to criticise, and our foregoing remarks should not be suggesting any reproach to the Claimant.
54. Faced with a denial of any residual medical problem, how would the Respondents have proceeded? We are satisfied that, acting reasonably and respecting her dignity and privacy (key considerations as the Code of Practice stresses) they would have felt constrained to leave the matter there. What would have been the upshot of the Claimant's return to work? We are in no doubt that, as before, the quality of her work would have remained high, but we are equally clear that further absences would have followed. Some (for surgery in the summer) had already been mentioned to the Respondents. But we are satisfied that other, unscheduled absences would also have arisen. The Claimant's domestic and family problems were likely to continue to lead to a further need for time away from work. And these problems would have been likely to exacerbate her vulnerable mental state and provoke relapses. In addition, she would have persisted in her habit of poor timekeeping, despite the importance which the Respondents attached to it. Unfortunately, as was apparent from the evidence before us, she appears even now to be unable to regard it as important. In summary, the attendance and timekeeping problems would not have been resolved and, doing the best we can, we concluded that there was a 50% chance that they would have resulted in her employment being terminated without liability attaching to the Respondents by the second anniversary of the commencement of her employment (the Respondents being aware that on that date she would acquire the statutory right to protection from unfair dismissal).
55. The reasons for our second Chagger adjudication are these. As already found, the absences and timekeeping problems would have persisted. Those absences included, but were not limited to the scheduled surgery during the summer. The next significant event was the hospitalisation of the Claimant in September. That resulted from a severe mental health episode which was associated with a new housing crisis. None of these problems can be attributed to the dismissal and, we find, all would have arisen as they in fact did, had the Claimant not been dismissed. This is not to say or suggest that she was not affected by the dismissal. On the contrary, as we will explain when addressing injury to feelings, we find that she was hit hard by the initial shock of losing her job and by the longer-term burden of finding herself unemployed. But these considerations do not bear materially upon the Chagger analysis. Here we find that the Claimant's position in the workplace would have been at severe risk by September owing to continuing absences and timekeeping problems. The absence from work in September would have been likely to result in the Respondents calling upon the Claimant on her return to justify the continuation of her employment. Acting fairly and reasonably, they would have made it clear the dismissal was now a real possibility. Faced with that harsh reality, she might have acted as before, suppressing any mention of her mental health problems. On the other hand; she might, realising her job was in extreme jeopardy, have faced up to the need to reveal her mental health background and problems. Had she taken the first course the Respondents would have been likely to terminate her employment on her return. Acting reasonably (our analysis assumes that they would have acted reasonably in all respects), they would have operated some sort of procedure involving a meeting on notice to consider the continuation of her employment and would have paid her in lieu of notice. Any reasonable process would have been completed in two weeks. Had the Claimant disclosed her mental health problems, the Respondents, acting reasonably, would have taken advice, involved OH or other medical resources, considered reasonable adjustments and established a regime for managing her which took account of the fact (or at least, from their point of view, the real possibility) that she was entitled to protection as a disabled person. On this assumption, there is no reason to envisage the Claimant's employment terminating before the end of the period of loss which she claims."
The Relevant Legal Principles
Knowledge of disability
"15 Discrimination arising from disability
(1) A person (A) discriminates against a disabled person (B) if—
(a)A treats B unfavourably because of something arising in consequence of B's disability, and
(b)A cannot show that the treatment is a proportionate means of achieving a legitimate aim.
(2) Subsection (1) does not apply if A shows that A did not know, and could not reasonably have been expected to know, that B had the disability."
(1) There need only be actual or constructive knowledge as to the disability itself, not the causal link between the disability and its consequent effects which led to the unfavourable treatment, see York City Council v Grosset  ICR 1492 CA at paragraph 39.
(2) The Respondent need not have constructive knowledge of the complainant's diagnosis to satisfy the requirements of section 15(2); it is, however, for the employer to show that it was unreasonable for it to be expected to know that a person (a) suffered an impediment to his physical or mental health, or (b) that that impairment had a substantial and (c) long- term effect, see Donelien v Liberata UK Ltd UKEAT/0297/14 at paragraph 5, per Langstaff P, and also see Pnaiser v NHS England & Anor  IRLR 170 EAT at paragraph 69 per Simler J.
(3) The question of reasonableness is one of fact and evaluation, see Donelien v Liberata UK Ltd  IRLR 535 CA at paragraph 27; nonetheless, such assessments must be adequately and coherently reasoned and must take into account all relevant factors and not take into account those that are irrelevant.
(4) When assessing the question of constructive knowledge, an employee's representations as to the cause of absence or disability related symptoms can be of importance: (i) because, in asking whether the employee has suffered substantial adverse effect, a reaction to life events may fall short of the definition of disability for EqA purposes (see Herry v Dudley Metropolitan Council  ICR 610, per His Honour Judge Richardson, citing J v DLA Piper UK LLP  ICR 1052), and (ii) because, without knowing the likely cause of a given impairment, "it becomes much more difficult to know whether it may well last for more than 12 months, if it is not [already done so]", per Langstaff P in Donelien EAT at paragraph 31.
(5) The approach adopted to answering the question thus posed by section 15(2) is to be informed by the Code, which (relevantly) provides as follows:
"5.14 It is not enough for the employer to show that they did not know that the disabled person had the disability. They must also show that they could not reasonably have been expected to know about it. Employers should consider whether a worker has a disability even where one has not been formally disclosed, as, for example, not all workers who meet the definition of disability may think of themselves as a 'disabled person'.
5.15 An employer must do all they can reasonably be expected to do to find out if a worker has a disability. What is reasonable will depend on the circumstances. This is an objective assessment. When making enquiries about disability, employers should consider issues of dignity and privacy and ensure that personal information is dealt with confidentially."
(6) It is not incumbent upon an employer to make every enquiry where there is little or no basis for doing so (Ridout v TC Group  IRLR 628; SoS for Work and Pensions v Alam  ICR 665).
(7) Reasonableness, for the purposes of section 15(2), must entail a balance between the strictures of making enquiries, the likelihood of such enquiries yielding results and the dignity and privacy of the employee, as recognised by the Code.
"It is not enough that a reasonable employer might think the criterion justified. The tribunal itself has to weigh the real needs of the undertaking, against the discriminatory effects of the requirement...Some measures may simply be inappropriate to the aim in question...A measure may be appropriate to achieving the aim but go further than is (reasonably) necessary in order to do so and thus be disproportionate..."
"88 … the general rule governing compensation at common law, and regularly applied to claims in tort, was classically formulated by Lord Blackburn in Livingstone v Rawyards Coal Co (1880) 5 App Cas 25, 39, where he said:
"where any injury is to be compensated by damages, in settling the sum of money to be given for reparation of damages you should as nearly as possible get at that sum of money which will put the party who has been injured, or who has suffered, in the same position as he would have been in if he had not sustained the wrong for which he is now getting his compensation or reparation."
What therefore is required is the comparison of the claimant's current position with what would have been his position if the wrong had not been done. The first step must be to define the wrong in question. … Dismissal is not itself a wrong: what renders it unlawful … is the discriminatory grounds on which it occurs. It is the discrimination which is the essence of the wrong. If that is the right characterisation, then the correct question is what would have happened if the claimant had not been discriminatorily dismissed: that formulation plainly requires consideration of whether the same dismissal might have occurred but on legitimate grounds. …
89 … Despite the conceptual difference between unfair and discriminatory dismissal, they are alike to the extent that dismissal itself is not inherently unlawful and that it is only the additional vitiating factor—unfairness or discriminatory grounds—which renders it so. It would be unsatisfactory if there were a radically different approach to the assessment of compensation between the two situations.
90 … In order to establish liability in the case of common law torts where damage is a necessary part of the cause of action, a claimant only has to show that the alleged tortfeasor materially contributed to the damage in respect of which he claims, and not that his wrongful act was the only or main cause. There is of course a similar rule in cases of discrimination, though the label "material contribution" is not generally used. But that rule is not relevant to the different issue which arises here—namely whether in assessing compensation it is relevant to take into account the chance that the respondent might have caused the same damage lawfully if he had not done so on discriminatory grounds.
91 It might seem unattractive that a discriminator can reduce, and perhaps in some cases extinguish altogether, the compensation which he would otherwise have to pay by taking credit for potential legitimate grounds for his action when ex hypothesis his actual grounds were illegitimate. But the same objection might be taken to the rule in unfair dismissal cases: the answer in both cases is the same, namely that an award on ordinary compensatory principles requires the Polkey question to be asked. It will only assist the respondent if he is able to show that the victim would or might have been dismissed anyway—which will only be an available argument in a fairly limited class of cases (of which discriminatory selection for redundancy may be the most obvious example). In such cases it could equally be said to be unattractive that a claimant should make a "windfall" 100% recovery in circumstances where he was likely to be dismissed in any event, simply because his employer had—it may be subconsciously and only to a small extent—allowed himself to be influenced by discriminatory considerations. There is nothing in the statute to suggest that discrimination is to be treated as a specially heinous wrong to which special rules of compensation should apply."
The Respondent's case
The Claimant's Case
Discussion and Conclusions