A disabled employee was not treated unfavourably when his enhanced pension on ill-health retirement was based on the salary he earned when working part time due to his disability, rather than his full time salary.

The facts

Mr Williams, who is disabled, suffers from Tourette's syndrome, obsessive compulsive disorder and depression. Because of this, he reduced his hours, and his pay was reduced accordingly. After his condition had deteriorated, he took ill-health retirement at the age of 38. Under the rules of Swansea University's Pension Scheme, he was allowed to take his accrued pension benefits immediately, and without any actuarial reduction for early receipt, rather than having to wait until his normal pension date nearly twenty-nine years later. His benefits were therefore significantly enhanced, in that he was treated as though he had accrued nearly twenty nine years further pensionable service.

Mr Williams argued that, by using his actual part time salary rather than a full time equivalent, the calculation of the enhancement to his benefits for the period after he took ill-health retirement amounted to unlawful discrimination arising from disability. This claim was successful at tribunal level. In reaching its conclusion, the tribunal accepted that the meaning of "unfavourable treatment" could be equated with that of "detriment".

The University successfully appealed to the EAT. Mr Williams appealed to the Court of Appeal arguing that:

  • His enhanced pension was based on part time rather than full time salary. This was to his disadvantage and was therefore unfavourable treatment.
  • The disadvantage occurred because he had had to reduce his hours, which was because of his disability.
  • He had therefore suffered discrimination arising from a disability, subject to any justification arguments.

The Court of Appeal agreed with the EAT, finding that:

  • Under the scheme rules, the only employees entitled to retire early and to receive an enhanced pension were those who retired through ill health and who were necessarily disabled.
  • Mr Williams had been treated advantageously in comparison to non-disabled employees.
  • There is no authority that a claim of discrimination arising from a disability can succeed because an individual who is treated advantageously thinks they could have been treated better.
  • The simple fact that Mr Williams was working part time hours because of his disability could not be enough to shift the burden onto the employer to justify the treatment. If it were, then it would be difficult to see why an employer would not also have to justify the pay it was giving to a disabled claimant who had never been able to work full-time and therefore had applied for and secured a part time job.
  • A disabled person who is treated advantageously because of their disability, but not as advantageously as a person with a different disability, does not have a valid claim on this basis.

What does this mean for employers?

The good news for employers is that, following this decision, treatment which is advantageous will not amount to unfavourable treatment just because it could have been more advantageous. However, it is possible that this case will be appealed to the Supreme Court.

Williams v Trustees of Swansea University Pension and Assurance Scheme Trustees