The Employment Appeal Tribunal has held that protecting a disabled employee’s pay can be a reasonable adjustment. In this case, due to worsening back problems, the employee became unfit for his job working on the maintenance and repair of cash dispensing machines. He was moved to a more junior role that required less physical activity at the same rate of pay. The employee understood the new role to be long term. However, the employer subsequently sought to reduce his pay by 10% and when the employee refused to accept the reduction he was dismissed.
Does this mean that disabled employees will always be eligible for pay protection?
There is no reason in principle why pay protection, in conjunction with other measures, cannot be a reasonable adjustment as part of a package of measures to help an employee get back to or stay in work. Pay protection is nothing more than another form of cost for an employer, comparable to the cost of providing extra support or training, and there is no reason why one should be a "step" as part of a reasonable adjustment but the other should not. However, whether it will be reasonable for an employer to have to take such a step will depend on the particular circumstances of a case and the financial considerations would have to be weighed in the balance by a tribunal if a claim were made.
In this case, the employee had been paid at the higher rate of pay for nearly a year and had been led to believe that the arrangement would be long term. The employer was a company with substantial resources and could easily afford to pay the higher rate.
The employer’s argument that paying him the higher rate would likely cause discontent from other employees was dismissed because the impact on other employees of an adjustment is not normally a factor that should be taken into account when determining reasonableness, although wider implications on an organisation or a workforce as a whole can be taken into account.
Employers are reminded of the need to do the basics well, such as being transparent when dealing with staff. It shows the importance of managing employee’s expectations and proactively dealing with the employment relationship rather than avoiding difficult conversations and allowing the dust to settle. If an employer has coherent reasons for why such adjustments would not be reasonable, there is nothing intrinsically unfair in asking employees to work under the terms applicable to any alternative position. Although an employee would still need to agree to such changes, whether they were reasonable adjustments or not, and employers should think carefully before seeking to reduce an employee’s pay or deciding to dismiss.
Case reference: G4S Cash Solutions (UK) Limited v Powell