Williams -v- The Trustees of Swansea University Pension and Assurance Scheme

Background

Mr Williams was employed by Swansea University from June 2000 until he retired for ill-health reasons aged 38 in June 2013. He suffered from conditions including Tourette’s that satisfy the definition of ‘disability’ under the Equality Act 2010 (EA10). He was a member of the university’s pension scheme (the ‘scheme’) throughout his employment.

Mr Williams worked full-time for the first 10 years of employment and between 17.5 and 26 hours per week for the remaining three years when fit to do so. At retirement, he was working 17.5 hours per week. The reduction in working hours arose from his disabilities.

The scheme provided for accrual of benefits on a final salary basis until 1 August 2009 and on a ‘CARE’ (career average) basis thereafter. Under the ill-health retirement provisions, Mr Williams was entitled to (i) a lump sum and annuity calculated based on his salary at the relevant times, and (ii) an enhancement to his lump sum and annuity (the ‘enhanced element’) calculated based on his salary at retirement. Only the enhanced element was in dispute.

Section 15(1) EA10 provides: ‘A person (A) discriminates against a disabled person (B) if -

  1. A treats B unfavourably because of something arising in consequence of B’s disability, and
  2. A cannot show that the treatment is a proportionate means of achieving a legitimate aim.’

Mr Williams argued that the enhanced element figure, which resulted from using his part-time rather than full-time salary, constituted unfavourable treatment because of something arising in consequence of his disabilities, i.e. his inability to work full-time. The Employment Tribunal upheld his complaint, but it was overturned by the Employment Appeal Tribunal and the Court of Appeal. The key issue for the Supreme Court was the meaning of the expression ‘treats… unfavourably’.

Supreme Court decision

Unanimously dismissing the appeal, the Supreme Court held that it is necessary first to identify the relevant ‘treatment’ to which section 15 is to be applied. In Mr Williams’ case it was the award of a pension and there was nothing intrinsically ‘unfavourable’ or disadvantageous about that. The Court noted that the only basis on which Mr Williams was entitled to any pension award at that time was by reason of his disabilities; had he been able to work full time, the consequence would have been not an enhanced entitlement, but no immediate right to a pension at all. As such, the award was not in any sense ‘unfavourable’ and could not reasonable have been so regarded.

Implications

The judgment shows a common sense approach to the meaning of ‘unfavourable’, with the Court evaluating all of the facts and circumstances relevant to the case rather than focussing on one specific element that did not operate in the claimant’s favour. When taken as a whole, it is clear that the scheme’s ill-health provisions conferred an advantage on Mr Williams, in that it provided him with an immediate pension which he would not have been entitled to had he not been disabled. Accordingly, the ‘net’ impact of the ill-health criteria was to enhance Mr Williams’ position rather than acting to his detriment.

The decision will help to avoid a raft of similar complaints which may have arisen had the Court determined that Mr Williams was the victim of disability discrimination contrary to section 15. As such, the decision will be welcomed by employers and trustees alike who will not need to consider re-examining past ill-health awards with factually similar circumstances.