Our February update considers recent developments in employment law, including cases on discrimination and equal pay. We also outline other points of note, including developments relating to right to work checks, the Equality and Human Rights Commissioner’s report on gender pay gap reporting and the government’s consultation on extending redundancy protection for women and new parents.

Duty to make reasonable adjustments arises once an employer ought to have known about a disability

An employer’s duty to make reasonable adjustments only applies when the employer has actual or constructive knowledge of a disability. One requirement needed to satisfy the definition of ‘disability’ is that the medical condition has lasted or is likely to last for at least 12 months.

In this case, the EAT overturned an Employment Tribunal’s finding that an employer had no knowledge of the employee’s disability, despite evidence demonstrating that the employer ought to have had reasonable knowledge of the employee’s disability some months earlier.

The employee had notified her employer about suffering from long-term Post-Traumatic Stress Disorder (PTSD) in July 2012, after a period of four months’ sickness absence which had been caused by workplace issues. The Employment Tribunal held that the employer did not know that she had a disability until November 2012, when the employer received an Occupational Health report confirming that the employee’s current symptoms had lasted for over 12 months. The Employment Tribunal therefore held that the employer’s duty to make reasonable adjustments was not triggered until it had this knowledge in November 2012.

The EAT disagreed and said that the employer had actual knowledge of the employee’s disability when she informed them of her PTSD in July 2012. In any event, the employer also had constructive knowledge of her disability by that time – that is, it reasonably ought to have known she was disabled – as she had already been off sick for four months and the workplace issues that had triggered her sickness absence would not quickly be resolved. The duty to make reasonable adjustments was therefore triggered at that point.

Why this matters?

This case is a useful reminder of the risk employers face by claiming not to have knowledge of an employee’s disability until they have received an Occupational Health report. Occupational Health can assist employers with the management of employees who suffer from medical conditions. However, if there are concerns that an employee may be disabled, this case demonstrates that it is advisable to make a referral to Occupational Health sooner rather than later. Employers will not avoid the duty to make reasonable adjustments where, in the circumstances, they reasonably should have known, about an employee's disability. Examples of “warning signs” for employers may include behavioural changes demonstrated by an employee, or as in this case, a number of months of sickness absence.

Court of Appeal confirms that claimants bear the initial burden of proof in discrimination claims

The Court of Appeal has overturned an EAT decision and restored the orthodox position on burden of proof in discrimination cases. This case re-affirms that the burden of proof initially lies with the claimant.

The EAT had held, contrary to the long established burden of proof principles set out in case law, that the Equality Act 2010 did not place any burden on a claimant to establish a prima facie case of discrimination, but rather that an Employment Tribunal should consider all evidence, from all sources, before deciding whether there are facts from which it could conclude that discrimination occurred.

On the facts of the case itself, the Court of Appeal said that the allegations of race discrimination made by the claimant were mere assumptions that were not supported by evidence, and that such evidence was required in order for him to discharge the initial burden of proof and so establish a prima facie case of discrimination. Accordingly, the employer had not directly discriminated against the claimant.

Why this matters?

The Court of Appeal has provided helpful clarity on this issue. The approach advocated by the earlier EAT decision could in some situations have made it harder for employers to defend discrimination allegations where claimants do not put forward evidence that on the face of it suggested discrimination.

Court of Appeal holds that transitional provisions in government pensions schemes were age discriminatory

The UK government has introduced new, less generous, pension schemes for judges and firefighters. The changes, broadly speaking, included transitional provisions that meant that members who were within 10 years of normal pension age could remain members of the old schemes, with tapered protection for those who were between 10-14 years from the normal pension date. Anyone who was in excess of 14 years from retirement date had to move to the new scheme. The government’s reasoning for the transitional provisions included arguments that those closer to retirement age had less time to re-arrange their affairs before retirement, and that the government wanted to maintain consistency with the changes it had made to other public sector pension schemes.

It was accepted that the pensions changes the government had introduced were discriminatory, unless the government could objectively justify them as being proportionate means of achieving the government’s legitimate aims.

The Court of Appeal held that the government’s objective justification arguments were unsuccessful, finding that the purported social policy aims did not stand up to scrutiny. The desire to protect those closer to retirement age was irrational, given that those individuals were least affected by the changes. There was also a lack of economic analysis to demonstrate why the changes were justified. Further, in terms of consistency of treatment, the judges' position was so different from those of other public servants that true comparisons could not be made in relation to the judges’ pension scheme.

Why this matters?

This case has a great cost impact for the public sector. However, it is of significant importance more generally to any employers operating age discriminatory arrangements as they will need to be able to evidence that they can objectively justify the arrangements. Among other things, this includes showing that there is a legitimate aim in place, supported by a reasoned analysis. It is not enough to merely assert an aim which is supported only by assumptions and generalisations.

Lord Chancellor and another v McCloud and others; Secretary of State for the Home Department and others v Sargeant and others

Court of Appeal rules that multiple equal pay claims can be put on the same ET1 provided jobs are similar

The Court of Appeal has held that multiple equal pay claimants can submit their claims on one ET1 if their roles are similar to each other and claims can properly be said to be “based on the same set of facts”. It is not, therefore, necessary for the roles to be identical, or for all of the claimants to compare themselves to the same comparator. The Court of Appeal, however, highlighted that in equal pay claims, “piggyback” claims by male claimants should not be made on the same ET1 as female claimants, as these could not be said to be “based on the same set of facts”.

Why this matters?

Whilst there are currently no Employment Tribunal fees in place, the Ministry of Justice has suggested that these may be reintroduced in the future. If this happens, there could be financial implications for claimants who are looking to issue multiple claims and who may be more inclined to submit claims on one ET1, rather than wait for them to be joined later as part of a case management exercise. Employers should, therefore, be alive to the potential to argue that multiple claims submitted on the same ET1 are not “based on the same facts”.

Right to work checks: In April 2018, the Home Office launched its online Right to Work Checking Service, which allows employers to check a person’s right to work and any associated restrictions. Whilst previously employers were required to request paper documents alongside carrying out the online check, effective from 28 January 2019, employers can now rely solely on an online check of a prospective employee’s right to work, provided that the person has an immigration status that can be checked using the online service.

Gender pay gap reporting: The Equality and Human Rights Commission (EHRC) has published a report which encourages employers to effectively use the narrative report alongside the pay and bonus gap figures which they are required to publish. Whilst the narrative is not compulsory, the EHRC’s report highlights that it provides a helpful opportunity to organisations to explain any gaps and set out their plans to improve or eliminate gaps. The report also offers suggestions as to action employers can take to tackle its pay gaps, including flexible working, anonymised CVs and applications, mixed-sex interview panels and apprenticeships.

Extending redundancy protection for women and new parents: Following issues raised by the Women and Equalities Select Committee in their 2016 report, and by the Taylor Review of modern working practices, the government has launched a consultation on extending redundancy protection for women and new parents. The consultation seeks views on whether: (i) protections against redundancy for a period following return to work after maternity leave should be aligned with those in place during maternity leave, and whether 6 months is a sufficient period; (ii) “pregnancy” for redundancy protection purposes should start at the point a woman notifies her employer in writing that she is pregnant; (iii) such protection should be replicated for other types of family leave; and (iv) any further steps should be taken to provide guidance on employment rights of pregnant women and new mothers. The consultation closes on 5 April 2019.