The Equality Act 2010 (EqA), like the Disability Discrimination Act 1995 (DDA) before it, imposes a duty on employers to make reasonable adjustments to their practices and procedures so as to not put employees with a disability at a substantial disadvantage. Whether an employer has breached this duty will depend upon whether the particular adjustment is "reasonable".
An important case decided by the EAT today has considered the extent to which cost is a legitimate factor in assessing reasonableness. Significantly, in rejecting a claim for disability discrimination, the EAT has held that the employer's failure to make adjustments was not unreasonable due to the high costs involved and, furthermore, the claimant's treatment in the case was not because of her disability but due to the costs of the necessary adjustments.
The Cordell case
Ms Cordell is employed by the Foreign & Commonwealth Office (the FCO). She is profoundly deaf. In 2006 she took up the post of First Secretary to the Polish Embassy, a role which fulfilled very successfully with the aid of lip speakers (who are trained to repeat spoken communications from a third party, enabling Ms Cordell to lip read what is said). The average annual cost of lip speaker support in Poland was £146,00.
In 2009 Ms Cordell applied for a promotion to the post of Deputy Head of Mission in the embassy in Kazakhstan. She was successful in the selection process. Just months earlier, however, the FCO had introduced a Reasonable Adjustment Policy requiring that any adjustments for disabled employees costing more than £10,000 would be subject to a special procedure to assess reasonableness. The FCO estimated the costs of providing lip speaker support to Mrs Cordell in Kazakhstan to be in excess of £250,000, clearly triggering its special procedure. Following months of review and consultation with Ms Cordell, the FCO concluded that cost and anticipated practical problems meant the adjustment was not reasonable and Ms Cordell's appointment could not proceed.
Ms Cordell raised a grievance in respect of FCO's decision and subsequently commenced employment tribunal proceedings alleging disability discrimination, by reason of the fact the FCO had applied a cap and special procedure to her disability related adjustments but not to other staff allowances it offered and had treated her less favourably for a reason related to her disability. She also claimed FCO had failed in its duty to make reasonable adjustments.
Before the Employment Tribunal
The precise cost of providing lip speakers was disputed but was found by the tribunal to be at least £249, 500 per year. A key element to Ms Cordell case was that the FCO paid other allowances to staff which were not subject to the same £10,000 threshold or scrutiny. She specifically cited an education allowance for parents working overseas (intended to offer financial support for boarding school costs or similar expenses) which, for some larger families, resulted in payments of up to £175,00 per annum. She suggested that it was discriminatory to deny her the posting on the grounds of cost when this was not a consideration in relation to educating children.
The tribunal agreed with the FCO in dismissing Ms Cordell's claims. It acknowledged that, to succeed in her claim of disability discrimination, Ms Cordell needed to identify a real or hypothetical comparator. However, it rejected Ms Cordell's comparison with parents receiving the education allowance, finding that, were Ms Cordell herself a parent, she too would have access to this allowance. The reason for Ms Cordell's treatment, the tribunal found was not her disability but the costs associated with the necessary adjustments.
On the question of reasonableness, the tribunal concluded that the provision of lip speakers was not reasonable. DDA identified various factors an employer was obliged to take in to account in determining reasonable adjustments (which are not repeated in EqA but remain relevant through EHRC guidance) and these include cost and the extent of the employer's financial and other resources. Whichever cost estimate was applied, the tribunal said, it was "plainly excessive", being some six times Ms Cordell's salary, more than UK staff salaries in Kazakhstan and more than half of the FCO budget for reasonable adjustments.
The decision of the EAT
The EAT has today upheld the decision of the employment tribunal and, to a large extent, its reasoning. The EAT was satisfied that the reason for Ms Cordell treatment was the cost of providing her with support necessary to do her job, coupled with uncertainty about whether such support would be available. It also agreed with the tribunal that parents who were eligible for the education allowance were not appropriate comparators and went further by rejecting any suggestion that tribunals must evaluate in depth employers reasons for offering various employee allowances so as to support claims for similar payments to disabled employees.
Critically, on the question of reasonableness of the adjustments, whilst acknowledging there is no objective measure by which to balance the opposing interests of employee and employer, the EAT highlighted a number of relevant (though non-exhaustive) issues:
- the size of any budget dedicated to reasonable adjustments;
- what the employer has chosen to spend in comparable situations;
- what other employers are prepared to spend; and
- any collective agreement or other indication of what level of expenditure is regarded as appropriate by representative organisations.
Just as importantly for employers, it also emphasised that these can be of no more than suggestive or supportive value and a relevant factor must also be how much time and effort should be put into investigating them.
The case is unusual in its emphasis on costs alone and sees the EAT signal clearly that cost is understood to be a central issue to the question of what is a reasonable adjustment, although by no means the only consideration. The EAT has also provided useful indication of the sorts of issues that ought to be considered in this context, some of which are surprising and may be difficult to include in practice, such as what other employers are prepared to spend (how many employers will have access to this information?).
The EAT were inevitably mindful of the fact that the FCO in this case had made considerable effort to consult with Ms Cordell and to justify its conclusions. This is particularly relevant for public authority employers going forwards and who are now subject to a specific duty to have regard to the need to eliminate unlawful disability discrimination and to promote equality of opportunity for disabled persons under EqA. However, the fact that the EAT saw fit to refer to proportionality in the steps employers take to justify their decisions may give some comfort to all employers that expectations will not be unrealistic.