An employer unfairly dismissed an employee as it did not properly consider whether the employee was entitled to ill-health retirement before dismissing him. (Decision by EAT in First West Yorkshire Ltd t/a First Leeds v Haigh ).
Employers should give proper consideration to ill-health retirement (if offered) before dismissing an employee on grounds of incapability, including:
- obtaining medical evidence from an appropriate source (which could include a specialist); and
- ensuring that such evidence addresses whether the employee meets an ill-health retirement scheme's requirements.
This will help avoid successful unfair dismissal claims.In particular an employer should not dismiss an employee in order to avoid the cost of ill-health retirement as this is very likely to amount to an unfair dismissal.
The Claimant was employed by the Respondent as a bus driver. The Respondent provided a pension scheme to its employees which contained an enhanced ill-health retirement pension. This was available to employees who were permanently incapacitated.
The Claimant suffered a suspected stroke in June 2005. The DVLA suspended his PSV licence for a year. The Respondent sought advice from its occupational health adviser who said that the Claimant might be able to undertake alternative duties before June 2006. The Respondent therefore concluded that the Claimant's incapacity was not permanent.
The Claimant then suffered a further suspected stroke in October 2005 and the earliest date he could resume driving was October 2006 (when the Claimant would be 60). The Respondent dismissed the Claimant and he appealed.
The Respondent again obtained medical advice from its occupational health adviser. The adviser suggested that at that time the Claimant's condition could not be classified as permanent and that he would be likely to be fit for alternative duties before October 2006. However, the adviser said he would write to the Claimant's specialist for advice on this.
The Respondent dismissed the Claimant's appeal before obtaining the specialist advice sought.
The Tribunal upheld the Claimant's claim for unfair dismissal. It criticised the Respondent's insufficient consideration of the medical evidence at each stage of the procedure, particularly the availability of ill-health retirement.
The EAT upheld the Tribunal's decision. It considered that where an employer provides an ill-health retirement scheme, it will be expected to take reasonable steps to ascertain whether the employee is entitled to the benefit of ill-health retirement.
The EAT held that the Respondent did not answer the question of whether the Claimant's condition was permanent before dismissing him. The occupational health adviser had written to the specialist for an opinion and the Respondent should have waited for that opinion before deciding to dismiss. Further, the EAT agreed with the Tribunal that it appeared that the Respondent had dismissed as it wanted to avoid the cost of the Claimant taking ill-health retirement.