United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR JAMES LADDIE (of Counsel) Instructed by: EEF Legal Services Broadway House Tothill Street London SW1H 9NQ
For the Respondent	MR SIMON GOLDBERG (of Counsel) Instructed by: Messrs Thompsons Solicitors The St Nicholas Building St Nicholas Street Newcastle upon Tyne NE1 1TH


 


SUMMARY

Practice and Procedure – Appellate jurisdiction/reasons/Burns-Barke

In a 13-page judgment, the Tribunal recorded in an exemplary form its findings of fact, its summary of the law and the submissions of Counsel. In two paragraphs containing its conclusions it failed to give reasons connecting its findings of fact to the statute. The conclusion did not make sense grammatically or legally.

Two points were allowed on appeal applying subsequent judgments of the Employment Appeal Tribunal, making the basis upon which the Tribunal made its findings unsound: O'Hanlon and Tarbuck. But they did not infect other findings. The case was remitted to the same Employment Tribunal to make findings in accordance with the legal directions given by the Employment Appeal Tribunal, and was free to depart from its earlier findings. Conciliation directed.


 


HIS HONOUR JUDGE McMULLEN QC

1. This case is about disability-related discrimination and reasonable adjustments required to be made for a disabled person. The judgment represents the views of all three members. We will refer to the parties as the Claimant and the Respondent.

Introduction

2. It is an appeal by the Respondent in those proceedings, against what we are told is a reserved judgment of an Employment Tribunal sitting over two days at Newcastle upon Tyne, Chairman Mr R S Drake, registered with reasons on 14 August 2006. The Claimant was represented by Mr Simon Goldberg, and the Respondent was represented here by Mr James Laddie, and there by different Counsel.
3. The Claimant claimed disability discrimination. The Respondent eventually conceded the Claimant was disabled, but denied liability under all three heads of the Disability Discrimination Act 1995.

The issues

4. The central issues, as defined by the Employment Tribunal and as now relevant on appeal, were as follow:

"2.2 Whether the claimant could establish that he had been discriminated against for a reason relating to his disability by being treated less favourably than the respondent would treat others to whom that reason does not or would not apply in circumstances where that treatment was allegedly not justified because the reason for such treatment was not both material to the circumstances of this particular case and substantial.

2.3 Whether the claimant could establish that there existed a provision criterion or practice applied by or on behalf of the respondent which placed him at a substantial disadvantage in comparison with persons who are not disabled to the extent that there thus existed a duty on this respondent to take such steps as are reasonable in all the circumstances of the case for it to have to take in order to prevent the provision, criterion or practice having that effect."

The judgment

5. The Employment Tribunal decided against the Claimant on what the Disability Discrimination Act s3A(5) describes as direct discrimination, but in his favour on his claims that he had been discriminated against on grounds related to his disability and that the Respondent had failed to make reasonable adjustments for him as a disabled person suffering a disadvantage thereby.
6. The Respondent appeals against the judgment. If it succeeded, the Claimant himself sought to cross-appeal on grounds that the Tribunal failed to deal with all the claims he had made before it. Directions sending both to a full hearing were given in chambers respectively by Burton J and Elias J (President).

An overview of the case

7. We will take the same approach as Mr Laddie does in his skeleton argument, and give an overview of this case. We do this because it will be remitted to the same Employment Tribunal with a controlled direction on the law, which is set out in these reasons. It is unnecessary for us to say a good deal about the material in this case. Our task is also facilitated by the acceptance in writing by Mr Laddie of the following:

"The ET set out the issues and the facts in commendable and comprehensive detail. Further, the ET set out the relevant statutory provisions and the parties' submissions in an entirely satisfactory manner. However, there is a marked diminution in quality when the Employment Tribunal set out its conclusions (pp.28-9)."

That too is our independent view of the Employment Tribunal judgment.

8. The assertion by Mr Laddie was met with the somewhat unpromising response from Mr Goldberg, that it was impossible for him to say that the conclusion of the Employment Tribunal was detailed or well ordered. He invited us to find that certain of its conclusions were implicit, and also invited us to dig around in the findings of fact, as he put it. These informed the conclusions. We say in this overview that we are prepared to be generous to the Employment Tribunal's reasoning. The extent to which we should engage in excavation is, in fairness, limited. The conclusions extend to less than one out of the 13 pages of this judgment. They are jejune.

The legislation

9. The relevant provisions are found in the Disability Discrimination Act 1995:

"Section 3(A)(1)

For the purposes of this Part, a person discriminates against a disabled person if—

(a) for a reason which relates to the disabled person's disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply, and

(b) he cannot show that the treatment in question is justified.

Section 3(A)(6)

If, in a case falling in within subsection (1), a person is under a duty to make reasonable adjustments in relation to a disabled person but fails to comply with that duty, his treatment of that person cannot be justified under subsection (3) unless it would have been justified even if he had complied with that duty.

Section 4(A)(1)

Where—

(a) a provision criterion or practice applied by or on behalf of an employer, or

(b) any physical feature of premises occupied by the employer… places the disabled person concerned at a substantial disadvantage in comparison with persons who are not disabled, it is the duty of the employer to take such steps as it is reasonable, in all the circumstances of the case, for him to have to take in order to prevent the provision, criterion or practice, or feature, having that effect.

Section 18(B)(1)

In determining whether it is reasonable for a person to have to take a particular step in order to comply with a duty to make reasonable adjustments, regard shall be had, in particular, to—

(a) the extent to which taking the step would prevent the effect in relation to which the duty is imposed;

(b) the extent to which it is practicable for him to take that step;

(c) the financial and other costs which would be incurred by him in taking the step and the extent to which taking it would disrupt any of his activities;

(d) the extent of his financial and other resources;

(e) the availability to him of financial or other assistance with respect to taking the step;

(f) the nature of his activities and the size of his undertaking;

…

(2) The following are examples of steps which a person may need to take in relation to a disabled person in order to comply with a duty to make reasonable adjustments—

…

(d) altering his hours of working or training;

(e) assigning him to a different place of working or training;

…

(l) providing supervision or other support."

As can be seen, we have omitted s3A(5) which deals with direct discrimination, and is no longer live on appeal.

10. The Tribunal directed itself by reference to those provisions and to what we hold to be the leading authorities. However, time has overtaken these as to two principal issues in the cases of O'Hanlon v Revenue and Customs Commissioners [2006] ICR 1579 (relating to a sick pay policy) and Tarbuck v Sainsbury Supermarkets Ltd [2006] IRLR 664 (relating to an employer's duty to do more than simply consider whether adjustments should be made for a disabled person). We will say more of these.

The facts

11. The Employment Tribunal introduced the parties as follows:

"3.1 The respondents are engaged in manufacturing valve products for the automotive industry and operate on a 7 day per week, 24 hour basis employing 250 people at their north east plant where they derive an annual turnover in excess of £20 million and a most recently declared annual profit in excess of £1 million.

3.2 The respondents operate their activity in teams which include manufacturing technicians such as the claimant, who is still employed by the respondents, and who was engaged to work a weekend shift of Friday, Saturday and Sunday originally on alternate days and nights. The claimant was well regarded as a good worker and enjoyed the confidence of his team leader Mr Kitching and his weekend supervisor Mr Tony Myers.

3.3 The respondents are a large enough organisation to have the services of a dedicated HR manager, Ms Joanna Barnard who was first employed with them in October 2002 and who therefore had gained considerable experience by May 2005 when the claimant was first absent due to illness.

3.4 The uncontested evidence of the claimant which we accept was that from May 2004 he began to suffer disrupted sleep patterns. At the time he was working in an area known as 'pre-operations' and specifically in a section known as 'plasma transferred arc' ("PTA"). This activity involved him managing the operation of 6 machines and inspecting their output on a 100% inspection basis.

3.5 Despite suffering from disrupted sleep from May 2004 onwards the claimant was not absent from work until 13 May 2005, the certified reason for his absence being described as 'depression'".

12. The principal actors in the drama are the Respondent's HR manager (Ms Joanna Barnard), the occupational health physician engaged by the Respondent (Dr Holland), the Respondent's occupational health nurse (Ms Pauline Crannie), and the Claimant's GP (Dr D S Rangar).
13. From May 2005 onwards, it became established and was accepted by the Respondent that the Claimant was disabled as a result of the depression suffered by the sleep patterns which he had encountered. On a number of occasions, opinions were taken from those with an understanding of the issue. The state of affairs relating to the Claimant's deployment extended until November 2005. At this stage, the Claimant was, as it is put, not offered an assurance that his pattern of working, which included nights, would be changed to involve solely days, nor was he actually given a date on which that would start. On the other hand, during the relevant period when his sleep deprivation and depression continued, he was permitted to attend work on a changed contractual roster, which sent him only to day shift. During this period, his entitlement to 13 weeks' full pay expired, and he was receiving no pay, which was in accordance with the Respondent's policy.
14. The Claimant issued his proceedings under the Disability Discrimination Act, whilst of course still employed, on 24 November 2005, at which time he was on day shift. This had followed what the Tribunal found to have been an assertion by the Respondent that, unless the Claimant returned to his contractual basis of working shifts, then his position would be at risk. That was firmly put in his claim form.
15. The medical material available to the Respondent included the opinion of its consultant, Dr Holland, that a period of trial should be permitted of up to three months. During this period the Respondent failed to give any such assurance and indeed indicated that the Claimant would be at risk if he did not resume his contractual obligations. A dispute arose before us about that matter. We were shown a letter of 17 November 2005, which puts the ultimatum squarely, and it is the subject of findings made by the Tribunal, which are that the Claimant's position was at risk if he continued to be unavailable for nights. Those findings are all included within the first eight pages of the Tribunal's judgment. There then follows the description of the law, and the unimpeachable summary of the submissions made by Counsel for each of the parties.
16. The Employment Tribunal then said this on the two issues now live, omitting, as we do, the reference to direct discrimination which occupied only five lines and is not the subject of an appeal or cross-appeal by the Claimant:

"5.2 The Tribunal finds that the claimant did suffer the treatment of not being given prompt assurance that his work pattern could change and suffer the termination of access to the company sick pay scheme or its non-extension, that this was because of his medical condition which the respondent's accepted amounted to a disability whether or not they knew of it at the relevant time. A hypothetical comparator who would not be absent because of illness (i.e., the reason for his absence) therefore would not have suffered a non-extension of sick pay but the claimant was treated less favourably than such a comparator. In the absence of evidence as to consideration of the requirements of section 18(B) and in particular in support of the specific reasons advanced by them, the respondents have not satisfied the Tribunal that they were justified in their less favourable treatment in respect of the claimant and therefore his complaint of indirect discrimination succeeds.

5.3 The Tribunal finds that the practice of ensuring that all employees are subject to the same sickness pay policy and application thereof and the exercise of discretion in relation thereto is a provision or practice which places the claimant in this case at substantial disadvantage in comparison with non-disabled persons. This state of affairs continued to prevail both before and after the claimant was known to be a disabled person and certainly from a point in time when from May 2005 onwards it could be said that the respondents were on notice of the likelihood that he was or could become regarded as being disabled. By reason of the respondent's failure to assess the sort of steps they could take to lessen the adverse impact upon the claimant of their policy as regard to sick pay and their apparent insistence that they wanted the claimant to return to nightshift working all served to demonstrate that they did not take the steps in order to prevent such provision or practice having a disadvantageous or adverse effect upon the claimant. Therefore the claimant's complaint of disability discrimination by reason of failure to comply with the statutory duty as set out in section 4(A) succeeds."

(We should say that as we reproduce these findings, we do so without any correction).

The Respondent's case

17. Mr Laddie, on behalf of the Respondent, submitted that the Tribunal had made a deeply flawed judgment and had failed to discharge its obligations to record proper conclusions related to the findings of fact which it had made and the application of the law to them. He did not shrink from a detailed exegesis of how badly wrong the above paragraphs are. In fairness, he did not simply criticise the grammar and the syntax, but said that it was impossible to make sense of the reasoning in these conclusions and, further, that insofar as sense could be made and the rationale of the Tribunal could be divined, it was wrong in law. The Tribunal had failed to apply the correct test for setting up a comparator for the purpose of disability discrimination, contrary to the judgment of the Court of Appeal in Clark v TDG Ltd (t/a Novacold) [1999] IRLR 319. The Tribunal failed to recognise the distinction between subjective and objective justification in, on the one hand, disability related discrimination and on the other, reasonable adjustment discrimination, for the test under the former is subjective (see Post Office v Jones [2002] ICR 805 CA). The Tribunal had referred in the operative part of its judgment, dealing with disability-related discrimination, to s18B (see above) which deals with adjustments, and is in the wrong place. As to its treatment of reasonable adjustments, Mr Laddie described this is as "simply shambolic".
18. With perhaps more incisive argument, he pointed to the failure by the Tribunal to follow the law as set out in Smiths Detection v Berriman (UKEAT/0712/04), and followed in London Borough of Barnet v Ferguson (UKEAT/0220/06). A number of 'pleading points' (as they are generally known) was taken by Mr Laddie, but we have tried to see the substance of what has occurred in this case. He contends that justification was argued, and justification was properly offered by Ms Barnard on behalf of the Respondent. He further contends that justification is not reached, unless, when the matter is sick pay, an exceptional case is presented.

The Claimant's case

19. On behalf of the Claimant, Mr Goldberg reserved his position on the Tarbuck point, at our invitation, since we had suggested that we (this three-person Tribunal) would be minded to follow the judgments which I gave on behalf of different three-person divisions of the Employment Appeal Tribunal in NCH Scotland v McHugh (UKEATS/0010/06) and Ferguson (UKEAT/0220/06).
20. As to the sick pay issue, he contended that this was a case which did not fall within the remit of O'Hanlon, which was distinguishable, for in the present case no justification was in fact proffered by the Respondent. O'Hanlon involved the cost of extending sick pay beyond a certain period.
21. Inviting us to go into the findings of fact, and for those to inform the conclusions, he indicated that the Claimant had suffered a substantial disadvantage by reason of his treatment by the Respondent, pointing for example to a break-down which he suffered when being put back on to nights. He contended that if he were wrong on the O'Hanlon point and on the Tarbuck point, nevertheless, there were freestanding findings in his client's favour which were not tainted by those errors of law.

The legal principles and our conclusions

22. We will set out our conclusions on the principles advanced before us, and which we hold to be the relevant law, at the same as we deal with the argument.
23. We agree with Mr Laddie's criticism, but not its language. As is conceded by Mr Goldberg, the two-paragraph conclusions at the end of this case are inadequate to express the relationship between the admirable findings of fact, clearly expressed, and the application of the law to them.
24. A Tribunal must set out its reasons and its conclusions so that the parties can see why they have won and lost, see Meek v City of Birmingham District Council [1987] IRLR 250. A Tribunal must deal with the issues which are placed in front of it by the statements of case, that is, the claim and the response, and, as here, the further information provided by way of particulars. It must deal with the arguments advanced by the parties and the evidence which it hears. Relevant in the present case is whether or not justification was an issue to be decided. We are satisfied that justification was defined as an issue at the outset by the Employment Tribunal and is not raised as a new point today.
25. When dealing with claims under s3A, a Tribunal should always approach its assessment by reference to the judgment in the House of Lords in Archibald v Fife Council [2004] 954 ICR at para 32, and as also informed by O'Hanlon at para 23. In summary, this requires the following, for which we are grateful to Mr Laddie for his succinct approach.

(1) Section 3A(l) of the DDA establishes that a person discriminates against a disabled person if, for a reason related to the disabled person's disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply, and he cannot show that the treatment in question is justified. This is routinely known as 'disability-related discrimination'.

(2) Section 3A(2) establishes that a failure to comply with a duty to make reasonable adjustments is also an act of discrimination.

(3) Section 3A(3) defines 'justified' for the purposes of s.3A(l) i.e. disability-related discrimination.

(4) Section 3A(4) establishes that disability-related discrimination cannot be justified if the discrimination also amounts to direct discrimination falling within s.3A(5).

(5) Section 3A(5) establishes that a person directly discriminates against a disabled person if, on the ground of the disabled person's disability, he treats the disabled person less favourably than be treats, or would treat a person not having that particular disability whose relevant circumstances, including his abilities, are the same as, or not materially different from, those of the disabled person. This is the DDA's version of 'direct discrimination', which is practically identical to its forebears in the SDA and RRA.

(6) The effect of s.3A(6), read with the rest of s.3A, is to require an Employment Tribunal hearing an allegation of all three types of disability discrimination (as in this case) to consider disability-related discrimination last. This is because justification cannot be made out if the respondent has directly discriminated against the complainant (s.3A(4)), or if it would not have been justified even had the respondent complied with the duty to make reasonable adjustments in circumstances where the respondent has failed to comply with that duty.

26. It will not be an error of law for the Tribunal to approach matters the wrong way round, but it does put it at risk if it does not follow that logical sequence. In this case, the Tribunal appears not to have done that, and because of the paucity of the reasoning we are unable ourselves to correct that for the Tribunal, or to substitute our view.
27. As to the issue of reasonable adjustments, in this case, we accept Mr Laddie's contention that the reasoning of the Tribunal is unclear and cannot in itself support the judgment. The Tribunal has failed to establish clearly the elements provided in s3A(3) and 4A(1). A comparison must be made with a person who is not disabled. Steps must be set out as to what is required of an employer in order to prevent the measure having the adverse effect upon the claimant.
28. In this case, the provision, criterion or practice applied is, we hold - as appears from the judgment of the Tribunal - the requirement that the Clamant should work nights. That is put in negative and positive terms, either as a failure to assure him, while temporarily deployed on days, that that position would remain or, alternatively, what we hold to be the ultimatum given to him: that his position is at risk if he does not change.
29. The sense of what was going on at this workplace is plain. The Claimant suffered depression; it was attributable to his disturbed sleep and work patterns; it had gone on for more than a year, so he was disabled. The medical advice said that no "decision for life", as the Claimant put it, should be made during the currency of a trial period, and until he was assessed as being better. The Respondent jumped the gun by taking action towards the end of November 2005, during the three months period foreshadowed by its expert. What the Tribunal has failed to do is to apply the judgment in Smiths Detection and set out the sequence of events provided in para 85, which is as follows:

"85. In our opinion an Employment Tribunal considering a claim that an employer has discriminated against an employee pursuant to Section 5(2) of the Act by failing to comply with the Section 6 duty must identify:

(a) the relevant arrangements made by the employer

(b) the relevant physical features of the premises occupied by the employer

(c) the identity of non-disabled comparators (where appropriate) and

(d) the nature and extent of the substantial disadvantage suffered by the Claimant. It should be borne in mind that identification of the substantial disadvantage suffered by the Claimant may involve a consideration of the cumulative effect of both "arrangements" and "physical features" so it would be necessary to look at the overall picture.

In our opinion an Employment Tribunal cannot properly make findings of a failure to make reasonable adjustments under Section 5(2) without going through that process.

86. Unless the Employment Tribunal has identified the four matters we have set out above it cannot go on to judge if any proposed arrangement is reasonable. It simply is unable to say what adjustments were reasonable:

'To prevent the arrangements or feature placing the Claimant at a substantial disadvantage.'"

This was followed and applied as being the law, in our judgment, in Ferguson.

30. The Tribunal also made findings about the failure of the Respondent to consider what steps to take. In this, it relied upon the judgment of the EAT, Keith J and members, in Mid- Staffordshire General Hospitals NHS Trust v Cambridge [2003] IRLR 566. Since then, a substantial number of judgments has considered this point and in Tarbuck (above), Elias J (President) and members decided it would not follow the earlier stream of authority. Since then, in a number of judgments (including two which I gave on behalf of the EAT) it was decided that since Tarbuck could not be said to be demonstrably wrong, the practice would be to follow a recent fully-reasoned judgment of the President in order to avoid confusion, see for example NCH Scotland. Thus, the Tribunal in our case relied upon a judgment which has subsequently been disapproved of in the EAT. It cannot be criticised for that, but Tarbuck would bind it.
31. The forensic position we have reached is that Mr Goldberg wishes to argue that Tarbuck is the wrong approach as a matter of law. He recognises, from our indications in case management before this hearing, that our likely position would be that we would follow Tarbuck without giving a reasoned judgment and that we would give permission, if he sought it, to go to the Court of Appeal. We know that the Court of Appeal has eschewed deciding this, in a judgment in Hay v Surrey County Council [2007] EWCA Civ 93, but it may well be that a vehicle arises for this. Mr Goldberg, somewhat flatteringly, said that it had been indicated by Buxton LJ in that case and in others that the reasoning of the EAT in any case is very important to it.
32. We feel that the division of judicial opinion is adequately set out in the judgment in Tarbuck and, if the judgments which we have just cited (NCH Scotland and Ferguson) are put before the Court of Appeal for comparison, then the issue will be decided if necessary. That may be unattractive, because if in fact a proper step was taken, then it does not matter that it was not considered or consulted upon. If a step was not taken which should have been, then consultation does not matter either. The real issue in this case is whether a step which was found to be a reasonable adjustment was taken. Thus, that ground of appeal will be allowed. The Tribunal, we hold, fell into error by following Mid-Staffordshire.
33. We further hold that the ground based upon the failure by the Tribunal to consider reasonableness is also made good by Mr Laddie, for the Tribunal certainly did not consider, and set out by matching paragraphs, how the issue under s18B(1) was dealt with, and for that reason, this matter will be remitted to it.
34. We turn then to the O'Hanlon point, based upon sick pay. The way in which this developed before the Tribunal appears to be related to the assertion that there was a disability and that the failure to continue paying sick pay was based upon the existence of an earlier failure to carry out a reasonable adjustment. We propose to cut through this matter by holding that the judgment of the EAT in O'Hanlon should have been followed in this case. Again, we are at pains to point out that the Employment Tribunal did not have the advantage of O'Hanlon before it, and relied upon Meikle v Nottinghamshire County Council [2004] IRLR 703 CA, which, as can be seen in O'Hanlon, has limited reach.
35. The simple issue is whether the application of a sick pay policy to everybody can be justified. We reject the argument by Mr Laddie that the burden of proof is relevant. An examination of the holding in O'Hanlon shows that the EAT was describing the circumstances relating to justification on the premise that there had been a discriminatory disadvantage in the running out of sick pay in the case of a disabled employee and so it naturally turned to seeking justification from the Respondent. In that case, evidence was led in respect of the cost of extending a scheme; so it was also in Fowler v London Borough of Waltham Forest (UKEAT/0116/06) in a judgment of HHJ Serota QC and members, 9 February 2007.
36. The legal approach, therefore, of the Tribunal - in the absence of O'Hanlon - is incorrect. We are of the opinion that the judgment itself cannot be said to be unarguably correct in the absence of a treatment by the Tribunal of O'Hanlon. We have heard some argument in relation to this, but our preliminary indication to Mr Laddie was that his submissions were likely to find favour, and they have, for we do not accept that the Respondent failed to adduce evidence of justification for its sick pay policy in this case. On the remission of this case, this point will play no further part and it is allowed.
37. We are, however, satisfied that those two errors of law we have identified cannot be read across so as to infect the other parts of the case, and to disentitle the Employment Tribunal from carrying on with its judgment.
38. This takes us to the cross-appeal, where there are two live issues, which are that the Tribunal failed to consider the Claimant's case that he would want to stay in the same section of the business, and that he should be permitted to start work at a later time. These appear to be live, and since the case is going back, we can ask the Tribunal to give its reasons on those two issues.
39. We have considered fully whether or not, in the state of the criticism of this Tribunal it should go back to the same one. The rules are set out in Sinclair Roche & Temperley v Heard [2004] IRLR 763. We bear in mind that certain findings by the Tribunal are not the subject of appeal by the Claimant. We also bear in mind the very substantial adoption by the Respondent of the findings by the Tribunal and the commendation given to them. The Tribunal has given considerable care to finding the facts. What it has not done is apply the law correctly. We have confidence in this Tribunal, with our direction, to apply the law correctly and to make findings, and to make findings different from the overall findings which it has made, if, in the light of our direction it considers that a different conclusion should be reached. It will not be bound to reach the same conclusion just with additional reasons, it will be bound to consider the law, as we have set it out, in order to now apply it to the findings of fact which it made, but to no others.
40. For that purpose, the appeal is allowed and there will be a remission to the same Employment Tribunal, unless the regional chairman for any reason finds this impracticable. It will be open to the Tribunal to accept submissions from both parties, and if the Tribunal so directs, to hear further evidence.
41. We would like to thank both the advocates and all involved in this very problematic case.
42. We will order that permission to appeal is given on the Tarbuck point, with an extension of time to 21 days after the judgment of the Employment Tribunal on remission, or further order made on application at any time to me. [Directions on ACAS conciliation not transcribed].