UK Social Security and Child Support Commissioners' Decisions

[2003] UKSSCSC CI_4940_2001 (29 January 2003)

 
PLH Commissioner's File: CI 4940/01

SOCIAL SECURITY ACTS 1992-1998

APPEAL FROM DECISION OF APPEAL TRIBUNAL

ON A QUESTION OF LAW

DECISION OF THE SOCIAL SECURITY COMMISSIONER

Claim for: Reduced Earnings Allowance

Appeal Tribunal: Norwich

Tribunal Case Ref: U/45/176/99/03351

Tribunal date: 3 September 2001

Reasons issued: 3 September 2001

1. This appeal by the Secretary of State must be allowed, as in my judgment the Norwich appeal tribunal which decided on 3 September 2001 that the claimant had been entitled to reduced earnings allowance from and including 27 August 1997 failed to give effect to the clear provisions of Schedule 7 Social Security Contributions and Benefits Act 1992. I set the tribunal's decision aside and substitute the only decision they could properly have given on the facts of the case before them, namely that the claimant was not entitled to reduced earnings allowance from 27 August 1997 because although there is no doubt she met the medical disablement conditions for that benefit from 1988 onwards, there had been a break in her entitlement for one or more days after 1 October 1990 which meant that she lost it for good: paragraph 11(2) of Schedule 7.
2. This case has had the most terrible procedural history at the tribunal, and my instinct like that of each tribunal panel before which it has come is to try and find some way of assisting the claimant to retain the benefit for which she originally qualified. However it is not of course open to a tribunal, or a Commissioner, to disregard the requirements of primary legislation passed by Parliament, whatever one may think of the fairness of the result in an individual case; and this I am afraid is another instance of the harsh consequences of the measures taken at the end of the 1980s to cut payments to disabled claimants under the industrial injuries scheme. As is well documented in other cases (R(I) 2/99, R(I) 2/00) many of the claimants worst affected were elderly and badly off, and it was widely considered unfair to remove an insurance benefit they depended on and had been given to understand would be theirs for life; but the measures to do this were nonetheless validly put through Parliament by the Government of the time, and a further separate policy decision to leave these benefit cuts unaltered was made by the present Government after it came into office.
3. The particular provision which stops the benefit continuing in this claimant's case is now in paragraph 11(2) Schedule 7 Social Security Contributions and Benefits Act 1992 cited above, by which:

"(2) A person –

(a) who immediately before [1 October 1990] is entitled to reduced earnings allowance in consequence of [a relevant accident or disease]; but

(b) who subsequently ceases to be entitled to that allowance for one or more days,

shall not again be entitled to reduced earnings allowance in consequence of that [accident or disease];"

In other words, as the Deputy Commissioner remarked in case CI 3237/00, whether the reason is the expiry of a disablement assessment or of an award without another one immediately following on from it, the consequence of a break in entitlement to reduced earnings allowance, even for a single day, is exactly the same: that entitlement can never be regained.

4. The claimant is a person who was entitled to reduced earnings allowance immediately before 1 October 1990 (the day on which the restricting provision first came into force in the Social Security Act 1990) in respect of a prescribed industrial disease, tenosynovitis in her right wrist. She has been finally medically assessed as suffering a permanent loss of faculty from 19 April 1998 for the remainder of her life from this condition, having developed it from the repetitive wrist movements required in her former occupation as a vegetable process worker topping and tailing onions for a seasonal employer in Norfolk.
5. The actual pattern of the claimant's work at this employment had been that she carried it out continuously from September to April and sometimes May in each year, depending on the season and the crop. However she was not employed at all for the rest of the year, when the employer no longer had any more onions to process. She liked working on this pattern for this particular employer, and did not attempt to find other employment during the summer months, in the food processing industry or otherwise.
6. Reduced earnings allowance, as the name implies, is a benefit that compensates people for the loss of earnings they suffer as the result of an industrial accident or disease. Under the provisions now in para 11(8)-(10) of Schedule 7 it may be awarded only for a limited period, or a succession of limited periods. For each such period a fresh claim has to be made, and for each period for which an award is made this is to be:

"…at a rate determined by reference to the beneficiary's probable standard of remuneration during the period for which it is granted in any employed earner's employments which are suitable in his case and which he is likely to be capable of following as compared with that in the relevant occupation …".

7. The consequence of that formulation of the benefit is that for a person to have any right to an allowance at all, it has to be shown that during the period for which a grant is claimed the probable earnings in his or her "relevant occupation" (i.e. the one that can no longer be followed because of the accident or disease) would have been greater than what the claimant is now able to earn after taking account of the disability. It must therefore follow that if because of conditions in a particular industry for any period, the probable level of earnings in the original occupation happens to drop below those in the alternative one, or falls away altogether, then for that period there can be no loss of earnings to be compensated, and thus no entitlement to the allowance.
8. For those who like this claimant had a "seasonal" pattern of work (not of course by any means uncommon in agriculture and related industries) in the original employment they had been engaged in before their accident or disease, the original system under the industrial injuries scheme was thus to give them repeat awards of reduced earnings allowance on an annual basis for those periods in each year when they would normally have been working and could show a loss of earnings; but no award for the off-season months when no loss existed, until the season came round again and they were able to make a fresh claim and demonstrate a fresh entitlement to an allowance. That was how this claimant's allowance was originally dealt with, from the time she made her first claim on 24 July 1989.
9. However after the Social Security Act 1990 including the provisions now in paragraph 11(2) of Schedule 7 had come into force the adjudication officer dealing with the renewal claim for 1991 determined that, as in keeping with the previous pattern there had been no award of reduced earnings allowance to the claimant for the summer months from 1 May to 3 September 1991, she now could not become entitled to any renewed award on the start of the new season from 4 September 1991,

"because throughout the period from 1 October 1990 up to 3 September 1991 there has not been continuous entitlement to the benefit":

see the two decisions of 25 April and 20 August 1991, the first refusing any award for the summer months and the second refusing any renewal award from September following the break caused by the first (pages 11-12).

10. The claimant appealed to the tribunal against the second of those decisions, understandably aggrieved against the stopping of her benefit on the seasonal pattern previously awarded and accepted. On 2 February 1993 a tribunal, understandably sympathetic to her case, upheld her appeal on the ground that despite the pattern they recorded of successive seasonal awards for the parts of each year from December 1988 when she would have been working, and disallowance of her claims for the "non-working" summer months in each year, "the break in payment does not prevent [her] from being entitled to claim" after September 1991: pages 18-20.
11. Less understandably, the department failed to appeal against that decision; and the pattern of repeated seasonal awards on each fresh claim, and disallowance of benefit for the summer months so that no award of reduced earnings allowance was made to the claimant for those months in each year, continued for a few more years: pages 37- 44.
12. Then in 1997 an adjudication officer made another attempt at stopping the claimant's continuing benefit, by issuing the decision of 7 July 1997 which eventually (after the four years the case spent going round in the tribunal system) has given rise to this appeal. That decision as recorded in the adjudication officer's submission to the appeal tribunal on page 21 was in two parts: the first determined that the claimant was not entitled to reduced earnings allowance from 30 April 1997 to 26 August 1997 inclusive "because she had no regular occupation at the date of the onset of the relevant prescribed disease". The second part determined that although she had been entitled to reduced earnings allowance on 30 September 1990, she was not entitled to it from and including 27 August 1997 "because throughout the period from 1.10.90 up to 30.03.97 there has not been continuous entitlement to benefit." Consequently her claim made on 30 March 1997 for a further award of reduced earnings allowance that year had been wholly disallowed.
13. The grounds relied on in the Secretary of State's submission to support this decision were that, after seeking legal advice regarding interpretation of the regulations and despite the earlier tribunal decision of 2 February 1993, it was now contended that for the period from 30 April or 26 August 1997 there was no entitlement to a reduced earnings allowance. This was not a case of a continuous underlying entitlement to benefit which for some reason was not payable to the claimant under the regulations (as for example happens when a person's benefit entitlement ceases to be payable to them while in hospital); and under paragraph 11(2) it had to follow that the break in entitlement was fatal to a further claim or award in respect of any later period.
14. The claimant's appeal against that decision of 7 July 1997 then became involved in what the tribunal chairman in the eventual decision of 3 September 2001 rightly describes as "an administrative merry-go-round", not helped by the Secretary of State's failure (or rather, refusal despite express request) to be represented at all before the tribunals trying to deal with the case. Two successive tribunals sat and determined the case, each time in favour of the claimant, on 18 October 1999 and 1 September 2000; but each of these considered and fully reasoned decisions was later set aside, by a different tribunal chairman sitting alone. The first did so for the procedural reason that the Secretary of State had not been notified of the hearing, a complaint that now looks pretty unmeritorious from a respondent deliberately absent from the two later rehearings.
15. The second tribunal decision in the claimant's favour was also set aside by another chairman acting alone: this time on an application by the Secretary of State for leave to appeal against it to a Commissioner on a point of law. Instead of determining that application, this chairman took it on himself to "set aside" the decision of the full tribunal on the ground that he considered it in error of law; though without it seems having given the claimant any warning that this was what he intended to do, or paying any regard to what the full tribunal had very reasonably said at the end of their statement of reasons issued on 29 September 2000 at page 57, that:

"We point out that this case has a long history and if either party is wishing to appeal, the sooner it comes for consideration before a Commissioner the better."

16. For another chairman in those circumstances to set aside the decision himself and cause the case to be relisted for yet another tribunal hearing was unhelpful to say the least, and arguably a quite perverse and improper use of the power in section 13(2) Social Security Act 1998. But the fact is that he did it, and no-one challenged him at the time; and no useful purpose would now be served in going back into all that, since a third full tribunal has sat and deliberated on the case, and delivered yet another decision in favour of the claimant, which is the one of 3 September 2001 under appeal to me.
17. By that decision, as recorded in the decision notice and statement of reasons issued on 3 September 2001 at pages 66 to 66D, the tribunal purported to hold that the claimant had had continuous entitlement to reduced earnings allowance throughout the period from 1 October 1990. It reached this conclusion, and its decision that she was entitled to an actual award of reduced earnings allowance on her claim of 30 April 1997 for the period from and including 27 August 1997 (sc. the start of the onion-packing season that year) by holding in effect that for a person in the claimant's position there remained a continuing underlying entitlement to reduced earnings allowance even for the "off-season" periods for which no awards of benefit had at any stage been made to her. It thus followed the reasoning of the 1993 tribunal that the absence of any right to reduced earnings allowance for the claimant for the summer months in each of the years from 1990 was what they referred to as a mere question of "payability" and did not break the continuity of an "underlying entitlement".
18. In my judgment, that was not a conclusion open to the tribunal to reach consistently with the requirements of paragraph 11 of Schedule 7. They were I think right in saying that the reason given by the Secretary of State on more than one occasion for not making the claimant any award on her successive claims for the "off-season" months in each year (namely that she "had no regular occupation during that season at the date of the onset of the relevant disease") was strictly incorrect: the true analysis is that at the date of onset (18 April 1988) she had a regular occupation all right, but as the tribunal rightly in my view held following case R(I) 56/53 it was as a seasonal process worker. As was expressly held by the Commissioner in that case, the reason such a worker cannot get a reduced earnings allowance (formerly a special hardship allowance) for the off-season months when they would not have been working anyway, is that those months are not a period when it can be said that there is any loss of earnings by reference to their "probable standard of remuneration" in that employment, such as to support any award of the allowance at all under what is now paragraph 11(10) of Schedule 7. The tribunal were in my view clearly wrong in holding that in the absence of any award, there could have been any entitlement to the benefit during such a period.
19. Although I reach this conclusion with reluctance in view of the harsh effects of paragraph 11(2) on the claimant and other seasonal workers in a similar position, there is in my judgment no room in the Schedule for the concept effectively relied on by the tribunal, of an underlying notional "nil rate entitlement" for those months for which no award was in fact made. It seems to me that the reality must be on the wording of the schedule that if for a period there is no award of reduced earnings allowance because there is no reduction in earnings during that period, then for that period there is no entitlement to a reduced earnings allowance. R(I) 56/53, which is a long-standing decision on the position of seasonal workers in this context, expressly addresses the question in terms of whether the claimant had an entitlement to benefit during the off-season months of the year (see paragraph 2 of the reported decision); and in my judgment it was binding on the tribunal on this point as well as on the nature of the claimant's employment. I regret that I do not follow the tribunal's reasons for finding themselves able to hold that there had been no break in the claimant's entitlement to reduced earnings allowance at any time since 1 October 1990 when as they expressly said in paragraph 9 of their statement of reasons they concluded that R(I) 56/53 still remained sound law and they could find no ground to distinguish it.
20. I have further considered whether there is any argument on discrimination either under European Union Law or under the Human Rights Act 1998 that could assist the claimant to sustain the tribunal's decision in her favour, but again have had to conclude that there is not.
21. So far as European Union law is concerned, there is no direct discrimination in the provisions of Schedule 11; and the argument for paragraph 11(2) having to be overridden by the direct effect of Council Directive 79/7/EEC on the equal treatment of men and women in matters of social security would have to depend on showing that the way paragraph 11(2) operates against seasonal workers bears disproportionately against women as compared with men, so as to give rise to indirect discrimination against the claimant on the ground of her sex which cannot be objectively justified. No evidence of such a disproportionate impact was produced to the tribunal, and none has been produced on behalf of the claimant before me. All that has been produced is a set of general figures submitted on behalf of the Secretary of State in the course of the present appeal from the Labour Force survey, showing the numbers of persons in temporary and seasonal employments of all kinds, which on their face do not appear to demonstrate any very substantial imbalance between the sexes in seasonal work. It does not seem to me on the basis of that material that I could hold paragraph 11(2) of Schedule 7 inapplicable to the claimant under the direct effect of the EU legislation.
22. Nor in my judgment is there any arguable ground for saying that the cut-off provision should be treated as overridden under the Human Rights Act 1998 on the ground that it unfairly discriminates against the claimant, either on the ground of her sex, or as one of a class of "seasonal workers" compared with other types of worker who continue to get the benefit on the basis of year-round earnings without any seasonal break in entitlement. Whatever arguments there might be for saying that the operation of the cut-off provision to prevent a renewed entitlement on a fresh claim could be equated with the "deprivation of a possession" under Article 1, Protocol 1 to the Convention scheduled to the Human Rights Act 1998, or may amount to discrimination contrary to Article 14 of the Convention, those are not maintainable either before the tribunal or before me, since the cut-off provision is contained in primary legislation of the United Kingdom Parliament and is not able to be construed in a way that prevents it applying to a person in this claimant's circumstances.
23. For those reasons, I must allow this appeal and I substitute the decision I am satisfied the tribunal ought to have given on the facts found and the evidence before them: namely that the claimant having had a break in her entitlement to reduced earnings allowance for one or more days after 1 October 1990, she was not entitled to any fresh award of the allowance for any period from 30 April 1997 onwards on the further claim she made on that date.

(Signed)

P L Howell

Commissioner

29 January 2003