Upper Tribunal (Administrative Appeals Chamber)

LE [2009] UKUT 166 (AAC) (24 August 2009)
Jobseekers allowance
other

 


IN THE UPPER TRIBUNAL Appeal No. CJSA/1807/2008

ADMINISTRATIVE APPEALS CHAMBER

Before S J Pacey Judge of the Upper Tribunal

Decision: The decision of the appeal tribunal held on 2 November 2007 is erroneous in point of law. I set aside that decision. I re-make that decision pursuant to s.12(2) of the Tribunals, Courts and Enforcement Act 2007. The claimant is not entitled to contribution based Jobseeker's Allowance in respect of the claim made on 23 November 2007.

REASONS FOR DECISION

1. This is an appeal by the claimant, brought by my leave (as it was then termed) and is against the decision of the appeal tribunal held on 2 November 2007. By virtue of the Tribunals, Courts and Enforcement Act 2007 and paragraph 2 of Schedule 4 to the Transfer of Tribunal Functions Order 2008 the appeal continues on and after 3 November 2008 as proceedings before the Upper Tribunal. That, however, makes no substantive difference to my decision.
2. I held an oral hearing of the appeal. The claimant attended that hearing and was represented by Mr J Coppel, of Counsel, instructed by the Free Representation Unit, and the Secretary of State was represented by Mr R Palmer, of Counsel, instructed by the Solicitor to the Department. I am grateful to the parties for their written and oral submissions.
3. A claim to contribution based jobseeker's allowance ("JSA") was made on 23 November 2007. The decision maker decided that the claim could not be backdated, as the claimant requested, for the period from 24 November 2006 to 22 January 2007. The claimant did not pursue her initial appeal against that decision and it was not an issue before the tribunal or before me. The decision maker also decided, however, that the claimant was not entitled to contribution based JSA because she had not paid sufficient national insurance contributions in the tax year 2005/2006.
4. Section 1(2) of the Jobseekers Act 1995 provides that a person shall be entitled to JSA if he or she satisfies various conditions one of which, under section 1(2)(d), relates to the satisfaction of contribution conditions as set out in section 2. Section 2(1)(a) provides that the claimant has actually to have paid Class 1 contributions in respect of one ("the base year") of the last two complete years before the beginning of the relevant benefit year and satisfies the additional conditions in sub-section (2). Section 2(1)(b) provides that the claimant also, in respect of the last two complete years before the beginning of the relevant year, has either to have paid or been credited with Class 1 contributions. It is not disputed that the claimant had paid sufficient Class 1 contributions in the tax year 2004/5. She therefore satisfied the first contribution condition. It is also not disputed that the claimant had not paid sufficient contributions in the 2005/2006 tax year and that she did not, therefore, satisfy the second contribution condition. The claimant appealed to the tribunal. The claimant said that she had not satisfied the second contribution condition because she had not at the material time worked because of child care responsibilities, and she argued that the decision the subject of the appeal had discriminatory effect, since most carers were female.
5. The claimant helpfully provided a written submission to the tribunal. She amplified her grounds of appeal, pointing out that it was anomalous that her home responsibilities protection for the tax year 2005/2006 counted towards pension entitlement but not towards contributions for JSA purposes. The claimant was referring to the Social Security Pensions (Home Responsibilities) Regulations 1994 which, in summary, provides assistance in satisfying the second contribution condition in relation to a range of benefits including category A or B retirement pension. The claimant maintained that the provisions of section 2 of the Jobseekers Act were discriminatory in not enabling HRP to count towards satisfaction of the second contribution condition. The claimant maintained that section 2 disproportionately disadvantaged more women than men and, as a result, that there was indirect discrimination contrary to Article 14 of the European Convention on Human Rights. The claimant also argued said that there was discrimination contrary to Article 4 of Council Directive 79/7/EEC.
6. The tribunal dismissed the appeal. After briefly reciting the undisputed contribution record of the claimant the tribunal went on to say that:

"[The claimant] agreed that she had taken time off from work because she had a family. The PO explained that this meant she would get national insurance credits for home responsibility protection. This would mean she would not be prejudiced in respect of her retirement pension in the future, but was not sufficient to entitle her to JSA. The regulations dealing with this had been set out in the written submission that both the tribunal and the appellant had received in advance of the hearing.

I was satisfied that these regulations had been applied correctly in this case and had to confirm the decision."

7. The grounds of appeal as originally formulated were that "… the law governing home responsibilities protection breaches the Human Rights Act 1998, in that it constitutes indirect discrimination on the basis of sex contrary to Article 14 in conjunction with Article 1 Protocol 1 and Article 8 of the European Convention on Human Rights pursuant to the Human Rights Act 1998. In the alternative, it is argued that the statutory scheme violates Directive 79/7/EEC".
8. The difficulty with the above argument is that although a decision on home responsibilities protection can be appealed (Schedule 3, Social Security Act 1998) it can only arise within the context of determining the contribution conditions for the benefits set out in paragraph 5 of Schedule 3 to the Social Security Contributions and Benefits Act 1992. There was, in fact, no decision on a home responsibilities protection claim neither did the calculation of contributions under section 2 of the Jobseekers Act impose a requirement on the Secretary of State to consider the claimant's HRP status for the tax year 2005/2006. Issues as to whether HRP has any discriminatory effect do not fall for consideration in the course of this appeal. In granting leave to appeal, however, I questioned whether the relevant contribution conditions were discriminatory under EU or ECHR provisions.
9. The initial submission provided on behalf of the Secretary of State conceded that the tribunal erred in law in failing to address the arguments about unlawful sex discrimination contrary both to the Human Rights Act 1998 and Article 4 of Directive 79/7. That to my mind is manifestly correct, as was conceded by Mr Palmer. I must, then, set aside the decision of the tribunal. The parties were agreed that I should remake the decision of the tribunal (to use the parlance of section 12(2) of the Tribunals, Courts and Enforcement Act 2007) since there is no dispute as to the facts, only as to matters of law.
10. The initial grounds of appeal were effectively recast by Mr Coppel, who referred to regulation 48 of the Jobseeker's Allowance Regulations 1996. The requirement for contributions to have been paid or credited in respect of relevant years (section 2 of the Jobseekers Act) can be ameliorated by "linked periods", provided for by section 2(4)(b). The linking periods are defined in regulation 48(2) of the JSA Regulations. Under regulation 48(2) carers, those incapable of work and those entitled to a maternity allowance can be included within "linked periods" but, significantly the claimant argues, regulation 48 does not include a linking rule for women caring for children, as part of normal child care responsibilities, like the claimant. This, it is argued, has the effect that regulation 48 was not validly made because it did not go far enough towards protecting the position of those, like the claimant, with child care responsibilities. The claimant develops this argument by alleging discrimination under Article 1 of the First Protocol to the European Convention, read with Article 14 and Directive 79/7.
11. It is not disputed that contribution based JSA falls within the subject matter of Article 1, Protocol 1 and so can be read with Article 14 in order to consider whether the latter has been breached. Article 14, of course, has no independent application, being limited to secure the "enjoyment of the rights and freedoms set forth in this Convention". Following R(RJM) v. Secretary of State for Work and Pensions [2008] UKHL 63 it is clear that a claim to a contributory benefit falls within the ambit of Article 1, Protocol 1 and, thus, Article 14 must be considered. It provides for the enjoyment of the rights and freedoms set forth in the Convention without discrimination on any ground including sex.
12. Mr Coppel argued that regulation 48 had discriminatory effect in that it has disproportionate impact upon women, since more women take time off work to look after children than do men. Mr Palmer's argument was that the condition (to have made a sufficient level of contributions in each of the relevant tax years) that the claimant was required to meet was not one she was prevented from meeting by the fact that she was a woman and I remind myself that R(JSA) 4/02 indicates that a key distinction between whether a difference in treatment arises from mere choice, as opposed to indirect discrimination, is whether a person can objectively be said to belong to a group which is adversely affected by a particular provision. Mr Palmer argued that it was not clear why the "group" for comparison should include parents who had taken a career break for the purposes of child care given that voluntary breaks in employment might be taken for any number of reasons. The absence of a particular category in regulation 48(2) was, he argued, not determinative and that Mr Coppel's focus on a narrowly defined subset was not justified. Furthermore Mr Palmer drew attention to the lack of statistical evidence to support the claimant's complaint of discrimination.
13. I see the attraction of Mr Palmer's argument. It is not disputed that the claimant had a voluntary career break and it may be permissible to draw a distinction between those who were unable to comply with the contribution requirement and those unwilling to comply. An analogy may be drawn with the 38 week period of payment of statutory maternity pay, that period being a period of absence by reason of maternity, beyond which any absence would be a matter of choice. The categories of those covered under regulation 48 include those in the initial period of maternity and those who are unable to work through sickness or disability.
14. Mr Palmer sought to distinguish two cases relied upon by Mr Coppel, Schonheit [2004] IRLI 983 and Ministry of Defence v. Armstrong [2004] IRLI as they related to different factual situations and concerned the principle of equal pay. Those cases concerned part-time workers. Although each person in a group of part-time workers might make an individual practical choice about working shorter hours (for example so that they can pick up children from school, cook for the family or carry out child care), these choices are distinct from the social fact represented by the cumulative statistical and demographic picture that emerges. If that social fact demonstrates that a group (for example women) are statistically more likely not to meet the relevant conditions those conditions will be discriminatory regardless of the individual motivations of each person. That to my mind is the essence of the reasoning in the "part-time" workers cases relied upon by the claimant, including Schonheit and Armstrong. It is clear that the claimant made a decision to remain at home after the birth of her child for a period which took her beyond the statutory maternity scheme and into a benefit year which did not allow her to rely on her contributions for JSA purposes. Her individual choice, however, can be subsumed within the larger demographic picture if it can be shown that a significantly greater number of women than men take periods of time out of employment to care for children, so that they fail to meet the contribution rule in section 2 of the Jobseekers Act. The absence of statistical evidence is not to my mind determinative if the separate demographic groups and the differential treatment thus arising are accepted as existing.
15. I take the view that it is within judicial knowledge that women are more likely to take a career break than men, perhaps particularly when children are under the age of 5 (as in this case) and I remind myself that a similar view was taken by the Deputy Commissioner (as he then was) in CP/4017/2006. In my view it is more likely that more women than men will be unable to satisfy the contribution requirement in section 2 of the JSA. Focusing upon the element of choice alone would not provide a full answer, particularly bearing in mind that choice may be a reflection of general societal patterns, for example that women have a particular role in bringing up children see, for example, the opinion of the Advocate General in Enderby v. Frenchay Health Authority and Another [1993] IRLR 591, quoted with approval in Armstrong. I have not forgotten that in R(JSA) 4/02 the Commissioner (as he then was) considered to be determinative the claimant's individual choice. That case, however, to my mind depended upon its own rather unusual facts, such that it was impossible to identify a group to which the claimant belonged in relation to the provision at issue and thus to show any objective difference in treatment. The decision that it was a matter of "choice" for the claimant as to how many hours she was available for was a conclusion from that reasoning. In my judgment, then, the claimant is able to demonstrate indirect discrimination as a result of the legislative provisions in issue.
16. That raises the question of whether any discrimination that arises is justified. I remind myself that sex is one of the "suspect grounds" which requires weighty reasons for justification, see R v. Carson [2005] UKHL 37. Any discrimination has to be founded upon objective and reasonable justification, assessed in relation to the aim and effects of the measure under consideration and there has to be a reasonable relationship of proportionality between the means employed and the aims sought to be realised, see Belgian Linguistics (No. 2) 1979-80 (1 EHRR 252). It is to be remembered also that in Stec v. United Kingdom [2005] 41 EHRR SE 295 the European Court of Human Rights said that "the contracting State enjoys a margin of appreciation in assessing whether and to what extent differences in otherwise similar situations justify a different treatment". Mr Palmer argued that JSA was a benefit designed to assist the unemployed and was not primarily designed to protect those who voluntarily gave up their employment, for whatever reason. Moreover, all the categories referred to in regulation 48(2) are subject to the rider in 48(2A) which, in his submission, meant that there was a requirement for "recentness" which should, then, provide the focus for looking at the periods in 48(2). All the categories in 48(2) effectively recognise that there was no real choice for the people in those categories about giving up work and the question of where to draw the line was a matter for legislative choice.
17. The open-ended linking period in regulation 48(2) effectively recognises that those who are carers or incapable of work could be out of the labour market for some considerable time and this is, then, inconsistent with the requirement of "recentness" which Mr Palmer sought to introduce into regulation 48. Although regulation 48(2A) imposes a requirement that those who fall within 48(2) have to come within a jobseeking period (or further linking period) within 12 weeks of the linking period which applies to them coming to an end, regulation 48(2A) has no bearing on how long the linking period itself might be, only on how long after it has finished the claimant might rely upon it.
18. The House of Lords recently summarised the requirements of proportionality in AS (Somalia) (FC) and Another (FC) v. SSHD [2009] UK HL 32 in which their Lordships quoted with approval what Lord Bingham had said in R(SB) v. Governors of Denbigh High School [2006] UKHL 15: "… the limitation or interference must be directed to a legitimate purpose and must be proportionate in scope and effect." It is trite that the burden of showing justification rests upon the Secretary of State. JSA is a benefit designed to assist the unemployed. It is important to bear in mind in this appeal that the claimant voluntarily gave up her employment. All the categories in regulation 48(2) effectively recognise, however, that there was no real choice for the people in those categories about giving up work. Thus, for example, provision is made for those incapable or treated as incapable of work and those whose caring responsibilities are so onerous as to justify entitlement to a carer's allowance. The whole tenor of the categories in regulation 48(2) to my mind is inconsistent with any reasonable element of choice which is, however, present in those who give up work for the purposes of child care. This has the effect of drawing a bright line between those who fall within regulation 48(2) and those, like the claimant, who voluntarily give up work. A line has been drawn and the cut-off point, in my judgment, is a matter of legislative choice. Parliament has recognised that an additional period may be necessary to reflect child care responsibilities (regulation 48(2)(c) providing for linking in respect of a maternity allowance) and the drawing of the line to my mind demonstrates a reasonable relationship of proportionality between the legitimate aim sought to be employed in distinguishing between those who have no real choice about giving up work and those who have a very real element of choice. The criteria in regulation 48(2) are strongly defined and clearly delineated. The discrimination in my judgment clearly has a rational basis, relating to social and economic policy, and that is a matter for Parliament. Moreover, there are other benefits which may be available to those with child care responsibilities, for example child tax credit and working tax credit. Any discrimination is, then, in my judgment justified.
19. Even absent the justification, that would leave the question of what remedy is appropriate. I am invited on behalf of the claimant to give "a declaration that regulation 48 was invalidly made …" This is presumably a reference to the powers arising under section 3(1)(c) of the Human Rights Act 1998. Mr Coppel argues that regulation 48 should be "levelled", by extending the protection to include those with child care responsibilities. Mr Palmer, in contrast, argues that if regulation 48 is found to be unlawfully discriminatory then it would fall to be disapplied altogether but that would produce no benefit to the claimant who would still be unable to meet the requirements of section 2 of the Jobseekers Act.
20. The primary source of the discrimination is, however, section 2 of the Jobseekers Act. It cannot be read in the way contended for on behalf of the claimant. Any discriminatory effect could have been removed under regulation 48 but that regulation is not to my mind ultra vires simply because it has not done so. Disapplying regulation 48 would not remove the discrimination complained of. Notwithstanding that it does not provide a linking period that would otherwise assist her it is not regulation 48 which prevents the claimant being paid JSA and without regulation 48 the claimant would have to rely on the Jobseekers Act itself. That would not in any way assist her because it contains only the rules she cannot meet. The provisions in section 2 are clear and unambiguous. They unarguably exclude the claimant from entitlement and cannot be read down in a manner compatible with her ECHR rights. Similarly, in my judgment, none of the references to linked periods in section 2(4)(b), 35(2) and Schedule 1, paragraph 3(b) can be read down as providing any particular rule which can be construed in the claimant's favour since those provisions simply provide the framework by which regulations could be introduced if the Secretary of State were so minded.
21. Regulation 48 cannot be read down so as to assist the claimant. It is not, to my mind, permissible to write in a provision benefitting a woman who has taken time out of employment for child care. Section 3(1)(c) of the Human Rights Act does not extend to writing in a provision, even in secondary legislation, which is not there. Notwithstanding that the power to prescribe a relevant category under regulation 48 exists to read such a category into that regulation would be contrary to the clear exclusionary meaning of section 2 of the Jobseekers Act and would result in a positive legislative change crossing the boundary between interpretation and amendment of a statute, see para 121 Ghaidan v. Godin Mendoza [2004] UKHL 30. I remind myself also that in R(P) 1/08 the Commissioner, referring to R v. Lambert [2001] UK HL 37 noted that resort to section 3 of the Human Rights Act would not be possible if the legislation contained provisions which expressly contradicted the meaning which the enactment would have to be given to make it Convention compatible.
22. The claimant's representative submits that "… just satisfaction in [the claimant's] case requires … an order that the jobseeker's allowance for which she has applied is payable". The implication is that relief can be given without a statutory basis. No such power exists either in the provisions governing jobseeker's allowance, the Tribunals, Courts and Enforcement Act 1997 or the Upper Tribunal Rules, a similar view being expressed in CIS/1132/2006, paragraph 23.
23. There is, then, no remedy I am able to provide. The claimant, however, also relies upon Council Directive 79/7/EEC which, Article 1, provides for the principle of equal treatment for men and women in matters of social security and, Article 2, applies to the "working population". Article 3 provides that the Directive shall apply to specified statutory schemes. There is no dispute that the claimant falls within Article 2 and that JSA is a scheme within Article 3. Mr Coppel argues that the claimant has been discriminated against on the ground of sex, contrary to Article 4. The arguments of both parties in relation to the discrimination issue are substantially the same in relation to Human Rights Law as they are to European Union Law. I have addressed the discrimination issue above.
24. Mr Palmer argues that the respondent is entitled to rely upon the derogation in Article 7(1)(b), allowing Member States to exclude from the scope of the Directive "… the acquisition of benefit entitlements following periods of interruption of employment due to the bringing up of children." Article 7(2) provides that "Member States shall periodically examine matters excluded under paragraph 1 in order to ascertain, in the light of social developments in the matter concerned, whether there is justification for maintaining the exclusions concerned." Mr Coppel argues that the respondent has not complied with the requirement for periodical review and (Francovich [1991] ECR I - 357) the respondent has failed to fulfil a minimum standard which can be derived from what he says is a requirement for a periodical review. Mr Coppel argues that the derogation is to preserve temporarily certain advantages afforded to women in order to remedy past inequalities and that the discrimination complained of against women with childcare responsibilities, is not objectively and necessarily linked to those responsibilities.
25. I remind myself, however, that the derogations in Article 7 are capable of working against women as well as in their favour. See, for example, Hepple v. Adjudication Officer [2000] ECR I - 3701 in which women suffered a cut from reduced earnings allowance to retirement allowance at age 60, as opposed to 65. To my mind the claimant cannot escape the effect of the plain wording of Article 7(1)(b). Article 7(1)(b) is clearly directed to just such disadvantages as are in issue in this appeal, that is to say relating to loss of benefit entitlement arising from a break in employment because of looking after children. Article 7(1)(b) specifically leaves it to individual Member States to decide the degree to which the different position of men and women regarding the effects of child care and employment could be ameliorated. Any comparison with Article 7(1)(a) is unhelpful since although that contains a simple rule for the purpose of pensionable ages the further "… possible consequences … for other benefits …" inescapably require a more complex working out on a benefit by benefit basis as is apparent from the different decisions in Thomas v. Secretary of State for Social Security [1993] ECR I - 1247) (concerning severe disablement allowance and invalid care allowance) and Secretary of State for Social Security v. Graham [1995] ECR I - 2521 (concerning invalidity benefit) and Hepple, which concerned reduced earnings allowance.
26. Article 7(2) clearly envisages that from time to time Member States would consider whether there was equality as between the sexes in terms of work and bringing up children and whether the privileged treatment of women did not need to be continued (… "in the light of social developments in the matter concerned"). Although there is no evidence that Article 7(1)(b) has been re-examined in my view this Article is neither "sufficiently clear and precise" nor "unconditional" in its terms and is therefore not directly effective. The absence of any re-examination of the position is not to my mind determinative. Even if, as the claimant maintains, women are still disadvantaged regarding work and child care in the United Kingdom there appears no basis for reviewing and removing the derogation. The basis for Article 7(1)(b) would nonetheless remain, together with its broad effect. The claimant is not assisted by Francovich [1991] since that case concerned a failure by a Member State to establish a mechanism to implement a Directive. Damages were awarded for the failure but that case presupposed that the Directive in issue gave rise to enforceable rights which in my judgment do not arise under Article 7(2). This cannot, then, be used as an aid to interpret the scope of the derogation in Article 7(1)(b). In summary the claimant cannot, in my judgment rely upon Directive 79/7 to show discrimination under EEC Law.

(Signed on the Original)

S J Pacey

Judge of the Upper Tribunal

(Date) 24 August 2009