Upper Tribunal (Administrative Appeals Chamber)

Decision of the Upper Tribunal
(Administrative Appeals Chamber)

As the decision of the First-tier Tribunal (made on 21 March 2013 at Cardiff under reference SC188/11/09010) involved the making of an error in point of law, it is SET ASIDE under section 12(2)(a) and (b)(i) of the Tribunals, Courts and Enforcement Act 2007 and the case is REMITTED to the tribunal for rehearing by a differently constituted panel.

DIRECTIONS:

A.        The tribunal must undertake a complete reconsideration of the issues that are raised by the appeal and, subject to the tribunal’s discretion under section 12(8)(a) of the Social Security Act 1998, any other issues that merit consideration.

B.        The tribunal must investigate and decide the claimant’s entitlement to employment and support allowance on and from 14 October 2011 and, in particular, whether he has limited capability for work-related activity.

C.        In doing so, the tribunal must not take account of circumstances that were not obtaining at that time: see section 12(8)(b) of the Social Security Act 1998. Later evidence is admissible, provided that it relates to the time of the decision: R(DLA) 2 and 3/01. It will be particularly important in this case to concentrate on the right time, as there is evidence that the claimant’s condition worsened from early 2012 (see the GP’s letter at page 104).

D.        The claimant has a further appeal before the First-tier Tribunal against the later decision that he no longer has limited capability for work. That appeal has been stayed to await my decision on this appeal. The district judge will need to consider whether the two appeals should be heard by the same panel.

Reasons for Decision

A.        The issue

1.         This is another case that demonstrates the structural and practical problems that arise when regulation 35(2) of the Employment and Support Allowance Regulations 2008 (SI No 794) has to be applied in the appellate forum. The particular issue raised is: how does regulation 35(2) apply if the claimant could never work again or if there is no work-related activity that could (reasonably) be required of him?

B.        History and background

The award of employment and support allowance

2.         The claimant was born on 14 November 1954. He was awarded an employment and support allowance from and including 16 May 2011. He had experienced problems with cardiac arrhythmia, which was diagnosed as Brugada Syndrome. According to the NHS website:

Brugada syndrome is an uncommon but serious heart condition. It can cause fainting and episodes of an abnormally rapid heart rhythm, called arrhythmia. This happens because the electrical activity of the heart is disrupted – a problem that is usually inherited. Not everyone with Brugada syndrome will experience arrhythmia, when it does happen, it can be fatal.

Not surprisingly, the claimant was, and remains, concerned about the risk that this condition poses. He was given an implantable cardioversion defibrillator. He is anxious lest this malfunctions or its operation is affected by solenoids which are common in public buildings.

The assessment of capability for work

3.         The claimant’s capability for work was assessed later in 2011. He completed a questionnaire, which explained both his Brugada Syndrome and his arthritis. In the physical functions section of the form, he indicated problems with mobilising, standing and sitting, and reaching. In the mental, intellectual and cognitive functions section, he indicated problems with awareness of hazard or danger, initiating actions, coping with social situations, and behaving appropriately with other people. He was subsequently interviewed and examined by a health care professional who gave her opinion that he had no disability relevant to employment and support allowance. This led to the decision of the Secretary of State that the claimant was no longer entitled to an employment and support allowance from and including 14 October 2011.

The appeal to the First-tier Tribunal

4.         The claimant exercised his right of appeal. At that stage, he was not represented. There was in evidence a letter from the claimant’s GP dated 1 April 2011, written to the claimant’s employer. The doctor set out the medical history and the problems the claimant had encountered when he tried to return work, saying:

It was very clear to me that he could not return to that situation as the stress was proving detrimental to his recovery and long term health.

That sentence, by its content and context, must relate to the actual work the claimant had been doing. The same cannot be said of this later sentence:

In answer to question 7, I do not really see him returning to employment, either under conditions of normal duties or otherwise.

That is capable of being read as a general statement that the claimant would not be able to return to any form of work. Whether it does mean that depends on the terms of question 7, which were not in evidence. It may be possible to remedy this omission at the rehearing.

5.         The First-tier Tribunal allowed the appeal to the extent of finding that regulation 29(2)(b) of the Employment and Support Allowance Regulations 2008 applied. The tribunal did not place the claimant in the support group for persons having limited capability for work-related activity. In the tribunal’s written reasons, the presiding judge explained why the claimant had not scored any points for the activities listed in Schedule 2 to the Regulations. On regulation 29, the judge explained:

… there would be a substantial risk to [the claimant’s] physical health if he were found fit even for a wider range of jobs of which he would be capable because working more closely with equipment gives rise to added risk to his heart due to the risk of interference with his heartbeat and also because [he] gets short of breath with exertion and stress.

This reasoning did not apply to regulation 35, which applies to the support group:

… because we found that the level of activity which [he] enjoys in everyday life would be no greater if required to attend work focused interviews. [He] can and does go out, including to shops and appointments and to places that make him anxious, ie to places that have equipment, which he says could interfere with his defibrillator such as shops.

There is not an increased or substantial risk in the minimum level of activity required by the Secretary of State, whether through phone calls, form filling or attending appointments with them. [The claimant] is not entitled to the support component.

What happened later

6.         I need to mention two subsequent events.

7.         After the tribunal’s decision, the claimant was interviewed. He has given an account of what was said, which I do not think can be taken literally. It is understandable that he was not attuned to the technical language being used and its significance. I take his account as saying that the adviser said that there was no activity that could be required of him given his health. It may be possible to provide an accurate statement from the Department’s records for the rehearing. Whatever the advice given, it may be relevant under section 12(8)(b) of the Social Security Act 1998 as indicating the claimant’s condition at the date of the decision under appeal (R(DLA) 2 and 3/01). I say may be because there is evidence that the claimant’s condition worsened shortly after the Secretary of State’s decision (page 104).

8.         In April 2013, there was a further assessment of the claimant’s capability for work, following which the Secretary of State superseded the tribunal’s decision. The claimant has exercised his right of appeal against that decision, but it has not yet been decided.

The appeal to the Upper Tribunal

9.         The claimant applied for permission to appeal. Upper Tribunal Judge Powell, who has now retired, directed the Secretary of State to make a submission on the application. The Secretary of State’s representative did not support the appeal. Judge Powell then directed an oral hearing of the application. The application was listed for hearing before me on 3 May 2013. Having considered the papers, I gave permission without the need for a hearing, saying:

4. The case raises in stark form the scope of regulation 35 in circumstances where there is no work that the claimant could do. Is that sufficient to satisfy regulation 35?

5. What is the legal position in such a case? Are Schedule 3 and regulation 35 merely a test of a level of disability at which claimants receive a higher rate of payment and remain entitled to contribution-based employment and support allowance for longer than a year? Or are they intended to catch all those who realistically could not work, even if they do not satisfy Schedule 2 or regulation 29?

6. Regulation 35 does seem to assume that there is some work-related activity that a claimant could undertake. Is there any provision to cover the possibility that there is none?

10.      The Secretary of State’s representative did not support the appeal. I directed an oral hearing of the appeal, which took place before me on 26 March 2014. The claimant had the good fortune to be represented by Robert Jones, formerly a solicitor in private practice with a vast experience in social security law and now a volunteer in the office of Julie Morgan AM. The Secretary of State was equally fortunate to be represented at this stage by Sarah Wilkinson of counsel. I am grateful to both of them for their written and oral arguments and for a fascinating hearing. I have only made some passing references to their arguments. It is not that they were unhelpful, quite the opposite. It is, rather, that my reasoning differs from both, although it has been formed through the process of considering why neither set of arguments was of itself sufficient to resolve the issues in this case.

C.        The legislation

The structure of employment and support allowance

11.      Employment and support allowance is governed by the Welfare Reform Act 2007, the Employment and Support Allowance Regulations 2008 (SI No 794) and Employment and Support Allowance (Work-Related Activity) Regulations 2011 (SI No 1349). All references to sections are to the 2007 Act and all references to regulations are to the 2008 Regulations unless otherwise stated.

12.      Entitlement is initially based on a doctor’s fit note (regulation 30). After this initial assessment phase, the claimant may continue to qualify on the basis of limited capability for work. Broadly, this can be shown in three ways. The first way is on account of the nature and extent of the claimant’s disabilities, demonstrated by scoring at least 15 points for the activities in Schedule 2 to the Regulations (regulation 19). The second is on account of the nature of the claimant’s condition or treatment. For example, the claimant may be terminally ill or receiving chemotherapy (regulation 20). The third is on account of the risk that would be posed if the claimant were to undertake work. This is regulation 29, which at the relevant time provided:

29 Exceptional circumstances

…

(2) This paragraph applies if—

…

(b) the claimant suffers from some specific disease or bodily or mental disablement and, by reasons of such disease or disablement, there would be a substantial risk to the mental or physical health of any person if the claimant were found not to have limited capability for work.

13.      A claimant who has limited capability for work may qualify for a higher payment and be exempt from undertaking work-related activity by coming within the support group. This can be shown in two ways. The first way is on account of the nature and extent of the claimant’s disabilities, demonstrated by satisfying at least one of the activities in Schedule 3 to the Regulations (regulation 34). Most of these are the highest scoring descriptors from Schedule 2. The second is on account of the risk that would be posed if the claimant were to undertake work-related activity. This is regulation 35, which is authorised by paragraph 9 of Schedule 2 to the 2007 Act:

Limited capability for work-related activity

9-Regulations may make provision-

(a) for a person to be treated in prescribed circumstances as having, or as not having, limited capability for work-related activity; …

Regulation 35 provides:

35 Certain claimants to be treated as having limited capability for work-related activity

…

(2) A claimant who does not have limited capability for work-related activity as determined in accordance with regulation 34(1) is to be treated as having limited capability for work-related activity if—

(a) the claimant suffers from some specific disease or bodily or mental disablement; and

(b) by reasons of such disease or disablement, there would be a substantial risk to the mental or physical health of any person if the claimant were found not to have limited capability for work-related activity.

Work-related activity

14.      Section 2(5) provides:

(5) For the purposes of this Part, a person has limited capability for work-related activity if—

(a) his capability for work-related activity is limited by his physical or mental condition, and

(b) the limitation is such that it is not reasonable to require him to undertake such activity.

15.      Section 13 provides:

Work-related activity

…

(7) In this Part, ‘work-related activity’, in relation to a person, means activity which makes it more likely that the person will obtain or remain in work or be able to do so.

(8) The reference to activity in subsection 7 includes work experience or a work placement.

Subsection (8) was not in force at the relevant time.

16.      The 2011 Regulations make further provision:

3 Requirement to undertake work-related activityE+W+S

(1)  The Secretary of State may require a person who satisfies the requirements in paragraph (2) to undertake work-related activity as a condition of continuing to be entitled to the full amount of employment and support allowance payable to that person.

…

(4) A requirement imposed under paragraph (1)—

(a) must be reasonable in the view of the Secretary of State, having regard to the person's circumstances; and

(b) may not require the person to—

(i) apply for a job or undertake work, whether as an employee or otherwise; or

(ii) undergo medical treatment.

D.       How the tribunal went wrong in law

17.      I can deal with this issue briefly. I accept Mr Jones’ argument that the tribunal failed to take sufficient account of the claimant’s mental health. He does, of course, have physical problems. However, his reaction to his condition and to the operation of his defibrillator has caused considerable stress that has, in some ways, proved more disabling that the condition itself. The tribunal did not show by its reasoning that it had considered this aspect of the case fully and its actual reasoning seems to have concentrated on what he could do physically rather than the mental effects. That is certainly true of the tribunal’s approach to regulation 29, which I have quoted in paragraph 5.

E.        Analysis of regulation 35(2)

18.      As there will be a rehearing, I have to direct the tribunal on the significance of the evidence that (i) there may be no work that the claimant could do and (ii) there may be no work-related activity that could realistically be identified for the claimant. As I have said, the evidence on both those points is not entirely clear. The tribunal at the rehearing will have to consider that evidence, together with any other evidence produced, and make its own assessment.

Charlton

19.      If regulation 35(2) were read literally, it would only apply if the risk arose from the very act of finding the claimant not to have limited capability for work-related activity. That might happen occasionally, but it would render the provision largely ineffective. The same problem arises with regulation 29(2)(b) and its predecessor, regulation 27 of the Social Security (Incapacity for Work) (General) Regulations 1995. The Court of Appeal dealt with this issue in respect of regulation 27 in Charlton v Secretary of State for Work and Pensions reported as R(IB) 2/09. The court decided that the regulation had a wider scope:

45. … The decision-maker must assess the range or type of work which a claimant is capable of performing sufficiently to assess the risk to health either to himself or to others.

This was the approach that Mr deputy Commissioner Paines had been taking. The Court considered my approach, which had been to direct tribunals to consider the work that would be defined in a jobseeker's agreement if the claimant were to apply for a jobseeker's allowance. The Court rejected this, saying:

43. … There is no warrant within the wording or context of regulation 27(b) for requiring a decision-maker to embark upon the almost impossible task of imagining what hypothetical agreement might have been made should the claimant have applied for a jobseeker's allowance.

20.      Although the Court was dealing with regulation 27, it was aware of the employment and support allowance legislation and said:

4. Employment and support allowance has replaced incapacity benefit for new claimants. The previous scheme is the one which is relevant to this appeal but the question of interpretation remains relevant to the regulations made under the new scheme introduced by the Welfare Reform Act 2007.

The court clearly had regulation 29 in mind. It is not clear whether it considered regulation 35, but I dealt with that in AH v Secretary of State for Work and Pensions [2013] UKUT 118 (AAC). I decided that the approach in Charlton had to be modified to read:

The decision-maker must assess the range or type of work-related activity which a claimant is capable of performing and might be expected to undertake sufficiently to assess the risk to health either to himself or to others.

21.      This has produced problems at the appeal stage, because work-related activity involves two discretions: (i) the Secretary of State’s discretion whether or not to impose a requirement to undertake work-related activity; and (ii) the Secretary of State’s discretion on the type of activity that is required. This appears to create at least two conundrums.

The first conundrum

22.      One conundrum was identified by Judge Mark in JS v Secretary of State [2013] UKUT 635 (AAC) and GS v Secretary of State [2014] UKUT 16 (AAC): if there is no work that the claimant could ever do, regulation 35(2) can never apply, because no work-related activity would make it (to quote section 13(7)) ‘more likely that the person will obtain or remain in work or be able to do so.’

23.      Ms Wilkinson argued that Judge Mark’s analysis ‘cannot be right because it would mean that the most vulnerable, who will not work again and for whom any WRA [work-related activity] will pose a substantial risk to their health, will have no chance of being assessed for SG [support group] under the extra protections of Regulation 35 because, by definition, there is no WRA they can do and thus there can be no substantial risk to their health …’

24.      In order to resolve this conundrum, Miss Wilkinson relied on section 13(7), which only requires that the activity should make it ‘more likely’ that the claimant will be able to obtain work. Pressed on when a person who could never work again might satisfy this requirement, she suggested a change of circumstances, such as a new form of treatment or medication. This argument does not work. For a start, it requires a tribunal to make contradictory findings of fact that (i) the claimant will never be able to work again, but (ii) this may change later. If finding (i) is correct, the tribunal cannot make finding (ii). But if finding (ii) is correct, the tribunal cannot make finding (i). The correct finding would be that there is at present no work that the claimant could do. This would not be sufficient to avoid the conundrum, as it would leave unresolved the issue whether regulation 35(2) applied for the time being.

25.      Regulation 35 may have to operate before any consideration has been given to the sort of work-related activity that might otherwise be appropriate for or required of a claimant. This is particularly likely during the appeal process. The provision has to be interpreted to operate effectively at that stage. It may also have to operate once consideration has been given. It must operate effectively in both contexts.

26.      The stage at which regulation 35(2) may have to operate explains why it is framed as a hypothesis. It requires the tribunal to identify the possible consequences of a particular postulate (the if bit). If a possible consequence would be a substantial risk to health, the provision is satisfied and the claimant qualifies for the support group. As I have already said, the postulate cannot be read literally. The tribunal does not simply have to postulate the claimant being found not to have limited capability for work-related activity. It also has to postulate the claimant actually undertaking such activity.

27.      It does not have to identify that activity with precision. That is a separate stage that will only be reached if the tribunal decides that the claimant does not qualify for the support group. If and when that stage is reached, it is a matter for the Secretary of State, not the tribunal. The tribunal’s task is preliminary to and necessarily more speculative and more general than the actual application of regulation 3 of the 2011 Regulations. The tribunal has to apply the hypothesis embodied in regulation 35(2). In doing so, it cannot deny the postulate. That, with respect to Judge Mark, is what he did. He denied that the postulate (the if bit) could ever apply in certain circumstances. But that is the very foundation of the provision. It is what the tribunal is required to accept. It cannot reject the basis of the hypothesis that forms the structure of regulation 35(2).

28.      In doing so, the tribunal has to limit itself to applying regulation 35(2) and avoid trespassing into the Secretary of State’s decision-making under regulation 3 of the 2011 Regulations. Expecting anything more would involve making the mistake that the Court of Appeal in Charlton said I had been making. To adapt the language of the Court, it would require the tribunal to embark upon the almost impossible task of imagining what hypothetical requirement, if any, the Secretary of State might have imposed should the issue have had to be decided. The way to remain properly within the tribunal’s jurisdiction lies in the level of generality at which the tribunal has to consider work-related activity. Ms Wilkinson accepted that my decision in AH was correct. What the tribunal has to do is to identify in a general way ‘the range and type of work-related activity which a claimant is capable of performing and might be expected to undertake’ (to quote AH); and it must do so regardless of whether the Secretary of State would actually require the claimant to undertake any activity and regardless of whether any such activity would have any effect on the claimant’s ability to ‘obtain or remain in work’ (to quote section 13(7)).

29.      Ms Wilkinson also accepted that the approach I had taken in ML and AH properly identified the range of approaches that tribunals should take. In AH, I decided:

31. The nature of the claimant’s disabilities will determine the nature of the evidence that the tribunal needs in order to decide whether regulation 35(2) applies. Broadly, there are two possibilities. In some cases, the tribunal will need only general information in order to decide that a particular claimant does or does not satisfy section 35(2). For example: a claimant whose only disability is restricted mobility should have no difficult in attending an interview or an appropriate course. In other cases, the tribunal will need evidence on the specific nature of the activity that the claimant would have to undertake. 

ML is an example of the first possibility:

16. … In this case, there was sufficient information for the tribunal to make a decision. Whatever work-related activity may involve, Mrs L should be able to undertake it. She is able to travel and even to drive herself short distances. She was able to attend and endure an interview and examination with the health care professional, which lasted for 51 minutes. She is able to attend to her own basic needs, to manage short trips, and to attend to her business in shops, her bank and the post office.

The second conundrum

30.      This analysis also provides the solution to another conundrum, which is: it would be unreasonable (under section 2(5)(b) and regulation 3(4)(a) of the 2011 Regulations) to impose any work-related activity that would give rise to a risk of substantial harm, so regulation 35(2) can never apply. One way to avoid this conundrum would be to say that the meaning of the 2008 Regulations cannot be affected by the later 2011 Regulations. So the introduction of the requirement of reasonableness in 2011 could not affect the interpretation of regulation 35(2). This argument does not work, because it assumes that there was no requirement of reasonableness before the 2011 Regulations. I do not accept that. The Upper Tribunal would surely have read the original legislation as requiring this anyway. As Lord Hoffmann said in Walker v Centaur Clothes Group Ltd [2000] 1 WLR 799 at 805:

It is not unusual for Parliament to say expressly what the courts would have inferred anyway.

31.      There is, though, a way to resolve this conundrum. Regulation 35(2) confers a right on a claimant: a right to be treated as having limited capability for work-related activity. The risk of substantial harm is both the condition precedent for that right and the rationale for the existence of the right. It is inappropriate for the existence and enforcement of such a protective right to depend on the exercise of a discretion. This is not a complete solution, as there is a further step that is required.

32.      The solution to the first conundrum identifies the nature of regulation 35(2) and the time when it may have to apply, which indicate the nature of the consideration involved. The consideration has to operate at a relatively general level that does not trespass into the role of the Secretary of State. This also explains why it is not appropriate to undertake a precise analysis of the reasonableness of the activity.

Cases to which regulation 35(2) does not apply

33.      My analysis prevents the exclusion of some cases from the scope of regulation 35(2). It does not, though, bring every case in which Schedule 3 is not satisfied within that provision. There remains the possibility that a claimant is seriously disabled but does not satisfy the conditions for the support group on account of the way the legislation is structured. There could, for example, be a claimant who will realistically never be able to work, but whose disabilities are not sufficient to satisfy any of the activities in Schedule 3 and for whom work-related activity may not pose a substantial risk. That is the inevitable consequence of the nature of the test. It depends on whether the activity would give rise to a substantial risk, not on whether it would confer a benefit: see my decision in CH v Secretary of State for Work and Pensions [2014] UKUT 11 (AAC). As I explained in ML v Secretary of State for Work and Pensions [2013] UKUT 174 (AAC):

17. … There are claimants who are not capable of work and never will be capable of work but whose condition and disabilities are not such that they can satisfy the conditions for the support group. To put it another way, the support group is not for those who will never be capable of work. It is for a narrower category.

CSE/0017/2014

34.      I was just finalising my decision when Judge Bano drew my attention to this decision, which he had recently given in Scotland. It is unfortunate that I was not aware of it sooner, because he has reached the same conclusion as I have but has expressed it much more clearly and succinctly:

12. … If regulation 35(2) is to have any real meaning, it is not open to a tribunal to find that work-related activity does not present a risk of harm to a claimant on the basis that the claimant will not actually be required to undertake any meaningful activity if it turns out to be harmful. I therefore consider that the action of the employment adviser of effectively bringing the claimant’s action plan to an end out of concern for her health was evidence which the tribunal should have taken into account when evaluating the risk of harm to the claimant if she were not found to have limited capability for work-related activity.

 

Signed on original on 1 April 2014

Edward Jacobs Upper Tribunal Judge