Employment case law update September 2020

A number of key employment law cases of significance for employers have recently been decided.

Disability discrimination

Sullivan v Bury Street Capital Limited

In this Employment Appeal Tribunal decision, it was held that an employee suffering paranoid delusions was not considered disabled for the purposes of the Equality Act 2010.

The Claimant suffered which delusions had caused him to believe he was being tracked by a Russian gang. This, in turn, affected his timekeeping and attendance at work.

At first instance, the tribunal ruled that, although the paranoid delusions did have the required substantial adverse effect, at the time this effect was not anticipated to have an impact on the employee long term, as it was not likely to last for at least 12 months, nor likely to recur.

The EAT agreed with the first tier decision. It also held that the later recurrence of the condition did not undermine the assessment made of the potential for recurrence, which the tribunal must conduct on the conditions prevailing at the time.

Equal pay

Walker v Co-operative Group and another

The Court of Appeal has ruled that an employment tribunal erred in its judgment by using an incorrect test when determining whether the defendant, the Co-op, could establish the material factor defence.

The Court of Appeal held the test is not whether the difference in pay is justified, but rather whether the reason for the difference is causative and material.

The female Claimant had been promoted to Group Chief HR Officer in the executive team in February 2014. The executive team were categorised by different remuneration tiers. The Claimant was placed in tier 4 of 4, meaning she was on a lower pay band than other male executives.

12 months later, following a job evaluation survey that rated Mrs Walker’s work as equivalent to, or higher than, that of her comparators, Mrs Walker brought a number of claims including a claim for equal pay.

When faced with an equal pay claim, employers may be able to rely on a defence that any disparity in pay is due to a material factor unrelated to sex.

In Walker, the Co-op argued that four material factors were applied to determine pay:

whether the role was vital to the survival of Co-op and the Claimant’s role was important but not vital;
executive experience and the Claimant was unproven at that level;
flight risk and there was concern that her comparators might follow the former CEO who had recently left; and
market forces and the Claimant’s salary exceeded the market rate.

At first instance, the tribunal considered the explanations for the pay difference were applied at the point when the Claimant was appointed to the role, but were “historical” and “no longer material” when an evaluation was carried out 12 months later.

Accordingly, the tribunal found the material factor defence failed, the pay difference could not be justified and Mrs Walker was entitled to equal pay to that of her comparators from the time of the job evaluation.

The decision was, however, overturned on appeal.

The Court of Appeal took a different view. It held the tribunal’s determination of the approach was unsatisfactory because it failed to ascertain the point at which the Claimant was doing equal work and by extension the starting point for her claim.

The tribunal also overlooked the fact that there was at least one material factor which remained causative of the difference in pay between each comparator.

On the facts of the case, the Court of Appeal deemed it was not open for a tribunal to find that a material factor ceases to apply or operate at a future point in time.

Gender reassignment discrimination

Taylor –v- Jaguar Land Rover Ltd

The Birmingham Employment Tribunal has decided in favour of an employee, finding that protection of non-binary and gender-fluid individuals falls within the scope of gender reassignment under the Equality Act.

The Claimant, Ms Taylor, was an engineer employed at Jaguar Land Rover for more than 20 years. Ms Taylor began identifying as gender-fluid in 2017. When she began to wear women’s clothes, she was subjected to derogatory comments and abusive jokes from colleagues and experienced difficulties using toilet facilities. There was also a lack of support from management.

Ms Taylor brought a successful claim for constructive dismissal on the basis of having suffered harassment, victimisation and discrimination due to gender reassignment and sexual orientation – a protected characteristic under Section 7 of the Equality Act.

While a first-tier decision, this ruling provides new clarity on the protected status of non-binary or gender-fluid individuals.

Legal disclaimer

The matters contained in this article are intended to be for general information purposes only. This article does not constitute legal advice, nor is it a complete or authoritative statement of the law, and should not be treated as such. Whilst every effort is made to ensure that the information is correct, no warranty, express or implied, is given as to its accuracy and no liability is accepted for any error or omission. Before acting on any of the information contained herein, expert legal advice should be sought.