The Supreme Court has clarified what amounts to “unfavourable treatment” for the purposes of a claim for discrimination arising from disability under the Equality Act 2010.
In the case of Williams v Trustees of Swansea University Pension and Assurance Scheme, the Supreme Court has held that a disabled employee who was entitled to a pension because of his ill health was not treated “unfavourably” because his pension was based on his final part-time salary rather than his previous full-time one.
Employers providing benefits to disabled employees can take some comfort from the Supreme Court’s decision. Just because a benefit being provided to a disabled individual is not the most advantageous it could be, it will not necessarily be deemed to constitute “unfavourable treatment” for the purposes of bringing a disability discrimination claim.
Mr Williams worked for Swansea University. He was forced to retire early at the age of 38 by reason of ill-health caused by his disabilities, which included Tourette’s Syndrome. At his request, Mr Williams had reduced his working hours (and salary) by 50% in the final year of his employment due to his ill health.
Under the terms of his pension scheme, upon ill health retirement Mr William’s was entitled to a lump sum and annuity, payable immediately and with no actuarial reduction for early receipt, based on accrued benefits, in addition to an enhancement. As the enhancement was calculated as if Mr Williams had continued to work until the age of 67 by reference to his final salary, Mr Williams received only 50% of the pension to which he would have been entitled had he retired a year earlier, before his working hours had been reduced.
Mr Williams brought a claim against the University and the pension scheme trustees, arguing that by basing his pension on his final part-time salary rather than his previous full-time salary, he received a lower pension and had been treated unfavourably. He argued that this amounted to discrimination arising from his disability.
At first instance, the Employment Tribunal held that Mr William’s disability caused him to have a lower pension than he would have done had his disability not caused him to work part-time. It went on to find that the trustees of the pension scheme had failed to establish that such unfavourable treatment was objectively justified.
The Employment Appeal Tribunal, Court of Appeal and Supreme Court all disagreed, however. Overturning the Tribunal’s decision, the Employment Appeal Tribunal held that the conclusion reached by the Tribunal that Mr Williams had suffered unfavourable treatment was “manifestly perverse”. On appeal, both the Court of Appeal and Supreme Court both agreed with the Employment Appeal Tribunal. The Supreme Court held that this was not capable of amounting to unfavourable treatment for disability discrimination purposes as, the award of a pension in itself was not ‘intrinsically unfavourable’ or ‘disadvantageous’ to Mr Williams. Indeed, Mr Williams was only entitled to a pension at all because of his disabilities (had he been able to work full time he would have enjoyed no immediate right whatsoever to a pension)