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In the case of Newcastle upon Tyne Hospitals NHS Foundation Trust v Bagley, the EAT has confirmed the position in regards to what constitutes a reasonable adjustment and also provided welcome clarification on when aggravated damages should become payable and what amounts to correct sums where these damages, and others, are concerned.
In reaching their decision the EAT cited the recent cases of Royal Bank of Scotland v Ashton and Commissioner of Police of the Metropolis v Shaw which both provided extremely helpful guidance on how tribunals should approach reasonable adjustment cases and when aggravated damages should be awarded.
The case was brought under the Disability Discrimination Act 1995 (DDA) (Section 4A(1) of the DDA placed an employer under a duty to make reasonable adjustments where a provision, criterion or practice (PCP) applied by the employer put a disabled person at a substantial disadvantage in comparison with persons who were not disabled), but the effects of it are still highly applicable to the provisions which can now be found under the Equality Act 2010 which contains a similar duty to make reasonable adjustments
Mrs Bagley was injured at work (at the “Trust”) in November 2008 and became disabled. After her entitlement to full sick pay expired, she became entitled to Temporary Injury Allowance (TIA) under the National Health Service (Injury Benefit) Regulations 1995 (this ‘tops up’ sick pay to 85% of salary in the case of work-related injuries).
In March 2009, she commenced a phased return to work on light duties. Trust policy stipulated that during a phased return an employee could only receive pay for the hours worked at this time. (TIA was no longer applicable as she had returned to work in any capacity.)
A way of countering the effect of reduced pay was for employee’s to use up paid annual leave. Mrs Bagley did this but then realised that she could not manage to progress to work full time. However, financially she could not afford to only work part-time.
In May 2009, having exhausted her annual leave allowance, Mrs Bagley asked if she could apply for Permanent Injury Benefit (PIB), which is paid by the NHS Pensions Agency. As with TIA, this tops up salary to a maximum of 85%, and is payable if the injury in question causes either termination of employment or a permanent reduction in earnings.
Whilst awaiting a response, Mrs Bagley went back onto sick leave and began receiving TIA again. In September 2009 a formal application was made for PIB. However, a number of errors by the Trust meant that the form was not properly submitted until the end of January 2010. At that stage NHS Pensions returned the forms, stating that "a date for permanent change to lower paid employment must be known" before the form could be processed. This led to further referrals to Occupational Health and further suggestions for redeployment which together caused additional delay.
By August 2010 Mrs Bagley’s health had deteriorated to the point where she stated that she was not fit for work of any sort. As a result of this she was warned by the Trust that termination may have to be considered. This then happened and, following a successful application, she then began receiving PIB of 85%.
She brought a tribunal claim for failure to make reasonable adjustments and disability discrimination under the DDA.
The tribunal held that the Trust had failed to make reasonable adjustments for Mrs Bagley. These included, amongst other things, the fact that they failed to pay her TIA or PIB (or equivalent) to ‘top-up’ her part-time earnings, so as to enable a phased return; requiring her to agree to a permanent reduction in hours before considering her PIB application; and failing to provide support to Mrs Bagley in navigating "through a maze of policies", and "washing its hands" of all matters which it categorised as concerning Mrs Bagley's private life or financial problems (she had a mortgage to pay and her husband was out of work).
They were also very critical of the behaviour by the Trust’s HR team, specifically that they treated PIB applications as routine and chose to allocate them to an inexperienced junior employee when a senior colleague was on leave, and then not checking up on progress; and not having a diary system to chase urgent matters. They felt that overall the HR approach to this matter lacked efficiency which was something “needed” by Mrs Bagley, as a disabled person.
Tribunals in discrimination cases can award compensation for injury to feelings. The award is based on a scale, known as the “Vento scale”, which has three brackets, ranging from £600 to £30,000. The tribunal held that this case was "at the very top" of the Vento scale. It stated that Mrs Bagley would "go to her grave knowing that it could be her symptoms would have been ameliorated if the Trust had been less intransigent. She might have worked, if only part time, to the end of her career... The hurt will last forever." It therefore awarded £30,000.
In addition, it is also open to a tribunal to award aggravated damages in discrimination cases where the respondent has aggravated the claimant's injury by acting in a high-handed, malicious, insulting or oppressive manner. On this basis the Trust also awarded £10,000. To support their decision they used the examples of the Trust acting in a "high-handed" and oppressive manner when they suggested that Mrs Bagley stayed at home because it was more profitable for her to do so; when they treated administrative convenience as more important than Mrs Bagley's health and career; and by failing to admit that Mrs Bagley was disabled until six months after the ET1 was submitted.
The Trust subsequently appealed again the decisions of the tribunal, in both liability and financial remedies.
The EAT allowed the appeal on both liability and remedies:
The EAT held that the tribunal had erred in finding that the Trust had failed to make reasonable adjustments. In considering this point the EAT looked to the recent case of Royal Bank of Scotland v Ashton.
Royal Bank of Scotland v Ashton: In particular, the EAT in this case emphasised that the duty to make reasonable adjustments is not a general duty to "assist a disabled person" or help them overcome the effects of their disability. Where there is a PCP which places the disabled person at a substantial disadvantage compared to non-disabled people, the duty arises to take necessary and reasonable steps to stop that disadvantage.
The EAT therefore held that first, tribunals must identify the relevant PCP. They held that the tribunal had failed to do this, not least because they referred to the HR inefficiency which itself is not a PCP.
The EAT then clarified that the second step for a tribunal is to identify whether the claimant is, by the application of the PCP, placed at a substantial disadvantage compared with those who are not disabled. If the effect of the PCP on the non-disabled person is the same then there is no disadvantage and therefore no duty to make adjustments. Again, the HR inefficiencies identified by the tribunal in this case could have equally affected non-disabled employees. In drawing this conclusion they used the example of processing maternity pay or an employee’s return to work after maternity leave.
In looking at whether Mrs Bagley was put at a disadvantage the EAT concluded that this was not the case. While they recognised a delay in the Trust sending off the PIB application, they confirmed that during this time she was receiving TIA payments (at 85% these were the same as PIB). They also held that a return to work was available to her; while she said she could not afford the drop in pay, they held this disadvantage was a financial one (as a result of a need to pay her mortgage and her husband being out of work) and could equally have applied to a non-disabled person.
Remedies: injury to feelings
Although the EAT ruled that the tribunal were wrong on liability (and so no damages were applicable in any event) they also looked at the payments made to Mrs Bagley and in doing so held these were perverse. In looking first at the injury to feelings award they held that the tribunal had incorrectly considered the Vento guidelines; in their view the case did not warrant an award in the highest bracket, which is reserved for the "most serious cases", such as those involving a lengthy campaign (here the conduct lasted for 8 months) and as such the award made was "manifestly excessive and/or disproportionate."
They revised the tribunal’s assessment and held that the injury to feelings award, if liability had been upheld, should be reduced to £11,000 which is the middle of the middle band.
Remedies: aggravated damages
The EAT were also of the view the decision relating to the aggravated damages award was perverse. In the main this was because the tribunal had focused on a disproportionate view of some of the Trust's conduct. The EAT also held that the tribunal had been wrong to find that the Trust's conduct of the proceedings had been "oppressive".
The EAT referred to the 2012 case of Commissioner of Police of the Metropolis v Shaw in seeking guidance on when an award should be made.
Commissioner of Police of the Metropolis v Shaw: In this case the EAT held that when looking at whether aggravated damages are applicable a tribunal should focus on the effect the aggravating conduct had on the employee's injury to feelings. They should not focus on the seriousness of an employer's conduct. It was made clear that such damages are an aspect of injury to feelings, not an additional award, and are compensatory, not punititve.
This case provides further, useful guidance that the duty on an employer to make reasonable adjustments is not a general duty to support a disabled person through their difficulties or help them to overcome them. It reminds tribunals that there is a specific formula to follow in such cases and that this cannot be overlooked. As above the formula is an analysis of:
It also confirms that, while offering a phased return to work may be a reasonable adjustment, it does not necessarily mean having to pay for work not done.
Finally, this case, along with Commissioner of Police of the Metropolis v Shaw, together provides useful assistance on when aggravated damages are applicable. They serve as a useful reminder for claimants that, if they want to claim aggravated damages, they will need to provide detail in their witness statement and supporting evidence on how the aggravating factors to the respondent's conduct caused them additional distress. It is not sufficient to merely show that the respondent "acted in a high-handed, malicious, insulting or oppressive manner."