Cap on “voluntary exit scheme” payments to disabled police officers was discriminatory12/03/20
In the recent case of Chief Constable of Gwent Police v Parsons and another, the Employment Appeal Tribunal (EAT) provided guidance on objective justification in cases of alleged unfavourable treatment for a reason arising in consequence of disability.
The Claimants were both in their 40s and, as a result of their disabilities, had been certified (under regulation H1 of the Police Pension Regulations 1987) as disabled from performing the ordinary duties of a police officer. As a result, the Claimants were eligible to retire on ill health grounds (and receive an ill health pension), but the Chief Constable had instead exercised his discretion to retain them.
A national “voluntary exit scheme” was introduced by the Secretary of State in 2013 that enabled Chief Constables to pay a compensation lump sum to police officers who left the force voluntarily. The scheme was adopted by Gwent Police in July 2016. Both Claimants submitted successful applications but the Chief Constable decided not to pay them their full entitlements (of 21 and 18 months’ pay respectively) but to cap them at 6 months’ pay because they had H1 certificates which entitled them immediately to access their deferred ill health pensions upon leaving the police.
The Claimants’ brought claims under section 15 of the Equality Act 2010 of discrimination arising from their disabilities, and the Employment Tribunal (ET) upheld their claims.
Gwent Police appealed to the EAT.
The EAT dismissed the appeal and upheld the ET’s decision on each of the following issues:
- The Chief Constable’s decision to cap the compensation payments was clearly unfavourable treatment under the Equality Act 2010
- The Claimants’ H1 certifications (upon which the decision to cap the compensation payment was based) clearly arose in consequence of their disabilities
- The unfavourable treatment was not justified as the Chief Constable did not provide any information which established that, as the Claimants’ were entitled to immediate receipt of their deferred pension benefits, the full compensation payments to either Claimant would have amounted to a “windfall”.
What to take away
In certain circumstances, preventing a “windfall” could amount to a legitimate aim which provides a defence to a claim of discrimination under section 15. However, this case highlights that a decision to withhold, cap or limit entitlement to a compensation payment will not inevitably be a proportionate means of achieving that aim. In order to be objectively justified, a decision to withhold, cap or limit a compensation payment in order to prevent a “windfall” (for example, because deferred pension benefits would also be immediately payable) cannot be based on general assumptions – the individual circumstances of each case must be considered, including clear evidence of any “windfall” that would in fact occur if the full payment was made.
It also acts as a reminder for Chief Constables to ensure that, where officers with an H1 certification are retained, any application made by them under a voluntary exit scheme is carefully reviewed before any decision is made and, if the application is to be accepted, how their entitlement to compensation is assessed.
For further information on how this issue might affect your organisation, please contact Paul McFarlane, Raj Chahal or Lee Carroll.