Alerts

Reasonable adjustments and pay – where do you draw the line?

Employers are under a duty to make reasonable adjustments to help disabled job applicants and employees in certain circumstances. The duty arises where a disabled person is placed at a “substantial disadvantage” by either a practice applied by the employer; a feature of the employer’s premises or an employer’s failure to provide an auxiliary aid. Only an employment tribunal can decide whether an adjustment could have been reasonable to make in the circumstances, and in doing so will take into account a number of factors such as the cost of the adjustment v the employer’s financial resources.

This issue was considered recently by the Employment Appeal Tribunal in terms of whether a disabled employee moved to a lesser role was entitled to receive the higher salary of his previous role as a reasonable adjustment.

Powell v G4S Cash Solutions (UK) Limited

G4S Cash Solutions (UK) Limited (“G4S”) maintains automatic teller machines (ATMs) and replenishes them with cash. It employs engineers for this purpose. Some are first line maintenance engineers (FLM); others are single line maintenance engineers (SLM). SLMs are more highly paid and are better trained than FLMs.

Mr Powell began working for G4S in 1997. He worked in a variety of roles, including as an FLM and an SLM. As the years went by, Mr Powell had worsening problems with his back and by mid-2012 he was no longer fit for jobs involving heavy lifting or work in confined spaces. It was common ground that he was disabled for the purposes of the Equality Act 2010 from this time onwards.

In the Summer of 2012, G4S created a new role to support ATM engineers working in central London. The role was described as “key runner” and involved driving from G4S’s depot to various locations to deliver keys and parts to engineers. This enabled the engineers to travel by public transport.

Following his return to work after a period of absence, Mr Powell began to work as a key runner whilst being paid his original salary as an SLM engineer. This remained the case up until the termination of his employment in October 2013. By May 2013, G4S was thinking about discontinuing the role of key runner and told Mr Powell that the role was not permanent. Mr Powell was invited to look through a list of vacancies and consider what alternative work he would be able to do. He was told that if nothing was available he would be dismissed on medical grounds.

Mr Powell submitted a grievance and G4S decided to make the key runner role permanent and confirmed that it was available for him. However, G4S said that the role did not require engineering skills and therefore it was only being made permanent at the lower rate paid to an FLM engineer. This would reduce his salary by around 10 percent. Mr Powell was unwilling to accept this reduction and no other suitable vacancy could be identified. He was therefore dismissed. Mr Powell brought proceedings in the employment tribunal against G4S which included claims for unfair dismissal and discrimination arising from a disability.

Employment Tribunal (ET)

In relation to the issue of Mr Powell’s salary, the ET found that G4S failed to make the reasonable adjustment of allowing him to work as key runner at the higher salary rate of an SLM engineer. Having reached that conclusion it found that his dismissal amounted to discrimination arising from disability and was unfair.

The Judge said that the practice being applied by G4S was the requirement to be fit to do the SLM work. Mr Powell was subjected to a substantial disadvantage compared to non-disabled employees in that he was unable to carry out his duties as an SLM engineer. Therefore it was a reasonable adjustment to employ him in the key running role as a permanent position without reduction in his pay as a way of removing this disadvantage. By failing to do so and dismissing him, G4S discriminated against him.

Specifically, the Judge commented that the difference between the rate of pay Mr Powell had as an SLM engineer and the rate of pay offered to him at the reduced rate was around £2484 per annum, and given that he probably had another 15 years to work the difference over that period would be around £37,260. He said that G4S was a company with “very substantial resources” and the additional cost would have been easily affordable to it.

G4S had argued that paying Mr Powell at the higher rate would cause discontent among other employees if they found out that he had been given “special treatment”. However, no evidence was put before the ET to this effect. G4S appealed.

Employment Appeal Tribunal (EAT)

On appeal, G4S argued that the ET’s approach was contrary to the purposes of the reasonable adjustments legislation, which was to assist disabled persons to obtain employment and to integrate them into the workforce; not to treat them as “objects of charity”. It also argued that if it applied this practice across the board to persons with a disability then it might have huge implications for its budget.

In response, Mr Powell argued that the employer’s duty is to alleviate a disadvantage to disabled persons to the extent that it is reasonable to do so, and G4S had put forward no financial evidence to suggest that it was unable to pay him at the higher rate of SLM engineer.

The Judge commented that the real issue related to the adjustment and specifically whether it was reasonable to have to place Mr Powell in the key runner role while keeping his existing pay. He recognised that the duty to make reasonable adjustments may require the employer to treat an employee more favourably than others. For example, it may require the employer to transfer the employee to a different role at a higher grade without competitive interview. However the question will always be whether it is reasonable for the employer to have to take that step.

It was noted that protecting someone’s pay in these circumstances is no more of a cost to an employer than any other form of cost, and reasonable adjustments generally require the employer to pay something. It would not be an everyday event for an employer to make up an employee’s pay in this way, but there would be cases where this may be a reasonable adjustment and each claim would depend on its own facts. For example, it may cease to be a reasonable adjustment if the job were to disappear or if the economic circumstances of the business altered.

However, in this case the ET had taken into account and analysed the financial evidence as it had a bearing on the question as to whether it was reasonable for G4S to have to maintain Mr Powell’s higher salary. The main reason that G4S had put forward for not paying Mr Powell the higher rate was said to be the likelihood of discontent from other employees; however this was held to be an unattractive reason and the ET was entitled to reject it. G4S’s appeal on this issue was dismissed.

Comment

Whether any potential adjustments are required will depend on whether they are reasonable in the circumstances. Adjustments could be anything from making adjustments to premises to the provision of training and support or modifying employees’ working hours.

An employer will not breach the duty unless it fails to make adjustments which are reasonable. This is a fact sensitive question and will in each case depend on its own facts.

Where an employer fails to comply with the duty to make reasonable adjustments, this will be classed as a form of discrimination. Where a claimant succeeds in such a claim the ET may award compensation which would be unlimited in scope. Therefore, it is very important to give consideration to potential adjustments when dealing with disabled employees to avoid falling foul of this duty.

If you have any queries contact Joanne Holborn, Tom Scaife or Caroline Rayner on 01228 552600 or 01524 548494

Email Alerts

Baines Wilson LLP send our clients and contacts legal updates by way of short email alerts. If you would like to receive our regular alerts, please follow the link below.

Sign up for Alerts

Awards & Accreditations