Does an employer have a duty to make reasonable adjustments for a disabled employee to continue to pay a higher salary when an employee is moved to a lesser role?
According to the recent decision of the Employment Appeal Tribunal (EAT) in the case of ‘G4S Cash Solutions (UK) Ltd -v- Powell’, the answer is surprisingly, yes.
The facts of the case
Mr Powell worked for GCSU Ltd (the Company) as an engineer responsible for maintaining ATM’s in central London. Over the years, he developed back problems and, by mid-2012, he was no longer fit for jobs involving heavy lifting or working. Upon his return to work following a period of sickness absence in 2012, Mr Powell began working in a newly created role of ‘key runner’, which involved driving from the Company’s depot to deliver parts and keys to its ATM engineers, this role allowed him to travel between jobs by public transport. The Company continued to pay Mr Powell his original engineer’s salary for the key runner role, and he considered this to be a long term arrangement.
In May 2013, the Company considered discontinuing the key runner role for operational reasons. It told Mr Powell that the role was not permanent and gave him a list of alternative vacancies to consider, stating that if nothing was suitable then he could be dismissed on medical grounds. Mr Powell consulted his solicitor and presented a grievance, stating that the Company was attempting to alter his terms and conditions.
As a result, the Company decided to make the key runner role permanent, but at a lower rate of pay to reflect that the role did not require engineering skills, which in turn entailed a 10% pay reduction. Mr Powell was not willing to accept this reduction and as such he was dismissed from his employment on 8 October 2013.
An Employment Tribunal (ET) rejected Mr Powell’s claim that there had been an agreed variation to his contract of employment when he commenced in the key runner role, which entitled him to continue in that role at his original salary on a permanent basis. The ET held that the Company was required under Section 20 of the Equality Act 2010 (‘duty to make adjustments’), to employ Mr Powell as a key runner at his original rate of pay.
The ET found that Mr Powell’s dismissal was discriminatory and unfair, and that the reasonable adjustments required extended to maintaining Mr Powell’s former pay in his new role. The Company appealed against this finding, and Mr Powell cross-appealed on the contractual variation point.
The EAT found that there had been a variation of Mr Powell’s contract to begin with which was agreed but a subsequent variation could not be imposed without his acceptance, when he undertook the role of key runner and he was not entitled to continue in that role on a permanent basis on a higher salary.
Additionally, the EAT found no reason in principle why the duty to make reasonable adjustments would not extend to protecting an employee’s pay, in order to counter a disabled employee’s disadvantage.
Practical tips for Employers
• Employers should always be clear when offering roles to employees as to whether they are intended to be permanent roles or for a defined fixed period.
• Be alive to the fact that consent maybe required to make a reasonable adjustment which may change an employee’s terms and conditions.
• The EAT confirmed that it did not expect claims for pay protection in circumstances like in this case to be an ‘everyday event’ for ET’s, however, it did confirm that it was possible to foresee cases where it may be a reasonable adjustment in order to get an employee back to work, or to keep an employee in work in accordance with the objective of the legislation.
• This decision highlights that the question in such situations will always be, is it reasonable for an employer to have to take steps to avoid a disabled employee’s disadvantage? This will have to be assessed on a case by case basis, taking in to consideration the size and resources of your business and the overall practicality and financial cost to the business.
This is an interesting case and an outcome that employers should be mindful of, when faced with decision making regarding reasonable adjustments. Should you require any advice or assistance with regards to making reasonable adjustments in respect of an employee you should contact Lindsey or Sarah on [email protected] or on 0161 478 3800.