The Supreme Court held that Mr Williams was not treated unfavourably under section 15 of the Equality Act 2010 when the enhancement to his ill-health early retirement pension was calculated using his part-time salary. He was entitled to that immediate pension only because of his disabilities; without them he would have had no pension until normal retirement age. His appeal was dismissed.
The dispute
Mr Williams was a member of the university’s pension scheme. He retired on grounds of ill health in 2013, after more than 13 years of pensionable service.
For the first ten years he worked full time. Later reductions in his hours, eventually to half time for nearly two years by June 2013, were made at his request as reasonable adjustments because of his disabilities. In 2013 he was accepted for ill-health early retirement on the agreed medical view that he was likely to be permanently incapable of his duties or comparable work.
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The scheme paid an immediate lump sum and annuity based on benefits already accrued, without actuarial reduction, calculated on his actual salary. It also paid an enhancement, again immediate and without actuarial reduction, calculated on his actual salary at retirement and a period of deemed service to normal pension age of 67. The dispute concerned only that enhancement. Mr Williams said that using his part-time rather than full-time salary was unfavourable treatment because of his inability to work full time, and therefore discrimination under section 15(1)(a) of the Equality Act 2010 unless justified.
The courts below
Section 15 asks whether a disabled person has been treated unfavourably because of something arising in consequence of the disability, and whether that treatment is a proportionate means of achieving a legitimate aim. It was enacted after the House of Lords’ decision in Malcolm, and does not require a comparison with another person.
The Employment Tribunal accepted Mr Williams’ claim, treating unfavourable treatment as including financial disadvantage and comparing him with someone whose disability arose suddenly while still on full-time pay. The Employment Appeal Tribunal rejected that approach. Langstaff J held that the tribunal had wrongly reintroduced a comparison. Advantageous treatment is not unfavourable merely because it might have been more advantageous. He described the ill-health provisions as immensely favourable, since only disabled members could receive an immediate and enhanced pension at 38, but he would have remitted the case.
The Court of Appeal agreed that there was no unfavourable treatment. Bean LJ accepted that the pension was less advantageous than that of a hypothetical member suddenly disabled from full-time work, but far more advantageous than if Mr Williams had not become permanently incapacitated. The court dismissed the claims, so justification did not arise.
The Supreme Court
Lord Carnwath, with whom Lord Kerr, Lord Hodge, Lady Black and Lord Kitchin agreed, substantially agreed with the Court of Appeal. In most cases little is gained by drawing narrow distinctions between “unfavourably” and similar words such as disadvantage or detriment, or between objective and mixed tests. The Equality and Human Rights Commission’s Code of Practice usefully indicates a relatively low threshold, but it does not answer the objection to this claim.
The relevant treatment was the award of the pension. There was nothing intrinsically unfavourable about that award. Mr Williams was entitled to any pension at that time only because of his disabilities. Had he been able to work full time, the result would not have been a larger enhancement, but no immediate pension at all. The award was not unfavourable, and could not reasonably have been regarded as unfavourable. The appeal was therefore dismissed, and justification did not arise.
Verdict: The Court unanimously dismissed Mr Williams’s appeal. The immediate pension award was not unfavourable treatment under section 15. There was therefore no need to decide whether it could be justified.
Source: Williams v The Trustees of Swansea University Pension & Assurance Scheme and another [2018] UKSC 65
