Good News for Employers on Disability Discrimination

by Hazel Phillips

At a time when anti-discrimination law is placing an ever increasing burden on employers, it was reassuring to see the House of Lords make a rare pro-employer decision in London Borough of Lewisham v Malcolm. This case marks a major departure from the previous approach that the courts (and tribunals) have taken in relation to disability discrimination.

The Background

The above case is actually a case that concerns housing and was heard under Part III of the Disability Discrimination Act 1995. However, the points of law that it addressed mean that the principles set down in this case will also apply to employment cases.

In this case the Council were trying to evict Mr Malcolm from his council flat, because it transpired that Mr Malcolm had been subletting his flat and had not lived in it for some time. In these circumstances the tenancy was no longer secure and the Council were entitled to terminate the tenancy by notice.

The complicating factor was that Mr Malcolm is a schizophrenic and he brought a claim against the Council claiming that by evicting him they were discriminating against him on the grounds of his disability.

At the first hearing of this matter the Court found in favour of the Council and found that there had been no discrimination and that they were entitled to evict Mr Malcolm. However, the Court of Appeal held that there had been discrimination.

The House of Lords reversed the decision of the Court of Appeal and held that there was no discrimination. In coming to this decision they addressed a number of important points that will change how many disability cases are dealt with.

The Law

The key issue that was looked at was the meaning of section 3A of the Disability Discrimination Act 1995 and specifically the correct interpretation of the phrase ‘a person discriminates against a disabled person if – (a) for a reason which relates to the disabled person’s disability, he treats him less favourably than he treats or would treat others to whom that reason does not or would not apply.’

The three key points that emerge from this case are:

(1) Employers can not be liable for disability discrimination unless they know that the employee is disabled.

(2) The reason for the treatment should be narrowly construed. This means that if an employee is off on long term sick leave and they are dismissed on the grounds of capability because they are off sick, then the reason for the treatment (the dismissal in this situation) would be the long term absence and not the fact that an employee was disabled.

(3) The appropriate comparator is someone who is in the same situation as the employee but who is not disabled. For instance, in the above situation the comparator would be someone who was not disabled, but who had nevertheless been off work for a long period of time.

This third point overturns the law as set down by the Court of Appeal in Clark v TDG Ltd (t/a Novacold) [1999] EWCA Civ 1091. Clark held that the correct comparator was someone to whom the reason for the treatment did not or would not apply. For instance, in Clark the reason for the dismissal was that the employee could not perform the duties that their job entailed and therefore the comparator was someone who could perform their duties. Under the new Malcolm case the correct comparator in the Clark case would be someone who could not perform their duties, but who was not disabled.

In the Malcolm case the House of Lords held that Mr Malcolm was evicted because he had sublet his flat, not because he was disabled. It was acknowledged that his mental health issues may have led him to leave his flat and sublet it. Nevertheless, it was going too far to say that the disability caused the eviction. The subletting caused the eviction and any tenant who sublet would have been treated in the same way.

What this means for Employers

This case is a complicated and involved judgment, but essentially it should make disability discrimination claims easier to defend for employers. Employees will have to show that treatment was due to their disability and not simply due to other events that may initially have been triggered by the disability.

The issue of who is the appropriate comparator now seems clearer and more logical, as the disabled person can now be compared to a non disabled person in the same circumstances. This should make it easier for employers to assess the fairness of their own decisions, by noting what action was taken in the past against non-disabled employees in the same situation.

Finally, the fact that an employer can now only be held to have discriminated against an employee if they know that they are disabled should reassure employers about potential claims coming from those with ‘hidden disabilities’. However, this case does not mean that employers can avoid getting medical evidence regarding ill employees. Employers should not turn a blind eye when they know an employee has health concerns, simply so they can argue that they did not discriminate because they did not know there was a problem.

Disability discrimination is a complex area and it will be interesting to see how this case changes the tribunals’ approach to disability cases. If you require any assistance in relation to ill health or disability issues or want further information on how this case may affect your business, please contact the employment team at Burnetts on 01228 552222.

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July 2008