Case Law | McAllister v Revenue and Customs Commissioners | Moorepay
May 16, 2023

Case Law | McAllister v Revenue and Customs Commissioners

Since many employees who are off sick for a long time have a health condition that affects their ability to go to work, it’s likely they will have a disability for employment purposes.

In general, this means the employer must:

  • Not treat the employee less favourably because of their disability or any symptoms of their condition than they would treat others.
  • Make ‘reasonable adjustments’ to ensure the employee with the disability is not put at a disadvantage.

Many employers will know they cannot dismiss somebody because they have a disability. Instead, in the example of a person who has been off work for a long time, they will dismiss them because of their absence.

The employee may argue they have only been absent because of their disability, so they have been treated less favourably because of something which arises from their disability.

This is the basis of a claim for ‘discrimination arising from disability’ under s15 of the Equality Act 2010 (the “EqA”).

However, the important defence in these circumstances is whether the employer can show their treatment of the employee was a ‘proportionate means of achieving a legitimate aim’.

In the recent case of McAllister v Revenue and Customs Commissioners  (2022), the Employment Appeal Tribunal had to consider these circumstances.

  • In this case, the Employment Appeal Tribunal (EAT) upheld the decision of the Employment Tribunal (ET). 
  • The dismissal of a disabled employee on long-term sickness absence did not constitute unfavourable treatment because of something arising in consequence of a disability under s.15 EqA.  
  • The respondent was able to show that, although the dismissal was related to the claimant’s disability, it was justified in that it was a proportionate means of achieving a legitimate aim.

Case outline

Mr McAllister [MM] worked at HMRC from May 2011. He suffered from anxiety and depression and had a lot of lengthy periods of sickness absence, much of which were not related to his mental health condition.

Between 2016 and his dismissal in December 2018, MM was absent from work for 245 days on 23 occasions.

At the time of his dismissal, he had been off work for seven months and said that he was unfit to work in any capacity. However, sickness absence relating to his disability had only commenced in July 2018.

MM was dismissed in December 2018 for reason of capability as HMRC considered his absences were impacting productivity and staff morale and that all reasonable adjustments had been considered.

MM was dismissed in December 2018 for reason of capability as HMRC considered his absences were impacting productivity and staff morale and that all reasonable adjustments had been considered.

The Dismissing Officer, Mr Khan, considered that there had been sufficient time to allow MM’s to improve. He concluded that there was no sign of anything changing. There was no clear prospect of a return to work in the near future.

Mr Khan also concluded that MM did not want to return to work. He was “single minded” in stating that he did not want to go back to work and work with his colleagues. Mr Khan concluded there was no feasible alternative to dismissal given the MM’s view.

Reasonable adjustments

  • Mr Khan considered reasonable adjustments and concluded that all adjustments had already been exhausted. He considered whether a transfer could be achieved to another team.
  • However, it was not possible simply to order a transfer as there needed to be a business case and that would need time. MM would need to return work in the first instance. MM had all but ruled that out and was not in a position to return to work.
  • Mr Khan also considered the impact that MM’s continued absence would have on the team of 10/11 people. As MM had not been replaced, the existing staff had to cover his work.
  • The absence also impacted on productivity and morale. MM’s line manager was having to spend a considerable amount of time managing and supporting MM rather than supporting the rest of the team.

The appeal

Mr M appealed his dismissal. The Appeal Officer considered what alternatives there were for MM but concluded none was suitable. Having balanced all the facts, she decided that the business could no longer sustain MM’s absence.

MM was unable to give a date when he would be likely to return. It seemed little had changed with regard to the condition and likelihood of a return to work in the foreseeable future. MM admitted that he was not ready to return to work and was still unable to provide a return-to-work date at that point or in the future.

The Appeal Officer used her knowledge and experience as to what an individual’s absence would cause the department. It was not possible to quantify this as it was not known what work was done but the claimant’s role was not replaced. His absence impacted upon productivity.

CSCS payments

As MM was dismissed on grounds of capability, he was entitled to receive a payment under the Civil Service Compensation Scheme [CSCS] but this payment was reduced by 50% due to his conduct in failing to answer calls, returning relevant documentation on time, turning up late during phased return to work, and also displaying disruptive behaviour. He appealed this decision and on review, his payment was increased to 80%.

MM then brought Tribunal claims including a claim for discrimination arising from disability in relation to his dismissal and the reduction of his CSCS payment.

Case decision

At the initial Tribunal, MM’s claim for discrimination arising from disability in relation to his dismissal was unsuccessful.

The ET held that although the Claimant had been dismissed due to something (his absences) arising in consequence of his disability, the dismissal could be justified as a proportionate means of achieving the legitimate aims of ensuring staff were capable of demonstrating satisfactory attendance and a good standard of attendance, maintaining a fair, effective, and transparent sickness management regime and the efficient use of resources.

The Tribunal did uphold his claim in relation to the decision to reduce the CSCS payment to 50% but found that the appeal decision to increase only to 80% was again, objectively justified.

MM appealed both findings. HMRC cross-appealed the ET’s decision on the CSCS payment.

The EAT dismissed Mr McAllister’s appeal and allowed HMRC’s cross-appeal.

The EAT could find no fault with the Tribunal’s decision on HMRC’s decision to dismiss MM. The ET had found that the absence was detrimental to HMRC and then balanced this with the impact of dismissal and the aim of ensuring that staff was capable of satisfactory attendance.

While HMRC acknowledged that MM’s dismissal was unfavourable treatment, it argued that it was a proportionate means of achieving a legitimate aim, namely:

  1. to ensure staff were capable of demonstrating satisfactory attendance and a good standard of attendance (comprising the aims of the maintenance of a fair, effective and transparent sickness management regime and efficient use of resources)
  2. to provide a good customer service, and
  3. to apply its policies fairly and consistently

The EAT could find nothing wrong with the ET’s approach to objective justification.

Regarding point 1, this was a legitimate aim and corresponded to a real need on the part of HMRC.

Having found that MM’s absence adversely impacted HMRC, the ET had carried out the required balancing exercise, having regard to the discriminatory impact of the dismissal on MM.

The ET had also considered whether the employer’s aims could have been achieved via les discriminatory measures (e.g. waiting longer, giving further warnings, etc.).

It found that these would not have been appropriate to achieve the aims of ensuring satisfactory attendance and a good standard of attendance, comprising the maintenance of a fair, effective and transparent sickness management scheme and an efficient use of resources.

As for point 3, the EAT endorsed the ET’s finding that it was a legitimate aim for the employer to apply its policies fairly and consistently.

Given the particular policy in question – which emphasised the need to deal with each case on its own facts, and allowed for different treatment for those who were disabled – the fair and consistent application of that policy was not necessarily discriminatory.

In allowing the cross-appeal, the EAT considered whether being treated as entitled to a payment under the CSCS was capable of being unfavourable treatment and found that it was not as MM would have not received a payment if he was dismissed for a reason not relating to his disability.

Key take aways from this case

Employers tackling sickness absence issues can take some relief from this case.

Satisfactory levels of attendance and considering the impact of absences on colleagues and their morale were deemed by the EAT as legitimate aims the employer was entitled to consider when dismissing an employee for absence relating to a disability.

This is providing all reasonable adjustments have been made and alternative roles (where applicable) have been considered.

Employers will need to show that they have considered all relevant evidence (including medical advice) and followed a full and reasonable process before they proceed to dismiss employees on grounds of capability for absence.

However, it is to be noted that in this case:

  • HMRC had robust written policies in place including attendance management procedure. This is a policy which seeks to ensure staff are given reasonable support to return to work. Managers are told that each case is unique and they must use their discretion to make reasonable decisions in each case.
  • HMRC applied the policy flexibly in favour of MM
  • medical/OH reports were obtained
  • reasonable adjustments were made throughout the course of MM’s employment
  • HMRC enquired regularly whether any more adjustments were needed
  • regular contact was made even when MM was on sick-leave
  • alternative employment was considered (but none was available)
  • HMRC also had a paper-trail evidencing the above

Each business will operate differently, so it’s important to ensure the aim of the dismissal is specific to the needs of the business in question.

Then, it’s important to ensure the decision to dismiss is proportionate to achieving that aim.

This requires consideration of whether the aim might be achieved by a less discriminatory measure.

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Benjamin Brown
About the author

Benjamin Brown

Benjamin is the Digital Marketing Executive at Moorepay. He recently joined the team after graduating with an MSc is Advertising. He has experience in advertising, copywriting, content creation and marketing.