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Sick Pay and Disability Discrimination

It is often surprising, but true, that the most obvious legal questions are the ones that go unanswered for the longest time. One such question concerns sick pay and disabled employees. For how long should it be paid? What about discretionary sick pay schemes?

Following the case of O’Hanlon v HM Revenue & Customs, we can all breathe a collective sigh of relief. The Employment Appeal Tribunal (EAT) recently confirmed that it did not amount to unlawful disability discrimination to fail to pay a disabled employee full pay during sickness absence attributable to that employee’s disability. Ms O’Hanlon suffered from clinical depression, a disability within the meaning of the Disability Discrimination Act 1995 (the “DDA”). She benefited from quite generous contractual sick pay terms, which entitled her to a minimum of 6 months’ full pay and 6 months’ half pay in any 4-year period. However, by reason of the significant amount of sick leave that she took, by October 2002, Ms O’Hanlon had exhausted her entitlement to the more generous rates of contractual sick payment. When her sick pay was drastically reduced, and after having raised an internal grievance, this employee brought an Employment Tribunal claim against her employer.

Ms O’Hanlon claimed that in failing to pay her full pay during her entire period of sickness absence, the conduct of HMRC amounted to a substantial disadvantage in respect of which HMRC had failed to make a reasonable adjustment. She also claimed that the conduct of HMRC amounted to disability-related discrimination.

On appeal, the EAT said that it would be:-

“a very rare case indeed, where the adjustment said to be applicable here, that is merely giving higher sick pay than would be payable to a non-disabled person who in general does not suffer the same disability related absences, would be considered necessary as a reasonable adjustment.” As a result, Ms O’Hanlon’s appeal was unsuccessful. She also failed successfully to appeal the decision that the treatment she received amounted to disability-related discrimination. The EAT found that the decision not to pay the employee sick pay over and above what anyone else might be entitled to was justified in the circumstances. This is an important case, which now clearly sets out the principle that it will be a very rare case indeed, where a failure to pay a disabled employee sick pay over and above the normal sick pay rate will be regarded as unlawful.

For further enquiries please contact Nick Hobden (view full profile) on 01892 701326 or email nhobden@ts-p.co.uk.

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