Ross Brymer analyses a recent case relating to undertaking for severance pay.
In the recent case of Hill v Lloyds Bank Plc the employment appeal tribunal confirmed that an undertaking from an employer to provide severance pay to a disabled employee can, in certain circumstances, be considered a reasonable adjustment.
The case concerned an employee, Hill, with reactive depression, a condition which falls within the definition of disability under the Equality Act 2010 (the “Act”), who claimed to have been bullied and harassed by two of her colleagues during work hours. Hill wanted Lloyds to provide her with an undertaking that she would not be required to work with these two employees and that, if there was no alternative, she would be offered a severance package equivalent to redundancy. Hill claimed that she was placed at a substantial disadvantage resulting from the severe anxiety and fear she suffered from the possibility of having to work with these two individuals, which would not have been suffered by a non-disabled person. If Lloyds provided her with an undertaking on the terms detailed above, this would be a reasonable adjustment and the fear would be alleviated.
Lloyds refused to give the undertaking leading to Hill bringing a claim of failure to make reasonable adjustments under s.20 of the Act. The employment tribunal initially found that Hill was placed at a significant disadvantage as a result of her fear and ordered compensation for injury to feelings and a recommendation under s.124(2)-(3) of the Act that Lloyds provide an undertaking on the terms detailed above. However, when the employment tribunal reconsidered the case it determined that it was unreasonable for Lloyds to give an undertaking requiring remuneration when it was not possible to specify a deadline for compliance.
The case was referred to the employment appeal tribunal (“EAT”) which found that in principle there is no reason why it could not be considered reasonable for an employer to give an undertaking to a disabled employee to provide a specified benefit if particular circumstances arise. In these circumstances the undertaking would allow Hill to work without fear and had the intention of allowing Hill to continue working. The original drafting of the undertaking stated that Hill would not be required to interact with the two individuals “in any capacity” and that if she did then Lloyds would use “all reasonable endeavours” to procure an alternative form of employment. This was considered too vague and therefore the EAT set aside the original recommendation of the tribunal.
The key takeaway for employers is that in certain circumstances it may be necessary to consider giving a disabled employee an undertaking with financial consequences based on future possible events as a reasonable adjustment. In such situations we strongly recommend you obtain legal advice on what adjustments should be considered and how any such undertaking should be worded.