Brash-Hall v Getty Images Ltd

The Court of Appeal considered remedies following findings at first instance that the appellant had been wrongfully and unfairly constructively dismissed and subjected to direct sex discrimination under the Sex Discrimination Act 1975. The principal legal question was whether the Employment Tribunal erred in assessing compensation by focussing on statutory redundancy entitlement under section 141 of the Employment Rights Act 1996 rather than on the contractual/severance package which the respondent had held out as being available.

The Court applied the Cannock principle (compensation assessed so as to put the claimant in the position she would have been in but for the discrimination) and distinguished between (a) the contractual entitlement to pay in lieu of notice, which was unconditional, and (b) the enhanced severance payment, which was conditional on signing a severance agreement and was not established on the evidence. The Court therefore allowed the appeal in part: it increased the discrimination award to include three months' pay in lieu of notice from 1 November 2003 (less the seventeen days already awarded), but refused to award the enhanced, conditional severance payment because the appellant had not proved she would have accepted the severance agreement.

Background and parties. The appellant, Mrs Brash-Hall, was employed by Getty Images Limited and took maternity leave from 13 February 2003. A vacancy was filled temporarily and, after representations about an earlier restructuring, the respondent carried out a genuine reorganisation effective 1 November 2003. The appellant resigned on 8 August 2003 and alleged constructive, wrongful and unfair dismissal and sex discrimination.

Procedural history. The Employment Tribunal found for the appellant on unfair dismissal, direct sex discrimination and wrongful dismissal. On remedy the Tribunal awarded a limited period of loss (one week maternity pay and three months' pay from 18 August) and injury to feelings. The appellant unsuccessfully appealed on part of the remedy to the Employment Appeal Tribunal and obtained permission to appeal to the Court of Appeal.

Nature of the claim and relief sought. The appellant sought compensation to put her in the position she would have occupied but for the unlawful conduct. In particular she contended she would have remained employed until the genuine reorganisation at the end of October 2003 and, if made redundant then, would have received the respondent's severance package (three months' contractual notice plus three months enhanced severance).

Issues framed by the court. The Court addressed whether the Employment Tribunal was wrong in law to: (a) treat the matter as one of statutory redundancy entitlement under section 141 ERA 1996 rather than as a question of what severance package would have been offered; and (b) omit the contractual pay-in-lieu and/or enhanced severance from the discrimination award.

Court’s reasoning and decision. The Court of Appeal held that assessment of discrimination damages follows the Cannock approach and requires the Tribunal to consider what the employee would have been offered absent the discrimination. The Court concluded that the Tribunal had inappropriately focussed on statutory redundancy entitlement under section 141 ERA 1996 and had overlooked that pay in lieu of notice was a contractual entitlement not conditional on signing a severance agreement. The enhanced severance payment, by contrast, was expressly conditional on signing a standard severance agreement; there was no evidence the appellant would have accepted that agreement, so awarding the enhanced payment would have required impermissible speculation. For those reasons the Court allowed the appeal in part and increased the award to include the three months' pay in lieu of notice (less seventeen days already covered), but did not award the conditional enhanced severance. The Court declined to remit the issue of acceptance of the severance agreement to the Tribunal because of proportionality and evidential difficulties.

Appeal allowed in part. The Court allowed the appellant's appeal only to the extent of increasing the discrimination award to include three months' contractual pay in lieu of notice from 1 November 2003, less the seventeen days already included in the Tribunal's award (an additional ten weeks and five days to 31 January 2004). The Court refused to award the enhanced severance payment because it was conditional on signing a severance agreement and the appellant had not established she would have accepted those terms; the Tribunal had erred by concentrating on statutory redundancy entitlement under section 141 ERA 1996 rather than on what would have been offered, but the conditional element required evidential proof which was absent.

Appeal to the Employment Tribunal (London Central), which found for the claimant on liability. Appeal on remedy to the Employment Appeal Tribunal was unsuccessful. Further appeal to the Court of Appeal, reported here as [2006] EWCA Civ 531.