Costco Wholesale UK v Newfield

An employment tribunal must identify the pleaded provision, criterion or practice (PCP), or fairly redefine it after giving the parties an opportunity to address the change. It must resolve material evidence bearing on whether the asserted PCP existed and caused a substantial disadvantage.

Where substantial disadvantage is critically disputed, reasons must explain how the tribunal resolved the competing evidence. Under section 15 of the Equality Act 2010, the question is whether unfavourable treatment was because of something arising in consequence of disability, not simply whether it was because of the disability itself. A one-off discriminatory dismissal may properly fall within the middle Vento band. A lengthy general handbook does not necessarily satisfy the duty to provide person-specific written employment particulars.

The claimant, an optical adviser with lupus, alleged that Costco failed to make reasonable adjustments by requiring her to work excessive hours and by dismissing her after performance-related counselling notices. The Employment Tribunal upheld that claim, awarded £9,000 for injury to feelings, and awarded four weeks’ pay for failure to provide written employment particulars. It dismissed her claim for discrimination arising from disability.

Costco appealed the reasonable-adjustments finding, the injury-to-feelings award, and the award under section 38 of the Employment Act 2002. The central issues were whether the Tribunal had impermissibly reformulated the relevant PCP, adequately reasoned its finding of substantial disadvantage, and erred in making the maximum section 38 award.

1. Appeal allowed in part. The reasonable-adjustments finding was set aside and remitted to a freshly constituted Employment Tribunal. The injury-to-feelings award consequently also fell away. The appeal against the four-week award under section 38 of the Employment Act 2002 was dismissed.

2. The Tribunal had substituted a materially different PCP from that identified in the agreed issues. The pleaded case concerned a refusal to limit working hours after a request. The Tribunal instead found a requirement to work whatever hours appeared on the rota. That change mattered because evidence from the manager indicated that rota hours could be discussed and altered, and that the claimant had requested additional hours. The Tribunal neither resolved that evidence nor invited submissions on the changed PCP.

3. A tribunal is bound by the pleadings unless an amendment is granted. It may fairly redefine an issue derived from the pleadings as a case develops, but only after raising the matter with the parties and avoiding unfairness or injustice. Whether a PCP put a disabled employee with fatigue at a substantial disadvantage could not be decided without first determining whether the rota was compulsory or open to alteration.

4. The Tribunal’s conclusion on substantial disadvantage was not perverse: the claimant’s evidence, the medical material and the admitted disability could support it. But the issue was critically disputed. The Tribunal gave insufficient reasons to show how it had resolved evidence concerning the claimant’s earlier failure to attribute mistakes to fatigue, her CV, and the alleged requests for extra hours. A fresh Tribunal should hear the reasonable-adjustments evidence and make its own findings.

5. The Tribunal had also erred, albeit on a claim not within the appeal, in treating section 15 of the Equality Act 2010 as requiring treatment because of disability. The statutory question is whether treatment was because of something arising in consequence of disability.

6. A discriminatory dismissal, although a one-off event, may fall in the middle Vento band. The bands are guidelines, not fixed categories. Finally, a 90-page general handbook did not satisfy the person-specific requirements for written particulars under section 1 of the Employment Rights Act 1996. The Tribunal was entitled to make the maximum section 38 award.

• Employment Appeal Tribunal: allowed Costco’s appeal against the reasonable-adjustments finding and remitted it for a fresh hearing; dismissed the appeal against the award under section 38 of the Employment Act 2002.

• Employment Tribunal, Watford: judgment dated 24 August 2012. It upheld the reasonable-adjustments claim, awarded injury-to-feelings compensation and four weeks’ pay for failure to provide employment particulars, and dismissed the disability-discrimination and sexual-harassment claims.