Hall v Xerox UK Ltd (Fixed Term Regulations)

For a claim under regulation 3(1)(b) of the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002, the tribunal must identify, in a practical and robust sense, the cause of the alleged detriment. It is not required to treat every earlier event as its cause. A factual finding that an insurer's refusal, rather than an act or deliberate omission of the employer, caused the outcome will stand unless perverse or legally erroneous.

An insurer providing benefits under an insurance contract is not thereby the employer's agent. In any event, less favourable treatment may be justified where the employer pursues the legitimate aim of providing income protection at annual-premium cost and the evidence supports a finding that no realistic non-discriminatory insurance alternative was available.

The claimant was employed on successive fixed-term contracts. His employer provided income protection through an insurance policy. The insurer refused his claim because, at the time of his injury, his contract was due to expire before the qualifying period, although it was later extended.

The Employment Tribunal dismissed his claim under the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002. The Employment Judge, exercising a casting vote, held that the insurer's decision caused the disadvantage. The lay member considered that the employer should have arranged non-discriminatory cover. The claimant appealed, challenging causation, agency, contracting out, and justification.

1. Appeal dismissed. The Employment Judge was entitled to find that the less favourable outcome was caused by the insurer's refusal to pay, rather than by an act or deliberate failure to act of the employer for the purposes of regulation 3(1)(b).

2. Causation under regulation 3(1)(b) is a factual question. A tribunal must identify the cause in sensible, practical and robust terms. It need not include every event that could be described as a cause. The policy did not itself impose a criterion analogous to a facially neutral criterion that inherently discriminates; the relevant refusal was the insurer's decision.

3. The insurer was not the employer's agent under regulation 12(2). It was a commercial insurer contracting with the employer. It did not act on the employer's behalf to create relations with others or fulfil an obligation owed by the employer to its employees. The contract's effects upon employees did not convert the insurer into an agent.

4. There was no tenable case that the employment contract contracted out of the Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations 2002. Nothing in it expressly or implicitly prevented the claimant from asserting rights under the Regulations.

5. In any event, the Tribunal was entitled to uphold justification. The employer's aim was to provide income protection without incurring more than the cost of an annual premium. On the evidence, it could find that substantially identical restrictions were the apparently universal insurance-market approach and that no realistic alternative policy had been shown. Later renegotiation or payment after the refusal could not justify or invalidate the earlier contractual arrangements.

• Employment Appeal Tribunal: dismissed the claimant's appeal and upheld the Employment Tribunal's dismissal of the claim.
• Employment Tribunal: dismissed the claim in reasons given on 30 October 2013. The Employment Judge exercised a casting vote after disagreement with the lay member.