Compromise Agreements Ltd, R (On the Application Of) v Secretary of State for Business, Innovation And Skills

In judicial review, compliance with the formal time limit does not necessarily make proceedings prompt. The court may consider earlier knowledge of the proposed measure, delay before issuing the claim, the consultation history and prejudice to good administration.

The public sector equality duty in section 149 of the Equality Act 2010 requires due regard, but not a minute examination of every possible impact. The inquiry is contextual, and reasonableness and proportionality are relevant. Consultation and an equality impact assessment addressing protected characteristics and explaining limits in the available data may satisfy the duty. Weak merits and delay will not ordinarily justify permission on wider justice grounds.

Compromise Agreements Ltd sought judicial review of the Unfair Dismissal (Variation of the Limit of Compensatory Award) Order 2013, which limited an unfair dismissal compensatory award to the lower of £74,200 or one year’s pay. The challenge relied on section 149 of the Equality Act 2010; an alternative challenge under Article 1 Protocol 1 was abandoned.

The proceedings were commenced within the three-month period but were held insufficiently prompt because the proposed changes and criticisms of the consultation had been known earlier. Eder J refused permission on the papers, and Blake J refused it at an oral hearing on 13 May 2014. A prior paper application to the Court of Appeal was refused by Sir David Keene on 28 January 2015. The renewed application concerned delay, the strength of the section 149 challenge and whether there was a compelling reason to grant permission.

The renewed application for permission to appeal was refused.

1. Promptness and good administration. Although the proceedings were commenced within three months of the order coming into force, that did not resolve whether they were brought promptly. The court could consider the earlier consultation, the publication of the draft order, the applicant’s asserted awareness of the proposals in early 2013, the absence of a pre-action letter and the delay in issuing the claim. Blake J was entitled to conclude that a procedural challenge requiring the consultation process to begin again could prejudice good administration. His reasoning was sufficient, and his discretion had not been exercised on a wrong basis or otherwise flawed.
2. Due regard. The only surviving merits issue was whether the Department had failed to have due regard to the public sector equality duty under section 149 of the Equality Act 2010. The consultation materials expressly addressed the duty. The final impact assessment and annexed equality assessment considered protected characteristics, recorded the limitations of the available data and addressed concerns about older and younger workers and disabled people. The material before the court did not establish that the Department was required to undertake a more extensive investigation, including a speculative manual review of employment tribunal claims and decisions.
3. Extent of inquiry. Public bodies are not required to undertake a minute examination of every possible impact or ramification. Reasonableness and proportionality are relevant to the assessment. The evidence was insufficient to show that the Department’s consideration was not due.
4. Compelling reasons. The potentially affected class was small, reliable statistics were unavailable and the proposed claim had insufficient prospective merit. The wider interests of justice therefore did not justify permission. The court was not concerned with whether the policy was good or bad; absent a viable section 149 challenge, Parliament’s decision stood.

• Court of Appeal (Civil Division): Lord Justice Davis refused the renewed oral application for permission to appeal on 19 May 2015.
• High Court of Justice, Queen’s Bench Division: Eder J refused permission on the papers. Blake J refused permission at an oral hearing on 13 May 2014, relying principally on delay and also on the weakness of the proposed merits challenge.
• Court of Appeal (Civil Division): Sir David Keene refused an earlier paper application for permission on 28 January 2015.