Smith v Gartner UK Ltd

An employment tribunal may strike out a claim only where it has no reasonable prospect of success. It must proceed cautiously, especially where material facts are disputed. Where the dispute turns solely on contractual documents and the relevant evidence is undisputed, strike-out may nevertheless be appropriate.

Whether permanent-health benefits are an employer’s contractual payment obligation or an obligation to provide insurance depends on an objective construction of the employment documents. A benefit described as insurance, subject to scheme rules, will ordinarily be an obligation to provide the insurance rather than to guarantee payments. A difference arising from the applicable insurer’s scheme rules is not direct age discrimination by the employer unless it is caused by age.

The Claimant had received permanent health/disability insurance benefits from 2003. Her benefits ceased when she reached 60, the retirement age under the scheme applicable when she entered benefit.

The Reading Employment Tribunal struck out her claims for unlawful deductions from wages and direct age discrimination. It held that the Respondent’s contractual obligation was to provide insurance, not to make disability payments itself.

On appeal, the Claimant contended that the benefits guide imposed a direct contractual payment obligation, that a 2007 communication varied her entitlement to age 65, and that the Respondent had discriminated in relation to her employment terms under Equality Act 2010.

1. Appeal dismissed. The Employment Tribunal was entitled to determine the strike-out application on written submissions. The dispute concerned the construction of documents, and the Claimant had not identified a factual dispute concerning the Respondent’s evidence.

2. The high threshold in Rule 37 remained applicable. Strike-out requires caution and is generally inappropriate where material facts require resolution. Here, however, the Tribunal could properly conclude that the claims had no reasonable prospect of success.

3. Assuming in the Claimant’s favour that the benefits guide formed part of her contract, its objective construction did not impose an obligation on the Respondent to pay long-term disability benefit. The documents repeatedly described the benefit as permanent health/disability insurance, stated that benefits were subject to applicable rules, and explained that the insurance was supplied at no cost. The reference to a percentage of salary identified the level of insured benefit; it was not an undertaking to continue salary.

4. The Respondent’s contractual obligation was therefore to provide insurance subject to the policy rules. The applicable scheme provided for cessation at age 60. The general 2007 communication did not establish a realistic case that the Claimant’s existing contractual entitlement had been varied. Nor did later documents establish that she had entered a new scheme with benefits to age 65.

5. The direct age discrimination claim consequently failed. The Respondent had not failed to make payments contractually due from it. The Claimant’s exclusion from the later scheme arose because she was already receiving benefit under the earlier policy and did not satisfy the new scheme’s qualifying conditions, not because of age. The unadvanced argument under Section 39(2) of the Equality Act 2010 could not alter that conclusion.

• Employment Appeal Tribunal: appeal dismissed in [2016] UKEAT 0279_15_0803.
• Employment Tribunal (Reading): by a judgment sent on 24 June 2015, struck out the claims for unlawful deductions from wages and direct age discrimination.