Heskett v Secretary of State for Justice

The court confirmed that an employer cannot rely on cost alone as a legitimate aim to justify indirect age discrimination. Rather, an employer may legitimately rely on a fair allocation of limited resources or an absence of means where those aims are real and objectively justified. Tribunals must weigh the employer's real needs against the discriminatory effect and may consider temporal factors and active steps to mitigate discrimination when assessing proportionality.

The appellant, a Probation Officer, challenged an Employment Tribunal's finding that a revised pay progression policy was justified as a proportionate means of achieving a legitimate aim under Equality Act 2010 s.19(2)(d). The Tribunal had found a prima facie age-based disparate impact in favour of older employees but concluded the policy was justified. The claimant appealed on three grounds, asserting the policy was driven solely by cost, that recognition of the discriminatory effect and plans to change did not assist justification, and that there was no evidential basis to infer a temporary intent. The EAT heard argument and reviewed the Tribunal's approach to legitimate aims and proportionality.

(1) Appeal dismissed. The Tribunal's conclusion that the Respondent's pay progression policy was justified was within its evaluative judgment and not perverse.

(2) The court reaffirmed that cost alone cannot supply a legitimate aim for justifying indirect age discrimination. [Woodcock v Cumbria PCT [2012] EWCA Civ 330] remains binding on that point.

(3) There is a lawful distinction between an impermissible reliance on cost alone and legitimate decisions driven by an organisation's need to live within available means or to allocate limited resources fairly. The latter may constitute a legitimate aim where supported by evidence and weighty reasons. The Tribunal was entitled to treat the Respondent's aims as including retention of incentive, reward for loyalty and experience, avoiding redundancies and preserving accrued rights.

(4) In assessing proportionality tribunals must weigh the employer's real need against the discriminatory impact. Temporal considerations and evidence of active steps to mitigate discrimination are relevant to the "no more than necessary" limb of the test. The Tribunal properly took account of the respondent's intention and steps to shorten the pay scale when evaluating whether the means were proportionate.

(5) The Employment Appeal Tribunal therefore declined to interfere with the Tribunal's findings that the policy, as then constituted, was a proportionate means of achieving legitimate aims. The appellant's grounds alleging legal error in distinguishing cost and inferences about temporariness failed.

(6) Result: the appeal is dismissed.

• Employment Appeal Tribunal: Appeal dismissed (25 June 2019).
• Employment Tribunal (Ashford): Found policy prima facie discriminatory but justified; written reasons provided September 2017.
• Permission to appeal: Granted by HHJ Eady QC under Rule 3(10).