R (Adiatu) v Her Majesty's Treasury

This judicial review challenged Treasury decisions made in response to the COVID-19 pandemic: principally the exclusion of most "limb (b)" workers from the Coronavirus Job Retention Scheme (JRS), the treatment of such workers under the Statutory Sick Pay (SSP) regime (including the continuing application of the lower earnings limit (LEL) and the level of SSP), and alleged failures to comply with the public sector equality duty (s 149 Equality Act 2010) and EU and ECHR anti-discrimination protections.

The court applied established tests for discrimination claims: Article 14 read with A1/P1 under the Human Rights Act (with justification assessed against a wide margin of discretion/MWRF principles as developed in domestic authority), the EU law test for indirect discrimination (PCP placing a protected group at particular disadvantage unless objectively justified), and the procedural requirements of the PSED. Key statutory provisions considered included the Treasury Direction establishing the JRS under the Coronavirus Act 2020, and provisions governing SSP in the Social Security Contributions and Benefits Act 1992 (notably ss 151, 155, 157 and s163 and Sch.11 on the LEL).

The court concluded that (i) exclusion of limb (b) workers outside PAYE from the JRS was justified given the aims, speed and deliverability of the scheme; (ii) exclusion of most limb (b) workers from SSP, the retention of the LEL and the existing rate of SSP during the emergency were not unlawful — they were within the Government's margin of discretion and had reasonable foundations; (iii) the EU indirect discrimination claims failed (the SSP rate was not a PCP and other PCPs were justified on proportionality grounds); and (iv) the Treasury had not breached its PSED in relation to the measures implemented. The claim for relief was dismissed.

Background and parties. The claimants were Mr Ahmed Adiatu and the Independent Workers Union of Great Britain (IWGB). Mr Adiatu is a limb (b) private hire driver with leave to remain subject to "no recourse to public funds" whose earnings fell sharply during the lockdown. The IWGB brought the challenge in the public interest on behalf of vulnerable workers whose incomes were affected by pandemic restrictions.

Nature of the claim and relief sought. This was a judicial review seeking declarations that Treasury decisions about the JRS and SSP (including the LEL and the SSP rate) were unlawful: (a) discriminatory contrary to the European Convention on Human Rights (Article 14 read with A1/P1); (b) discriminatory under applicable EU law (indirect race and sex discrimination); and/or (c) taken in breach of the public sector equality duty (s 149 Equality Act 2010). The claim did not seek quashing orders but asked the court to require the Defendant to review and remake decisions.

Issues before the court. The court framed the issues as: (1) whether exclusion of limb (b) workers from the JRS amounted to unjustified differential treatment under Article 14/A1P1; (2) whether SSP changes (and the LEL and SSP rate) were discriminatory under ECHR or EU law; (3) whether the Defendant complied with the PSED in adopting the emergency measures; and (4) subsidiary procedural questions (standing, appropriate forum for EU/pay claims, and the standard of review / margin of discretion applicable to emergency social and economic measures).

Reasoning on Article 14 / A1P1. The court accepted that the pandemic and lockdown were extraordinary, that government decision-making required very rapid policy choices, and that the executive was entitled to a wide margin of discretion when allocating large public resources. Comparing limb (b) workers outside PAYE with PAYE workers, the court held the groups were analogous only to an extent; the decisive question was justification. Applying the relevant standard of review (informed by DA, Drexler and ECtHR authorities), the court concluded that confining the JRS to those in the PAYE system was justified by legitimate aims of the JRS (supporting employer/employee relationships, administrability and fraud prevention) and by the need for a simple, rapidly deliverable scheme. The exclusion was therefore not unlawful under Article 14 read with A1P1.

Reasoning on SSP and LEL. The court found limb (b) workers and PAYE workers were more analogous in the SSP context than for the JRS, but nonetheless held the decision not to extend SSP to all limb (b) workers had a reasonable foundation. SSP is historically employee-centred and its rapid amendment to respond to COVID-19 required bright-line rules deliverable at short notice; extending SSP to non-PAYE limb (b) workers would have required fundamental redesign, posed severe practical and fraud risks, and could not be implemented speedily. The court applied the MWRF approach to benefits-style measures and concluded the retention of the LEL and the SSP rate were within the Government's margin of discretion and proportionate in context.

Reasoning on EU discrimination claims. The court analysed indirect discrimination principles (PCP, particular disadvantage, objective justification). It rejected the contention that the SSP level itself was a PCP causing particular disadvantage. It accepted that the LEL and PAYE-only eligibility are PCPs and assumed (without deciding on BAME data gaps) that they could place women and some BAME groups at a particular disadvantage, but held that in the fast-moving emergency context the Government's aims were legitimate and the means chosen were proportionate, given alternative schemes (SEISS, Universal Credit changes, loan schemes) and the practical exigencies of rapid delivery.

Reasoning on PSED. The court held the PSED applies to preparatory decision-making leading to delegated legislation and to policy decisions of departments, but not to the process of promoting primary legislation in Parliament. The court found the Treasury and relevant departments had given adequate, proportionate consideration to equality impacts (EIAs and ministerial submissions showed regard to protected groups), and rejected the claim that the PSED required exploration of every alternative not in active contemplation. The PSED challenge failed on the facts.

Procedural and standing points. The court accepted that judicial review was an appropriate route given the public law nature and urgency of the challenge and permitted the IWGB to proceed despite potential standing objections, considering the union's public interest role and urgency of litigation.

The claim is dismissed. The court held that (1) exclusion of limb (b) workers outside PAYE from the Job Retention Scheme was justified by legitimate aims of rapid deliverability, administrability and fraud avoidance and fell within the Government's wide margin of discretion; (2) exclusion of most limb (b) workers from SSP, retention of the lower earnings limit and the SSP rate were likewise not unlawful and had a reasonable foundation in the emergency context; (3) the EU indirect discrimination complaints were not made out on proportionality grounds; and (4) the Defendant complied with the public sector equality duty in the decision-making it actually undertook.