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Disability discrimination: what counts as ‘unfavourable’ treatment?

The Equality Act 2010 protects employees from being treated ‘unfavourably’ because of something arising from their disability.

The Equality Act 2010 protects employees from being treated ‘unfavourably’ because of something arising from their disability.

But what does the term ‘unfavourably’ mean in this context? Can a benefit or payment given to a disabled person amount to ‘unfavourable’ treatment because that benefit would have been greater had the individual not suffered from a disability?

The Supreme Court in Williams v The Trustees of Swansea University Pension and Assurance Scheme grappled with this difficult question in the context of a disabled employee’s pension award. It concluded that the receipt by the employee of an enhanced pension payment, could not be regarded as ‘unfavourable’ simply because the degree of enhancement might have been greater in different circumstances. 

What happened?

The claimant in this case, Mr Williams, was a person with a disability who suffered from Tourette’s syndrome, obsessive-compulsive disorder, depression and other psychological conditions. He worked for Swansea University for 13 years, the first ten of which were full time. In the last three years, he dropped to half his full-time hours, as a result of reasonable adjustments agreed with him by the University, and his pay was reduced accordingly. Eventually, as a result of his medical conditions, Mr Williams took ill-health retirement from the University aged 38.

Under the ill-health retirement provisions of the University pension scheme, Mr Williams was entitled to:

  • A lump sum and annuity payable immediately, based on his accrued benefits, without any actuarial reduction for early receipt. The annuity and lump sum were calculated on the basis of his actual salary at the relevant times (whether full time or part-time); and
  • An enhancement to both his lump sum and annuity, again payable immediately and without any actuarial reduction for early receipt. The enhanced element was calculated on his actual salary at the date of retirement and a period of deemed pensionable service (as though he had continued working to the scheme’s ‘normal retirement date’ of 67).

This generous provision was described by an Employment Judge at an earlier hearing as “immensely favourable”. However, the claimant, Mr. Williams, alleged that these pension terms discriminated against him as a disabled person. The dispute related solely to the ‘enhanced’ element of the pension payment.

He contended that the reduced figure, calculated by reference to his part-time rather than full-time salary, constituted ‘unfavourable’ treatment because of ‘something arising in consequence of his disability’ (that is his inability to work full-time). He argued that, had he not had a disability, he would have been working full-time at his retirement date and received a bigger enhancement. Similarly, if he had become disabled very suddenly (following a heart attack or stroke) he would have been working full-time in the immediately prior period and the enhancement would have been based on full-time pay.

The decision

The Supreme Court rejected this argument and held that Mr Williams had not suffered any unfavourable treatment. The Court cautioned against an “artificial separation” between the way a payment (or part of a payment) is calculated, and the payment itself.

Much of the decision is dedicated to exploring the meaning of various other terms used in the Equality Act to denote unfavourable treatment (such as ‘detriment’ and ‘disadvantage’) and considering whether distinctions can be drawn between these concepts.

However, ultimately, the Supreme Court applied a simple two-step approach to this situation. Firstly, what was the relevant treatment? Secondly, was that treatment unfavourable to the claimant?

In this case, the ‘treatment’ under scrutiny was the award of a pension. There was nothing intrinsically unfavourable about this (in contrast with other possible circumstances where ‘treatment’ such as eviction or dismissal would clearly be intrinsically unfavourable to the individual). Mr Williams had not been treated ‘unfavourably’. He had not received a lower or lesser pension than if he had not been disabled. If he had not been disabled, and had been able to work full-time, his pension would not have been calculated on a more favourable basis. In fact, he would not have been entitled to any pension at all until the ‘normal retirement date’ of 67. Viewed in the round, the claimant’s pension terms clearly operated to protect his position and to confer a benefit on him.

The Supreme Court also dismissed Mr Williams’ argument that he would have been treated differently had his disability taken a different form (arising from a sudden event rather than a chronic condition). This comparison was not relevant to whether he had been treated unfavourably on the grounds of his disability.

What does this mean for me?

The judgment in this case engages with some of the most difficult concepts in disability discrimination law, such as the appropriate comparator to use to decide whether a disabled employee has been treated less favourably than his or her colleagues.

However, the key message emerging from the case is quite straightforward. In this context, an employment tribunal will take a common-sense view of whether an employee with a disability has suffered ‘unfavourable’ treatment. An employment tribunal will be reluctant to isolate one discrete element of a payment as discriminatory, where clearly a substantial benefit has been conferred on the employee with a disability overall. This case may make it less likely that the structure of a pension or other benefits package will be successfully challenged by employees.

However, it is important to treat this decision with care. The dispute in this case concerned a payment that the claimant would not have received at all had he not been disabled. He was only entitled to the payment in the first instance because he was unable to work due to health/disability. Where a payment or benefit is extended to all employees (whether disabled or non-disabled) it is still crucial to ensure that the terms of the offer do not discriminate in any way against recipients who have a disability (and if they do that any such treatment is justified).

The Supreme Court in this case viewed the benefits package ‘in the round’ and looked at the net benefit to the employee. While this is likely to shape an employment tribunal’s future approach to disputes involving similar pension and benefits packages, this ‘big picture’ approach might not apply to every scenario. For example, an employee might still be able to successfully argue that a particular provision of his or her employment contract is discriminatory, despite the fact that other terms and conditions in the same contract operate to the employee’s benefit.

Louise Singh (, is a Professional Support Lawyer, supporting the national Employment Pensions and Immigration team and is based in Liverpool. If you have any questions on this complex and nuanced area of law please do not hesitate to contact Louise or speak to your usual Weightmans advisor.

If you are in dispute with an employee regarding the terms of your pension scheme or would like to test whether your current pension arrangements will stand up to scrutiny, please get in touch with our Head of Pensions Mark Poulston ( for expert assistance.

For further guidance or support on any employment law issues, contact our employment law solicitors. We are able to give expert advice on defending employment tribunal claims and pensions law.