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Cost as a justification for discrimination

Posted on 31st January 2011
Case law

Cases have previously concluded that cost can only ever justify discrimination in conjunction with another factor. The EAT has cast doubt on this position.

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Julie Temple Julie
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Woodcock v Cumbria Primary Care Trust 2010

Background

Mr Woodcock was a Chief Executive of an NHS Trust in Cumbria. As a result of a reorganisation the number of PCT's (and therefore Chief Executives) reduced from 42 to 24 in the North West. Mr Woodcock occupied one of the posts lost.

He was however seconded on a temporary basis to the Strategic Health Authority from February 2006. In March 2007 the Trust attempted to arrange a meeting to consult with Mr Woodcock about his potential redundancy. Before the consultation meeting took place the Trust gave 12 months' notice of dismissal. The main reason for this decision was that Mr Woodcock was shortly to turn 49 and if notice was not given to him he would be 50 at the date of dismissal and entitled to early retirement, potentially costing the Trust in excess of £500,000. There was also an additional consideration taken into account by the Trust that Mr Woodcock's post as Chief Executive was redundant and no alternative employment found.

The decision

The decision was that the issuing of notice prior to the consultation meeting was justified and not discriminatory. The key aspect of this case, however, although not binding in other cases are comments made by the EAT in reaching its decision. The EAT commented that it saw no reason why costs 'can never by themselves constitute justification'. This casts clear doubt on the current position which requires costs to be considered in conjunction with other factors.

In practice

This case, in our view, adopts a perfectly sensible approach to 'justification' of discrimination. The decision recognises that 'in many cases the discriminatory impact . . . may be such that an employer must avoid or correct it whatever the costs . . . equally . . . where the impact is trivial and the cost of avoiding it or correcting it is enormous . . . we cannot see why the principle of proportionality should not be applied in the ordinary way'.

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