Most employers are well aware of the adverse repercussions of a discrimination claim. Many will realise that the compensation that can be claimed can be unlimited.
Some will understand that the Tribunal uses guidelines to determine the amount of the injury to feelings award. All would be forgiven for not understanding how the extent of their liability in light of a recent decision of the Employment Appeal Tribunal.
In the long established case of Vento v Chief Constable of West Yorkshire Police in 2003, the Court of Appeal set down some guidelines for Tribunals to use when calculating the level of an injury to feelings award in a discrimination claim. Three bands were set according to the seriousness of the incident(s). The first was £500 - £5000 involving one off acts or isolated incidents. The second was £5,000 - £15,000 (for serious cases) and the highest band reserved for very severe cases involving a lengthy campaign of sexual or racial harassment warranting awards of between £15,000 – £25,000. Only in exceptional cases was an award in excess of £25,000 to be made. As time went on, the same bands were deemed to apply in respect of successful whistleblowing applicants.
Six years later the case of Da’Bell v RSPCA concluded that the bands should be revised and reflect the real value of money at the date of the decision. By 2009, inflation had ravaged the real benefit to the individual. The bands were therefore increased to £1,000 - £6,000, £6,000 - £18,000 and £18,000 - £30,000.
One recession and a very low inflation rate later, the question arose again in Simmons v Castle in 2013. Simmons involved a personal injury claim brought in the courts, rather than the Tribunal, as a result of which a decision was made that with effect from 1 April 2013, "the proper level of general damages in all civil claims for (i) pain and suffering, (ii) loss of amenity, (iii) physical inconvenience and discomfort, (iv) social discredit, (v) mental distress, or (vi) loss of society of relatives, would be 10% higher than previously" As injury to feelings represented a payment for pain and suffering the EAT concluded that the 10% uplift applied to injury to feelings awards in the tribunal as well. This was confirmed by two further cases in the Employment Appeal Tribunal - Cadogan Hotel Partners Ltd v Ozog and Sash Window Workshop Ltd and anor v King. The President of the EAT also provided a guidance note confirming this to be the position in March 2014.
However, in a recent contradictory decision, the EAT in Chawla v Hewlett Packard Ltd has decided that the 10% increase set out in Simmons v Castle does not apply to Employment Tribunal claims. As such we have contradictory decisions on how to calculate such awards in the Tribunal, the latter of which is likely to be deemed to take precedence. Employers also now face the situation whereby if the employee sustains personal injuries as a result of an act of discrimination they would be awarded different amounts for the same injury depending on which venue they chose to pursue their claim in. A free-standing claim for personal injuries may be better brought in the court, rather than the tribunal to take advantage of the 10% uplift.
If you would like to discuss any issues raised in this article, we have specific employment law expertise in advising in this area. For further advice, please contact Angela Gorton
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