Is pay protection a legal requirement where a disabled employee moves to a lower paid role as part of reasonable adjustments?
Prior to the case of G4S Cash Solutions v Powell 2016, case law had suggested that the duty to make reasonable adjustments now under section 20 Equality Act 2010 did not usually extend to pay related matters as the rationale was that adjustments were more related to the role or to provide another role to accommodate the employee’s disability and thus not related to pay protection unless there were exceptional circumstances. See O’Hanlon v HM Revenue and Customs UKEAT/0109/06.
Employment tribunal
The G4S case changed things, where Employment Appeal Tribunal (EAT) decided that maintaining the disabled employee’s higher rate of pay was a reasonable adjustment where the employee moved to a lower paid role. There were certain factors as follows;
- It was part of a package of measures to keep the employee in work where he was doing the lower paid role for more than 12 months
- He was unaware that the role and higher rate of pay was temporary and only told after a period of 12 months plus in that role that the employer would only be prepared to employ him in that role at a reduced rate of pay and when the employee refused to accept these terms he was dismissed.
The (EAT) referred to the case of Archibald v Fife Council [2004] ICR 954 that suggested that the duty to make reasonable adjustments may require the employer to treat an employee more favourably than others. However the (EAT) did highlight that such an adjustment would not be an "everyday event" as factors like the cost of the adjustment, what the employee had been told or led to believe about the duration of the adjustment would be relevant to determine if there were good reasons for maintaining pay protection.
The (EAT) have now readdressed matters in this area and decided in the case of In Aleem v E-Act Academy Trust 2021 that it was not a reasonable adjustment to continue to pay an employee at her previous higher rate of pay as a teacher when because of her disability due to mental health she was moved to a different lower-paid job as a cover supervisor on a permanent basis.
Reasonable adjustment to maintain the higher rate of pay maybe an option on a temporary basis for doing a lower paid job as long as it is made quite clear to the employee at the time of the offering the adjustment that it is temporary and that if made permanent will be paid at lower rate of pay. Where the employee raises a grievance before the permanent change is to take effect it is good practice to continue with higher rate of pay until the grievance is fully addressed.
Employment Law
This area of employment law is quite contentious and likely to turn on its own facts and the Employment Tribunal are likely to consider all the relevant circumstances of the case as to what a reasonable employer should be doing. They will take into account, amongst others things, practicability of the adjustment, what the employee was told, costs (as in Aleem case, keeping the employee on her teacher salary indefinitely was a substantial cost to the school, against the backdrop of a publicly funded institution facing some financial pressures), service delivery and business efficiency.
Please note that this article is for information purposes only and should not be relied upon as being authoritative on the matter however further guidance on the matter can be provided by contacting our HR/legal advice-line on 01455 852028.
