A recent case has identified how an employer can get into trouble if they withhold bonus payments from staff because of their health record. The Land Registry operated a bonus scheme which paid out £900 to eligible employees during 2012. One of the key planks of the scheme was that any employee who had received a formal warning in respect of sickness absence during the relevant financial year became ineligible to receive the payment. 5 employees who were disabled within the meaning of the Equality Act and had accrued sickness absence because of their disabilities challenged their exclusion from the bonus payment, arguing that they had been treated unfavourably because of something arising in consequence of their disabilities which fell within Section 15(1) of the Equality Act 2010, arguing that such treatment could not be objectively justified.
The employees were successful, both at the original Tribunal and at the Employment Appeal Tribunal. Whilst the Tribunal noted that the Land Registry had already made reasonable adjustments to assist the individuals in overcoming their disabilities, and had adjusted the usual trigger points at which the sickness warning procedure became engaged, they noted that whereas a manager might have discretion to award somebody who had had a warning for misconduct a bonus, the manager had no discretion when it came to a warning for sickness absence, which seemed anomalous. The Tribunal was clear that the link between a person’s disability and being excluded from the bonus was clear, so it fell to the employer to argue why it was objectively justified to do this. When it came to objectively justifying this, the EAT agreed with the original Tribunal that the employer had failed. The Tribunal had taken into account that no credit was given for any improvement in attendance following a disciplinary warning which made it a disproportionate means of achieving the legitimate aim of rewarding good performance and attendance.
It is clear to see, from this case, that it is very important that, whilst you do have rules and structures in place, managers must have a discretion to be able to treat cases on a case by case basis and to consider all the relevant circumstances.