40. Supplementary memorandum submitted by Confederation of British Industry


How does disability fit within a single Equality Act?


We are sympathetic to the Government's intentions in the Equality Bill to simplify and streamline legislation across the different equality strands. The technical knowledge required of HR managers and SMEs to understand and comply with the multitude of regulations related to different equality strands is vast and costly. Disability discrimination has until now differed from the other strands due to the lack of an indirect discrimination definition - the more targeted disability-related discrimination being preferable. We have acknowledged that there is an obvious attraction to aligning the forms of disability discrimination with the other strands in the Equality Bill; however, this standardisation may have the converse effect of creating further complexity for employers.


What lessons should the Government learn from the Malcolm case?


Many of our members have highlighted the issue of comparators as one to be clarified as a result of the Malcolm case. The ODI acknowledges in its consultation document on indirect discrimination that disability differs from some other protected characteristics in that disabled people are not a homogeneous group. Proving that a neutral provision, criterion or practice puts disabled people at a disadvantage - as required under the definition of indirect discrimination - would depend heavily on the comparator chosen by a tribunal. We believe that determining these appropriate comparators will be fraught with difficulty in a post-Malcolm environment.


Recent high profile cases highlight the difficulty in proving group disadvantage and anticipating the comparator that would be used by the tribunal. Eweida v British Airways, for example, failed to show indirect discrimination due to the use of a wider group comparator. The tribunal did not use as a comparator a group who shared Miss Eweida's particular belief about the wearing of a crucifix; instead the tribunal used followers of the wider Christian faith and judged that Christianity, in general, does not require the crucifix to be worn at all times. The ODI suggested that had Mr Malcolm been able to allege indirect discrimination in his tribunal application, his case would have had more merit. The Eweida v British Airways case, however, shows that the choice of comparator remains crucial to the success of the case and there is little evidence that the judgment in Mr Malcolm's case could have been drastically altered. The tribunal panel would still have to choose how specific an impairment group to take as comparator. In consultation, our members observed that other people with a similar disability to Mr Malcolm - perhaps with varying degrees of severity - would have been able to understand the sub-letting regulations. This dilemma is reflected in the Eweida case: is the group comparator Christians in general or a particular sub-denomination? It will take some time for a sufficient body of case law to interpret these questions if indirect discrimination in disability cases was introduced, whilst employers and disabled people would remain uncertain about their rights and responsibilities.


Is indirect discrimination the appropriate concept to include, or would it be better to have a modified version of the disability-related discrimination concept?


The move from disability-related discrimination to indirect discrimination has not been initiated proactively by the Government. The Equalities White Paper, released in June 2008, advocated the retention of disability-related discrimination and the unique character of the DDA legislation. Instead, the Malcolm judgment has forced a change to an interpretation that had been widely accepted since the Clark v Novacold judgment. The speed at which the ODI conducted its consultation has left many questions unanswered about how indirect discrimination would operate in practice. Our members have highlighted concerns and raised questions about group comparators, objective justification and reasonable adjustment by anticipation - all areas that will require understanding and compliance from employers in order to operate effectively. In this sense, the move to indirect discrimination might result in a more complicated and technical set of regulations for employers to unravel and comprehend - something which is not adequately reflected in the regulatory impact assessment.


However, any discussion on the merits of adopting the concept of indirect discrimination seems, from the language of the consultation, almost redundant in light of the EU draft directive on non-discrimination. If the directive is transposed in its current form by the UK, there will be no option but to incorporate indirect disability discrimination. In this regard, the pertinent question is whether there is any room or need for disability-related discrimination in the legislative spectrum. Would there be any merit in keeping it, in some form, on the statute books? Our members have expressed concern about this possibility and we would reiterate that clarity of understanding and ease of implementation should remain priorities for the ODI. The pre-Malcolm interpretation of the DDA was widely understood and familiar to employers and employees alike, not to mention more effective in its protection of disabled people: in this light, the reversal of the Malcolm judgment might be the preferred option.


Do you think that implementing the Coleman case (extending coverage to association and possibly perception of disability) could help to move the current definition more to the social model approach to disability?


The aims of rulings of this nature are to assist those who are disadvantaged and to improve their access, engagement and fair treatment within society: this case clearly illustrated that no one should feel that they have to accept degrading treatment due to their relationship with a disabled person. However, we need to stress that the implications of this case go further. We are concerned with the risk of 'scope creep' in harmonising the other equality strands to include discrimination by association and perception, and how employers would cope with the implications. The reality is that the Coleman judgment, in extending the realm of associative discrimination, creates questions about how close the association has to be with the disabled party in order to gain discrimination rights under this legislation. Presumably, greater specification would be necessary, particularly in the areas of:

the level of care given;

the relationship with the disabled person being cared for;

who determines the status of the relationship.

The Department for Work and Pensions needs to set out clearly how the Equality Bill would define these elements.


Our members have expressed concerns about the implications that an extension of discrimination by association would have on UK flexible working regulations. When granting requests, employers might have to give priority to parents of disabled children over parents of non-disabled children, and to carers of disabled people over carers of non-disabled people. There could be a greater risk of accusations of discrimination if individuals consider that they are refused or treated less favourably in relation to a request made for a disabled person. The same situation would potentially arise in relation to carers of elderly people through age discrimination by association. However, provided that an employer can demonstrate that accepting a particular request would prove detrimental to the business, claims of discrimination by association would still fail because the operational requirements were such that no request would have been agreed. On this point, the law would remain unchanged; however, employers will require detailed and unequivocal guidance from the Government on their responsibilities.


Coleman certainly has implications for the provision of discrimination by association, but the extent to which then judgment could or should change the definition of disability is highly questionable. Equality for disabled people frequently requires reasonable adjustments on an individual case-by-case approach to achieve a fair outcome. The legal definition of disability - together with the concept of reasonable adjustment - was designed to ensure that the wide range of disabilities and long-term health needs could be accommodated. However, it was recognised that to qualify for protection, disability had to be long term and have an adverse effect on an individual's ability to carry out normal day-to-day activities.


In our submission to the Discrimination Law Review, we emphasised that any review must not lead to legislation being harmonised at the highest level and improved support and advice for employers is the key to delivering better outcomes. Extending the definition of disability may 'simplify' the legislation but not in a way employers would find helpful.


Extending the definition of disability may discredit the legislation

The proposal to extend the definition of disability to protection against discrimination on the grounds of any 'impairment', regardless of level or type of impairment, would represent a radical reformulation of the law. Under the existing DDA a person has a disability if s/he has a physical or mental impairment with a substantial and long-term adverse effect on his or her ability to carry out normal day-to-day activities. The focus is on the medical condition and the requirement to make reasonable adjustments.


The social model would shift focus from the medical condition of the individual (is s/he disabled under the DDA and does s/he require adjustments) to the act of alleged discrimination. This would mean that anyone, with potentially any level or type of impairment (lower back pain, sore foot, stress etc), could make a discrimination claim. Our members are concerned that this approach would trivialise disability rights and discredit the legislation by opening it to abuse.


Businesses need to have confidence in the clarity and practicality of the definition

Employers agree that the current definition of disability creates uncertainty and in some cases the only way to determine whether a person is disabled is to go to tribunal. Nevertheless, they do not believe that extending the definition of disability would resolve this uncertainty. While there would be no need to determine whether someone was disabled, far more people would be able to ask for reasonable adjustments and there would be less clarity about the extent to which these would have to be accommodated. This is likely to lead to a higher number of tribunal cases, with added complexity that will lead to a more adversarial atmosphere and higher costs in drafting in more experts at the hearing stage.


The social definition could weaken protection for the most disadvantaged

In reality, not all requests for reasonable adjustments can be met. Resources will always be finite and people who are in need of more or expensive adjustments may not receive them if employers receive an increased number of requests for adjustments from employees with minor or even severe but short-term ailments. One practical example relates to company cars: some employees claim they have impairment, such as lower back pain, and ask for 'reasonable adjustments' - typically adjustments to their existing car or to buy them out of their car contracts. Under the current legislation, if the occupational doctor confirms they are not disabled, employers are entitled to make no or more minor adjustments than if they were covered by the DDA. This enables a more targeted approach that benefits those with serious or long-term impairments.


We are also concerned about the possibility of unintended consequences. At present, guaranteed interview schemes and other positive employment practices are designed to help the most disadvantaged. There is a real risk that extending the definition of disability would weaken protection for the most disadvantaged, in order to aid those with more trivial or less disabling conditions.


Our members have emphasised that there needs to be a clear distinction between what the law requires and 'best practice'. Many employers are able to make to make adjustments for staff with impairments that do not come under the definition of disability; however, this should not be a requirement of the law. The purpose of the law should be to set out minimum standards, not best practice.


What are your views on the default retirement age? Should it be scrapped?


We support the decision to retain a default retirement age with a right to request postponing retirement. The legislation provides both employers and employees with a clear picture of their responsibilities and rights and offers a framework for retirement discussions.


A default retirement age encourages dialogue between employers and employees

Individuals do not necessarily want to work longer or on a full-time basis after 65 - what they really want is greater choice and engagement with their employer about the options open to them at retirement. The default retirement age provides this dialogue with a point around which to focus meaningful discussion: without it, employers might be less keen to open up a discussion about retirement options for risk of incurring an age discrimination charge. The current legislation protects the individual's dignity and their opportunity to discuss retirement options in non-confrontational circumstances.


It is right that employees should not have a unilateral entitlement to remain in employment after 65. The new right for employees to request postponement of retirement provides a balance: indeed, many companies employ staff beyond retirement age where they are needed. However, this is not about forcing people to work till they drop and neither party should have to maintain an employment relationship longer than they want to.


Businesses value the DRA as a tool to plan for the future

Employers firmly believe that the right to retire staff at or above 65 (or an objectively justified lower age) is a vital management tool - for health and safety or employment planning reasons. A clear retirement age is important to companies in planning their business and ensures that firms can retire employees with dignity rather than forcing them to dismiss staff on grounds of competence. Without a normal or default retirement age, firms would have to justify and re-justify each individual retirement. Having certainty as to the end of the employment allows businesses to operate efficiently in a variety of ways:

Many firms with long training periods use the number of employees nearing retirement age to calculate how many apprentices or trainees to take on.

Smaller firms may use retirement ages to predict when senior positions will become available - either to ensure knowledge transfer or to retain junior members of staff who need to be offered promotion.

Firms facing a number of redundancies might be able to use numbers nearing retirement to more accurately predict losses through natural wastage - and in this way not make more redundancies than are necessary.


However, flexible retirement is growing in popularity

Whilst the default retirement age has allowed businesses to plan their HR functions with greater certainty, there is evidence that firms are also becoming more receptive to the concept of flexible retirement. The right to request postponing retirement has proven successful in balancing the individual needs of staff and the needs of the business, and complements the rise in other types of flexible working, with employers embracing practices such as part-time work, flexible hours and remote working.


The 2008 CBI/Pertemps Employment Trends Survey illustrates how employers have adapted to the new regulations after 18 months and shows that:

Almost a third (31%) of employees reaching retirement age postponed retirement in the last 12 months. More than four fifths (81%) of requests were granted, representing substantial increases on last year's results - 22% and 72% respectively.

Encouragingly, employers of all sizes are offering extended working: nine out of ten requests are now accepted by employers with up to 500 employees, up from 55% in 2007. This suggests that smaller firms - without the HR capacity of larger employers - have adapted to the new regulations after testing the water in the first year.

The total percentage of employees working post-retirement age has increased from 16% to 33%.


These figures suggest the encouraging start made by employers and employees has continued, as firms gain a greater understanding of how the new system operates in practice. Employers value and want to retain the skills and experience of older workers: the 'right to request' system balances this flexibility with the need for a default retirement age, so that employers can say no when the extension is not possible. We believe that this is the right solution and is working in practice.


The DRA will be reviewed in 2011 and we trust that BERR's consultation and regulatory impact assessment will reflect both the legislation's success and the economic environment as it stands at that time.


February 2009