The EAT has confirmed that automatically excluding workers on a formal attendance warning from a bonus scheme was unfavourable treatment that constituted disability discrimination.
In Land Registry v Houghton & Ors, the Claimants were issued with formal warnings as a result of disability-related sickness absences. As a result, they were automatically excluded from participating in a bonus scheme that paid out £900 to eligible employees for the year 2012. This was held to be unfavourable treatment that needed to be objectively justified in order to be lawful, which the Land Registry failed to demonstrate.
Whilst it was held that there was a legitimate aim to reward good performance and attendance, the operation of the bonus scheme undermined this, for the following reasons:
Firstly, there was no managerial discretion available in relation to sickness warnings; however, managers were allowed to operate their discretion for employees who had received a formal warning for conduct issues.
Secondly, it was held that this lack of discretion resulted in an inability to give credit to employees whose attendance had improved after a warning was issued.