EAT considers career-long losses

Wednesday 14th July 2021

The EAT, in Secretary of State for Justice v Plaistow, has upheld an ET’s decision to calculate compensation for discrimination and harassment on the basis that the employee had sustained career-long losses.

Mr Plaistow began working as a prison officer in 2003 and in 2014 was transferred from HMP Feltham to HMP Woodhill. Following the transfer, he was subjected to harassment which included physical and verbal abuse related to his actual and/or perceived sexual orientation. The harassment continued until his dismissal in August 2016. Mr Plaistow’s claims of direct discrimination, harassment, victimisation and unfair dismissal were upheld by the ET.   Compensation was awarded under numerous categories, including for injury to feelings, plus aggravated and exemplary damages.

When determining loss, the ET considered it was very unlikely that Mr Plaistow would return to work before retirement. The award was discounted by 5% to reflect the possibility that his employment might have been cut short. However, a 20% uplift was applied for failure to comply with the ACAS Code of Practice on Disciplinary and Grievance Procedures. The total award exceeded £2 million.

On appeal, the prison service challenged, among other things, the ET’s finding that future losses be calculated on a career-long basis and the 5% discount. Both parties agreed that Mr Plaistow suffered PTSD, depression, and symptoms of paranoia along with functional impairments. However, there were differing views on prognosis, with Mr Plaistow’s expert believing his condition would be life-long and the expert for the prison service maintaining that there was insufficient evidence for such a conclusion.

The EAT held that the ET having clearly followed the approach laid down by the Court of Appeal (Wardle v Credit Agricole Corporate & Investment Bank 2011), had been entitled to find that Mr Plaistow was very unlikely to return to work and that this was “a rare case” where it was appropriate to consider future financial losses on a career-long basis.

The EAT emphasised that in most cases assessing loss over a career lifetime would be inappropriate. Additionally, since there was no finding that Mr Plaistow would be able to obtain equivalent employment and the prison service had a 95% retention rate to retirement, the ET was entitled to find that the remote possibility of returning to work could be reflected in an overall discount of 5%. However, the ET had failed to reflect the more general uncertainties of life, such as early death, disability or other unforeseen circumstances and Mr Plaistow’s continued commitment to working long hours in the discount.

The appeal against the 20% uplift was also allowed. The EAT did not think that the ET had lost sight of the size of the award, but the ET’s reasoning failed to demonstrate that it had considered the overall “financial value or impact” of the award once the 20% uplift was applied or that it was proportionate to the breach or just and equitable to apply such an uplift. These points were remitted to the ET.

All information in this update is intended for general guidance only and is not intended to be comprehensive, or to provide legal advice.