News Updates

Compensation: long-term future loss

Friday 21st July 2017

In Small v Shrewsbury & Telford Hospitals NHS Trust the CA has held that the ET should have considered whether to award compensation for long-term future loss of earnings in a whistleblowing case, even though the Claimant did not raise the point.

Mr Small began working for the Trust in 2012, when he was 56, on a temporary assignment through an agency. After this appointment was terminated, Mr Small successfully argued before the ET that he had made a protected disclosure which resulted in his termination. He was awarded compensation of £54,126, which included £33,976 for loss of earnings, calculated on the basis that his replacement was only retained until 14 November 2013 and not permanently. Mr Small appealed.

Mr Small had claimed future loss of earnings up to his anticipated date of retirement of 2022 on the basis of being employed permanently by the Trust. However, his claim did not include future losses related to his inability to obtain employment outside the Trust.  

Before the EAT, Mr Small argued that the principles established in Chagger v Abbey National plc should have been considered by the ET when awarding compensation. Chagger held that a claimant can, in principle, claim loss of earnings extending beyond the date on which employment would have otherwise terminated. Chagger also allowed for the possibility of “stigma damages” where there is disadvantage in the labour market flowing from a claim brought following a discriminatory dismissal.

The EAT dismissed the appeal, holding that the Chagger principles were not so well established that they should be considered by ETs as a matter of course. However, on further appeal, the CA remitted the case back to the ET.   The CA agreed that such claims are not always to be considered routinely. However, the facts of this particular case were such that it was an obvious alternative claim given the evidence demonstrating Mr Small’s difficulties finding alternative employment and the ET’s view that the termination appeared to be “career ending”.

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