The judgment of the Employment Appeal Tribunal in Awan v ICTS was handed down on the 23rd November 2018. It provides support for advice we have been providing for our clients for some considerable time in respect of long term sickness, insured benefits and capability dismissals.
In short, if your employee is on long term sickness leave and is entitled to insured long term disability benefits, and you choose to dismiss that individual for capability (depriving them of those benefits), there is a substantial risk that an Employment Tribunal is very likely to find a way to sanction you for that (either by finding that the dismissal itself was discriminatory or, as in this case, that the employment contract contains an implied term that “once the employee has become entitled to payment of disability income due under the long-term disability plan, the employer will not dismiss him on the grounds of his continuing incapacity”).
In Awan v ICTS, having found that the individual’s contract contained an implied term that an individual who is entitled to (and in receipt of) long term sickness benefits will not be dismissed, the Employment Appeal Tribunal remitted the case back to the Employment Tribunal for consideration.
In more detail… Mr Awan worked for American Airlines as a Security Agent at Heathrow Airport. His employment contract provided him with an insured long term disability benefit plan. The terms of the plan stated that benefits would terminate in the event the employee was no longer in employment. Mr Awan went on sick leave suffering with depression. While Mr Awan was on long term sickness absence American Airlines outsourced the security department to ICTS. As a result his contract transferred to ICTS under TUPE along with the obligations under the disability benefit plan.
Some time after Mr Awan was dismissed by ICTS for incapability. A tribunal held ICTS acted reasonably and the dismissal was fair. They also found that the dismissal was a proportionate means of achieving a legitimate aim. As a result, there was no unlawful disability discrimination under the Equality Act 2010.
As set out above, the EAT disagreed. Finding an implied term that people suffering from long term sickness and in receipt of such disability benefits should not be dismissed, they remitted the case to the Employment Tribunal.
The full judgement is published below: