A settlement agreement cannot compromise a discrimination claim that has not yet been made, the Employment Appeal Tribunal has ruled.
The claimant, Mr Bathgate, had been employed by ship operator Technip for almost 20 years before he was made redundant from his chief officer position in January 2017. He was 61 at the time of his redundancy.
In December 2016 or January 2017, the company decided there was a need for redundancies at his grade. He was sent a settlement agreement that laid out the redundancy terms and he accepted them. This included an enhanced redundancy and notice payment, payable with his final salary, and an additional sum which would be paid in June 2017.
In March 2017, the company decided that the additional sum would not be paid to those aged 61 and over. This was not communicated to Bathgate until June 2017.
Bathgate claimed this amounted to age discrimination. Although the company accepted that age was the reason he was not paid the sum, it said that by signing the agreement, Bathgate had compromised his right to pursue any further claim.
Settlement agreements
However, in the EAT’s judgment handed down earlier this month, Lord Summers says: “In this case the claimant signed away his right to sue for age discrimination before he knew whether he had a claim or not. While that may be possible at common law, the [Equality] Act restricts parties’ ability to do so.
“The inclusion of a claim in a [settlement] agreement defined merely by reference to its legal character or its section number does not satisfy the language of [the Equality Act]. The words ‘the particular complaint’ suggest that Parliament anticipated the existence of an actual complaint or circumstances where the grounds for a complaint existed. I do not consider that the words ‘the particular complaint’ are apt to describe a potential future complaint.”
The company also argued that the protections against discrimination afforded under the Equality Act 2010 did not extend to the claimant in his capacity as a seafarer. Bathgate, who lived in Edinburgh, had been working on a ship that was registered in the Bahamas and operated outside UK and EEA waters, but at the time of his redundancy he was not on board the ship.
The EAT examined the wording of the Equality Act to consider whether Bathgate had a right to bring a claim. The judge considered that the claimant had worked on board the ship for most of his working life, which meant he did not cease to be a seafarer because he had not been working on a vessel towards the end of his employment.
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The judgment says: “It does not strike me as strange that a person who would not have been able to claim during his or her employment because their work was outside UK and EEA waters and on board a foreign flagged ship should be unable to claim for an act of discrimination that would not have been justiciable during employment. On the contrary it would be a consistent approach. Whether Parliament would consider it a desirable state of affairs is another matter. To give the claimant a right after employment he did not have during employment would require a rewording of the statute.”
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