It has long been understood that cost alone cannot be used as justification for something which would otherwise amount to indirect discrimination. In the case of Heskett v Secretary of State for Justice, the Court of Appeal (‘CA’) has provided further guidance on this.
In this case, the Claimant was a probation officer. To meet a cap on increases in public sector pay, the Ministry of Justice changed its pay structure so that progression up a pay scale took longer. This meant that the Claimant would earn less than his longer-serving (and typically older) colleagues in the longer term. He claimed indirect age discrimination and argued that saving cost alone could not amount to a legitimate aim and therefore the discriminatory effect of the new pay structure could not be justified.
The CA concluded that there cannot be a legitimate aim justifying discrimination if the only reason for the employer’s actions is to save costs. However, it stated that if the reason for the action is coupled with something else, such as the need to reduce expenditure and balance the books, then it can be. The CA therefore upheld the decision of the employment tribunal to reject the Claimant’s claim and his appeal was dismissed.
