Age Discrimination and Health Insurance

Age Discrimination and Health Insurance

A recent case in the Newcastle Employment Tribunal considered whether stopping an employee’s permanent health benefits once they had turned 55 could constitute age discrimination.
The Tribunal in Whitham v Capita Insurance Services Limited held that yes it could.
Mr Witham had been in receipt of benefits from Capita under a Permanent Health Insurance (PHI) scheme which had been arranged between Capita and an insurance provider. The payments stopped when he turned 55.
Mr Whitham had been denied the opportunity to join a more favourable PHI scheme that had been arranged in 2002. This more favourable scheme would have entitled him to receive PHI payments until he turned 65. The insurance company was not prepared to indemnify Capita in respect of PHI payments if the employee was not"actively at work" when applying to join. Mr Witham was at that time ill and in receipt of benefits under the original PHI scheme and therefore not eligible for the new scheme.
It was held by the Tribunal that Capita had directly discriminated against Mr Witham because of his age. The employer claimed that it was using proportionate means to achieve a legitimate aim of the business which was to admit as many employees into its pension and PHI schemes as possible within the constraints of the insurance company’s conditions. However the Tribunal did not accept that the employer genuinely had this aim as the offer of PHI membership was selective and not made to everybody.
The Tribunal also rejected the argument that stopping the PHI payment was an appropriate and necessary means of achieving that purported aim. By ceasing to cover Mr Witham the employer had reduced the number of employees within the PHI scheme. This was seen to have hardly been promoting its stated objective and the employer’s monetary considerations in funding the PHI scheme were not to be taken into account.
It was also found that there was indirect age discrimination in these circumstances because the employer applied a provision criterion or practice (the"actively at work" criterion) which put employees over the age of 45 age at a particular disadvantage when compared to those younger than 45. For the same reason as applied in the direct discrimination claim above this also could not be justified.
Finally on the facts of the case the Employment Tribunal decided that Mr Witham had a contractual right to receive his PHI payments until the age of 65 because an earlier attempted variation of his employment terms and his entitlement under the policy was held to be ineffective.
If you believe that your employer has discriminated against you because of your age or for any other reason or your employer is refusing to uphold the terms and conditions of your employment please contact the employment law specialists at Michael Lewin Solicitors and we will be happy to discuss your case with you.
Written by Anthony Fox

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