Morrisons is cutting sick pay for unvaccinated staff. Where do employers stand legally?

This month, Morrisons confirmed it would cut contractual sick pay for unvaccinated staff. It is one of several top retailers to have gone down this route – while others, like John Lewis, have taken the opposite approach.

The divergence in approach has fuelled debate around the rights of individuals who do not vaccinate. And there are some complexities around the legalities of such a decision, mostly related to the various protections offered to specific groups under the Equality Act.

These retailers are not suggesting that staff who remain unvaccinated will be dismissed – they are just paid less sick pay in the very specific circumstance where they have to isolate due to close contact with someone who has Covid, but have not tested positive themselves.

These employees might consider a claim for constructive unfair dismissal. But this would be very challenging to pursue, because there are specific legal requirements the employee would need to establish that involve a degree of significant risk for them.

Initially, the employee would need to establish the employer is in fundamental breach of contract. Changing contract terms, such as those relating to sick pay, could be said to be a breach. However, what is less clear is whether an employment tribunal would consider it a fundamental breach that undermined trust and confidence to the extent that it was tantamount to a dismissal.

Given that this change only impacts the employee in relatively narrow circumstances, and assuming the employer has formulated sound reasons for the policy change, it is not clear whether this change would be seen as fundamental. Even where the employee decides this is the case, they would need to resign before being able to progress a claim at the Employment Tribunal, which means having no income while waiting for a currently overloaded and slow judicial process with limits on compensation awards. It makes resignation an entirely impractical option for the majority.

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Legal rights for employees with certain protected characteristics will be more troubling for the employer, and more likely to be pursued. Such claims are time-limited so have to be bought within three months (less one day) of the discriminatory act relied upon, so employees will have to move quickly (there are possibilities to extend some time limits but advice ought to be taken as soon as possible).

Unvaccinated employees could cite the protected characteristics of religious belief or disability. ‘I cannot have the vaccine because my religion or a health condition prevents it’ (although in the latter case, Morrisons has confirmed it will give full pay). Employees could then argue indirect discrimination. However, employers can, in certain situations, justify such a ‘provision, criterion or practice’ where it can be said to be a ‘proportionate means of achieving a legitimate aim’.

Some of these retailers have said they will consider cases of health or religion on a ‘case by case’ basis, which in practice means they will no doubt consider any potentially merited cases and make an exception by paying the sick pay to those individuals to avoid any legal challenge.

Another key factor in whether legal action or challenge is likely is the relatively small quantum of the potential claims. While some unvaccinated employees may end up having to isolate more than others, it is only one week’s pay lost on each occasion. This may not be enough to make legal action worthwhile. While Equality Act claims also have an element of injury to feelings awards, these would not typically be very high – with average awards around £10,000 in such cases and higher sums being reserved for very serious, sustained direct discrimination.

Employees who can organise themselves into group actions (such as where there is union support or support from an antivax group) might bring some form of legal challenge on human rights grounds. They may seek unlawful deductions of wages or they may want to obtain a declaration from the Employment Tribunal of their terms of employment – if they can show the change to sick pay policy was a breach of contract and unlawful – but there is no strong legal basis for these claims yet identified.

An unintended impact of this policy might be that unvaccinated employees conceal the circumstances that require them to isolate, and continue to attend work to ensure they receive full sick pay. This would be very difficult to police in practice.