Pal v Accenture: EAT clarifies Polkey reductions and disability discrimination assessment

The Employment Appeal Tribunal has overturned key findings in Pal v Accenture (UK) Ltd, providing important guidance on Polkey reductions, "up or elsewhere" performance models, and the assessment of disability arising from endometriosis.

Factual background

Ms Pal worked for Accenture for approximately 10 years, progressing from Analyst to Manager. Accenture operated a progression-based performance model requiring employees to demonstrate continuous development towards the next career level. Following surgery for endometriosis in 2018 and subsequent sick leave, Ms Pal received two consecutive "Not Progressing" talent outcomes and was dismissed in July 2019.

The employment tribunal found the dismissal procedurally unfair because Accenture breached its Disciplinary and Appeals Policy by failing to conduct a formal investigation and using decision-makers who had been previously involved in performance management. However, the tribunal applied a 100% Polkey reduction, concluding Ms Pal would have been dismissed fairly regardless.

The EAT's decision on Polkey

His Honour Judge James Tayler held the tribunal erred in law by applying an incorrect counterfactual. Rather than assessing what Accenture would have done had it complied with its policy, the tribunal speculated that the company would have introduced a new policy mirroring its actual process.

The EAT emphasised that Polkey reductions require tribunals to assess what the actual employer would have done, not what a hypothetical fair employer might have done. Without evidence that Accenture would have introduced a new policy, the tribunal should have considered what would have happened had the company followed its existing procedures, including conducting a proper investigation with independent decision-makers.

"Up or elsewhere" performance models

The EAT examined whether dismissal under progression-based models constitutes capability dismissal. Capability must be assessed against "work of the kind which [the employee] was employed by the employer to do" under the contract of employment. Dismissal for failure to demonstrate readiness for promotion may not relate to capability for current contractual duties, though it might constitute "some other substantial reason" for dismissal.

The tribunal will need to determine on remission whether any dismissal would have been primarily for performance in the claimant's current role or for failure to demonstrate promotion readiness, and whether this constituted a potentially fair reason.

Disability discrimination

The EAT found the tribunal's disability analysis inadequate. The tribunal drew an unexplained distinction between endometriosis and recovery from surgery, failing to consider whether surgical recovery constituted a substantial adverse effect arising from the impairment. The tribunal also neglected to assess the likelihood of recurrence, despite medical evidence of recurrent endometriomas, and failed to consider whether the condition would have substantial effects absent medical treatment.

On knowledge, the EAT held the tribunal had not properly assessed whether Accenture had constructive knowledge of disability, particularly given that a compliant investigation would have required deeper consideration of the claimant's ongoing medical condition.

The discrimination arising from disability claim also requires fresh consideration. The tribunal failed to analyse whether the claimant's sick leave and phased return formed part of the reason for dismissal, even if not the principal reason.

The case has been remitted to a fresh tribunal to reconsider all outstanding matters, given the fundamental nature of the errors and the tribunal's highly adverse credibility findings against the claimant.

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