Wednesday, 27 August 2003

Future Loss of Earnings: The Ogden Tables

[Thanks to John Bowers QC of Littleton Chambers, who acted for Kingston upon Hull City Council, for sending me the transcript of this decision]

The Employment Appeal Tribunal has handed down its decision in Kingston upon Hull City Council v Dunnachie (no. 3). Yes - this is the same Dunnachie case that we all know and love, but a less well publicised aspect of it.

The EAT (Burton P. presiding) held that it is normally inappropriate to use the Ogden tables when assessing future loss of earnings in unfair dismissal (and, presumably, discrimination) claims, unless it has been established that there will be a career-long loss. They should not be used to reflect the chance of a career-long loss, i.e. by choosing a multiplier from the tables and then reducing it by, say, 50% to reflect that the loss may not, in fact, be (working-) life-long.

The Appeal Tribunal held that using the Ogden tables:

"risks the introduction of an air of spurious accuracy. Great care is devoted to selecting the correct Table and the correct rate of return and the correct multiplier to two decimal places - and yet then a broadbrush percentage discount, 50% or 30%, is suddenly chosen and applied." (para. 26)

The EAT set out clear procedural guidelines, including an early and detailed Schedule of Loss and counter-Schedule of Loss (with specific factual assertions components which must be included), if the Applicant is seeking to rely on the Ogden tables. The core of the decision is at paragraphs 28-30, and paragraphs 33-34, of the judgment.

Burton P. made it clear that the warning against using the Ogden tables did not apply to the applicability of the Ogden tables when calculating pension losses. On this point, the new DTI guidelines on calculating pension losses in employment tribunals (which went out to consultation earlier this year) are likely to be published in the autumn. They are widely expected to support the use of the Ogden tables in calculating pension losses.

Finally, the decision dealt with an important point of principle on the award of costs. I will deal with this in a separate bulletin.

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