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Sex discrimination: No tax on injury to feelings award

This report relates to 1 case(s)

Key points

In Orthet Ltd v Vince-Cain, the EAT holds:

  • There is no authority that supports the proposition that an award for injury to feelings is taxable. Such awards do not need to be made by the tribunal taking income tax into account. They are not awards for loss of earnings and are more akin to personal injury damages.
  • It was reasonable for the employment tribunal to award compensation for loss of earnings during a voluntary and finite period of retraining. A change of career was a reasonable step in all the circumstances and the employee had not failed to mitigate her loss by choosing to do this.
  • Where an award is made for loss of pension rights for a period of more than two years, a tribunal should use the "substantial loss approach" contained in the guidelines for tribunal chairs rather than the "simplified approach".