A2/2005/1332
Neutral Citation Number: [2006] EWCA Civ 517
IN THE SUPREME COURT OF JUDICATURE 
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM EMPLOYMENT APPEAL TRIBUNAL
Royal Courts of Justice 
Strand 
London, WC2 

Wednesday, 29th March 2006
 B E F O R E:

LORD JUSTICE PILL

LORD JUSTICE SCOTT BAKER

LORD JUSTICE HOOPER

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(1) CLARE FLETCHER
(2) TRACEY PARKES
(3) SHELLEY WILKINSON
CLAIMANTS/RESPONDENTS
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(1)	NHS PENSIONS AGENCY/STUDENT GRANTS UNIT
(2)	THE SECRETARY OF STATE FOR HEALTH
 DEFENDANTS/APPELLANTS
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(DAR Transcript of 
Smith Bernal Wordwave Limited
190 Fleet Street, London EC4A 2AG
Tel No:  020 7404 1400  Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
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MR A LYNCH QC and MR D OUDKERK (instructed by Office of the Solicitor, Department of Health, LONDON, WC2A 2LS) appeared on behalf of the Appellant.
MS T GILL and Ms B CRIDDLE (instructed by Messrs Palmer Wade, LONDON, EC1V 0AA) appeared on behalf of the Respondent.
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J U D G M E N T
1.	LORD JUSTICE PILL:  This is an appeal against a judgment of the Employment Appeal Tribunal (“EAT”), Cox J presiding, delivered on 3 June 2005 following a hearing on 19 January 2005.  The EAT allowed an appeal from a decision of an Employment Tribunal held at London Central, sent to the parties on 8 April 2004.  The unanimous decision of the Employment Tribunal (“the Tribunal”) had been that the present appellants did not discriminate against the present respondents, Mrs C Fletcher and Mrs T Parkes and Miss S Wilkinson, contrary to section 14 of the Sex Discrimination Act 1975.   I will refer to the present respondents as the claimants.

2.	The claimants were participants in university courses for qualifications necessary to be practising midwives.  Their courses involved both academic studies and clinical training.  It is common ground that the courses are properly described as vocational courses and the claimants as vocational trainees.  Each of the claimants gave birth to a child during the currency of her vocational course.  Each of the claimants had been in receipt of bursary payments during their studies, the bursary system being operated by the first appellants, the Blackpool Wyre and Fylde NHS Hospital Trust.  The practice was for bursary payments to cease if a vocational trainee suspended or withdrew his or her involvement in the course of study for any reason, subject to a rule allowing continuing payment in any event of up to 60 days absence in a year for ill-health.  

3.	The claims involved a complaint that the claimants ceased to qualify for continuing bursary payment if they suspended their involvement in the vocational training as a result of their pregnancy and maternity (“maternity”).

4.	The original claims alleged that the claimants were workers or employees within the meaning of the statute.  The Employment Tribunal found against them on that aspect of the case.  Alternatively, they claim that there was sex discrimination, contrary to section 14 of the Sex Discrimination Act, in the failure to continue to make bursary payments to them during their maternity.  The EAT held that there was sexual discrimination under section 14 and the matter was referred back to the employment tribunal for a remedies hearing conducted on the basis of the conclusion of the EAT.  

5.	The appeal is now brought by the Trust and the Secretary of State for Health,.  Mr Lynch QC submits, on a point of principle: did the Secretary of State unlawfully discriminate against the claimants by reason of the absence of a scheme providing for payment during maternity?  That depends, submit both Mr Lynch and Mr Oudkerk on behalf of the appellants, on whether the “but for” test mentioned several times in the determination of the EAT is the correct test.  They also pose the question: does the protection accorded by the law to pregnant workers extent to pregnant vocational trainees?

6.	Late on the first day of what was set down as a three-day hearing, it came to the attention of the court for the first time that the three claims had been settled between the parties.  Whatever the outcome of the appeal, we are told, the sums paid to the claimants will not be reclaimed.  We are also told that the Secretary of State has introduced a scheme, operative as from 1 June 2005, for maternity arrangements for NHS students and vocational trainees.  We were then supplied by Miss Gill, for the claimants, with a document dated 21 September 2005, giving particulars of the scheme.  The introductory part of the document provides:

“The Department of Health has decided to implement new interim arrangements for students who need to leave their studies temporarily because of pregnancy and childbirth.  This change is to ensure that students are not compelled to abandon their courses because of a lack of financial support during this period.  The Government wants to encourage people to work in the NHS and believes family-friendly policies are important in encouraging people, particularly women, to consider a career in the NHS.  Students taking leave from training from 1 June 2005 for reasons of pregnancy and childbirth will now continue to receive their existing NHS bursary payments.  Full details of the arrangements are outlined in the FAQ section below [that is, the Frequently Asked Questions section] and further background information can also be obtained here.  The interim arrangements have been introduced following full consultation and agreement from stakeholders such as UNISON, the Royal College of Nursing, the Royal College of Midwifery and the Equal Opportunities Commission.”

7.	The particulars of the scheme are then set out in the FAQ section.  

“1. Students will continue to receive their existing NHS bursary payments throughout a period of maternity leave which has been agreed with their respective university.  The bursary will normally continue to be paid up to a maximum of 45 weeks but may be extended if there are exceptional circumstances.

“2. Full and part-time students who are in receipt of an NHS bursary who need to take a break from training due to pregnancy and childbirth.  This includes nurses, midwives, allied health professionals and medical and dental students who are in receipt of an NHS bursary.  EU students in receipt of a fees-only award, and assisted or seconded students will not be eligible.

“3. Existing NHS bursary including older students’ allowance, single students’ allowance and dependence allowances will continue to be paid to you as normal.

“4. In answer to the question ‘what is the earliest date I can begin my period of maternity absence?’  Normally, this cannot be earlier than 11 weeks before the expected date that your baby is due …

“7. ‘What happens if I am ill while pregnant or there are complications during or after my pregnancy?  Can I still receive my NHS bursary if I have to extend my period of agreed absence beyond 45 weeks?’  You will need to agree any period of absence exceeding 45 weeks with your university.  In exceptional circumstances it may be possible for the bursary payments to be extended beyond 45 weeks.  This would be based on individual circumstances and would need to be agreed between your university and the NHS PA Student Grant Unit.”

I will not read the remaining detail, save that in relation to backdating:

“Payments for maternity absences commencing before 1 June 2005 cannot be authorised.  The interim arrangements outlined above have been agreed with and are supported by key stakeholders including the Royal College of Midwives, the Royal College of Nursing and UNISON.”

8.	The organisations mentioned in the document are supporting the claimants in the present litigation.  We have also been supplied with a document found on a Government website in relation to the claimant Mrs Fletcher.  That refers to the present litigation and also states:

“It is abundantly clear that the Government wants to encourage people to work in the NHS and that family-friendly policies are important in encouraging people, particularly women, to consider a career in the NHS.  Whilst the original Employment Tribunal in 2004 rejected these claims and any allegation of discrimination, it did raise questions about the policies underpinning the NHS bursary scheme in relation to authorised absences due to maternity.  As a result of the Employment Appeal Tribunal decision the Department of Health are in the process of giving careful consideration to alterations to the underlying policies and have set up a wider review of how authorised absences from NHS-funded courses should be treated in terms of continuing NHS bursary payments.  The NHS pension agency with the authority of the Department of Health will shortly be implementing interim arrangements to improve the way absences due to maternity are dealt with under the NHS bursary scheme.  The interim arrangements will need to be reviewed when there has been a proper opportunity to assess them in practice.”

In relation to that last sentence, I comment that there is no reference in this document to the arrangements being dependent on the outcome of the present litigation.  The document is undated but it appears to pre-date, and probably only shortly so, the document which I have cited in some detail.  

9.	This morning, Mr Lynch has supplied us with a letter from the solicitor to the Department of Health to the claimants’ solicitors dated 2 September 2005.  It refers to a review of the NHS bursary scheme:

“As you are aware from the discussions between the interested parties, we are in the process of conducting a review of the scheme with a view to introducing interim provisions which will provide for a period of authorised absence due to maternity before pilot interim arrangements.  With effect from 1 June 2005 no bursary has been stopped in cases where students’ authorised absence from her course has been due to her pregnancy.  The pilot interim arrangements will be introduced in September 2005 but will be backdated to 1 June 2005.  The provision of benefits under the scheme during the period of authorised absence due to maternity is far from straightforward.  For example, difficulties may arise in reconciling a student’s return date with the university term dates.  In addition, our clients will need to consider carefully what qualifying provisions, if any, are appropriate.  We are therefore introducing pilot interim arrangements on a trial basis in order properly to assess how those arrangements can be made to work in practice.  A review of the scheme and the appeal are separate issues in the sense that [the appeal being the present appeal] regardless of the outcome of the appeal, our clients are committed to ensuring that the scheme makes express provision for a period of authorised maternity absence although that may not mirror precisely the statutory scheme that applies to workers.  However, our clients [they are the Department for Work and Pensions as well as the Department of Health] will obviously wish to consider both the outcome of the pilot and the judgment of the Court of Appeal in this case before final arrangements are put in place.”

10.	I note in particular the statement in that letter of a “commitment to ensuring that the scheme makes express provision for a period of authorised maternity absence”.  It is common ground that the scheme now in operation has been properly introduced by the Secretary of State pursuant to powers under section 63 of the National Health Service and Public Health Act 1968, particulars of which are set out in paragraph 29 and following of the tribunal decision of 9 February 2004.  

11.	When the point was first raised yesterday afternoon, Miss Gill submitted that the court should not entertain the appeal and she has persisted in that view today.  In the course of Mr Lynch’s submissions yesterday, we were referred to the case of North Western Health Board v McKenna [2005] IRLR 895 ECJ.   At paragraph 59 the court stated:

“Next it is necessary to bear in mind that as community law stands at present no general provision or principle thereof requires that women should continue to receive full pay during maternity leave, provided that the amount of remuneration payable is not so low as to undermine the community law objective of protecting female workers, in particular before giving birth.  See Gillespie & Ors paragraph 20.”

12.	That principle is stated to apply to workers as defined in the legislation and it leaves open the question, submits Mr Lynch, of its application to vocational trainees.  Mr Lynch now submits that the only issue before the court is the “but for” issue, that is, but for the pregnancy, the absence would not have arisen.  He did, however, address us on other issues, notably the effect of Gillespie, already mentioned, for a good part of yesterday.  

13.	Mr Lynch also refers to the existence of six other cases making similar claims.  These have been stayed pending the outcome of these proceedings.  The explanation for the present cases having been settled and the stayed cases not being settled appears in a letter from the appellant’s solicitor dated 20 December 2005, in which an offer to the claimant was set out:

“This offer is intended to provide compensation to your clients in circumstances where the litigation in which they have been directly involved and in which they have given evidence is now concerned with issues of principle which as a result of the decision of the EAT will need to be resolved by the Court of Appeal.  The offer is designed to provide your client a certainty in that regardless of the outcome of the appeal, they will each recover the sum of £5,000.  Our clients have considered carefully whether or not any payment should be made other in cases [that should be “in other cases “] which have been stayed pending the outcome of this case, and which were not directly before or dealt with either by the Employment Tribunal or the EAT.  Our clients consider that the question of whether or not any compensation is due in any of those stayed cases should await the outcome of the appeal in the usual way.”

14.	It is submitted, though more faintly than in the case of the first submission, that the appeal should proceed because of those stayed cases.  We do not know, nor should we have been told, of the facts of those cases.  Mr Lynch’s best point in my view is in the difficulty of understanding, with respect, the reasoning of the EAT, whose decision runs to 109 pages and includes extensive reference to ECJ and domestic authority.  We invited Miss Gill late yesterday to address us with a view to explaining the rationale of the decision.  I confess that notwithstanding her submissions to date, I still find it very difficult to follow the reasoning of the EAT or to decide upon the basis for their decision.  

15.	Mr Lynch seeks to reinstate the conclusion and decision of the Employment Tribunal and submits that there will be real and genuine difficulties in applying this decision of the EAT.  I bear that submission in mind in considering whether the appeal should be permitted to proceed.  Mr Lynch does not invite the court to consider the minutiae of a lawful scheme, such matters as whether the absence during which a bursary can be paid should be 41 weeks, for example, or 45 weeks, or precisely how much shall be paid.

16.	Mr Lynch’s submission is that that Secretary of State’s approach to the scheme and to future schemes may depend on the court’s decision in this appeal.  I cannot accept the validity of that argument, unless it is intended, which Mr Lynch says it is not, to use the legality of not having a scheme at all as a bargaining factor in defining the terms of the scheme.  Once it is accepted that there should be a scheme, and the Secretary of State has committed himself to that, he will no doubt bear in mind that the maternity needs of women are the same whether they are workers or vocational trainees.  The interim scheme is lawfully implemented under powers conferred and the Secretary of State is committed to ensuring the result cited in his letter.  

17.	The scheme was introduced following consultation and, with respect, appears sensibly to address the needs which arise.  The effect of the scheme is that absences due to maternity are treated under the scheme in a way different from absences for other reasons.  That being so, a declaration that the Secretary of State need not have a scheme at all is, in my judgment, of no practical value.  It is common ground that the court should not, at any rate in the absence of specific facts before it, direct the Secretary of State as to what precisely the contents of the scheme should be.  We would not have been prepared to embark on such an exercise in any event.  In my judgment, further costs and court time should not be taken up with the determination of the issue of principle said to be involved.

18.	I would exercise the court’s discretion not to proceed with the appeal.  I understand that my Lord, Scott Baker LJ will refer to authorities upon the exercise of that discretion.  I would dismiss the appeal on that ground, making it clear that I am not thereby approving or expressing a view on the decision of the EAT or the reasoning by which it is reached.  It is much to be hoped that the six stayed cases will be settled on the same basis as those the subject of these proceedings.  Although the claimants had given evidence, and that is mentioned by the Secretary of State in making the distinction between the claimants and the stayed actions, they are in the same position as the present claimants and would understandably feel aggrieved if their claims were not to be treated on terms as favourable as those of the claimants.  Otherwise, their cases may need to proceed to a remedies hearing before the Employment Tribunal on the basis of the EAT decision.  For the reasons I have given I would dismiss this appeal.

19.	LORD JUSTICE SCOTT BAKER:  I agree for the reasons give by my Lord, Lord Justice Pill, that the court should proceed no further in hearing this matter.  As Lord Bridge said in Ainsbury v Millington [1987] 1 WLR 379 at 381:

“It has always been a fundamental feature of our judicial system that the courts decide disputes between the parties before them.  They do not pronounce on abstract questions of law when there is no dispute to be resolved.”

20.	In The Queen v the Secretary of State for the Home Department [1993] 1 WLR 115 at 120, Lord Goff of Cheveley said it was well established that the House of Lords does not decide hypothetical questions.  If it were to do so, he said, any conclusion and the accompanying reasons could, in their turn, constitute no more than obiter dicta expressed without the assistance of a concrete factual situation and would not constitute a binding precedent for the future.  The Queen v the Secretary of the State for the Home Department ex parte Salem [1999] 1 App 450 was a case where it was submitted on appeal to the House of Lords that an appeal should continue to be heard, albeit there was no longer a live issue between the parties, because the case raised a question of public importance.  Lord Slynn drew a distinction between cases involving disputes about private rights and issues involving public law.  The strict principle in Ainsbury v Millington he said was limited to disputes concerned private rights.  He said this at 457 at (a):
“The discretion to hear disputes even in the area of public law must however be exercised with caution and appeals which are academic between the parties should not be heard unless there is a good reason in the public interest for doing so.  As for example, but only by way of example, when a discrete point of statutory construction arises which does not involve detailed consideration of facts and where a large number of similar cases exist or are anticipated so that the issue will most likely need to be resolved in the near future.”

21.	There may be a stronger argument for proceeding in a public law case, although even in those circumstances the court’s undoubted discretion still has to be exercised sparingly.  It was with some surprise that I learned yesterday afternoon, after the appeal had been in progress for some hours, that the respondents’ claims had been settled.  The court should have been told this before the appeal began so that it could then have heard argument and decided at that point whether, in the exercise of its discretion, it was appropriate for the appeal to proceed.  I, too, have had difficulty in following all the reasoning in the very prolix judgment of the EAT.  However, I have had the advantage of reading in draft what Hooper LJ proposes to say.  I agree with it, and in particular with his analysis of the decision of the EAT and why it is now academic to proceed with an appeal.  

22.	In my judgment, there is no good reason for exercising the court’s residual discretion to continue to hear this appeal, notwithstanding the settlement that has occurred, and I too would dismiss the appeal.

23.	LORD JUSTICE HOOPER:  I agree that we should not entertain this appeal.  It is most unfortunate that the parties to this appeal cannot even agree as to what was the ratio of the decision of the Employment Appeal Tribunal (“EAT”).  In my view the ratio of the decision of the EAT is to be found, albeit with difficulty, by examining paragraphs 76, 108 and 109 of the judgment.  

24.	In paragraph 76 the EAT found that by treating absence from the course for reasons of maternity in exactly the same way as the appellants treated absence from the course for any other reason (leaving aside absence for sickness), the Bursary Scheme for Trainee Midwives and Nurses discriminated against the claimants in a way that was unlawful by virtue of section 14 of the Sex Discrimination Act 1975.  In paragraph 108, the EAT decided that a non-discriminatory bursary scheme had to provide a “minimum adequate allowance” (whatever that may mean) for trainees absent from the course for reasons of maternity.  

25.	In paragraph 109, the EAT remitted the case to the ET to decide what payment should have been made to the claimants and for how long.  This shows, contrary to the submissions of Mr Lynch QC, that the EAT was not deciding that the claimants were entitled to payment of the full amount, which would have been paid under the bursary scheme during the whole period of their absence for reasons of maternity.

26.	In fact the remedies hearing never took place; something we discovered in the afternoon of the first day.  The appellant settled the financial claims with the claimants, albeit without accepting liability.  The ET was therefore spared the extremely difficult task which the EAT had required it to undertake.  

27.	On the morning of the second day, we received a supplementary bundle which contained amongst other things a letter dated 2 September 2005 written on behalf of the Secretary of State.  Pill LJ has cited passages from that letter.  That letter is to be read with a document obtained from a Government website, which we were provided at the end of the first day.  The first three paragraphs of that document have already been set out by Pill LJ.  Also on the website was a document relating to one of the claimants, Clare Fletcher, the material parts of which have also been set out by my Lord.  Both parties agree that this court could not, or should not, decide the questions which were remitted to the ET by the EAT, namely amount and duration.  It follows that irrespective of the outcome of this appeal, the Secretary of State has altered the terms of the bursary scheme so that trainees absent from a course for reasons of maternity are treated differently from those absent for other reasons.

28.	It follows in my view that the appeal against the decision of the EAT, as I have analysed it, is academic or hypothetical on the authorities cited by Scott Baker LJ, and for these reasons the court should not entertain it.  I would therefore also dismiss the appeal.

Order:  Appeal dismissed.