Damages for loss of employability and evidence of a real risk
Evans v Tarmac Central Ltd [2005] EWCA Civ 1820


Since the 1990s, the Court of Appeal has grappled to make sense of its bipolar approach to valuing damages for disadvantage on the labour market. Some of its judges adopt the imprecise approach of Lord Justice Taylor in Forey v London Buses [1990] 1 PIQR 48 of 'taking a stab at what is the appropriate figure', while others attempt to create an element of certainty through a multiplicand/multiplier method.


Practitioners are left to find a route through the judicial darkness by what at times can seem to be a futile exercise of collating evidence, only for it then to be metaphorically thrown into the air to see where it lands.


However, the need to construct a picture of risk is essential. In the instant case, the apparent lack of evidence resulted in the significant reduction by the appeal court of the trial judge's award from £30,000 to £10,000.


The claimant's statement contained nothing about the potential disadvantage on the labour market. This is a common failing on the part of claimant lawyers in employers' liability cases from, understandably, concentrating time at the initial interview in getting to grips with liability issues. Evidence in respect of some of the heads of damages such as Smith v Manchester (1974) 17 KLR 1 CA can, at that stage, be understated. However, a supplementary statement is necessary, for as Lord Justice Laws stated: 'The absence of any particular reason to suppose that the respondent might be thrown on to the market means in my judgment that the award of £30,000 is much too high. The judge was estimating the prospects of a contingency arising as to which there was no specific evidence.'


In the instant case, the judges asked the questions formulated by Lord Justice Browne in Moeliker v A Reyrolle & Co Ltd [1977] 1 WRL 132 and found that there was a real risk, in the remaining 21 years of the claimant's working life, that he may find himself on the labour market. In the absence of evidence to assist in assessing that risk, the court awarded a sum of £10,000. As to how this figure was calculated, it is impossible to glean. The claimant earned £17,750 net per annum; £10,000 is a little under 55% of his net annual pay. An arbitrary figure? It appears so.


Despite previous authority to the contrary (Lord Justice O'Connor in Watson v Mitchem Cardboard Ltd [1981] CA 98) the case demonstrates the need for some evidence that the claimant is at risk of finding himself on the open labour market in trying to quantify this head of damage.


By Simon Allen, Russell Jones & Walker, Sheffield