ADJUDICATION OFFICER DECISION
Adjudication Decision Reference: ADJ-00000741
Complaint(s)/Dispute(s) for Resolution:
Complaint/Dispute Reference No.
Date of Receipt
Equal Status Act 2000
Date of Adjudication Hearing: 16/06/2016
Workplace Relations Commission Adjudication Officer: Michael McEntee
In accordance with Section 41(4) of the Workplace Relations Act, 2015 and/or Section 25 of the Equal Status Act, 2000 following the referral of the complaint(s)/dispute(s) to me by the Director General, I inquired into the complaint(s)/dispute(s) and gave the parties an opportunity to be heard by me and to present to me any evidence relevant to the complaint(s)/dispute(s).
Complainant’s Submission and Presentation:
The Complainants alleged that they had been discriminated against ( by a refusal to sanction a mortgage loan application) by the Respondent Bank on the grounds of
And treated unlawfully on the basis of
The essence of the case is that the Respondent Bank refused to sanction the mortgage loan on the basis that the Complainant relied as a source of income on a Full Time Carer (FTC) Allowance, as provided by the Department of Social Protection, for his wife who has a disability.
The Bank discriminated against the Complainant by Association.
The Carer’s Allowance is a reliable state provided income source and is as guaranteed as any other source of income.
In support of the Claim the Complainant referred to a UK case DRN 9905176 Financial Ombudsman Service , a claim of age discrimination and a report of a USA case from the State of Oregon Fair Housing Council
Respondent’s Submission and Presentation:
The Complainant alleges that he suffered direct and/or indirect discriminatory conduct on the grounds of disability by association, family status and age contrary to the Equal Status Acts, per the Form ES.1 before the Commission. The Respondent denies any discriminatory conduct and fully defends the claim.
The Complainant also alleges that he was not afforded reasonable accommodation.
The Respondent does not seek to deny that the Complainant’s wife has a disability. Nor does the Respondent seek to deny that the Claimant’s application for Approval-in-Principle (hereinafter referred to as “AIP”) was not successful. However, the Respondent does deny any allegation of discriminatory conduct.
Claim of Direct Discrimination
The Respondent denies that the Complainant was directly discriminated against. Section 3(1) of the Equal Status Act 2000, as amended provides discrimination occurs in circumstances where a person is treated less favourably than another person in a comparable situation by virtue of the grounds at subsection 2, including family status, disability and age.
The Complainant sought an AIP and all such applications are dealt with in accordance with the Respondent’s “Permanent Credit Policy” (hereinafter referred to as the “Credit Policy”), the terms of which are designed to create a consistent approach to the assessment of credit applications. All home loan applicants are obliged to comply with the Respondent’s eligibility criteria including formal assessment of affordability and repayment.
It is respectfully submitted that Complainant’s application was not treated less favourably than another person, but was treated in a manner consistent with the policy. The application of the Credit Policy resulted in an assessment that the Complainant’s application did not meet the bank’s standard / minimum credit criteria.
It is further submitted that the Respondent is obliged to comply with the Central Bank of Ireland’s Consumer Protection Code 2012 (the “Code”). Chapter 5 of the Code outlines the relevant considerations when assessing the suitability of a consumer for credit products, including mortgages. Section 5.1 outlines the personal circumstances that the Respondent is obliged to take into account including age, employment status, and income.
Sections 5.16 and 5.17 of the Code provide:
the product or service meets the consumer’s needs and objectives;
is likely to be able to meet the financial commitment associated with the product on an ongoing basis;
is financially able to bear any risks attaching to the product or service
in the case of credit products, a personal consumer has the ability to repay the debt in the manner required under the credit agreement, on the basis of the outcome of the assessment of affordability; and
the product or service is consistent with the consumer’s attitude to risk.
The following additional requirements apply:
where a regulated entity offers a selection of product options to the consumer, the product options contained in the selection must represent the most suitable from the range available from the regulated entity; and
where a regulated entity recommends a product to a consumer, the recommended product must be the most suitable product for that consumer.
It is submitted that the Code requires the Respondent to take into account the income of the Complainant and to assess whether the Complainant is likely to be able to meet the financial commitment associated with the product. Said Code applies to all consumers.
Notwithstanding and without prejudice to the submission that the Complainant was not discriminated against in terms of the Equal Status Acts, it is further submitted that section 5(1) of the Equal Status Act 2000, on non discrimination in the provision of services, does not apply in respect of mortgage products, having regard to section 5(2) which provides:
Subsection (1) does not apply in respect of –
(d) differences in the treatment of persons in relation to annuities, pensions, insurance policies or any other matter relating to the assessment of risk where the treatment –
is effected by reference to –
actuarial or statistical data obtained from a source on which it is reasonable to rely, or
other relevant underwriting or commercial factors,
is reasonable having regard to the data or other relevant factors
It is submitted that a mortgage or any other loan involves an assessment of risk, said risk being whether the funds borrowed by customers would prove to be recoverable in repayments. It is for this purpose that the Credit Policy exists. As a publicly traded company engaged in the State in the provision of banking and financial services, including credit facilities, and being regulated by the Central Bank of Ireland, the Respondent has a relevant commercial factor to lend responsibly and sustainably in all circumstances, and in ensuring compliance with relevant regulations and in particular the EC (Capital adequacy of Credit Institutions) Regulations 2006 (the “Capital Adequacy Regulations”) and the aforementioned Code in the assessment of a consumer’s ability to repay a credit product, including mortgages.
Failure to Provide Reasonable Accommodation
The Complainant has claimed that the Respondent had failed to provide him with reasonable accommodation.
Reasonable accommodation is provided for in section 4(1) of the 2000 Act and provides:
For the purposes of this Act discrimination includes a refusal or failure by the provider of a service to do all that is reasonable to accommodate the needs of a person with a disability by providing special treatment or facilities, if without such special treatment or facilities it would be impossible or unduly difficult for the person to avail himself or herself of the service.
This provision refers to “the needs of a person with a disability” and this section of the Act makes no reference to persons associated with another person. It is submitted that this unambiguous provision is to be interpreted literally and strictly. As the Complainant is not disabled, this section of the Act cannot apply to him, with the result that the claim of failure to provide reasonable accommodation cannot be made out and cannot succeed as a matter of law.
Claim of Indirect Discrimination
Section 3 (1)(c) refers to the circumstance of where an apparently neutral provision puts a person at a particular disadvantage compared with other persons unless the provision is objectively justified by a legitimate aim and the means of achieving that aim are appropriate and necessary.
It is submitted that there is no lending condition in the Credit Policy that applies disproportionately to disabled people.
Without prejudice to the submission that the Complainant has not suffered from indirect discrimination, it is submitted that the Respondent has a legitimate aim of ensuring viable and secure lending in the interest of the Respondent, its customers as a bank and financial institution subject to Central Bank of Ireland regulation, and that assessing the viability of applicants for AIPs, with reference to the Credit Policy is both appropriate and necessary to ensure compliance with that aim.
The remedies sought should be refused for the reasons submitted above.
Section 41(4) of the Workplace Relations Act 2015 requires that I make a decision in relation to the complaint(s)/dispute(s) in accordance with the relevant redress provisions under Schedule 6 of that Act.
Section 25 of the Equal Status Act, 2000 requires that I make a decision in relation to the complaint in accordance with the relevant redress provisions under section 27 of that Act.
Issues for Decision:
Does this claim come within the remit of the Equal Status Act 2000?
If so has sufficient prima facie evidence of discrimination been presented by the Complainant to require the Respondent advance rebuttal arguments?
Legislation involved and requirements of legislation:
Equal Status Act 2000
Section 5 of the Equal Status Act 2000 provides as set out below.
Disposal of goods and provision of services.
5.—(1) A person shall not discriminate in disposing of goods to the public generally or a section of the public or in providing a service, whether the disposal or provision is for consideration or otherwise and whether the service provided can be availed of only by a section of the public.
(2)Subject to subsections (4) and (4A), subsection (1) shall not apply in respect of—]
(a) an activity referred to in section 7(2),
(c) differences in the treatment of persons on the gender ground in relation to services of an aesthetic, cosmetic or similar nature, where the services require physical contact between the service provider and the recipient,
(d) differences in the treatment of persons in relation to annuities, pensions, insurance policies or any other matters related to the assessment of risk (other than on the gender ground or in any other circumstances to which the Gender Goods and Services Directive is relevant)]where the treatment—
(i) is effected by reference to—
(I) actuarial or statistical data obtained from a source on which it is reasonable to rely, or
(II) other relevant underwriting or commercial factors,
(ii) is reasonable having regard to the data or other relevant factors,
In the case in hand the key issue is one of determining whether or not the Equal Status Acts have been breached by the Bank’s policy in regard to Carer’s Allowance in the mortgage loan application process described in the claim.
The relevant sections of the Bank’s Credit Policy were presented in evidence and the Credit Policy Manger gave oral evidence. The Central Bank guidelines were, in addition, referred to.
It was clear from the evidence both oral and in exhibited e mails /correspondence that the decision on the loan application was based on considered financial and commercial factors. Section (d) (1:11) Relevant underwriting or commercial factors”. The oral evidence from the Credit Policy Manager was persuasive here.
I noted the offer from the Bank, in November 2014, to have the case referred to the Financial Services Ombudsman. The UK case cited by the Complainant was, interestingly, from the UK Financial Services Ombudsman Service
Accordingly taking all the above matters into account I took the view that the Provisions of Section 5 (d) of the Equal Status Act 2000, as set out above, apply and that I have no jurisdiction to hear the claim.
The claim is dismissed.