Appealing for ESA arrears

Issue 218 (October 2010)

CPAG examines what claimants should do if they believe they have not been paid all the arrears they are due following a successful employment and support allowance (ESA) appeal.

CPAG has received a steadily increasing number of enquiries from advisers regarding claimants who are winning employment and support allowance (ESA) appeals but finding they are not being paid all the arrears they believe they are entitled to.

Several groups of claimants may have to claim jobseeker’s allowance (JSA) pending an appeal regarding limited capability for work – for example, those who are unable to obtain further medical certificates following a decision that they have failed the work capability assessment (WCA), or those appealing against a decision to treat them as not having WCA following their failure to attend a medical examination or return the ESA50. Others may have claimed JSA after failing the WCA and only later decided to pursue an appeal.

The common situation reported on our advice line is as follows:

  • ESA claimant fails the WCA. S/he appeals the decision and claims JSA while the appeal is pending.
  • Claimant is successful at the First-tier Tribunal; the original decision is over- turned. Entitlement to ESA is reinstated, with either the work-related or support component awarded, depending on the tribunal decision.
  • However, the DWP does not pay arrears of ESA going back to the date of the original decision.

Claimants and advisers in this situation have been told by the DWP that while the claimant’s award of ESA has to be reinstated after a successful appeal, because the claimant received JSA pending the appeal, s/he is not due any arrears of ESA.

The apparent reasoning for the DWP decisions can be found in DMG Memo 33/10. The memo was issued to give guidance on the implementation of the Social Security (Miscellaneous Amendments) (No.3) Regulations 2010 (see Bulletin 216) effective from 28 June 2010.

The memo states at paragraph 43:

‘If the claimant has been awarded JSA, they cannot be awarded arrears of ESA for the same period even if they make an appeal against the ESA disallowance, or the FtT allows the appeal.’

The authority given for this is regulation 31(1) of the ESA Regulations 2008, which provides that a claimant who claims JSA and is able to show that s/he has a ‘reasonable prospect of obtaining employment’ shall be treated as not having limited capability for work, even if is determined that s/he does have limited capability or is treated as having limited capability. As it is clear that the claimant cannot be entitled to both JSA and ESA at the same time (section 1(2)(f) of the Welfare Reform Act 2007), such an approach leaves the claimant ‘stuck’ with an award of JSA, for the period from the original DWP decision that s/he failed the WCA to the date on which the DWP reinstates ESA following the tribunal decision. This is not what CPAG had previously understood to be the position of the DWP. We had been advised that claimants would indeed be able to recover arrears in his situation.1

Accordingly, CPAG wrote to the DWP to seek clarification. Following its response, our understanding of its position is that it always intended to be able to pay arrears in the situation described above, and that remains the policy intention, but that the legislation (in particular ESA regulation 31) means that it is not necessarily possible. For this reason the Government intends to revoke regulation 31 later this year, at which point it believes the law will allow the payment of arrears.

Revision powers

CPAG believes that this is both wrong and unfair. The approach of the DWP leaves claimants at the mercy of bad decision making and delays in the processing of appeals. The longer it takes for an appeal to be heard, the more money the claimant will lose (see example).

CPAG believes that following a successful appeal to the First-tier Tribunal, the DWP should revise the decision to award JSA in the light of the tribunal’s decision that the claimant has had limited capability for work and has been entitled to ESA throughout. This can be done using revision powers contained in regulation 3, in particular regulation 3(5A) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999. It is important to note that, for ESA, the decision of the tribunal is a decision to reinstate ESA, not just a decision that the claimant has limited capability for work. The tribunal’s decision replaces the DWP’s original decision to stop ESA.

So, specifically with reference to Reg 3(5A) above, if the DWP had been aware of the decision of the tribunal when it made a decision on the JSA claim, it would have refused the JSA claim, as the claimant was entitled to ESA. Accordingly, it can now revise the decision to award JSA, refuse it on the basis the claim was in fact entitled to ESA at that time, and pay arrears of ESA. The amount of arrears due pending a successful appeal will of course depend on the circumstances of each case, and would be offset by any JSA already paid.2At present, the DWP does not agree that revision is possible at all, due to regulation 31 of the ESA Regulations. Once that is revoked, it envisages doing revisions to allow payment of arrears under regulation 3(1), although it does not accept that revision is possible under regulation 3(5A) or (for official error) regulation 3(5)(a) at any point.

It is also worth highlighting that regulation 31 of the ESA Regulations requires the claimant to have a ‘reasonable prospect of obtaining employment’ as well as having been awarded JSA. Claimants of JSA are allowed to place any restriction on their availability for work that is reasonable in the light of their physical or mental condition, regardless of whether this leaves them with any reasonable prospects of getting a job (regulation 13(3) Jobseekers Allowance Regulations 1996). It is arguable, therefore, that many of the claimants who have been refused arrears may, in fact, have placed restrictions on their availability, which may fall within regulation 13, and so they may not be caught by regulation 31 of the ESA Regulations.

Revision request letter

Any claimants affected by this issue should, after having their ESA reinstated at the tribunal, request that the DWP revise its decision to pay JSA and pay the arrears of ESA that are due. The letter to the DWP should state that:

  • The original decision to disallow ESA on the grounds of not having limited capability for work has been replaced by the tribunal decision that they do have limited capability for work and were in fact entitled to ESA throughout.
  • The decision to award JSA, therefore, cannot stand as the claimant was entitled to ESA, which precludes entitlement to JSA. That decision should, therefore, be revised in the light of the tribunal decision, enabling arrears of ESA to be paid.
  • Such a revision decision is required in particular by regulation 3(5A) of the Social Security and Child Support (Decisions and Appeals) Regulations 1999. Any other interpretation of that regulation which denies the claimant her/his full arrears could infringe her/his rights under the European Convention on Human Rights (ECHR), as it means s/he could never get her/his full entitlement to ESA despite winning an appeal over what is a possession under the ECHR. The practical problem for claimants is that if the DWP refuses to revise under regulation

3(5A), there is no effective right of appeal against that decision. The remedy would be judicial review. Advisers with clients in this situation can contact the CPAG advice line; we would be interested in pursuing a case on this issue.

Example

Bob claims ESA and at week 20 of his claim a decision is made that he doesn’t have limited capability for work following his assessment under the WCA. Bob claims JSA immediately after the decision and then, following advice, decides to lodge an appeal. It takes a while for his appeal to be processed and it is not until week 40 of his claim that he attends a First-tier Tribunal hearing and is successful. He is put in the work group. His ESA is reinstated, including the work-related activity component, but the DWP follows DMG Memo 33/10 and refuses to pay him arrears.

Bob believes he is entitled to arrears of the work component from week 14 of his claim (26 weeks x £25.95pw = £674.70). CPAG believes he should be entitled to those arrears. He should write to the DWP asking for arrears on the grounds referred to in the article. As Bob is in receipt of income-related ESA, he is eligible for legal aid. If the DWP refuse to pay arrears he can instruct a solicitor to pursue judicial review proceedings against the DWP.

 


Please be aware that welfare rights law and guidance change frequently. Therefore older Bulletin articles may be out of date. Use keywords or the search function to find more recent material on this topic.

  • 1. Email to CPAG from DWP, 15 October 2008
  • 2. Reg 5 Social Security (Payments on account, Overpayments and Recovery) Regulations 1988