What does the decision in Pal v Accenture UK Ltd mean for employers?

The decision of the Employment Appeal Tribunal (EAT) in January 2026 in Pal v Accenture (UK) Ltd has two important lessons: one is for employers managing long-term health conditions in the workplace and the other relates to the fairness of the policy of ‘up or elsewhere’.

The case considered:

• how Ms Pal’s endometriosis should have been assessed alongside capability and dismissal processes; and
• the correct interpretation of substantial and long-term adverse effect on day-to-day activities when considering disability discrimination claims.

The facts

Ms Pal brought a claim against Accenture for disability discrimination including failure to make reasonable adjustments, and unfair dismissal.

She had been a manager at Accenture, a professional services firm. Accenture had operated a modern performance-management model, where employees must progress or face dismissal (known as an “up or elsewhere” framework). Accenture had assessed her as not progressing towards the next grade and so had dismissed her.

Ms Pal had suffered from endometriosis, a chronic inflammatory condition commonly causing severe pelvic pain, fatigue, digestive symptoms, and cognitive effects and the symptoms of which may fluctuate but often persist for years. Her symptoms were significant enough to cause repeated absences from work and periods of reduced capacity, and she underwent an operation shortly before her dismissal. Ms Pal brought claims in the Employment Tribunal (ET) which were not upheld. In her EAT appeal she argued that her endometriosis qualified as a disability, that Accenture had actual or constructive knowledge of it, that reasonable adjustments were not properly considered, and that the ET had failed to assess the substantial, long-term effects of her condition and its role in her dismissal.

Endometriosis as a disability

A central issue to be decided by the EAT was whether Ms Pal’s endometriosis amounted to a disability under the Equality Act 2010. Under the Equality Act 2010, a person is disabled if they have a physical or mental impairment which has a substantial adverse effect on their ability to carry out normal day-to-day activities and which is long-term (lasting or likely to last at least 12 months).

The EAT found that the ET’s reasoning that Ms Pal’s day-to-day activities were not adversely affected by her endometriosis was unsound, and, importantly, rejected the suggestion that periods of relative improvement meant the condition was not long term or that it would not recur. The fact that symptoms were cyclical and came and went does not on its face prevent the condition from meeting the statutory definition.

The ET also failed to consider Ms Pal’s condition if she had not had medical treatment for her condition. This aspect of the judgment is particularly significant for employers managing fluctuating conditions.

Reducing compensation

The EAT overturned the ET’s assumption that, even if the right process was not followed, dismissal for not being “promotion ready” is automatically a fair reason.

It held that the ET should have considered what would or might have happened if Accenture had complied with its procedures – including whether Accenture would or might have fairly dismissed Ms Pal after a proper investigation with independent decision makers – not speculated that it would simply have introduced a different procedure to match what it did in practice.

The Polkey reduction, where it is determined that there is a likelihood or certainty that the employee would have been dismissed had their employer acted fairly, that the ET imposed upon the award was incorrectly applied because the ET had analysed what it would have done rather than looking to the employer to prove what it would have done had it had the opportunity to correct its error.

The EAT found that you can only reduce compensation via a Polkey reduction if a fair process might have led to the same outcome and not just assume that it would have done.

What this means for employers

The decision reinforces several important principles:

• Endometriosis can amount to a disability where symptoms are substantial and long term.
• Fluctuating conditions may still amount to a disability if their overall effect meets the statutory test. Any assessment will look at the overall impact of the condition, not isolated days of absence. Severe cyclical pain and fatigue can amount to a substantial effect even if symptoms vary in intensity.
• Promotion-based dismissals are not always “capability” issues.

If an employee is performing well in their current role, dismissing them solely for not being promoted is unlikely to be fair unless it is justified under the potentially fair reason called “Some Other Substantial Reason (SOSR)” and handled with a robust, transparent process.

What employers should do

To reduce the risk of unfair dismissal and disability discrimination claims involving chronic conditions such as endometriosis, employers should:

• Seek clear medical evidence early: obtain occupational health advice focused not only on diagnosis but on functional impact and recommended adjustments. Ensure that relevant medical evidence is kept up to date and addresses ongoing limitations/impacts, and likely timescales, and that employees have been given the chance to explain how their condition impacts them.
• Consider fluctuating symptoms: avoid assuming that improvement means recovery.
• Explore meaningful reasonable adjustments: these may include flexible and/or remote/hybrid working arrangements, adjusted hours, temporary reduction in performance targets, phased returns, redistribution of specific tasks, and modified absence trigger points.
• Separate disability-related absence from misconduct or general performance issues: failing to distinguish between the two can render a dismissal unfair and discriminatory.
• Follow a fair and well-documented process: consult with the employee, consider alternatives to dismissal, and ensure that any decision is proportionate.
• Managers should receive training on invisible health conditions and employers should ensure that all staff use discretion when dealing with an employee’s chronic health conditions. Keep a record of all communications so that the employer’s actions are documented. Employment tribunals will be interested in not only what was done but also what was considered or offered.
• Review policies: Ensure equality, sickness absence, and capability policies address chronic health conditions.

Foster a supportive workplace culture; organisations that cultivate a culture of openness and support are less likely to encounter adversarial disputes and are more likely to retain skilled employees.

In relation to career progression:

• Employers must ensure promotion and dismissal criteria are clear and consistent in their contracts and policies.
• If an employer wants to seek to rely on “up or elsewhere” then they need to ensure their procedures are fair, well-documented, and in line with employment law or they will risk unfair dismissal claims.

Pal v Accenture UK Ltd sends a clear message to employers about handling long-term health conditions with care. Employers must look beyond absence statistics and engage meaningfully with reasonable adjustments.

This case is a wake-up call for employers to review how best to manage career progression and exits. Employers should seek legal advice when dealing with employees with potential chronic health conditions so that a structured, evidence-based approach can be adopted and litigation risk reduced.

If you have any questions or concerns about unfair dismissal and/or health conditions in the workplace, please contact Employment lawyers Emma Clark and Imogen Dale.