The Queen on the application of Sheila Winder, Lisa Marie Dowen and Sarah Hampton v Sandwell Metropolitan Borough Council,  EWHC 2617 (Admin)
Claimants who financially qualified for a reduction in tax liability were denied, based on a two- year residency requirement in a specific locality. The UK High Court of Justice struck down the residency requirement on multiple grounds including that the requirement was outside statutory authority, discriminated against women and non-UK citizens, violated the right to freedom of movement, and did not comply with a required consultation with affected parties.
The Sandwell Metropolitan Council formed a new tax plan pursuant to a national change in tax law. Previously, low-income persons would be given financial assistance to pay council taxes, whereas under the new plan, individuals’ tax liability was lowered based on financial status. The relevant statute stated that local authorities would create locally-tailored plans to determine tax liability by creating classes based on income, capital, and number of dependents. The plan was to be published as a draft, and the local authority was required to consult with interested parties. The Sandwell Council formed a draft plan, which did not include the residency requirement, and organized a public consultation. It was at the last hearing before the full Council that a member proposed a two-year residency requirement to discourage individuals from moving from areas with high property values to areas with lower property values, in pursuit of lower tax liability. The measure passed without substantial discussion and no public consultation. Prior to the lawsuit, 3,600 people were denied lower taxes because they did not meet the residency requirement.
The residency requirement was challenged by three women. One of the women, Sheila Winder, in her early 50s, was born in Sandwell and lived there for most of the first 46 years of her life. In 2008, she was forced to move a few miles away to neighbouring Dudley because she was suffering from domestic abuse, and she eventually became homeless and was moved by Dudley council to a women-only hostel in Sandwell. The two other women also lived in Sandwell for most of their lives, but not portions of the two years prior to the tax plan, one facing housing instability due to worsening mental illness, and the other having recently been widowed. Each of the women were on extremely limited incomes but had been denied lower tax liability due to the residency requirement. They asserted that the requirement was outside of the legitimate purposes of the statute, and alternatively, that it was irrational, and resulted in indirect discrimination against women, victims of abuse, and non-EU citizens and refugees (pursuant to European Union law, section 19 of the Equality Act, and Article 14 of the European Convention on Human Rights and its First Protocol).
The Court agreed with the women that the statute unambiguously states that classes must be defined by financial need, and public bodies creating the classes are bound by the statute. It was not legitimate for the Council to impose the residency requirement to avoid subsidizing individuals who financially qualify for lower tax liability. The clear intent of parliament was to care for those in need, and if the residency requirement spread, it means people could choose to go on public benefits rather than move, and it could make it difficult for people to escape abuse or care for ill family members. The Court further held that the lack of consultation rendered the procedure leading to the residency requirement unlawful. Considering discrimination, the Court held, among other things that the residency requirement is indirectly discriminatory against women, because women are substantially more likely than men to suffer from domestic violence which might compel them to flee to a different local area, those fleeing often have very limited resources, and a person fleeing to Sandwell will not meet the residency requirement.
Additionally, the requirement was illegal because there was no evidence even one individual had moved to take advantage of better tax benefits, and the requirement had been adopted without any real debate or consideration of the consequences.
As a result of the judgment, Sandwell removed the two-year residency requirement (Email interview with Carla Clarke, Solicitor, Child Poverty Action Group, June 25, 2018). In addition, two other Councils (Tendring and Basildon) which had adopted minimum local residency rules have ceased to apply them.
The Equality and Human Rights Commission
Child Poverty Action Group
The judgment positively affected the lives of tens of thousands of low income council tax payers who were previously denied assistance in Sandwell as well as in other local authority areas with similar council tax reduction schemes. The case reaffirms that a core objective of social protection must be to effectively support the most vulnerable in our societies.
Moreover, this case strongly underscores the human rights principle of participation, encouraging genuinely participatory decision-making through a process of public consultation. On the issue of participation, UN resolution 33/22 called for draft guidelines on the effective implementation of the right to participate in public affairs, urging states to take measures including promoting the inclusion of all citizens in public affairs, in particular women, minorities and persons belonging to marginalized groups and in vulnerable situations.
The examination of indirect discrimination in this case foregrounds the linkage between particular issues that predominantly women confront – for example domestic violence – and housing instability, which in turn negatively impacts enjoyment of a range of other rights, including access to social protection systems. In terms of scale of the problem, 1.2 million women faced domestic violence in 2017 in the UK. The WHO estimates that worldwide almost one third (30%) of all women who have been in a relationship have experienced physical and/or sexual violence by their intimate partner. Such violence frequently compels women to flee their homes and is a leading cause for homelessness for women. Other women lacking safe housing alternatives stay trapped in an abusive environment of often escalating violence. Security of tenure and access to housing are key cornerstones of the human right to adequate housing, as outlined in CESCR’s General Comment No. 4. In line with international human rights law, States must provide victims of violence access to services, including housing. This case is an important reminder that we need to draw on the principle of indirect discrimination as part of a broader substantive equality analysis, and adopt a comprehensive understanding of the experience of gender based-violence, to effectively secure women’s rights, including their right to housing.
For their contributions, special thanks to Child Poverty Action Group and ESCR-Net members: Program on Human Rights and the Global Economy (PHRGE) at Northeastern University and JustFair UK.
Last updated on 9 July 2018
 Indirect discrimination occurs when a law or policy appears to be neutral, but has a disproportionate adverse impact based on a prohibited ground for example race and gender.