Director and partner at Crossland Employment Solicitors
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Discrimination ruling overrules 'all reasonable steps' defence

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A recent employment tribunal case has acted as a warning over the ‘all reasonable steps’ defence for companies trying to defend discrimination claims. Barry Ross explains how implementing diversity training can be a defence for an employer.

17th May 2021
Director and partner at Crossland Employment Solicitors
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The recent Employment Appeal Tribunal decision in Allay (UK) Limited v Gehlen, acts as a warning to all businesses about their approach to any ‘all reasonable steps’ defence when defending discrimination claims. 

But it is important to be clear of the laws around discrimination and what steps accounting businesses should take to help ensure their employees don’t end up being called to a tribunal.

Equality Act 2010

The Equality Act 2010 (The Act) seeks to protect employees with protected characteristics from being treated unfairly in the workplace. The protected characteristics are age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, sexual orientation. 

Discrimination comes in many forms and The Act seeks to protect against a wide range of discrimination. Types included (though not exhaustively) are; 

  • direct discrimination (treating someone with a protected characteristic less favourably),

  • indirect discrimination (an employer enforces a provision criterion or practice which puts people with the protected characteristic at a particular disadvantage to those who do not have), and 

  • harassment (subjected individuals to unwanted conduct which violates their dignity or creates an environment that is intimidating, hostile, degrading, humiliating or offensive to someone because of their protected characteristic). 

As well as protecting against discrimination, The Act can even go so far as to encourage positive action in respect of recruitment to help remedy disadvantage or underrepresentation. In addition to covering the types of discrimination which can occur, it sets out some statutory defences to actions that would otherwise be potentially discriminatory. 

For example, knowledge of a protected characteristic can be a defence because you cannot treat someone less favourably because of that characteristic if you are unaware that they possess it. 

Occupational requirements for particular jobs may be deemed to be a ‘proportionate means of achieving a legitimate aim’. For example, an actor of a particular sex, ethnicity or race may be required for a role, or an Imam being needed for Islamic worship. 

Employer liability and ‘all reasonable steps’

It is important to understand that an employer is liable for acts of discrimination, harassment and victimisation carried out by its employees in the course of employment: 

‘anything done by a person (A) in the course of A’s employment must be treated as also done by the employer’ – s. 109(1) of The Act. Whether the actions were done with the employer’s knowledge or approval does not matter. 

While this may seem unduly harsh, one of the potential defences to discrimination, harassment and victimisation is known as the ‘all reasonable steps’ defence. This means that even where an employee has discriminated against another person, an employer can be absolved of their vicarious liability if it can show that it took all “all reasonable steps” to prevent an employee from discriminating against another person. 

Allay (UK) Limited v Gehlen

The recent decision of Allay (UK) Limited v Gehlen has brought this defence into the headlines. Mr Gehlen brought claims for discrimination against his employer, including harassment because of his race and the Tribunal upheld the harassment complaint in spite of the fact that the employer had implemented harassment training. The company in question appealed to the EAT, however, the EAT dismissed the appeal.

The EAT decided that even though the employer had implemented training to its staff and that this specifically relating to harassment, it had taken place two years earlier and had become “clearly stale”. 

The argument was demonstrated by the fact that the employee who racially harassed Mr Gehlen considered his actions as ‘banter’, the employees who overheard the harassment did nothing and the managers took no action either. In the circumstances, refresher training would have been a reasonable step to take on the part of the employer.

Discrimination cases can be costly with potentially unlimited awards being made against employers and employees including compensation for injury to feelings on top of losses incurred. The ability to rely on a statutory defence can therefore be a welcome measure to minimise risk for accounting businesses and clients. 

What steps can you take? 

It is important to do everything you can to protect against discrimination from happening within your own and your client’s business. This includes fostering an equal opportunities culture by implementing equal opportunities policies, but also ensuring that those policies are read (and understood) by all staff and updated regularly. 

Ensure training on these policies is implemented on a regular basis because as the Gehlen case shows, training once every few years is not likely to be enough to fulfil this requirement. You need to look at annual refresher training as a minimum.

It is also important to remember that where discrimination does occur, accounting businesses and their clients should be seen to take appropriate action with the offenders, delivering a clear message that any discriminatory behaviour will not be tolerated. 

Replies (5)

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By Paul Crowley
18th May 2021 10:08

How can anyone ever take ALL reasonable steps? Whatever is done, there will always be another step that could be seen as reasonable.

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Replying to Paul Crowley:
By Duggimon
18th May 2021 10:14

Well, taking things to the extreme you are right, however in this specific case the employer deemed "absolutely nothing whatsoever" to be "all reasonable steps" and then when taken to a tribunal relied upon a training course from two years ago.

Perhaps doing "literally anything at all" when an employee complains about racist abuse in the workplace would help when making the "all reasonable steps" defence.

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By dmmarler
18th May 2021 11:55

The legislation now is far better, and I for one am pleased to see the Court is taking an objective view of the matter. If we allow people to rely on the defence of "banter" then all types of discrimination will persist and we will not have a good and diverse workforce for the country.

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By Ian McTernan CTA
19th May 2021 13:34

Just one more reason not to have any employees, for which I am forever grateful.

It's crazy that employers are responsible for all their employee's actions (rather than the employee themselves) and we've devolved into a 'blame and claim' culture.

The sheer cost of keeping employees 'current' must be enough to put a lot of people off employing anyone. How can any employer keep everyone 'current' if two years is too long a gap between 'training' courses.

Just to make it clear, I do not condone the employee's actions and Mr Gehlen should not have to suffer any abuse, especially racial, disguised as 'banter'. But making employers responsible won't solve the issue. You solve the issue by dealing with the employees- but more importantly, looking at where they were brought up and educated and what influenced them to become what they are today. No dry training course for adults will stamp out racism- all it does is teach them to suppress what they will say. Showing the results of racism is much more likely to change their attitude.

Until we learn not to compartmentilise people immediately, stop judging others and start looking at commonalities rather than differences then people will always be racist, etc as human nature is to put people in boxes in their heads. People will judge you by your appearance within milliseconds and put you in a box, and people need to learn to resist this impulse.

More people need to learn a basic fact: it's underneath that matters, judge a person on their actions not their appearance.

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Replying to Ian McTernan CTA:
By Duggimon
04th Jun 2021 11:40

You've completely missed the point. The employer is not responsible for the employee's actions and that's not what the tribunal found. The employee is responsible and the employer, once they are made aware, needs to do something about it.

The something could be disciplinary action, or could be sending the offending employee to further training. A reasonable response should be anything other than what the employer did, which was listen to the complaint then do nothing at all whatsoever.

You can't say it's nothing to do with the employer once a complaint is made to them about their employee's behaviour in the workplace. It is absolutely their responsibility to do something to actually react to it. Nobody is saying they should have proactively taken steps to ensure that this could never have happened in the first place, that would be impossible. Nor should they be criticised over the fact it did happen. They are only at fault because once it did happen, and it was reported to them as it should have been, they did nothing.

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