Discrimination ruling overrules 'all reasonable steps' defenceby
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.
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.
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Barry Ross, director and partner at Crossland Employment Solicitors, has been practising Employment Law since 2006 when he worked in-house for major legal expenses Insurance provider, DAS. There, he provided employment law advice across a whole spectrum of issues to commercial and individual clients. Barry provides commercial advice on all...