Employment Law Alert UK – August 2024

Diversity, Equity & Inclusion

Retraction of job offer from Christian social worker was direct discrimination. The Employment Tribunal held that the Claimant was discriminated against on the grounds of his religious beliefs when the Respondent rescinded a job offer which they had made to him. The Claimant is a Christian and qualified social worker. He applied for a role at the Respondent, which is a charity providing mental health services. The Claimant was offered the role subject to receiving satisfactory references. When the Respondent received limited information from the Claimant’s referees, the Respondent carried out an internet search for the Claimant’s name which revealed articles reporting that the Claimant had been dismissed from a social work course after posting derogatory comments about gay and bisexual people on Facebook. The Respondent then rescinded the Claimant’s job offer. The Claimant was invited to a second interview to give him the opportunity to provide assurances to the Respondent, but the second interview did not reconcile the parties and the Respondent did not reinstate the job offer afterwards. The ET found that the withdrawal of the job offer amounted to direct discrimination against the Claimant on the grounds of religion or belief, as his views, rooted in his religious beliefs, were a material reason for the action taken by the Respondent. However, other claims, including harassment and indirect discrimination, were dismissed. The tribunal concluded that while the Respondent’s initial withdrawal of the job offer was too hasty and thus discriminatory, its refusal to reinstate the offer after a second interview was not discriminatory, as it was based on the lack of necessary assurances from the Claimant regarding his suitability for the role. (Ngole v Touchstone Leeds)

EAT remits claim of indirect discrimination arising from the use of small font sizes in documents. The EAT has cast doubt over the ET’s decision to uphold a claim of indirect disability discrimination. The EAT found that the ET’s reasoning was insufficient, particularly regarding the lack of a legitimate aim for the employer's "small font" Provision, Criterion, or Practice (PCP). The Claimant suffers with Apert Syndrome, which impairs her vision, necessitating documents to be in a minimum of 18-point font for her to read them effectively. The Respondent typically used font sizes between 10 and 12 points for its standard documentation (the “small font” PCP). The ET dismissed a claim for failure to make reasonable adjustments due to the employer's lack of knowledge about the employee's disability (the Claimant did not initially inform the Respondent of her difficulty with smaller fonts), but upheld an indirect disability discrimination claim. The Respondent argued that "efficient management" was the legitimate aim for using standard font sizes but the ET found that "there is no legitimate aim, and it cannot be proportionate when the simple thing to do would be to provide documents in larger font". However, the EAT found that the ET had not adequately explained why this was not accepted as a legitimate aim. Consequently, the case was remitted back to the same Employment Tribunal for redetermination, with instructions to clarify the reasoning behind the decision, particularly concerning the legitimate aim and proportionality of the PCP. The appeal highlights the need for clear justification and proportionality analysis in cases of indirect discrimination, especially when standard practices may inadvertently disadvantage employees with disabilities. (Minis Childcare Ltd v Hilton-Webb)

EAT examines treatment of part-time workers. The EAT has upheld the finding of the ET that a part-time private hire driver was not treated less favourably than his full-time counterpart. The Claimant, a part-time private hire driver, challenged the imposition by the Respondent of a flat rate circuit fee of £148, which granted drivers access to the company's booking system. The Claimant argued that this fee constituted less favourable treatment compared to full-time drivers, as it did not consider the pro rata temporis principle, effectively resulting in part-time drivers like him paying a higher fee proportionate to their hours worked or earning a lower hourly rate after the fee deduction. The ET dismissed his claim, concluding that the treatment was not solely due to his part-time status and also focusing on the employer's intention behind the fee imposition. On appeal, the EAT partially allowed the appeal, finding that the ET erred in its approach to less favourable treatment by not adequately considering the proportionality of the fee. However, the EAT upheld the ET's decision on the causation, emphasising that the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 required the less favourable treatment to be solely because the claimant was a part-time worker. (Augustine v Data Cars Ltd)

Employee’s manifestation of gender critical beliefs in relation to preferred pronouns was not protected. The ET dismissed claims of unfair dismissal and discrimination brought by the Claimant, an ICT Project Officer employed by the Respondent from March 2018 to August 2022. The Claimant’s claims arose after he added "XYchromosomeGuy/AdultHumanMale" to his email signature in protest against the Respondent's policy allowing employees to include preferred pronouns in their email signatures. The Respondent viewed this action as potentially offensive and not in line with their inclusion policy, leading to the Claimant’s suspension and subsequent dismissal for serious insubordination after he repeatedly refused to remove the email footer. The ET found Mr. Orwin's gender-critical beliefs to be a protected philosophical belief under section 10 of the Equality Act 2010 but dismissed his claims of direct discrimination and unfair dismissal. It concluded that the Respondent's actions were not due to the Claimant’s beliefs themselves but were a response to his provocative and non-compliant manifestation of those beliefs, which was not protected under the Act. The Tribunal also dismissed the Claimant’s wrongful dismissal claim, agreeing with the Respondent that his refusal to follow a reasonable management instruction constituted a repudiatory breach of contract, justifying his summary dismissal. The ET's decision emphasises the distinction between holding and manifesting a belief, and the differing levels of protection, especially when actions conflict with an employer's inclusion policies. (Orwin v East Riding of Yorkshire Council)

Gender critical barrister loses appeal against Stonewall. In 2022 the ET upheld claims of discrimination and victimisation brought against Garden Court Chambers (GCC) by one of its barristers in connection with her expression of gender critical beliefs. The Claimant’s claims against Stonewall (that they had induced or attempted to induce GCC to take action against her) were unsuccessful. The ET found that Stonewall's actions (lodging a complaint with GCC about tweets made by the Claimant) were merely a protest without a specific aim or threat, and thus did not amount to inducing or causing GCC to discriminate against the Claimant. The Claimant appealed this decision but the EAT dismissed her appeal. The EAT clarified that for a claim under Section 111 to succeed, it must be shown that the accused party (Stonewall) actually caused the discriminatory act due to the protected characteristic. The ET’s findings that Stonewall's complaint was a form of protest without a specific aim or threat meant that it did not satisfy the criteria for causing or inducing discrimination under the Equality Act. The EAT concluded that Stonewall's complaint was a 'but for' cause of the outcome but did not hold Stonewall liable for the discriminatory determination by GCC. (Bailey v Stonewall Equality Ltd and ors)

EHRC launches consultation on updated guidance for preventing workplace sexual harassment. The EHRC has launched a consultation on updates to its guidance for preventing workplace sexual harassment, reflecting the new legal requirements introduced by the Worker Protection (Amendment of Equality Act 2010) Act 2023, effective from 26th October 2024. The guidance offers some helpful insights. It clarifies that the new duty should be seen as an “anticipatory” duty, and highlights the importance of employers also taking steps to prevent against third party harassment. However, in terms of practical steps, it arguably does not go much beyond the 2020 guidance, which remains the best steer for employers when considering next steps. The consultation is open until 6 August 2024.

EHRC publishes guidance on discriminatory adverts. On 6 July 2024 the EHRC updated its guidance on discriminatory adverts. The updated guidance outlines what constitutes a discriminatory advert under the Equality Act 2010 and the process for lodging a complaint if someone believes they have encountered discrimination. The guidance clarifies that while most restrictions are illegal, there are limited circumstances under which specific targeting is allowed, provided it can be objectively justified or meets the criteria for an occupational requirement. It also addresses the concept of positive action, where employers can encourage applications from underrepresented or disadvantaged groups without breaching the Equality Act. The guidance aims to prevent discrimination and promote equality in advertising for jobs, goods, facilities, and services.

Employment status

EAT upholds finding re status of partner. The EAT upheld the ET's decision, affirming the claimant's status as a worker but not an employee. The Claimant was a tax accountant who transitioned from being an employee to a partner at the Respondent accountancy firm. The Claimant asserted that he had said that he would only become a partner if he could review the partnership accounts and agree all the terms. This did not happen, nor was there any written agreement on terms. He was also not provided with information about income or liabilities, and did not make any capital contribution. However, from April 2019 the Claimant ceased to have NI or income tax deducted and accounted to HMRC. The Claimant accepted that he understood the tax implication of being a partner. The ET determined that the Claimant was not an employee under section 230 of the Employment Rights Act 1996 (ERA) because he had effectively entered into a partnership agreement as defined by the Partnership Act 1890 (PA 1890). However, the ET found the claimant was a "worker" under section 230(3)(b) ERA, and upheld his complaint of unauthorised deduction of wages. The claimant appealed against the ET's conclusion regarding his employee status, arguing that the ET erred in finding a partnership agreement and failed to consider all relevant factors, including provisions of the PA 1890. The Employment Appeal Tribunal (EAT) dismissed the claimant's appeal, supporting the ET's multifactorial approach and its weight given to the parties' genuine intention to form a partnership. The EAT concluded that the ET had appropriately considered relevant factors, finding a partnership agreement existed despite the parties not agreeing on all terms initially proposed. (Watson v Johnson and Anor)

Litigation procedure

Practice Direction on ET panel composition. The Senior President of Tribunals (SPT) has introduced a draft Practice Direction on panel composition for the ET and EAT set to take effect from 29 October 2024. This marks the first use of the SPT's new authority to determine tribunal panel composition. The direction mandates that an employment judge will decide the makeup of the tribunal panel for final hearings on an individual basis, with preliminary hearings generally conducted by a single judge unless otherwise determined. This new approach aims for a neutral stance, allowing decisions on panel composition to be tailored to the specifics of each case, considering factors like the nature of evidence and the issues at hand. Feedback on this guidance is being sought from national user groups until 6 September 2024.

AI

EU AI Act published in Official Journal. On 12 July 2024 the EU AI Act was published in the Official Journal of the European Union and will enter into force after 20 days. The Act will be fully enforceable from 2 August 2026, with certain provisions, including those on prohibited AI systems and penalties, taking effect earlier in 2025. This will apply to EU Member States only, not the UK. For more detailed discussion of the Act and what it means for employers see our Insight.

Workers’ rights

Labour government’s legislative agenda includes Employment Rights Bill. In the State Opening of Parliament, the King announced the Labour Government's legislative agenda, which includes significant employment law reforms aimed at enhancing worker protections and promoting equality. Of particular note, the King’s speech confirmed Labour’s commitment to the “Employment Rights Bill” which is expected to be introduced within Labour’s first 100 days in office. The King’s speech also referenced the Equality (Race and Disability) Bill which will mandate ethnicity and disability pay reporting for large employers and bolster equal pay rights for ethnic minorities and disabled individuals, facilitating pay discrimination claims. We offer employment related insight and analysis of policy developments here and catch up our latest webinar to hear our panel of experts give their immediate response to the election outcome here.

Statutory Code of Practice on Dismissal and Re-engagement enters into force. The statutory Code of Practice on dismissal and re-engagement, also known as 'fire and rehire', took effect on 18 July 2024. Employment tribunals are expected to take this Code into account, which could result in up to 25% compensation adjustments if not adhered to. The Labour government may implement a stronger code and new laws to eliminate 'fire and rehire' practices (except in specific situations) as this featured in the King’s speech.

Other interesting things

Supreme Court deems EU law based cause of action to be retained EU law following Brexit. This significant Supreme Court decision, addresses significant questions about the application of EU law rights that accrued before Brexit, albeit not in an employment law context. The claim concerned two individuals who sought to claim compensation due to a cancelled flight from Milan Linate Airport to London City Airport on 30 January 2018. The airline sought to argue that no compensation was payable because the cancellation was caused by the pilot’s illness and that this constituted "extraordinary circumstance" under Regulation (EC) 261/2004. This regulation entitles passengers to compensation for cancelled flights unless the airline can demonstrate that the cancellation was due to extraordinary circumstances beyond its control. Both the Court of Appeal and the Supreme Court disagreed, emphasising that staff illness is inherent in the normal activity of an air carrier. Most importantly the Supreme Court's decision, addressed significant questions about the application of EU law rights that accrued before Brexit. The Court clarified that the cause of action under EU Regulation 261 should be considered as retained EU law. (Lipton and anor v BA Cityflyer Ltd)

ACAS publishes tips for employers during Olympics. On 22 July 2024 ACAS released guidance for employers to help deal with potential issues arising during the 2024 Paris Olympics, emphasising the importance of establishing clear agreements on time off, sickness absence, and the use of websites and social media during work hours. Acas Chief Executive, Susan Clews, highlighted the need for maintaining productivity and staff morale through flexible arrangements and fair policies, ensuring businesses remain operational while accommodating employees' interest in the Olympics. The advice includes considering flexible working hours, allowing breaks during popular events, and being consistent in handling leave requests and shift swaps, aiming to foster a supportive and productive work environment.