People law in brief - September 2011

Welcome to this month’s edition of People Law in Brief.

Following the success of our bespoke training modules, we are pleased to announce a programme of public training events which focus on key people management skills. The first event is on 20 October 2011 and will focus on helping managers address poor employee performance. Each event is held at our offices and we currently have a “buy one, get one half price offer” for any delegate places booked. See T&E Advance for more information.

Training your managers to have skills and confidence to manage staff can be a very cost effective way of supporting the policies and procedures you have in place. As you will see from the cases we cover in this month’s People Law in Brief, proactive steps to avoid claims, such as training or keeping policies updated and well communicated, really are worthwhile.

Focus point

Discrimination and Harassment – prevention is better than the cure

Discrimination claims can result in high compensation payments and expensive litigation as there is no limit to the amount of financial loss that can be awarded in a successful case. Not only could there be a financial burden on employers for not fully considering discrimination but also allegations of discrimination and harassment are likely to create bad publicity for an employer and have a detrimental effect on employee morale. Individual managers can also be named respondents.

If discrimination or harassment is found to have taken place, there are no grounds for justification. The only grounds on which an employer can avoid liability is if it can show that it took all reasonable steps to ensure that the harassment or discrimination did not take place. So, prevention is better than curing existing issues that arise.

Name calling or workplace banter are a common source of claims in this area and, by way of example, it has been recently reported that an Employment Tribunal, in the case of Ruda v Tei Ltd, held that using the name "Borat" to refer to someone from Eastern Europe amounted to direct race discrimination.

In July 2007, Mr Ruda, who is Polish, began working for Tei Ltd. In 2010, he brought a number of claims against the company, including race and sexual orientation discrimination. Mr Ruda claimed that, he had been given the nickname "Borat", the name of the film and television character created by Sacha Baron Cohen. The Tribunal held that Mr Ruda had been harassed on the grounds of race by a colleague calling him "Borat" and that the use of the nickname was racial harassment, creating a degrading and humiliating working environment for him. The nickname also constituted direct race discrimination.

The judgment explained that someone who had all the characteristics of Mr Ruda but was neither from Poland nor perceived to be of Eastern European origin would not have had the nickname applied to him.

This case should act as a warning for employers. Employees and managers need to be reminded that it can be race discrimination to harass or treat someone less favourably on the basis of nationality, which is given the same protection under legislation as the colour of someone's skin. Giving an employee a nickname based on their country of origin, or stereotypes from that part of the world, risks a finding of harassment and direct discrimination.

Harassment and discrimination in the workplace can have a significant detriment on a workplace, causing employees to suffer both emotionally and physically and cannot go unnoticed. It is a bigger risk area now that discrimination relating to being associated with, or being perceived to have, a protected characteristic such as race or age is unlawful. This could perhaps be because it is not understood to be unacceptable or sensitive to employees.

Cases like this emphasise the need for companies to take every available step to protect themselves and employees from the impact of discrimination. Employers need to ensure that they have measures in place to deal with the issue of harassment and discrimination. Not only should they be ensuring that they have an equal opportunities policy in place but that they are also providing training so that employees are fully aware of both the employer’s stance on the issue and the consequences of failing to meet it. Not least will this act as a means of protecting employers but, in the event of a discrimination claim, employers are more able to show that they took reasonable steps to prevent such issues occurring and potentially avoid liability at a time when discrimination claims are increasing (see below).

Briefcase news

The recent Employment Appeal Tribunal case of Fox v Ocean City Recruitment Ltd 2011 emphasised the need for employers to take reasonable steps to prevent harassment in the workplace and confirmed when those reasonable steps must be made. If they fail to take such steps they may be held to be vicariously liable for the actions of their employees and may be ordered to pay compensation.

In this case Ms Fox, was subjected to sexual harassment by a colleague, Mr Ellis. Following a complaint to her employer, Mr Ellis was called to a disciplinary hearing and was subsequently suspended while investigations took place. After investigating the matter, the employer concluded that there was insufficient evidence to discipline or dismiss Mr Ellis for sexual harassment. An earlier Employment Tribunal had concluded that Mr Ellis had sexually harassed Miss Fox. However, it held that the employer had a defence to her claim for sexual harassment on the basis that, as soon as Mr Ellis’ misconduct was reported, it took all reasonable practical steps to prevent such behaviour recurring. The step taken was the suspension of Mr Ellis. The EAT, however, said that such a defence can only be made out if reasonable steps were taken before the act complained of.

Simply taking steps after the event to prevent its recurrence is insufficient. This again emphasises the importance of employers not only having clear written policies relating to sexual discrimination and harassment but also for employers to train their staff in these areas to demonstrate a proactive approach and ensure that there is an acceptable workplace culture of complying with such policies. As a minimum this will help establish that reasonable steps have been taken to prevent sexual harassment in their workplace.

The Court of Appeal has held in Grant v HM Land Registry and Equality and Human Rights Commission 2011 that a gay employee, who had revealed his sexual orientation at his previous office, was not discriminated against at his new office when his manager, who had worked with him at his previous office, mentioned his sexual orientation to and in front of, colleagues. He alleged his manager subjected him to various acts of sexual orientation discrimination and harassment. The employment tribunal upheld six claims of direct discrimination, five of which also amounted to harassment. However, the Employment Appeal Tribunal (EAT) held that the tribunal had failed to have regard to the fact that the employee had “come out” in his previous office and that this ought to have been central to the legal analysis. The employee took the case to the Court of Appeal, in a bid to restore the tribunal’s original decision.

The Court of Appeal concluded that the fact that the employee had “come out” at his previous office did not mean that remarks or references to his sexuality thereafter could not constitute discrimination as “everything depends on the particular circumstances”. However, the fact that he had come out previously was a “highly significant factor”, regardless of whether or not his manager knew that this was the case. The Court observed that, if the employee’s new colleagues had been informed by a former colleague that the employee was gay, it would be “bizarre” if that employee could, by the mere innocent disclosure of that information, be liable for either direct discrimination or harassment. Such a disclosure would still have been unwanted by the employee, but it would “make a mockery of discrimination law” to impose liability in that circumstance. By putting facts about his or her private life into the public domain, the employee took the risk that he may become the focus of conversation or gossip and although he may feel “uncomfortable” to a reference relating to his personal life, he was not put to a detriment and therefore couldn’t succeed in his claim for direct discrimination or harassment.

Employers could minimise the risk of such claims by putting procedures in place to ensure that information, such as sexuality, remains confidential if that is what the employee wants. If, however, that employee then tells other people, this case becomes relevant. Employers can also minimise upset from gossip about a person’s sexuality by having clear communication of diversity policies to demonstrate the importance of having respect to all individuals’ sensitivity to personal attributes or factors.

Taylor&Emmet run bespoke training on discrimination and harassment, tailored to your organisation and its policies. If this is an area of concern for you, then please contact me for a quote or further information.

Watch this space

Annual statistics have shown that for April 2010 to March 2011, the number of Employment Tribunal claims fell by 8% when compared with 2010 but this represented a 44% increase on claims in 2008/2009. However, the number of claims which were disposed of increased by 9% from last year so more cases are being dealt with. Of those, only 12% were successful, 32% withdrawn and 29% settled.

Also:

• The number of unfair dismissal and redundancy claims fell slightly;
• Claims under the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 nearly tripled;
• Age discrimination claims rose by 32%; and
• The average award for unfair dismissal was £8,924 and for discrimination was £8,515 (religious) and £14,137 (disability). The average award for age discrimination claims was the highest of the discrimination strands at £30,289, probably due to the difficulties which older workers have in securing alternative work and pension loss.

It is obviously important to not read to much into these statistics but they do give a good indication of trends. Age discrimination, for example, is obviously being more common as a ground of complaint and is a particularly costly one. With the abolition of default retirement, we believe this is likely to increase in future years so it serves as a good reminder to:

1. Ensure that your retirement policies are updated;
2. Ensure that your managers are aware of the implications of the removal of the statutory retirement age and how important it is to manage all workers, regardless of age, consistently including poor performance. We are running a training session for line managers on how to manage poor performance on 20 October and shall be covering this point. If you are interested, see T&E Advance; and
3. If you are thinking about asserting a normal retirement age, consider carefully whether it can be justified. With our self-diagnostic tool, you can map out initial justification grounds and, from there, you need to get the evidence together now. An Employment Tribunal will expect this to be justified based on evidence at the time of setting the normal retirement age, rather than evidence complied purely to defend an Employment Tribunal claim. Please contact me if you want further information or guidance.

And finally......

The majority of this edition of People Law in Brief has centered around ensuring your policies and procedures are up to date to mitigate the consequences of a discrimination claim. To add to this, companies should also be thinking about putting measures in place to prevent issues arising with employee absence. For example, with just a year to go until when the London 2012 Olympics start, a recent online survey suggests one in six workers would think about taking a sick day in order to watch the Olympics. With the weather turning already, it is also worth considering updating policies such as Adverse Weather and Travel Disruption. As always, please contact me if you would like any advice on policies or you would like me to draft you a policy.