Discrimination and equality in the UK

Christopher Hitchins of Morgan Lewis looks at the risks, liability and best practice guidelines concerning discrimination and equality

Introduction

In the UK, there are various strands of discrimination law on discrimination and equality that prohibit discrimination on the following grounds: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, color, nationality and ethnic origin, religion and belief, sex and sexual orientation. The Equality Act, which received Royal Assent on April 8, 2010, unifies the previous strands of discrimination into one piece of legislation, covering the “protected characteristics” – the main provisions of the Equality Act will come into force in October 2010.

In many ways, UK discrimination and equality law contains similar concepts to the discrimination laws in the US. However, there are several UK-specific traps and pitfalls for employers. This article summarizes the current legal position in the UK on discrimination and equality and gives some recommended best-practice guidance to employers establishing UK businesses, to help to prevent claims and avoid legal liability.

What constitutes discrimination in the UK?

The main types of discrimination in the UK are direct discrimination, indirect discrimination, harassment and victimization. Harassment in the UK can potentially also include bullying, and therefore this concept has a wider interpretation in the UK than in the US. An employer will directly discriminate against an individual where it treats an individual less favorably than it would treat another person on the grounds of a protected characteristic (ie, because of a discriminatory reason). For example, choosing to recruit or promote a woman instead of a man purely on the grounds of their sex will be directly discriminatory.

An employer will indirectly discriminate against an individual if it adopts a provision, criterion or practise that applies equally to all employees, but which may place those with a protected characteristic at a particular disadvantage, compared to others without that protected characteristic – ie, adopting an otherwise neutral provision that could have a discriminatory effect. An employer can successfully defend an indirect discrimination claim if it can show that its provision, criterion or practise was a proportionate means of achieving a legitimate aim (this latter test is often referred to as “objective justification”).

For example, introducing a requirement that all employees are to work full-time is likely to have a disproportionate effect on women, since they are (statistically) more likely to carry the burden of childcare responsibilities than men and as a result are more likely to want (or need) to work part-time. If a woman wishes to work part-time, then unless an employer is able to objectively justify that the job must be done on a full-time basis, the requirement will indirectly discriminate against her.

Changes to the Law on discrimination and equality

The Equality Act includes some new concepts that employers setting up or operating businesses in the UK should be aware of: The definition of “direct discrimination” has been widened so that discrimination by association will be unlawful. This could cover situations where an employee feels that he or she has been discriminated against because he or she has a responsibility for somebody who has a protected characteristic (for example, a disabled relative). Discrimination because of a person’s perceived characteristic will also be unlawful (for example, discrimination because of an incorrect perception that somebody is gay will be a potential ground of unlawful discrimination).

Positive Action in discrimination and equality

Employers in the UK may (although they are not required) take underrepresentation of those with a protected characteristic into account when selecting between two equally qualified candidates for recruitment or promotion, provided that there is no automatic selection of underrepresented groups, and decisions are not made irrespective of merit (ie, by the use of mandatory quotas, which is an increasingly common phenomenon in mainland Europe). Regardless of the new provisions, the selection of a lesser-qualified candidate on the grounds that he or she is in a protected category will remain unlawful.

Until there is an established body of case law to provide guidance on this discrimination and equality point, there is likely to be a certain amount of employment litigation in the UK on what constitutes whether candidates are “equally qualified” or not, or how “underrepresented groups” are to be defined. Employers may therefore be fearful of exercising positive action in the event that they are exposed to discrimination and equality claims from unsuccessful candidates. Furthermore, using this selection method for recruitment and promotion may lead to hostility in the workforce against those individuals selected by positive action.

Discrimination and equality secrecy clauses

The Equality Act prohibits and renders unenforceable, terms of employment or appointment that prevent or restrict individuals from disclosing their pay to their colleagues, to the extent that such terms would prevent or restrict such a discussion. In our experience, it is common for employment terms for senior executives in certain industry sectors (for example, the financial services industry) to contain such “secrecy clauses”.

Gender Pay Gap Reporting

The Act also encourages private sector employers with 250 employees or more in the UK to publish information voluntarily on an annual basis about the difference in pay between male and female employees. The UK government has stated that it will likely implement mandatory gender-reporting regulations in 2013, including civil and criminal sanctions for non-compliance.

What are the risks associated with discrimination and equality claims?

If a finding of discrimination is made against an employer, potential employer or future employer, then the compensation that can be awarded is uncapped. Therefore, from a legal liability perspective, employers should treat discrimination and equality allegations seriously. In addition, it is not just corporate entities who can be sued for discrimination – individuals who the claimant feels were the perpetrators of or encouraged the discrimination could also be named on the claim form, and an uncapped financial award could potentially also be made against them.

Therefore, managers must be aware of the discrimination and equality legal landscape and how to handle discrimination allegations to try to avoid becoming named as a party to the litigation. In addition, an Employment Tribunal can make a “declaration” against the employer or any individuals against whom the claim has been made that they have acted in a discriminatory way.

Tips to avoid discrimination claims

In order to minimize the risks of discrimination claims materializing, and to enhance an employer’s prospects of successfully defending such claims, we recommend that employers in the UK:

Implement discrimination and equality workplace policies and procedures and review and revise them if necessary on a regular basis, to ensure equal treatment of employees and that they are protected from discrimination
Consider other workplace policies that may impact on employees who are associated with persons with protected characteristics
Treat discrimination and equality issues with careful attention
Implement manager and all-employee training on discrimination and equality diversity, and anti-harassment, to make sure that all employees and managers are aware of their rights and responsibilities
Implement training sessions on handling and managing grievances at work, as well as handling disciplinary matters
Seek discrimination and equality legal advice where appropriate.

Carefully drafted discrimination and equality policies to which the employer adheres and employee training programmes could be important criteria in a successful defense of a discrimination claim.

For more information on discrimination and equality in the UK, contact:

Christopher Hitchins
Morgan, Lewis & Bockius
Condor House, 5-10 St. Paul’s Churchyard
London EC4M 8AL, United Kingdom
Tel: +44 (0)20 3201 5654
Fax: +44 (0)20 3201 5001
E-mail: chitchins@morganlewis.com
Website: www.morganlewis.com

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