An employee was sent home from work when allegations were made that he smelt of alcohol. When he next attended for work he complained that his manager had used racially abusive language towards him. He repeated those complaints in subsequent disciplinary proceedings relating to his sending home but was told that they would not be investigated unless he raised a formal grievance, which he did not do. The disciplinary allegation against him was dismissed but the complaints against the manager were not investigated.

The employee then claimed race discrimination and harassment relying on the allegations he had made against his manager. The tribunal found that the events complained about had never taken place and that the employee had invented them. However, the employer's failure to investigate the complaint of racial abuse – even though the allegation was false – was race discrimination.

The EAT overturned the decision. It pointed out that race discrimination involves two elements – the employer must have 1) discriminated against an employee 2) by subjecting him to a detriment. In this case the tribunal had failed to identify what detriment the employee was said to have suffered when the employer failed to investigate his (false) complaint. As the allegations were fabricated, no detriment could be caused by the failure to investigate. The claimant could not have suffered any sense of grievance or injustice because of a failure to investigate false allegations. In the absence of a detriment, the finding of race discrimination could not stand.

However, the EAT recognised that a different approach would apply to complaints that were genuinely believed, even though they were not substantiated. In such a case the employee could have a legitimate sense of grievance if the complaints were not investigated.