In this update we review recent EAT decisions of the relevance of the employer's reasons for discriminating against an employee and liability for discrimination against contract workers.

Employer's motive irrelevant

The EAT has confirmed, in the case of Amnesty International v Ahmed, that an employer which treats an employee less favourably because of their ethnicity cannot escape liability for direct race discrimination because it has benign and potentially justifiable reasons for the treatment.

Miss Ahmed is of northern Sudanese origin and worked for Amnesty International (AI) as a campaigner for the Sudan. Her application for promotion to the position of researcher for the Sudan was turned down because AI considered that her ethnic origin could compromise its perceived impartiality and also put both her and any colleagues travelling with her at increased risk when visiting the Sudan or the camps in Eastern Chad.

The EAT upheld the tribunal's decision that, in cases such as this, where the reason for Miss Ahmed's treatment was so clearly her race, the employer's motive was irrelevant. However, it went on the overturn the tribunal's finding of constructive dismissal. The reasons for AI's decision were serious and genuine and had been arrived at after a careful and thorough thought process. AI had also made it clear to Miss Ahmed that the decision did not reflect on her personally and encouraged her to apply for similar posts. In the circumstances, although they had been guilty of direct race discrimination, AI had not acted without reasonable and proper cause in deciding not to promote Miss Ahmed.

Impact on employers

  • The EAT has confirmed that the correct approach in cases of direct discrimination is to ask the reason why the treatment occurred; motive is irrelevant. Just because an employer has good intentions does not mean the reason for the treatment is not the claimant's race.
  • The EAT recognised that this could put employers in a difficult position where, as here, an employee's national origins could make it difficult for them to work effectively in particular countries.
  • An employer that has discriminated against an employee will usually be in breach of the implied term of trust and confidence. The employer's motive is, however, relevant to and can be taken into account in determining whether its actions amount to constructive dismissal. Circumstances such as those found in this case where the employer's direct discrimination did not also amount to constructive dismissal are likely to be rare.

Liability for discrimination against contract workers

The EAT has held that a council could be liable for the acts of one of its employees who it was alleged had discriminated against an employee of one of the council's service providers (Leeds City Council v Woodhouse and others).

This case illustrates the wide applicability of the Race Relations Act. The Act provides specific protection for contract workers who are supplied by their employer to carry out work for a third party. Mr Chapman provided housing management services to Leeds City Council under a contract between the Council and his employer, West North West Homes Leeds Limited (WNW). He alleged that, in the course of his work, a Council employee had made racially derogatory remarks about him and issued claims against WNW, the Council and the employee in question. The EAT upheld the Tribunal's decision that Mr Woodhouse was a contract worker and entitled to the protection of the Act. Because the Council was the ultimate beneficiary of the work carried out by Mr Chapman, it was therefore potentially liable for the alleged discriminatory behaviour of its employee.

Impact on employers

  • End users of services, for example in out-sourcing agreements and contracts involving agency workers, should be aware that they can be responsible for discrimination against workers who work for them, but are not their employees.
  • This is important because the contract worker's employer will not usually be liable for the discriminatory acts of a third party, for example a customer or supplier. The exception to this rule is in relation to sexual harassment (where an employer is only liable for the third act of harassment to which an employee has been subjected by a third party in the course of their employment).
  • To defend a claim based on the actions of its employees, an employer needs to show that it took such steps as were reasonably practicable to prevent employees committing a particular discriminatory act or committing such acts in general. Employers can go some way towards this by ensuring that their equal opportunities, bullying and harassment policies make it clear that they extend to all individuals with whom their employees come into contact in the course of their employment, not just fellow employees.
  • However, to be successful with a "reasonable steps" defence, a policy alone is not sufficient. Employers should ensure that employees are aware of the policy and its implications, that they have provided training on equal opportunities and harassment to employees, managers and supervisors and that complaints are properly and effectively dealt with and backed up by disciplinary action where appropriate.