Earlier this year the Government said it was considering scrapping what it describes as the ‘unworkable requirement’ that employers take reasonable steps to prevent their employees suffering harassment related to characteristics such as race, sex, age, religion and sexual orientation by people from outside their organisation. This requirement stems from the Equality Act 2010, which makes employers responsible for such ‘third-party’ harassment in some circumstances.

Trying to unravel the Equality Act in this way would be no easy achievement, not least because the Government would need the support of Parliament. It is unlikely that the Liberal Democrat side of the coalition will be keen on weakening the Act’s protection.

Even if there were the political support for changing the Act, there is an argument that UK law would not then comply with EU law. In 2008 the previous government was forced to change the Sex Discrimination Act 1975 to enable claims against employers for third party harassment after a High Court Judge ruled that this was needed to comply with the European Equal Treatment Directive on which that Act was based. The parties in that case had agreed that the effect of the relevant Directive was that an employer could be held liable for the conduct of, for example, a supplier or customer, in some cases, such as where there is a continuing course of offensive conduct related to sex, which the employer knows of but does nothing to safeguard against.

In a recent judgment (Sheffield City Council v Norouzi) the President of the Employment Appeal Tribunal (EAT) accepted that it could be argued that the European Race Directive also makes employers responsible for racial harassment by third parties in such cases (although the EAT did not actually make a ruling on the point since the employer appeared to have conceded, in the tribunal, that this was how the Directive should be interpreted). The same could equally be said of harassment related to other protected characteristics.

In light of these obstacles, any change to the Equality Act is certainly not imminent. So, for now at least, all employers can still be held liable for third party harassment related to protected characteristics provided certain conditions are met.

Defending claims – reasonable steps

An employer will have a defence against such a claim if it can show that it has taken reasonable steps to prevent the third party from harassing the employee. To date, there have been no appeal level cases offering any guidance on what would be expected of employers. However, the Norouzi case mentioned above does give an idea of how a tribunal might approach the issue.

Background to the case

Mr Norouzi was from Iran and was employed as a residential social worker at a small care home for troubled children. One of the children was often racially abusive towards Mr Norouzi and, some two years after starting to work at the home, he went on long-term sick leave claiming that this was as a result of the actions of the girl. He brought racial harassment and indirect race discrimination claims against his employer, Sheffield City Council, stating that the Council had not done enough to protect him from the effects of the girl’s behaviour. Although the law that was in place at the time, the Race Relations Act 1976, did not expressly cover third party harassment, Mr Norouzi was able to rely directly on the EC Race Directive because his employer, being a local authority, was an ‘emanation of the State’ and therefore bound by the Directive.

The EAT’s ruling

Mr Norouzi’s claim was successful and the Council’s appeal to the EAT failed. In upholding the tribunal’s decision the EAT made some interesting observations as to what can be expected of employers.

Most importantly, the EAT recognised that there are environments where employees may be subjected to a level of harassment which is a hazard of the job and cannot be easily prevented or eradicated. In such cases, the EAT said, employers should not too readily be held liable for conduct by third parties. The EAT gave as examples care homes, schools and prisons. What such environments have in common is that employees are involved in providing a public service in circumstances where it is not possible (or not straightforward) to deal with an abusive service-user simply by denying them access to the service.

The appeal tribunal said that, before finding such an employer liable on the basis that insufficient steps were taken to protect the employee, a tribunal must focus on what precisely could have been done but was not done.

The EAT was satisfied that the tribunal had approached the matter correctly in this case. On the facts of the case the tribunal found that the Council should have, amongst other things, had a policy or procedure in place covering such situations; discussed the specific incidents with the claimant after they occurred, giving appropriate support and guidance about how he could have handled them better; and worked with the girl, in various ways, to get her to modify her behaviour.

Finally, the EAT ruled that the fact that the claimant himself had not initially ‘pushed’ for anything to be done about the girl’s behaviour did not mean the Council’s inaction could be excused once the problems with the child’s behaviour had been sufficiently clearly drawn to its attention by other routes. This last point shows that a ‘head in sand’ approach to third-party harassment will leave employers exposed.

Sheffield City Council v Norouzi, EAT, 14 June 2001.