The European Court of Justice (ECJ) has recently handed down a judgment that may have significant repercussions.

Its ruling in the joint cases of IX v. WABE eV and MH Müller Handels GmbH v. MJ, both from Germany, considered whether a dress code prohibiting workers from wearing any visible signs of political, philosophical or religious belief in the workplace was discriminatory. The ECJ found that such a policy would not constitute direct discrimination, and whilst it could amount to indirect discrimination, an employer may be able to justify the policy, provided that there is a genuine business need for it.

Background

IX v. WABE eV

This case involved a childcare facility. The Respondent, who owned and ran a number of these facilities, had put in place a policy requiring political, philosophical and religious neutrality in the workplace. This included a prohibition on employees wearing any visible signs of their beliefs when around parents, children and third parties. Further guidance accompanying the policy specified that Christian crosses, Islamic headscarves or Jewish kippahs would not be permitted.

The Claimant in this case, an employee at one of the childcare facilities, wore an Islamic headscarf. When asked to remove it, she refused and was subsequently suspended. During this same period, the Respondent also required an employee to remove a cross that she wore around her neck.

MH Müller Handels GmbH v. MJ

This case dealt with similar facts but the Respondent was a pharmacy. The Respondent had specified that employees were not permitted to wear “conspicuous” or “large size” signs of political, philosophical or religious beliefs.

The Claimant again wore an Islamic headscarf and was asked to remove it. Following her refusal to do so, she was transferred to another post that allowed her to wear the headscarf. However, she was later asked to remove the headscarf again and refused to do so, resulting in her being sent home from work.

The ECJ decision

The two cases were heard together in the ECJ and the referring courts posed similar questions. Firstly, whether the implementation of a universal rule for political, philosophical and religious neutrality could constitute direct discrimination? On this point, the ECJ found that the rule did not target a specific belief, nor did it distinguish between one visible sign and another. Accordingly, such a rule would not amount to direct discrimination. However, the ECJ found that a rule which prohibited conspicuous, large-sized signs of religion or belief may amount to direct discrimination as more visible signs could traditionally be associated with specific beliefs.

The second issue that the ECJ had to consider was whether these policies could amount to indirect discrimination? The ECJ found that such a policy could be indirectly discriminatory, but there is the potential for justification by the employer. To rationalise such a policy, an employer needs to be able to show that there was a genuine need for it. In the first case, IX, the ECJ was satisfied that the legitimate wishes of the parents could be taken into account. Beyond this, the employer must also be able to show that the policy is applied in a consistent manner and is limited to what is strictly necessary, having regard to what the employer is seeking to avoid.

Key takeaway for employers

On the face of it, these cases could give rise to more questions, rather than clarifying the position. At what point will an item be deemed “large” or “conspicuous”? In addition, the cases have given rise to much debate about whether the correct decision was reached – some, such as former Advocate General Sharpston, have argued that both iterations of the neutrality rule should have been found to constitute direct discrimination.

Above all, these cases act as a reminder to employers to ensure that their policies, particularly those which deal with dress code, are considered, well-drafted and applied consistently. If an employer has a genuine need to prohibit visual signs of belief, these cases suggest that a neutral policy can be adopted as long as it is very carefully drafted and implemented in a way that avoids any suggestion that a specific belief is being targeted.