In the case of EAD Solicitors LLP and Ors v Abrams an Employment Tribunal has confirmed that protection against discrimination extends to limited companies as well as individuals. The Tribunal said that: “What is important is to combat discrimination so that there shall be no direct or indirect detrimental treatment of any person on the basis of the protected characteristics of an individual”. In this context, “person” includes limited companies.
The case involved a solicitor, Mr Abrams, who provided services to EAD Solicitors, through a personal services company (GAL) in order to benefit from an advantageous tax scheme. When Mr Abrams reached the age of 62, EAD stopped paying GAL on the basis that its partnership deed provided for the retirement of members at that age. Mr Abrams and GAL sued EAD for age discrimination and the Tribunal had to determine whether GAL, a corporate entity, had the right to pursue a claim under the Equality Act 2010. It held that GAL could pursue its claim for discrimination based upon Mr Abrams’ age as the scope of the protection offered by the Equality Act is not limited to individuals.
This decision has potentially wide-ranging consequences and opens the door to corporate entities challenging decisions which affect them in an employment context or in relation to the provision of goods and services. For example, a company whose bid for a contract is rejected could potentially claim discrimination if the religious belief of its directors affected the decision. Equally, employers who engage contractors through personal services companies may face claims from those companies if the individual providing the services is subjected to discrimination.
This case shows that tribunals are keen to extend protection against discrimination on public policy grounds. It highlights the limits to the protection afforded to employers by requiring that contractors work through a personal services company.