A matter of sex and belief

Draft
regulations on sexual orientation and religion introduces many new areas of
vulnerability for employers. Christopher Mordue offers advice on how to prepare
for them

The DTI’s Consultation Paper, Equality and Diversity: The Way
Ahead, heralds a major overhaul of UK discrimination legislation. Announced on
22 October, the proposals are extremely wide ranging and include significant
changes to existing legislation. However, the headline proposal is the
introduction of three new anti-discrimination laws. Proposed legislation on age
discrimination will not be issued until after a consultation paper next year.
This article examines the potential impact of draft regulations on sexual
orientation and religious discrimination.

Currently, no specific legal protection exists in UK law against
discrimination on the grounds of sexuality or religious belief. Such claims
could be brought as claims of constructive unfair dismissal or forced to fit
within the scope of sex or race discrimination respectively. However, gay and
lesbian applicants have had little success in bringing claims under the Sex
Discrimination Act 1975.

The Court of Appeal has refused to equate harassment on the grounds of
sexual orientation with direct sex discrimination. To succeed in such arguments
applicants have to show that a homosexual employee of a different sex would not
have been subjected to the same treatment. Once such case, Pearce v Governing
Body of Mayfield School, is currently being heard by the House of Lords.
Similarly, in Grant v South West Trains Ltd, the European Court of Justice
declined to decide that an employer’s refusal to extend travel discount to same
sex partners amounted to sex discrimination.

Nor does the Race Relations Act 1976 afford any straightforward protection against
religious discrimination. While some religious groups such as Sikhs and Jews
have successfully argued they are distinct ethnic or racial groups, Muslim
employees have had to challenge dress codes and refusals of leave for religious
holidays using the roundabout route of indirect race discrimination, utilising
the shared beliefs of their racial group as part of the assessment of
disproportionate impact in terms of race.

Same format

One obvious impact of the new regulations is that applicants no longer have
to ‘shoehorn’ their cases into existing legislation.

Given the affinity between claims of sex and race discrimination and those
of sexual orientation and religious belief respectively, employers will welcome
the fact that the proposed regulations adopt the same format and (largely) the
same concepts as existing discrimination legislation.

A key objective of the DTI’s programme of reform is to ensure greater
consistency and coherence across the different strands of discrimination
legislation. Unsurprisingly, the new regulations apply to ‘workers’ (rather
than just ’employees’); they cover recruitment, contractual terms and other
benefits, training, dismissals and other detriment; and prohibit direct and
indirect discrimination, harassment and victimisation. However, there are some
important new concepts and significant departures from the format of previous
anti-discrimination legislation.

"Sexual orientation" means "an orientation towards persons of
the same sex, the opposite sex or persons of the same and opposite sex"
or, in layman’s terms, heterosexuality, homosexuality and bisexuality. As a
result, all workers will potentially be able to make claims under the
regulations – a straight employee could claim harassment by a gay colleague or
boss, and vice versa.

The definition of religious discrimination is more controversial. The
regulations do not exhaustively list the religions or faiths which attract
protection. Instead it is deliberately open-ended – "any religion,
religious belief, or similar philosophical belief". The latter part is
wide ranging and would include atheism, agnosticism and humanism.

One important aspect of the regulations is that they cover discrimination
based on a perception (accurate or not) of an individual’s sexuality or religious
belief. An employee taunted by their colleagues because of a suspicion they
were homosexual would be able to bring a complaint.

In the case of indirect discrimination, the new regulations adopt the
revised form of indirect discrimination recently introduced into the SSA.

This test differs significantly from the traditional approach. It is no
longer necessary to show discrimination arises from the application of a
requirement or condition, which case law had interpreted to mean an absolute
bar. It will be sufficient to show a discriminatory "practice, provision
or criteria" – a much looser test.

Further, applicants will no longer have to show that a substantially smaller
proportion of their particular group can comply with the requirement – an element
which in practice required the production of detailed, often complex,
statistical evidence of the number of people of different groups who could and
could not comply with the discriminatory rule.

Substantial disadvantage

Applicants must now show "a substantial disadvantage" compared
with the comparator group. While statistical evidence may remain important in
some cases, tribunals may interpret such statistics less stringently and may
accept other forms of social and economic expert evidence.

Finally, the test of justification is much more stringent – the employer
must show that the discriminatory measure is a "proportionate means of
achieving a legitimate aim", rather than being able to show that the
discrimination is justified on objective grounds.

This indirect discrimination test will also be adopted for race
discrimination. The overall effect is that indirect discrimination claims may
become much more effective as a means of promoting equality and social change
than before.

A further key feature of the new rights is the introduction of specific
protection against acts taking place after termination. Typically, cases to
date have concerned victimisation and references – for example, the employer
giving a bad reference, or sometimes no reference at all, for an employee who
has previously complained of discrimination.

While European case law has extended sex discrimination protection to cover
post-termination victimisation, such claims have been consistently rejected in
the context of race and disability discrimination, although the House of Lords
will shortly consider the issue in De Souza v Lambeth Borough Council.

The draft regulations prohibit discrimination after the working relationship
has ended as long as the alleged discriminatory act would have been unlawful if
it had taken place during the working relationship and "arises out of, and
is closely connected to, the relevant relationship". While this clearly
covers references, it may also cover situations such as a job application from
a former employee. The DTI Consultation Paper, however, suggests that a
situation where one worker harassed a former colleague in a purely social
context would not be covered.

These new rights clearly create fresh areas of vulnerability for employers.
One key risk is that of harassment, either by a line manager or, perhaps, more
commonly, by a colleague. Sex and race harassment claims are already
significant problem areas for employers and no crystal ball is necessary to see
that sexual orientation and religious belief may also prove to be fertile areas
for complaint. Harassment often takes the form of banter, abuse, ridicule or
adverse comments about anything which makes one worker different from the norm.

Workplace banter

In this context, harassment on the grounds of sexual orientation (or
perceived sexual orientation) may present the greatest risk – given that
homophobia is still a major issue in society at large. It is also predictable
that many complaints will arise from unwanted speculation or comments about a
colleague’s private life and, as with sex discrimination, workplace banter may
easily cross the line into harassment.

Unlike existing discrimination legislation, the regulations create a
specific offence of unlawful harassment. The definition is essentially
consistent with existing case law, in that the harassment has to be
"unwanted conduct" which has "the purpose or effect of either
violating the applicant’s dignity or creating an intimidating, hostile,
degrading, humiliating or offensive environment".

While the existence of harassment is judged on all the facts of the case,
this includes the victim’s reasonable perception of the effect of the
treatment.

One of the principal difficulties in defending harassment claims is that the
employer is vicariously liable for one worker’s acts against another. While
employers must be careful to ensure their response to harassment complaints is
not in itself discriminatory – by responding promptly, thoroughly, reasonably
and not penalising employees for raising complaints – they often find
themselves in the unfortunate position where if an act of harassment has
occurred, they will be liable for it regardless of how well they respond. To
avoid such liability, employers must take all reasonably practicable steps to
prevent the unlawful act occurring – tribunals have often shown themselves
reluctant to let employers off the hook, however.

Nevertheless, there are a number of practical steps employers can take to
put themselves in the best position to defend claims (see Action Points, top
right). These involve ensuring that equal opportunities policies and statements
(many of which already cover sexuality and religion) are not mere ‘paper’
documents, but are given real meaning and effect in the workplace.

Recruitment and promotions exercises are also a key area of risk,
particularly where religious belief makes it difficult for job applicants to
comply with traditional working hours or with dress codes.

Conflicting rights

Contracts of employment should also be considered for their potential
discriminatory effects, such as rules that prevent workers taking holidays for
religious festivals or the denial of benefits to same sex partners (although
pension benefits are expressly not covered by the new rules). Where such disparity
exists, employers must carefully consider whether the more stringent test for
justification could be met.

Workforce monitoring is an important part of ensuring compliance with
equality legislation. While a person’s sex and (to a lesser extent) race may be
relatively obvious, sexuality or religious belief cannot be so readily
identified.

Employees cannot be forced to provide this information and indeed may be
very reluctant to do so. Even if it is obtained, such information constitutes
sensitive personal data under the Data Protection Act 1998 and employers must
therefore be careful to obtain the worker’s informed consent to this use.

An additional problem is that the new regulations could introduce
conflicting rights. One worker’s homosexuality may offend the religious beliefs
of a colleague, for instance. This dispute may lead to mutual harassment with
the unfortunate employer facing two or more harassment complaints at the same
time. The regulations and indeed the Government’s consultation documents
provide no solution to this problem.

As ever in the field of discrimination, employers are placed in the
frontline of the battle to change social attitudes and face the dual burden of
both promoting equality and meeting the liabilities and costs of new employment
rights. Employers should act now to keep ahead of these major developments.

Christopher Mordue is an associate at Pinsent Curtis Bidwell

Key concepts of discrimination

– Direct discrimination Treating employee less favourably than another on
grounds of sexual orientation or religious belief. Applicant must show
comparator (actual or hypothetical) whose circumstances are the same or not
materially different. No justification defence is available

– Indirect discrimination The
application of a provision, practice or criteria which applies or would apply
equally to persons of a different religious belief or sexual orientation but
which puts or would put persons of the same religion/belief or sexual
orientation at a particular disadvantage when compared with others puts the
applicant at that disadvantage and which the employer cannot show to be a
proportionate means of achieving a legitimate aim

– Harassment on grounds of
sexuality/belief, X engages in unwanted conduct which has the purpose or effect
of either violating Y’s dignity or creating an intimidating hostile degrading
humiliating or offensive environment for Y. Whether this effect is present is
to be determined by having regard to all the circumstances including the
reasonable perception of Y

– Post-termination discrimination It is unlawful to
discriminate against former employee by subjecting them to detriment or to
harassment where the discrimination or harassment arises out of and is closely
connected to the former work relationship

– Victimisation Treating the employee
less favourably than the employer would treat another in the same circumstances
because the employee has brought proceedings under the regulations, alleged a
breach of the regulations, given evidence for another employee, and so forth

Action points

– Ensure policies and statements go
beyond mere paper commitments

– Review equal opportunities policies and statements,
harassment procedures and training materials to ensure new forms of
discrimination are covered

– Train line managers on the new rules and how to spot and deal
with harassment

– Train/brief all employees (including new recruits) on the
importance of non-discriminatory behaviour, disciplinary consequences of
harassment and the procedures for raising complaints

– Appoint harassment counsellors to act as informal sources of
advice for employees

– Deal firmly and proportionately with harassers, under
disciplinary procedures if appropriate

– Review terms and conditions and working practices for
potentially discriminatory issues

– Look at ways of celebrating and promoting workplace diversity

– Review selection criteria and procedures for recruitment and
promotions. Ensure the criteria used reflect the needs of the job. Train
interviewers on diversity and discrimination issues and ensure they keep a full
written record of reasons for decisions

– Use the time before the new laws take effect to
conduct questionnaires and informal soundings to identify potential areas of
disputes or harassment. This allows issues to be tackled before employees gain
their new rights

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