Discrimination in the City

Russell
Brimelow, employment and incentives partner at Lewis Silkin law firm, explains
how and why so many high value sex discrimination claims are being brought, and
what this means for the future.

A
barrage of newspaper headlines, all variations on the theme of sex
discrimination and City firms, has hit us in recent months. The most extensive
claims have run into several millions of pounds.

Predictably,
there has been a backlash from various quarters, including the widely reported
comment of Godfrey Bloom, of the UK Independence Party, that: “No small
businessman with a brain in the right place would hire a lady of childbearing
age”. Perhaps more forcefully, leading businesswomen have been reported
recently in The Times as calling for a cap on sex discrimination awards, with
Ruth Lea calling the high awards “completely ridiculous”. So what does the
future hold?

New
factors

A
number of factors have come together in making high value claims of this sort
now commonplace. The legislation has evolved in recent years to put the burden
of proof in such cases upon employers once a potential case has been outlined.
The concept of harassment has been widened; new areas of discrimination have
been added (sexual orientation, religion and belief) and will be added (age discrimination
will be another huge source of discrimination claims from 2006). In addition,
bullying and stress claims are becoming more common – both issues on which a
sex discrimination claim could be based.

New
attitudes

New
attitudes have arisen partly in response to these legal changes, and probably
also due to the high publicity given to favourable employee decisions, which
have emphasised the fact that such claims are uncapped in terms of compensation
and quite possible to win (or settle advantageously).

The
City

In
the City, this creates a potent mix. The City has long been notorious for its
closed, discretionary style of remuneration. In many areas there is still a
clubby, insider culture too. Combine that with workplaces driven by ferocious
internal and external competition, and it is not surprising that women being
paid less or treated worse than their male peers are willing to challenge their
employers legally. City workers tend to be highly paid, confident, and aware of
their legal rights. Their high packages tend to lead to high awards not seen in
lower-paid sectors.

How
can firms avoid these types of claims?

Firms
that adopt best practice in performance management and embrace progressive
employment policies are likely to see favourable results in terms of reduced
tribunal claims.

There
is also a lot that firms can do in a practical sense in order to avoid claims
arising or becoming difficult to defend: key decisions on remuneration and
promotion should be double-checked and properly recorded; bullying should be
the subject of zero tolerance; and sexual banter by e-mail or in the office
should be severely discouraged.

Opening
up the secretive pay culture would also assist – it is noticeable that
tribunals are becoming more aggressive in ensuring that equality is a reality
for City workers.

In
the end, the current trend will leave a mixed legacy – greater openness and
meritocracy, but perhaps in some minds, a lingering sense of injustice at some
of the publicised awards that could hinder women in the long run.

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