Take action to prevent staff sex bias liability

Employers need to tighten policies and review complaint procedures to avoid liability for staff discriminatory acts

Most employers are aware of the problems when a member of staff is accused of sex discrimination. Apart from the effect of poor morale, if it results in a tribunal claim there is the possibility of unlimited compensation for the employee who successfully claims for discrimination.

An employer is liable for the discriminatory acts of its staff where those employees are “acting within the course of their employment”, the scope of which has been gradually widened by the tribunals.

It is important, therefore, for employers to focus on the defence available to them to escape liability. If the employer can show it “took such steps that were reasonably practical to prevent the employee doing the [discriminatory] act, or from doing in the course of his employment acts of that description” the employer will be able to avoid liability (s41(3)) Sex Discrimination Act). The EAT recently looked at that defence in the case of Canniffe v East Riding of Yorkshire Council.

Canniffe had been sexually assaulted by a colleague but the tribunal held that her employer had satisfied s41(3). It found the employer had policies in place which had been drawn to the attention of employees and that, in addition, it could not see anything the employer could have done to prevent the assault. Canniffe appealed saying the tribunal had, in effect, applied a “no difference” test – the worse the level of discrimination, the easier it is for an employer to say there was nothing it could have done to have stopped it.

The EAT agreed. It held the correct test was a two-stage test:

1) Identify whether the employer took any steps to prevent the employee from doing the reported acts; and

2) Having identified those steps, if any, consider whether there were any further steps the employer could have taken that were reasonably practicable.

In the Canniffe case, for example, Canniffe had told her supervisor about the assault, so the EAT thought it would have been appropriate for the council to consider what more could have been done to prevent the assaults.

This case widens the scope of employer’s liability for employee acts. If another employee is aware of discrimination taking place and does not report it, the employer may be liable. Employers should, therefore, consider actively encouraging staff to report discrimination so as to increase their prospects of being able to rely on s41(3).

In another case, Home Office v Coyne, the Court of Appeal looked at how an employer should deal with a complaint of harassment in order to avoid a finding of discrimination.

Coyne had complained she had been sexually harassed by a colleague, but her complaints had been ignored by her employer and she bought a claim for sex discrimination. The EAT held that employers often believe sexual harassment to be the fault of the female victim and that this was the reason for the Home Office’s inadequate investigation.

The Home Office successfully appealed to the Court of Appeal. The court disagreed with the EAT, saying there was no evidence to suggest the Home Office’s inadequate handling of Coyne’s complaint related to her sex.

However, it is possible for an employer’s failure to deal properly with a complaint of harassment to amount to an act of sex (or race) discrimination if a tribunal were to find the reason for the inadequacies related to sex (or race).

By Sarah Lamont, a partner at Bevan Ashford