The latest employment law decision from the UK’s top court has done much to clarify how the law on indirect discrimination should be applied in practice. It removes the confusion caused by a disagreement between the Court of the Appeal and the Employment Appeal Tribunal about the correct approach to assessing the impact of apparently neutral but potentially discriminatory requirements. To that extent it will be welcomed be everyone involved in employment tribunal litigation. However employers in particular should be aware that this clarification of the law will make it more likely that indirect discrimination claims will continue to the justification stage, rather than being dismissed at an earlier stage in the proceedings.
Indirect discrimination defined
First, a quick reminder of the familiar legal definition of indirect discrimination. For most purposes the four key legal ingredients can be summarised as follows:
- There must be a “provision, criterion or practice” (PCP) which is “apparently neutral” (ie applied equally to members of the relevant protected group and to others);
- The PCP must put members of the protected group at a “particular disadvantage”
- The PCP must also put the claimant at that disadvantage;
- The employer must be unable to justify the PCP – ie to show that it is a “proportionate means of achieving a legitimate aim”.
The six salient features
Lady Hale, giving the only judgment, has identified six “salient” features of indirect discrimination:
- No “reason why” requirement: Unlike with direct discrimination, there is no requirement to identify why a PCP puts a protected group at a particular disadvantage when compared with others. It is enough that it does. Sometimes the reason for this will not be obvious.
- Levelling the playing field: The law against indirect discrimination is not directed at equality of treatment but equality of results. In contrast to direct discrimination, it addresses “hidden barriers that are not easy to anticipate or spot”.
- “Context factors”: There can be many reasons why a protected group may find it harder to comply with a PCP than others. These can be social or genetic or a combination of the two. They could also be due to another PCP, which works in conjunction with the PCP in question. The reason for the disadvantage need not be unlawful in itself, or under the control of the employer.
- Not an “absolute bar”: There is no requirement that the PCP puts every member of the protected group at a disadvantage: if it did it would be closer to a case of direct discrimination. It is sufficient if the proportion of the protected group who can comply is “considerably smaller” than the proportion of other people affected.
- Relevance of statistical evidence: It is commonplace for the disparate impact, or particular disadvantage, to be shown by statistical evidence.
- Justification: It is always possible for the respondent to a claim to show that the PCP is justified. There can be no finding of unlawful discrimination until all four ingredients of the definition are satisfied.
In both cases under appeal, the upshot was that the employers will have to justify the relevant PCP, to the extent that they have not already done so.
In the first appeal the case will return to the employment tribunal. The Home Office, as employer, will now be called on to justify the requirement that candidates for promotion must pass an exam. This was shown by statistical evidence to put black candidates at a particular disadvantage, even though the reason behind the disadvantage could not be established.
In the second appeal, the Supreme Court has restored the decision of the employment tribunal. The tribunal had decided that applying the same service-related pay scale to Muslim as well as Christian prison chaplains was a PCP which put Muslim chaplains at a particular disadvantage. However the employer had been able to demonstrate to the tribunal’s satisfaction that continuing to use the pay scale for a transitional period had been justified.
The broader lesson to be drawn from this this case is that it reinforces the importance of employers monitoring the impact of its PCPs. As Lady Hale puts it:
“a wise employer will monitor how his policies and practices impact upon various groups and, if he finds that they do have a disparate impact, will try and see what can be modified to remove that impact while achieving the desired result.”