Employment Law Cases

Essop v Home Office; Naeem v Secretary of State for Justice

This latest decision from the Supreme Court clarifies the precise legal test to be used and particularly whether a claimant needs to establish the reason why the treatment they received discriminated against them.

The concept of indirect discrimination has been around for over 40 years yet it is still spawning case law. To summarise - indirect discrimination involves the application of an apparently neutral rule and the disparate impact this has on a person because of their sex or race or other protected characteristic, i.e. it occurs where an employer treats everyone the same but this disadvantages a particular group. An employee must prove that the employer has applied the provision, criterion or practice (PCP) which puts them (and others who share the protected characteristic) at a disadvantage in comparison with others who do not share that protected characteristic. Unlike direct discrimination, indirect discrimination can be justified by an employer.

In many instances, it’ll be obvious why one group is disadvantaged. But what happens when there’s no obvious explanation why an employer’s PCP disadvantages a particular group? This is what concerned the Supreme Court in these two joined cases.

Background

The issue in the Essop case was the test used for promotion in the Home Office, known as the Core Skills Assessment (CSA). All candidates had to sit the same CSA test. A Home Office report showed that the pass rate for both Black and Minority Ethnic (BME) candidates and for candidates aged 35+ was much lower than the pass rate for white candidates and for younger candidates. No reason was identified to explain this differential impact. The tribunal decided that the claimants had to show that the reason for the disparate impact of the testing process was something peculiar to the relevant protected characteristics of race and/or age, which was upheld by the Court of Appeal. To make a claim for indirect race and age discrimination, was it necessary for Mr Essop to prove the reason for the lower pass rate? Or was the simple fact of the lower pass rate enough?

The issue in the Naeem case concerned pay scales for chaplains in the Prison Service. The employee was an imam working as a prison chaplain who had entered the Prison Service pay scale at the lowest point. Until 2002, the Prison Service only employed Christian chaplains; other chaplains were engaged on a sessional basis. Given that the pay system placed emphasis on length of service, Christian chaplains were more likely than Muslim chaplains to be towards the top of the pay scale. Mr Naeem brought an indirect religious discrimination claim, arguing that he had been disadvantaged as a Muslim chaplain by the application of the length-of-service criterion, which meant that the average basic pay of Muslim chaplains was lower than that of Christian chaplains. He complained that a pay scale that was based on length of service indirectly discriminated against Muslims. He also claimed indirect race discrimination, on the basis that more white than Asian chaplains were towards the top of the scale. The Court of Appeal held that there was no indirect discrimination because the reason for the difference in average pay (i.e. length of service) was nothing to do with religion.

Supreme Court decision

The Supreme Court held that an employee doesn’t have to explain why a PCP disadvantages a particular group in order to show indirect discrimination.

In Mr Essop’s case, this meant that it didn’t matter why BME and older candidates were disadvantaged by the CSA test by having a lower pass rate – the fact of the disadvantage was enough to show indirect discrimination. In Mr Naeem’s case, this meant that there was no need to show a direct link between being a Muslim and the reason why the length of service pay scale put Muslims at a disadvantage.

The Supreme Court went on to make some more observations about the test for indirect discrimination claims:

• There is no express requirement in the Equality Act 2010 that a claimant show why a PCP puts one group sharing a particular protected characteristic at a particular disadvantage when compared with others.
• Unlike direct discrimination, indirect discrimination does not expressly require a causal link between the less favourable treatment and the protected characteristic. Instead it requires a causal link between the PCP and the particular disadvantage suffered by the group and the individual. The reason for this is that, in dealing with hidden barriers which are not easy to anticipate or to spot, indirect discrimination aims to achieve a level playing field, where people sharing a particular protected characteristic are not subjected to requirements which many of them cannot meet but which cannot be shown to be justified.
• The reasons why one group may find it harder to comply with the PCP than others are many and various. Both the PCP and the reason for the disadvantage are ‘but for’ causes of the disadvantage, in the sense that removing either would solve the problem.
• There is no requirement for a PCP to put every member of the group at a disadvantage. For example, some women may be tall enough to meet an employer’s height requirement, but it will still be indirect discrimination if more women than men are disadvantaged.
• The pool for considering the impact of the PCP should generally be all workers who are affected by that PCP, whether positively or negatively. In Mr Naeem’s case, all chaplains were covered by the incremental pay scale. So, all chaplains should be considered when assessing disadvantage, rather than just those employed from 2002 onwards.
• It is common for the disparate impact, or particular disadvantage, to be established on the basis of statistical evidence, which can show a correlation between a PCP and a detriment, but correlation is not the same as a causal link.

It is always open to an employer to show that their PCP is justified – there will be no finding of unlawful discrimination unless the justification is not made out.

Link to judgment: http://www.bailii.org/uk/cases/UKSC/2017/27.html

Comment

Proving indirect discrimination has always been difficult for claimants but this decision might make it a little easier. However, the employer always has the defence of justification and this case made some interesting observations about justification.