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What do you need to know about discrimination law?

With potentially unlimited liability, discrimination law is one area you need to be careful around as a business owner – find out how to navigate the law

As a business owner, if you could choose one legal pitfall to avoid, it should be discrimination. Unlike unfair dismissal and other employment-related awards, losing a discrimination claim in a tribunal will lead to potentially unlimited damages – so it is essential to get the law right.

Unfortunately, keeping in line with the law isn’t quite as simple as just avoiding overt discrimination, such as being racist or sexist against an employee. You can be unintentionally discriminatory too, so you need to know how this can occur and how to avoid it.

This article provides the basics of what you need to know to stay in line with the law, covering:

  • What is discrimination?
  • What are protected characteristics?
  • How to avoid unintentional discrimination
  • What to do if someone brings a claim against you

What is discrimination?

Essentially, the law considers discrimination to occur when you treat someone less favourably because of a protected characteristic they have.

A protected characteristic is one of the following:

  • Age: A recent change in the law means there is no longer a ‘default retirement age’, so you can’t let someone go because they are too old anymore. If you wish to let an older employee go, you have to go through the standard dismissal process.
  • Sex: This refers to discrimination based upon someone’s gender.
  • Gender reassignment: This refers to discrimination against someone based upon their gender reassignment.
  • Marital status: Covering marriage and same-sex couples in civil partnerships or marriage.
  • Pregnancy and maternity: Perhaps the most legally problematic characteristic for many employers, you are forbidden from dismissing someone because they have gone on maternity leave – even multiple times. This covers paternity leave as well.
  • Race: Covering colour, nationality, national or ethnic origins.
  • Sexual orientation: Fairly self-explanatory; you cannot discriminate against someone because of who they are attracted to.
  • Religion or belief: This includes lack of any belief, and political beliefs. Interestingly, there is an exception to this covering allegiance to football teams.
  • Disability: This is defined as a physical or mental impairment which has a substantial and long-term effect on an employee’s ability to carry out day-to-day activities, so it can cover certain diseases and conditions as well. Disability law also imposes a positive requirement on employers to consider whether they can make any ‘reasonable adjustments’ to accommodate disabilities in the workplace such as ramps for wheelchair users.

It’s also illegal to discriminate against someone based upon membership of a trade union. This covers non-membership as well.

It is important to note that the Equality Act 2010 (which governs the majority of discrimination law) also outlaws ‘positive discrimination’ in which members of a disadvantaged group are treated more favourably.

The only exception to this is known as a ‘tie-break’ scenario when recruiting – if you have two employees with absolutely equal qualifications and competence for the job, you are allowed to select a candidate on the basis that their protected characteristic is under-represented in the workplace. Tread carefully here though. It will be rare that you have two equally qualified candidates for anything, and you are exposing yourself to risk of a claim.

What is a protected act?
If someone brings a discrimination claim against you, or has indicated they might, this is known as a ‘protected act’, and it is also illegal to discriminate against them on this basis.

What are the types of discrimination in the workplace?

The law considers it irrelevant whether or not you have malicious intent when discriminating against someone – it is the effect of the treatment on the other person that matters. This means you can discriminate against someone without realising it.

Broadly, there are five kinds of discrimination outlawed in the workplace:

Direct discriminationThis is where you treat someone less favourably directly because of a protected characteristic they have. Direct discrimination can occur in situations where you treat someone less favourably because of the effect of their protected characteristic – for example, sacking a pregnant employee because she is off work and costing you money, or a disabled employee for needing expensive special equipment in the workplace. If an employee produces evidence that you discriminated against them, the burden of proof shifts to you to disprove it.
Discrimination by perception or associationIt is also illegal to discriminate against someone if you think they have a protected characteristic but in fact they don’t, or they associate themselves with a protected group. An example would be sacking someone because you think they are gay, or they are an advocate for gay rights.
HarassmentThis can be applied to all protected characteristics except for pregnancy and maternity and marriage and civil partnership. This applies for both direct cases of harassment, as well as other employees who find certain actions or environments intimidating or offensive. Also, employers may be liable for third party harassment; the actions of people who aren’t employees.
Discrimination by perception or associationIt is also illegal to discriminate against someone if you think they have a protected characteristic but in fact they don’t, or they associate themselves with a protected group. An example would be sacking someone because you think they are gay, or they are an advocate for gay rights.
VictimisationThis is where you discriminate against someone for making a ‘protected act’ to do with making a claim against you under the Equality Act.

How do I ensure I treat people equally?

To avoid unintentional discrimination, you need to monitor yours and others’ actions in all aspects of the workplace, but especially in some key danger areas:

  • Recruitment
  • Dismissal
  • Redundancy
  • Promotion and training selection

To avoid discrimination in these areas, consider the following:

  • Create objective criteria for selection: This applies to all the danger areas outlined above. Focus solely on the requirements of the job, and be blind to personal characteristics.
  • Be aware of equal pay audit: This can assess whether any illegal pay gaps exist in your workplace so you can take steps to address them.
  • Make sure all dismissals are conducted legally: Always important but especially so in the context of discrimination law; remember that damages are unlimited in this area.

How do I avoid discrimination in the workplace?

If you are the owner or manager of a company, you are responsible not just for your own actions, but the actions of your employees, and if a member of staff discriminates against someone you are vulnerable to a claim.

To avoid discrimination occurring in the workplace, follow these steps:

  • Establish an anti-discrimination code of practice: Make staff aware of the law and how to avoid breaking it. Display it clearly on staff noticeboards and handbooks and make it clear that breaches will be punished.
  • Train employees: Educate staff in the relevant law – this is especially important for those managing the recruitment and selection process.
  • Set up a complaints system: Create an anonymous reporting system for discriminatory behaviour.
  • Review the policy regularly: Be aware of how well your system is working and keep an eye on changes in the law.

How do I deal with a complaint of discrimination?

When someone makes a complaint of discrimination, it is important to take it seriously from the start, even if you think it is unsubstantiated.

Follow these steps when you face a complaint of discrimination:

  • Take advice: The Equality and Human Rights Commission and Acas, as well as the government advice on the Equality Act, offer advice.
  • Investigate the complaint: Be as thorough and objective as possible, and be prepared to get an independent third-party to help with the process
  • Use your official processes: If you’ve followed the above advice you should have a procedure for dealing with grievances
  • Offer redress: If you find the complaint to be justified, be prepared to offer compensation and change any policies you found to be wanting. If the complaint is not justified, explain why
  • Offer an appeal: Offer the complainant an appeal if you reject their complaint

If they find your response to the complaint wanting, your employees can make a complaint to the employment tribunal. As part of this claim they may send you a questionnaire on discrimination; it is normally a good idea to complete this, unless you find the questions to be unreasonable.

Remember it is normally a good idea to try and settle out-of-court if you can, even if you think you have a strong case. Tribunal claims can take months to complete and could prove an expensive distraction from the day-to-day running of your business. Acas offers a free, independent conciliation service to help you resolve disputes.

Are there any situations where discrimination is allowed?

The law recognises that discrimination is not always clear-cut, and there are some limited situations where discrimination is allowed.

Although positive discrimination is not allowed, you can take some steps to encourage under-represented groups to improve their position in the workforce, such as improving their access to training and experience to build skills.

The other exception to discrimination law is where you discriminate because of a ‘genuine occupational requirement’ for a job. An example would be a religious organisation that requires certain staff to follow the same religion as the organisation.

The requirement must be a ‘proportionate means of achieving a legitimate aim’; in other words, the requirement must be genuine and you must go no further than necessary.