Racism is unhealthy and unproductive   But it persists in the workplace

Past retirement age? You still can't sack people!   

Racism is unhealthy and unproductive

We mentioned this briefly in last month's newsletter. This month we look at racial discrimination in more depth because of its significance to our society and workplaces. It is worth remembering that there is no upper limit for discrimination when it comes to tribunal compensation. It is therefore important that employers understand their responsibilities to avoid costly mistakes. Compensation normally includes an award for injury to feelings and an award to take into account any loss suffered, for example loss of wages or pension.

In a recent case the EAT ruled that a £21,000 compensation award for injury to feelings caused by serious and prolonged racial discrimination was not excessive.

Despite various legislation and the steady increase in the attempt to educate employers and employees over the last decade, racism still exists and many black and ethnic minority workers are still being treated unfairly, according to the report Black voices at work, published by the TUC.

An equal opportunities policy in many organisations is often just words on paper and in reality carries little weight or conviction. So what do you need to know to ensure you meet legislative requirements and what should you be doing to create an organisation that promotes racial harmony and fairness?

Race relations - what you need to know.

At sometime in our lives most of use will feel that we have been discriminated against, whether because it was due to sex, age, race, height or just the way we dress.

However, under the Race Discrimination Act 1976 discrimination in employment on the grounds of race is unlawful. Under section 3 of the Race Relations Act 1976, 'racial' means colour, race, nationality or ethnic or national origins. An ' Ethnic group' is defined as having two characteristics:

• A long shared history
• A cultural tradition of its own, often but not necessarily associated with religious observance.

Who is responsible in the employment environment?

The responsibility usually lies with the employer and/or any other employee, who is found to have discriminated. Employers will be liable for the discriminatory acts of employees where those employees are acting in the course of their employment. This is known as vicarious liability. An employer may also be liable for the acts of a third party such a client, as in the well none Bernard Manning case. The comedian (although that's matter of opinion!) Bernard Manning, a guest speaker at a Round Table dinner, subjected two waitresses to racial abuse during the speech. The Employment Appeal Tribunal (EAT) ruled that the employers of two waitresses were liable for the abuse because they caused or permitted the abuse to occur in circumstances which they could control. 

There are, however, certain situation under the Race Relations Act where race discrimination is allowed in the employment field - this is known as Genuine Occupational Qualification (GOQ). The list of GOQs includes actors, models, personal welfare services and jobs involving work where food or drink is provided for which a person of a racial group is required for authenticity (e.g. a Chinese or Indian restaurant). 

Racial discrimination may arise in three ways:

Direct - A person discriminates against another by treating that other less favourably than another person.

Indirect - Where an employer operates a policy which may appear as though it has nothing to do with race but in practice the effect is to disadvantage ethnic minorities. For instance, where an employer makes it a condition that a turban or a beard may not be worn, without valid justification.

Victimisation - Anyone involved in bringing proceedings, making allegations or giving information in connection with the Race Relations Act is protected by the Act against victimisation. That means that they must not be subject to any detriment as a result.

How can it arise?

In an employment situation race discrimination may occur at various stages and it applies to applicants for jobs, employees, contract and self employed workers:

Recruitment and selection - Unless the employer can prove that the selection was based purely on the suitability of the candidate i.e. they had the necessary skills, knowledge, experience etc a claim for racial discrimination may well win. A firm of solicitors refused to employ a black secretary on the grounds that she lacked experience. The tribunal concluded that this was not the real reason. The effective reason was that she was black and the firm had acted in a racially discriminatory manner.

Terms and conditions of employment - Giving unfavourable terms and conditions, benefits or facilities based on racial discrimination.

Selection for training and promotion - denying or limiting access to training and promotional opportunities.

So what should employers be doing?

• The commitment to be an equal opportunities employer comes from the top. Ensure that all senior managers understand the benefits but also the serious consequences of falling foul of discrimination. Policies against discrimination must be backed and practised by senior management. They must treat racial discrimination, including the expressing of racist views, as a serious disciplinary offence.
• Ensure that all employees and especially managers responsible for recruitment and conduct of employees, are aware of the law and the Company's policies and procedures. Ensuring that all new recruits at induction understand their responsibility under the Company's policy on equal opportunities and harassment and the consequences of failing to comply with them.
• Documentation and procedures, for example to do with recruitment and promotion or training, are well structured and transparent.
• All incidences, no matter how minor, must be reported and logged and brought to the attention of the senior manager responsible for monitoring equal opportunities.
• In an organisation where there is a high number of an ethnic minority group or different groups, a program of cultural awareness may form part of an overall policy of education. This can also be an excellent team building exercise.

Ultimately, racism is unhealthy and unproductive (whether it is outside or inside of employment). At Picasso HR we believe that employers need to actively ensure that they meet legislative requirements and through their working practices, have a significant role in promote racial harmony.

Past retirement age? You still can't sack people!

Just when you thought it was safe to go back in the water, retirement age bites you in the ...

The Government is committed under European law to implement legislation to outlaw discrimination on the grounds of age by 2006. At present, there is no indication of what form this legislation will take or how it will affect our existing approach to retirement ages, unfair dismissal and redundancy. But recent cases should make employers think long and hard about any retirement age and equal opportunities policy and practice that might exist.

Employers should now note that they cannot rely upon either a normal retirement age policy or the fact that an employee who is 65 years of age or older when dismissing, as these employees may now be entitled to claim unfair dismissal and redundancy payments in the usual way.

Rutherford v Harvest Town Circle Ltd and The Secretary of State Trade and Industry

This case centred upon whether an Applicant over 65 years of age could bring claims for unfair dismissal and a redundancy payment notwithstanding the provisions in the Employment Rights Act 1996 ("ERA") which state that employees who have reached the normal retirement age for their particular position (or where there is no normal retirement age, 65 years) have no right to do so.

Mr Rutherford was compulsorily retired at the age of 67, and objected to the rule which prevented him from pursuing a Tribunal claim for unfair dismissal and redundancy by reason of his age. He pursued his case by claiming indirect sex discrimination. His argument was that the cut-off age of 65 disadvantaged more men than women in a way that could not be justified and so breached the Sex Discrimination Act.

Mr Rutherford succeeded before the Employment Tribunal, who relied on statistics which showed that 8% of men over the age of 65 were economically active in the sense of being in work or available for work, compared to 3% or women. The Company was able to produce no evidence to justify the statutory provision.

The Employment Appeals Tribunal (EAT) ordered the Tribunal to reconsider its decision that this limit was indirectly discriminatory against men. The Secretary of State for Trade and Industry was also joined into proceedings to justify this provision of the ERA.

In its very thorough analysis of the issues and statistics, the Tribunal has again held that the provisions of the ERA are indirectly discriminatory and have a disproportionate and adverse impact upon men. Nor could any policy justify their inclusion in the ERA.

There is yet no indication whether this decision will be appealed so watch this space!

Opportunity knocks..... in Taylor v Secretary Of State For Scotland [1999]

Mr Taylor was employed as a Prison Officer by the Scottish Prison Service. When he joined the Service, retirement arrangements permitted him to retire at age fifty-five. By agreement, he could continue to work until age sixty, subject to a right to terminate by giving three months' notice by either side.

In 1991, Mr Taylor reached age fifty-five. His employers agreed that he could continue in his job beyond the age of fifty-five but that retention beyond the minimum retirement age "is at the Department's discretion and subject to regular review. Retirement may therefore be effected at any time and is subject to three months' notice on either side".

In 1992, the employers issued a circular setting out an equal opportunities policy, undertaking "to offer opportunities on an equal basis to all staff regardless of gender, race, religion, sexual preference, disability or age".

In 1994, the Scottish Prison Service introduced changes to its retirement policy. All employees over age fifty-five, including Mr Taylor, were given six months' notice of dismissal. The purpose was to save money and get a younger and differently skilled workforce.

Mr Taylor claimed that this amounted to discrimination on grounds of age, in breach of the equal opportunities provision which he claimed formed part of his contract of employment.

Two issues arose:

(a) whether the management circular of 1992 provided a legally enforceable contractual right not to be discriminated against on grounds of age; and

(b) if so, was a change in the employer's retirement age policy, which led to his dismissal, age discrimination and therefore in breach of contract?

The Employment Tribunal supported Mr Taylor's claim. The equal opportunities policy was "incorporated into the Applicant's contract of employment".

The Tribunal went on to find the policy specifically contained a provision that employees would not be discriminated against because of their age, that the reason for the change in the retirement policy was principally a question of age and therefore contrary to the equal opportunities policy. There had been a breach of contract.

The Employment Appeal Tribunal (Scotland) agreed with the employment Tribunal's finding that the terms of the equal opportunities policy were incorporated into the employee's contract of employment. However, the EAT allowed the employer's appeal on the grounds that the dismissal of Mr Taylor after he reached the normal retirement age of fifty-five was not discrimination on grounds of his age.

On appeal to the Court of Session, it was not disputed that the equal opportunities policy was part of the contract of employment. However, the Court of Session also held that the decision to retire Mr Taylor was not age discrimination in breach of his contract of employment. The Court noted that any retirement policy, if put into operation, would almost inevitably result in the retiring persons being replaced by younger persons.

Mr Taylor had a contractual right not to be discriminated against on grounds of age, before the minimum retirement age of 55. But, the contract gave management a wide discretion to decide on retirement ages between 55 and 60 and could include age considerations.

Whilst it is difficult to accept that the use by an employer of a retirement policy to remove a section of employees for the purpose of introducing a newer and younger workforce does not amount to age discrimination, the case does represent a significant advancement in creating a remedy for those who are discriminated against on the basis of their age. The finding that equal opportunities policies may be incorporated as part of a contract of employment, allows an employee to sue for breach of contract.

This case sends an important message to employers implementing equal opportunities policies that they may be held accountable for the assurances made in those policies, in the event that those assurances are not fulfilled.

The information in this newsletter is of a general nature and is not a substitute for professional advice. You are recommended to obtain specific professional advice before you take any action.

For further information, advice or assistance on any of the matters raised in this newsletter please contact Picasso HR on 01473 890037.

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