Publications

THE NEW SEX DISCRIMINATION REGIME

It is crucial that businesses and their advisers are aware of the far reaching changes made to the Sex Discrimination Legislation, says David Malamatenios.

In Brief

  • The Sex Discrimination Act failed to implement the EC Equality Directive.
  • This has been addressed by the Sex Discrimination Act (Amendment) Regulations 2008
  •   These important changes will cause problems for businesses if they fail to plan for them.

Important changes to the Sex Discrimination Act came in to force on the 6th April 2008.  These changes are far reaching and could have serious repercussions for employers and their advisers who fail to take proper note of them.  Before outlining the changes, I want to mention what is the most surprising thing of all to arise from them which is the apparent indifference and lack of preparation in the business community to meet the challenges presented by this new legislation.

Outside of the specialist, legal and personnel press, the changes themselves have received very little publicity either before or after their implementation.  This means that many businesses have had little time to prepare or are not even aware of the need to make preparations.  This is concerning considering that the government has estimated that it will cost small firms in the region of £10 million to comply.

For the changes to have come about should come as no surprise to anyone.  They have been on the cards for some time now.  In 2007, the High court found that the UK Sex Discrimination Act failed to adequately implement the EC Equal Treatment Directive 76/207 EC.  This caused Burton J to comment that the Sex Discrimination Act had to be “re-cast”. 

Readers will be aware that the Equal Treatment Directive requires equal treatment in all aspects of employment.  It is no small feat to impose uniformity across Europe’s diverse social, political and legal traditions but the Directive was designed in July 2002 to ensure that this was the case.   It imposed new obligations on member states and introduced standard definitions that would apply across the EC to cover legal concepts such as “indirect discrimination” and “harassment”.

The Directive was introduced into UK Law by the Employment Equality (Sex Discrimination) Regulations 2005.   This legislation amended the Sex Discrimination Act.   However, from the outset criticisms were raised against the government that this new legislation failed to adequately implement the requirements of the Directive.  The Equal Opportunities Commission was particularly vocal in the debate.   These objections resulted in the legal challenge culminating in the High Court recommendation last year which prompted that the government re-cast the legislation in line with the Directive.   The end product of this activity is the Sex Discrimination Act 1975 (Amendment) Regulations 2008 (“the Regulations”) which came in to force on the 6th April 2008.

The lack of awareness and knowledge in the business community of the import of these changes has caused some dismay among knowledgeable observers of the business scene.  The rules have been hastily introduced with little or no support from the government for small businesses who will have to understand and implement them.   In fact, the special business interest website “BusinessZone.co.uk” set up an on-line petition calling for the delayed implementation of the Regulations.   Of course, it failed.   The Editor of that website Dan Martin has said “now yet again we are seeing hastily introduced rules which, while beneficial in protecting employee’s impose administration and cost burdens on small businesses and give them no time to prepare”. 

THE CHANGES

The following is a summary of the changes introduced by the new legislation:

  • Prior to the 6th April 2008, the law said that a person subjects a woman to harassment if on the grounds of her sex he engages in unwanted conduct that has the purpose or effect of violating her dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment for her.  The new law will substitute the phrase “on the grounds of her sex” with the phrase “related to her sex or that of any other person”.   This significantly widens the scope for claims to be made.
  •   New liabilities are imposed where an employer fails to protect their employee from harassment by third parties (such as a customer or a client).  An employer who fails to take reasonably practicable steps to protect employees from third party harassment where this harassment is known to have occurred on at least 2 previous occasions, will now be vicariously liable for those acts.   This puts the employer at risk of a claim for damages for harassment from employees.
  •  Extensive amendments are made to the right to claim discrimination in relation to terms and conditions during Maternity Leave.   A woman on Maternity Leave can now claim discrimination for non payment of a discretionary bonus for the 2 week period following child birth when she is on Compulsory Maternity Leave.   She can also now claim discrimination for non receipt of benefits during the Additional Maternity Leave period.  These changes, which will apply to woman whose expected week of childbirth falls on or after the 5th

October 2008, are significant.

  •          In relation to less favourable treatment on the grounds of pregnancy or exercising the right to Maternity Leave, the Regulations remove the requirement for a woman to compare her treatment to that of a woman who is not pregnant or not exercising the right to Maternity Leave.

WHAT WILL THESE CHANGES MEAN?

The changes to the definition of harassment are designed to address the High Courts criticisms of the definition of harassment under the 2005 Regulations.  Previously, harassment or unwelcome conduct was defined as being connected with an individual’s sex.  This meant that the conduct complained of would only be unlawful if it was engaged in by the perpetrator because of the complainant’s sex.  This type of sex related harassment has to be distinguished from sexual harassment which is harassment which has a sexual nature and which, of course, was outlawed under the Sex Discrimination Act regardless of whether or not it was actually directed at the complainant. 

The new definition of harassment is broader and will apply to sex related harassment even if not engaged in by the perpetrator because of the complainant’s sex.   The new definition of sex related harassment will apply to any unwanted conducted “related to the complainant’s sex or that of another person”.  What this means is that those who are not directly exposed to the unwanted conduct, will also receive protection.

It is relatively easy to see how this could apply in practice.  For instance, a person (male or female) who worked in an environment where there was a lot of sexist banter, could bring a claim if they found that banter to be offensive.  They would be able to bring this claim regardless of whether or not the offensive banter was caused by their presence and whether or not it was directed at them. 

The practical impact of this on the working environment is that employer’s will need to be particularly cautious in ensuring that such banter is not allowed to continue.  Some businesses may find this very difficult to control and implement.  Neither the legislation nor the government offer any helpful advice on how to do it.  Neither is it clear whether or not any attempt on the part of an employer to control the environment to ensure that such banter does not occur will be an adequate defence in the face of any claim.    One would hope that it would be but we will have to wait and see how the law will unfold.

However, this pales into insignificance compared with the new liability that employers could face in the form of complaints by employees of harassment by third parties (such as customers and clients).  

The Regulations define harassment in this context as something which has occurred on at least 2 previous occasions.   The Claimant must also show that the employer had direct knowledge of the harassment. 

On a practical level and in order to deal with these issues, it is very important that businesses have in place appropriate rules and procedures for the reporting of allegations of third party harassment and for dealing with them.   Staff have to be properly trained for dealing with such issues.   There should also be some mechanism for informing third parties that such unacceptable conduct is unwelcome (for instance a notice).   It also needs employers to be tough with customers where required in the interest of protecting their employees.   Some businesses might find this difficult in the case of particularly established or valued customers.

A technical change introduced by the Regulations is the elimination of the requirement for a comparator where discrimination is alleged on the grounds of pregnancy.  There is now no need to show a comparator and a woman will only have to show that she has been treated less favourably on the grounds of her pregnancy.  This lowers the bar for these claims to succeed. 

The final change introduced by the Regulations, is to remove the long standing distinction between Ordinary and Additional Maternity Leave.   Traditionally, an employees contractual rights continued during the period of Ordinary Maternity Leave but not in the period of Additional Maternity Leave.   This distinction has now been abolished and the same benefit should be afforded during both periods of Maternity Leave.   This has increased the financial burden of Maternity Leave on employers.  During both periods of Maternity Leave (Ordinary Leave is the first 26 weeks and Additional Leave is the second 26 weeks), the employee will now benefit from the same terms and conditions as would have applied to her had she been at work throughout the period (except for terms providing for her salary).   Contractual benefits (pension, leave, contractual bonuses) will continue during Additional Maternity Leave as well as ordinary Maternity Leave.

Businesses should therefore check their policies to ensure that they are fully compliant with and that they understand the new maternity regime.  

Businesses should also note that the changes only apply to employees who expected week of childbirth begins on or after 5th October 2008 so there is a short period of grace before the changes truly hit home.

These are the biggest changes to the Sex Discrimination Laws for some time.  Businesses and their advisers must ensure that they are aware of the import of the changes and are adequately equipped to meet them.

Author: David Malamatenios

Publication: New Law Journal

Date: May 2008