osborneclarke.com The Equality Act 2010
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- Augusta Hamilton
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2 As the election dust settles and the new Government begins to deliver in practice on its coalition agreement, the Equality Act 2010, which seems to have been hovering over employers for an eternity, will soon become a reality. Whilst the new Government may still relieve employers of one or two provisions, take note, the majority of the Act will apply from 1 October. Below are the key concepts and changes employers will need to grapple with. Be aware though - the devil is in the detail and specific issues will be covered more fully in further updates. What is it? The Act essentially replaces our existing discrimination legislation. In doing so, it harmonises and clarifies those laws and extends them to support progress on equality. Statutory Codes of Practice will interpret the Act and give practical advice to employers whilst not binding, these Codes may be taken into consideration by an Employment Tribunal in any proceedings. This update simply focuses on employment issues the Act however applies more widely for example in relation to the provision of goods and services. New terminology protected characteristics? A new term "protected characteristic" is introduced to identify those afforded protection under the Act from discrimination, victimisation and harassment. Protected characteristics remain unsurprisingly: Age Disability Race Religion or belief Sex, marriage & civil partnership, pregnancy and maternity and gender reassignment; and sexual orientation. Employees, job applicants, contract workers and the genuinely self-employed may all have protected characteristics for the purposes of the Act. Workplace changes Set out below are the significant changes impacting on the workplace that employers will need to consider and action when the provisions come into force: Recruitment and health Care will need to be taken in determining if and if so, what questions to ask job candidates about their health. Whilst questions regarding health will be permitted during recruitment, employers beware if such questions are asked and an applicant subsequently brings a discrimination claim in light of any steps you have taken, such as rejecting their application, in general the onus will be on you, the employer to prove there was no discrimination. This may be extremely difficult. Limited circumstances are provided for where health related questions can be asked without the threat to the employer of the potential burden of disproving claims. These circumstances include: assessing whether a candidate is able to perform a function intrinsic to the job; monitoring for diversity; and establishing whether the candidate is able to attend the proposed interview However, these are themselves potentially fraught with potential difficulties e.g. What functions are intrinsic? We shall be issuing a further update on this area. Queries as to health may always be raised post making an offer of employment and/or job offers made conditional on a satisfactory medical. However, in practice great care will be needed in subsequently withdrawing any such offer. Positive action in recruitment and promotion There will remain no legal obligation on employers to positively discriminate. But it may be that an employer will be permitted to do so, if it so wishes, in recruiting and promoting where two candidates are "as qualified as" the other. We say "may" since the Conservatives in their pre-election manifesto indicated that they would not bring this provision into force. 2 of 5 Osborne Clarke June 2010
3 An employer will be permitted (but is not required) in recruiting or promoting to a position to positively discriminate in favour of an individual from: an actual or perceived; under-represented or disadvantaged protected group where it has the choice between two or more candidates. However, there are two big provisos that individual must be "as qualified as" the other candidate(s) who would otherwise be selected and the employer must not have a general policy of positively discriminating in favour of someone from that group in every case. The discretion to do so should be exercised on a case by case basis. "As qualified as" is not currently defined. However, it is likely to extend beyond mere qualifications to include skill, experience etc. At present, positive action may only be taken to train or encourage under represented groups to apply for jobs Pay Transparency Measures are introduced in an effort to rule out discrepancies in pay: Contractual "secrecy clauses" on pay will still be permitted. However, an employer cannot prevent employees discussing pay where they are seeking to establish whether or not there are differences and hence potential discrimination. The Act provides for potential future legal obligation on private sector employers with at least 250 employees to publish information regarding the differences in pay between female and male workers. Secrecy Clauses Employers may still validly insert clauses in employment contracts banning employees from discussing pay in general. However, an employer will not be able to enforce this provision against an employee to prevent him or her discussing pay where he or she is seeking to establish whether or not there is a difference in pay and that is connected to having or not having a particular protected characteristic (a "relevant pay disclosure"). Action taking against an employee for making or seeking to make a relevant pay disclosure will be unlawful victimisation. Equal Pay Audits Whilst there is no immediate legal obligation on private sector employers with at least 250 employees to undertake an equal pay audit (the earliest it will be brought into force is 2013 and only if considered necessary), employers may want to take a look at their practices in this regard since: Voluntary and regular publication of statistics is instead to be encouraged. The EHRC is developing a set of metrics for gender pay reports in consultation with business unions and others over the Summer and will monitor progress on reporting within the private sector annually. There may be an impact on public/private outsourcing. Associated Discrimination It will be unlawful to discriminate against or harass a person on the grounds that they are associated with a protected person i.e. someone who has or is perceived to have a protected characteristic. Employers have already had to change practices in light of the Coleman case which interpreted the Disability Discrimination Act 1995 to protected a mother who was harassed and discriminated against by her employer when seeking to look after her disabled son. The Act will require employers to adapt their practices even further since, for example, employees who care for elderly relatives will now be protected. Harassment policies will also need to be revisited to ensure the concept of harassment by association is covered, such as where an employee is harassed due to their partner undergoing gender reassignment. Disability Discrimination The Act introduces offences of indirect disability discrimination and discrimination arising form a disability. In introducing these new offences, employers will need to face the fact that the Act essentially overturns Malcolm (which made it more difficult for employees to establish discrimination). Indirect discrimination will arise where an employer puts in place a provision, criterion or practice that whilst neutral on its face, will place disabled persons as a group at a disadvantage unless such provision, criterion or practice is a proportionate means of achieving a legitimate aim. "Discrimination arising from disability" protects a disabled person from an employer treating him/her "unfavourably because of something arising in consequence of" that individual's disability such as dismissing or ending sick pay unless such treatment was a proportionate means of 3 of 5 Osborne Clarke June 2010
4 achieving a legitimate aim and/or the employer did not known or could not reasonably be expected to know of the disability. It will remain unlawful to directly discriminate, harass or victimise a person because of a disability. The obligation to make reasonable adjustments also continues but imposes an explicit requirement to take reasonable steps to provide an auxiliary aid where but for the provision of such aid, a disabled person would be at a substantial disadvantage. Combined Discrimination The Act prohibits discrimination against a person because of a combination of two of the following protected characteristics sex, race, disability, age, sexual orientation, religion/belief or gender reassignment. So it would be unlawful to discriminate against a woman because she is an "Asian woman". Only direct discrimination is outlawed. Essentially this extends the scope of discrimination law to new categories of persons. For example, previously an Asian woman may have had no claim where the discrimination was not because she was a woman nor because she was Asian it was because she was an Asian woman. The combination of two protected characteristics cannot not include pregnancy and maternity or marriage and civil partnerships. Equal Pay The Act: adapts existing equal pay law, introducing a legitimate aim for employers in defending unequal pay of the "long term objective of reducing an inequality between men's and women's terms of work" (but still subject to the principle of proportionality). allows an equal pay claim where there is evidence of direct sex discrimination in relation to pay without need for an actual or hypothetical comparator. Recommendations by Tribunals Be aware a discrimination case that proceeds to trial and is successful for the claimant brings with it the risk of a recommendation from the tribunal impacting on the whole workforce. At present, an Employment Tribunal can only make recommendations to an employer that reduce the effect of discrimination on the claimant. The Act will extend this to recommendations that may impact further across other members of the workforce. Such recommendations might include, re-training staff, publishing selection criteria used for staff transfer or promotion and setting up a review panel to deal with equal opportunities harassment and grievances. Whilst not binding, a failure to comply could be damaging to an employer's reputation and be used in evidence against the employer in future discrimination claims. Other Discrimination Related Issues The Act also introduces and/or clarifies the following matters all of which we shall touch on in more detail in future updates: The Act includes a provision to ban discrimination and harassment because of caste. Whether or not this is introduced will depend on a review currently taking place. Transsexuals are protected from discrimination and harassment where they propose to undergo or have undergone a process for gender reassignment. There is no need for ongoing medical supervision or surgery. An individual will be protected from discrimination and/or harassment where they are perceived to have a protected characteristic even if they do not actually have that characteristic. The requirement for a comparator in victimisation claims is removed. Protection against harassment by a third party is extended to all the protected characteristics except for marriage and civil partnership and pregnancy and maternity. Public Sector Equality and Pay The Act creates a new single public sector equality duty applicable to all protected characteristics save marriage and civil partnership. Presently only race, gender and disability are covered. The duty essentially requires public bodies to have regard to a need to eliminate discrimination and harassment, to advance equality of opportunity and to foster good relations between those who share protected characteristics and those who do not. Public bodies will also have a mandatory duty to promote equality when making strategic decisions as to how to exercise functions. The intention is for public bodies to use public procurement to drive equality. Regulations will set out how public bodies should go about doing this. Public bodies with more than 150 employees will be required to report on gender pay as well as other equality data including ethnic minority and disability statistics by April of 5 Osborne Clarke June 2010
5 Action The Act contains a lot for managers, HR and employment lawyers to get on top of. As a start: Look out for our further updates over the next few months. In the meantime, please do not hesitate to contact your usual Osborne Clarke contact or any of the contacts at the end of this insight if you need further advice. Make time over the Summer to consider the impact of the new Act and timetable any changes you will need to make. Policies and procedures will need reviewing and amending including those on equal opportunities and diversity, harassment, flexible working and recruitment. In addition, in-house compromise agreements will need updating. Arrange training for HR and as appropriate line managers. We shall be happy to talk to you about any training needs you may require or you would like to put in place for your staff. Familiarise yourself with the new Codes of Practice and guidance issued by the Equality and Human Rights Commission. Whilst not binding, the Codes of Practice may be taken into consideration by an Employment Tribunal. Timetable: Employment Related Issues September 2010: Publication of non-statutory guidance October 2010: Harmonisation, clarification and extension to discrimination laws Positive Action in recruitment and promotion Ban on secrecy clauses preventing discussions to ascertain unequal pay New Codes of Practice issued by EHRC April 2011: Public sector employers gender pay and equality reporting April 2013 Private sector employers gender pay and equality reporting Contact We shall be issuing further insights on specific areas of the Act and will be happy to advise you further. In the meantime if you require any further information or advice please do not hesitate to contact your usual Osborne Clarke contact or: Julian Hemming Partner julian.hemming@osborneclarke.com Kath Sadler-Smith Associate kath.sadler-smith@osborneclarke.com Catherine Shepherd Associate catherine.shepherd@osborneclarke.com 5 of 5 Osborne Clarke June 2010
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