The 'Burden of Proof' provisions in discrimination cases in 2013 - Carl Fender

Wong v Igen Ltd and Madarassy v Nomura International plc crystallised the two stage test for tribunals to apply when determining whether a finding of discrimination should be made against an employer. That remained the position prior to the Equality Act 2010 coming into force. The new provision in s.136 of the 2010 Act introduced more flexibility into the process, though the need for a claimant to prove facts giving rise to an inference is still critical to the outcome.

Going back further still, cases such as Anya v University of Oxford sought to train our minds to make us more sensitive to the possibility of discrimination having occured at all. In each of these cases, it was recommended that facts should be assessed panoramically to see if they give rise to an inference of discrimination calling for a cogent explanation from the employer. By adopting this practice, we can avoid two pitfalls. One is of not seeing a claimant's case at its full potential. The second is to avoid thinking the burden should pass by reason of differential treatment coupled with the proscribed ground applicable to a particular claimant; it requires the fact finder to look for more than just these features alone.

The burden of proof provisions only apply in cases where a tribunal is seeking to infer just what motive was influencing a certain person's actions. Not every case will call for the provisions to be deployed. A distinction needs to be drawn between what are sometimes descrived as 'criterion' and 'motive' cases. It is only in the latter category that the provisions have relevance. However, even in 'motive' cases the provisions do not always need to be applied. Often words or actions are capable of being made the subject of positive findings or where a person's motive is known and the issue is one of legal characterisation.

One of the more agonising exercises for anyone practising in this area is to determine whether there are facts from which a tribunal could infer some discrimination in order for the burden of proof to pass to the employer. Less favourable treatment coupled with the proscribed ground relied upon has been regarded as insufficient to shft that burden over to the employer. Bearing in mind that claimants will have to rely on inferences drawn from a wide range of circumstances, interpreting events one way or the other can be a precarious exercise. Such events could be equivacol in pointing one way or the other, towards or away from a prima facie case. When discrimination is so often hidden, and when clients cannot say for sure whether a discriminatory motive exists, even subconsciously, in the mind of a work colleague, a client's instinct for having suffered some discriminatory disadvantage will need a sensitive barometer to divine whether the wind is blowing in the direction we would like it to.

Three cases in 2013 remind us of the challenges tribunals have in approaching this exercise. The reminders about good practice reinforce how the proper approach can act as a litmus test for those advising clients on both sides of the contest.

The three cases are X v Y [2012] UKEAT/0322/12/GE; Osoba v Chief Constable of Hertfordshire [2013] UKEAT/0055/13/BA and IPC Media v Millar [2013] IRLR 707.

X v Y was a case with anonymity orders applying. However, the relevant sector was that involving the rehabilitation of offenders. The Claimant, a lady of black African descent, succeeded in her claim for unfair dismissal (a constructive dismisssal). Her claim relied on a succession of incidents where the tribunal had found the employer had breached the implied term of mutual trust and confidence. There were a large number of serious breaches. The tribunal had failed to step back and consider the cumulative effect of those breaches to see if they gave a flavour of discrimination. The tribunal had made the error of considering each incident separately and had determined that each was a separate episode of management inefficiency only. Separate consideration of each episode emasculated the Claimant's case and led inevitably to a dismissal of her claim for discrimination. The treatment had clearly been less favourable, but had not been motivated by race the ET said.

The wisdom X v Y passes on is about the need to look for something more than differential treatment and proscribed ground. The trap tribunal's often fall into by separate treatment of incidents is that the approach is more likely to be self-fulfilling for someone looking for no discrimination. It can often lead to poor management being treated as the reason for the detriment, rather than it being seen as manifestation of racial motive.

In Osoba, an appeal against the dismissal of an age discrimination claim was upheld by the EAT. The Claimant who was entitled to retire but who had indicated his intention not to do so had been selected for redundancy. He said it was on the grounds of age. The officer conducting the selection exercise made a shambles of it, but resisted the suggestion that of deliberate manipulation of the selection exercise. The officer had repeadtedly admitted fault and the tribunal found that this honest explanation for the Claimant's selection had been the only motivating factor. The tribunal found the burden shifted to the employer and the issue became one of determining whether the reason advanced by the employer rebutted the inference.

The issue was therefore a narrow one. Was the officer's explanation adequate to defeat the Claimant's case? Here it was. The explanation was rooted in the incompetently carried out selection exercise. Tribunal's are frequently offered denials based on lack of motive (eg 'the Claimant's age/race/sex etc played no part in the decision') or other remote reasons which are less capable of being tested (eg 'I was overworked' or 'I had other responsibilities'). Here, however, the explanation was contextualised by the disputed redundancy exercise itself. The tribunal was not expected to look for any other reason to find the employer had done enough to rebut the inference.

IPC Media v Millar was a case where a claim of disability related discrimination was wrongly upheld by an employment tribunal. That decision was overturned on appeal. The error made by the tribunal in this case yields some important lessons for the discipline of divining whether or not there may be a case to answer. The case involved a reduncancy situation for an editor at a magazine. She had been off sick for some time because of knee problems. She was not offered positions in the re-structure and the tribunal found the reasons advanced by the employer for not offering alternative posts to her unconvincing. The case was decided principally on the nature and extent of the knowledge of the decision-maker about the Claimant's disability. The tribunal had failed to really address its mind to the facts giving rise to the inference at all and more or less assumed a case to answer existed. Had it done so, it would not have found the Claimant's case to have crossed the threshold at stage 1. The EAT made it clear that even at stage 1 of the burden of proof test, it is still important for the tribunal to make findings about what facts which in its view will allow the burden to pass.

The learning of these three cases encourages us to be clear about just what facts may give rise to an inference of discrimination in order for the burden of proof to pass to the employer. Coupled with that first principle is the need to determine the knowledge on the part of the employer of the facts which gives rise to the inference. This must be knowledge possessed by the employer's decision-makers. No-one can consciously or subconsciously discriminate about facts of which they are unaware. Where the burden has passed, what reasons are advanced, and are they cogent in the context of the subject matter of the dispute?

The write suggests these three cases offer valuable guidance to those practising in this area.

Carl Fender
Regency Chambers
Peterborough
13th November 2013

IPC Media Ltd v Millar - Carl Fender

A recent decision of the EAT, demonstrates the difficulties associated with applying the burden of proof provisions in discrimination cases and the often delicate task of distinguishing between the proper drawing of inferences to suppor the reversal of the burden of proof, and more speculative findings which do not.

The C has been an assistant editor at one of R's magazines but developed serious knee problems that occasioned surgery and significant time off work. In 2011, two of R's magazines merged which triggered a redundancy consultation. C was at risk of redundancy and her employment was eventually terminated. At an appeal, C raised her age and health. C was told of alternative positions she could apply for but they had not been confirmed as part of the re-structure. The dismissal was confirmed and claims under ss.13 and 15 EqA 2010 were brought.

At the ET, the claim under s.15 succeeded only. In so finding the ET concluded that s.136 operated against R because it had failed to provide an explanation for the primary facts which cast the burden upon it. The facts were first, the absence of 'persuasive evidence' from R explaining why C had not had the opportunity to apply for the alternative posts and the decision to delay advertising them until after her dismissal, and second, C's absence due to the knee problem.

The EAT allowed the appeal and dismissed the claim. What the ET had failed to do in this case was consider the primary facts in light of the state of knowledge of the person who had made the dismissal decision. The knowledge related to what was known about C's disability and her time off. There was insufficient evidence the decision maker knew anything of C's background and this converted the primary facts into more speculative inferences in the eyes of the EAT. The case perhaps demonstrates the dilema of drawing inferences from facts where at the same time one is trying to divine whether subconsciously a prohibited grould may have operated on the mind of a decision maker.

EMPLOYMENT TRIBUNAL FEES - Carl Fender

The 29th July 2013 is the anticipated date for the introduction of the two tier tribunal fees order. Those wishing to bring claims before the tribunal will have to pay an issue fee, and if the case does not settle, a hearing fee disposal of the case. The level of fees are determined by which category, A or B, the claims fall into. Category A deals typically with 'money' claims for wages, holiday pay and breach of contract. The issue fee here will be £160 and for any hearing £230. Category B relates to claims for unfair dismissal and discrimination. The applicable fees will be £250 and £950. For claims involving more than one element, increased fees and hearings apply; these are dependent on the number of claimants in the group. For category A cases, the issue/hearing fees are £320/£460 (for 2-10 claimants), £640/£920 (11-20) and £960/£1380 (200 plus). For Category B, the issue/hearing fees are £500/£1,900 (2-10), £1000/£3,800 (11-200) and £1,500/£5,700 (200 plus).

There will also be fees for interlocutory applications and counterclaims so this means some fees will also fall on respondents. There are rules also for the remission of fees which is expected to be means assessed.

7 Employment Law Updates - quick view

Forthcoming Changes

1.Employee Shareholders
Employee shareholders in the new Growth and Infrastructure Bill

• New category of employee
• Law by April 2013
• Give up rights for ordinary UDL, SRP, time to train & right to request flexible working
• Longer notice when returning from parental leave

PROBLEMS

• Overwhelmingly coldly received and 80% of employers said it would not affect recruitment
• How will ET deal with claims where value of the shares is said to be <£2,000
• Additional rights: dividends, voting, transfer - can these be limited?
• Applied as lever in the workplace?
• For high risk takers only?

2. Whistle Blowing
Amendment to s.43B ERA

• Relates to Qualifying diclosure
• Worker must reasonably believe it to be in PI
• Parkins v Sodexho and hte problem of employees contractual rights
• Protections for whistle-blowers from bullying subject to defence of reasonable steps
• Good faith requirements to be removed with power to reduce compensation by up to 25%
• ERRB 2013
• Possible settlement by ACAS first with a certificate stating not possible or a prescribed period has expired
• New schedule to the 2004 rules
• Practice Directions from the President
• April 2013 for all

3. Changes to the EqA

• Removal of liability for harassment by third party: s.40(2)-(4)
• Abolishing of questionnaire procedure: s.138
• Repeal of ET's power to make wider recommendations: s.124(3)(b)
• Repeal of all March 2013

4. Settlement Agreements
A new s.111A ERA 1996 is intended for ordinary UDL claims by April 2013

• The new name for compromise agreements
• Past problems with 'without prejudice' negotiations and the need for a dispute for them to bite against
• Pre-termination negotiations will be inadmissible unless there has been improper behaviour  which the ET considers it just to take into account
• Statutory CoP to deal with improper behaviour
• Auto UDL, discrimination, breach of contract not covered
• Therefore, rules only apply in cases where there are no claims parallel to ordinary UDL
• Problems of hearing the evidence before declaring inadmissible - becomes then a question of weight
• Improper behavour e.g. bullying, language that is discriminatory
• Relevant to cases of poor performance where employers want to avoid lengthy performance management

5. Compensation

• Possible substitution of the current maximum figure (£72,300) with either:
• (a) specified amount with a statutory floor and ceiling based on annual median earnings, currently about £26,000 (the ceiling would be no more than 3 times the median figure), or
• (b) the lower of either a specified amount or a specified number of week's earnings which cannot be less than 52
• Reasons for this not credible (i.e. the ceiling is too high).  There has been an inflationary catch-up since 1999.
• Disproportionately affect higher earners/older workers/those out of work after 52 weeks

6. Financial Penalties
It is proposed in the Bill that, where a tribunal considers that an employer has
a). Breached an employee's right(s); and
b). The breach has 'aggravating features'
It may impose a financial penalty.
The penalty shall be not less than £100 and not more than £5,000 and is payable not to the employees but to the Secretary of State.  If paid within 21 days the penalty is effectively discounted by 50%.
The Bill is expected to receive Royal Assent in April 2013.

Comment
 In the consultation document the Government deals shortly with this and says that this is intended to deal with situations where the employer has acted with malice or negligently, nto simply inadvertently.  It must be expected, that, without further guidance (and none is specifically proposed on this), allegations of aggravating factors will become commonplace, partly no doubt as a means of imposing greater pressure in litigation but also as a result of the uncertainty of what is meant by the term.  Again it may take some time before case law offers guidance.

7. Parental Leave

2015

• Flexible parental leave will be introduced.
• Default position remains: mothers entitled to 52 weeks' maternity leave
• Elligible mothers to receive statutory maternity pay for 39 of these 52 weeks
• Paternity leave & pay will continue to last for 2 weeks for eligible fathers

Under the new system, instead of the current postioin where fathers have to wait until 20 weeks after childbirth to commence their addiitonal paternity leave, parents (if they both meet certain criteria) can now share 50 of the 52 weeks' leave (as the first 2 weeks are mandatory maternity leave).  For example, they may decide that the mother returns to work 2 weeks after giving birth and the father takes the remaining 50 weeks' leave.

To qualify, each parent must meet the criteria.  These are proposed to be the same as those for ordinary paternity leave - 26 weeks' continuous employment by the 15th week before the due date.

Alternatively, parents can pick and choose specified blocks of parental leave of no less than one full week over that 50 week period.  They can take the leave separately or, similar to Scandanavian countries, they can take time off at the same time.  The leave will be paid at the usual statutory rate (or more if the employer offers enhanced payments).

2013

• The current right to unpaid parental leave will remain, but will increase from 13 to 18 weeks to comply with European requirements.
• Child's age limit for parents to take such leave will increase from 5 to 18 years old

Carl Fender
Regency Chambers
March 2013

THE 2012 FRAUD AND EXAGGERATION IN PERSONAL INJURY CLAIMS CONFERENCE - Paula Thomas, Barrister at Regency Chambers

THE 2012 FRAUD AND EXAGGERATION IN PERSONAL INJURY CLAIMS CONFERENCE

On 24^th May 2012 I attended the Fraud and Exaggeration in Personal Injury Claims Conference in Leeds. Yes, such is the scale of the problem in the UK that an entire conference was dedicated to this topic and this is only personal injury linked to motor accident claims. Overall a good conference and even for those professionals who have little to do with personal injury claims or motor insurance, it was informative. The Conference boasted a pool of guest speakers including the Right Honourable Jack Straw MP, Nick Starling, Director of Association of British Insurers (ABI); the Assistant Chief Constable of West Yorkshire; Dr Michael Powers QC as well as other notable professionals.

The topics included the extent of fraud and exaggeration; the role and duty of medical legal experts; contempt proceedings and prosecution; medical evidence in fraud cases; how Claimant’s solicitors should respond; costs consequences and sanctions.

Most people may consider this problem has very little to do with them, how wrong they are. Just to place things in context, there are over 133,000 fraudulent claims detected each year, with a saving of £100 million. In spite of this, fraud in this area is on the increase, in 2011 there was a 32% increase in the number of reported ‘induced’ collisions; a 6% increase in the number of ‘staged’ collisions; and the number of identified ‘fraud rings’ increased by 32%. Britain is reported to have a culture of “Crash for Cash,” The UK is known as the ‘Whiplash Capital of Europe’ indeed, in France only 3% of bodily injury is linked to cervical trauma; Spain 30%; Germany 47% compare any of these to the UK boasting 76%.  The average policy holder pays an extra £50 per annum on their insurance premium to compensate for these errant activities.

Just to give an example of a ‘staged’ claim: you may be following a vehicle, generally an ageing car or van, onto a roundabout or slip road. This vehicle, which often has no brake lights, brakes hard and you cannot avoid slamming into it.  Another example may involve two other cars. One is in front of you and another one may veer into its path, the car in front of you brakes hard and you crash into it. The net result a bogus claim is submitted on the blameless motorist's insurers.

So what is the Government doing about it? Since January 2007 there has been criminal legislation under the Fraud Act 2006, to prosecute the same, but as to how effective this has been in prosecuting this kind of fraud is a matter for a separate article. In respect of civil sanctions, CPR rule 32.14, governing ‘false statements,’ has been used with some success to bring to task perpetrators (South Wales Fire & Rescue v Smith; Edward Neil, Acromas Insurance Company Limited v Graham Jeffrey Loveday [2011] EWHC 2324) and of course there is always the tort of deceit and exemplary damages. All is not lost even if fraud is discovered after the case has been settled; there can be a retrial (Hussain & Anor v Sarkar CA 2010). Where Claimants have exaggerated or been fraudulent there are of course costs implications, with Defendants seeking to strike out claims under CPR 3.4(2) on the grounds of collateral dishonesty, Shah v Ul Haq [2009] EWCA Civ 542.

In terms of the way forward, the Legal Aid, Sentencing and Punishment of Offenders Act 2012, which amongst other things makes payment or receipt of referral fees by lawyers, claims management companies and insurers illegal, although the detailed provisions will need to be made by the relevant regulators, (the Solicitors Regulatory Authority, the Bar Council, Claims Management Regulator and Financial Services Authority).  There are now specialist agencies, in particular the Insurance Fraud Enforcement Department (IFED) run by the City of London Police, a bespoke police unit of 35 staff funded by the ABI. They will investigate fraud in England and Wales.  In the next 3 years there will be an insurance fraud register. Currently specialist data mining software is used to identify links and of course social media sites have had their part to play in detecting fraud, these include FaceBook, Twitter, LinkedIn: hi5; Netlog; Tagger; YouTube, MySpace; g+; and bebo, and noteworthy successes include Locke v Stuart & AXA Corporate Solutions , 2011.

Outside of the legal process, what advice can the innocent victim take on board from all of this? The response is ‘avoidance.’ The Insurance Fraud Bureau has produced a useful leaflet which I consider all motorists should read. As well as this advice, I would suggest always keep your distance from the car in front, not just at roundabouts and slip roads but on all occasions. Keep an eye on the vehicle in front, sometimes the occupants may turn to look at you or may even make a gesture just before the trap is sprung. http://www.insurancefraudbureau.org/files/misc_pdfs/consumer_advice_-_crash_for_cash_scams.pdf

On closing I would just like to say, keep yourself safe on the road and be aware that for some people this is just a business and it may end up costing you more than just an increase in your premiums!

LAPSO Bill amendments - by Nigel Sleight

It would seem that the furore around the passage of the Health Bill through the House of Lords has prompted the Government to be more pro-active and concessionary in relation to the proposed Legal Aid changes which go back before the Lords next week. Today the Ministry of Justice has announced that two amendments to the Bill have been tabled - one being to adopt the ACPO definition of domestic violence - this is theory should ensure that legal aid will be available for people to cover any family proceedings relating to injunctions, children and finances that may include emotional, psychological and financial abuse as well as the more obvious phsycial as well.

I say in theory though - as whilst the proposed change is a step in the right direction it will make little practical difference until the gateways (the trigger for a person to be eligible for legal aid) are susbtantially widened and less onerous in their evidential requirement(s). The very fact that someone is/has suffered from domestic violence makes it less likely for example that they may have reported the matter to the police. Often the applications that the court has to deal with are on an emergency basis - this will be very difficult if the gateways remain as they are drafted. One way in which funding can be obtained is if the intended recipient can show that they have obtained a finding of fact from a court against the alleged perpetrator. This of course is a question of chicken and egg - as if they require legal aid due to their vulnerable position how on earth are they have meant to have already paid for or represented themselves at a hearing to obtain findings of abuse against the perpetrator.

One can only hope (big doubtful sigh!) that further reflection on the proposals will occur in the coming weeks.

Postponement of Legal Aid Changes - Nigel Sleight, Barrister at Regency Chambers

In a quietly released Ministerial Statement today Ken Clarke, Lord Chancellor has announced the
postponement of the proposed Legal Aid reforms currently going through the House of Lords until April 2013 at the earliest. If approved by the Upper House (or amended) the proposed reforms were due to be implemented in October 2012, part of the reasoning appears to be in light of the new business structures which legal firms can now enter into, competitive price tendering and giving firms more time to adjust.

This announcement may give some modicum of relief to those practitioners at the sharp end of practice - however it is just a delay at this stage. It can only be hoped that a longer period of time for reflection on the impact of the proposals may help persuade the Government of an alternative course. The reduction in fees of 10% will still be implemented as planned next year.

Read the full ministerial statement here:

http://www.parliament.uk/documents/commons-vote-office/9.Justice-LegalAidReform.pdf