Changes to sex discrimination law and maternity rights
We provide guidance on the recent amendments to the Sex Discrimination Act 1975 by the Sex Discrimination Act 1975 (Amendment) Regulations 2008. The changes relate to harassment, including third-party harassment, the definition of discrimination on grounds of pregnancy or maternity leave and rights during maternity leave.
Key points
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Introduction
The former Equal Opportunities Commission brought successful judicial review proceedings over the implementation of the Equal Treatment (Amendment) Directive (2002/73/EC) through the Employment Equality (Sex Discrimination) Regulations 2005 (SI 2005/2467) (Equal Opportunities Commission v Secretary of State for Trade and Industry [2007] IRLR 327). As a result, the Sex Discrimination Act 1975 (Amendment) Regulations 2008 (SI 2008/656) were introduced to implement the Directive properly.
The Regulations came into force on 6 April 2008 and amended provisions in the Sex Discrimination Act 1975 in relation to harassment, the definition of discrimination on grounds of pregnancy or maternity leave and rights during maternity leave. This article examines the changes.
Sex-related harassment
The Sex Discrimination Act 1975 covers two types of harassment: sex-related harassment, which does not have to be of a sexual nature, and sexual harassment (s.4A). Although the legislation refers to a woman being harassed, it should be read as applying equally to men.
Prior to changes introduced by the amendment Regulations, under s.4A(1)(a), a person subjected a woman to harassment where, "on the grounds of her sex, he engage[d] in unwanted conduct that ha[d] the purpose or effect of violating her dignity, or of creating an intimidating, hostile, degrading, humiliating or offensive environment for her". This covered, for example, the situation where a harasser bullying a female employee would not have treated a male employee in the same way.
Under s.4A(1)(b), which is unchanged by the amendment Regulations, a person subjects a woman to sexual harassment where "he engages in any form of unwanted verbal, non-verbal or physical conduct of a sexual nature that has the purpose or effect of violating her dignity, or of creating an intimidating, hostile, degrading, humiliating or offensive environment for her". Examples include displaying pornographic material and making unwanted sexual suggestions.
Conduct is to be regarded as having the effect of violating the recipient's dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment only if, having regard to all the circumstances, including in particular the perception of the recipient, it should reasonably be considered as having that effect. The harasser's intention is irrelevant if the conduct has the requisite effect.
The amendment Regulations have widened the definition of sex-related harassment in s.4A(1)(a). A person now subjects a woman to sex-related harassment if "he engages in unwanted conduct that is related to her sex or that of another person and has the purpose or effect of violating her dignity, or of creating an intimidating, hostile, degrading, humiliating or offensive environment for her". The unwanted conduct no longer has to be "on the grounds of" the recipient's sex. This removal of the causal link between the harassment and the sex of the person being harassed means that a claim can now be made by someone who has not been subjected to the unwanted conduct personally, but where the effect of it nonetheless violates his or her dignity or creates an intimidating, hostile or offensive environment for him or her. For example, offensive remarks related to the female sex, such as "blonde" or "mother-in-law" jokes, could have the effect of creating an intimidating or humiliating environment for either a male or a female employee, and therefore amount to harassment.
In light of the changes, employers should review their policies on harassment to ensure that harassment is clearly stated to include both conduct of a sexual nature and unwanted conduct related to sex. It should also be made clear that an individual can complain of harassment regardless of whether the unwanted conduct is directed at him or her, or at another individual, so long as the effect, if not the purpose, is to create an intimidating, hostile or offensive environment for him or her. Employers should provide relevant training to ensure that all managers and employees understand their rights and responsibilities in this regard.
Third-party harassment
Arguably the most significant change introduced by the amendment Regulations is the provision for employer liability for repeated third-party harassment that the employer has failed to take reasonable steps to prevent. This is likely to have a particular impact on employers whose employees regularly deal with customers or clients, for example those in the sales and service industries.
In Burton v De Vere Hotels Ltd [1996] IRLR 596 the employer was found to be vicariously liable for the discriminatory acts of third parties - abusive remarks made by a speaker and guests to waitresses catering an event. However, the House of Lords in Macdonald v Advocate General for Scotland; Pearce v Governing Body of Mayfield School [2003] IRLR 512 overruled Burton, deciding that an employer would be liable for the actions of third parties only if the employer itself was acting in a discriminatory manner in failing to prevent the harassment.
The amendment Regulations introduced s.6(2B) into the Sex Discrimination Act 1975. This states that an employer will be treated as subjecting an individual to harassment where the individual is harassed by a third party during the course of employment and the employer has failed to take reasonable steps to prevent the harassment. The third party might be, for example, a customer, client or visitor.
The employer will not, however, be liable unless it knows that the individual has been subjected to harassment by a third party - whether the same or a different one - on at least two other occasions. There is no time limitation on when the previous incidents must have occurred.
To prove harassment, a claimant will usually have to show a course of conduct, although one incident could amount to harassment if it is sufficiently serious. Since, for an individual to be able to bring a claim under the new third-party provisions, harassment must have occurred on at least two other occasions, the claimant will have to show that the employer knew about each incident and that each amounted to harassment.
Where a claimant cannot mount a claim under the new provision, there may be circumstances where the employer could still be liable under Pearce if it acted in a discriminatory manner in failing to take action to protect an employee in circumstances involving persistent offensive conduct about which it knew but did nothing.
Employers will need to review their policies on sex-related and sexual harassment to ensure that third-party harassment is included, and look at the procedures that they have in place for handling complaints about harassment by third parties. They would be wise to assume that they should also protect employees from other types of harassment by third parties. It is arguable that the current provisions on harassment in relation to the other strands of discrimination are in breach of EU law and should be amended to bring them into line with the third-party provisions in the Sex Discrimination Act 1975.
Discrimination on the ground of pregnancy or maternity leave
Prior to 6 April 2008, s.3A(1) of the Sex Discrimination Act 1975 provided that: "A person discriminates against a woman if:
- at a time in a protected period, and on the ground of the woman's pregnancy, the person treats her less favourably than he would treat her had she not become pregnant; or
- on the ground that the woman is exercising or seeking to exercise, or has exercised or sought to exercise, a statutory right to maternity leave, the person treats her less favourably than he would treat her if she were neither exercising nor seeking to exercise, and had neither exercised nor sought to exercise, such a right."
The amendment Regulations have changed the definition by removing the need for a comparator. This means that a woman no longer has to compare her treatment to how she would have been treated had she not become pregnant or exercised, or sought to exercise, her statutory right to maternity leave. To bring a claim she will have to show simply that she has been treated less favourably for a reason related to her pregnancy or maternity leave.
The new test makes it clear that any less favourable treatment as a result of pregnancy, or factors related to pregnancy such as sickness, tiredness or inability to do the job on health and safety grounds, is unlawful regardless of whether or not a person who is not pregnant would be treated in the same way.
In many cases the change in the law will have little practical effect, as the case law has been consistent with the Equal Treatment Directive definition, which makes it clear that any unfavourable treatment related to pregnancy and its consequences is unlawful. The test in most cases is "but for" her pregnancy would a woman have been treated in the way that she has? For example, where a woman has not been promoted, would she have been "but for" her pregnancy? However, there may be some cases where a claim for discrimination could have failed if a woman had had to compare her position to her non-pregnant state.
Rights during maternity leave
The amendment Regulations make significant changes to employees' rights during maternity leave, although the changes affect only those with an expected week of childbirth beginning on or after 5 October 2008.
There are two periods of maternity leave:
- ordinary maternity leave, which lasts for 26 weeks and runs from the start of the maternity leave period; and
- additional maternity leave, which also lasts for 26 weeks and begins the day after the end of ordinary maternity leave.
While statutory rights, such as the right to minimum annual holiday, apply throughout both ordinary and additional maternity leave, where an employee's expected week of childbirth begins before 5 October 2008, and she is therefore unaffected by the changes introduced by the amendment Regulations, her contractual rights during maternity leave depend on whether she is on ordinary or additional maternity leave. During ordinary maternity leave she is entitled to her normal contractual rights, apart from the right to remuneration, as if she were still at work. However, during additional maternity leave, only some of her contractual rights continue: she is entitled to the benefit of her employer's implied obligation to her of trust and confidence and any terms and conditions of her employment relating to:
- notice to terminate her contract of employment;
- redundancy pay; and
- disciplinary or grievance procedures.
This means that, during additional maternity leave, the employee does not have the right to contractual benefits such as her company car or holiday entitlement over and above the statutory minimum. In addition, while time spent on additional maternity leave must be taken into account for the purpose of calculating statutory benefits based on length of service, such as redundancy pay, it does not have to be counted when calculating service for contractual rights based on length of service.
The amendment Regulations impact on s.6A of the Sex Discrimination Act 1975, which sets out exceptions to the right to claim discrimination in connection with terms and conditions during maternity leave. The changes enable discrimination claims in relation to terms and conditions during additional leave to the same extent as claims in relation to terms and conditions during ordinary maternity leave. This means that employers must preserve employees' non-pay benefits throughout the full 52-week maternity leave period, rather than just the first 26 weeks. An employee must, therefore, continue to receive contractual benefits such as holiday entitlement, a company car provided for personal as well as business use, a mobile phone, gym membership, mortgage subsidies, participation in share schemes, and health and other insurance for this full period. In addition, employers need to take time spent on additional maternity leave into account when working out entitlement to service-related contractual benefits.
The amendment Regulations also clear up a point regarding bonuses in respect of the period of compulsory leave (the two weeks immediately following the birth, or four weeks for factory workers). The amendment does not change the existing law, as it was established in Lewen v Denda [2000] IRLR 67 that a woman is entitled to the proportion of a discretionary bonus that relates to the time that she was either at work or on compulsory maternity leave.
The Department for Business, Enterprise and Regulatory Reform is to make amendments to the Maternity and Parental Leave etc Regulations 1999 (SI 1999/3312) to take account of the changes to the Sex Discrimination Act 1975 relating to rights during maternity leave. These amendments are expected to come into force in October 2008 and will apply to employees with an expected week of childbirth beginning on or after 5 October 2008.
The rules on pension contributions during maternity leave are governed by social security legislation. A woman on paid maternity leave (26 weeks of ordinary maternity leave and the first 13 weeks of additional maternity leave) is entitled to receive pension contributions from her employer as if she were still at work and receiving full pay (Sch. 5 of the Social Security Act 1989). While the employer's contributions are based on the employee's normal pay, any contributions that she makes are based on the maternity pay that she receives. At present, where an employee is absent on additional maternity leave, this period does not count towards pensionable service. However, as discussed above, for employees with an expected week of childbirth beginning on or after 5 October 2008, it will be discriminatory to exclude the additional maternity leave period from calculating length of service for pension purposes. It is not, however, clear whether or not an employee will be entitled to pension contributions from her employer during her unpaid period of additional maternity leave. It is hoped that the implications of the recent amendments to the Sex Discrimination Act 1975 in relation to pensions will be clarified by the forthcoming amendments to the Maternity and Parental Leave etc Regulations 1999.
Employers should review their maternity policies and, where necessary, remove any differential treatment in contractual benefits during ordinary and additional maternity leave. While the changes to the legislation apply only to employees with an expected week of childbirth beginning on or after 5 October 2008, this will include some employees who are already pregnant, who will need to be informed of their rights. For example, where an employer provides for additional contractual annual holiday, which it will no longer be able to pro-rate to account for time on additional maternity leave, pregnant employees will need to be aware of the effect of this on their holiday entitlement so that they can plan their annual leave around their maternity leave.
This feature was contributed by Katie Wood, a barrister specialising in discrimination law and maternity rights.
