Sex Discrimination Act (Amendment) Regulations 2008: An EOR guide

The Sex Discrimination Act 1975 (Amendment) Regulations 2008 (SI 2008, no.656) make important changes to the law relating to harassment and to pregnancy and maternity leave.

On this page:
Harassment
Liability for third-party harassment
Discrimination on the ground of pregnancy or maternity leave
Every dog does not deserve a bite
Box: Employment Bill and Sex Discrimination Regulations conference.

The Sex Discrimination Act has been amended to comply with the findings of the High Court in Equal Opportunities Commission v Secretary of State for Trade and Industry that the amendments to the Act made in 2005 did not correctly implement the revised Equal Treatment Directive. The Regulations change the definition of harassment to make it clear that it does not require a comparison with how a man has been treated and it imposes liability on employers in certain circumstances for harassment of employees by third parties, such as customers and clients. It changes the definition of pregnancy discrimination and removes the distinction as regards non-remuneration benefits between ordinary and additional maternity leave. The Regulations took effect from 6 April 2008.

In the article below, the relevant extracts from the Act as amended by the Regulations are in italics, and the passages repealed, where appropriate, are in square brackets.

Harassment

Two changes are made to the law relating to harassment. The first changes the definition of sex-based or “sex harassment”, as it is now termed, as distinct from “sexual harassment”.

The previous wording referring to unwanted conduct “on the ground of her sex” has been replaced with “unwanted conduct that is related to her sex or that of another person”. The definition now reads:

4A. (1) For the purposes of this Act, a person subjects a woman to harassment if -

(a) he engages in unwanted conduct that is related to her sex or that of another person and [on the ground of her sex, he engages in unwanted conduct that] has the purpose or effect -

(i) of violating her dignity, or

(ii) of creating an intimidating, hostile, degrading, humiliating or offensive environment for her,

(b) he engages in any form of unwanted verbal, non-verbal or physical conduct of a sexual nature that has the purpose or effect -

(i) of violating her dignity, or

(ii) of creating an intimidating, hostile, degrading, humiliating or offensive environment for her…

This amendment thus makes two changes. The first is to replace the term “on the ground of her sex” with “related to her sex”. This language now accords with the revised Directive, which defines harassment in terms of “unwanted conduct related to the sex of a person…” Long-time EOR readers will know that, like many others, we suggested, when the draft Regulations were put out to consultation and when they were adopted, that the wording did not comport with the Directive.

The Government, inexplicably, took the view that there was no difference in meaning between “on the ground of” and “related to”, whereas it seemed obvious that “on the ground of” - the same language used for the test of direct discrimination - required a test of causation and a comparison with how someone of the opposite sex was or would be treated. If a man was treated the same, how can the treatment be “on the ground of” the woman’s sex? In the EOC’s judicial review case , Mr Justice Burton accepted this general argument.

The new test, “related to”, is merely associative. An example given by the Government as to conduct that might be brought within the definition is “where male colleagues dislike a female colleague and decide to put office equipment on a high shelf to make it hard for her to reach”. In such a case, “the former definition may not apply (because the men are acting out of dislike of the woman and not because she is a woman) but the new definition may apply because the conduct of putting equipment on a high shelf relates to sex because women are, on average, shorter than men.”

Note that the change to the definition only relates to unwanted conduct that is not, in itself, conduct of a sexual nature. Sexual conduct is covered by s.4A(1)(b). Section 4A(1)(a) encompasses gender-related conduct, which has the requisite purpose or effect. The example given by the Government in the explanatory memorandum is where “a male manager asks a female colleague to make the tea at every meeting because it is ‘women’s work’.” The impact assessment refers to “disparaging comments about women such as women being useless at driving or mother-in-law jokes which, even if not motivated by the sex of the recipient, are nonetheless related to sex.” This latter point has yet to be picked up by the tabloid press.

The result of the change is that it will no longer be possible for a respondent to avoid a finding of sex-based harassment by showing that persons of the opposite sex were treated in the same or similar manner. This has important implications for bullying, where the offensive conduct is usually better characterised as “related to” the victim’s sex rather than of a “sexual nature”. Thus, if a supervisor makes demeaning comments about women, it will be no defence to show that he also makes demeaning comments of a similar nature about men. The same considerations now apply to the use of foul or obscene language. Of course, much of this was already covered, but the new change makes it clear beyond doubt that the prohibition against sex-based harassment is indeed freestanding, as required by the European Directive.

The second change to this definition specifies that the unwanted conduct related to sex does not have to relate to the sex of the claimant but can relate to the sex of another person, such as when someone witnesses harassment. A woman, for example, might find the constant humiliation of a female colleague has led to a degrading working environment for herself as well as for her colleague. This change means that she will have an independent cause of action regardless of whether her colleague brings a claim. Or she may be offended by a workplace in which sexist banter is prevalent. Similarly, a man might bring a claim in respect of the effect on his working environment as a result of witnessing harassment of a female colleague.

The amended definition will apply also to the prohibition of sex harassment in the exercise of public functions and the duty to promote gender equality.

Liability for third-party harassment

Undoubtedly the most far-reaching change made by the Amendment Regulations is to impose liability on employers in certain circumstances for failing to protect their employees from third-party harassment. Section 6(2A) of the Act provides that it is unlawful for an employer to subject to harassment a woman whom he employs or a woman who has applied to him for employment. The Regulations add a new s.6(2B) as follows:

“(2B) For the purposes of subsection (2A), the circumstances in which an employer is to be treated as subjecting a woman to harassment shall include those where -

(a) a third party subjects the woman to harassment in the course of her employment, and

(b) the employer has failed to take such steps as would have been reasonably practicable to prevent the third party from doing so.

(2C) Subsection (2B) does not apply unless the employer knows that the woman has been subject to harassment in the course of her employment on at least two other occasions by a third party.

(2D) In subsections (2B) and (2C), “third party” means a person other than -

(a) the employer, or

(b) a person whom the employer employs,

and for the purposes of those subsections it is immaterial whether the third party is the same or a different person on each occasion.”

The new section is a deeming provision, in that it deems the woman’s employer liable for harassment by a third party. The general principle is that employers will be obliged to stop repetitive harassment by third parties. Before a claim can be made successfully, however, a number of conditions will have to be met:

• the woman will have to have experienced harassment falling within the statutory definition;
• the harassment to which the woman was subjected must have taken place during the course of her employment;
• it will have to be shown that the employer failed to take reasonably practicable steps to prevent the harassment;
• there must have been two previous incidents of harassment meeting the statutory requirement and of which the employer knew, although the harassment does not have to have been carried out by the same third party on each occasion.

Looking at these ingredients individually, first of all the harassment must be sexual or sex harassment within the meaning of the definition set out above. In addition, the requirement of s.4A(2) will have to be satisfied. This provides that, where it is being alleged that the conduct in question had the effect, rather than the purpose, of violating dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment for the employee, then it will only be treated as having that effect if, having regard to all the circumstances, including the claimant’s perception, “it should reasonably be considered as having that effect”.

The requirement that the harassment took place in the course of the woman’s employment sets a limit on harassment that will be actionable if it takes place at social events outside of work, even if it involves clients or customers.

In order for the employer to be liable, a tribunal will have to find that the employer failed to take such steps as would have been reasonably practicable to prevent the third party from harassing the woman in the course of her employment. That requires a finding both that there were reasonably practicable steps to prevent the harassment from taking place, and that the employer failed to take those steps.

Finally, and most controversially, there will be no employer liability for placing an employee in a situation in which they are sexually harassed by a third party unless the employer knows that the employee has been harassed by a third party on at least two other occasions (see below ). Thus, an employer is not liable for third-party harassment of which they had no knowledge, or for one-off incidents of third-party harassment, or for conduct beyond their control.

Note that the formulation “on grounds of”, now removed from the Sex Discrimination Act in order to comply with EU law, is still found in the Race Relations Act, the Religion or Belief Regulations, the Sexual Orientation Regulations and the Age Regulations (although not the Disability Discrimination Act), all of which are subject to European Directives. The Government implemented the changes to the Sex Discrimination Act under s.2 of the European Communities Act, and evidently decided not to use that to make changes to the harassment provisions in respect of the other strands. Similarly with regard to third-party harassment. Presumably, this anomaly will now be left to the Single Equality Bill to tidy up.

Discrimination on the ground of pregnancy or maternity leave

The High Court held that s.3A(1) of the Sex Discrimination Act as amended, which provided that a person discriminates against a woman if “on the ground of the woman’s pregnancy, the person treats her less favourably than he would treat her had she not become pregnant”, impermissibly introduced a requirement for a non-pregnant female comparator for the purpose of establishing discrimination on grounds of pregnancy.

The amendment recasts the section so as to eliminate the statutory requirement for a comparator who is not pregnant or who is not on maternity leave. Section 3A(1) now provides that a person discriminates against a woman if -

“(a) on the ground of the woman’s pregnancy, the person treats her less favourably; or

 (b) 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.”

Ever since the 1994 decision of the European Court of Justice in Webb v EMO Air Cargo (UK) Ltd , it has been clear law that it is not necessary for a pregnant woman to compare her treatment to that of a man in order to establish pregnancy discrimination. The revised Equal Treatment Directive provides that “less favourable treatment of a woman related to pregnancy or maternity leave … shall constitute discrimination within the meaning of this Directive.”

The Government implemented this in 2005 by providing, for the first time, a freestanding right not to be discriminated against on grounds of pregnancy or maternity, but defining that by reference to how the woman would have been treated had she not been pregnant. Presumably, the Government’s reasoning was that a comparison is inherent in the concept of “less favourable treatment”. The language of the statute now accurately reflects the language of the Directive, but it leaves unanswered the question: “Less favourable than what?”

The examples given in the explanatory memorandum are “a woman whose employer refuses to let her take additional toilet breaks while pregnant” and “a women whose job requires heavy lifting which she cannot perform while pregnant but who is nonetheless required to do so.”

It may be that this concept is more accurately expressed as “unfavourable” treatment related to pregnancy or maternity, rather than “less favourable” treatment. That is the term used in recital 12 to the Directive, though not in the Directive itself.

Exception relating to terms and conditions during maternity leave

In accordance with the ruling of the High Court, changes have been made to the wording of the provisions relating to discrimination in respect of terms and conditions during maternity leave. The new s.6A reads as follows:

“6A. - (1) Subject to subsection (2), section 6(1)(b) and (2) does not make it unlawful to deprive a woman who is on maternity leave of any benefit from the terms and conditions of her employment relating to remuneration.

(2) The reference in subsection (1) to benefit from the terms and conditions of a woman’s employment relating to remuneration does not include a reference to –

(a) maternity-related remuneration (including maternity-related remuneration that is increase-related),

(b) remuneration (including increase-related remuneration) in respect of times when the woman is not on maternity leave, or

(c) remuneration by way of bonus in respect of times when a woman is on compulsory maternity leave.

(3) For the purposes of subsection (2), remuneration is increase-related so far as it falls to be calculated by reference to increases in remuneration that the woman would have received had she not been on maternity leave.

(4) In this section –

“maternity-related remuneration”, in relation to a woman, means remuneration to which she is entitled as a result of being pregnant or being on maternity leave;

“on compulsory maternity leave” means absent from work in consequence of the prohibition in section 72(1) of the Employment Rights Act 1996;

“on maternity leave” means –

(a) on compulsory maternity leave,

(b) absent from work in exercise of the right conferred by section 71(1) of the Employment Rights Act 1996 (ordinary maternity leave), or

(c) absent from work in exercise of the right conferred by section 73(1) of that Act (additional maternity leave); and

“remuneration” means benefits –

(a) that consist of the payment of money to an employee by way of wages or salary, and

(b) that are not benefits whose provision is regulated by the employee’s contract of employment.”

The main change that has been made is to remove the former s.6A(3), which substantially limited claims for discrimination that could be brought in respect of the additional maternity leave period by providing that (subject to exceptions), it was not “unlawful to deprive a woman who is on additional maternity leave of any benefit from the terms and conditions of her employment”. Removal of this provision was held by the High Court to be necessary to comply with the judgment of the European Court of Justice in Land Brandenburg v Sass , which questioned the distinction between ordinary statutory maternity leave and additional statutory maternity leave.

Accordingly, the new provisions eliminate any distinction in the types of claim a woman can bring in relation to the periods of ordinary and additional maternity leave. As the explanatory memorandum points out, “this means that a woman may have a claim if she is not afforded the same benefits of the terms and conditions of employment during additional maternity leave as she is during ordinary maternity leave.” The change will have an impact on those employers who provide non-pay benefits to women on ordinary maternity leave, but not during additional maternity leave, such as contractual annual leave above the statutory minimum, company cars, gym membership and mobile phones. It also will mean that the period of additional maternity leave will have to be taken into account in calculating length of service for the purposes of assessing seniority or financial non-contractual benefits.

The change to the provisions relating to the two-week period of compulsory maternity leave makes clear that for the purposes of calculating a discretionary bonus, any period spent on compulsory maternity leave must be included as though the employee had been at work and working normally. This is in accordance with the decision of the European Court of Justice in Lewen v Denda .

These changes will apply to women whose expected week of childbirth begins on or after 5 October 2008. The Maternity and Parental Leave etc Regulations 1999, which govern the benefits afforded during maternity leave, will be amended in order to remove the distinction between ordinary and additional maternity leave in respect of entitlement to non-pay benefits.

Every dog does not deserve a bite

It is difficult to fathom the rationale for the rule in the amended Sex Discrimination Act that a woman who has been sexually harassed during her work by a customer, client or supplier cannot sue her employer for putting her in that position, unless the employer knows that she has been harassed by a third party at least twice before.

Given all the other ingredients that have to be satisfied before liability is imposed, the appropriate distinction, it might have been thought, is between cases where the employer ought reasonably to have known that the employee was likely to be subjected to harassment and situations where it was not reasonably foreseeable.

Instead, the amended Act may provide no remedy at all where the employer knows that the third party is a harasser because it has had complaints from other employees – the customer who is a serial groper, for example – and nevertheless places a woman in a position where she is subjected to sexual harassment which creates a humiliating working environment for her. In such a case, the employer can escape liability on the technicality that the woman herself has not been subjected to harassment by a third party on two other occasions. Thus, the new legislation does not change the law in a “Bernard Manning-type” situation. The waitresses in that case would not have a remedy unless they had been subjected to third-party harassment on previous occasions.

Nor does there seem to be any justification for the “three strikes and you’re out” rule. One can see the argument for not making an employer liable on the first occasion that the employee is harassed by a third party, although even that is problematic given the onus on the claimant, in any event, to show that the employer has failed to take reasonably practicable steps to prevent the harassment. But how could it possibly be appropriate for the law, in effect, to say to a woman who has told their employer that they have been subjected to harassment by a particular individual that they have no remedy even if it is repeated again, and that they have to wait for a third occasion in order to be able to use the Sex Discrimination Act?

Conversely, there are also problems with the statutory drafting from an employer’s perspective. Even though an employer may not be liable for the first two acts of third-party harassment, it would seem prudent for the employer to investigate them so as to establish whether the incident in question met all the ingredients of the statutory definition. A perfunctory attitude to the first complaints might mean that trivial incidents are treated as counting. There is no time limit either on the period within which the three incidents have to have occurred.

Finally, as regards the first occasions on which an employee is subjected to third-party harassment, even if the employer cannot be made liable under the harassment provisions as such, it seems inevitable that cases will be brought against employers in respect of how they handled their employee’s grievance complaining that they were harassed by a third party.

Box: Employment Bill and Sex Discrimination Regulations conference The Sex Discrimination (Amendment) Regulations will be explored at a Butterworths conference on Friday 20 June in Central London. Michael Rubenstein will be speaking on the harassment provisions and Joanna Wade will be speaking on the changes to pregnancy and maternity rights. The day will also cover the Government’s Employment Bill, with sessions from John McMullen on the repeal of the statutory dismissals and grievance procedures, James Davies on the new Acas Code of Practice on disciplinary and grievance procedures, and Paul Statham on the new provisions on trade union membership. Peter Schofield and Georgina Hirsch will provide an employer and trade union perspective. For further details, tel: 020 7347 3573 or email.