Lauren De Lacey v Wechseln Ltd ta The Andrew Hill Salon: UKEAT/0038/20/VP

This article deals with a recent appeal case called De Lacey v Wechseln Limited trading as the Andrew Hill Hairdressing Salon decided in April 2021. It discusses how an Employment Tribunal should decide if a constructive dismissal is also a discriminatory dismissal. This case involved some potentially discriminatory actions in the past. The original Tribunal had decided it that it did not need to decide whether they were actually discriminatory as they were too long ago to be relied on. There were, however, other more recent events including a ‘final straw’ which, when added to the original incidents, caused the employee to resign and claim constructive dismissal. The Tribunal decided that all the events including the final straw amounted to constructive dismissal. It did not, however, decide whether the earlier potentially discriminatory acts meant that the dismissal was also discriminatory. Thus, it sent the case back to the original Employment Tribunal to make that decision.

The case is useful as it explains how to decide if a dismissal is also discriminatory as opposed to ‘just’ being an ordinary unfair dismissal. The difference is important as discrimination compensation is not subject to a maximum limit and also comes with ‘injury to feeling’ compensation.

Facts

The ex-employee claimed that she had been discriminated against by her hairdresser employer because she was pregnant. She said that there was a sequence of discriminatory events ending with a ‘final straw’ that caused her to resign in 2017. The events she relied on included two in 2015; firstly, that before her employer found out she was pregnant it told her she had done well in a test but after it found out she was pregnant told her she had failed. The second matter was that after it found out she was pregnant she was ‘given the cold shoulder’ at work. Employment tribunals use a two-stage test to decide if any given matter amounts to unlawful discrimination. This test is found in s136 of the Equality Act 2010. A simple explanation is that it is the employee or claimant’s task to prove facts which could amount to discrimination. If they can do that then the company has to prove that whatever was complained of was ‘in no way’ discriminatory. The law in this context describes the primary facts that the claimant proves as being the ‘prima facie’ . That is a Latin phrase meaning ‘at first sight’ but in this context it means ‘accepted as correct until proved otherwise’. There is, therefore, a two-stage process: the employee proves the primary facts on a prima basis facts and the company then has to prove that those facts were ‘in no way’ discriminatory. This involves a very high burden of proof for it to get over.

In this particular case the Employment Tribunal decided that the employee had proved that the two earlier incidents were capable of amounting to discrimination, i.e., that they were prima facie discriminatory. It did not, however, go on to decide whether they were actually discriminatory. This was because they were so long ago that they were well outside the three-month time limit for bringing such a claim. An exception to this rule is if the events complained of were part of a continuing course of conduct extending into the relevant time period. The Tribunal found that they were not part of such a course of conduct and that, therefore, there was no need for it to make any further decision on those events. In making that decision the Tribunal also decided that it was not just and equitable to extend time for a discrimination claim. That question is used to decide whether to allow a claimant to bring a claim relying on out-of-date matters.

The Tribunal also found that the claimant employee had been constructively dismissed because of a course of conduct which included the two matters and which culminated in a “last straw” incident in January 2017. However, the Tribunal did not go on to decide whether the constructive dismissal was itself discriminatory. In order to have done so, the Employment Tribunal should have decided whether the two matters in 2015 were acts of maternity discrimination and, if so, whether they sufficiently influenced the constructive dismissal to mean that the constructive dismissal itself amounted to maternity discrimination. The fact that the last straw was not itself discriminatory did not automatically mean that the constructive dismissal was not discriminatory.

If the constructive dismissal is found to be discriminatory then the claim for discrimination, including two 2015 events would be in time to be considered as part of the constructive dismissal, even though the two 2015 events were out of time for a claim based on those events alone.

Law

The Employment Appeal Tribunal decided that, in principle, a “last straw” constructive dismissal may amount to unlawful discrimination if some of the matters relied upon, though not the last straw itself, are acts of discrimination. It referred to the case of Williams v Governing Body of Alderman Davies Church in Wales Primary School [2020] IRLR 589, which decided that a constructive dismissal should be held to be unlawful discrimination “if it is found that discriminatory conduct materially influenced the conduct that amounted to a repudiatory breach.” It also said that the question was whether the discrimination “sufficiently influenced the overall repudiatory breach” such that the constructive dismissal should be found to be discriminatory.”.

The De Lacey case referred to the passages from Williams above and then said “where there is a range of matters that, taken together, amount to a constructive dismissal, some of which matters consist of discrimination and some of which do not, the question is whether the discriminatory matters sufficiently influenced the overall repudiatory breach so as to render the constructive dismissal discriminatory. In other words, it is a matter of degree whether discriminatory contributing factors render the constructive dismissal discriminatory.

The appeal court in De Lacey said that, as the Employment Tribunal had not decided whether the earlier events sufficiently influenced the overall repudiatory breach, the case should be sent back to the original Tribunal for it to decide that point.

Another point to make about how the Tribunal should approach the question of deciding whether a dismissal is discriminatory is the role of the two-stage burden of proof mentioned above.

The relevant provision in relation to shifting the burden of proof is section 136 of the Equality Act 2010 which says this:

(1) This section applies to any proceedings relating to a contravention of this Act.

(2) If there are facts from which the [employment tribunal] could decide, in the absence of any other explanation, that a person (A) contravened the provision concerned, the court must hold that the contravention occurred.

(3) But subsection (2) does not apply if A shows that A did not contravene the provision.

In a recent case we did, reported in the Times and other newspapers in April 2021, our Client also brought claims of sexual orientation discrimination (section 13 of the Equality Act 2010) and constructive dismissal. The Tribunal in its liability judgement considered the issue of discriminatory constructive dismissal and particularly whether the discriminatory act caused or materially contributed to our Client’s resignation. When considering whether the dismissal was discriminatory it applied the correct test in its reasons - namely the one in the Williams case above although it didn’t quite use those words. However, later in its judgment it referred to s136, the ‘in no way’ test, in connection with its consideration of whether the dismissal was discriminatory. Clearly s136 is relevant to the question of whether any given event or allegation is discriminatory but it can’t be relevant to the question of whether any such event, having been found using s136 to be discriminatory, materially influenced the resulting dismissal. The other side in our recent sexual orientation case had an unsuccessful attempt to appeal that point to the EAT. At the time we did that case neither the Williams or the De Lacey case had been decided but the previous authorities such as Clements v Lloyds Banking PLC & ors [2014] UKEAT/0474/13/JOJ at paragraphs 29-30 and McLeary v One Housing Group [20191 2 WLUK 691, at paragraphs 28-30 were relevant.

Practical matters

The effect of the original Tribunal not making all the decisions it should have done will have been to add vast delay and the significant costs of both the appeal and of dealing with the Tribunal’s new consideration of the dismissal point. It would have been better for all parties for the Tribunal to have decided all the relevant matters in the first place. In this respect careful drafting of the ET1 and of the ‘list of issues’ will be relevant as will the relevant Tribunal representatives spelling out the decisions required by the employment judge. We don’t know whether this happened in the De Lacey case as we weren’t involved. We note that there are four EAT cases mentioned in this article in which the way Employment Tribunals dealt with the question of whether a constructive dismissal was also a discriminatory dismissal was appealed against. That is four sets of legal costs dealing with the same point.

The EAT in this case decided that the claimant employee had claimed, in her ET1, that there had been a discriminatory constructive dismissal. It said, however, that it thought that that particular claim had not perhaps been ‘spelt out as clearly as it might have been in the particulars of claim attached to the claim form’. The appeal court was also critical of the relevant ‘issue’ being described as follows:

“The Claimant relied [for her claim of direct discrimination] on an alleged course of discriminatory and/or unfair treatment culminating in the Respondent’s alleged conduct on 17 January 2017, which the Claimant contended was the final straw.”

In our view the above quote could have been far clearer. The appeal court said of it that although it was “broad enough to encompass both a claim of a discriminatory course of conduct and also a claim that the series of events and incidents, taken together, resulted in a discriminatory constructive dismissal” it could have been clearer.

If you have a similar case to make sure it is clear then ensure that your Employment Tribunal Application form, the ET1, and the ‘list of issues’ deal with both sorts of claim separately. For example,

1. I was subjected to the following conduct which amounted to pregnancy and maternity discrimination contrary to s.18 and s.39(c) EqA 2010. [Then set out the events complained of]. [Then make it clear they amounted to a course of conduct extending over a period].

2. On [DATE] I resigned [[with OR without] notice], in response to the matters complained of in paragraph 1 above. In addition to my claim of direct discrimination under s18 above I believe that the conduct complained of also constituted a fundamental breach of trust and confidence, entitling me to resign with immediate effect. In particular the matters complained of and especially [] were a material factor in my decision to as they were a significant influence on that decision.

Those two paragraphs are not, of course, an entire ET1 but they make it quite clear that that the claimant is making an allegation of direct discrimination and a separate allegation that the constructive dismissal amounted to discrimination.

As with every Employment Tribunal, case management and careful marshalling of the facts are both essential. It is sensible to deal with all points on the agreed list of issues when making a submission at the end of the hearing and even to submit a written submission listing your arguments on each of those points.