An incorporated or unincorporated body may claim compensation for less favourable treatment against it because of the protected characteristics of its members, directors, employees and customers.
In EAD Solicitors LLP v Abrams the Employment Appeal Tribunal President observed:
"In my view, the fact is that the thrust of anti-discrimination legislation is always likely to be focused upon an individual and his or her reaction to the insult that discriminatory treatment gives. However, the question is whether or not others – whether individual or corporate – may have the right to complain that they too have suffered detriment by reason of the way individuals have been treated. It seems to me that there are any number of examples that may be given of treatment which comes within the scope of this question that is plainly contrary to public policy. Examples might be a company being shunned commercially because it is seen to employ a Jewish or ethnic workforce; a company that loses a contract or suffers a detriment because of pursing an avowedly Roman Catholic ethic; one that suffered treatment because of its financial support for the Conservative Party or, say, for Islamic education; or one that was deliberately not favoured because it offered employment opportunities to those who had specific disabilities that were unattractive to some would-be contractors."
The Equality Act 2010 protects "a person" against unlawful discrimination on grounds of a protected characteristic (including age, gender, disability, sexual orientation, race, gender re-assignment, religion or belief).
"Person" is not defined within the 2010 Act and therefore includes "a body of persons corporate or unincorporate" under the Interpretation Act 1978. Ordinarily a person must possess the relevant protected characteristic to be protected and the protection is thereby limited to natural persons. However that limitation does not apply in respect of the protection against direct discrimination (or harassment or victimisation).
Direct discrimination arises where a person treats another person less favourably than they treat others because of a protected characteristic. There is no requirement for the victim to possess the protected characteristic themselves. Accordingly the Equality Act prohibits "associative" discrimination – treating another less favourably because of the protected characteristic of an associated individual.
For an incorporated or unincorporated body, an associated individual may include its members, directors, employees and customers, etc.
Protection against discrimination covers not only employment of workers but also the provision of goods and services and the disposal of property.
Accordingly refusal to supply goods or services to a company because its customers are predominantly transgender, or a refusal to lease a property to a company whose directors are of a particular ethnic origin, may well entitle that company to sue for any losses arising from that refusal.
As regards defending such claims, a company is vicariously liable for the discriminatory conduct of its directors, employees and agents unless it takes all reasonable steps to prevent such conduct. It is therefore vital for a company to implement and monitor an effective equal opportunities policy. It is also important for decision makers to narrate why goods, services or property were not supplied to another company – you might just need to prove that your reasons were not discriminatory.
Disclaimer
The material contained in this article is of the nature of general comment only and does not give advice on any particular matter. Recipients should not act on the basis of the information in this e-update without taking appropriate professional advice upon their own particular circumstances.
