Indirect discrimination costs estate agency

Mrs A. Thompson –v- Scancrown Ltd, trading as Manors

In a case that received widespread media coverage, a former estate agent was awarded £184,961.32 in compensation following finding of indirect discrimination in relation to failure to grant flexible working request

By Michael Nadin – Associate Solicitor, specialising in Employment Law

Mrs Thompson was employed as a Sales Manager by the respondent, an estate agency based in Marylebone.

In May 2018 she announced to her employer that she was pregnant. She was absent on maternity leave from October 2018 to October 2019.

Prior to her maternity leave she was working 5 days per week between 9am and 6pm.  On her return to work following maternity leave, she made an unsuccessful application for flexible working, and lodged a grievance about her treatment when pregnant.

She made the flexible working request because her daughter’s nursery closed at 6pm and she had an hour’s commute to reach it.  She wanted to reduce her working days to 4 and only work until 5pm on her working days to facilitate collection of her child from nursery.

Her flexible working request was denied and her employer did not uphold her grievance.  On learning of these outcomes she resigned on 12^th December 2019.

Shortly after her resignation she issued employment tribunal claims for pregnancy and maternity discrimination, harassment related to sex, indirect sex discrimination in respect of the flexible working request, unfair dismissal, and unlawful deduction of commission payments from wages.

The majority of her claims were dismissed but the claim for indirect sex discrimination was upheld and the tribunal went on to award her almost £185,000 in compensation.

It is worth noting that at the time of writing the claimant has lodged a detailed application for reconsideration of the decision in relation to the findings which went against her.  The outcome of this is not currently known.

Indirect Discrimination

Under section 19 of the Equality Act:

1. A person (A) discriminates against another (B) if A applies to B a provision, criterion or practice (PCP) which is discriminatory in relation to a relevant protected characteristic of B’s.
2. For the purposes of subsection (1), a provision, criterion or practice is discriminatory if
3. A applies, or would apply, it to persons with whom B does not share the characteristic,
4. it puts, or would put, persons with whom B shares the characteristic at a particular disadvantage when compared with persons with whom B does not share it,
5. it puts, or would put, B at that disadvantage, and
6. A cannot show it to be a proportionate means of achieving a legitimate aim.

In this case the PCP was the requirement to work full-time hours of 9am-6pm each day.

Sex is a relevant protected characteristic for indirect discrimination, the claimant relied on the protected characteristic of being a woman.  The tribunal had to consider whether the relevant PCP disadvantaged the claimant because of her sex.

The indirect discrimination claim was in relation the claimant’s unsuccessful request for flexible working,

The tribunal noted that it is not as obvious now, as it was a generation ago, that a requirement to work full-time hours places more women with children at a substantial disadvantage than men with children.

However, in this case the claimant successfully argued that it is still the case. She relies on a report of a 2018 survey carried out on behalf of Direct Line Insurance, headed: “Battle of the sexes – Mums still bearing the brunt of childcare”, reporting that 64% of mothers, compared to 36% of fathers, are the primary carer for their children, despite workplaces increasingly offering flexible working hours, homeworking options, and shared parental leave.

Therefore the tribunal accepted that notwithstanding an encouraging shift in societal attitudes, it is still the case that mothers are more likely to carry primary responsibility than fathers.

The claimant was required to work until 6pm each evening with an hour’s commute each way.  Her child’s nursery closing at 6 pm aligns with standard office hours, and a requirement to work until 6 pm each day did place her at a disadvantage, because she would not be able to get there in time.

The tribunal therefore accepted that the requirement to attend the office at the required times did put her at a disadvantage.

The respondent argued that the PCP was a proportionate means of achieving a legitimate aim.  Namely the success of the business, including the importance of consistency and continuity in client relationships for successful sales.

The tribunal recognised the importance of the sales manager in a small sales team, in a small business with limited options for cover among its other staff.

However, the tribunal found that although it would be difficult for the respondent to cover the claimant’s reduced hours, it was not an insuperable problem.

The tribunal found that the respondent’s staff already worked as a team and other employees could pick up the necessary work created by the claimant reducing her hours.

They found that most customers, clients or patients accept that a named individual may not be immediately available.

The tribunal found that if she had not been indirectly discriminated against (by refusing her request to reduce her hours) then she would have remained in employment.

They therefore found that the loss of earnings she suffered following resignation were as a result of the indirect discrimination.

The claimant struggled to find work after her resignation (not least caused by the Covid-19 pandemic from March 2020).  The tribunal ruled that she would be likely to obtain work at a similar salary by the end of October 2022 and therefore awarded her lost earnings between December 2019 and 31 October 2022.

This made up most of the compensation although she was also awarded the sum of £13,500 for injury to feelings caused by the discriminatory treatment.

The overall amount awarded is very high because the claimant was a well-paid and successful employee prior to her resignation.

Although this is a first instance decision and therefore not binding on other tribunals, employers are still likely to be concerned by an outcome which casts doubt over an employer’s autonomy to act in the best interests of the business when considering flexible working requests.

It remains to be seen whether either party will appeal the Judgment (depending also on how the claimant’s current application to review is decided).

email: michael.nadin@dfalaw.co.uk