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||Neutral Citation Number:  EWCA Civ 1913
||Case No: A2/2014/2795
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
HHJ PETER CLARK
||Royal Courts of Justice
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE DAVIS
LORD JUSTICE BEATSON
LORD JUSTICE SINGH
|| Ajayi Ayodele
||- v -
||(1) Citylink Limited
(2) Paul Napier
Mr Ronnie Dennis (instructed by The Bar Pro Bono Unit with the support of Curling Moore Solicitors) for the Appellant
The Respondents did not appear and were not represented
Hearing date: 25 October 2017
HTML VERSION OF JUDGMENT APPROVED
Crown Copyright ©
Lord Justice Singh :
- This is an appeal against the order made by the Employment Appeal Tribunal ("EAT") dated 1 August 2014, by which the Appellant's application for reconsideration under rule 3(10) of the Employment Appeal Tribunal Rules 1993 (as amended) was refused. By that order HHJ Peter Clark directed that no further action should be taken on the appeal and the appeal was thereby dismissed.
- The decision of the Employment Tribunal ("ET") sitting at Cardiff was sent to the parties on 29 October 2013. By that decision, so far as material, the ET had dismissed the Appellant's claim for racial discrimination.
- Permission to appeal to this Court was granted by Bean LJ, after a hearing on 15 July 2015, in an order sealed on 23 July 2015. Permission was granted on one ground only, then numbered Ground 6, to which I will refer as the first ground of appeal.
- In addition the Appellant seeks to rely on a new point which has arisen as a consequence of the decision of the EAT in another case since the time when permission was granted: Efobi v Royal Mail Group Limited (UKEAT/0203/16, 10 August 2017), a decision by Elisabeth Laing J. This point was raised in a supplementary skeleton argument on the Appellant's behalf and, at the hearing of this appeal, we granted permission for it to be raised. I will refer to this as the Appellant's second ground of appeal.
- The First Respondent has gone into administration. Neither Respondent has chosen to take an active part in the present appeal. We have therefore not had the benefit of submissions on their behalf. We have been assisted by the written and oral submissions of Mr Ronnie Dennis, who has appeared pro bono on behalf of the Appellant and to whom we are grateful.
- The factual background can be taken from the summary given by the ET at paras. 4-5 of its judgment.
- The Appellant is originally from Nigeria and describes himself as black. The Appellant's employment came to an end in October 2012. The details of the circumstances in which it came to an end are set out in paras. 14-15 of the ET judgment.
- The First Respondent is a logistics organisation which delivers letters, packets and parcels. The Appellant was employed to work at the distribution depot in Swansea as a warehouse operative. He commenced his employment initially as an agency worker but became directly employed by the First Respondent during 2007.
- The Second Respondent was the Appellant's team manager, although a Mr Birch was his day-to-day supervisor.
- In October 2012 the Appellant resigned. He submitted that this was in response to a repudiatory breach of his contract of employment by the First Respondent. He therefore claimed that he had been constructively dismissed.
- On 2 November 2012 a Mr Ford wrote to the Appellant on behalf of the First Respondent accepting his resignation and confirming 12 October as his last day of employment.
- Before the ET the Appellant raised a number of different types of claim: racial discrimination, racial harassment, victimisation and unfair dismissal.
- Because some of the Appellant's complaints went back many years going back to the time when he commenced employment in 2007, the case straddled the date when the Equality Act 2010 came into force (for most purposes 1 October 2010). It was therefore necessary for the ET to consider both that Act and its predecessor for relevant purposes, the Race Relations Act 1976.
The Judgment of the Employment Tribunal
- After setting out its summary of the Appellant's claims and its findings of fact, the ET set out its understanding of the relevant law at paras. 17-39 of its judgment.
- In particular it set out material provisions of the Equality Act, including section 136 at para. 23 of its judgment. It also set out material provisions of the Race Relations Act, including section 54A at para. 24 of its judgment.
- The ET also set out its understanding of relevant case law.
- At para. 27 of its judgment the ET said:
"The Tribunal has sought to remind itself of the statutory reversal of the burden of proof in discrimination cases. We consider the reasoning in the cases of Igen Limited v Wong  IRLR 258; Barton v Investec Henderson Crosthwaite Securities Limited  IRLR 332 and Madarassy v Nomura International plc  IRLR 246. Where it was demonstrated that the Employment Tribunal should go through a two-stage process, the first stage of which requires the Claimant to prove facts which could establish that the Respondent has committed an act of discrimination, after which, and only if the Claimant has proved such facts, the Respondent is required to establish on the balance of probabilities that it did not commit the unlawful act of discrimination. The Madarassy case also makes it clear that in coming to the conclusion as to whether the Claimant had established a prima facie case, the Tribunal is to examine all the evidence provided by the Respondent and the Claimant." (Emphasis added)
- Mr Dennis submits that the ET fell into error in that passage. This is because it directed itself that it had to examine all the evidence, including that provided by the Respondent, even at the first stage of the analysis. I will return to that submission in considering the Appellant's first ground of appeal.
- Under its heading "Analysis" the ET said, at para. 40 of its judgment:
"The Tribunal examined the facts of each of the separate complaint[s] in the Claimant's claim individually. However, we also considered the accumulation of evidence in order to draw conclusions as to whether there was an underlying motivation for actions on the part of the Respondent. We consider that given the significant information about the culture in the organisation, the failure to deal with the Claimant's 2010 complaint, the problems in applying procedure are matters of concern. However because of the overall findings about the universality of this treatment towards staff we have not found that the Claimant has established prima facie evidence of less favourable treatment and therefore do not consider that the burden of proof has shifted to the Respondent."
- Mr Dennis submits that the last sentence in that passage betrays two errors of law by the ET. He submits, under his first ground of appeal, that the ET impermissibly had regard to evidence produced by the Respondent at the first stage of the analysis; and, secondly, that the ET misdirected itself that there was a burden on the Appellant at the first stage to show that there was a prima facie case of discrimination.
- The ET then proceeded to consider each of what amounted to eight separate complaints at paras. 41-48 of its judgment. It found none of the claims was well founded and so dismissed the claim.
- The Appellant applied for reconsideration of the judgment on 11 November 2013. That application was refused by the ET on 12 January 2014. The ET was of the view that the matters raised by the Claimant should all be dealt with by way of appeal and not reconsideration.
The Judgment of the Employment Appeal Tribunal
- In accordance with normal practice the appeal to the EAT was initially considered on a "paper sift" and rejected by Lady Stacey under rule 3(7) of the EAT Rules, for the reasons set out in a letter of 1 May 2014. As was his right the Appellant then applied for reconsideration of that decision at an oral hearing under rule 3(10). That came before HHJ Peter Clark on 1 August 2014 and was refused. Accordingly the appeal stood as being dismissed.
- Judge Clark was of the view that this was a case which had been decided on its own facts and the appeal had absolutely no prospect of success whatsoever: see para.10 of his judgment. He also took the view that in essence the appeal was based on the ground of perversity. He was wholly unpersuaded that the perversity threshold had been reached: see para. 8. In the same paragraph Judge Clark said that the Tribunal had dealt with each of the complaints in some detail in their factual findings and in their analysis but they were conscious of the principle in Anya v Oxford University  ICR 847, a decision of the Court of Appeal, and looked at the accumulation of evidence. Having done so, continued Judge Clark, the ET was not persuaded that a prima facie case of discrimination had been made out.
- At para. 6 Judge Clark said:
"… They [the ET] concluded that the Claimant had failed to make out a prima facie case, shifting the burden of explanation to the Respondents. They found there was no less favourable treatment of the Claimant. In addition, some of his claims were time-barred. Further, the Tribunal found no repudiatory breach by the First Respondent entitling the Claimant to treat himself as constructively dismissed and, if there was, he waived any breach."
The Grounds of Appeal
- The only ground of appeal on which permission was granted by Bean LJ was set out in what was then numbered Ground 6 but which, as I have said, I will refer as the Appellant's first ground. As that ground was originally formulated, it was submitted that the ET erred in law when, despite making findings of unwanted treatment and conduct against the Respondents, it held, at para. 40 of its judgment, that, because of the overall findings about the universality of this treatment towards staff, the Appellant had not established prima facie evidence of less favourable treatment and therefore the burden of proof had not shifted to the Respondents.
- In particular Mr Dennis submits that the ET wrongly took account of the Respondents' explanations at the first stage of the analysis despite the express language of the relevant legislation and copious authority to the effect that that is impermissible.
- Further, in his supplementary skeleton argument, Mr Dennis submits that there was a fundamental error in the approach taken by the ET as to the proper application of section 136 of the Equality Act. He makes that submission in the light of the recent judgment of Elisabeth Laing J in the EAT in Efobi. In reliance on that decision Mr Dennis submits that section 136(2) does not in fact put any burden on a claimant before the ET. It requires the ET to consider all the evidence, from all sources, at the end of the hearing, so as to decide whether or not there are "facts" from which the ET could find discrimination and, if so, it must so find unless the respondent can discharge the burden on it. As I have mentioned, I will treat this new point as a second ground of appeal.
- In consequence, submits Mr Dennis, this appeal should be allowed on either or both of the grounds that he now advances and the claim remitted to a differently constituted ET.
- Section 54A of the Race Relations Act 1976 was introduced by amendment in 2003. That amending legislation gave effect in domestic law to requirements of European Union ("EU") law that were first introduced in the Burden of Proof Directive, Council Directive 97/80/EC, Article 4; and, of particular relevance in the present context, in the Racial Equality Directive, 2000/43/EC, Article 8. Article 8.1 provides:
"Member States shall take such measures as are necessary, in accordance with their national judicial systems, to ensure that, when persons who consider themselves wronged because the principle of equal treatment has not been applied to them establish, before a court or other competent authority, facts from which it may be presumed that there has been direct or indirect discrimination, it shall be for the respondent to prove that there has been no breach of the principle of equal treatment."
- Article 8.2 makes it clear that Member States may voluntarily go further than this minimum requirement.
- Section 54A, so far as material, provided:
"(2) Where, on the hearing of the complaint, the complainant proves facts from which the tribunal could, apart from this section, conclude in the absence of an adequate explanation that the respondent –
(a) has committed such an act of discrimination or harassment against the complainant … the tribunal shall uphold the complaint unless the respondent proves that he did not commit or, as the case may be, is not to be treated as having committed, that act."
- Section 136 of the Equality Act 2010, so far as material, provides:
"(2) If there are facts from which the court 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 provisions."
- As I have mentioned, the origins of the material legislation lie in EU law. The Opinion of Advocate General Mengozzi in Case C-415/10 Galina Meister v Speech Design Carrier Systems GmbH, delivered on 12 January 2012, ECLI:EU:C:2012:8, at para. 22, supports the view that in EU law the initial burden lies on a claimant and that this maintains a fair balance between the rights of claimants and those of defendants or respondents:
"It is also apparent from the overall scheme of those provisions that the choice made by the legislature was clearly that of maintaining a balance between the victim of discrimination and the employer, when the latter is the source of the discrimination. Indeed, with regard to the burden of proof, those three directives opted for a mechanism making it possible to lighten, though not remove, that burden on the victim. In other words, as the Court has already held in its judgment in Kelly … the mechanism consists of two stages. First of all, the victim must sufficiently establish the facts from which it may be presumed that there has been discrimination. In other words, the victim must establish a prima facie case of discrimination. Next, if that presumption is established, the burden of proof thereafter lies on the defendant. Central to the provisions referred to in the first question referred for a preliminary ruling is therefore the burden of proof that, although somewhat reduced, nevertheless falls on the victim. A measure of balance is therefore maintained, enabling the victim to claim his right to equal treatment but preventing proceedings from being brought against the defendant solely on the basis of the victim's assertions."
- The decision of the Court of Justice of the EU in that case follows a similar approach, but the reasoning is limited and focuses on the similarity between the 'Recast Gender Directive' and earlier Directives: Judgment of the Court (Second Chamber), 19 April 2012, ECLI:EU:C:2012:217.
- In Igen Ltd v Wong  ICR 931 this Court considered the effect of the amendments to the various discrimination statutes that had been made in relation to the burden of proof, including section 54A of the Race Relations Act. The lead judgment in this Court was given by Peter Gibson LJ. At para. 22 he accepted the submission made by counsel on behalf of the employee in that case and said:
"The words 'in the absence of an adequate explanation', followed by 'could', indicate that the ET is required to make an assumption at the first stage which may be contrary to reality, the plain purpose being to shift the burden of proof at the second stage so that, unless the respondent provides an adequate explanation, the complainant will succeed. It would be inconsistent with that assumption to take account of an adequate explanation by the respondent at the first stage. …"
- In the well-known guidance which was annexed to the judgment of this Court it was stated in para. (6):
"In considering what inferences or conclusions can be drawn from the primary facts, the tribunal must assume that there is no adequate explanation for those facts."
- In the present case Mr Dennis relies on those familiar passages in support of the Appellant's first ground of appeal.
- However, it should be noted that, in Laing v Manchester City Council  ICR 1519, the EAT made it clear that there is an important distinction in this context between "facts" and "explanation". The judgment was given by Elias J (President), sitting with lay members. At para. 51 Elias J said:
"We note in particular three features of this section [section 54A of the Race Relations Act]. First, the onus is on the complainant to prove facts from which a finding of discrimination, absent an explanation, could be found. Second, by contrast, once the complainant lays that factual foundation, the burden shifts to the employer to give an explanation. The latter suggests that the employer must seek to rebut the inference of discrimination by showing why he has acted as he has. That explanation must be adequate, which as the courts have frequently had cause to say does not mean that it should be reasonable or sensible but simply that it must be sufficient to satisfy the tribunal that the reason had nothing to do with race: see Glasgow City Council v Zafar  ICR 120 and Bahl v The Law Society  IRLR 799." (Emphasis in original)
- In para. 54 Elias J referred to what Peter Gibson LJ had said in the Igen case.
- In Laing itself there was evidence adduced by the employer that the relevant person had indiscriminately treated all subordinates in an abrupt fashion. Counsel for the employee made the submission that that evidence should not have been taken into account by the ET at the first stage of the Igen analysis. This was because it was neither part of the evidence adduced by the claimant nor evidence adduced by the employer which assisted the claimant's case. It was argued therefore that this evidence was irrelevant to whether or not there was a prima facie case: see para. 57 of the judgment. In contrast counsel for the respondents submitted that the ET should have regard to all the facts at the first stage to see what proper inferences can be drawn and that the treatment of others was plainly a highly material fact: see para. 58. The EAT agreed with that submission for the respondents for a number of reasons, which are set out at para. 59:
"… First, we think that their argument is strongly supported by paragraphs (4) and (5) of the annex [the guidance in Igen] … These paragraphs focus on all the primary facts before the tribunal. In our view the reference to 'the complainant proves facts' in section 54A(2) does not mean that it is only the facts adduced by him (plus supporting facts adduced by the respondent) that can be considered; it is merely indicating that at that stage the burden rests on the complainant to satisfy the tribunal, after a consideration of all the facts, that a prima facie case exists sufficient to require an explanation."
- At para. 60 Elias J said:
"Second, the obligation for the employer to provide an explanation once the prima facie case has been established, strongly suggests that he is expected to provide a reason for the treatment. An explanation is just that; the employer must explain. Why has he done what could be considered to be a racially discriminatory act? It is not the language one would expect to describe facts that he may have adduced to counter or to put into context the evidence adduced by the claimant." (Emphasis in original)
- At para. 62 Elias J observed that there may well be evidence which should not properly be described as an explanation for the treatment:
"Rather it is merely factual evidence presenting a fuller picture of the material facts and putting the facts adduced by the employee in context, and thereby demonstrating that there is nothing about the circumstances to justify an inference of race discrimination …"
- At para. 63 Elias J gave as a third reason for his view:
"Third, Mr Leiper's approach would be requiring tribunals to adopt mental gymnastics. They will of course have heard all the evidence; they are then being asked to differentiate between the evidential source of different facts and artificially to pretend at stage one that they are not aware of those adduced by the employer. To leave out of account the explanation, as they are required to do, is itself artificial, although the distinction between fact and explanation is at least usually tolerably clear. But this approach would significantly and artificially complicate the fundamentally simple question of asking why the employer acted as he did."
- At para. 64 Elias J noted that there may be case in which the tribunal, having heard all the evidence, may be wholly convinced that the treatment relied upon simply did not occur. He went on:
"It is absurd to say that the employer is providing an explanation for the treatment when it did not even take place; he is simply adducing facts to dispute the evidence of the employee. It is plainly unjust to place the onus on the employer to show that the comments were not made and to prove that the employee is lying. It is for the employee to prove that he suffered the treatment, not merely to assert it, and this must be done to the satisfaction of the tribunal after all the evidence has been considered. Matters of credibility in particular can only be assessed in the light of all the evidence, and it cannot be right to require the employer to prove – let alone, in the language of the section to 'explain' – that the employee is lying." (Emphasis in original)
- At para. 65 Elias J said:
"In our view, if one considers the burden of proof provision in the context of what a claimant needs to establish in a discrimination claim, what it envisages is that the onus lies on the employee to show potentially less favourable treatment from which an inference of discrimination could properly be drawn. Typically this will involve identifying an actual comparator treated differently or, in the absence of such a comparator, a hypothetical one who would have been treated more favourably. That involves a consideration of all material facts (as opposed to any explanation)."
- At para. 66 he said:
"It is only if the claimant succeeds in establishing that less favourable treatment that the onus switches to the employer to show an adequate, in the sense of non-discriminatory, reason for the difference in treatment. That requires a consideration of the subjective reasons which cause the employer to act as he did: see Shamoon v Chief Constable of the Royal Ulster Constabulary  ICR 337, 341, para. 7, per Lord Nicholls of Birkenhead."
- Realistically, however, Elias J recognised at para. 68:
"That is not to say that fact and explanation are hermetically sealed compartments. There is plainly a relationship between them. … Facts are not unrelated to the explanation, although they are not to be confused with it."
- Finally, at para.76 Elias J rightly observed that ETs "are not answering an examination question, and nor should the purpose of the law be to set hurdles designed to trip them up. …"
- Laing was approved by this Court in Madarassy, in which the lead judgment was given by Mummery LJ. At para. 79 he described the approach of Elias J in Laing as "sound in principle and workable in practice. This Court should approve it."
- At para.70 Mummery LJ said:
"Although no doubt logical, there is an area of unreality about all of this. From a practical point of view it should be noted that, although section 63A(2) [of the Sex Discrimination Act 1975, as amended] involves a two-stage analysis of the evidence, the tribunal does not in practice hear the evidence and the argument in two stages. The Employment Tribunal will have heard all the evidence in the case before it embarks on the two-stage analysis in order to decide, first, whether the burden of proof has moved to the respondent and, if so, secondly, whether the respondent has discharged the burden of proof."
- At para. 71 he continued:
"Section 63A(2) does not expressly or impliedly prevent the tribunal at the first stage from hearing, accepting or drawing inferences from evidence adduced by the respondent disputing and rebutting the complainant's evidence of discrimination. The respondent may adduce evidence at the first stage to show that the acts which are alleged to be discriminatory never happened; or that, if they did, they were not less favourable treatment of the complainant; or that the comparators chosen by the complainant or the situations with which comparisons are made are not truly like the complainant or the situation of the complainant; or that, even if there has been less favourable treatment of the complainant, it was not on the ground of her sex or pregnancy." (Emphasis added)
- At para. 72 Mummery LJ continued:
"Such evidence from the respondent could, if accepted by the tribunal, be relevant as showing that, contrary to the complainant's allegation of discrimination, there is nothing in the evidence from which the tribunal could properly infer a prima facie case of discrimination on the proscribed ground. As Elias J observed in Laing … para. 64, it would be absurd if the burden of proof moved to the respondent to provide an adequate explanation for treatment which, on the tribunal's assessment of the evidence, had not taken place at all."
- The approach of this Court in cases such as Igen was approved by the Supreme Court in Hewage v Grampian Health Board  ICR 1054: see in particular para. 25 (Lord Hope DPSC).
- In Efobi Elisabeth Laing J held in the EAT that section 136(2) does not place any burden on a claimant to prove anything: see para. 78 of her judgment. She considered it to be significant that Parliament has used different language in enacting section 136 of the Equality Act compared to the predecessor provisions such as section 54A of the Race Relations Act and its "sibling" provisions in section 63A of the Sex Discrimination Act 1975 and section 17A of the Disability Discrimination Act 1995. She acknowledged that the side-note to section 136 is "burden of proof". She also acknowledged, at para. 79, that this is not the way in which section 136 is interpreted in the Explanatory Notes. However, she said that those notes cannot be treated as reflecting the will of Parliament, which is to be deduced from the language of the statute in question: see Westminster City Council v NASS  1 WLR 2956, paras. 5-6 (Lord Steyn).
- Elisabeth Laing J also acknowledged two further points. First, this is not the way in which the burden of proof has been understood in the cases starting with Igen. However, she said the statutory provision considered by this Court in Igen was not section 136. Secondly, she accepted that her interpretation of section 136 would go further than Article 8.1 of Directive 2000/43 requires. However, she noted that Article 8.2 expressly permits Member States to introduce rules of evidence which are more favourable to claimants: see para. 82 of her judgment.
- At para. 78 she said:
"… Section 136 prohibits a submission of no case to answer because it requires the ET to consider all the evidence, not just the claimant's, and because it is explicit in not placing any initial burden on the claimant. The word 'facts' in section 136(2) rather than 'evidence' shows, in my judgment, that Parliament requires the ET to apply section 136 at the end of the hearing, when making its findings of fact. It may therefore be misleading to refer to a shifting of the burden of proof, as this implies, contrary to the language of section 136(2), that Parliament has required a claimant to prove something. It does not appear to me that it has done."
- At para. 86 Elisabeth Laing J said:
"… At the first stage of the analysis required by section 136, there is no burden on a claimant to prove anything (although if this case is manifestly frivolous, a respondent can apply to have it struck out). What the ET has to do is to look at the 'facts' as a whole. …"
- It should be noted that, even if that interpretation of section 136 were wrong and it is to be interpreted in the same way as its predecessor "sibling provisions", as imposing an initial burden of proof on a claimant, Elisabeth Laing J would still have allowed the appeal in the particular circumstances of that case: see para. 94 of her judgment.
The First Ground of Appeal
- Before I address the merits of the first ground appeal in detail I must make two preliminary observations.
- The first is that, as I have already mentioned by reference to the authorities, it is important not to treat the judgment of the ET as if it were sitting an examination paper. Rather the judgment must be read fairly and as a whole, not for example taking one or two phrases in isolation.
- The second observation is that, again as the authorities demonstrate, there may be cases in which there are at least the following three issues which arise in respect of any specific complaint of discrimination:
(1) Did the alleged act occur at all?
(2) If it did occur, did it amount to less favourable treatment of the claimant when compared with others?
(3) If there was less favourable treatment, what was the reason for it? In particular, was that reason discriminatory?
- Accordingly, there may be cases in which the tribunal never has to address question (3), because it is not satisfied that it has been proved on the evidence that the alleged act took place at all; or it may not be satisfied that there was less favourable treatment.
- In the present case, it is clear from the judgment of the ET when read as a whole that the ET came to the conclusion "that there was a culture operating in the respondent's depot in Swansea" which had various unattractive aspects: see para. 6. For example there was "a managerial approach that took informality almost [to] an art form and in addition to this was one where mistakes made in managing payroll, holidays and staff were tolerated": see para. 6.2. The ET was of the view that the "hallmarks of this case point to very poor management on the part of the respondent at its junior and mid-managerial levels": see para. 6.3.
- In addressing each of the eight specific complaints which were made by the Appellant before the ET, it is necessary to look both at the passages in the section of the judgment on "Analysis", which begins at para. 40, and the corresponding passages in the factual findings, which begin at para. 4.
- The first complaint was based on the second Respondent's refusing to call the Appellant by name and that he would not speak politely to the Appellant as he would speak to others. The ET was of the view that the Appellant had demonstrated that he would on occasion be beckoned by the second Respondent. It did not consider that he had established that the Respondent would be impolite. It did not accept as a matter of fact that the Appellant would not be addressed by name. It was of the view that other employees would have been beckoned in this way on occasion and that the reason for this would have been the noisy environment. Accordingly the ET did not consider that the Appellant had been the subject of less favourable treatment. The manner in which the second Respondent dealt with the Appellant was the same as he dealt with other staff, including those that the Appellant had included as comparators: see paras. 41.1-41.5, read with para. 7. On that basis the ET rejected the claim of direct discrimination and also the claim of harassment: see paras. 41.5-41.6.
- In arriving at that finding the ET may well have taken into account facts which were adduced in evidence not only by the Appellant but also by the Respondents. However, in my view, there was nothing impermissible about that. As the authorities of Laing and Madarassy make clear, there is a vital distinction between the "facts" and any "explanation." It is only the explanation which cannot be considered at the first stage of the analysis. Those authorities make it clear that evidence adduced by a respondent can properly be taken into account at the first stage when a tribunal is deciding what the "facts" are in order to see if a prima facie case of discrimination has been established by the claimant.
- The Appellant's second complaint before the ET was that on various occasions the second Respondent would require the Appellant to speak to him personally about absence from work and that the second Respondent was angry with him. The second Respondent would insist that the Appellant attend work even when he was ill: see para. 42, read in conjunction with the findings of fact at para. 8.
- The ET concluded that the Appellant had "an exceptionally poor attendance rate" and it was likely that the second Respondent did express some frustration which was related to the extent of his absenteeism. Some of that frustration was because of the second Respondent's poor management skills. However, the ET did not consider that the Appellant had been the subject of less favourable treatment: see para. 42.3. The cause of the second Respondent's expression of frustration was the significant absenteeism and his own weakness in dealing with it under the first Respondent's procedures. The ET concluded that:
"If a non black employee, with similar service and in a similar role had a similar level of absenteeism to the Claimant the manner in which the second Respondent would have dealt with that comparator would be no different to the way in which he dealt with the Claimant given the reasons for the treatment." (para. 42.3)
On that basis the ET found that this claim of direct discrimination was not well founded. For similar reasons it found that the claim of harassment in this respect was also not well founded: see para. 42.4.
- In my view, the ET did not impermissibly take into account anything that it should not have done in this context. All it was doing was making findings of fact based on all of the evidence before it. Because it concluded that there was no less favourable treatment as compared with the relevant comparators, there was no reason for it to ask what was the reason for the apparently discriminatory treatment.
- The Appellant's third complaint before the ET was that there were significant difficulties with his pay at times when he applied for annual leave: see para. 43, read with para. 9 of the judgment.
- However, the ET found as a fact that it was not only the Appellant who suffered these difficulties; "the problem extended to many others": see para. 43.1. This was due to training issues in the use of a particular system for recording holidays and ensuring payroll. "The Claimant was not treated differently to others": see para. 43.2. Accordingly the ET concluded that the Appellant had not been the subject of less favourable treatment and comparators suffered the same difficulties with pay: see para. 43.3. On that basis the ET rejected the claim of direct discrimination in this regard. For the same reasons it rejected the claim of harassment in this regard: see para. 43.4.
- Again, in my view, there is nothing impermissible in the approach taken by the ET in that analysis of the third complaint. Again it found as a fact that there was no less favourable treatment as between the Appellant and his comparators. Accordingly there was no reason for the ET to consider what the reason for any prima facie discrimination may have been. There was no prima facie discrimination.
- The Appellant's fourth complaint before the ET was that, when he submitted his requests for annual leave the second Respondent would ignore those requests: see para. 44, read with para. 10 of the judgment.
- However, the Appellant faced a fundamental difficulty with this complaint: the ET came to the simple conclusion that on the evidence the facts simply had not been established by the Appellant. At para. 44 the ET said: "We concluded that the Claimant had not proven the factual foundation for this complaint." At para. 10.4 the ET said:
"We did not consider that there was evidence from which we could draw the conclusion, on the balance of probabilities, that the second Respondent had acted as the Claimant describes."
- Section 136 had nothing to do with those findings. It was simply an ordinary exercise of the making of findings of fact, having regard to the normal standard of proof in civil proceedings. Those facts had not been proved by the Appellant as they needed to be.
- The Appellant's fifth complaint before the ET was that he was removed from working on the customer service desk whenever the second Respondent found him working there: see para. 45, read with para. 11 of the judgment. The ET found as a fact that the customer service desk was only manned during the morning and, since 2009, the second Respondent was no longer working during its hours of opening. It found that the claim of discrimination in this regard was brought many years after the limitation period (three months) had expired and the Appellant had not demonstrated that it would be just and equitable to extend time for bringing this claim: see para. 45.3. It is impossible for the Appellant to go behind those findings and permission was not granted to appeal against them by Bean LJ.
- Further, and in any event, the ET did not consider that the Appellant had been the subject of less favourable treatment in this regard. This was because the reason for moving the Appellant would be based on the need for specific tasks to be undertaken on the basis of need and therefore a comparator with the Appellant's skills working on the desk would also have been moved to a new task in the same way: see para. 45.2.
- In my view, this was again an example of the ET having regard to all of the evidence at the first stage of the enquiry in a permissible way to make findings of fact that there simply had not been less favourable treatment of the Appellant by reference to the relevant comparators.
- The Appellant's sixth complaint before the ET was that the second Respondent did not engage in one-to-one meetings with him and that he received no training and was not provided with any formal supervision: see para. 45, read with para. 12 of the judgment.
- The ET found that the second Respondent had held some one-to-one meetings but not with the majority of his staff: see para. 46.1. Further, the ET found as a fact that the Appellant had undergone training in a number of matters: see para. 46.2. The Appellant received no training about becoming a forklift operator. However, it was not the second Respondent who made the decision as to who should be trained; that was a decision made by a Mr Parsons and there had been no complaint made by the Appellant about his treatment at the hands of Mr Parsons: see paras. 46.4-46.5. The ET came to the conclusion that the burden of proof had not shifted to the Respondent in this respect: see para. 46.6. Further, it was the ET's view that the burden of proof had not shifted in respect of the claim of harassment in this regard either: see para. 46.8.3.
- In my view, these were findings of fact which were open to the ET on the evidence before it when taken as a whole. Subject to the second ground of appeal (which concerns whether it was a misdirection to refer to the burden of proof being on a claimant at the first stage at all), I can see no error of approach in relation to the first ground of appeal.
- The Appellant's seventh complaint before the ET was that he had been subject to poor treatment at the hands of the second Respondent after complaining in 2010: see para. 47, read with para. 13 of the judgment. However, the ET found on the evidence that there were a variety of reasons unconnected with the Appellant's race or the fact that he had made a complaint about his treatment. It also found that "the Respondent's management of the same … were less than optimum": see para. 47.1. The ET found that there were many such payroll mistakes amongst a broad group of staff and that these were mistakes arising out of poor management training in the systems used by the first Respondent: see para. 47.2. The ET did accept that the complaint in 2010 could be categorised as a "protected act." However, there was no evidence that the Respondents saw it as the Appellant raising the issue of poor treatment as being on the grounds of his race: see para. 47.4. On that basis the claim of victimisation was not well founded: see para. 47.5. Further, the ET did not consider that the Appellant had been the subject of less favourable treatment in this regard: see para. 47.6. It found expressly that comparators in his position "suffered payroll errors in the same way as the claimant did": see para. 47.6.
- Again, in my view, although there is a certain infelicity in the drafting of the judgment, the ET did not fall into the error alleged in the first ground of appeal. It was simply making findings of fact based on all of the evidence at the first stage of the enquiry. It found that there was no less favourable treatment of the Appellant as compared with others. That was not to do with any "explanation" for prima facie discrimination which the Respondent might have put forward at the first stage.
- The Claimant's eighth complaint before the ET related not to discrimination as such but to the claim of unfair dismissal based on alleged constructive dismissal: see para. 48, read with para. 14 of the judgment. This was an issue on which Bean LJ refused permission to appeal in his judgment at the hearing on 15 July 2015, as is plain from the transcript. As he observed on that occasion, it is extremely difficult to overturn the ET's findings of fact on the ground of perversity. He could find no basis on which any appellate court could do so. Accordingly I will say no more about the eighth complaint by the Appellant.
- Overall, I have come to the conclusion that the first ground of appeal must be rejected, however attractively the submissions on behalf of the Appellant were presented by Mr Dennis.
The Second Ground of Appeal
- The second ground of appeal advanced by Mr Dennis is based on the decision of the EAT in Efobi. Mr Dennis submits that, as Elisabeth Laing J made clear in that case, the wording of section 136 of the Equality Act does not impose a burden of proof on a claimant at all. In the present case, in common with many other tribunals, the ET directed itself that there was a burden of proof on the claimant at the first stage of the enquiry and therefore, submits Mr Dennis, it fell into error.
- This submission raises a point of some general importance and requires this Court to consider whether Elisabeth Laing J was correct to decide in Efobi that section 136 has changed the law as it had been previously determined to be by this Court in cases such as Igen and which was approved by the Supreme Court in Hewage.
- The best point that is available to Mr Dennis is that the wording of section 136 is different from the wording of the equivalent predecessor provisions in the Sex Discrimination Act 1975, the Race Relations Act 1976 and the Discrimination Disability Act 1995. As Elisabeth Laing J observed, the wording is indeed different. There is no longer any express reference to: "Where … the complainant proves facts", as there was in section 54A of the 1976 Act and its "sibling" provisions.
- Mr Dennis accepts, and indeed positively asserts, that there is still a burden at the second stage, which lies on the respondent to explain why it acted as it did. However, Mr Dennis does not accept that there is any shifting of the burden from the claimant to the respondent. He submits that there can be situations in employment law where there may be a burden imposed on one party at one stage but no burden at another stage of the enquiry. As an example of that, he reminds this Court of the law of unfair dismissal. In that context it is well established that the burden of proving that an employee was dismissed lies on the claimant; the burden of showing what the reason for the dismissal was, and that it was a potentially fair reason, lies on the respondent, under section 98(1) and (2) of the Employment Rights Act 1996; but, when it comes to assessing the fairness of the dismissal, there is no burden on either party. That assessment is simply one for the tribunal to make, which must decide whether the decision to dismiss was reasonable, having regard to all the circumstances, under section 98(4) of the 1996 Act.
- I am not persuaded that there is an exact analogy with that context. As Mr Dennis observes, that is a context in which the tribunal is called upon to make an assessment: was the dismissal fair, in other words did it fall within the range of responses open to a reasonable employer? That involves an exercise of evaluation or judgement. It is not a context in which it is apt to refer to a burden being on either party.
- But the present context is different. Before a tribunal can start making an assessment, the claimant has got to start the case, otherwise there is nothing for the respondent to address and nothing for the tribunal to assess.
- In my view, this point is reinforced by considerations of fairness. The language of section 136 makes it clear that, if the inference of discrimination could be drawn at the first stage of the enquiry, then it must be drawn by the court or tribunal. The consequence will be that the claim will necessarily succeed unless the respondent discharges the burden of proof, which Mr Dennis accepts does lie on it at the second stage. I can see no reason in fairness why a respondent should have to discharge that burden of proof unless and until the claimant has shown that there is a prima facie case of discrimination which needs to be answered. It seems to me that there is nothing unfair about requiring that a claimant should bear the burden of proof at the first stage. If he or she can discharge that burden (which is one only of showing that there is a prima facie case that the reason for the respondent's act was a discriminatory one) then the claim will succeed unless the respondent can discharge the burden placed on it at the second stage.
- I am reinforced in that view by the Opinion of Advocate General Mengozzi in Galina Meister, cited above. As the Advocate General said there, this interpretation maintains a fair balance between the rights of a claimant and those of a defendant or respondent.
- The fact that the side-note to section 136 is worded "Burden of proof" is of limited weight as an aid to construction but it is nevertheless also a point against the construction adopted by Elisabeth Laing J in Efobi. In R v Schildkamp  1, at 10, Lord Reid said:
"a side-note is a poor guide to the scope of a section, for it can do no more than indicate the main subject with which the section deals."
- Of greater weight, in my view, is that there is no reason to suppose that the mischief that Parliament was addressing in enacting section 136 was that the previous legislation, as interpreted by this Court in Igen and as applied by tribunals ever since, had caused any difficulties which made it appropriate to remove the burden of proof from a claimant at the first stage of the enquiry, when everyone accepts that there was such a burden until the Equality Act came into force. Although Elisabeth Laing J was right to point out that what is said by the executive in Explanatory Notes cannot be taken to represent the intention of Parliament, it is telling that nothing in the Explanatory Notes (which addressed section 136 at paras. 443-4) or in any other document which led up to the enactment of the Equality Act pointed to there being any perceived mischief that needed a change of substance in the law.
- The initial consultation paper, 'A Framework for Fairness: Proposals for a Single Equality Bill for Great Britain', published in 2007, contained only one reference to the burden of proof, which was to implement the Recast Gender Directive by introducing a statutory provision extending the reverse burden of proof to accessing goods and services. The response to the consultation 'The Equality Bill – Government Response to the Consultation Paper', published in 2008, made two references to the burden of proof: first, it accepted that the law on the burden of proof in equal pay disputes should be clarified; and secondly, that the principle should be extended to non-employment disability discrimination cases. The paper, 'Framework for a Fairer Future – The Equality Bill', published in 2008, and the 'New Opportunities' White Paper, published in 2009, do not contain any reference to the burden of proof.
- I have also looked at the further background to the proposal that there should be a single Equality Act, which had been debated in the academic and professional community in this area of law for 10 years or more. In particular I note that in 2000 the late Professor Sir Bob Hepple had chaired a report under the auspices of the Centre for Public Law at the University of Cambridge. Nothing in that report had suggested that the burden of proof should not be placed on a claimant at the first stage. Its discussion of the issue at paras. 4.37-4.39 had simply concluded with a recommendation (numbered 47) that the Burden of Proof Directive should be implemented in domestic law.
- It is also of some significance that the EU Directive to which section 136 gives effect in domestic law does not require there to be no burden on a claimant at the first stage, as Elisabeth Laing J noted in Efobi. As she also noted, the absence of such a requirement does not prevent a Member State from voluntarily going further and enacting a measure that is more favourable to claimants. However, again one would expect there to be some material in the process leading up to the enactment of the Equality Act to show that there was a mischief that Parliament wished to remedy and that it did indeed intend to go further than EU law requires. We were shown no such material by Mr Dennis and I have not been able to find it.
- The academic and other commentaries which accompanied the enactment of the Equality Act in 2010 and which have been written since then contain no such material either. To the contrary the legal community (in its widest sense) has proceeded for the last seven years on the assumption that no change of substance was made by section 136.
- For example, in Equality: The Legal Framework (2nd ed., 2014), pp.203-5, Sir Bob Hepple adopted the orthodox interpretation of section 136. Moreover, he did not offer any criticism of the provision or its interpretation. Similarly, in Equality Law (2nd ed., 2013), paras. 14.83 and 14.88, Karon Monaghan QC gives the conventional understanding of section 136, that it replicates in substance what had gone before.
- It is also of some interest that the Equality and Human Rights Commission Code of Practice, published in 2015, adopts the language of the provisions replaced by section 136 (at para. 15.32): "A claimant alleging that they have experienced an unlawful act must prove facts from which an Employment Tribunal could decide or draw an inference that such an act has occurred."
- What then is to be made of the fact that the wording of section 136 is different from the predecessor provisions? It seems to me that the answer lies in the fact that the previous wording was not entirely clear that what should be considered at the first stage was all the evidence, from whatever source it had come, and not only the evidence adduced by the claimant. Its express wording was apt to mislead in that regard, as it referred only to the complainant. This had been clarified in the case law on the predecessor provisions, in particular by the EAT in Laing, which was approved by this Court in Madarassy. Parliament can be taken to have known of that case law when it enacted section 136. The provision can sensibly be read as making that point clear on the face of the legislation.
- It may also be that the wording of section 136 is an example of a desire on the part of Parliament to use plainer English. Even subsection (3) does not expressly refer to a "burden" being placed on the respondent at the second stage but clearly that is its effect as a matter of substance, as Mr Dennis fairly accepts.
- In any event, it seems to me that the difference of wording between section 136 and its predecessor provisions should be regarded, in context, as no more than a legislative "tidying up" exercise. It was not intended to change the law in substance and certainly not in the fundamental way held by Elisabeth Laing J in Efobi, of no longer imposing a burden on a claimant at the first stage of the enquiry.
- Accordingly I have come to the conclusion that previous decisions of this Court such as Igen, as approved by the Supreme Court in Hewage, remain good law and should continue to be followed by courts and tribunals. The interpretation placed on section 136 by the EAT in Efobi is wrong and should not be followed.
- In the light of that it follows that I reject Mr Dennis' second ground of appeal.
- For the reasons I have given I would dismiss this appeal.
Beatson LJ :
- I agree.
Davis LJ :
- I also agree.
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