What to do if clients force you into discriminatory practices

Tim writes: “I have discussed discrimination law with a selection of IP professionals up and down the land and one issue was raised on a few occasions – international clients.

Of course, UK employers are under a duty to ensure fairness in the workplace and prevent discrimination.  This task is then made arguably more complicated for employers with international clients for whom different cultural norms and practices may apply, from countries with less stringent laws to prevent discrimination than our own.

This blog article will consider the legal position where clients seek to impose restrictions on employers in terms of which of its employees should or should not undertake work on their behalf.

By way of background, save for in certain prescribed circumstances, employers are prevented from either directly or indirectly discriminating against their employees and this is defined as follows:

• Direct discrimination occurs where an employee is treated less favourably because of a ‘protected characteristic’ (defined as age, disability, gender reassignment, marriage or civil partnership, race, religion or belief, sex or sexual orientation). This can usually only be lawful if there is a ‘genuine occupational requirement’ to act in such a discriminatory way.

• Indirect discrimination occurs where an individual with a protected characteristic and a group of employees with the same protected characteristic are disadvantaged due to a practice of the employer which has been applied to all. This can usually only be lawful if it is a proportionate means of achieving a legitimate aim or ‘objectively justified’.

So far, so straightforward.

However, the legal waters become murkier when an employer proposes to treat members of its staff less favourably at the behest of a (perhaps valuable) international client.  In a situation where a client specifies that an individual or a group of employees with protected characteristics undertake or are prevented from undertaking a particular job, is the employer then liable? Can such prima facie discrimination ever be lawful? 

The law will not differentiate between discriminatory actions carried out of your own volition and those carried out at another’s instruction; an employer will need to look at the actions it proposes to carry out and ask itself whether they are lawful in their own right, notwithstanding the fact they may be at the request of a third party.  Neither is greater latitude afforded to discriminatory behaviour where it originates from a client of a different culture or background.  The same arguments run, and the same defences apply, whatever the source of the purported discrimination.If an employer follows its client’s instructions and prevents certain of its employees with a protected characteristic from undertaking a job because of that characteristic, this risks constituting direct discrimination.  In such cases, the ‘genuine occupational requirement’ defence may be run.  This defence operates to allow someone with or (without) a protected characteristic to undertake a job in restricted circumstances, such as an actor playing a role where being of a specific ethnicity is a requirement.  However, where a client instructs an employer to use someone from a particular group to do a job that someone else could equally do, the defence won’t apply; the requirement of the client for someone from a particular group could not be a ‘genuine occupational requirement’ of itself.

It is also worth noting that for an act of direct discrimination to be unlawful, the individual must have suffered ‘less favourable treatment’ which case law has concluded must amount to some form of detriment.  So, an employer could argue that restricting access to an international client in this way would not materially affect the individual’s career prospects and so does not amount to a detriment. However, this would be a somewhat risky argument to rely on as there is generally a connection between client access and billing figures and then between billing figures and career prospects (including pay rises). Also, just the very fact of being side-lined in this way could well amount to a detriment as it would make an individual feel isolated and unsupported. So, whilst any financial consequences for the individual could well be slight or even non-existent, this is still likely to amount to less favourable treatment and direct discrimination.

It may be argued that a policy to be sensitive to the cultural background of all its clients and to carry out their instructions wherever possible is a work practice applied by employer to all.  Such discrimination could be categorised as indirect rather than direct and would therefore be capable of being objectively justified. Justification must be on the basis that it is a proportionate means of meeting a legitimate aim, for example where the disadvantage is only slight and the rewards of retaining the client are large.

The reality is that it will be difficult for an employer to justify discrimination where their primary motive is to keep their most valuable clients happy.  This is because it is not possible to objectively justify discriminatory rules or policies on a costs basis alone. There would need to be a further business need, for example economic efficiency, health welfare and safety and it is unlikely that such a business need would arise in this situation.

So, in conclusion, whilst there may be some technical arguments relating to ‘detriment’ and ‘objective justifications’ relevant to this situation, I do think that their application will be very narrow. Therefore if an employer did allow its client to impose restrictions, on who did and didn’t work for them based on any protected characteristics, an employer would be exposed should an employee wish to issue a discrimination claim as a result.

Also, in protecting their reputation (both internally and externally) employers will usually wish to explicitly distance themselves from any potential discriminatory behaviour; it is not unusual, and is in fact advisable, for a business to include in its Equality and Diversity Policy a statement to the effect that ‘[Company] shall not accept instructions from clients that indicate an intention to discriminate unlawfully.’

If you think your business would benefit from training to help raise awareness of discrimination issues amongst your workforce and help avoid pitfalls, please feel free to email me directly.”

Thank you Tim for this incredibly interesting blog article, and the practical tips for employers and employees who may face these issues.  We hope to run a webinar or training sessions on this topic in the near future.

If you would like to write a blog article for IP Inclusive, on anything diversity related, please email Emily Teesdale of Abel & Imray. Guest bloggers are always very welcome.  ​