Carter v Ahsan

An employment tribunal’s jurisdiction to determine a discrimination complaint depends on the statutory limits governing the subject matter and parties. Where binding appellate authority establishes, during pending proceedings, that the respondent falls outside those limits, the tribunal must cease substantive adjudication. An earlier unappealed jurisdictional ruling or order for a merits hearing cannot supply the missing jurisdiction. This differs from a subsequent change in the law governing the merits of a claim within jurisdiction.

Race must be an effective cause of detrimental treatment. Where non-selection rests on association with suspected malpractice within a racial community, that association alone does not establish discrimination. On the findings in this case, a finding that the underlying suspicion was itself racially discriminatory was required to justify the conclusion of racial discrimination.

Raghib Ahsan, a Labour councillor of Pakistani origin, brought three race discrimination claims against the Labour Party, represented by its General Secretary, concerning his repeated non-selection as a candidate. Matt Carter was the appellant representing the party. In the first claim, an employment tribunal ruled that the party was a qualifying body under section 12(1) of the Race Relations Act 1976. The Employment Appeal Tribunal upheld that ruling and directed a merits hearing. The party obtained permission to appeal but lodged no appeal.

All three claims were subsequently heard together. Before the tribunal promulgated its decision, the Court of Appeal held in Ali v McDonagh [2002] ICR 1026 that the party was not a qualifying body and that such complaints fell outside employment tribunal jurisdiction. The tribunal nevertheless promulgated findings substantially in Mr Ahsan’s favour.

The Employment Appeal Tribunal upheld jurisdiction over the first claim because of its earlier order, but rejected jurisdiction over the second and third claims. In a separate decision, it upheld the discrimination finding on the first claim. The party appealed both decisions, and Mr Ahsan challenged the rejection of his remaining claims. The questions were whether the earlier unappealed ruling preserved jurisdiction and whether the tribunal’s findings justified its conclusion of racial discrimination.

The appeals were allowed and the cross-appeals dismissed, by a majority of two to one, Sedley LJ dissenting.

1. Per Buxton LJ and Rimer J, employment tribunals possess exclusively statutory jurisdiction. Constitutive jurisdiction concerns their power to hear and determine issues by reference to the subject matter, the parties or the relief sought. It differs from an error of law made when deciding a matter properly within that power.

2. Sections 12 and 54 of the Race Relations Act 1976 made the respondent’s status as a qualifying body a condition of employment tribunal jurisdiction. Ali v McDonagh [2002] ICR 1026 established that the Labour Party did not have that status when selecting candidates. Once that binding decision had been delivered, the tribunal lacked jurisdiction to continue determining any of the pending claims. A complainant’s assertion of qualifying status could not create jurisdiction.

3. A true objection to jurisdiction may arise at any stage, and the tribunal must address it of its own motion. Agreement, acquiescence and estoppel, including issue estoppel, cannot confer the missing jurisdiction. The finality of ordinary decisions on fact or law remained intact. This case concerned the exceptional emergence of binding authority establishing that the tribunal lacked constitutive jurisdiction while the proceedings remained pending.

4. Per Rimer J, the earlier Employment Appeal Tribunal order meant that the first claim should progress towards a merits hearing, subject to the tribunal’s continuing control. It did not compel a hearing regardless of settlement, withdrawal, procedural default or a subsequent authoritative determination of the tribunal’s jurisdiction.

5. The majority also allowed the discrimination appeal on an independently sufficient ground. Race need only be an effective cause of the adverse decision, even where the decision-maker’s objectives are otherwise legitimate. Here, however, the primary findings established association with grants and membership problems, without establishing that the underlying suspicions were themselves racially discriminatory. The tribunal’s further conclusion of racial discrimination was therefore unjustified. The comparator issue did not resolve that deficiency.

6. Sedley LJ would have dismissed the appeals and allowed the cross-appeal. He considered that the pleaded complaints conferred jurisdiction and that the erroneous interpretation of section 12 concerned the merits, requiring correction by appeal. He also considered the findings sufficient to establish that ethnicity and ethnic associations influenced non-selection, without requiring an additional finding about the origin of the suspicions.

The finding on the merits of the first claim was set aside. The rejection of jurisdiction over the second and third claims remained effective.

1. Court of Appeal: In Carter v Ahsan [2005] EWCA Civ 990 , allowed the Labour Party’s jurisdiction and discrimination appeals and dismissed Mr Ahsan’s cross-appeals. The first claim’s merits decision was set aside, and the rejection of jurisdiction over the remaining claims was upheld.
2. Employment Appeal Tribunal, 21 June 2004: Silber J and two members upheld the employment tribunal’s finding of racial discrimination on the first claim. That decision was overturned by this court.
3. Employment Appeal Tribunal, 24 February 2004: Burton J and two members upheld jurisdiction over the first claim because of the earlier unappealed order, but allowed the party’s appeal concerning jurisdiction over the second and third claims. This court reversed the first conclusion and upheld the latter conclusions.
4. Employment Tribunal, 23 September 2003: Promulgated its decision asserting jurisdiction over all three claims and finding substantially in Mr Ahsan’s favour. Remedy was reserved.
5. Employment Appeal Tribunal, 14 July 1999: In Sawyer and Others v Ahsan [2000] ICR 1, upheld the preliminary ruling on qualifying-body status, granted permission to appeal and directed a merits hearing if no appeal was lodged. No appeal was lodged.
6. Employment Tribunal, 25 August 1998: Determined the qualifying-body preliminary issue in Mr Ahsan’s favour and ordered the first claim to be relisted on its merits.