Ahsan v The Labour Party

Compensation for unlawful discrimination extends to loss which directly and naturally flows from the discriminatory act. A factual but for connection alone does not establish recoverable loss.

Where each later selection is a fresh decision, earlier non-selection will ordinarily compensate only the lost term of office. A later loss may be recoverable if the earlier wrong directly caused a proved loss of political capital that caused the later non-selection. No award is available where the later loss in fact resulted from the claimant leaving the party, even if that departure may have followed a separate wrong not within the proceedings.

The claimant had been prevented by three acts of racial discrimination and victimisation from being selected as a Labour candidate for Birmingham City Council elections in 1998, 1999 and 2000. At a remedy hearing, the Employment Tribunal awarded full lost councillor’s allowances until May 2002, no loss until June 2004, and 25 per cent of allowances from June 2004 to May 2008.

The claimant appealed the denial of allowances between May 2002 and June 2004 and challenged the later limits. The respondent cross-appealed, contending that loss after June 2004 was not caused by the earlier unlawful non-selections. The central issue was the proper causal scope of compensation for the established discriminatory acts.

1. The appeal and cross-appeal were each allowed in part. The award for the period from June 2004 to May 2008 was quashed. The claimant was entitled to full lost allowances from May 2002 to June 2004.

2. The parties had mistakenly proceeded on the basis that suspension from Labour Party membership in March 2002 prevented the claimant from receiving councillor’s allowances. It did not. Had he been elected in 2000, he would have served until June 2004 and remained entitled to allowances despite the suspension. It was just to correct that common error.

3. For loss after June 2004, a simple but for test was insufficient. Following Essa v Laing Ltd [2004] ICR 746, compensation was confined to consequences directly and naturally flowing from the unlawful acts. Each selection and election was a fresh exercise dependent on the circumstances at that time.

4. The court accepted that a wrongful de-selection might in principle cause a later financial loss through proved loss of political capital. That possibility required evidence and a causal connection to the later failure to be selected. On the facts, there was no evidence of a material loss of relevant political capital.

5. In any event, the decisive cause of the claimant’s absence from office after June 2004 was that he had left the Labour Party and stood for another party. Any alleged wrong in his suspension or its subsequent handling was a distinct matter outside these proceedings. Beart v Prison Service (No 2) [2005] ICR 1206 was distinguishable because the potential political-capital loss had never eventuated.

6. The case was remitted to the same Tribunal, if practicable, to calculate the allowances due from May 2002 to June 2004 if the parties could not agree them.

• Employment Appeal Tribunal: allowed the claimant’s appeal concerning allowances from May 2002 to June 2004, and allowed the respondent’s cross-appeal concerning all loss after June 2004.
• Employment Tribunal, Shrewsbury: in a remedy judgment promulgated on 22 January 2010, awarded full allowances until May 2002, no allowances until June 2004, and a 25 per cent chance-based award from June 2004 to May 2008.
• House of Lords: dismissed the earlier appeal concerning liability and remitted the established claims for a remedy hearing: Watt v Ahsan [2008] ICR 82.