Hounga v Allen & Anor

Illegality does not automatically bar an independent statutory discrimination claim. The court must ask whether the claim arises from, or is inextricably bound up with, the claimant’s illegal conduct so that allowing compensation would appear to condone it. A claim is barred where the claimant relies materially on illegal immigration and employment status as the basis of the alleged discrimination. Separate statutory grievance exemptions require separate analysis. A finding that compliance became reasonably practicable after an initial period does not answer whether compliance was practicable within a reasonable period. In this case the dismissal discrimination claim was barred, and although the procedural appeal succeeded, no remission was ordered.

Ms Hounga, a Nigerian national, worked as an au pair for the respondents despite knowing that her visitor’s visa did not permit work. She alleged race discrimination in her treatment and dismissal.

The Employment Tribunal held that the employment contract was illegal, dismissed the contractual and unfair dismissal claims, upheld the dismissal discrimination claim, and dismissed the non-dismissal discrimination claim for failure to raise a grievance. The Employment Appeal Tribunal upheld those decisions in UKEAT/0326 to 03229/10/LA. Ms Hounga appealed on the statutory grievance exemptions under the Employment Act 2002 (Dispute Resolution) Regulations 2004. Mrs Allen cross-appealed on the illegality defence.

Lord Justice Rimer gave the judgment, with which Sir Scott Baker and Lord Justice Longmore agreed.

1. The Employment Tribunal’s decision, made of its own motion on an unargued jurisdiction point, was procedurally unfair. Ms Hounga had not been given an opportunity to address the grievance issue.
2. The questions under regulations 6(4)(c) and 11(3)(c) of the Employment Act 2002 (Dispute Resolution) Regulations 2004 were materially different. A finding that it became reasonably practicable to present a grievance after 11 March 2009 did not imply that it had been practicable to do so within a reasonable period. Both tribunals had failed to address regulation 11(3)(c). That issue was factual and ordinarily had to be remitted to the Employment Tribunal, not decided by the Court of Appeal.
3. The regulation 11(3)(b) argument nevertheless failed. Although the Tribunal’s reasoning was flawed, Ms Hounga had adduced no evidence establishing her perception of the risk of further harassment or reasonable grounds for the belief required by the regulation.
4. The principles in Hall v Woolston Hall Leisure Ltd [2001] ICR 99 applied. A statutory discrimination claim may be barred on public-policy grounds where it arises from, or is inextricably bound up with, the claimant’s illegal conduct, such that recovery would appear to condone that conduct. The independent statutory character of the claim did not prevent the defence.
5. The employment contract was illegal from its inception. Ms Hounga knowingly participated in the arrangements enabling her to work without permission and relied on her illegal status, lack of employment rights and resulting vulnerability as the basis of the discrimination claim. Applying Vakante v Governing Body of Addey and Stanhope School (No 2) [2005] ICR 231, the claim was inextricably linked with her illegality. Allowing it would condone that illegality, notwithstanding the respondents’ greater responsibility and the sympathy due to her.
6. The cross-appeal was allowed. The dismissal discrimination judgment and consequential compensation and interest award were set aside. Since the non-dismissal discrimination claim could not succeed for the same public-policy reason, no remission was ordered and that claim was dismissed.

• Court of Appeal (Civil Division): allowed Ms Hounga’s appeal on the regulation 11(3)(c) issue and allowed Mrs Allen’s cross-appeal on the illegality defence; set aside the dismissal discrimination award; ordered no remission and dismissed the non-dismissal discrimination claim.
• Employment Appeal Tribunal: in UKEAT/0326 to 03229/10/LA, upheld the Employment Tribunal’s dismissal of the non-dismissal discrimination claim and its decision upholding the dismissal discrimination claim.
• London Central Employment Tribunal: dismissed the contractual, unfair dismissal and non-dismissal discrimination claims, but upheld the dismissal discrimination claim and awarded £6,186.90 for injury to feelings and interest.