Kemeh v Ministry of Defence

The Court of Appeal dismissed the appellant's challenge. The court held that section 32(2) of the Race Relations Act 1976 should be read by reference to the ordinary legal concept of agency rather than a broader lay or purposive notion divorced from common law agency principles. On the facts there was no agency relationship between the Ministry of Defence and the civilian butcher (employed by Sodexo), so the Ministry was not liable under section 32(2) for her racially abusive comment. The court also upheld the Employment Appeal Tribunal's reduction of the award for injury to feelings under the Vento bands, finding the Employment Tribunal's figure of £12,000 manifestly excessive and substituting £6,000.

The appellant, a black soldier born in Ghana, brought claims under the Race Relations Act 1976 after two separate racially abusive incidents while posted to the Falkland Islands in June 2010. One insult was made by a civilian butcher employed by Sodexo and the other by the appellant's immediate line manager, a sergeant in the Ministry of Defence (MoD).

The claims were heard together in the Employment Tribunal. Liability for the sergeant's remark was accepted on the basis that military personnel were in employment of the MoD by virtue of section 75 of the 1976 Act and the MoD accepted liability under section 32(1). The Employment Tribunal found the MoD also liable for the butcher's remark under section 32(2) on the basis that the contractor's staff were acting as agents of the MoD. The Tribunal awarded £12,000 for injury to feelings in relation to the sergeant's remark.

The MoD appealed to the Employment Appeal Tribunal which set aside the Tribunal's finding of agency and reduced the award for injury to feelings to £6,000. The appellant appealed to the Court of Appeal.

Issues framed by the court: (i) whether section 32(2) should be construed by reference to common law agency or a broader statutory concept that would capture contractor employees who work under the directional control and integration described by the Employment Tribunal; and (ii) whether the Employment Tribunal's award for injury to feelings was within the appropriate Vento band or manifestly excessive.

The Court of Appeal concluded that Parliament used the terms "agent" and "principal" in section 32(2) in the sense recognised at law and that the common law concept of agency applies. Applying that legal standard, the court found there was no cogent evidence that the civilian butcher was authorised to act on behalf of the MoD in the relevant sense and therefore no agency; the MoD was not liable for her act. On quantum, the court held that the Employment Tribunal's £12,000 award for a one-off offensive comment was outside the proper range under the Vento guidance (as updated by later authorities) and was manifestly excessive; the EAT's substituted figure of £6,000 was appropriate.

The court noted the policy concern that a gap in remedies can arise where contractor employees discriminate and observed that Parliament may wish to consider the statutory lacuna, but declined to reinterpret section 32(2) to create a remedy.

The appeal was dismissed. The Court of Appeal held that section 32(2) of the Race Relations Act 1976 is to be construed by reference to the ordinary legal concept of agency; on the facts there was no agency relationship between the civilian butcher (employed by Sodexo) and the Ministry of Defence, so the MoD was not liable for her discriminatory remark. The court also held that the Employment Tribunal's award of £12,000 for injury to feelings was manifestly excessive for a one-off offensive remark and upheld the EAT's reduction to £6,000 under the Vento guidance.

Appeal from the Employment Appeal Tribunal (UKEAT/0249/12/SM) where the EAT set aside the Employment Tribunal's finding of agency and reduced the award for injury to feelings. The present appeal to the Court of Appeal (reported as [2014] EWCA Civ 91) was dismissed.