Wright v Nipponkoa Insurance (Europe) Ltd

An Employment Tribunal may strike out a discrimination claim only where it has no reasonable prospect of success. It must exercise particular caution where material facts remain disputed, but may strike out an incoherent claim founded only on racial stereotyping and unsupported by a factual basis.

A tribunal considering a hypothetical comparator may use the treatment of a real person with the same relevant protected characteristic as evidential material. A deposit order requires only a little reasonable prospect of success. The tribunal has a broad discretion, but must consider relevant matters, including the party’s means. Where separate deposits are ordered for separate allegations, it must also consider the proportionality of their total amount.

The Claimant, an English Caucasian marine underwriter employed by a Japanese insurance company, brought claims of race discrimination and detriment for making a protected disclosure. He alleged that conduct before a merger with another Japanese insurer reflected Japanese cultural deference and racial preference.

At a preliminary hearing, the London (Central) Employment Tribunal struck out two race-discrimination allegations under Rule 37 and made deposit orders on seven allegations under Rule 39 of the Employment Tribunal (Constitution and Rules of Procedure) Regulations 2013. The Claimant appealed the strike-outs, the deposit orders, and their amount.

The central issues were whether the Tribunal had erred in its comparator analysis and assessment of the claims’ prospects, and whether the cumulative deposits were lawful and proportionate.

1. Appeal allowed in part. The appeal succeeded only against the deposit order concerning the race-discrimination allegation arising from an email in Japanese. The remaining challenges to the strike-outs and deposit orders were dismissed.

2. The Employment Judge was entitled to strike out claims 2 and 3. Although the Claimant relied on a hypothetical comparator, the Judge could treat the appointment of another English Caucasian person as evidentially relevant when testing that hypothesis. Cultural or ethnic traits may be relevant to race, consistently with [1983] ICR 385. However, the Claimant’s allegation rested on an unsupported racial stereotype about Japanese managerial deference. It did not disclose facts from which discrimination because of race could reasonably be inferred.

3. The Employment Judge applied the correct Rule 39 threshold to the other deposit claims. A deposit order does not finally determine disputed facts or prevent a trial. It is available where the Tribunal has a proper basis for doubting whether the party can establish facts essential to the allegation. The Judge was entitled to find that claims 1, 4, 5, 7, 10 and 11 had little reasonable prospect of success, particularly because the alleged detriments disclosed no sufficient connection with race or the protected disclosure.

4. The deposit order on claim 6 was unsafe. The Employment Judge failed to address the specific case that the Claimant had been copied into a potentially insulting Japanese email because its authors assumed that, as an English person, he could not understand it. That potentially relevant matter could support an allegation of deliberate mocking linked to nationality. Its omission might have affected the assessment of prospects.

5. Rule 39 permitted separate deposits for separate allegations. When making several orders, however, a Tribunal should stand back, consider the total sum, and assess proportionality. The Employment Judge did so, considered the Claimant’s means, and was entitled to order seven deposits of £300, totalling £2,100.

6. The subsequent application for review and application for permission to appeal to the Court of Appeal were refused.

• Employment Appeal Tribunal: Appeal allowed only in relation to the deposit order on claim 6; all other challenges dismissed. Review and permission to appeal to the Court of Appeal were refused.
• London (Central) Employment Tribunal: Employment Judge Professor Neal struck out claims 2, 3 and 8 and imposed deposits on claims 1, 4, 5, 6, 7, 10 and 11. The judgment was sent to the parties on 2 December 2013.