R (Hottak) v Secretary of State for Foreign and Commonwealth Affairs

The Court of Appeal dismissed the challenge by Afghan locally employed staff (LES) to the Government’s Afghan assistance scheme. The court held that the substantive anti-discrimination provisions in Part 5 (work) and Part 3 (services and public functions) of the Equality Act 2010 did not, on the facts, extend territorially to give the claimants an entitlement in England: the employment-related provisions require an exceptional connection with Great Britain before they apply and that connection was not present here (applying the principles in Lawson v Serco Ltd and subsequent authorities). The court also rejected direct and indirect discrimination claims on the merits because the differences between the Iraq and Afghan schemes were explained by materially different local conditions and policy choices rather than nationality-based discrimination. The Divisional Court’s finding that the Public Sector Equality Duty (PSED), section 149(1)(b) and (c), should have been considered when formulating the Afghan scheme was upheld, but declaratory relief only was appropriate because an equality assessment had subsequently been carried out and remedial changes made.

Background and parties:

• The claimants, Afghan nationals who had worked as interpreters for British Forces in Afghanistan, sought judicial review of the Government’s alleged failure to offer an assistance scheme to Afghan LES comparable to the Iraq LES scheme.
• They advanced complaints under the Equality Act 2010 (direct and indirect discrimination and discrimination in the exercise of public functions) and at common law, and pleaded breach of the public sector equality duty (PSED) in formulating the Afghan Scheme.

Procedural posture: The claim was heard in the Divisional Court ([2015] EWHC 1953 (Admin)), which granted a declaration that the defendants had failed to have due regard to section 149(1)(b) and (c) of the Equality Act 2010 but otherwise dismissed the claim; the claimants appealed to the Court of Appeal.

Issues before the Court of Appeal:

1. Whether the work-related provisions of the Equality Act 2010 (Part 5) apply extra-territorially to Afghan LES employed and working in Afghanistan.
2. Whether section 29(6) (discrimination in exercise of public functions) applies to the promulgation of the Afghan Scheme.
3. Whether, on the merits, the Afghan Scheme amounted to direct or indirect discrimination or to an unlawful common-law disparity.
4. Whether the Divisional Court should have granted substantive relief (quashing or mandatory orders) for breach of the PSED rather than the declaratory relief it made.

Reasoning and outcome:

• The court applied the established territoriality principles from Lawson v Serco Ltd and subsequent cases (Duncombe, Ravat, et cetera): the employment must have a substantially stronger connection with Great Britain than the place of work for Part 5 to apply. On the facts (Afghan nationals, contracts governed by Afghan law, work and residence in Afghanistan, limited links to the UK) there was no such exceptional connection; the Divisional Court’s conclusion of no jurisdiction under Part 5 was upheld.
• Section 29(6) was likewise held not to extend to the claimants’ complaints: Part 3 does not provide an alternative route where Part 5 would otherwise govern work-related discrimination but lacks territorial reach; the court declined to impute to Parliament an intention to give section 29(6) broader extraterritorial effect.
• On the merits, differences between the Iraq and Afghan schemes were found to reflect material differences in local circumstances, risk assessment and policy choices rather than nationality-based less favourable treatment; direct and indirect discrimination claims and the common-law complaint failed.
• On the PSED, the court accepted that the defendants should have had due regard to section 149(1)(b) and (c) when formulating the Afghan Scheme, but it was appropriate to limit relief to declarations because a thorough equality analysis had subsequently been performed and led to changes to the scheme; quashing the scheme would have been unnecessary and potentially harmful to beneficiaries.

Appeal dismissed. The Court of Appeal upheld the Divisional Court’s conclusions that (i) Part 5 of the Equality Act 2010 did not extend territorially to the claimants’ Afghan employment (no sufficiently strong connection with Great Britain), (ii) Part 3 (section 29(6)) did not provide an alternative extraterritorial cause of action for these work-related claims, and (iii) there was no direct or indirect discrimination or unlawful common-law failure. The court affirmed that the PSED (section 149(1)(b) and (c)) applied to the formulation of the Afghan Scheme but that declaratory relief rather than quashing or mandatory relief was appropriate because a post-decision equality assessment had been carried out and changes made.

Appeal from the Divisional Court (Burnett LJ and Irwin J) [2015] EWHC 1953 (Admin). The Divisional Court granted declarations on PSED failures but dismissed the remainder of the claim; permission to appeal was given as to relief for PSED issues and other grounds, leading to this Court of Appeal judgment [2016] EWCA Civ 438.