Unite the Union v Nailard

The rule that election to lay office under a union rule book creates employment under the extended definition is incorrect. Membership rules and employer-funded facility time do not of themselves create a contract personally to do work under section 83(2) of the Equality Act 2010.

A union may however be liable under section 109(2) where lay officers act as agents within the authority given by the union.

For harassment or direct discrimination by decision-makers based on others' conduct, the tribunal must focus on the decision-maker's own conduct and reasons. Unwillingness or failure to act is only harassment or discrimination if that conduct itself is related to the protected characteristic.

The claimant was a paid regional officer employed by the union. She complained of sexual harassment by locally elected branch officers who carried out full-time facility time paid by their employer. The Employment Tribunal found the elected officers were employees under the extended definition and that the union was vicariously liable. It also found certain paid union officers liable for harassment or direct discrimination by failing to prevent harassment and by transferring the claimant. The union appealed those findings and the claimant cross-appealed limited points. The central questions were (1) whether elected lay officers were employees under section 83(2) of the Equality Act 2010, (2) whether the union was liable under section 109(2) as principal for acts of its officers, and (3) whether paid officers' failures or transfer decision amounted to harassment or direct discrimination by reference to their own conduct.

(1) Appeal allowed in part. The Employment Tribunal erred in law in holding that elected branch officers were employees under the extended definition in section 83(2) of the Equality Act 2010. The rule book and employer-funded facility time do not establish a contract personally to do work or subordination sufficient to satisfy the extended definition (see paras [34]–[38]; [38]).

(2) The ET was entitled to find alternatively that the branch officers acted as agents of the union for the purposes of section 109(2). The tribunal correctly applied Kemeh and Heatons Transport to conclude that branch officers had authority, express and implied, to act on behalf of the union in dealings with members and employers, and that the union could be liable for acts done within that authority (see paras [40]; [43]–[59]; [52]–[57]). Consequently the union was liable for sexual harassment by its elected officers.

(3) On the question whether paid union officers (investigators/decision-makers) themselves committed harassment or direct discrimination by failing to act and by transferring the claimant, the ET applied an incorrect legal test. For direct discrimination the tribunal must focus on the decision-maker's own mental processes and ask whether the treatment was because of sex (see paras [82]–[89]). Thus findings premised on a mere 'taint' from others' conduct were legally flawed and must be remitted unless only one result was possible (paras [85]–[90]).

(4) For harassment under section 26 the tribunal must identify the alleged perpetrator's conduct and ask whether that conduct was related to the protected characteristic. It is not enough that prior conduct by third parties was related to sex; the decision-maker's own conduct must itself be related to sex (paras [96]–[105]). The ET therefore erred and the harassment findings against the paid officers are remitted for rehearing.

(5) The ET was entitled to find that the transfer and resulting resignation could violate the claimant's dignity and create a hostile environment; that factual conclusion stands (paras [106]).

(6) The cross-appeal under section 64(2)(f) of the Trade Union and Labour Relations (Consolidation) Act 1992 was dismissed. Section 64 is concerned with discipline related to union membership and does not cover decisions relating to the employment of a paid officer (paras [110]–[115]).

(7) Orders: The ET's finding that the elected officers were employees is set aside. Findings concerning liability of the paid officers for harassment and direct discrimination are remitted to the ET for reconsideration. Other parts of the ET decision are upheld. The EAT indicated a presumption to remit to the same ET constitution subject to parties' submissions (para [117]).

• Employment Appeal Tribunal: Appeal from Employment Tribunal upheld in part; judgment handed down 27 September 2016. (This judgment)
• Employment Tribunal (Watford): Judgment for claimant upheld in part, decision originally handed down 1 July 2015; findings included sexual harassment and constructive dismissal (remitted in part by EAT).