Essop v Home Office (Border Agency)

The Supreme Court considered two consolidated appeals concerning indirect discrimination under the Equality Act 2010. The court held that under section 19(2)(b) and (c) claimants do not have to establish the reason why a provision, criterion or practice (PCP) puts a group sharing a protected characteristic at a particular disadvantage; it is sufficient to show that the PCP produces a disproportionate disadvantage to that group and that the individual claimant suffered (or would suffer) that disadvantage, subject to the respondent being able to show the PCP is a proportionate means of achieving a legitimate aim (section 19 and section 136 read together).

The court confirmed that statistical evidence is appropriate to establish disparate impact and that the necessary causal connection is between the PCP and the disadvantage to the group and to the individual, not between the reason for the group disadvantage and the protected characteristic. The court allowed the appeal in Essop (remitting the claims to the Employment Tribunal for determination in accordance with this interpretation) but dismissed Mr Naeem’s appeal, concluding that on the facts the Employment Tribunal’s approach to justification in the transitional pay-scale context did not disclose an error of law.

Background and parties. Two related employment discrimination claims were before the Supreme Court. In Essop, a group of Home Office employees challenged the requirement to pass a Core Skills Assessment (CSA) as a precondition for promotion, alleging that the CSA had a disparate impact on Black and Minority Ethnic (BME) and older candidates. In Naeem, a Muslim prison chaplain challenged the Prison Service incremental pay scheme as indirectly discriminatory because Muslim chaplains had, on average, shorter salaried service and lower average pay.

Procedural history. Both matters had passed through Employment Tribunals and the Employment Appeal Tribunal and were considered in the Court of Appeal: Essop came from [2015] EWCA Civ 609 and Naeem from [2015] EWCA Civ 1264. The Supreme Court heard consolidated argument on points of law concerning the interpretation of indirect discrimination under the Equality Act 2010.

Nature of the claims and relief sought. Both claimants sought declarations and remedies for unlawful indirect discrimination under section 19 of the Equality Act 2010 and relied on statistical evidence of disparate impact. The remedies sought were those available in employment law for discrimination (remission to tribunals for determination and appropriate relief where liability established).

Issues framed by the court.

• whether a claimant must prove the reason why a PCP puts a group at a particular disadvantage and that the individual’s disadvantage resulted from that same reason;
• how the relevant disadvantage should be defined (actual failure or increased likelihood of failure) and how the comparison pool should be identified;
• the role and standard of the burden of proof (section 136) and the respondent’s opportunity to justify the PCP as a proportionate means of achieving a legitimate aim.

Court’s reasoning and conclusions. The court traced the development of the indirect discrimination concept in domestic legislation and European directives, emphasising consistent features: no express requirement to identify the reason for disparate impact, the acceptability of statistical proof, and the distinction between direct and indirect discrimination. The court concluded that the legislative scheme requires a causal link between the PCP and the disadvantage to the group and the individual but does not require proof of the underlying causal explanation for the group disparity. Statistical evidence establishing disproportionate disadvantage is therefore sufficient to establish the group element; the respondent may then attempt to show justification by a proportionate means of achieving a legitimate aim. On the pool for comparison, the court endorsed selecting the group affected by the PCP. On justification in transitional schemes, the court recognised a particular factual inquiry: tribunals must consider whether there were practicable alternative means of achieving the legitimate aim that would reduce the disadvantage more quickly.

Disposition. The Essop appeal was allowed and remitted to the Employment Tribunal for determination in accordance with the correct legal approach. Mr Naeem’s appeal was dismissed because the Employment Tribunal’s conclusion on justification was a factual determination that did not disclose error of law and required consideration of possible alternative measures which had not been shown to invalidate the Tribunal’s conclusion.

The Supreme Court allowed the Essop appeal and remitted the claims to the Employment Tribunal because section 19(2)(b) and (c) do not require claimants to prove the reason for the group disadvantage; it is sufficient to show that the PCP causes a disproportionate disadvantage to the group and that the individual suffered that disadvantage, subject to the respondent’s justification. In Naeem the court dismissed the appeal, holding that the Employment Tribunal had properly treated the incremental pay structure as the PCP affecting all chaplains and had not erred in its evaluation of justification on the facts.

The matters proceeded from Employment Tribunals to the Employment Appeal Tribunal (Essop: Langstaff J, UKEAT/0480/13; [2014] ICR 871; Naeem: UKEAT/0215/13/RN; [2014] ICR 472), then to the Court of Appeal ([2015] EWCA Civ 609 for Essop; [2015] EWCA Civ 1264 for Naeem). The Supreme Court heard the consolidated appeals and allowed Essop while dismissing Naeem ([2017] UKSC 27).