Mruke v Khan

Direct racial discrimination requires comparison with a person whose relevant circumstances are the same as, or not materially different from, those of the claimant. The decisive question is whether the protected characteristic was the factual criterion for less favourable treatment, rather than the discriminator’s motive. Socio-economic vulnerability, even if associated with nationality or national origins, is not automatically inseparable from them.

For constructive dismissal, a statutory national minimum wage term is implied by law. The employee need not know of the entitlement or breach. Where an egregious repudiatory breach makes it obvious that resignation was in response, the necessary causal link may be inferred despite the absence of an express reason.

The Appellant was a Tanzanian domestic worker employed by the Respondent in the United Kingdom. The Employment Tribunal allowed claims concerning national minimum wage, holiday pay and rest breaks, but dismissed claims for direct and indirect racial discrimination, harassment and constructive unfair dismissal.

The Employment Appeal Tribunal dismissed the Appellant’s appeals against the discrimination decision and the constructive dismissal decision. The Court of Appeal considered whether the treatment was because of nationality or national origins, whether the burden of proof had shifted, whether ignorance of the national minimum wage affected constructive dismissal, and whether the Tribunal’s conclusion was perverse.

Lord Justice Singh gave the judgment. Lord Justices Hickinbottom and Patten agreed.

1. Direct discrimination. Under section 3(4) of the Race Relations Act 1976, the hypothetical comparator had to share the relevant circumstances of the Appellant, subject to there being no material difference. The comparator did not have to be British. The question under section 1(1) was whether nationality or national origins was the factual criterion for the less favourable treatment, not the Respondent’s motive. This approach was consistent with R (E) v Governing Body of JFS [2009] UKSC 15 and R v Birmingham City Council, ex p. Equal Opportunities Commission [1989] AC 1155.
2. The principle identified in Onu v Akwiwu and Taiwo v Olaigbe [2016] UKSC 31 assisted by analogy. Socio-economic circumstances such as illiteracy, lack of education and poverty were not inseparable from nationality or national origins. The treatment was attributable to those circumstances, not to a prohibited racial ground. Smyth v Croft Inns Ltd [1996] IRLR 84 was not analogous. The direct discrimination appeal therefore failed.
3. The operation of section 54A of the Race Relations Act 1976 was a matter of fact and degree, initially for the Employment Tribunal. The Tribunal had correctly directed itself by reference to Igen Ltd v Wong [2005] EWCA Civ 142 and Hewage v Grampian Health Board [2012] UKSC 37. It was entitled to conclude that the burden had not shifted.
4. Constructive dismissal. Section 17 of the National Minimum Wage Act 1998 implied a term by law that the national minimum wage would be paid. The failure to pay it was a fundamental and repudiatory breach. The Employment Tribunal erred by relying on the Appellant’s ignorance of that entitlement. The principles concerning repudiatory breach, resignation in response and the absence of any requirement to communicate the reason were stated in Western Excavating (ECC) Ltd v Sharp [1978] ICR 221, Nottinghamshire County Council v Meikle [2004] EWCA Civ 859 and Weathersfield Ltd v Sargent [1999] ICR 425.
5. This was a rare case in which the breach was so egregious, and the circumstances so clear, that the Appellant’s departure must have been in response to the repudiatory breach despite the absence of an express reason. The Employment Tribunal’s conclusion was perverse. The Court substituted a finding that the Appellant had been unfairly dismissed. The unfair dismissal appeal was allowed.

• Court of Appeal (Civil Division): In [2018] EWCA Civ 280, the appeal concerning direct racial discrimination was dismissed. The appeal concerning constructive unfair dismissal was allowed, and the Court substituted a finding of unfair dismissal.
• Employment Appeal Tribunal: The appeal against dismissal of the direct discrimination claim was dismissed. The later appeal against dismissal of the constructive dismissal claim was also dismissed.
• Employment Tribunal, Watford: Claims for national minimum wage, holiday pay and rest breaks succeeded. Claims for racial discrimination, harassment and constructive unfair dismissal were dismissed.