Saad v Southampton University Hospitals NHS Trust

Bad faith under section 27(3) of the Equality Act 2010 primarily tests the honesty of the maker of a false allegation.

Motivation or collateral purpose may be relevant context but will not by itself establish bad faith.

An Employment Tribunal must therefore decide whether the claimant acted dishonestly when making the allegation; a subjective honest belief in its truth negates bad faith.

The claimant, a trainee surgeon, raised a grievance alleging a consultant made a racist remark. The Employment Tribunal rejected his protected disclosure claims and found his belief unreasonable and that he had an ulterior motive. The ET read that finding across to reject a victimisation claim under section 27(3) Equality Act 2010, treating the allegation as false and made in bad faith.

The claimant appealed on the narrow point that the ET had applied the whistleblowing "good faith" test to the separate "bad faith" exception in section 27(3).

The Employment Appeal Tribunal allowed the appeal, finding the ET had applied the wrong statutory test and that, on the ET's express finding that the claimant subjectively believed the allegation, bad faith was not established.

1. The appeal is allowed. The Employment Tribunal erred in law by importing the "good faith" test from the public interest disclosure provisions of the Employment Rights Act 1996 into the "bad faith" exception of section 27(3) Equality Act 2010. (See paras [Introduction]; [Discussion and Conclusions]).
2. The statutory contexts differ. The whistleblowing provisions required a prior assessment of reasonable belief and a separate enquiry into good faith. Section 27(3) requires, once falsity is established, an enquiry into whether the allegation was made in bad faith. The core meaning of bad faith in that context is dishonesty. Motivation is contextual but secondary to honesty. (See paras [The Relevant Statutory Provisions and Guidance from Case Law]; [Discussion and Conclusions]).
3. An Employment Tribunal must therefore ask, once an allegation is found false, whether the claimant knowingly or dishonestly made the allegation, or was wilfully reckless as to its truth. Collateral motives may assist that assessment but do not substitute for a finding of dishonesty. (See paras [Discussion and Conclusions]).
4. On the findings actually made by the Tribunal below the claimant subjectively believed the allegation to be true. That finding is sufficient to negativate bad faith. The claimant's victimisation complaint therefore succeeds as to the decision refusing his return to the CTU. The ET's dismissal of that complaint is set aside. The matter is remitted to the ET to determine remedy if parties cannot agree. (See paras [Discussion and Conclusions]; [Outcome/Remittal]).

• Employment Appeal Tribunal Allowed the appeal; set aside part of the ET decision and remitted remedy. (Full Hearing; HHJ Eady QC) (22 August 2018).
• Employment Tribunal (Southampton) Reserved judgment dismissed the victimisation complaint; Employment Judge Bridges (24 April–4 May 2017; reserved judgment sent 8 June 2017).