Virgin Active Limited v C Hughes

The Employment Appeal Tribunal allowed the appeal in part. The Employment Tribunal erred in its discrimination analysis by treating the claimant's three colleagues as actual comparators without analysing whether there were material differences between their circumstances and the claimant's, and thereby incorrectly concluded that the burden of proof under section 136 of the Equality Act 2010 had shifted to the respondent. The Employment Tribunal did not err in its protected disclosure (whistleblowing) analysis under sections 43A–43C of the Employment Rights Act 1996: it was open to the tribunal to find that two qualifying disclosures were made, that the claimant reasonably believed they were in the public interest, and that the disclosures influenced the decision to dismiss. The allegations of perversity failed and the delay in promulgating the Employment Tribunal's judgment, explained largely by the judge's serious ill health, did not create a real risk that the respondent was deprived of the substance of a fair trial.

Background and parties: The claimant joined Virgin Active in 2012 and rose to become Mayfair Club manager. Following internal investigations and grievances involving three employees (Jannett George, Roya Arasp and Darrell Giovanni) the claimant was suspended, disciplined and summarily dismissed in September 2017. The claimant brought claims to the Employment Tribunal for direct race discrimination, age and sex discrimination, ordinary unfair dismissal and automatic unfair dismissal arising from protected disclosures. The Employment Tribunal (Judge Professor A C Neal and members) found for the claimant on direct race discrimination, ordinary unfair dismissal and automatic unfair dismissal (protected disclosure) but dismissed age and sex discrimination claims.

Procedural posture: The respondent appealed to the Employment Appeal Tribunal on multiple grounds including excessive delay in promulgating the Employment Tribunal judgment, perversity, alleged bias (abandoned), errors in the legal test for race discrimination and errors in the public interest disclosure analysis. The Employment Tribunal judgment was dated 15 June 2021; this appeal was heard by the EAT and handed down on 16 October 2023.

Nature of the claim and relief sought: The claimant sought declarations and remedies for discrimination and unfair dismissal, including automatic unfair dismissal for whistleblowing. The respondent sought to overturn the Employment Tribunal's adverse findings.

Issues before the EAT: (i) whether delay in promulgating the tribunal decision had deprived the respondent of the substance of a fair trial (applying the Connex/Bangs approach); (ii) whether the Employment Tribunal applied the correct legal test when finding the burden of proof had shifted under section 136 Equality Act 2010 and whether it had properly analysed comparators under section 23 Equality Act 2010; (iii) whether the Employment Tribunal properly applied the test for qualifying/public interest disclosures under section 43B ERA 1996; and (iv) whether any conclusions were perverse.

Reasoning and outcome on the issues:

• Delay: The EAT applied the legal test from Connex South Eastern Ltd v Bangs: delay can only found an appeal where it gives rise to a real risk that the litigant was deprived of the substance of a fair trial. The judge's serious ill health and the steps taken by the tribunal (notes, recorded deliberations, iterative approach, availability of bundles to members) meant there was no real risk of deprivation of a fair trial. The delay therefore did not vitiate the decision.
• Race discrimination / burden of proof: The EAT held the Employment Tribunal erred in law by treating the claimant's colleagues as actual comparators without analysing material differences between the circumstances of the claimant and those comparators (see section 23 Equality Act 2010). The tribunal therefore wrongly concluded that the burden had shifted under section 136 and that the respondent had failed to discharge it. That part of the decision was set aside and remitted for rehearing.
• Protected disclosure: The EAT found no error in the tribunal's factual finding that the claimant made two qualifying disclosures (threats/personal safety and alleged direct-debit fraud), that he reasonably believed they were in the public interest, and that the disclosures influenced the decision‑makers. The tribunal's reliance on covert recordings to establish causal influence was lawful and not perverse.
• Perversity: The EAT rejected the respondent's perversity arguments — the high threshold was not met.

Disposition: The EAT allowed the appeal in part: it set aside the Employment Tribunal's findings of direct race discrimination and remitted those claims for rehearing by a different Employment Tribunal; it dismissed the remaining grounds of appeal.

Appeal allowed in part. The EAT held that the Employment Tribunal made an error of law in the race discrimination analysis by treating the three colleagues as actual comparators without analysing material differences and thereby wrongly shifted the burden of proof under section 136 Equality Act 2010. That part of the judgment was set aside and remitted for rehearing. The EAT upheld the Employment Tribunal's findings on protected disclosures under sections 43A–43C Employment Rights Act 1996, rejected perversity and bias arguments, and held that the delay in promulgating the Employment Tribunal's judgment did not create a real risk of deprivation of a fair trial under article 6, so the remainder of the appeal was dismissed.

Appeal to the Employment Appeal Tribunal from the Employment Tribunal (Judge Professor A C Neal sitting with members; Employment Tribunal judgment dated 15 June 2021). Decision of the EAT delivered as Virgin Active Limited v C Hughes [2023] EAT 130 (judgment dated 16 October 2023).