Base Childrenswear Ltd v Otshudi - Race discrimination: injury to feelings

Employment Appeal Tribunal – May 2019

The Employment Appeal Tribunal (EAT) has ruled that a one-off act of discrimination does not limit tribunals to making an award in the lower Vento band for injury to feelings compensation.

In the case Vento v Chief Constable of West Yorkshire Police, guidelines were given on how an employment tribunal (ET) should determine the amount of money to be awarded for injury to feelings in successful discrimination claims. As a result, the Court of Appeal in Vento set out three bands to be used when assessing injury to feelings:

  • less serious cases, such as a one off event that was not extremely serious
  • serious cases, such as ongoing discrimination
  • very severe cases, such as prolonged discrimination or repeated harassment over a period of time.

Compensation for discrimination claims remain unlimited and tribunals can award more than the upper limit provided in the Vento bands in exceptional cases.  

The Acas Code of Practice on Disciplinary and Grievance Procedures provides practical guidance and sets out principles for handling grievances in the workplace. A failure to follow the code's recommendations will not, on its own, make an organisation liable to legal proceedings. Tribunals will, however, take the code into account when considering relevant cases.

FACTS

This case concerned an employee who was dismissed after three months of employment. In a meeting with two other members of the management team, the organisation’s managing director attempted to outline that this was due to her being made redundant, something that he would later admit to the employment tribunal (ET) was untrue. Immediately seeing through this, the employee questioned why she was being dismissed and if it was to do with her race. The managing director challenged her to claim this was a case of discrimination. He then told her to leave immediately.

The employee submitted a letter of grievance and an appeal against her dismissal but these were not responded to. She later brought numerous claims to the employment tribunal, including that she had been subjected to racial harassment during her dismissal.

ET

The ET dismissed most of her claims as they were brought out of time, however, they did uphold her further complaint of racial harassment in respect of her dismissal.

The ET reasoned it was very clear that the employee had been aware she was the victim of wrongdoing and that she was being placed under pressure not to question it. They also called into question the subsequent actions of the organisation following the bringing of her claim as they had admitted to lying about the redundancy and later tried to outline that they suspected her of theft, something that the ET viewed with ‘considerable scepticism.’ They were therefore satisfied that her dismissal amounted to unwanted conduct, was intimidating and a violation of her dignity.

At a later remedy hearing, the tribunal awarded the following to the employee:

  • injury to feelings compensation of £16,000, which fell in the middle Vento band
  • aggravated damages of £5,000 due to the organisation’s failure to respond to her grievance or appeal, their lies in regard to the false redundancy and unsubstantiated accusation of theft, and their failure to apologise
  • personal injury award of £3,000 due to the employee’s subsequent depression
  • uplift of 25 per cent for failure to follow the Acas Code of Practice by not responding to the employee’s grievance and appeal.

The organisation appealed to the Employment Appeal Tribunal, arguing that the awards were ‘manifestly excessive’ and had applied the wrong Vento band. They also stated that the ET had double-counted some of the factors at the remedy hearing.  

EAT

The EAT dismissed the appeal in the most part, primarily agreeing with the reasoning of the ET.

They outlined that the fact the discrimination had been a one-off act (they were not able to consider the other acts claimed) did not limit the employment tribunal to the lower Vento bracket. This is because the bands are not prescriptive and such awards will always be fact specific. The question that will be focussed on is what effect the discriminatory act has had on the claimant. Whether it was a one-off act or a course of conduct are relevant facts but not determinative.

The EAT did agree that the ET had erred by taking into account the organisation’s failure to follow the Acas Code of Practice in respect of the aggravated damages award and also the 25 per cent uplift. They therefore reduced the aggravated damages award by £1,000.

Note for employers

The case presented here is a useful commentary on how tribunals will approach Vento banding. It is not as clear cut as simply stating that one act of discrimination should only be given the lower band’s compensation; they will assess the full situation and its impact on the employee.

This case also reminds organisations of the importance of the Acas Code of Practice. By following the code, organisations can help to avoid potential claims being brought at a later date whilst also having clear guidelines to assist them in the best methods for handling a situation such as a post-employment grievance.

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