Can employers be held liable for the actions of third parties?

24 April 2023

Background

The Equality Act 2010 brought together various anti-discrimination laws and consolidated them into one single Act. It provides a legal framework to protect the rights of individuals and advance equality of opportunity for all. In the employment context, claims for discrimination and harassment at work can be brought against private individuals and employers, and employers can be held vicariously liable for the actions of their employees. However, it is worth noting that employers cannot be held liable for the actions of third parties.

What is harassment?

Generally, it is any unwanted conduct that violates someone’s dignity, creates intimidation, hostility, fear, humiliation, or is degrading. These can arise from conduct or behaviour, pranks, spoken words, facial expressions, or gestures.

In 1994, two waitresses successfully brought harassment claims against a third party. They were subjected to racist and sexist jokes by an entertainer who was hired to entertain guests at an all-male dinner. But in 2003, the House of Lords (now the Supreme Court) reversed that decision and declared that a school was not liable for the harassing behaviour of a pupil towards a teacher. They took the view that pupils were not employees, acting in the course of their employment, or acting as agents of the school, and therefore not covered by the legislation.

In Mallet-Ali v Perth and Kinross Council, the claimant teacher described herself as having a Pakistani background but Scottish nationality. She was subjected to vile racist comments and taunts by students. This was generally accepted as racially motivated harassment. But, due to the current laws, she had to show that the school had acted unreasonably towards her by the manner in which they handled these complaints. This could not be done, and her claim failed.

This shortcoming was addressed when the EA 2010 was introduced with a provision that held employers liable for third-party harassment. But, the effectiveness was weakened because such claims could only be made if (1) there had been two previous incidents, (2) the employer was aware of those incidents, and (3) the employer failed to take reasonable steps to prevent repetition. But this was repealed in 2013.

The Worker Protection (Amendment of Equality Act 2010) Bill

The concept of employers' vicarious liability for third-party harassment will once again be included under the proposed legislation. In contrast to the previous system, the new one will instantly impose vicarious accountability upon the commission of any harassment. But, if the employer can demonstrate that they took every precaution to stop the harassment, they will be entitled to fight the claim. It's expected that the Equality and Human Rights Commission will introduce a formal Code of Practice defining the steps that businesses must take to uphold their obligations.

Employers and educational institutions alike must begin planning how they will meet the new regulations. Quest can assist you in comprehending your responsibilities and also advise you on the practical measures companies can take to become compliant. Schools and other employers ought to develop, review, and update their conduct and grievance procedures, consult with staff, and foster an atmosphere where employees feel free to voice their concerns.

 

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