In December last year, the Employment Appeal Tribunal handed down its judgment in Steer v Stormsure Ltd UKEAT/0216/20/AT (V) which held that the failure of Parliament to grant a right to claim interim relief in claims of discrimination/victimisation dismissals was incompatible with Articles 6 and 14 of the European Convention of Human Rights (“ECHR”).
The case itself has the potential for providing discrimination/victimisation claimants with a powerful new weapon which may encourage employers to settle claims, given the costs of defending an interim relief application and the risk of having to continue paying the claimant for what could be a lengthy period until the full hearing, without any ability to recover those sums.
What is interim relief?
Interim relief is a type of remedy available for claimants in certain automatic unfair dismissal cases where claimants have been dismissed for a specified statutory reason, including blowing the whistle. The application must be made within 7 days of dismissal and the default position under the tribunal rules is that no oral evidence will be heard. There is a particularly high threshold to be met should the order be granted in favour of the claimant, whereby it must be shown that the claimant “has a pretty good chance “of success on the merits of the case.
Should this remedy be granted, the tribunal can order reinstatement or re-engagement. If the employer refuses, or if the employer offers re-engagement which the claimant reasonably refuses, the tribunal will make an order for continuation of the contract of employment between the parties for the duration of the proceedings or until the claim settles. In those circumstances the claimant is entitled to be paid their wages and receive all other benefits under their contract but without the need to carry out any work. If the claimant wins their case the payments are taken into account for the purposes of assessing damages arising from breach of the relevant statutory right, but if they lose their case, they are not required to pay anything back.
The facts of the case
Mrs Steer was an employee of Stormsure Ltd for a period of 4 months. During such time, she alleged that she had been subjected to sexual harassment by a fellow employee and that her employer was responsible because it had allegedly failed adequately to protect her. She had presented a grievance which she said was not adequately investigated and she had also requested to work from home to safeguard herself from further alleged harassment. She was permitted to work from home, but only on the basis that she installed screen shot monitoring software. She was then given a unilateral instruction that her working hours were to be reduced by 40% from 14 July 2020 allegedly because of her childcare responsibilities. No findings of fact have yet been made in this case and there are major disputes of fact between the parties, which have yet to be resolved. The case has been stayed pending the outcome of the appeal on a pure point of law, as discussed below.
The claims in the Employment Tribunal (the ET)
Mrs Steer left, claiming that the unilateral change to her working hours was either an express or a constructive dismissal and that her dismissal amounted to sex discrimination and victimisation for bringing the grievance and requesting to work from home. In the alternative she alleged that her dismissal was for making a protected disclosure and was therefore automatically unfair contrary to s103A. Steer proceeded to present a claim for interim relief at the ET on 30 July 2020 in respect of her sex discrimination and victimisation claims, as well as her whistleblowing claim. The Employment Tribunal listed an urgent interim relief hearing only in relation to the whistleblowing claim and stated that the Employment Tribunal did not have jurisdiction to grant interim relief for the discrimination and victimisation claims. Subsequently the claimant withdrew her application for interim relief in relation to the whistleblowing claim, and also withdrew her application for reconsideration of the decision on the paper sift not to make provision for an interim relief hearing in respect of the discrimination/victimisation claims. These tactics meant that the EAT was required to consider whether an interim relief application could be brought in respect of discrimination and victimisation claims.
Preliminary Hearing in the EAT
At the preliminary hearing in the EAT, Mrs Steer relied on three grounds, namely that:
- The decision of the ET that it did not have the power to grant interim relief in discrimination and victimisation claims was an error of law. (a pure point of law)
- The ET erred in law in concluding that it had no jurisdiction to order interim relief in Equality Act 2010 claims without first hearing the claimant/appellant.
- The ET’s reasons for its decision were inadequate. (the procedural grounds)
The procedural grounds, (two and three) were dismissed, but the EAT granted permission to appeal on the first ground, on the basis that it was a point of law of general public importance.
EAT decision on the preliminary issue
The appeal in the EAT was heard on an expedited basis since it raised complex questions of EU law and the potential declaration of EU-derived rights, namely that the non-availability of interim relief in discrimination and victimisation claims:
- infringed the EU law principles of effectiveness and equivalence and, on those grounds, the right to seek interim relief should be read into the domestic law statutory framework;
- violated fundamental principles of EU law, which gave rise to a directly effective right by reason of horizontal direct effect; and
- amounted to a breach of Art. 14 (prohibition of discrimination) of the ECHR, when read with Arts. 6 (right to a fair trial) or 8 (right to respect for private and family life), or Art. 1 of Protocol 1 (protection of property).
As such, the EAT was compelled to reach a decision before the expiry of the EU-transition period, since EU law only applied in the UK until 31 December 2021. The claimant was therefore seeking judicial recognition before the end of the transition period of a right based on EU law (namely the Recast Equal Treatment Directive) and for an interim remedy which does not exist in UK domestic legislation for discrimination and victimisation claims, although it does exist for trade union rights, whistleblowing and other cases.
EU law leaves it up to member states to decide on the procedural rules and remedies to safeguard EU rights subject to two important principles, namely that domestic UK law remedies must comply with the principles of effectiveness (meaning providing an effective remedy) and equivalence (meaning that the remedy is no less favourable than those which apply to similar actions of a domestic nature.)
In relation to the first ground of appeal, the EAT held that the remedies available in discrimination/victimisation complaints in the UK (i.e. excluding the right to interim relief) do comply with the principle of effectiveness. It also found that for these purposes a “similar action” of a domestic nature to a discrimination/victimisation claim arising from dismissal, ( which Mrs Steer’s claim is) would be a claim under section 103 A for automatic unfair dismissal where the principal reason for the dismissal is the making of a protected disclosure, but that taking the remedies available as a whole that apply to discrimination and victimisation claims, they were no less favourable than those that apply to claims under the domestic legislation for whistleblowing under s103A. It went on to find that even if it was wrong on that ( because for s103A claims there is a remedy of interim relief) the “no most favourable treatment Proviso” would apply because there was another “similar action” under domestic law, namely a claim for ordinary unfair dismissal, to which the interim relief remedy does not apply.
In relation to the second ground the EAT held that there was no breach of fundamental principles of EU law because UK domestic law does provide an effective remedy for discrimination and victimisation claims.
In relation to the third ground as regards to whether the failure to allow an application for interim relief in discrimination /victimisation claims arising from dismissal, infringes the European Convention on Human Rights, and whether it is possible to apply a conforming interpretation under the HRA 1998, the EAT held that Mrs Steer had an “other status” under Article 14 as an individual who wished to bring a claim of discrimination/victimisation arising from dismissal and that the matter came within the ambit of Article 6 because it related to judicial remedies for the enforcement of civil rights.
However the EAT found that a conforming interpretation was not possible “because it would cross the line between interpretation and quasi-legislation” and the EAT is not a court that has the power to make a declaration of incompatibility with the HRA. It nonetheless went on to consider whether in its view there had been a breach of Mrs Steer’s ECHR rights. In doing so, it considered it appropriate to look both at the question of whether claimants in discrimination/victimisation claims are in an analogous position to claimants who have been dismissed for making a protected disclosure, and if so, whether that difference is justified. In other words whether there are differences in the two categories of claims, which justify the availability of interim relief for one category and not the other? The EAT had no representations or written submissions before it from the Government, who chose not to intervene at this stage and the Respondent employer was not in a position to advance any explanation for the decision not to give a right to apply for interim relief to claimants such as Mrs Steer. The EAT declined to speculate on the reasons for the different treatment on the basis that it would be inappropriate to do so, but in the absence of a justification being put forward for the difference, went on to find that a breach of Article 14 (when read with Article 6) had been established. Nonetheless as the EAT could grant no remedy, it dismissed the appeal.
Permission to appeal to the Court of Appeal
Since it had found a breach of Article 14 which it was unable to remedy, the EAT granted permission to appeal to the Court of Appeal. That appellate court will have to consider whether the difference in treatment of discrimination/victimisation claimants, by denying them the right to interim relief is a breach of their ECHR rights which cannot be justified. If the Court of Appeal decides that it is, and grants a declaration of incompatibility leading to a change in the law extending interim relief rights to discrimination/victimisation claimants, it will ultimately change the landscape of discrimination legislation.
What does this mean going forward?
It must be hoped that the UK government will now take the opportunity to intervene, explain the aim behind the differing remedies available for differing categories of claimants and attempt to justify the difference as a proportionate means of achieving a legitimate aim. Unless and until it does, we, like the EAT are not in a position to properly evaluate the potential justifications for the difference. It is however informative to study the considerations put forward by Mr Justice Cavanagh at paragraphs 151 to 158 of the EAT’s judgment. These considerations included:
- broadening the remedies available in a subset of discrimination/victimisation claims relating to dismissal but not in other types of claims;
- widening the scope of who can apply for interim relief to apply to workers (where at the moment it is available only to employees);
- the increase in interim relief applications and the burden this would have on the employment tribunals;
- exposing employers to substantial, irrecoverable cost, when relief is granted but claims ultimately fail;
- opening up the possibility of interim relief being sought in multiple claims;
- the likely complexity of interim relief hearings relating to discrimination claims given that the ET has to consider the “pretty good chance” question in relation to all aspects of the claim, including for example the question of whether a potential claimant has a “pretty good chance” of establishing that they have a disability; and
- the effect of an extension to all discrimination/victimisation claims on the “balance of power” between employee/worker and employer.
Rise in Interim Relief Applications
Until then, interim relief is a limited remedy but a powerful one, as this judgment reminds us. We predict there may well be an uptake in interim relief applications, in the whistleblowing dismissal context, given the current hardship experienced by many employees as a result of the pandemic, greater difficulty finding new employment, and the scope for such whistleblowing claims based on dismissals arising from employees blowing the whistle concerning breaches of COVID-19 workplace health and safety obligations. Given that successful interim relief applications require an employer to provide a financial cushion for a dismissed employee pending their merits hearing and given that many Employment Tribunal hearings are not being scheduled until 2022, this could be an increasingly powerful weapon for dismissed employees and encourage employers to look at early settlements in order to crystalise their potential exposure.
If you are an employer facing an interim relief application relating to whistleblowing claims connected with claims of discrimination or victimisation and would like to discuss the defence of such claims and the protection of your business, or any other questions arising from this alert, or for specific legal advice on particular circumstances, please contact our Partner Merrill April, who specialises in employment and partnership issues for multinational employers, senior executives, partnerships and partners.
