Decision at first instance in the employment tribunal
Indirect sex discrimination occurs when:
- An employer A applies a provision, criterion or practice ('PCP') to an employee B.
- The employer A applies (or would apply) that PCP to employees not of the same sex as employee B.
- The PCP puts or would put persons of employee B's sex at a particular disadvantage.
- The PCP puts or would put employee B at that disadvantage.
- The employer A cannot justify the PCP by showing it to be a proportionate means of achieving a legitimate aim.
The tribunal agreed that had the PCP been applied to the Claimant it would have put women at a disadvantage (because of issues with childcare) and it would not have been justified.
However, the tribunal concluded that the PCP of requiring fully flexible working (because Lacoste wanted her to work 4 days on fully flexible basis) had not in fact been applied to the Claimant (as she had asked for reconsideration at a point in time when she was not required to work) and she had not suffered a disadvantage. The Tribunal relied on an earlier EAT decision (Little v Richmond Pharmacology Ltd ) which had found that an employee had not suffered indirect discrimination when her flexible working request, although initially rejected, was allowed on appeal after she had already resigned while still on maternity leave. An important factor in that decision was the fact that the original decision (in response to which the Claimant had resigned) was expressly stated to be subject to appeal.
The Claimant appealed.
EAT decision
The EAT confirmed that Little is authority for the fact that the determination of a flexible working application can constitute the application of a PCP for indirect discrimination purposes, regardless of whether the employee returns to work or tries to work under any new arrangement. In this case (unlike in Little), the Claimant's appeal had been determined in full following the appeal outcome. The PCP had therefore been applied to the Claimant (notwithstanding that she had not yet returned to work under the working terms offered by the appeal outcome).
The matter was sent back to the tribunal to determine whether the Claimant was subject to a disadvantage by the application of the PCP (although the EAT indicated it was hard to see how she had not been disadvantaged given the appeal decision was determined against her and she had to consider resigning). As the Claimant continued to work, she would not be eligible for compensation for loss of earnings, but the nature of the disadvantage suffered would be relevant to assessing the injury to feelings.
What does this mean in practice for handling flexible working requests?
This decision really underlines the importance of properly and fairly considering flexible working requests (including the risk of indirect discrimination claims) inside of the flexible working process itself. Once you have determined the matter (certainly following appeal), then you will have been deemed to have applied the PCP of requiring the employee to work in a certain way (often less flexibly than they would want). Changing your mind when challenged further/later does not 'vanish' the actionable disadvantage already suffered by the employee, even where they have not yet returned to work.
It is sensible to make sure that any initial decisions on flexible working applications are expressly stated to be a provisional decision which is subject to appeal (this might help you to defend a claim for discrimination based on the decision in the first stage).
Where the reservations that you have about a flexible working request are not all that strong and/or evidenced, it is always worth considering whether it is workable enough to at least run as a trial period. Trial periods can be great for either putting concerns to bed where flexible arrangements do in fact work fine in practice, or conversely giving solid evidence of the flexible arrangement not working (enabling you to bring it to an end on notice as agreed with the employee at the outset of any trial period).
However, even where you think you may have made the wrong call after appeal, you can still improve your position by rowing back on it, as doing so will likely have a positive impact on any compensation awarded should the employee bring a claim for indirect discrimination (plus you might find you keep the employee, and the arrangement works).
The future is flexible
Flexible working is a growing trend both in practice and in terms of legislative change.
Those companies who took part in the world's largest trial of a four-day working week have reported very positive results; of the 61 companies who trialled the four-day week for six months, 56 have extended the four-day week, including 18 who have made it permanent. In the wake of those results, Sainsbury's has recently announced that they have offered store managers and workers based in its head offices and warehouses the option to work their full-time hours in four days a week (including weekend or longer weekday working if they wish).
The Government has also announced an intention to bring in new legislation to extend flexible working, which will make the right to request flexible working a day one right, will allow employees to make two statutory requests in a 12-month period and will require a much quicker response from employers (two months for the whole process including appeal rather than three months). It will also require greater emphasis on communication with employees when considering requests, with the expectation that employers and employees work together to explore how flexibility can be achieved.
For more on flexible working, read our recent article on the Government's response to the consultation on making flexible working the default.
