Third Party Harassment under the Equality Act to be repealed
Under the Equality Act 2010 an employer could be vicariously liable for harassment by a third party (e.g., a customer or a contractor) if (1) the employer failed to take reasonably practicable steps to prevent the harassment and (2) the employer knew about at least two other occasions on which the employee had been harassed by a third party.
This provision will be repealed with effect from 1st October 2013.
What does this mean for employees who suffer harassment from third parties after 1 October?
It is probable that employees will have to rely on the legal position that pre-dated the Equality Act. If so, it may be more difficult for employees to hold their employers liable for third party harassment in future.
In 1997, the EAT ruled that a hotel was liable for subjecting its employees to an environment where sexual and racial harassment took place, despite the fact that the harassment itself originated from a third party. The test according to the EAT was whether the employer could control whether or not the harassment occurred.
However, in 2003 the House of Lords ruled that the EAT case was wrongly decided.
In the House of Lords case, a teacher was subjected to homophobic taunting and abuse by pupils at a school. The school was held to be not vicariously liable as the pupils were not its agents and the acts of harassment were not carried out by school staff. The House of Lords ruled that an employer is not liable to an employee in respect of sex (or racial) harassment of an employee by a third-party unless it failed to prevent the harassment for a reason related to the sex (or race) of the employee.
The effect of the House of Lords’ ruling is that while an employer's failure to prevent third parties committing acts of sexual/racial harassment can amount to discrimination by the employer, it will only do so if the employer failed to take preventative steps because of the employee's sex/race. This is likely to restrict the number of cases in which employers can be held liable for harassment by third parties after 1 October.
If you would like advice about how the issues in this note apply to your situation, please contact Tony Brown on 01225 740097 or by e mail to firstname.lastname@example.org
Warning – this bulletin is for information only and does not claim to be comprehensive or to provide legal or other advice. You should take legal advice before taking or refraining to take any action. No liability is accepted for loss that may arise from placing reliance on this bulletin.