Third-party harassment - action points for employers

Author: Tina Elliott

Third-party harassment has had a chequered history under the law. Here, employment judge Tina Elliott looks at the legislative background, the current position and the steps employers can take to protect their staff and themselves.

The background

Prior to the Equality Act 2010, one of the leading cases in this area was Burton and Rhule v De Vere Hotels [1996] IRLRL 596, sometimes known as the "Bernard Manning case". Bernard Manning was a comedian who was booked to perform at a hotel. His act included racist terminology which was offensive in particular to two black employees working at the event. The Employment Appeal Tribunal (EAT) found that the hotel was liable to those employees because it had not done enough to prevent the harassment, which was found to be sufficiently within its control.

However, the House of Lords held that this case had been wrongly decided in Pearce v Governing Body of Mayfield Secondary School [2003] UKHL 34. Following further debate in the courts, the Sex Discrimination Act 1975 was amended to include employer liability for third-party harassment. 

When the Equality Act 2010 came into force, third-party harassment was covered by s.40(2-4). It had to be shown that:

• the employer had failed to take reasonably practicable steps to prevent the harassment; and
• there had been two previous incidents of harassment that the employer knew about. It did not matter whether the third party was the same or a different person on each occasion.

The Coalition Government took the view that this carried employer liability too far, which led to the repeal of those subsections in October 2013.

The current position

As the law currently stands, there is no freestanding liability for third-party harassment. The effects of the repeal were considered in Unite the Union v Nailard [2018] IRLR 730 CA, where the Court of Appeal said: "the 2010 Act, for better or for worse, no longer contains any provision making employers liable for failing to protect employees against third-party harassment as such, though they may of course remain liable if the proscribed factor forms part of the motivation for their inaction"; and "the availability of third-party harassment is a matter for Parliament, and the policy decision effected by the 2013 Act must be respected".

In Bessong v Pennine Care NHS Foundation Trust [2020] IRLR 4, a mental health nurse was racially abused by a patient. It was found that although the abuse from the patient was racial in nature, this played no part in the employer's subsequent actions and the nurse's claim for harassment failed. The EAT commented that liability for third-party harassment had "much to commend it", but, "desirable as such liability might be", there was no such obligation as the law currently stood.

In what ways can an employer still be liable?

In the case of BDW Trading Ltd v Kopec EAT/0197/19, the employee, a concierge at a block of flats, was subjected to racial and homophobic abuse by delivery drivers. The employee claimed that his employer's failure to take seriously and investigate the abuse amounted to further harassment. If a tribunal finds that the failure was because of the employer's own discriminatory motivation, they can potentially be liable for harassment on their own account.

Accommodating discriminatory requests from customers or clients could also lead to a finding of direct discrimination. Take an example from the casino sector, where a patron might request that they be given a dealer who is white and female. If the employer accedes to that request and so prevents a non-white female dealer from going on shift, it might result in a finding of direct race discrimination.

If an employer is aware that third-party harassment is taking place and fails to take steps to prevent it, this could also risk a personal injury claim for any harm caused, if this was reasonably foreseeable and they had negligently failed to address it. In addition, failure to address a reasonably foreseeable risk of third-party harassment could potentially give rise to a constructive dismissal claim.

The Worker Protection (Amendment of Equality Act 2010) Bill

The Worker Protection (Amendment of Equality Act 2010) Bill is currently making its way through Parliament. In its initial form it sought to re-introduce third-party harassment, which takes place when a worker is harassed by someone they come in contact with through their job, such as a customer, client or supplier, rather than a co-worker. Under the provisions, employers would have been liable if they failed to take all reasonable steps to prevent the third party from committing harassment related to a protected characteristic.

In the event, the provisions were dropped during the Bill's passage through the House of Lords. Among the reasons given were concerns around free speech, and the likely impact on relationships between businesses and their customers and the difficulty in policing everyday interactions between them.

However, the Bill in its current form will create a new duty on an employer to take reasonable steps to prevent sexual harassment of employees. It will not come into force until one year after the Act is passed, which is expected to happen in 2023.

In addition, the debate in the House of Lords indicated that a future Labour Government might return to the issue.

What should employers do?

Risks remain if employers fail to take action on complaints about discriminatory conduct by third parties or if they accede to their discriminatory requests. The steps that need to be taken will be sector-specific and include:

• placing notices in the workplace on the standards of behaviour expected of customers or clients;
• training staff in how to deal with incidents of third-party harassment;
• making sure that grievances or complaints about third-party harassment are addressed promptly; and
• keeping an eye out for a possible new statutory code of practice from the Equality and Human Rights Commission (EHRC) on workplace harassment.

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