No inference from unfair treatment

In Glasgow City Council v Zafar (12 July 1996) EOR72C, the Court of Session rules that unreasonable treatment by an employer does not raise an inference of less favourable treatment.

The issues

Direct discrimination requires a showing that the applicant was treated less favourably than the employer treated or would treat others, and that the less favourable treatment was on grounds of race (or sex). The main issue in this case is whether it is legitimate to draw an inference of less favourable treatment from the fact that the employer has treated an employee unreasonably.

Abdur Zafar, who is of Asian origin, was employed by Strathclyde Regional Council as a social worker. He was dismissed on grounds that he had been involved in incidents of sexual harassment. He brought proceedings, complaining that his dismissal was unfair. He also alleged that he had been discriminated against on grounds of race in respect of his dismissal.

An industrial tribunal found that Mr Zafar had been guilty of sexual harassment "of the most distasteful and unacceptable kind". However, the tribunal held that the dismissal was unfair on procedural grounds, and that the employer's failure to adopt a fair procedure also constituted discrimination on grounds of race.

The tribunal found that the employer had delayed dealing with the allegations against Mr Zafar and had failed to advise him of the subject matter of the complaints. Moreover, Mr Zafar had not been warned in respect of an earlier incident, and if he had received such a warning, he might have "mended his ways" and the incident which resulted in his dismissal might not have occurred. The tribunal concluded that "the treatment accorded to the applicant by the respondents fell far below the standards of a reasonable employer in that they delayed unduly in dealing with the complaints against the applicant, failed to advise him of the nature of the investigation and 'dredged up' one complaint which no reasonable employer would have founded upon . . . To treat someone in a way which falls far below the standard of the reasonable employer gives rise to a presumption that that person has been treated in a way different from the way in which others have been, or would be treated. It is also clear that such departure from normal or reasonable standard constitutes less favourable treatment, so that the evidence discloses that the respondents have treated the applicant less favourably than they have treated or would treat others."

The tribunal went on to draw an inference that this less favourable treatment was on racial grounds. They directed themselves that: "once an applicant has demonstrated that (1) he is a member of a minority racial group, and (2) he has been less favourably treated than others have been treated, or would be treated, there is an onus on the employer to give an innocent explanation for the treatment accorded to the complainant (innocent, in this context, meaning an explanation not involving racist considerations). If no such explanation is offered, the industrial tribunal should draw an inference of race discrimination . . . In these circumstances, the tribunal have no choice but to draw an inference adverse to the respondents and find that the applicant has been discriminated against by the respondents within the meaning of s.1(1), because no satisfactory explanation justifying the treatment accorded to the applicant has been accepted by them."

The EAT dismissed the employer's appeal against the finding of race discrimination and unfair dismissal. The employer appealed the finding of race discrimination to the Court of Session.

Held (allowing the appeal and dismissing the discrimination complaint)

• The industrial tribunal had erred in finding that because the treatment accorded to the applicant fell far below the standards of a reasonable employer, he had been treated less favourably than the employer treated or would have treated others. It cannot be inferred, let alone presumed, only from the fact that an employer has acted unreasonably towards one employee, that it would have acted reasonably if it had been dealing with another in the same circumstances.
• The industrial tribunal had also misdirected themselves in considering that they had no choice but to draw an inference of discrimination on racial grounds once it had been established that the applicant was a member of a minority racial group, that he had been less favourably treated than others would have been treated, and that no satisfactory explanation for the unequal treatment had been given by the employer. If the tribunal had exercised the discretion which they ought to have exercised, they could not have inferred that the unfair treatment accorded to the applicant was accorded to him on racial grounds.

Implications

The essence of proof of discrimination is comparative evidence. It is legitimate for a tribunal to infer discrimination from an unexplained disparity in treatment between similarly-situated employees of different race. In such circumstances, the presumption is that employers do not act for totally arbitrary reasons, so that when legitimate reasons have been eliminated as the ground for the disparate treatment, it is reasonable to infer that the difference in treatment was based on grounds of race.

In such a case, King v The Great Britain-China Centre EOR41B, agreed with by the Court of Session in this case, holds that "it is legitimate" for a tribunal to draw an inference of discrimination, but they are not compelled to do so. This leaves the law in a less than satisfactory state. The conceptual justification why an inference of discrimination is not automatic when the employer's reason is unsatisfactory or is disbelieved is that even though there may be a bad reason for the employer's act, which the employer wishes to hide, that reason is not discriminatory. Yet, as the importance of giving race and sex discrimination legislation a purposive construction comes more to the fore (the latter stimulated by EC law considerations), it must be questionable whether the law should protect employers whose non-discriminatory reason is shown to be a pretext. The danger of the Zafar and King decisions in this respect is that tribunals may consider that they are precluded from making a finding in favour of a complainant, even where the employer's reason for less favourable treatment is discredited, without positive evidence that there has been discrimination on a prohibited ground, thereby imposing too high a standard of proof.

It is quite another matter, however, merely to infer discrimination on the basis of unexplained, unreasonable treatment of a minority employee, as the industrial tribunal appears to have done in this case. As the Court of Session rules, that begs the question of whether the complainant has been less favourably treated than anyone else. In order to meet this basic test of disparity, an applicant must show, in some way, that he or she has been treated differently or affected differently than other persons of a different racial group. It does not meet this test to show that someone who is black has received unfair treatment, unless, in some way, this was different from that received by whites.

It is true that there can be a hypothetical comparator for discrimination law purposes, but a hypothetical comparison cannot be preferred to evidence of actual behaviour. Where the issue is as straightforward as dismissal and the employer as large as Strathclyde Council, it seems strange that the applicant, on whom the burden of proof lies, was allowed to succeed at first instance without advancing any comparative evidence of disparity of treatment in the employer's handling of disciplinary proceedings.

On the reasoning of the industrial tribunal in this case, any minority employee who was unfairly dismissed would succeed in showing race discrimination as well. Indeed, since the Race Relations Act 1976 applies to members of the majority group as well as minorities, a finding of unfair dismissal would equate to a finding of race discrimination generally!