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Employment Update for Small Businesses
April 2022

Dear Subscriber

This month we look at the law on discrimination and in particular the compensation that can be made in successful discrimination claims for “injury to feelings”.
Please contact me if you would like to find out a bit more about any of the subjects raised in this update or if you need any help or advice.

Please forward this email to any of your contacts who might find it of benefit.

Peter Etherington
Tel: 01664 668164


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Peter Etherington
Unlawful Discrimination
A brief summary of the law
Employees (and job applicants) are protected against unlawful discrimination under the Equality Act. This covers discrimination in relation to the following “protected characteristics”:

  • Sex
  • Sexual Orientation
  • Race
  • Religion or belief
  • Gender reassignment
  • Age
  • Disability
  • Pregnancy and maternity
  • Marriage and civil partnership

Direct discrimination is rare, as that means treating someone less favourably or dismissing them because of a protected characteristic (PC) (e.g. sacking a woman because she is pregnant) and most employers would just not act in that way. However, employers can be liable for direct discrimination carried out by other employees, which is why it is so important to act quickly to tackle any discrimination in the workplace.

Indirect discrimination is more likely to occur and may be unintentional on the part of the employer. That means putting in place a provision, criterion or practice (PCP) which is less favourable for someone with a PC and which cannot be objectively justified. For example, insisting that customer-facing staff must be clean shaven could disadvantage Muslim men, who may have a beard on religious grounds. An example of a PCP that is likely to be objectively justified (and is therefore not unlawful), is the need for construction workers to be able to climb scaffolding. Clearly that would disadvantage people with a range of physical disabilities, but as there is unlikely to be any alternative way of working that could accommodate such disabilities, it is likely to be lawful.

Harassment is another type of unlawful discrimination. This is unwanted conduct by an employer or their staff, relating to a PC, which has the purpose or effect of violating someone’s dignity or which creates an intimidating, hostile, degrading, humiliating or offensive environment for someone with a protected characteristic. That could include “banter” which the recipient finds offensive; sharing or displaying pictures of semi-clad models in the workplace; patronising behaviour relating to sex or age; etc.

Victimisation is also a form of unlawful discrimination, which means treating someone less favourably or dismissing them, because they may be taking action under the Equality Act or supporting someone who is doing so.

Unlawful Discrimination
If an employee is unfairly dismissed in circumstances in which they have been unlawfully discriminated against, then the normal rules regarding unfair dismissal compensation apply. That is a basic award (similar to a statutory redundancy payment, based on age and length of service) and a compensatory award which compensates them for loss of earnings due to the unfair dismissal (capped at a year’s pay or £93,878, whichever is lower). Often a small award of about £300 is applied to compensate for the fact that they need to acquire two years’ continuous service with their next employer before they can again receive the statutory protection against ordinary unfair dismissal.

However, there is an additional award of injury to feelings that will also apply in discrimination cases. This would also apply in discrimination cases that do not involve dismissal.

The injury to feelings award is intended to compensate the individual for the damage caused emotionally by the act(s) of discrimination – i.e. upset, distress and anxiety. The amount of this award is unlimited and uncapped. In theory, therefore, it could run into millions of pounds. It varies according to the damage caused, so it reflects the seriousness of the act of discrimination. Therefore, where someone had been treated less favourably through a PCP and where the less favourable treatment was inadvertent and quite minor, the compensation may be very low. Whereas, in a case of serious sexual harassment conducted by a senior manager on a low level, vulnerable employee over a protracted period, the compensation is likely to be a lot higher.

Since 2002, tribunals have followed the guidance set out by the Court of Appeal in the case of Vento v Chief Constable of West Yorkshire Policeusing a system of bands depending on the damage caused. These are known as the Vento Bands and in recent years have been increased on an annual basis to keep pace with inflation. For claims presented on or after 6th April 2022, the bands are:

  • Lower band: £990 to £9,900 (for less serious cases)
  • Middle band: £9,900 to £29,600 (for cases that don’t merit an upper band award)
  • Upper band: £29,600 to £49,300 (for the most serious cases)

Exceptional cases may exceed the upper limit of £49,300.

Unlawful Discrimination
How to avoid claims
A starting point for any employer is to have clear policies on equality and harassment, and to ensure that you live by them. At the very least, we advise you ensure staff are made aware of the polices and standards of behaviour expected from them, and that discrimination is not tolerated.

Take swift action if you become aware of any conduct that could touch on unlawful discrimination and don’t wait for a formal complaint to be made. If someone acts in a directly discriminatory manner towards a colleague (e.g. using racial or sexual language), then their behaviour is likely to be considered gross misconduct and it would normally be appropriate to dismiss them (having followed a reasonable procedure). If you are aware of someone who has a tendency to act in a manner towards, for example, women or younger staff members, in a manner that could be considered patronising, then step in and deal with it in an informal but firm manner, and explain why it is inappropriate. Such behaviour could amount to harassment. For example, an older male employee who flatters younger female staff about their appearance in a manner that may make them feel uncomfortable.

Review any policies, criteria or practices you have to check if they may have an adverse impact on any particular groups of staff, to try to avoid inadvertent indirect discrimination.

Consult staff whenever considering introducing new policies or working practices, to try to ensure you do not introduce any that may be indirectly discriminatory.

Contact us for advice if you receive any complaints of discrimination so we can help you address them in a manner that may resolve the issue and help avoid a claim.

National Minimum and Living Wage
From 1st April 2022, the minimum wage bands are increasing:

  • to £9.50 per hour (from £8.91) for workers aged 23 and over (+ 6.6%)
  • to £9.18 per hour (from £8.36) for workers aged 21 to 22 (+ 9.8%)
  • to £6.83 per hour (from £6.56) for workers aged 18 to 20 (+ 4.1%)
  • to £4.81 per hour (from £4.62) for workers aged 16 and 17 (+ 4.1%)
  • to £4.81 per hour (from £4.30) for apprentices under 19 and those over 19 in their first year* (+ 11.9%)

*N.B. Apprentices over 19 and who have completed at least one year are entitled to the appropriate rate for their age.