Looking for the Positives in Discrimination Law
Key Contact: Claire Knowles
Author: Mark Alaszewski
The CBI has recently announced that the largest UK firms should have at least one BAME member on their boards by 2021, with smaller firms to be similarly committed by 2024. In a recent announcement their Chairman Lord Karan Bilimoria, himself from an ethnic minority background, declared that:
“The time has come for a concerted campaign on racial and ethnic participation in business leadership. Progress has been painfully slow.”
Greater diversity at board level is a worthwhile goal. Currently more than one third of FTSEs companies do not have any ethnic minority representation at board level. Whilst we do not have statistics we can hazard a guess that the boardrooms of smaller companies and SME’s are even less diverse. The predominance of white men of a certain age at board level means that the senior leadership of our leading companies does not reflect the society we live in. This is not a healthy situation and is unlikely to result in good decision-making if attitudes and assumptions at board level do not reflect those within the wider community.
However, there are legitimate questions as to whether the type of fixed quotas apparently envisaged by the CBI are lawful or even desirable.
Dealing with the legal question first, it is generally unlawful under the Equality Act to discriminate on the basis of a protected characteristic in recruitment and promotion. By their very nature quotas involve positive discrimination because a particular individual is being selected for a board position because of their racial or ethnic background.
This is likely to constitute an act of less favourable treatment by omission to an otherwise better qualified individual from a different ethnicity who is overlooked for a board position again because of their racial or ethnic background. On the face of this would potentially be grounds for a direct discrimination claim.
The Equality Act does allow ‘positive action’ in limited circumstances where socially excluded groups are encouraged to access opportunities through targeted action. This could include advertising vacancies or providing training and work experience to particular groups and is lawful providing that any subsequent selection process does not directly discriminate. This is a fine line to draw and an employer must be able to objectively justify any positive action and so must have evidence which provides that participation from a particular group is disproportionately low.
Positive action can even extend to using a protected characteristic as a ‘tie-breaker’ between candidates within recruitment and promotion. This applies in the possible but unlikely scenario that there were two candidates who are ‘identically qualified’ for the same position. In these circumstances it would be lawful to make the selection on the basis of a protected characteristic and to give the post to the candidate from the more disadvantaged group.
The use of mandatory quotas as suggested by the CBI seems to go beyond the types of positive action which are permissible under the Equality Act 2010 and would almost certainly necessitate a change in the law. There are currently very limited circumstances in which positive discrimination of this nature does occur, for example, all female shortlists within the Labour Party. However, the application of positive discrimination to every boardroom in country would be a massive extension of this principle and one with potentially far reaching implications.
Whether it would be ultimately desirable is a difficult question. Quotas are a very blunt tool to address societal disadvantage and go against the principle of progress based on individual merit which is a fundamental building block of employment law.
It is also legitimate to ask why BAME status should be favoured above other protected characteristics such as disability and sexual orientation. Whilst London and some of the UK’s major cities have large BAME communities and work-forces, other parts of the UK do not. A company based in Plymouth would have very different challenges in implementing the CBI’s proposal to one based in Birmingham.
And what about social class? Social class isn’t a protected characteristic under the Equality Act but remains the dominant predictor of economic and social outcomes in the UK. It would be legitimate to question why a candidate from a wealthy BAME background should be favoured against a candidate from an economically disadvantaged but non-BAME background.
None of these questions seeks to diminish or trivialise the issue but they do show some of the complexities which would be involved in implementing the CBI’s proposal. Positive discrimination is a powerful tool but also a potentially divisive one that UK employment law has historically shied away from. There are a large number of ways in which BAME participation in the workplace could be improved which do not involve discriminating against others and may be a rather better option than the introduction of mandatory quotas.
For advice in relation to workplace discrimination or any aspect of employment law please contact our employment team.
Claire Knowles – Partner
Mark Alaszewski – Associate
Rebecca Mahon – Solicitor
Adam McGlynn – Solicitor
