In this case, the Court of Appeal held that an employer had directly discriminated against an employee because of her race when it temporarily transferred her from her role and began a baseless disciplinary investigation against her.
Facts
Mrs Parmar, a British national of Indian origin with many years' experience in social work, was employed by Leicester City Council (the Council) as the Head of Service for one of the Council's service areas.
Responsibility for ensuring that the teams in each of the service areas cooperated lay with Mrs Parmar's line manager, Ms Lake. In January 2021, following some disputes between service areas, Ms Lake decided to begin a disciplinary investigation into Mrs Parmar, and to temporarily transfer her from her role. On 9 February 2021, Ms Lake invited Mrs Parmar to a disciplinary investigation meeting, which took place remotely on 19 February 2021 after Ms Lake had interviewed nine witnesses. The invitation alleged two general failures by Mrs Parmar, but did not give details of dates, particular conduct, people involved, or the provisions or standards she was said to have breached. A second investigation meeting was arranged for 24 February 2021.
That meeting was cancelled as Mrs Parmar went off sick with work-related stress from 23 February to 25 March 2021. During that time, it was decided that another manager, Ms Tote, would take over the disciplinary investigation. Having reviewed the recordings of the interviews Ms Lake had conducted, Ms Tote invited Mrs Parmar to a re-arranged investigation meeting. The recordings and transcripts were not provided to Mrs Parmar at any time, including as part of disclosure in the subsequent litigation.
At the re-arranged investigation meeting on 22 April 2021, Mrs Parmar told Ms Tote that she did not understand, and had never understood, what she had done wrong. At a further meeting on 7 May 2021, Ms Tote informed Mrs Parmar that there was no case to answer and the disciplinary process was concluded.
On the same day, Mrs Parmar brought a claim in the employment tribunal. She alleged that, by transferring her from her role and subjecting her to a disciplinary process, the Council had directly discriminated against her because of her race.
Mrs Parmar claimed that two white Heads of Service, AE and HM, had been implicated in conduct that was broadly similar to hers, if not more serious, but had not been subjected to such harsh treatment. Based on information received in response to a data subject access request (DSAR) to the Council, Mrs Parmar also noted that since 2017, no white senior managers had been disciplined whereas two BAME senior managers had been.
The employment tribunal upheld Mrs Parmar's claim. It found that she had proved facts from which an inference of discrimination could be drawn. In situations where employees of a different race from Mrs Parmar had been implicated in similar conduct, Ms Lake had chosen to address the issues informally or via mediation. The burden of proof therefore switched to the Council to demonstrate that it did not discriminate, but the Council failed to do so. The tribunal also took into account and drew adverse inferences from the Council's failure to disclose the recordings and transcripts from Ms Lake's disciplinary investigation, as well as Ms Tote's notes. Ms Tote had kept her notes for six months. As Mrs Parmar had presented her claim on the same day Ms Tote communicated her decision, the need to preserve such notes would have been obvious from the outset.
When the Council's appeal to the EAT was rejected, it appealed again to the Court of Appeal.
Court of Appeal decision
The Court dismissed the Council's appeal. It noted the dangers of an appellate court reading a tribunal's judgment in a "pernickety" or "hypercritical" way, and emphasised that the appellate court should instead read tribunal decisions "fairly and as a whole", and avoid substituting its subjective preference for the conclusions of the fact-finding tribunal.
It concluded that the tribunal had been entitled to find that the comparators Mrs Parmar had identified were in sufficiently similar circumstances to her, so the Council's different treatment of them supported an inference of discrimination.
If the tribunal had treated the Council's failures of disclosure as automatically shifting the burden of proof, that would have been an error of law. However, it did not do so. Rather, it permissibly took those failures into account and drew adverse inferences from them.
The tribunal had also been entitled to find that the Council's explanations for its conduct towards Mrs Parmar did not adequately explain its actions, and were not credible. Those explanations therefore could not displace the inference of discrimination.
What does this mean for employers?
This case provides a cautionary reminder to employers of the importance of treating employees of all backgrounds in similar circumstances consistently. In this case one clear failing concerned the proper framing of the disciplinary allegations. If it is not possible to identify with specificity what an employee is alleged to have done wrong, there is a greater risk that the disciplinary process could be challenged as discriminatory, including as direct discrimination. It could also lead to an unfair dismissal claim. The case also highlights the need to properly document internal processes and to retain and, where relevant, disclose such documentation in any subsequent tribunal proceedings.
