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Case update (1): Sex discrimination – Reorganisation and flexible working arrangements

Summary:  When designing new roles during a business reorganisation, should consideration be given to the impact on staff who work flexibly, including designing roles to take account of existing flexible working arrangements?

Yes, says the EAT in Fidessa Plc v Lancaster available here.

Facts:  The employee, Ms Lancaster, had been employed full-time by the employer, Fidessa Plc, since 2010 as an engineer in the connectivity operations team. There were three people within that team. Ms Lancaster took maternity leave from August 2012 to August 2013. She returned on a part-time basis working four days per week from 9am-5pm, although it was agreed that there could be flexibility around those times and leaving at 5pm was important for Ms Lancaster as she needed to be able to collect her daughter from nursery.  This was formalised as part of a flexible working request.

In July 2014 Ms Lancaster was in the early stages of a further pregnancy. She told her line manager about this and needed time off to attend an antenatal appointment. Her line manager had to clear the request with a more senior manager. The time off was refused and when the manager concerned was informed of the reason for the request, his response was “oh f***, she’s pregnant”.  This comment was not reported to Ms Lancaster at that stage, but was later.

Part of Ms Lancaster’s work had to be carried out after 5pm, such as deleting information that traders no longer needed, and this could not be done until the end of trading on the UK markets. As part of her flexible working request, it was agreed that Ms Lancaster could complete this work from home. Sometime later, another manager refused to stick to this agreement, requiring Ms Lancaster to work after 5pm.

Proposals were then made to reorganise the connectivity department from three to two employees. The proposal was to create a new engineer role that was similar to Ms Lancaster’s but with a greater emphasis on work being carried out after 5pm. Ms Lancaster decided not to apply for the role and was made redundant. She raised a grievance alleging unfair treatment and discrimination which was not upheld. She appealed against her dismissal which was unsuccessful.

Ms Lancaster brought claims for direct and indirect sex discrimination, harassment, part-time worker detriment and unfair dismissal.

The Tribunal decided that the manager’s reaction to Ms Lancaster’s pregnancy amounted to direct and indirect sex discrimination and harassment. Further, the Tribunal found that reneging on the agreement that Ms Lancaster could leave work at 5pm amounted to less favourable treatment of which her part-time status was the predominant and effective cause.

The Tribunal also found that Ms Lancaster had been unfairly dismissed.  The Tribunal did not accept that the restructuring exercise was a sham to remove Ms Lancaster from Fidessa.  However, it found that the requirement to perform key tasks after 5pm which could not be performed at home, would put women at a disadvantage and was indirect sex discrimination. There had been no proper consideration of alternative ways of working and therefore Fidessa could not objectively justify this requirement. Therefore Ms Lancaster’s dismissal was tainted by direct and indirect sex discrimination and was rendered unfair.

Fidessa appealed against the Tribunal’s decision, but the EAT largely upheld the Tribunal’s decision.

The EAT agreed that Ms Lancaster was put at a disadvantage by the requirement of having to undertake work after 5pm in the workplace rather than at home. This disadvantaged women as part of the group that predominantly have a requirement to collect children at the end of the working day. Although Fidessa had a potentially fair reason for dismissal i.e. redundancy, the Tribunal was entitled to take into account the fact that the only reason Ms Lancaster did not apply for the new role was because of the requirement to work after 5pm and this was relevant to the question of fairness.

The EAT reluctantly upheld the appeal in relation to direct sex discrimination and harassment arising from the manager’s comment about Ms Lancaster’s pregnancy.  It remitted this aspect back to the Tribunal to reconsider.  The EAT took this decision because the Tribunal had failed to make any findings as to the impact of the comment on Ms Lancaster and therefore ‘harassment’ had not been proved.

Implications:   This case is a helpful reminder to employers to take care to be flexible and reasonable when dealing with, in particular, working arrangements which may involve childcare considerations.

In particular in respect of this case, a requirement to 1) undertake work after 5pm (or at the end of working hours) and 2) to do so at the workplace; is a two part provision, criterion or practice (PCP) that creates a disadvantage more likely to be suffered by women given that they as a group predominantly are required to exercise childcare functions and collect children from nursery after work.  Especially if, as in this case, it is work that can be done remotely. Whilst an employer may be able to impose such requirements, it is vital that they are a proportionate means of achieving the employer’s aims.  This means that the employer is able to justify them and also looks at alternatives to alleviate or eliminate any impact on the group in question.

Also, this case is a  good reminder to employers that they must take into consideration any existing agreements in place that concern flexible working arrangements when consulting with employees about alternative roles in a redundancy situation. Failure to do so and to incorporate the same agreement and flexibility into the alternative role may amount to a PCP, which if found to be indirectly discriminatory may also impact on the fairness of any redundancy dismissal. This is the position even if the employee does not choose to apply for the alternative role on offer, as was the case here.

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