Case update: Can companies bring discrimination claims?

16 October 2015

In the recent case of EAD Solicitors LLP v Abrams, President Langstaff ruled that a company can bring a discrimination claim on the grounds that it has suffered detrimental treatment because of the protected characteristic of someone with whom it is associated.

Mr Abrams was a member of EAD Solicitors LLP. He then set up his own limited company, for tax purposes, which effectively replaced him as a member of the LLP. He was the sole director of this limited company and he continued to work as a fee earner for the LLP. When Mr Abrams was a member of the LLP, it was agreed that he would retire at the age of 62. Upon attaining this age, the LLP objected to Mr Abrams continuing his services at the LLP and ceased paying the limited company in respect of work carried out by Mr Abrams.

Mr Abrams and his limited company brought a Tribunal claim against the LLP for associative age discrimination. The LLP argued that a limited company could not bring a discrimination claim under the Equality Act 2010. However, the Tribunal held at first instance that the company had the right to bring this claim. The LLP appealed this decision.

The EAT’s clear opinion was that a limited company can be a “person” for the purposes of the Equality Act 2010 and therefore, even though it is not a “natural person” it has the right to protection from discrimination.

The “person” suffering a detriment as a result of discrimination does not need to have the protected characteristic in question, but rather may suffer a detriment because of a protected characteristic, which another person may have. Detrimental treatment can be given to any person, whether that person is natural or legal.

President Langstaff found “there are any number of examples that may be given of treatment which comes within the scope of this question that is plainly contrary to public policy”. Some examples of where a company may bring a discrimination claim include:

  1. A company being shunned commercially because it is seen to employ a Jewish or ethnic workforce;
  2. A company that loses a contract or suffers a detriment because of pursuing an avowedly Roman Catholic ethic;
  3. A company that suffered treatment because of its financial support for the Conservative Party, or say, for Islamic education;
  4. A company that was deliberately not favoured because it offered employment opportunities to those who had specific disabilities that were unattractive to some would-be contractors; or
  5. A company that suffered a detriment because of an openly gay stance of a chief executive.

The effect of this decision is it confirms that companies, as well as individuals, have the right to protection from unlawful discrimination.

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