Case Study: Base Childrenswear Ltd v Otshudi
29th November, 2019
Is lying about the reason for dismissal enough to shift the burden of proof in discrimination cases?
Yes, it was held in the case of Base Childrenswear Ltd v Otshudi.
By way of background, for proceedings brought in contravention to the Equality Act 2010 (“EqA 2010”), there is a shifting “burden of proof”. The “burden of proof” means the obligation on a party to produce sufficient evidence to prove their argument.
Under section 136 of the EqA 2010, the Claimant must prove, on the balance of probabilities, that the Respondent has contravened the relevant provision of the EqA 2010. In simpler terms, the Claimant must produce some evidence before the burden can pass to the Respondent.
The Respondent must then prove that the potentially unlawful act was in no sense whatsoever related to the protected characteristic under the EqA 2010.
Miss Otshudi worked for Base Childrenswear Ltd (“Base”) for three months, as a photographer, prior to being called into a meeting unexpectedly and being summarily dismissed.
Following her dismissal, Miss Otshudi raised a grievance and appealed against the decision to dismiss her. Base did not respond to the grievance or the appeal.
Miss Otshudi brought an employment tribunal claim for racial harassment.
Base originally claimed that Miss Otshudi’s dismissal was “purely financial” and on the ground of redundancy. However, Base later amended its defence to allege that Miss Otshudi was dismissed because of suspected theft- items of clothing were found “concealed” in the photography room, suggesting that Miss Otshudi was going to steal them. Notwithstanding, these allegations were never previously raised with Miss Otshudi. The manager allegedly lied to Miss Otshudi about the reason for her dismissal “to minimise potential confrontation”.
Both the Employment Tribunal and Employment Appeal Tribunal found that race was a factor in Miss Otshudi’s dismissal. The Court of Appeal, in deciding whether there had been an error of law, applied section 136 of the EqA 2010 (as briefly detailed above) to the reasoning of the initial judgment.
The Court of Appeal held that the manager’s persistence in lying about the real reason for Miss Otshudi’s dismissal formed a prima facie (on the face of it) case of race discrimination, and thus shifted the burden of proof to Base.
The Court of Appeal then held that Base failed to show that race had no implications in Miss Otshudi’s dismissal. It was held that as Base failed to show that race played no part in Miss Otshudi’s dismissal, the Claimant’s claim was right to succeed. Although the manager may have had a genuine belief that Miss Otshudi was stealing, this was based on a stereotypical prejudice he held against black people. The burden of proof had shifted and the burden was on the Respondent to evidence that no discrimination had occurred.
The appeal was dismissed.
Considerations for employers
The fact that the manager lied about the reason for dismissal was sufficient to shift the burden of proof. This serves as a reminder to employers that they must be honest about their reason for dismissal, and not try to dress it up as something else. By attempting to conceal the dismissal as a redundancy situation, the employer ended up having a more difficult case to defend. Employers should always follow a fair procedure, i.e. in this case they should have commenced a disciplinary procedure regarding the suspected theft.
As a side note, Miss Otshudi was (amongst other damages) awarded damages in respect of Base’s post-dismissal conduct, including its failure to respond to her grievance; along with a 25% uplift due to Base’s failure to follow the Acas code in respect of Miss Otshudi’s grievance or her dismissal. This illustrates the risks of failing to follow the Acas code when summarily dismissing an employee, even when they have not been employed for more than two years and have no unfair dismissal rights. It is advisable for employers to always follow the Acas code in respect of post-termination grievances, no matter the length of service.
Employers should also ensure that they have clear anti-harassment and bullying policies in place and provide appropriate training to all staff members. These documents are essential in situations where businesses want to distance themselves from employees who may have committed discrimination.
Please contact our employment team if you require a review of your existing policies; require bespoke policies drafting for your company; or require in-house training on any of the issues raised in this article.
Head of Employment & Partner