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Sex Discrimination Act update

01 April 2008

In March 2007, the Equal Opportunities Commission successfully challenged the Employment Equality (Sex Discrimination) Regulations 2005.

The High Court found that the Regulations which amended the Sex Discrimination Act 1975 ("SDA") did not adequately implement the Equal Treatment Directive (76/207/EEC) (as amended by the Equal Treatment Amendment Directive (2002/73/EC)). The High Court ordered the Government to make further amendments, in particular amendments relating to harassment, discrimination on grounds of pregnancy or maternity and the rights of women on maternity leave.

The Sex Discrimination Act 1975 (Amendment) Regulations 2008 ("the 2008 Regulations") implement a number of changes and will come into force from 6 April 2008.

Firstly, the 2008 Regulations incorporate an amended definition of harassment. The SDA provides that a person harasses a woman where "on the ground of her sex he engages in unwanted conduct that has the purpose or effect of violating her dignity, or creating an intimidating, hostile, degrading, humiliating or offensive environment for her".

This definition has been amended so that when a person harasses a woman "he engages in unwanted conduct that is related to her sex or that of another person". The harassment may therefore be related to the sex of any other person. The Explanatory Memorandum which has been prepared by the Government Equalities Office suggests that this amended definition will widen the scope of cases to include circumstances where an employee had been offended by sexist remarks about another person.

Secondly, the 2008 Regulations extend the SDA to include new liability for employees who fail to protect an employee from third party harassment. A third party is defined as someone other than the employer or another employee. Under the 2008 Regulations, an employer is only liable in the following instances:

(1) where a third party subjects the woman to harassment in the course of her employment;

(2) the employer has failed to take such steps as would have been practicable to prevent the third party from doing so; and

(3) the employer knows that the woman has been subject to harassment in the course of her employment on at least two other occasions by a third party.

The third limb of the above three-stage test appears to provide employers with considerable latitude. Even if the third party in question has a reputation for having subjected other employees to harassment in the past, and the employer has taken no action to prevent further harassment from occurring, under the new definition a new "victim" will not have a remedy until she herself has been harassed three times.

Thirdly, the 2008 Regulations amend the definition of discrimination on the grounds of pregnancy or maternity. This amendment removes the requirement for there to be any form of comparator. For instance, section 3A of the SDA provides that "at any time in a protected period, and on the grounds of the woman's pregnancy, [the employer] treats her less favourable than he would treat her had she not become pregnant". Regulation 2 of the 2008 Regulations removes the words "than he would treat her had she not become pregnant" and makes similar omissions in respect of section 3A (1)(b) and section 3A (2) of SDA.

The 2008 Regulations also makes amendments to the terms and conditions of contracts during maternity leave. EU law provides that a woman who has suffered less favourable terms as a result of being on additional maternity leave ("AML") is entitled to bring a discrimination claim. Whilst the Maternity and Parental Leave Regulations 1999 ("MPL Regulations") preserves benefits during Ordinary Maternity Leave ("OML"), with the exception of remuneration, a much more limited range of benefits are preserved during AML.

Regulation 5 of the 2008 Regulations does not distinguish between OML and AML for the purposes of a claim for pregnancy or maternity discrimination. However, as this would mean that an employee's rights under the SDA would be greater than those under the MPL Regulations, Regulation 5 of the 2008 Regulations will only take effect for employees whose expected week of childbirth is on or after 5 October 2008. This will allow the Government time to make the corresponding changes to the MPL Regulations.

The 2008 Regulations also makes amendment to discretionary bonuses. Under EU law, where a woman has taken maternity leave for part of the period to which the bonus payment relates, the employer is entitled to reduce her bonus pro-rata to take account of the time spent on maternity leave, although any compulsory maternity leave ("CML") taken during this period must be treated as time worked. Previously, the SDA did not make provisions for contractual bonuses in relation to CML, so that CML did not count as working time for the purpose of allocating bonuses. Regulation 6A(2)(c) of the 2008 Regulations amends this; this will affect women whose EWC starts on or after 1 October 2008.

The 2008 Regulations are intended to bridge the gaps left open by the Employment Equality (Sex Discrimination) Regulations 2005. The effects that the 2008 Regulations will have on case law remains to be seen.

For more information on the Act, please contact 01753 279029 or employmentlaw@bpcollins.co.uk.