Heads-up on harassment changes

The Government has given support to a Private Member’s bill which will change the law on sexual harassment. The Worker Protection (Amendment of Equality Act 2010) Bill (the Bill) introduces a duty on employers to prevent sexual harassment and reinstates employer liability for third party harassment, albeit this time with a less complex legal test to meet. Although the Bill is at the early stage of the parliamentary process and may change, this Law-Now provides employers with a heads-up on what is currently being proposed.

The new duty on employers to prevent sexual harassment

The new duty on employers to take all reasonable steps to eliminate sexual harassment in the workplace will be enforceable by the equality regulator, the Equality and Human Rights Commission (EHRC). This proposed approach was discussed in detail in an earlier consultation and Government response, which we covered in a previous Law-Now in the summer of 2021. However, at that stage, the detail on what was being proposed was missing from the consultation response, and this Bill now fills in the gaps.

According to the Bill a breach of the duty will be an unlawful act for the purposes of current equality legislation, enforceable by the EHRC. In their parliamentary briefing on the Bill, the EHRC say that they “will establish a mechanism for employees and employee representatives to notify us of breaches or potential breaches of the preventative duty.” Non-compliance with the preventative duty will potentially lead to a range of outcomes by the EHRC including litigation, investigation and enforcement activity.

In addition, if an employee is successful in a claim for sexual harassment before an Employment Tribunal and the Tribunal rules that the employer was in breach of their preventative duty, the Tribunal will have the power to award an uplift in compensation of up to 25%.

Liability for third party harassment

The previous obligation on employers over liability for harassment of its employees by third parties was repealed in 2013, after it had been deemed unworkable. It applied what was known as the “three strikes” rule. An employee had to show two previous incidents of harassment by a third party before an employer could be held liable. The new provision is much more straightforward.

An employer will now be liable if a third party harasses an employee in the course of their employment, if the employer has failed to “take all reasonable steps to prevent the third party from doing so”.

The definition of a third party is drafted widely and currently refers to a person who is not an employee of the employer. This could cover customers, suppliers, business partners and other individuals or organisations that the employers’ staff come across in a work context, whether in a consumer-facing or B2B commercial context. It should be noted that this provision (unlike the new preventative duty) is not limited to sexual harassment and covers the other relevant protected characteristics, so for example, would also apply in relation to harassment on the grounds of race.

Comment

Could the creation of a preventative duty focussed only on sexual harassment mean that employers concentrate their limited resources on preventing discrimination between the sexes? That would be an unfortunate unintended consequence. Employers should make it clear that all forms of harassment will not be tolerated.

Uncertainty also remains over what precise steps employers should be taking to meet this new duty, although the EHRC has said that they will publish a statutory Code of Practice if the Bill becomes law. Certainly more will be needed than simply having anti-harassment policies and annual tick-box training. Recent case law (which we discussed in a previous Law-Now) has established that equality training needs to be relevant, up to date and fit for purpose.

Businesses therefore now have an even greater imperative to focus on the culture of the organisation, including tackling well-known issues around tone from the top, how complaints of sexual harassment are dealt with, and tolerance of microaggressions. Different organisations will need to take a variety of steps, depending on the nature of their existing approaches to these issues.

It also remains to be seen how effective enforcement by the EHRC will be. That the EHRC has responsibility for enforcing the preventative duty sends a message that the aim is about improving workplace processes through proactive compliance, rather than creating another individual remedy which is reactive to “bad behaviour”. Whether the EHRC is able to act on potentially large volumes of notifications under this provision will depend on the level of additional resources allocated to them.

For all businesses, but particularly those with large customer-facing workforces, risk management of third party liability will also take some careful thought. And it is a significant issue: the EHRC Turning the Tables report highlighted that around a quarter of employees who reported harassment said that the perpetrators were third parties. Steps employers may take will depend on the nature of employees’ interactions with third parties, for example whether they are customer facing or B2B, and interacting face-to-face or remote (or indeed hybrid). As a minimum, employers should make clear in their relationships with all third parties the standards of behaviour that must be afforded to their staff. In a commercial or B2B context this may need to be reflected in contractual provisions.

These changes are not expected to be implemented in the short term, leaving employers time to plan ahead. The Bill indicates that the provisions will come into force one year after Royal Assent. As it has yet to clear the committee stage of the House of Commons, the changes may not be operational until early 2024. However, it does most definitely put a review of workplace harassment processes back on business’ risk agenda for 2023.

For more information on reviewing harassment processes, policies and training please contact your usual contact in the CMS employment team. You can find more information on the risks involved in failing to deal with equality-related issues in our Advising the Board report on Equity, Diversity and Inclusion.