In this blog, we take a closer look at the recent decision of Bathgate v. Technip  EAT 155, which serves as a crucial reminder of two important employment law principles: the ongoing nature of the duty not to discriminate and the limits of attempting to settle possible future claims by reference to an ever-growing list of employment rights.
The recent case of Bathgate v. Technip EAT 155 serves as a crucial reminder of two important employment law principles. Firstly, claims can be for post-termination discrimination. Secondly, there are real problems for employers in attempting to obtain a waiver of such claims by way of settlement agreements. In the Employment Appeal Tribunal’s (EAT) opinion, the common practice of listing a variety of potential claims in such agreements “merely by reference to their legal character or section number” can fall foul of Parliament’s intention of preventing employees from relinquishing their rights and protections under the Equality Act (Act). In this blog, we consider post-termination employment claims, as well as the limits of settlement agreements in shielding employers against such actions.
Post-termination claims: the law
Section 108 of the Act extends protection from discrimination and harassment to relationships which have terminated, including those between employers and employees. This ongoing protection applies provided the alleged discriminatory act, omission or harassment (i) arises out of and is closely connected to the former employment and (ii) would contravene the Act if it had occurred during the employment relationship. Case law has shown that employers are especially susceptible to falling foul of this duty in relation to both post-termination contractual obligations (such as confidentiality and bonuses) and non-contractual provisions (for example, in relation to providing references for former employees).
There is a (fairly) strict three-month time limit for raising discrimination claims and this applies both during and after employment. However, the three months generally starts from the date of the discriminatory act and tribunals will take account of the fact that there may be some delay before an ex-employee becomes aware that they have been discriminated against by their former employer.
Further, while post-termination victimisation claims are not specifically legislated for, employers should be careful not to engage in any potentially victimising conduct, as the Employment Tribunal has historically upheld former employees’ claims in this regard.
Post-termination claims: Bathgate v. Technip
Mr Bathgate had been employed by Technip Singapore PTE Limited as a Chief Officer for approximately 20 years, when his employment was terminated by way of a voluntary redundancy agreement. At the time of signing the agreement, it was unclear whether Mr Bathgate would be entitled to receive an additional payment in June 2017. This was because the company had not yet decided how to interpret the redundancy agreement according to the historic collective agreement to which it referred. In early March 2017, Mr Bathgate’s employer decided that he would not receive the additional payment because he was aged 61 or over. This decision was not communicated to him until June 2017. Mr Bathgate raised a claim for direct and/or indirect age discrimination. The parties agreed the discriminatory act took place after his employment had ended, and that Section 108 of the Act therefore applied.
On the particular facts of this case, the EAT ultimately ruled that Mr Bathgate’s claim could not succeed. However, this was because the Claimant had worked outside UK and EEA waters on a Bahamas-registered ship for the majority of his employment and so he was not entitled to raise an action under the Act.
Nonetheless, Lord Summers giving the EAT’s decision had no difficulty accepting that the Act extended protection for post-employment claims to any and all former employees who had worked in the UK (or in UK or EEA waters, as well as on ships registered in the UK) for the majority of their careers. In his judgment, Lord Summers went on to explain the parameters of this protection by reference to Parliament’s intention that “the lawfulness of the conduct after the employment should be measured by its lawfulness prior to termination”. In short, an employee may raise a valid claim for post-termination discrimination provided the act or omission alleged to have been carried out by the employer would have constituted a discriminatory act or omission during employment.
Settlement agreements: the law
For a settlement agreement to constitute a valid waiver of employment claims, it must meet certain statutory conditions. For example, it must be in writing and the employee must have received independent legal advice on its terms. Under Section 147(1)(b) of the Act, it is also essential that the agreement relates to a “particular complaint”. On this latter requirement, there has been much judicial commentary. Bathgate v. Technip has now added to this discussion, specifically in relation to the question of whether a claim which has not yet arisen at the time the settlement agreement is concluded is a “particular complaint” that can therefore be validly settled.
Settlement agreements: Bathgate v. Technip
As noted, Mr Bathgate’s employer’s decision not to make the additional payment to him because of his age had not been made when the agreement was signed. Notwithstanding that fact, the employer argued that, as the agreement listed “direct or indirect discrimination” and “age discrimination” claims as having been waived, the particular complaint had been validly identified and Mr Bathgate had accordingly surrendered his right to raise these claims. To support this argument, the company relied on the 2005 case of University of East London v. Hinton, which is considered authority for the proposition that potential future claims may indeed be settled provided the nature of the claim, or its relevant section, is identified in a settlement agreement. However, the EAT in Technip did not agree.
Lord Summers pointed out the specific context of the Hinton decision. In that case, the future claim was known at the time of signing the agreement. Therefore, the EAT said Hinton “is not authority for the proposition that the words ‘particular complaint’ mean a complaint that may or may not occur at some point in the future. It is authority for the proposition that a known complaint can be settled“. Lord Summers reinforced this conclusion by reference to the statement of Parliamentary intention, which provided that settlement agreements must settle “a particular complaint that has already arisen between the parties”. He stated that the words “already arisen” indicated that, before an employee could validly waive their rights to a statutory claim, it was essential for an actual complaint, or at least the grounds for an actual complaint, to exist. Since, in Mr Bathgate’s case, his eventual claim “depended on discussions whose outcome was unknown, the parties could not settle any future complaint of age discrimination”. Lord Summers also pointed out that, while signing away rights to raise certain claims may validly be achieved under common law, employment-related and Equality Act rights are different in nature.
The EAT also referred to the parallel provision in the Employment Rights Act 1996, and concluded that the intention behind Section 147 of the Act was to protect employees and limit their ability to sign away valid claims. It decided Mr Bathgate had not relinquished his right to raise an age discrimination claim in respect of alleged discrimination which occurred after he signed the settlement agreement.
Finally, in delivering its decision, the EAT went on to point out the difficulty in reconciling the statutory requirement for a “particular complaint” with the common practice of listing numerous claims merely by reference to their nature or section number. In Lord Summers’ judgment, he wrote “it does not seem to me that there is any difference in principle between a ‘rolled up’ waiver and a waiver that lists a variety of possible claims…both are general waivers”. In Hinton, Lady Smith had critiqued the act of listing out every kind of possible employment claim as “not…good practice for lawyers” but, until now, no court or judge had gone so far as to question the validity or efficacy of settling claims by reference to specific statutory provisions.
In short, the case of Bathgate v. Technip provides a useful reminder to employers across the UK of the ongoing nature of the duty not to discriminate, as well as the limits of attempting to settle possible future claims by reference to an ever-growing list of employment rights.