On 5 May 2023, the Employment Appeal Tribunal (EAT) handed down its judgment in Boohene and others v. Royal Parks Limited. The appeal considered whether, under section 41 of the Equality Act 2010, workers employed by third party contractors could rely on the organisation’s own employees as comparators in a claim of indirect discrimination regarding rates of pay. The decision highlights the importance in indirect discrimination claims of correctly identifying the provision, criterion or practice (PCP) complained about and the right pool of people against which the effect of the PCP should be compared.
The Respondent had a policy of paying its employees the London Living Wage (LLW), a voluntary pay rate set by the Living Wage Foundation. The claimants, who worked for a contractor providing cleaning services to the Respondent, did not receive the LLW.
The outsourced workers claimed that the Respondent’s policy of paying the LLW to its directly employed workers, but not to them, was a PCP and was indirectly discriminatory. This was because it had a detrimental impact on those from black and minority ethnic (BAME) backgrounds, who were more likely to work for contractors.
At first instance, the Employment Tribunal (ET) agreed that the PCP placed BAME workers at a disadvantage and that the Respondent’s decision not to require that contract workers were paid the LLW could not be justified.
That decision was overturned by the EAT, which allowed Royal Parks’ appeal and found that there was no indirect discrimination. The ET had misidentified the pool for comparison and narrowed it without justification. The EAT held that the ET should have made comparisons with a pool of all outsourced contract workers, rather than only comparing the directly employed workers and the Claimants. Ultimately, when analysing the impact of a PCP, the pool being considered should consist of the entire group it affects.
What does this mean for employers?
When identifying comparator pools for the purpose of considering whether a PCP constitutes indirect discrimination, it is important to be wary of drawing the pool too narrowly and thereby comparing the wrong groups. In this case, the appeal was allowed because the ET should have compared directly employed staff with all outsourced workers, rather than just those on the cleaning contract. In this case, when considered against this wider pool, it was found that the decision not to pay the LLW was not discriminatory.