Multi-million discrimination awards are rare but they still scare employers

A hospital doctor has been awarded a record £4.5m for sex and race discrimination by an employment tribunal. It is an enormous amount of money but, according to the tribunal report, the employer’s behaviour was enormously bad. So bad that the HR Director and Medical Director were, together with the Trust, held jointly liable for the award.

However, it brought to mind a similar case I came across a couple of years ago. Again, the employer had behaved badly. It wasn’t discrimination, just plain old-fashioned bullying culminating in a political knifing during a corporate restructure. The employee on the receiving end, a relatively senior long-serving manager, won his tribunal case. Like Eva Michalak, he was in his 50s and would never work again in such a senior capacity. He was awarded around £65,000, which was the maximum the tribunal was able to give him for unfair dismissal. It was barely half a year’s salary.

It doesn’t sound fair does it? Employers can be punished for behaving badly but the reason behind their behaviour can lead to radically different financial penalties. For illegal discrimination, the sky is the limit, in theory. For any other reason, such as personality clash, bullying or a good old corporate shafting, the payout is capped at around £80k.

Of course, as Mrs Markelham notes, huge discrimination payouts are rare and employers are more likely to lose an unfair dismissal case than a discrimination claim. But, because of the publicity, around them, discrimination claims scare the hell out of managers. A grievance or performance management issue with even the possibility of turning into a claim for racial or sex discrimination will have most managers running for cover. Even the most confident organisations, with the best HR and legal support, go into a tizzy when faced with a discrimination claim.

The government is unlikely to do much to equalise the penalties for unfair dismissal and discrimination. If anything, it is weakening unfair dismissal protection even further which will only make people look for ways of claiming discrimination. These days, a lawyer advising the chap in the case I described above would probably suggest shoving in an age discrimination claim for good measure.

Massive payouts like the one awarded to Eva Michalak are rare but the publicity around them scares managers and emboldens those employees who fancy having a go at their employers. If the unfair dismissal route is gradually choked off, more people may try their luck with a discrimination claim. You might not get £4.5m but you’ll sure as hell put the wind up your boss.

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4 Responses to Multi-million discrimination awards are rare but they still scare employers

  1. Annabel says:

    I am also seeing the reverse, where members of a group perceived to be likely to bring discrimination claims are left largely in supervised due to fear of discrimination claims. Chaos and lack of fairness being the usual results!

    • Rick says:

      Annabel – yes I’ve noticed that too. For the same reason. Often managers try to shunt people into different parts of the organisation, rather than deal with the problem because they think it will be too difficult.

  2. Pingback: Multi-million discrimination awards are rare but they still scare employers - Rick - Member Blogs - HR Blogs - HR Space from Personnel Today and Xpert HR

  3. Very good point about the changes to the unfair dismissal qualification period (from 1 year to 2 years) from April 2012 being a problem for employers. It is being promoted as ‘good news’ for employers with a suggested reduction in claims. The reality is much more likely to be an increase in the type of claims referred to here, e.g. discrimination and others, where there is no qualification period and the potential penalties (both financial and brand damage) are much more feared.

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