Who should pay?

18 Jul 2012

In claims of discrimination, it is not just the employer who can be potentially liable for awards made by the Employment Tribunal, but individuals who acted in a discriminatory fashion as well.

Sometimes, but rarely, it will be possible for an Employment Tribunal to divide up the acts of discrimination and allocate awards against the Respondents accordingly.  This makes life much simpler and everyone knows what they then owe the Claimant. 

More commonly, the Tribunal is not able to neatly divide liability and, therefore, will make an award against the guilty parties as a whole and each Respondent is then jointly and severally liable for payment of the award.  This leaves the question of "who pays what?"

The Employment Appeals Tribunal has found that there is no mechanism to decide this question within the Employment Tribunals' jurisdiction. 

The upshot of this is that the Claimant can choose to pursue one Respondent for the whole award and, unfortunately, that Respondent will have no recourse against the other Respondents for a contribution towards the award; essentially, they will be paying the full penalty for the damages which were partially their fault, whereas the other Respondents who also contributed to the conduct need pay nothing.

This is a wholly unsatisfactory position which leaves individuals and businesses exposed to a Claimant's decision as to who they wish to pursue for payment of their award; however, it is not open to the Courts to close this loophole and only a change implemented by Parliament can rectify the situation.