Ballerino v The Racecourse Association Ltd

Why the case matters

With protection for pregnant women in a redundancy situation having recently been extended, it is more important than ever for employers to understand their obligations and potential liability in this complex area. In brief:

• A woman is protected from pregnancy discrimination under the Equality Act 2010 (for this she does not need a comparator, she just needs to establish unfavourable treatment because of pregnancy).
• Special protection is afforded to pregnant women, and for a period of 18 months after their expected week of childbirth. If their role becomes redundant, they have the right to be offered a suitable alternative vacancy, without the need for a competitive interview.
• Failure to offer a suitable alternative will constitute sex discrimination and is likely to give rise to a claim for automatic unfair dismissal under ERA 1996.

The case considered below illustrates possible pitfalls for employers, where they are seeking to make changes to a woman's role when she is on maternity leave. It also illustrates how even employment tribunals can fail to navigate this area correctly, with the case having to be remitted for reconsideration due to an error in the employment tribunal's approach. 

Facts

The claimant was employed as a financial accountant 40 days per year. Being pregnant when she applied for the role, she went on maternity leave roughly 4 months into the role. While she was on maternity leave, her employer replaced her role, creating a full-time role of business and financial analyst; this absorbed the claimant's duties but also contained other strategic elements. The claimant was invited to accept a draft settlement agreement to bring an end to her employment, whilst also being told she could apply for the new role. When the parties could not agree on a way forward, she was dismissed. 

The claimant brought a claim for pregnancy discrimination and automatic unfair dismissal. An employment tribunal accepted the employer's explanation that the claimant's role had been made redundant so did not uphold the discrimination claim. It also decided that the new role was not a suitable alternative vacancy within the meaning of the relevant regulations since it was a more strategic role. The claimant appealed to the EAT. 

Decision

The EAT remitted the case, finding that the employment tribunal had erred in its approach. It had not considered the issue of whether there was a redundancy in a structured way, rather it had decided this as a matter of impression. The EAT noted that a business reorganisation may entail a redundancy but will not necessarily do so. It is important to return to the statutory definition of redundancy in section 139 ERA 1996 before considering whether the obligation to offer a suitable alternative vacancy is triggered. Also, it is not necessarily the case that a fuller role, with more responsibilities, will always be 'unsuitable' and the tribunal should have scrutinised this more aspect more carefully. 

Comment

This case illustrates a basic point, that employers must tread very carefully, regardless of business disruption, where a woman goes on maternity leave shortly after commencing employment. As the ECJ case of Tele Danmark illustrated some years ago, the protection afforded to pregnant employees is very strong. In that case, it was discriminatory to dismiss a woman who would have been absent for the whole of her fixed-term contract, it was irrelevant that other employees might have been treated in a similar way or that the resources of the employer made it difficult to cope with her absence. Having said that, employers should not avoid genuine reorganisations or redundancies, simply because someone is on maternity leave or has recently returned. The distinction between a reorganisation and redundancy can often be difficult to understand, even for qualified lawyers, so advice should be sought in this area. It is also worth noting that the new Government has pledged to strengthen protection for pregnant women in future.