Appeal No. UKEAT/0001/05/TM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 4 March 2005
Judgment delivered on 11 May 2005

Before
HIS HONOUR JUDGE PETER CLARK
MRS A GALLICO
MR P M SMITH

(1) BHS LIMITED (2) MS R J HOUGH	APPELLANTS

(1) MS S WALKER (2) PREMIER MODEL MANAGEMENT LIMITED	RESPONDENTS

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR BRIAN NAPIER QC
(Of Counsel)
Instructed by:
Messrs Field Fisher Waterhouse
Solicitors
35 Vine Street
London
EC3N 2AA	
For the 1st Respondent	MR GEORGE FOXWELL
(Of Counsel)
Instructed by:
PJH Law
Orion House 
14 Barn Hill
Stamford
Lincolnshire
PE9 2AE	
For the 2nd Respondent	MR R DIXON
Consultant
Instructed by:
Peninsula Business Services Ltd
Riverside
New Bailey Street
Manchester
M3 5PB	

HIS HONOUR JUDGE PETER CLARK

1.	The relevant parties in this matter are Ms Sonja Walker (the Claimant) and British Home Stores Ltd (Bhs) and Rebecca Jean Hough (Ms Hough), First and Second Respondents before the London (Central) Employment Tribunal.  Claims brought by the Claimant against the Third Respondent, Premier Model Management Limited (the Agency) were dismissed by the Employment Tribunal.  There is no challenge to that part of the Employment Tribunal’s Judgment, which was promulgated with very full Reasons on 11 November 2004.  We have before us an appeal by Bhs and Ms Hough and a cross-appeal by the Claimant.

Background
2.	The Claimant was at all relevant times a self-employed model.  Ms Hough was employed by Bhs and was responsible for engaging models for photographic shoots for advertising purposes and making the necessary arrangements.  The Claimant was on the books of the Agency, which supplied models for such purposes.  Both the Claimant and Ms Hough were engaged in same-sex relationships with their respective partners.

3.	The nature of the Claimant’s case, brought under the provisions of the Sex Discrimination Act 1975 (SDA) was, for our purposes, one of sexual harassment, namely that she was subjected to unwanted sexual approaches by Ms Hough, a powerful and influential figure in the fashion world.  She contented that her refusal to accede to Ms Hough’s sexual advances resulted in the loss of her career as a fashion model.

4.	The specific acts of harassment alleged by the Claimant against Ms Hough are conveniently set out at paragraph 17 of the Employment Tribunal’s Reasons.  They number 12 in all, the last of which constituted a complaint of victimisation under Section 4 SDA.  We are not now concerned with the victimisation complaint.

5.	It was common ground that, although self-employed, the Claimant fell within the wider definition of an employee of Bhs contained in Section 82 SDA, but only at such times as the Claimant was actually engaged on shoots for Bhs.  Those shoots took place in 2002 on 7 June (Euston Studios), 23-28 June (Norfolk), 16 August (Euston) and 13 September (again Euston).  Further, it was accepted by Bhs that they were vicariously liable for unlawful acts of discrimination carried out by Ms Hough in the course of her employment.

The Issues
6.	Four issues arise for determination in the appeal and cross-appeal:
(1)	Did the Employment Tribunal err in law in finding that in presenting her Originating Application on 30 November2002 the claims brought by the Claimant were in time?  (The continuing act point).  The Employment Tribunal found that they were.  Against that ruling Bhs and Ms Hough appeal.

(2)	If the claims, or any of them were not in time, was this a proper case in which to extend time under Section 76(5) SDA? (the discretion point)

(3)	Was the Employment Tribunal wrong in law to find that although 2 of the Claimant’s individual allegations were well-founded factually, nevertheless they did not amount to unlawful acts of discrimination because they took place at times when the Claimant was not employed by Bhs for the purposes of Section 82?  (the unlawful point).

(4)	Perversity.

The last 3 issues arise in the Claimant’s cross-appeal.

The Employment Tribunal’s Judgment
7.	We should first wish to express our gratitude to the Employment Tribunal for its collective, careful fact-finding.  Faced with the stark conflict of evidence between the Claimant and Ms Hough the Employment Tribunal did not simply adopt the formula that where a conflict existed they preferred the evidence of one or other of the witnesses; instead they carefully analysed the evidence in relation to each specific allegation, sometimes preferring, for the reasons given, the evidence of the Claimant and on others, that of Ms Hough.

8.	The upshot, using the numbering appearing at paragraph 17 of their Reasons, was that the Employment Tribunal accepted the Claimant’s account in relation to 3 factual allegations, namely:

17.2	That during the shoot in Norfolk, on the night of 25/26 June, Ms Hough knocked on the Claimant’s bedroom door, invited herself in, and attempted to kiss the Claimant.  The Claimant rebuffed her advances.

17.3	That following the Norfolk shoot Bhs took an option over the Claimant for her to travel to Cape Town for a shoot to take place between 11-22 November 2002.  That option was placed on 2 July and later removed on 12 August.  Prior to 12 August, the Employment Tribunal found, Ms Hough sent the Claimant text messages including one dated 16 July which read “U better b nice 2 me till we all go” after referring to the Cape Town trip having been booked.

17.4	On 12 September Ms Hough invited the Claimant out for a bikini shopping expedition followed by dinner, later changed to arrangements for a visit to a sex shop and for Ms Hough to have a tattoo done.  The Claimant declined that new arrangement.

9.	However, the Employment Tribunal rejected the remainder of the specific allegations made by the Claimant.  In particular, they found that on the last shoot attended by the Claimant, that on 13 September, the Claimant was asked to leave the set not due to Ms Hough’s attitude, but because the Claimant had arrived late and then called her partner to the location; a scene ensued and her partner was escorted from the premises by a security guard.  Thereafter the Claimant never worked for Bhs again, that decision being taken not by Ms Hough but another employee of Bhs, Miss Dellow.

10.	Based on their findings of fact, the nature of the Claimant’s case and their self-direction as to the law, the Employment Tribunal reached the following conclusions material to the issues before us:

(1)	Applying the guidance provided by Mummery LJ in Hendricks v Commissioner of Police for the Metropolis [2003] IRLR 96, para 52, they held that the allegations raised by the Claimant amounted to a continuing state of affairs constituting an act extending over a period within the meaning of Section 76(6)(b) SDA.  That state of affairs, beginning on the Claimant’s case on 9 June 2002 (paragraph 17.1; the first allegation) continued until 13 September, the last day of discrimination alleged against Bhs and Ms Hough, so that the complaint presented on 30 November 2002 was in time, Section 76(6)(b) providing that an act extending over a period (a continuing act) shall be treated as done at the end of the period.  In so finding the Employment Tribunal rejected a submission then made on behalf of Bhs and Ms Hough that for the purpose of Section 76(6)(b) it was necessary for the Claimant to prove incidents of unlawful discrimination linked one to the other.

(2)	Having found the complaints of direct sex discrimination to be in time the Employment Tribunal did not find it necessary to determine the alternative submission raised on behalf of the Claimant, that insofar as any allegations arose more than 3 months before the presentation of the Originating application, it was just and equitable to extend time under Section 76(5) SDA.  Had they been required to do so, the Employment Tribunal would not have extended time (Reasons paragraph 161).

(3)	However, the Employment Tribunal found only one of the 3 allegations made out by the Claimant on the facts to amount to unlawful discrimination.  That was the Norfolk incident (paragraph 17.2) when Ms Hough entered the Claimant’s bedroom and attempted to kiss her.  As to the remaining incidents found proven as a matter of fact (paragraphs 17.3 (the text messages) and 17.4 (the invitation to visit a sex shop and tattoo parlour) the Employment Tribunal held that since those incidents took place at a time when the Claimant was not employed by Bhs (cf paragraph 17.2) those events, although amounting to unwanted attention, did not fall within Section 6(2) SDA, nor could they fall within Section 6(1). (Reasons, paragraphs 144-146).

(4)	Based on their finding of a single act of unlawful discrimination (paragraph 17.2), following a remedies hearing held on 27 January 2005, the Employment Tribunal awarded the Claimant £1000 plus interest in respect of injury to her feelings arising from that incident.  No further award was made for aggravated damages nor financial loss.  The remedies Judgment with Reasons is dated 31 January 2005.

Discussion
11.	By Amended grounds of appeal the point now taken by Mr Napier QC (who did not appear below) on behalf of Bhs and Ms Hough is that the Employment Tribunal was wrong to include as part of the “act extending over a period” incidents which were alleged to have occurred at times when the Claimant was not employed by Bhs.  He accepts that it is unnecessary for the Claimant to show that those incidents were themselves unlawful.  See Fearon v Chief Constable of Derbyshire (UKEAT/0445/02/RN. 16 January 2004) paragraph 92, per His Honour Judge McMullen QC.

12.	He submits that the only relevant act found by the Employment tribunal to have occurred during employment was the Norfolk incident.  That period of employment ended on 28 June 2002, more than 3 months prior to presentation of the Claimant’s Originating Application.  Accordingly the claim is out of time, subject to the discretion contained in Section 76(5) SDA, which the Employment Tribunal would not have exercised in favour of the Claimant.

13.	In support of his principal proposition Mr Napier has referred us to a number of Court of Appeal and EAT authorities, whilst accepting that none is directly in point.  In Cast v Croydon College [1998] ICR 500 Auld LJ, at paragraph 28, referring to a passage in the judgment of Bristow J in Amies v Inner London Education Authority [1997] ICR 308, 311, said:
“I do not think that he was suggesting that a complainant could rely on the continuance of a policy long after she had left the employment.”

His Lordship then cited, apparently with approval, a passage from the judgment of Browne-Wilkinson P in Calder v James Finlay Corporation [1989] ICR 157, 159, in which the then President indicated that in a complaint brought under Section 6(2) SDA a continuing act of discrimination could continue so long as the complainant remained in employment.  Mr Napier also points out that the cases of Hendrick, Cast and Owusu v London Fire and Civil Defence Authority [1995] IRLR 574 (EAT) were each concerned with complaints of a continuing act of discrimination during employment and the case of Rovenska v General Medical Council [1997] IRLR 367 (CA) was a case brought by a non-employee under the professional qualification provision contained in Section 12(1) RRA 1976.

14.	Mr Napier further submits that there is no case in which a continuing act, for the purposes of Section 76(6)(b) has survived the ending of employment in a complaint brought under Section Section 6(2) SDA.

15.	We accept that historical proposition.  However, we think that it must be viewed (a) in the light of the House of Lords decision in Rhys-Harper v Relaxion Group Plc [2003] IRLR 484 and (b) on the facts of the present case, where the Claimant brought her claims, in the alternative; under Section 1(1) and Section 6(2) or 6(1) SDA

16.	Rhys-Harper was a case of direct sex discrimination brought under Section 1(1) and 6(2) SDA.  The Claimant was dismissed on 15 October 1998.  She brought an internal appeal, at a time when she was no longer employed by Relaxion, following that dismissal, during which she alleged sexual harassment by her employer during her employment.  The appeal was dismissed, as was her complaint of sexual harassment, on 30 November.  On 19 February 1999 she presented a complaint to the Industrial Tribunal, alleging that the Respondent had failed to investigate her complaint of sexual harassment properly at the time of her unsuccessful appeal.  Relaxion contended that it was not open to her to bring a free-standing complaint of direct sex discrimination which arose after the employment had ended; she in turn relied on the European Court of Justice decision in Coote v Granada Hospitality [1998] IRLR 656 for the proposition that post-employment victimisation was justiciable under the act and so, by extension, was a complaint of direct sex discrimination.

17.	The relevant statutory provisions under SDA are these:
“1.     Direct … discrimination against women 
(1)     In any circumstances relevant for the purposes of any provision of this Act … a person discriminates against a woman if –
(a)     on the grounds of her sex he treats her less favourably than he treats or would treat a man, …
6     Discrimination against applicants and employees
(1)     It is unlawful, for a person, in relation to employment by him at an establishment in Great Britain, to discriminate against a woman –
(a)     in the arrangements he makes for the purpose of determining who should be offered that employment, or
(b)     in the terms on which he offers her that employment, or 
(c)     by refusing or deliberately admitting to offer her that employment.
(2)     It is unlawful for a person, the case of a woman employed by him at an establishment in Great Britain, to discriminate against her –
(a)    in the way he affords her access to opportunities for promotion, transfer or training, or any other benefits, facilities or services, or by refusing or deliberately omitting to afford her access to them, or 
(b)     by dismissing her, or subjecting her to any other detriment.”

18.	It is well-established that in the case of sexual harassment properly so-called, as in the present case, no actual or hypothetical comparator is required for the purposes of Section 1(1).  However, where the discrimination is said to be unlawful under Section 6(2) it was thought at Court of Appeal level that the act complained of must take place during employment (ie prior to termination of employment).  That was the effect of the Court of Appeal decision in Adekeye v The Post Office (No 2) [1997] IRLR 105, a case brought under the equivalent provisions of the Race Relations Act 1976, and the principle in Adekeye was applied by the Court of Appeal in Rhys-Harper [2001] IRLR 460.  The Court was not prepared to extend the principle in Coote to complaints of direct discrimination; instead it was limited to complaints of victimisation.

19.	The House of Lords took a different view.  In particular, disapproving the Court of Appeal approach in Adekeye, (Lord Scott dissenting) the majority of their Lordships concluded that the proper construction of the phrase “employed by him” in Section 6(2) SDA was that it is unlawful to discriminate against former employees, as well as current employees, if there is a substantive connection between the discriminatory conduct and the employment relationship wherever the discriminatory conduct arises.  See Lord Nicholls, paragraphs 37, 44.

20.	In our judgment the earlier cases cited to us must be viewed in the light of the House of Lords approach in Rhys-Harper.  The observations by Auld LJ in Cast must be set against a factual background where it was unnecessary for Ms Cast to contend that the alleged continuing act extended beyond the termination of her employment.  Had she so contended we are confident that, on the state of authority at that time, including Adekeye, she would not have been permitted to do so.  She was no longer employed.

21.	Mr Napier takes a further point, based on the principles emerging from Rhys-Harper.  He submits that in light of the wide interpretation given to the effect of Rhys-Harper, for example the judgment of the Employment Appeal Tribunal (Burton P) in Metropolitan Police Service v Shoebridge (UKEAT/0234/03. 8 June 2004) it is unnecessary to resort to the concept of a continuing act, since post-termination acts of discrimination are actionable in their own right, provided there is sufficient nexus between those acts and the employment.

22.	Finally, he draws attention to an apparent inconsistency between this Employment Tribunal’s finding of a continuing act and their finding that acts alleged other than in the course of the Claimant’s employment were not unlawful under either Section 6(2) or 6(1) SDA.

23.	Mr Foxwell agrees with Mr Napier to this extent.  There is an apparent inconsistency between the Employment Tribunal’s findings leading to what we have characterized as the first and third issues before us.  Hence the cross-appeal on the third issue.

24.	He submits that, following Rhys-Harper as applied by the Employment Appeal Tribunal in Shoebridge (see paragraph 36), the test is “whether there is a substantial connection with the employment relationship or a sufficiently close connection with the employment, or whether the employer was here discriminating qua employer, or whether the facts are sufficiently proximate to, or not remote from, the employment of [or] the employment relationship.”

25.	Applying that test to the facts of this case, the Claimant’s complaint was one of sexual harassment, consisting of a number of incidents directly related to her intermittent employment with Bhs.  The Employment Tribunal permissibly found that such course of conduct amounted to a continuing act terminating no earlier than 13 September.  The claim was in time.

26.	However, the Employment Tribunal departed from the principle correctly applied in relation to the question of a continuing act in finding that the text messages and invitation out on 12 September were not unlawful.  At paragraph 144 of their Reasons the Employment Tribunal discount unlawfulness under Section 6(2) SDA on the basis that those incidents occurred when the Claimant was not in the employment of Bhs.  They appear to hold that the ‘Rhys-Harper principle’ did not apply to those incidents.  Mr Foxwell submits that plainly the substantial connection test was satisfied, looking at the Employment Tribunal’s findings particularly at paragraph 143 of their Reasons.

27.	Alternatively he submits that those incidents amounted to unlawful discrimination by virtue of Section 6(1) SDA.

Conclusions 
28.	We return to the 4 issues before us.  Our conclusions are as follows:

(1)	We reject Mr Napier’s submission that the Employment Tribunal was wrong to conclude that the Claimant’s complaint of a campaign of sexual harassment by Ms Hough did not give rise to a continuing act for the purposes of Section 76(6)(b) SDA because a number of incidents complained of took place outside the employment.  We should have been constrained to so find on the basis of binding authority prior to Rhys-Harper.  However, the avowedly purposive approach by the majority of the House of Lords in that case emboldens us to hold that it was open to this Employment Tribunal to find that the entire course of conduct alleged had a sufficient proximity to the employment relationship to overcome the literal approach advocated by Mr Napier.

(2)	It follows that, like the Employment Tribunal, we are not required to consider the escape clause provided by Section 76(5) SDA.  Had we been required to do so, we should have doubted the Employment Tribunal’s finding at paragraph 161 of their Reasons that no reasons were put forward in evidence as to why it was just and equitable to extend time.  Mr Foxwell has referred us to a number of findings of fact made by the Employment Tribunal and set out at paragraph 16 of the Answer and to paragraph 19 of his closing written argument below which satisfies us that there was evidence and argument which the Employment Tribunal ought to have considered in carrying out this exercise.  However, having upheld the Employment Tribunal decision on primary limitation we propose to make no order on this ground of cross-appeal.

(3)	If follows from our approach, based on Rhys-Harper, to the first issue, that we uphold the Claimant’s cross-appeal in relation to the 3rd issue.  On the Employment Tribunal’s findings of fact it is plain to us that a sufficient nexus existed between the employment and the complaints upheld by the Employment Tribunal as to text messages and invitation out on 12 September to render those acts of discrimination unlawful under Section 6(2) SDA.

(4)	Perversity.  Mr Foxwell has sought to persuade us that the Employment Tribunal’s finding in relation to the events of 13 September 2002 was perverse in the legal sense.  We trust that we shall not be seen to be failing in our duty if we do not rehearse in detail the argument advanced.  We have considered the Employment Tribunal’s careful findings of fact on that topic and are quite satisfied that the submission does not begin to negotiate the high hurdle placed on appellants alleging perversity by cases such as Yeboah v Crofton [2002] IRLR 634.  In short, no error of law is here made out; the Employment Tribunal reached a permissible conclusion of this part of the case.

Disposal
29.	It follows that the appeal is dismissed and the cross-appeal allowed to the extent that we declare that the complaints made by the Claimant and identified at paragraphs 17.3 and 17.4 of the Employment Tribunal’s Reasons, found by the Employment Tribunal to be made out on the facts, were unlawful acts of sex discrimination.

30.	It necessarily follows also that the Employment Tribunal’s award made following the remedies hearing must be set aside, based as it was solely on a single act of unlawful discrimination on the night of 25/26 June 2002 in Norfolk.

31.	Out of an abundance of caution Mr Foxwell indicated at the close of oral submissions that he intended to lodge formal Notice of Appeal against the Employment Tribunal’s remedies judgment.  We have deliberately not enquired into the progress of any such appeal.  To do so would not be fair to Bhs and Ms Hough.  What we propose is that the issue of remedy is now returned to the same Employment Tribunal, chaired by Mr C P Baron, for reconsideration in the light of our judgment to on the cross-appeal.  The existing remedies judgment is formally set aside for that purpose.  The parties have liberty to apply, on notice to each other, on paper to me for further directions if so advised within 14 days of this judgement being handed down.  The Claimant must, in any event, indicate her intentions within the same period as to any appeal subsequently lodged against the Employment Tribunal’s remedies judgment.