Appeal No:  UKEAT/0278/09/ZT

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 26 November 2009
	             Judgment handed down on 17 February 2010

Before
HIS HONOUR JUDGE BIRTLES
MS V BRANNEY
MR D CHADWICK 

MAY & BAKER LTD t/a	APPELLANT
SANOFI-AVENTIS PHARMA

MRS F OKERAGO	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellant	MR G MANSFIELD
(of  Counsel)
Instructed by:
EEF Legal Services
Broadway House
Tothill Street
London SW1H 9NQ	
For the Respondent	MR T DEB
(Representative)
KM Legal Advisory Ltd
Berkeley Business Centre
246-250 Romford Road
Forest Gate
London E7 9HZ	

SUMMARY
RACE DISCRIMINATION
Aiding and abetting
Contract workers

The Employment Tribunal erred in law in finding that a contract worker made the Claimant’s employer liable for direct race discrimination under sections 32 and 33 of the Race Relations Act 1976.  The Tribunal failed to (a) make necessary findings of fact (b) to analyse the facts and the statutory provisions and apply them correctly.  Observations on the correct meaning and appreciation of sections 32 and 33.

HIS HONOUR JUDGE BIRTLES 
Introduction
1.	This is an appeal from the judgment of an Employment Tribunal sitting at Stratford in November and December 2008.  The unanimous judgment of the Tribunal was:

(a)	The claim of direct discrimination as set out at paragraph 3.1 of the judgment was made out.  All other allegations of direct discrimination were dismissed.  The harassment claim was also dismissed: judgment paragraph 102.
(b) 	The claim of victimisation was made out, as was the complaint of unfair dismissal.

2.	This appeal is only against the Tribunal’s findings that there was direct race discrimination under paragraph 3.1 of its judgment.

3.	At the hearing of the appeal before us on 26 November 2009 the Appellant was represented by Mr Gavin Mansfield of counsel and the Respondent was represented by Mr Tridib Deb, a representative.  

The material facts 

4.	The fact-finding exercise carried out by the Employment Tribunal was extensive.  The Tribunal’s findings of fact were set out in paragraphs 9-78 of the judgment.

5.	The Appellant is a manufacturer of drugs.  The Claimant was employed by the Appellant from 17 April 2001 as a pharmacy inspector.  She was dismissed on 28 March 2007 purportedly for a reason related to conduct.  The Claimant claimed that her dismissal was unfair, discriminatory on grounds of race and also race victimisation.  She also complained of a number of alleged detriments during her employment which she alleged to be direct race discrimination, harassment and/or (in relation to events after a complaint in December 2006) race discrimination.  The Tribunal set out the issues at paragraphs 2-7 of its judgment.

6.	In relation to the claim of direct discrimination under paragraph 3.1 of the judgment the Tribunal made the following findings of fact at paragraph 12:

“12. 	In July 2006 the Claimant says Terri Dower a white Caucasian woman asked her what she was doing here and told her to go back to her own fucking country when she responded “my country” in response to a question, “who would she support England or her own country in a World Cup match?”  The Claimant did not pursue a complaint about this at the time.  A number of other colleagues were present including Veronica Ngoroge who told the Claimant she should not have replied to the question.  While the Claimant raised this matter in her grievance it was never specifically investigated and no identifiable findings were ever made about it.  The Respondent has never explained this.”

7.	The grievance was raised on 6 December 2006: judgment paragraph 23.  There was no finding that there had been any early incidents of racist behaviour by Ms Dower.  The Tribunal expressly did not take into account an earlier allegation of racist comments in 2004, as that allegation had not been raised with the Respondent’s witnesses: judgment, paragraph 23.

8.	The Tribunal found that the World Cup incident occurred as the Claimant described it: judgment paragraphs 48 and 96.  The Tribunal found that the incident was less favourable treatment on ground of race/ethnicity/national origins: judgment paragraph 96.

The basis of the Appellant’s liability for Ms Dower

9.	Ms Dower was not an employee of the Appellant company but was an agency worker.  This is clear from the Tribunal’s findings: 

(a)	In paragraph 3 of the judgment she is described as a “White Caucasian Agency Inspector”.
(b)	Ms Dower was an agency worker supplied to work for the Appellant company by a recruitment agency known as Adecco.  In February 2007 Ms Dower was removed from the contract with the Appellant company at a meeting attended by Ms Dower, Mr Ridgett of the Appellant company and two representatives of Adecco.  Although removed from the contract between Adecco and the Appellant company, she was retained by Adecco: judgment paragraphs 3, 39 and 47.

10.	The Appellant company did not place any documents relating to the contract between Adecco and the Appellant company or any contractual documents (if they existed) between the Appellant company and Ms Dower.  There was no application for disclosure of any such documents by the Claimant’s representative.  It follows that the findings we have referred to are the sole factual findings on this issue made by the Employment Tribunal.

11.	The Appellant’s representative was a Ms N Balogun.  She specifically addressed the point that the Appellant could not be vicariously liable for the actions of Ms Dower because she was not in employment with the Appellant within section 78(1) of the Race Relations Act 1976.  The Tribunal recalled that Ms Balogun referred them to Mirror Group Newspapers v Gunning [1986] IRLR 27.  She submitted that the matters pre-dated changes concerning liability for third party discrimination and said that the position was therefore as set out in Macdonald v Ministry of Defence and Pearce v The Governing Body of Mayfield Secondary School [2003] ICR 512.

12.	The Tribunal’s notes of the Claimant’s submissions do not refer to the Claimant’s representative addressing this issue at all: judgment paragraph 79.

13.	Despite recording Ms Balogun’s submissions, the Tribunal did not address this point at all.  The Tribunal did set out certain statutory provisions at paragraph 82.  These included sections 32 and 33 of the Race Relations Act 1976.  However, the Tribunal did not refer to any authorities relating to these sections in that part of its judgment entitled, “Application of the Relevant Law”: judgment, paragraphs 35-41.

14.	It did not refer to the cases recorded as having been cited by the Respondent at paragraph 80 of its judgment.  Furthermore, in its conclusions the Tribunal did not address sections 32 or 33 of the Race Relations Act 1976 and did not make any findings as to which, if either, section applied to the facts as found by it.  Indeed, it made no express finding as to the basis for liability at all.

The Burns/Barke procedure

15.	The Notice of Appeal came before HHJ McMullen QC on the sift on 28 April 2009.  Judge McMullen asked the Tribunal to answer certain questions under the Burns/Barke procedure.  The relevant question for this appeal is set out in paragraph 1(b) of the order dated 28 April 2009.  The question says this:

“(b)  Under which section was the Respondent liable for the acts of Terri Dower and what were the reasons for that finding?”

16.	The Employment Judge answered that question by a letter dated 20 May 2009: EAT bundle, pages 89-92.  The relevant part relating to this appeal is set out in paragraphs 6-7 of that letter: EAT bundle pages, 91-92.  The Employment Judge said this:

“6	The Tribunal attached liability to the Respondent for the acts of Terri Dower, a contract worker, pursuant to Sections 32 and 33 of the Race Relations Act 1976. Those sections were set out in the relevant law part of the judgment at para 82. The reasons for attaching liability to the Respondent under these sections are set out below.
7	It is clear from the reasons contained in the judgment that at the time of the incident in July 2006, Terri Dower had been an agency worker placed with the Respondent over a period of years.  She worked under the day-to-day control of the Respondent and worked alongside employees.  She had a grade at the Respondent, she was like the Claimant a level 3 inspector and like the Claimant she undertook some level 4 responsibility and was able to take charge of a room.  The Respondent treated Terri Dower on a day-to-day basis as it treated other operatives.  She underwent training alongside them was obliged to comply with the standard operating procedures and to abide by the company's values.  If there was a dispute between workers then the line manager spoke to Terri Dower in the same manner as an employee.  For example, Mr Bernard told the Tribunal he had cause to ask Terri Dower to apologise to Balgit for upsetting her.  To all intents and purposes she was treated as an employee on a day to day basis and acted as one.  The Tribunal finds liability can therefore attach to the Respondent for the acts of the Claimant within the meaning of Section 32 of the Race Relations Act 1975.  The Tribunal finds liability not only can attach but does attach to the Respondent for the acts of Terri Dower for the reasons set out in the judgment.  The Tribunal's findings set out at paragraphs 48 and 49 of the judgment, together with the conclusions set out at paragraph 96 show the Respondent by its conduct following the Claimant raising race discrimination on 6, 7 and 13 December 2006 were complicit in allowing an environment to continue where such conduct could take place.  There was no prompt investigation.  The investigation failed to address the allegations in the investigation and while Terri Dower was removed from the contract this was ostensibly for other reasons.  The Tribunal also considered Section 33 of the Race Relations Act 1976 and found that liability attached to the Respondent under that Section as well.  The Respondent agreed it likely the incident occurred and having that knowledge failed to promptly investigate it and then did not address the allegation in its investigation. The Respondent was unwilling to explore the Claimant’s allegations and instead removed Terri Dower from the contact ostensibly for other reasons and commenced disciplinary action against the Claimant and dismissed her.  The Tribunal has found this action was victimization of the Claimant. The Respondent by its subsequent conduct knowingly aided in the acts of Terri Dower and condoned them and were liable for their conduct pursuant to section 33 of the Race Relations Act. In reaching our conclusions the Tribunal had regard to Anyanwu and other v South Bank Student Union and Another 2001 IRLR 305 HL and the words of Lord Bingham who said:
“The expression “aids” in section 33(1) is a familiar word in everyday use and it bears no technical or special meaning in this context. A person aids another if he helps or assists him. He does so whether his help is substantial and productive or whether it is not, provided the help is not so insignificant as to be negligible.  While any gloss on the clear statutory language is better avoided, the subsection points towards a relationship of cooperation or collaboration; it does not matter who instigates or initiates the relationship. It is plain that, depending on the facts, a party who aids another to do an unlawful act may also procure or induce that other to do it.  But the expressions “procure” and “induce” are found in sections 30 and 31, not section 33, and are differently enforced; they mean something different from “aids” and there is no warrant to interpreting “aids” as comprising these other expressions.”
And Lord Browne Wilkinson who said:
“Focusing on the concept of knowingly aiding, the word is used in its ordinary sense.  While there is no exact synonym the words help, assist, co-operate, or collaborate, convey more or less the right nuance. The word "aid" is therefore not used in either an extensive or a restrictive sense. The critical question is: Does the word aid in its contextual sense cover the conduct of the secondary party? It follows that it is wrong to be diverted by any inquiries not mandated by the statute as to whether the alleged aider was or was not a prime mover or a free agent.”  ”

17.	Following the receipt of that letter the Appellant amended its Notice of Appeal: EAT bundle, pages 50-53.

The Law

18.	Section 32 of the Race Relations Act 1976 provides as follows:

“32.  Liability of employers and principals
(1)	Anything done by a person in the course of his employment shall be treated for the purposes of this Act (except as regards offences thereunder) as done by his employer as well as by him, whether or not it was done with the employer’s knowledge or approval.
(2)	Anything done by a person as agent for another person with the authority (whether express or implied, and whether precedent or subsequent) of that other person shall be treated for the purposes of this Act (except as regards offences thereunder) as done by that other person as well as by him.
(3) In proceedings brought under this Act against any person in respect of an act alleged to have been done by an employee of his it shall be a defence for that person to prove that he took such steps as were reasonably practicable to prevent the employee from doing that act, or from doing in the course of his employment acts of that description.”

19.	Section 33 of the Race Relations Act 1976 provides as follows:

“33.  Aiding unlawful acts
(1)	A person who knowingly aids another person to do an act made unlawful by this Act shall be treated for the purposes of this Act as himself doing an unlawful act of the like description.
(2)	For the purposes of subsection (1) an employee or agent for whose act the employer or principal is liable under section 32 (or would be so liable but for section 32(3)) shall be deemed to aid the doing of the act by the employer or the principal.
(3)	A person does not under this section knowingly aid another to do an unlawful act if -
	(a) 	he acts in reliance on a statement made to him by that other person that, by reason of any provision of this Act, the act which he aids would not be unlawful; and
	(b)	it is reasonable for him to rely on the statement.
(4)	A person who knowingly or recklessly makes a statement such as is mentioned in subsection 3(a) which in a material respect is false or misleading commits an offence, and shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.”

The Notice of Appeal

20.	The Notice of Appeal appears at EAT bundle, pages 50-53.  It has been supplemented by Mr Mansfield’s written and oral submissions.  The Respondent’s answer appears at EAT bundle, pages 57-60.  It has been supplemented by Mr Deb’s written and oral submissions.  We are grateful to both advocates for those written and oral submissions.

21.	There are a number of grounds of appeal and we take each one in turn.

Ground 1: Employment under Section 32(1)

22.	Mr Mansfield submits that the Tribunal did not make sufficient or proper findings of fact to ground a decision that Ms Dower was an employee of the Appellant company for the purposes of section 78(1) of the Race Relations Act 1976.  The Tribunal’s findings (to which I have referred) did not address this question.

23.	Section 78 of the Race Relations Act 1976 provides as follows:

“ ‘Employment’ means employment under a contract of service or of apprenticeship or a contract personally to execute any work or labour and related expressions shall be construed accordingly.”

24.	Mr Mansfield therefore submits that the questions which the Tribunal needed to address were:
(a) 	was there a contract between Ms Dower and the Appellant company?
(b) 	was that contract a contract of service, or a contract personally to execute any work or labour? 

25.	He submits that the Tribunal addressed neither of these questions.

26.	Mr Mansfield submits that the Tribunal’s findings are inconsistent with employment status: judgment, paragraphs 3, 39 and 47.  Furthermore, the Tribunal did not address the issues raised in relation to the inference of a contract between a worker and an end user company where the worker is supplied by an agency: James v London Borough of Greenwich [2008] IRLR 302 and Stephenson v Delphi Diesel Systems Limited [2003] ICR 471.

27.	Turning to the further reasons supplied by the Employment Judge in his letter of 20 May 2009, Mr Mansfield submits that the Tribunal does not direct itself to section 78 nor to the relevant case law.  He submits that the statement in paragraph 7 of that letter that:

“To all intents and purposes she was treated as an employee on a day-to-day basis and acted as one.”

is insufficient.  In any event these are not findings set out in the judgment.

28.	Mr Deb submitted that Ms Dower was an employee of the Appellant company because she was a worker as defined by section 230(3) of the Employment Rights Act 1996.  Section 230(3) provides as follows:

“(3)	In this Act ‘worker’ (except in the phrases ‘shop worker’ and ‘betting worker’ means an individual who has entered into or works under (or, where the employment has ceased, worked under) -
	(a)	a contract of employment, or
(b)	any other contract, whether express or implied and (if it is express) whether oral or in writing, whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual;
and any reference to a worker’s contract shall be construed accordingly.”

29.	The difficulty with this submission is that section 230(1) has a different definition for “employees”.  Section 230(1) provides as follows:

“(1)	In this Act ‘employee’ means an individual who has entered into or works under (or, where the employment has ceased, worked under) a contract of employment.”

30.	It is therefore different and narrower than the definition of ‘worker’ in section 230(3).  However, it seems to us there is a further difficulty with this submission.  We are concerned with discrimination under the Race Relations Act 1976.  Section 78 has a specific interpretation provision, s. 78(1) defining employment.

31.	Mr Deb took us through the criteria for deciding who is an employee as set out in paragraph 4 of his skeleton argument and said that, looking at those criteria, Ms Dower was an employee of the Appellant company.  He further invited us to apply a “necessity test” as to the interpretation of section 78(1) of the Race Relations Act 1976 and find on the facts here that Ms Dower was employed by the Appellant company.  In the alternative, and in the absence of any contractual documentation, he invited us to imply a contract of employment on the facts.

Decision
32.	We agree with Mr Mansfield.  In this case the Employment Tribunal made an error of law in the following respects.  First, it failed to direct itself as to the appropriate legal principles as to the liability of the Appellant company for any agency workers it engaged despite being referred to the issue by Ms Balogun in her closing submissions.  Second, the Tribunal failed to give adequate reasons for its decision that the Appellant company was liable for allegation 3.1.  It singularly failed both in its written reasons and in its answer to the Burns/Barke request to identify the basis upon which the Appellant was liable for the act of Ms Dower: see judgment, paragraph 96.

33.	The Tribunal’s reasoning contained in its answer to the Burns/Barke request does not assist.  In our judgment it is quite impossible to base liability under section 32(1) on the basis that: 
“To all intents and purposes she was treated as an employee on a day‑to‑day basis and acted as one.”  

34.	There are simply no findings of primary fact which permit the Tribunal to come to that conclusion.  Indeed, having carefully read the judgment and seen the closing submissions of both Ms Balogun for the Appellant company and Mr Sheikh for the Claimant it is clear that Mr Sheikh’s submissions do not address the issue of whether or not Ms Dower was an employee of the Appellant company or an agency worker and not the Appellant company’s employee.

Ground 2:  Agency under Section 32(2)

35.	Mr Mansfield submits that it appears from the further reasons given in the Employment Judge’s letter of 20 May 2009 that the Tribunal did not rely on section 32(2).  The Employment Judge refers to section 32 without drawing any distinction between section 32(1) and section 32(2).  However, the Tribunal refers to Ms Dower being treated as an employee and makes no reference to agency.  Mr Mansfield submits that in any event there would be no basis on the Tribunal’s findings of fact for it to find that Ms Dower acted as the Appellant’s agent in carrying out the World Cup incident which is the subject matter of this appeal.

36.	Mr Mansfield further submits that for the purposes of section 32(2) of the Race Relations Act 1976 a strict common law analysis of agency principles is required and not a more general purposive interpretation: see Yearwood v Commissioner of Police for the Metropolis [2004] ICR 1660 at paragraphs 35-40 where the EAT adopted the definition set out in Bowstead and Reynolds on Agency at paragraph 1-001 (17th Edition, 2001).

37.	Mr Deb did not specifically address us on this issue.

Decision
38.	We agree with Mr Mansfield.  There are no or no adequate findings of fact in the judgment of the Employment Tribunal which could enable it to reach a conclusion that Ms Dower was an agent of the Appellant company for the purposes of section 32(2).  Neither is there any material in the Employment Judge’s letter dated 20 May 2009 either.  Indeed, we would go further.  There is no attempt to address or apply section 32(2) and no consideration of the concept of agency at all.  It follows that there cannot be liability under section 32(2).

Grounds 3-5

39.	Mr Mansfield refers us to Hallam v Avery [2001] IRLR 312 at paragraphs 8-9 and submits that in order to establish liability under section 33 the Tribunal would have needed to make the following findings:
(a)	that “another person” (i.e. Ms Dower) had done an act made unlawful by the Race Relations Act 1976;
(b)	that the Appellant company aided Ms Dower to do that act;
(c)	that the Appellant company so aided Ms Dower knowingly.

40.	The requisite knowledge and aiding is that of the unlawful act of the other party: see Hallam, supra at paragraph 9.

41.	Mr Mansfield submits that the judgment itself did not address any of these questions and made no findings in relation to them.  He further submits that the answer to the Burns/Barke request addresses only the second and third questions and in any event these are not subjected to any proper analysis.

42.	Mr Deb submits that the effect of section 33(1) is that it places a duty upon the Appellant company to provide a workplace environment free from racial discrimination.  The Appellant company had tolerated an environment which permitted racially abusive remarks to be made.

Decision 
43.	We take each of the three points raised by the Hallam case in turn.

Aiding

44.	The letter from the Employment Judge dated 20 May 2009 refers to Anyanwu and Another v Southbank Students’ Union and Southbank University [2001] IRLR 305 as authority for the proposition that the word “aids” bears no technical or special meaning and that “a person aids another if he helps or assist him”.

45.	Section 33 requires that a person aids another person to do an unlawful act.  A person cannot therefore aid another to do something which the second person has already done.  The relevant question for the Tribunal was about the Appellant company’s acts at or prior to the time that the other person did the unlawful act.  All of the matters referred to in the Employment Judge’s letter of 20 May 2009 took place after the World Cup incident had already occurred.  This is apparent in the way that the letter expresses itself:

“The Respondent by its subsequent conduct knowingly aided the acts of Terri Dower and condoned them and were liable for their conduct pursuant to section 33 of the Race Relations Act.” (our emphasis)

46.	All of the matters referred to in the letter of 20 May 2009 concerned the failure of investigation of the incident after it had occurred.  None of these matters can amount to aiding Ms Dower to commit the World Cup incident for the simple reason that by the time of these failures, the incident had already happened.

47.	The letter of 20 May 2009 also states that paragraphs 48-49 and 96 of the judgment show that the Appellant company, by its conduct following the Claimant raising race discrimination on 6, 7 and 13 December 2006:

“... were complicit in allowing an environment to continue where such conduct could take place.”

48.	Again, all of these acts occurred after the World Cup incident.  There were no findings by the Tribunal that the Appellant company allowed such an environment to exist prior to, or at the time of the World Cup incident.

49.	In any event, allowing an environment where particular conduct could take place does not amount to aiding that conduct.  Merely allowing an environment to exist does not amount to the relationship of “co-operation or collaboration” referred to in Anyanwu.  See also Hallam where a general attitude of helpfulness and co-operation was held not to be enough to constitute aiding under section 33(1).  Finally, merely allowing such an environment to exist cannot in our judgment amount to knowingly aiding conduct.

50.	There are no findings by the Employment Tribunal of any matters prior to or at the time of the World Cup incident to suggest that the Appellant company helped or assisted that incident to occur.  In relation to the only allegation raised by the Claimant prior to June 2006 (racist language in 2004) the Tribunal specifically made no finding and did not take that allegation into account: judgment, paragraph 23.

Knowingly

51.	The knowledge requirement is essential and the Tribunal should have made clear findings on it before imposing liability under this section on an individual: see Sinclair Roche and Temperley v Heard (No. 1) [2004] IRLR 763 at paragraphs 52-54 per Burton J.

52.	Although the Tribunal say in its letter of 20 May 2009 that:

“The Respondent by its subsequent conduct knowingly aided in the acts of Terri Dower,”

it does not set out the basis for a finding that the Appellant company had the requisite knowledge of those acts.  There is no basis for a finding that the Appellant company knew of Ms Dower’s act in the World Cup incident at the time that it occurred.

53.	The letter of 20 May 2009 continued:

“The Respondent agreed it likely the incident occurred and having that knowledge failed to promptly investigate it and then did not address the allegation in its investigation.”

54.	In our judgment it is clear from the findings in the substantive judgment that the Respondent was not aware of the World Cup incident until 6 December 2006: judgment, paragraphs 12 and 21.

An Act made unlawful by the Race Relations Act

55.	The Employment Tribunal did not ask itself the question that assuming the Appellant company aided Ms Dower to do an act, i.e. the World Cup incident, would that act be unlawful if done by Ms Dower?

56.	There is only one answer to that question on the Tribunal’s findings of fact and it is no.  The Claimant’s claim of discrimination is brought under section 4(2)(c) of the Race Relations Act 1976.  That is one of a number of sections concerned with discrimination in employment.  A necessary element is a relationship of employment between a claimant and a respondent.  Section 4(2) provides that:

“(2) It is unlawful for a person, in the case of a person employed by him at an establishment in Great Britain, to discriminate against that employee -
(c) by dismissing him, or subjecting him to any other detriment.”

57.	It would be impossible for the Claimant to bring a claim under section 4(2)(c) against Ms Dower as the Claimant was not employed by Ms Dower.  Thus Ms Dower’s act was not unlawful in itself.  If it was not unlawful in itself then the Appellant company cannot be liable for knowingly aiding that act.

58.	For these reasons the Tribunal erred in law in fixing the Appellant company with liability for the World Cup incident under section 33(1) of the Race Relations Act 1976.

Ground 6:  Control over acts of a third party

59.	The Respondent’s Answer sets out a further basis for liability, namely that an employer will be liable for unlawful race discrimination by a third party where the employer has sufficient control over the circumstances to have prevented it.

60.	As Mr Mansfield pointed out in his skeleton argument the fatal flaw is that this proposition relies on the principle derived from Burton v De Vere Hotels [1997] ICR 1.  That proposition was expressly disapproved by the House of Lords in Pearce v Governing Body of Mayfield Secondary School [2003] ICR 937.

61.	Furthermore, the Claimant’s case was not put to the Tribunal on this basis and neither the judgment nor the letter of 20 May 2009 find liability on this basis.  The Tribunal made no relevant finding sufficient to ground a claim on this basis even if it was open to them to do so as a matter of law (which it was not).

Ground 7: Vicarious Liability

62.	Mr Deb submitted that vicarious liability was established on the facts of this case in respect of the World Cup incident in June 2006.  He referred me to his skeleton argument at paragraph 12 and the decision of the Court of Appeal in Cavil and Wireless PLC v Muscat [2006] EWCA Civ 220.  He submitted that the Appellant company derived benefit from Ms Dower’s work for it and therefore it was vicariously liable for her actions during the World Cup incident.

63.	Mr Mansfield submitted that vicarious liability is a common law concept and liability in this case could only arise under the Race Relations Act 1976.  The specific statutory provisions which could found liability are sections 32 and 33 only.  Furthermore, there was simply no contractual documentation before the Tribunal which could evidence the relationship between the Appellant company and Ms Dower which on the findings of fact that it made (and which I have recited above) could permit the Tribunal to find that Ms Dower’s services to the Appellant company were provided by way of an agency agreement with Adecco.

Decision
64.	We agree with Mr Mansfield.  Liability in this case could only arise under sections 32 or 33 of the Race Relations Act 1976.  The Claimant’s case was not advanced before the Employment Tribunal on the basis that the Appellant company was vicariously liable for the actions of Ms Dower.  The Tribunal made no adequate findings of fact on that issue and it is simply not open to the Claimant to argue that point in the Employment Appeal Tribunal:  Jones v The Governing Body of Burdett Coutts School [1998] IRLR 521.

Conclusion

65.	For these reasons the appeal is allowed.  All the facts have been found by the Employment Tribunal and there is nothing to remit to it.  On the basis of the errors of law, the Employment Tribunal was not entitled to conclude that the Appellant company was liable to the Claimant for the World Cup incident and the comments by Ms Terri Dower.

66.	We therefore set aside paragraph (i) of the judgment at EAT bundle, page 1.  We substitute a decision that the allegation of direct discrimination at paragraph 3.1 of the judgment is dismissed.  It also follows that the award of compensation of £2,500 be set aside: see remedy judgment paragraph 1(ii)(1): EAT bundle, page 61.  The interest award at remedy, judgment paragraph 1(ii)(3) will also need to be adjusted to ₤107.25.