UK EAT comments on cost-plus approach in religious discrimination decision

This post was written by Lee Howard.

A recent Employment Appeal Tribunal decision, Cherfi v G4S Security Services Ltd [2011], deals with indirect religious discrimination and offers employers further guidance on how they might deal the issue of time off work for reasons concerning religion. It may also aid those seeking to justify ostensibly discriminatory practices on the grounds of cost.

What happened in this case?

The employer, G4S, was bound under the terms of one of its client contracts to provide a prescribed number of security guards on site at all times during operational hours. The employee, Mr Cherfi, was a Muslim who frequently left the client’s site on Friday lunchtimes to attend prayers at a Mosque. G4S informed Mr Cherfi in 2008 that he would no longer be able to leave the site at lunchtimes, as G4S would be in breach of its contract if the requisite number of guards were not present at the client’s site.

G4S made a number of efforts to accommodate Mr Cherfi, offering him an amended work pattern of Monday to Thursday, with the option of working Saturday or Sunday so that he would not suffer financially. However, Mr Cherfi did not wish to work at weekends, and discussions did not result in agreement.

Thereafter, Mr Cherfi ensured that he was not present at work on Fridays, by either taking sick leave, annual leave or authorised unpaid leave. When G4S expressed discontent with this situation, he brought a claim for indirect discrimination, arguing that Muslims were put at a particular disadvantage by the employer’s requirement for all security guards to remain on site on Friday lunchtimes.

The relevant law

To prove that G4S was guilty of indirect religious discrimination, Mr Cherfi needed to show that this requirement that applied to Mr Cherfi:

  • would have applied equally to persons not of the same religion as Mr Cherfi;
  • put or would have put persons of Mr Cherfi’s religion at a particular disadvantage when compared to other persons;
  • put Mr Cherfi at that disadvantage; and
  • could not be objectively justified by G4S showing it to be a proportionate means of achieving a legitimate aim.

The Employment Tribunal’s decision

The Tribunal found that this test had not been met. It considered several factors in concluding that the requirement for all security staff to remain on site all day Friday was a proportionate means of achieving a legitimate aim (that aim being to meet G4S’s operational needs). First, G4S would suffer financial penalties and risk losing the contract with its client if it failed to ensure the requisite number of security guards was present. Secondly, the only way for G4S to fulfil this requirement in an economically viable way was to engage its security staff on 8 hours shifts (i.e. the lunch period taken off by Mr Cherfi could not be covered). Thirdly, G4S had sought to offer Mr Cherfi alternative working hours without pressurising him, but he had refused. Finally, while the requirement did prevent Mr Cherfi from attending prayers at the Mosque, there was a prayer room on site which he could use.

The EAT’s verdict

The EAT upheld the Tribunal’s judgment, finding that the Tribunal had carried out the necessary balancing exercise between the operational needs of the employer and the disadvantageous effect on the employee and was right to conclude there was no indirect discrimination.

What does this case mean for employers?

Cherfi adds to an increasing body of case law dealing with religious days or time off to attend religious observances. G4S’s accommodating approach was clearly a factor in the EAT’s decision that their response had been proportionate and employers should be mindful of this.

Of particular interest to employers will be the comments made by the EAT on the issue of costs as a potential objective justification for an apparently discriminatory policy. For several years now, a “cost plus” approach has prevailed in the Courts, meaning that employers would struggle to rely on cost alone as justification and would be expected to show more. Cherfi is not a case where costs alone were used to justify the practice. However, the EAT said that it would have “taken as correct” the approach suggested in another EAT case, Woodcock v North Cumbria Primary Care Trust [2011], that as long as a policy is proportionate, costs alone might justify that policy. The EAT in that case said that adopting a rule where costs alone will not suffice “tends to involve parties and tribunals in artificial game-playing – “find the other factor” – of a kind which is likely to produce arbitrary and complicated reasoning: deciding where “cost” stops and other factors start is not straightforward”. The EAT in that case did not depart from the “cost plus” approach, but it certainly cast some doubt on it. Nor do the comments of the EAT in Cherfi amount to a total reversal of the previous approach, but they do go some way to suggesting that cost implications alone may be capable of providing objective justification.

This case therefore throws some doubt on the “cost plus” approach and may mark a subtle shift in the way the EAT is prepared to consider costs implications.