Arguments over the operation of the burden of proof are common in discrimination cases.
When considering a discrimination claim, the Employment Tribunal (ET) will normally go through two stages. Stage 1 is to examine whether the employee has made out a prima facie case – i.e. has established facts from which, in the absence of an adequate explanation, the ET could conclude that there has been unlawful discrimination on the part of the employer. If that is achieved, the second stage is that the burden of proof then shifts to the employer to prove, on the balance of probabilities, that he has not committed an act of unlawful discrimination. This could be by demonstrating an adequate non-discriminatory explanation of the treatment being complained of. If the employer fails to do this, the ET must uphold the discrimination claim. However, the Court of Appeal has ruled that the two stages cannot always be clearly identified.
In 2005, in the case of Igen v Wong, the Court of Appeal analysed the law regarding the burden of proof in discrimination cases and included a summary of guidance on the construction of the relevant statutory provisions. However, there still seems to be confusion on the issue and it is important that the law regarding the burden of proof to be applied, when the facts of an individual case are being examined, is clearly understood.
In Madarassy v Nomura International plc, the Court of Appeal heard a complaint that the ET had misunderstood the burden of proof and so had rejected a well-founded claim.
Ms Madarassy started working for Nomura in January 2000, as a senior banker. In June of that year she became pregnant. After her initial probationary period, her appointment was confirmed in September 2000, although her line manager expressed concerns about her performance. Two months later, Ms Madarassy informed her employer of her pregnancy. In February 2001, an appraisal assessed her performance as not being up to the company’s standard.
In July 2001, when Ms Madarassy returned to work after her maternity leave, Nomura had begun making redundancies, as a result of a restructuring of the company. In November, Ms Madarassy was herself made redundant.
She claimed that she had been unfairly dismissed for a reason connected with her pregnancy or maternity, that she had been victimised and she made 33 allegations of unlawful discrimination on the grounds of her sex.
The ET judged that only three of the allegations of sex discrimination were well-founded. It dismissed the complaint of victimisation and rejected the unfair dismissal claim. In its view, Nomura had carried out a fair redundancy consultation process.
It is worth pointing out that the ET hearing took place before subsequent judicial rulings clarified the law on the burden of proof in discrimination claims. Ms Madarassy appealed to the Employment Appeal Tribunal (EAT) regarding the sex discrimination claims. The main ground of appeal was that the ET had erred in law with regard to the burden of proof. It had only scrutinised Ms Madarassy’s case and rejected it. It should have gone on to examine Nomura’s case and rejected the adequacy of its explanation for its discriminatory treatment of her. It had therefore placed the burden on her to prove all the elements of her claims and had failed to place on Nomura the burden of proving that it did not commit the acts of unlawful discrimination that made up her complaint. The EAT dismissed the appeal with regard to all but two of the claims.
The Court of Appeal had to decide whether the ET had erred in law when reaching its decision with regard to the allegations of sex discrimination.
The Court reaffirmed that the guidance given in Igen v Wong on the operation of the burden of proof in discrimination cases is ‘clear and sound’ and does not need to be altered. However, it is only guidance and so failing to follow it absolutely is not in itself an error of law, although omitting to refer to the guidance may increase the risk of an error. With regard to the two stage process, in practice the ET does not hear the evidence and the argument in two stages. Evidence from the employer in rebutting the complainant’s evidence of discrimination can be relevant in deciding that there is nothing in the claimant’s evidence which could infer a prima facie case of discrimination. After hearing all the evidence, the ET embarks on a two stage analysis to decide firstly whether a prima facie case has been established so that the burden of proof shifts to the employer and, if so, whether the employer has discharged the burden of proof.
In the Court’s view, the ET had dealt with the burden of proof in two stages, placing the burden of proof on Nomura at the second stage, not at the first. At stage 1, under the law as it now stands, it is necessary for the claimant to prove that the employer committed an unlawful act, not merely that they could have done so.
Following the Court of Appeal’s decision, the three disputed findings will be remitted to the original ET to review its decision.