Updates in Employment Law in November

Case of the month: Transgender athletes facing discrimination in Sports – Semenya v Switzerland 2023

Trans- rights have become one of the most strongly challenged equality issues of our time. There is a public debate about whether it is ever fair to exclude trans-women or trans-men from single -sex activities or facilities. Sport is one of the key battlegrounds, with these issues being debated by sporting regulators and, increasingly, the courts. It seems to be widely accepted if trans-men wish to compete in men’s sports. However, it is debated whether it is fair and safe for trans-athletes to compete against natal female athletes in women’s sport, and on what terms. Currently, virtually all sporting bodies (such as the International Olympic Committee) allow such competition without requiring surgery, providing that the trans-athlete consistently declares their gender as female and demonstrates reduced testosterone levels for at least one year prior to the competition and during it. The thinking is that participation in sport as appropriate to one’s gender identity is a human rights issue and both safety and fairness issues can be addressed through the testosterone suppression requirement.

A Human Rights Breakthrough in Sports Law?
A breakthrough in the case of Semenya v Switzerland 2023, where an international-level athlete Mokgadi Caster Semenya had been discriminated against by the Eligibility Regulations for Female Classification (‘Athlete with Differences of Sexual Development’. DSD Regulations) of the International Association of Athletics Federations (IAAF, now World Athletics). These regulations required her to undergo hormone treatment to lower her natural testosterone levels in order to be admitted to international competitions in the female category. The European Courts of Human Rights (ECtHR) found in its Chamber judgement that Switzerland had violated the Convention by failing to provide sufficient institutional and procedural safeguards to enable Ms. Semenya to have her discrimination complaints effectively examined. The decision in this case is noteworthy for several reasons. Among them is the fact that the ECtHR takes a human rights-based stand on one of the ‘big issues in athletics’-that is discrimination related to gender and sex. Moreover, the judgement clarifies the enforcement of human rights protection in the framework of sports law.

The Equality and Human Rights Commission (EHRC) has taken the unprecedented step of criticising UK Athletics (UKA) for its “inaccurate” interpretation of the law after UKA announced plans for a new transgender policy which came into effect from 1 August 2023.
The EHRC’s intervention came hours after UKA said it wanted to ban transgender women from female events on fairness grounds – but it would be too “risky” to do so unless the government changes the law.

However, the EHRC, the body responsible for promoting and upholding equality and human rights ideals and laws across England, Scotland and Wales, said that it had told UKA that it was wrong, and that such a ban was justified, beforehand.

It said it had made clear that section 195 of the 2010 Equality Act allows sports to restrict competition in the female category on safety and fairness grounds, a position government sources also reiterated.

Recent case in the news sports is a female transgender footballer Francesca Needham is considering taking legal action for discrimination after a series of rival teams ‘refused to play against her’. She believes there has been a breach of a code of conduct regarding diversity and inclusion, as well as safeguarding of adults in football established by both the Football Association and the Sheffield and Hallamshire Women and Girls League.

What does the law entail?

The starting point in discrimination law terms is the Equality Act 2010. The Act prohibits various forms of discrimination on the basis of sex or gender reassignment but sets out exemptions for sporting activities in which “the physical strength, stamina or physique of average persons of one sex would put them at a disadvantage compared to average persons of the other sex as competitors in events involving the activity”. That covers most sports, with perhaps some exceptions for equestrian sports and shooting. It is lawful to restrict the participation of people undergoing gender reassignment if necessary to secure fair competition or the safety of competitors.

Three key points are worth bearing in mind. First, the Act doesn’t protect everyone who may consider themselves trans-, or non-binary -only those who have undergone, are undergoing or plan to undergo gender reassignment. This doesn’t always require surgery but does require more than self -declaration. Second, in discrimination law, ‘necessary’ usually means that there is no less discriminatory alternative to achieve the desired result – so any restrictions need clear justification backed up by evidence.

Finally, what constitutes ‘fair’ and ‘safe’ in the context of sport is not a straightforward issue. All sport involves risks to the competitors -particularly contact sports- so there would need to be clear evidence of additional risks going beyond what is reasonable for the sport in order to justify restrictions.

Equality Act Amendments
The government has released a preliminary legal proposal aiming to amend the Equality Act of 2010, set to take effect on January 1st, 2024. The Equality Act 2010 (Amendment) Regulations 2023 codify certain EU-derived discrimination protections which would otherwise have disappeared at the end of this year due to Brexit.

• Key amendments include:
  The right to claim indirect discrimination by association (to cover a person who does not hold the relevant protected characteristic but suffers the same disadvantage at the hands of the employer’s practices as those who do have that characteristic)
• An amendment to guidance on the definition of disability to state that consideration of a person’s ability to participate fully and effectively in working life on an equal basis with other workers is relevant when looking at ‘day-to-day activities.
• A ‘single source’ test for establishing an equal pay comparator (the idea that an equal pay comparator can potentially work for a different business so long as the body responsible for setting terms is the same)
• An extension of direct discrimination protection to cover discriminatory statements made about not wanting to recruit people with certain protected characteristics even where there is no active recruitment process ongoing and no identifiable victim.
• Confirmation that employment discrimination on grounds of breastfeeding falls under the protected characteristic of sex.

Employment Rights (Amendment, Revocation & Transitional Provision) Regulations 2023
The government has published a draft statutory instrument containing amendments to the law on holiday pay, TUPE and working time. The changes, which are likely to come into force on 1 January 2024, include:

• Simplifying holiday pay calculations by making rolled-up holiday pay (12.07% of pay) lawful for part-year workers and those who work irregular hours;
• Restating various pieces of retained EU case law (to make it clear it remains part of UK law, post Brexit) to allow carry over of:
• All statutory annual leave to the following year when a worker is unable to take their leave due to being on family related leave;
• Regulation 13 leave (4 weeks per year) for a maximum of 18 months where a worker is unable to take their leave due to sickness; and
• Regulation 13 leave where the worker has not been given opportunity to take the leave or the employer has failed to inform them that any leave not taken and which cannot be carried over will be lost.
• Defining ‘normal remuneration’ for the purposes of holiday pay for Regulation 13 leave to include commission payments and other payments, such as regular overtime payments.
• Removing the additional working time record keeping requirements set out in the ECJ judgment in CCOO v Deutsche Bank (which had held working hours and rest records must be kept for almost all members of the workforce, even if they worked regular hours).
• Allowing small businesses (with fewer than 50 employees) doing TUPE transfers of any size, and businesses of any size undertaking a small transfer (of fewer than 10 employees) to consult their employees directly if there are no existing representatives in place.

Trade Union Recognition – Independent Workers Union of Great Britain v CAC
Was the CAC correct to refuse a trade union’s application for recognition in respect of a group of riders, working for Deliveroo, who were not required to provide personal service?

Yes, held the Supreme Court in Independent Workers Union of Great Britain v CAC

The CAC had refused to accept the Union’s application on the basis that the riders were not ‘workers’ of Deliveroo within the meaning of the Trade Union and Labour Relations (Consolidation) Act 1992. Riders were not required to provide personal service and they were allowed to use substitutes.

The Union appealed the refusal on the basis that it breached Article 11 of the European Convention on Human Rights, arguing that the definition of ‘worker’ in the Act should have been construed to give effect to Article 11. Article 11 protects the right to freedom of association and to form and join a trade union.

European case law makes it clear that the Article 11 right to form and join a trade union only exists within the European concept of an employment relationship. The Supreme Court had to have regard to the factors set out in the International Labour Organisation Employment Relationship Recommendation, 2006 No 198, in considering whether the riders were employees.

The Recommendation focuses on a multi-factoral approach looking at performance of the work and remuneration of the worker. Applying this test, the Supreme Court held that the riders were not in an employment relationship so the provisions of Article 11, which protect trade union activity, did not apply to them. The CAC was correct to refuse the application for recognition.

Gender pay gap data published
The Office for National Statistics (ONS) has released gender pay gap information for the UK in 2023. The data covers differences in pay between men and women by age, region, full-time and part-time, and occupation. The gender pay gap in April 2023 stands at 14.3% among all employees (down from 14.4% in 2022), 7.7% for full-time employees (up from 7.6% in 2022) and -3.3% for part-time employees (unchanged from 2022).

National Minimum Wage Increase
On Tuesday, November 21st, the Government announced that it has accepted the Low Pay Commission’s recommendations on minimum wage rates to apply from 1 April 2024. This is the largest ever increase to the minimum wage in cash terms. The National Living Wage will apply to all workers aged 21 and over for the first time (previously applying only to those aged 23 and over).

The annual increases to the minimum wage and national living wage with effect from 1 April 2024 are as follows:

• 21 and over – £11.44 (increase of £1.02)
• 18-20 – £8.60 (increase of £1.11)
• 16-17 and apprentices – £6.40 (increase of £1.12)
• The accommodation offset will be £9.99 per day (increase of 89p).

National Insurance Contributions
From 6 January 2024, employee’s national insurance contributions will be cut from 12 percent to 10 percent for earnings between the primary threshold (£242 per week) and the upper earnings limit (£967 per week). The 2 percent rate for employees above the upper earnings limit and the employers’ 13.8 percent rate will remain. There are 45 days from the announcement (including Christmas and the New Year) for employers and their payroll providers to change their systems to reflect this change.

The self-employed, including partners, will wait until 6 April 2024 for their equivalent NIC rate to reduce from 9 percent to 8 percent. Whilst the weekly flat rate £3.45 compulsory class 2 contributions will be abolished from that date, individuals with profits less than £6,725 per annum will continue to pay voluntary contributions if they wish to receive benefits such as the state pension in the future. In addition, the simplified cash basis for calculating taxable profits will become the default method and the turnover, interest and loss relief restrictions will be removed. This may help unincorporated businesses as they move to a current year basis for calculating taxable income.

By Suraj Purohit.
Employment Paralegal at Kalra Legal Group