Madarassy v Nomura International Plc, England and Wales Court of Appeal (Civil Division), Judgment, Law, casemine.com

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Attorney(S)

MR ROBIN ALLEN QC and MR JONATHAN COHEN(instructed by Messrs Palmer Wade) for the Appellant
MR PAUL GOULDING QC and MS CLAIRE WEIR (instructed by Messrs Osborne Clarke) for the Respondent

Judges

LORD JUSTICE MUMMERY
LORD JUSTICE MAURICE KAY
LORD JUSTICE LAWS

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Madarassy v. Nomura International Plc

Smart Summary

Factual and Procedural Background

This appeal concerns a sex discrimination claim brought by the Appellant against the Respondent, Company A, a multi-service financial institution. The Appellant was employed by Company A as a Senior Banker from January 2000 until her dismissal on 22 November 2001. During her employment, she became pregnant and alleged multiple acts of sex discrimination, victimisation, and unfair dismissal related to her pregnancy and maternity leave.

The Appellant presented an originating application to the employment tribunal on 14 December 2001, specifying 33 separate allegations of sex discrimination spanning her employment period. The employment tribunal held a lengthy hearing over 21 days, heard 38 witnesses, and issued extended reasons dismissing all but one allegation related to a failure to carry out a health and safety risk assessment concerning her pregnancy.

The tribunal found that the dismissal was due to redundancy following a fair selection procedure and rejected claims that it was connected to pregnancy or maternity leave.

The Appellant appealed to the Employment Appeal Tribunal (EAT) on the sex discrimination claims. The EAT dismissed the appeal except for two allegations which were remitted to the same tribunal for review. The EAT allowed the Respondent's cross-appeal on the health and safety risk assessment claim, setting aside the tribunal’s earlier finding and remitting the matter for reconsideration. The EAT also ordered costs against the Appellant for unreasonable conduct during the appeal.

Permission to appeal to this court was granted with limitations. The appeal hearing was adjourned due to extraordinary circumstances and later resumed.

Legal Issues Presented

Whether the employment tribunal erred in its understanding and application of the burden of proof under section 63A(2) of the Sex Discrimination Act 1975 as amended.
Whether the tribunal misdirected itself in its approach to evidence and findings of fact, particularly regarding the requirement for corroboration.
Whether the tribunal erred in requiring a hypothetical male comparator in pregnancy and maternity discrimination claims.
Whether the tribunal correctly applied statutory time limits and the doctrine of continuing acts in discrimination claims.
The correctness of the Employment Appeal Tribunal’s decision to remit certain allegations to the same tribunal rather than a different one, and whether the remittal should be for review or re-hearing.
The validity of the health and safety risk assessment claim and the applicable legal standards under the Management of Health and Safety at Work Regulations 1999.
The propriety of the costs order made against the Appellant for unreasonable conduct during the appeal.

Arguments of the Parties

Appellant's Arguments

The employment tribunal misdirected itself on the burden of proof by placing the onus entirely on the Appellant to prove discrimination, contrary to the statutory reversal of burden under section 63A(2) and the guidance in Igen v. Wong.
The tribunal erred in its evidential approach by requiring corroboration where none was necessary and by dismissing evidence as non-existent when the Appellant had testified.
The tribunal wrongly required a hypothetical male comparator in pregnancy discrimination claims, contrary to established case law that no comparator is needed in such cases.
The tribunal erred in its application of time limits, particularly in treating some acts as isolated rather than part of a continuing discriminatory course of conduct.
The Employment Appeal Tribunal should have remitted the allegations for re-hearing by a different tribunal due to the passage of time, perceived bias, and the flawed original decision.
The health and safety risk assessment claim was valid and should have been upheld because the employer failed to carry out a required risk assessment irrespective of proof of actual risk.
The costs order against the Appellant was unjustified as she withdrew some allegations following a costs warning and should not have been penalized for costs incurred after withdrawal.

Respondent's Arguments

The tribunal’s burden of proof direction was consistent with the amended statutory provisions and the authoritative guidance in Igen v. Wong.
The tribunal properly assessed evidence and made factual findings based on the credibility and sufficiency of the Appellant’s evidence.
A hypothetical male comparator is relevant in pregnancy discrimination claims except in limited circumstances such as dismissal for pregnancy.
The tribunal correctly applied the statutory time limits and the doctrine of continuing acts, and there was no error in refusing to extend time.
The Employment Appeal Tribunal acted within its discretion in remitting the matters to the same tribunal, which was best placed to deal with the factual background efficiently and fairly.
The health and safety risk assessment claim was wrongly upheld by the employment tribunal as there was no evidence of a risk requiring assessment under the relevant regulations.
The costs order was justified due to the Appellant’s unreasonable conduct in making and pursuing unsubstantiated allegations of bias and misconduct.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Igen v. Wong [2005] EWCA 142	Construction and application of burden of proof provisions in discrimination cases, clarifying the two-stage analysis under amended legislation.	The court relied heavily on Igen v. Wong for authoritative guidance on the burden of proof, affirming that the tribunal’s approach was consistent with the ruling and rejecting the Appellant’s contention of misdirection.
King v. Great Britain-China Centre [1992] ICR 516	Previous framework for burden of proof in discrimination claims before statutory reversal provisions.	The court distinguished the pre-amendment law applied by the tribunal from the current law, confirming that the amendments changed the burden of proof regime.
Shamoon v. Chief Constable of the Royal Ulster Constabulary [2003] ICR 337	Flexibility in approach to hypothetical comparators and burden of proof analysis in discrimination claims.	The court accepted that tribunals may proceed directly to the second stage in cases involving hypothetical comparators without error of law.
Webb v. EMO Air Cargo (UK) Ltd (No 2) [1995] ICR 1021	Pregnancy discrimination claims do not require a comparator for establishing less favourable treatment.	The court rejected the Appellant’s argument that the tribunal erred by referring to a hypothetical male comparator in pregnancy-related claims, noting the factual context and that comparator use was not necessarily erroneous.
Sinclair Roche & Temperley v. Heard [2004] IRLR 763	Guidance on remission of appeals to the same or different tribunal.	The court applied the principles from this case in upholding the Employment Appeal Tribunal’s discretion to remit the allegations to the same tribunal.
Hardman v. Mallon t/a Orchard Lodge Nursing Home [2002] IRLR 516	Disparate impact and automatic unlawful discrimination arising from failures to conduct risk assessments under health and safety regulations.	Cited in relation to the health and safety risk assessment ground; the court found the employment tribunal erred in law by failing to find evidence of risk required to trigger the employer’s obligation.
Amec Capital Projects Ltd v. Whitefriars City Estates Ltd [2004] EWCA Civ 1418	Principles governing risk of bias and fairness in tribunal remittals.	The court found no real risk of apparent bias in remitting the matter to the original tribunal, applying the principles from this case.
Commissioner of Police of the Metropolis v. Hendricks [2003] ICR 530	Consideration of continuing acts and just and equitable extensions of time in discrimination claims.	The court distinguished this case from the present facts, finding no error in the tribunal’s approach to time limits.

Court's Reasoning and Analysis

The court undertook a detailed examination of the burden of proof provisions under section 63A(2) of the Sex Discrimination Act 1975 as amended, and related case law, particularly Igen v. Wong. It clarified that the burden of proof involves a two-stage process: first, the complainant must prove facts from which a reasonable tribunal could conclude unlawful discrimination in the absence of an adequate explanation; second, the burden shifts to the respondent to prove that no unlawful discrimination occurred by providing an adequate non-discriminatory explanation.

The court found that the employment tribunal’s direction in paragraph 175 did not misplace the burden of proof. The tribunal considered whether the Appellant was treated less favourably than a hypothetical male comparator and only then asked whether the Respondent had provided an adequate explanation. The tribunal’s approach was consistent with the statutory framework and judicial guidance.

The court rejected the Appellant’s contention that the burden of proof shifted simply upon proof of difference in status and treatment, noting that this is insufficient without more to establish a prima facie case. It emphasized that all evidence, including that from the respondent, may be considered at the first stage except the absence of an adequate explanation.

Regarding the requirement of a comparator in pregnancy discrimination claims, the court held that the use of a hypothetical male comparator is not invariably erroneous and depends on the factual context of each allegation. The tribunal’s use of comparators here was a matter of fact and not law.

The court found no error in the tribunal’s application of time limits or its refusal to extend time, distinguishing the facts from cases where time issues were decided prematurely.

On the health and safety risk assessment claim, the court agreed with the Employment Appeal Tribunal that the employment tribunal erred by failing to find evidence of a risk to health or safety requiring an assessment under the relevant regulations.

The court upheld the Employment Appeal Tribunal’s discretion to remit the remaining allegations to the same tribunal, finding no real risk of bias or unfairness despite the passage of time and prior findings.

On the costs order, the court reasoned that the Employment Appeal Tribunal was entitled to find the Appellant’s conduct unreasonable in making and pursuing unsubstantiated allegations, justifying the costs award against her.

Holding and Implications

The court’s final decision is to DISMISS the appeal in its entirety.

The court held that there was no error of law in the employment tribunal’s decision on the burden of proof, approach to evidence, comparator issues in pregnancy discrimination, time limits, or other grounds challenged. It also found no error in the Employment Appeal Tribunal’s decisions to remit certain allegations to the same tribunal and to order costs against the Appellant for unreasonable conduct.

The implications of this decision are limited to the parties involved: the Appellant’s claims remain largely dismissed, with limited matters remitted for review by the original tribunal. No new precedent was established, and the ruling affirms the existing authoritative guidance on burden of proof in discrimination cases as set out in Igen v. Wong and related authorities.