Firms fear new equality laws

The twin-headed spectre of sex and religion is poised to catch thousands of British employers off guard from today, when the biggest shake up in equal opportunity rights for a generation comes into force.

City lawyers have been inundated with requests from companies and banks to update them on employment policies and internal disciplinary procedures to cope with regulations on sexual orientation and religious belief – the first of its kind.

Employers are particularly worried by a new statutory offence of harassment, which could spell the end of office banter – particulary prevalent on the male-dominated trading floors of the City’s banks.

Money broker Cantor Fitzgerald, which this summer lost a £1m constructive dismissal case to its former trader Steve Horkulak because of obscenity-laced bullying from his boss, has warned its London staff about ‘innocent comments’ which could backfire.

A note to Cantor’s human resources department from external lawyers Olswang headed ‘Sex, God and discrimination’, warns employment tribunals ‘will take account of the perception of victim and so an over-sensitive individual who takes offence at an innocent comment may be covered’. Their employment policies have been updated and staff informed.

Experts are worried about the broad definition given to religion or belief which extends equal rights protection beyond the established religions to any ‘similar philosophical belief.’

Tim Russell, head of employment at lawyers Norton Rose said: ‘From atheists to Church of Scientology they would have to be covered, provided the belief affected in a substantial way how they lived their lives.’

Big companies had been the most prepared, Russell added, with ‘four or five having updated their employment policies in the past couple of months’.

Banks with new policies that make explicit reference to the new regulations in its policies include investment bank Investec which this autumn settled a high-profile sex discrimination and unfair dismissal claim with former analyst Louise Barton.

Investec admitted to an employment tribunal 18 months ago that it did not have any formal equal opportunities policies when it was battling with Barton.

Alarm over scope to sue

The new discrimination regulations are alarming City employers as they give staff almost unlimited scope to call foul and, worse, lets them complain far sooner in their careers.

Previously, staff would generally file for discrimination if they were also claiming unfair dismissal – an option only open after a year in employment.

Now the grounds for discrimination have multiplied – you don’t have to be gay or female to claim ‘harassment’ over anti-gay or anti-women jokes – and discrimination claims can be brought at any time in employment.

With no cap on discrimination compensation, the temptation to sue may be irresistible.

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