The New Discrimination Battlegrounds

Written by Malcolm Bruce MP and published in Inbusiness Website on Wed 28th Jul 2004

The women currently making headlines for their high profile lawsuits against City investment banks may not think they have much in common with UKIP MEP Godfrey Bloom, but the fact is both have brought the debate about workplace discrimination back to the fore of political debate.

Unfortunately, without having even achieved the most basic element of employment reform - equal pay - the debate has moved in a more subtle direction. The questions now being asked are: will the rights designed to empower women, ethnic groups, gay people, disabled people and older people effectively muscle them out of the labour market? Will the new discrimination be against those most likely to turn litigious?

The answer is no, but with legislation banning discrimination in employment on the grounds of religion and sexual orientation bedding in, and new legislation coming into force in December 2006 relating to disability and age employment discrimination, more questions are going to arise over the practicality of equality regulations in the working environment.

The Government has announced its intention to create a Single Equality Body. This organisation will enforce the above legislation - which is driven by the EC Employment Directive - in addition to current laws dealing with discrimination on the grounds of sex, race and disability.

It is reasonable to question whether one body can adequately protect the rights of each diverse group. Protection from discrimination is enshrined in many separate pieces of legislation, each addressing distinct groups individually, and protection varies from group to group as a result. The 'hierarchy of equality' that has developed will inevitably be carried through into the operation of the Single Equality Body.

As my colleague Lord Lester of Herne Hill pointed out when introducing his Equality Bill in 2003, the approach of successive governments to the increasingly complex state of equality provision has been to add even more layers of legislation. The expert legal advice needed to navigate a way through this legislative maze can place huge burdens on employers and tribunals in terms of protracted and expensive litigation.

Had Lord Lester's bill been accepted we would have had a single, accessible and transparent piece of equality legislation.

The ineffectiveness of current legislation is most striking in the continuing pay gap between men and women. There has been no progress in closing the full-time gender pay gap since the mid 90's. According to the Equal Opportunities Commission the average full-time monthly pay (including bonuses and overtime payments) a woman takes home is 25% less than that of her male counterpart. This equates, on average, to her earning £7,000 less a year.

Despite girls getting better A level results they are still going into full-time employment at a lower wage than the boys they went to school with. It doesn't matter what rank they rise to, the inequality of wage remains.

Around two-thirds of women who work part time are mothers with children under five. For these women, the inequalities of wage are even greater and the pay gap stretches to over 40%. Providing affordable child-care, especially for the lower-paid, is an important step in helping mothers return to better paid, full-time employment. The Liberal Democrats think that the money being spent on child trust funds would be better spent providing this.

Discrimination places economic burdens on both the individual who cannot get a job and the state which has to support him or her as a result. The economy on the whole is distorted by the misallocation of labour. Low employment among older workers alone is estimated by the Cabinet Office to reduce GDP by around £16billion.

Awareness of age discrimination significantly lags behind awareness of discrimination on the grounds of race or sex. When investigating age discrimination the Lords Economic Affairs Committee concluded that few employers operated overtly ageist recruitment and retention policies, and that age discrimination was more often an unconscious outcome of human resource management. Nevertheless, their findings pointed to significant levels of age discrimination in the UK.

Far from setting an example to business, the Government is itself one of the worst perpetrators of age discrimination. Most civil servants retire at 60 and although the Government has stated this should rise to 65 for new entrants, Ministers admit that the public sector has not been as flexible as the 'more enlightened people' in the private sector.

The Liberal Democrats do not believe there should be a mandatory retirement age. The concept that 65 is the age when people can no longer make a valuable contribution - irrespective of their job, their abilities or their desire to work - is frankly absurd. This is backed up by a recent survey conducted by Age Concern which shows that a staggering 93% of people think workers should have a legal right to continue working past 65 if they want to and if they are still able to do the job. It's about time Labour applied 'Choice' where it was most wanted.

We still do not know how the Government will implement the EC Employment Directive in relation to age discrimination. Division remains at the highest level of Government over whether or not to scrap the mandatory retirement age, with the DTI and DWP taking up opposing positions. In this argument the DTI's attempt to promote the interests of business is misplaced. By proposing a default retirement age of 70 the Department is simply setting a new age at which employees can be forced out of their jobs. Employers will continue to discriminate against older workers, reducing their recruitment pool and discarding a skills base and work ethic the younger generation of employees often lack.

The impact of discrimination legislation on business is not insignificant, particularly in the SME sector. The Government estimates that coping with new guidance on age discrimination alone will cost the average small business £122 and 5 hours reading time.

The 'enlightened' employers the Government refers to can afford to provide employee benefits such as paid parental leave. Expecting small businesses to measure up inflicts crippling costs which ultimately risk job losses. Statutory requirements have to be of a pace that can be absorbed at every level and that will require the Government to provide financial assistance to the UK's 1.14million small businesses. If not, equalities are going to be most obvious between the rights of employees of large firms and those of SMEs.

Burdens on business cannot be intolerable. There must be recognition in the law that businesses be allowed to manage their businesses effectively and treat all of their employees fairly and equally, with the same tests of performance being applied across all employees.

The most important area to stamp out discrimination is in the workplace. But prejudice does not last from 9am on Monday to 5pm on Friday. It is an unfortunate aspect of the Government's action on equality that it appears content to leave progress to the realm of employment. Equality legislation should go further than merely enabling people to get their complaint heard at an employment tribunal.

Women will still face a heavier burden of proof in discrimination cases that do not relate to their jobs. An older person who is denied services by the local council on the grounds of age will be denied legal redress. Public authorities and large employers do not have any obligation to equality of opportunity except in race relations.

Progress in employment legislation has to be matched by similar initiatives in education, housing and the provision of goods and services.