Multi-million pound discrimination case offers a stark warning to employers
A recent employment tribunal case, in which a female banker was awarded £3.2m for office ‘banter’ that crossed from bullying into sex discrimination, shows how substantial costs and serious reputational damage can stem from failing to take sexual harassment and gender-based discrimination at work seriously.
Cambridge graduate Svetlana Lokhova was paid in excess of £750,000 a year by Sberbank CIB and generated over £20m in profits for the Russian bank. The employment tribunal found she had been driven to a mental breakdown by the treatment from her male colleagues, which caused her to resign in April 2012. These colleagues had called her “crazy Miss Cokehead” and “bonkers” among other names, and her manager was found to have said that she had “unfortunate natural brain chemistry” and was only hired “because of her t***”.
Tribunal
Although the tribunal only upheld three out of Lokhova’s 22 complaints, it ruled that enough of the comments made against her had a gender element in them to tip them from bullying (for which there is little legal remedy in practice) into sex discrimination in breach of the Equality Act 2010 (for which there is no ceiling to damages).
The tribunal acknowledged that she would never work in financial services again so awarded substantial damages of £3.14m for lost earnings, £44,000 for injury to feelings and £15,000 for aggravated damages for the way the bank deliberately misused the tribunal proceedings by accusing her of taking drugs in order to slur her character.
The tribunal also expressed disappointment that her manager, despite being the principal perpetrator, was not sacked for gross misconduct (although he subsequently left) and the CEO, who was found guilty of unlawful victimisation for failing to investigate her complaints, had no disciplinary action taken against him.
Following the decision, the bank said it was committed to taking on board any lessons to be learned. What should those lessons be? While some may feel that office ‘banter’ – jibes and witticisms between employees - creates a fun, light-hearted atmosphere, perceptions of what is acceptable can differ greatly. Organisations can show they have taken all “reasonably practicable” steps to prevent banter entering the realms of discrimination or sexual harassment by:
Having the right policies– ‘Equal opportunities’ and ‘Bullying and harassment’ policies should express zero tolerance of inappropriate behaviour, and ideally should provide clear examples of what is inappropriate, including nicknames, crude remarks, sarcastic comments and laughing or whispering about someone else.
There should be a clear process for those who feel they are being subjected to improper treatment, along with a list of disciplinary penalties for perpetrators.
Proactive training – these policies should not be hidden in a lengthy handbook that can only be found “somewhere on the intranet”. They should be brought to life through mandatory training for everyone from the ‘shop floor’ all the way up to board level.
The training should be interactive and allow for questions on what types of banter are acceptable. Employees should sign a form confirming their attendance. The policies should also be circulated among the workforce intermittently (for example, before seasonal parties, following a complaint, or prompted by a high-profile case such as this).
Culture– employers should build trust and transparency by having an open door policy and offering employee counselling services or helplines. They should investigate all complaints, whether formal or not, and keep a paper trail of those investigations. They should take proper disciplinary action (often dismissal for gross misconduct) against those found guilty of the allegations, as this sends a powerful message to the workforce. They should intervene early and reiterate boundaries when overhearing inappropriate remarks or seeing potentially offensive material such as topless calendars or sexist screen savers at work.
Comments from those reading about this case highlight how pervasive this type of office ‘banter’ appears to be; some suggest Lokhova should have been more thick-skinned if she wants to work in the City; others showed disapproval at the sums awarded for ‘just’ being called bonkers and a cokehead when so much worse goes on there. This claimant was brave enough to stand up against such a culture. Most victims are not and continue to suffer in silence. Businesses need to take the lead by stamping out the problem.
Anita Rai is an employment law partner at law firm Taylor Vinters
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