Equality Bill

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Q 192Jim Sheridan: So you discriminate against people with mesothelioma.
Nick Starling: If you have mesothelioma, clearly it is a very serious cancer and there would be circumstances in which it would be difficult to get particular sorts of insurance, because they are health related and you would not be able to get them.
Q 193Mr. Harper: May I come in briefly on this, because it illustrates whether we are correct in using the word “discrimination”? On Mr. Sheridan’s point, if you have a terminal illness and you know that you have it, clearly you are not going to be able to take out a life insurance policy. That is straightforward and, particularly in relation to age and other types of discrimination, it goes to the heart of what discrimination means. Clearly, an insurer has to have a range of facts at their disposal to price the risk appropriately, and the extent to which you can price the risk appropriately is an issue raised by the Bill. If you cannot price the risk appropriately, will that mean that insurance is available to people? Will insurers then cease to write that business at all? Will you expand on the ability to price risk and particularly on the extension, which is around age?
Nick Starling: In insurance, some risks are extremely difficult to price. As you say, if you have a terminal illness that might be one such risk in terms of life or health insurance when travelling abroad. Having said that, there are specialist providers that cover such risks or provide insurance that manages them. If you did not have that ability to manage risks, in some circumstances insurance would be almost impossible to buy across the piece.
In effect, if you have a disability, such as being wheelchair-bound, the risk is that the insurer’s price will be associated only with things such as special modifications to a vehicle and will not otherwise affect the way in which insurance is provided.
The Chairman: Evan Harris wants to come in on the subject of positive action.
Q 194Dr. Harris: I just want to ask members of the panel who have a view on the new provisions what their views are. If you have a strong view, now is your chance. I am happy to start with Stephen if he has a view on the provisions whereby positive action is allowed in making employment decisions between “equally qualified candidates”.
Stephen Alambritis: We do not have a strong view. We are relaxed and content with the intentions of the Bill on this. The chances of a small employer having in front of them two equally qualified candidates who are both suitably qualified are minuscule, whereas the consultants or recruiters used by a large firm would normally present it with two excellent candidates and leave it up to the employer to make the final decision.
You would have to be sophisticated to use this technique successfully so that there is no backlash. There is a great deal of confusion about what positive action is. People only want to be appointed because they have merit in the first place. That has to stack up, but we need it in the kitbag.
Sarah Veale: I agree with that. I do not think that regulation is the right way to take positive action further. What the Government have done is very welcome, but other organisations such as the Chartered Institute of Personnel and Development and the Equality and Human Rights Commission have a big job to do in explaining what positive action means so that what Dianah has described can be put in place. It is much more complicated than looking simply at recruitment decisions. It goes far further than that. Much more guidance and help is needed.
Katja Hall: I agree with you on this issue. We would like to see many more employers use positive action to improve diversity in their work forces. We have some concern about how the clause is drafted. It could lead to legal uncertainty, which would make employers reluctant to use it. We would like to see tighter drafting of the clause.
Q 195Mr. Harper: I want to pick up on one point that Dianah made. Dr. Harris’s question was specifically about clause 153, which is about recruitment and promotion decisions. My reading is that the explanatory note applies only to people who are equally qualified, whereas the language in the Bill—which we will probe in Committee—talks about people who are “as qualified”. That does not seem to be the same thing. The measure does not allow you to have a policy of discriminating in favour of particular people. It must be done on a case-by-case basis. I agree with the broad consensus that it will not be possible to use it very often. The chances of there being two equally qualified candidates are pretty slim. There must also be evidence that they are equally qualified. Given that—one or two of you have already picked this up—is this really the right way? If you look at clause 152, you will see that it focuses much more on the positive steps that employers can take to reach out into different groups that they perhaps do not recruit from. Is that a more productive way of approaching this matter than clause 153?
Dianah Worman: You need many different tools in the kitbag to make progress; you cannot depend on one. The discussion has gone back to good people-management practices. If you get your act together on that, you are less likely to have to introduce these techniques, but we need them all to make progress.
Katja Hall: A lot of the focus should be on the pre-recruitment stage in terms not only of encouraging people to apply to work in a particular company, but of tailoring training to ensure that particular groups progress within the workplace. That is correct.
In terms of the drafting of the clause itself, we need to be clear what it refers to, but I am not sure that we are at the moment. We have some concerns. The explanatory notes and the clause are different, but we are also not entirely clear as to what “as qualified as” means in this context. Some of our legal members have been saying that it could be taken to mean just qualifications. We would like to see a much broader definition including experience and a reference along the lines of “‘as qualified as’ in the reasonable judgment of the employer”. Only with those caveats will we give employers the confidence to use the power. Otherwise, it will be a missed opportunity.
The Chairman: We have less than 14 minutes to go. I am going to call Vera Baird and then John Penrose.
Q 196The Solicitor-General: On the same point about positive action, my understanding from conversations with some business organisations is that this kind of step is being taken now. For instance, if somebody wants to market something to a black and minority ethnic group, and if two sales people apply for the job, one of whom comes from the group, they would want to favour the person who comes from the group, given that they would be under-represented in the community of employees and that it would be appropriate and helpful for the marketing prospects of the business. If that happens now—it would be surprising if it did not and the evidence that we have garnered is that it does—the danger is that it would be discriminatory at the moment. Protection will come from this clause in this Bill.
Katja Hall: Basically, employers want certainty and clear parameters. That requires some redrafting of the Bill. We have not had a lot of feedback saying that employers are using it at the recruitment stage at the moment—obviously, there are different rules relating to disability. Employers want clarity above all and good practical guidance. We urge the EHRC to make that one of its top priorities and to give employers the confidence to use it.
Q 197The Solicitor-General: Forgive me for pressing, but I do not believe that you have answered my question. Leave disability out of it; it is not what I meant. I referred to race. It would be discriminatory to do what I have suggested happens at the moment in business, whether you have any experience of it or not. Will this clause give some protection to managers who wish to take steps of that kind?
Katja Hall: Yes. That is why we support the clause.
Stephen Alambritis: Yes, we agree as well. Employers have an eye to marketing and sales, and to getting the best possible deal and symmetry between their staff and customers, so actions would be taken, as they are today, that are positive about whom to employ. The positive action clause would help in that regard.
When debating amendments, we would put into the pot the use of the word “suitable” as well as “qualified”. A small firm would look at the suitability of the potential employee as well as at the strap line of whether they are “qualified”.
The Solicitor-General: Thank you very much to both witnesses.
Sarah Veale: We completely agree with that. Guidance is essential and positive action is a very good thing. We support the clause.
The Chairman: We have just more than 10 minutes to go. Do colleagues have further questions? If so, does someone want to indicate an interest?
Q 198Sandra Osborne: Can I ask you about the public procurement provision in the Bill? Do you welcome it, and how do you think that it will be implemented? What would be the best way of implementing and monitoring it?
Katja Hall: We welcome the provision in the Bill. It is not particularly detailed, so we look forward to seeing the consultation document and the follow-up to that. We believe that procurement can be an effective lever, and our members support the general principle behind the clause. For the clause to be effective, we suggest that it needs to be focused on outcomes and not on processes or ticking boxes. It also needs to be relevant to the contract and to be sufficiently flexible to enable you to focus on different issues in different areas. So, for example, if you are delivering welfare-to-work services in Bradford, race may be a relevant factor. However, if you are contracting for stationery in Devon, race would probably not be a relevant factor. So the clause needs to be sufficiently flexible.
The only other point that I would make about procurement is that our members get quite frustrated about the inconsistency in approach. We would like to see much better guidance given to local authorities and public service organisations about what questions they should ask, what they should be looking out for and about how the bids are assessed. Certainly, the feedback that we have received is that there is a lot of inconsistency at the moment and employers do not quite know where they stand.
Stephen Alambritis: The key point in ensuring that the procurement process is good for everyone, including large and small firms, is simplification of the process. What we would seek, as we talk through the clause, is to use the principles of the Glover review, which looked at public procurement and sales, to see whether or not the clause can take advantage of that simplification of procurement processes. So, in dealing with the procurement aspects of the Equality Bill, we would be content if the Glover review recommendations were thought of as the Bill is being considered.
Q 199The Solicitor-General: May I pick up on Katja’s example? I am sorry; I am not deliberately directing all my questions at the CBI.
Katja, you talked about the difference between delivering welfare-to-work in a place where there is a large BME population, where you would have thought that procurement to assist equality and diversity is appropriate. By contrast, regarding the delivery of pencils in Devon, the suggestion is that it would not be thought appropriate. However, you would not want public authorities to procure stationery from a stationery manufacturer in Devon that had repeatedly broken equality law and that had been brought to the tribunal for being racist, sexist or for discriminating against disability, would you? So, in that situation it would be relevant as to whether or not that company was included in the pool, would it not?
The Chairman: Before the answer is given, I just want to say that I would like all four colleagues to get in and ask questions. Therefore, really pithy answers would be appreciated.
Katja Hall: If that company had been found repeatedly to have been discriminating, I think that it would be relevant. However, I think that we need to be careful not to penalise companies for a one-off mistake.
Q 200The Solicitor-General: It would have to be proportionate, would it not, to exclude them? However, that possibility of exclusion ought to be available.
Katja Hall: We would need to look at the detailed drafting. If the company were a repeat offender, then it might be relevant.
Q 201The Solicitor-General: “Relevant”? It would be a good reason to exclude that company. As a public authority, with your equality duty, you would not buy public services from somebody who paid black people less than white people, would you?
Sarah Veale: That is the key thing. The provision needs to be linked to the public sector duty; it is not there on its own. What the Government have done is extremely helpful in explaining how this could work.
Q 202John Penrose: I want to pick up that precise point, and I particularly want to ask Stephen and Katja a question. If we are going to talk about “outcomes-focused duties”, which I think both of you have mentioned, the example that Vera just gave is quite important, because you would be most interested in obtaining the best value for money from your pencil supplier regardless of what that supplier had done, providing that it was operating within the law. If it had not operated within the law, it would have fallen foul of the law in some way.
I am interested in whether, if you believe in outcomes-based procurement, that alters the answer you gave the Minister just now.
Stephen Alambritis: I do not think that we should seek to reward bad employers through the procurement process. The award of a public sector contract is a huge plus and a huge bonus to firms, large and small. We believe that the award of public procurement contracts should be based on commercial grounds, but that the reputational aspect of the business should be taken into account by buyers and purchasers. We need to be mindful, as Katja has said, of the one-off offender, and I agree with Vera with regard to proportion. If a firm is continually known to be defying employment legislation, they are a bad employer and should not be rewarded with a public procurement contract.
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