Mcdonald’s handling of sexual harassment complaints from staff in UK restaurants has attracted much attention. The UK CEO, Alistair Macrow, confirmed to the Business and Trade Committee in November that the company is still receiving, on average, two sexual harassment complaints per week.
We discussed why tackling discrimination and harassment should be a priority for employers in our recent HRLaw webinar, which you can watch here. Employers will shudder at the reputational damage and the prospect of expensive employee legal claims, but the potential for enforcement action by the Equality and Human Rights Commission (EHRC) is often overlooked.
In McDonald’s case, the EHRC launched an initial investigation in the UK following a trade union highlighting over 1000 reports of staff sexual harassment. This culminated in a legally binding agreement with the company – known as a “section 23 Agreement”, earlier this year, committing McDonald’s to specific steps to address the issue.
In this article, we analyse the role of the EHRC, the details of the section 23 agreement reached with McDonalds, and the extent of the EHRC’s enforcement powers.
What is the role of the EHRC?
Essentially, the EHRC is the regulator for the Equality Act 2010 (the “Act”), ensuring that the rights and obligations contained within it are adhered to. The Act specifies that the EHRC must:
Promote understanding of the importance of equality and diversity.
Encourage good practice in relation to equality and diversity.
Enforce the Act and promote awareness and understanding of rights under it.
Promote equality of opportunity.
Work towards the elimination of unlawful discrimination and harassment.
As part of its remit to focus on equality in a changing workplace, the EHRC can respond to alleged failures by employers to protect employees from discrimination and harassment at work. Under section 23 of the Act, the EHRC has the power to enter into legally binding agreements with employers to avoid further breaches of the Act in exchange for the EHRC agreeing not to take enforcement action. Previously, agreements have been concluded with various companies, including Sainsbury’s, Ikea, and Jaguar Land Rover.
What does the McDonald’s section 23 agreement cover?
The EHRC agreement with Mcdonald’s contains various commitments towards protecting its workforce from sexual harassment. These include to:
communicate a zero-tolerance approach to sexual harassment;
conduct an anonymous survey of workers about workplace safety;
enhance policies to prevent sexual harassment and improve its responses to complaints;
deliver anti-harassment training for employees;
introduce specific training to help managers identify areas of risk within their restaurants and take steps to prevent sexual harassment;
support the uptake of policy and training materials by franchisees within their independent organisations to support reporting of sexual harassment; and
monitor progress towards a safe, respectful and inclusive working environment.
It is worth noting that the EHRC retains the ability to vary or terminate a section 23 agreement. To the extent that there is evidence of non-compliance, legal action to enforce the commitments can follow.
What enforcement powers does the EHRC hold?
The EHRC has various enforcement powers detailed in the Act, which include the ability to:
Conduct investigations when it suspects unlawful behaviour (for example, where reports have been made by alleged victims or an associated trade union).
Issue anunlawful act notice requiring an employer to prepare an action plan and recommend certain actions that should be taken.
Enter asection 23 agreement, such as the one described above, in relation to McDonald’s.
Apply for an injunction to stop the commission of an unlawful act.
Assist, institute, or intervene in legal proceedings in relation to the Act.
While breaches by larger employers and incidents involving numerous complaints are more likely to gain the EHRC’s attention, there is nothing to prevent an individual employee alerting the EHRC to their employer’s mishandling of a sexual harassment complaint, for example. The section 23 agreement with Ikea followed a complaint from one employee, reinforcing the need for all employers (regardless of size) to be aware of the prospect of EHRC intervention.
Incidents of discrimination and harassment in the workplace must be dealt with appropriately by employers, particularly given the new duty on employers to take reasonable steps to prevent sexual harassment. The new duty is expected to take effect in October 2024 pursuant to the Worker Protection (Amendment of Equality Act 2010) Act.
The EHRC will also publish a new statutory Code of Practice to assist employers with understanding the reasonable steps that are expected, which will build on the existing guidance for employers on preventing sexual harassment at work. A breach of the new duty can potentially lead to EHRC enforcement action, as well as the employment tribunal uplifting compensation by up to 25% in a successful sexual harassment claim.
Clearly, the intention is that the EHRC will play a much more active and visible role in turning the tide against sexual harassment in the workplace moving forward.
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