British businesses face a greater risk of legal action if they follow their US counterparts in ditching efforts to improve diversity and inclusion in the wake of Donald Trump’s return to office, the UK’s leading authority on employment law has warned.
The Employment Lawyers Association (ELA), which has 7,000 members, has said British companies could open themselves up to “adverse findings of discrimination” if they unpick policies designed to enable diversity equity and inclusion (DEI).
In an open letter to businesses, Caspar Glyn KC, the chair of the ELA, said that defending a company against discriminatory acts made by an employee was already difficult but “would be hopeless” without DEI policies in place.
Glyn also said employers without DEI policies would be unlikely to be able to demonstrate that they had taken “all reasonable steps” to prevent sexual harassment, for example, which they are legally required to do. The employment rights bill, due to be approved by parliament, will strengthen that requirement.
Trump has prompted a rollback of DEI programmes in the US, after he signed a series of executive orders overturning such measures.
Several large US corporations, including Walmart, McDonald’s, Ford and Amazon, have either scrapped or are scaling back their DEI schemes.
Fears have grown that UK companies could follow suit. The Bank of England’s regulatory arm, the Prudential Regulation Authority, and the Financial Conduct Authority have said they would not bring in new diversity and inclusion rules for financial companies. Instead, they are supporting “voluntary industry initiatives” aimed at increasing diversity and inclusion in the financial sector.
However, Glyn warned businesses: “If you operate in Great Britain and roll back your DEI policies for workers here in response to the US administration’s recent approach towards DEI policies, you will increase the risk of adverse findings of discrimination against your business.”
UK law differs from US law in that it mandates equality but “positive action” has never permitted using race or other protected characteristics, such as gender, sex or religion, as a selection criterion to favour particular workers in applying for jobs or promotions, with an exception as a tie-breaker when candidates are equal.
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In the UK it would be unlawful to hire someone simply because they are a woman, for example. However, if women are underrepresented in a company, then it can take steps to promote vacancies to that group or to provide extra support for them to apply.
“A company rolling back its DEI policies in the UK, in response to the chilling of such practices in the US, would be legally incoherent and increase the risk of adverse findings of discrimination against it,” Glyn said.
