UK: Last Orders - Pub That Wanted To Be Less Gay

The Employment Appeal Tribunal ruled that Realpubs Limited went too far in trying to re-position London's first gay pub as a gastropub catering for a wider clientele. The commercial policy was legitimate but was implemented in a way that treated gay customers less favourably on the ground of their sexual orientation. An openly gay employee, who chose to resign rather than help to carry out the policy, was therefore entitled to claim that he had been discriminated against on the ground of sexual orientation.

Facts

Realpubs' business model is to buy failing pubs and turn them into gastropubs. Realpubs acquired the Coleherne in Earls Court, which was known as London's first gay pub and which was in decline. They wanted to broaden the pub's image and widen its clientele. In implementing this policy, amongst other things they told the pub's Manager to display a board saying "This is not a gay pub" and encouraged staff to seat customers who did not appear to be gay in prominent places. Realpubs also set out to redress the gender balance of the pub's non-managerial staff, which was 100% male. Within 1 month, 5 male employees had left and 50% of the pub's non-managerial staff was female. A director of Realpubs was also found to have made a number of homophobic remarks. The Claimant resigned, telling Realpubs that he would have nothing to do with the kind of business that Realpubs was seeking to build.

Decision

Previous cases had established that instructing an employee to implement a policy that was itself discriminatory (for, example, because it was overtly racist towards customers) amounted to unlawful discrimination against that employee, even if he or she was not of the same race as the customers who were discriminated against. Thus an employee of a car rental business who was told to tell "any coloureds or Asians" that there were no vehicles available was entitled to resign and claim constructive dismissal on the ground of race discrimination.

In the Realpubs case, the Employment Appeal Tribunal (EAT) found that the policy of widening the pub's clientele was itself legitimate. However, the EAT said that the question was whether, looking at the overall picture, gay customers might reasonably feel that, as a result of the measures taken in carrying out the policy, they were disadvantaged compared with non-gay customers. The EAT found that it was plainly the case that gay customers were treated less favourably on the ground of their sexual orientation. Consequently, the employee who had been asked to help in taking those measures had also been treated less favourably on the ground of sexual orientation.

Lesson for Employers

Employers need to think very carefully about the implementation of a business strategy based on an assessment that their customer-base is too narrow in some way, e.g., "too old" or "too young". Broadening the customer-base may well be a perfectly legitimate commercial objective.

However, if the policy is implemented in a way that treats people with a protected characteristic less favourably than others, any employee who is asked to carry out the policy in that way may be entitled to claim that he or she is the victim of unlawful discrimination. This is so even if he or she does not share that characteristic - the result in the Realpubs case would have been the same even if the employee who resigned had not been gay.

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