Compensation 


There is no upper limit for compensation in discrimination claims, and compensation can be claimed under a number of different headings. 


Although compensation is unlimited, typical awards are not high. For example, the median award for a claim for sexual orientation discrimination in 2014-15 was £6,000. 


Claims can be brought against the individual employee who carried out the discrimination as well as their employer. 


A claimant can choose who to enforce an award against. Usually this will be the party with the most assets. This is typically the employer, but in cases of insolvency the claimant may opt to enforce the whole claim against an individual harasser if they have assets such as a house. The tribunal has no power to apportion (share) an award among co-discriminators. They are all equally liable for the whole amount (London Borough of Hackney v Sivanandan [2013] EWCA Civ 22).


If a claimant left a job due to discrimination, compensation for loss of earnings will include actual financial loss, plus an estimate of future loss. This is assessed using a “rough and ready” approach, taking the salary they would have earned had they remained at work, net of tax and national insurance, and discounting it by a percentage to reflect future contingencies such as the likelihood of changing jobs or losing their job at a later date, for example, through redundancy. 


Compensation is normally awarded up to the point at which it is “at least possible” that someone is likely to find another job (Wardle v Credit Agricole Corporate and Investment Bank [2011] EWCA Civ 545). The fact that an employer “unintentionally” discriminated is not a defence.


Especially where a claimant had a final salary pension, pension losses are often the largest element of any award. Where there is good evidence that without the discrimination, a claimant would have stayed in their job until retirement, pension losses can be awarded up until retirement age (Griffin v Plymouth Hospital NHS Trust [2014] EWCA Civ 1240).


Claimants can claim damages for injury to feelings. The size of this award can reflect many factors, including the length of time the employer took to resolve the employee’s grievance (BT v Reid [2004] IRLR 327), the seniority of the discriminator and the persistence and seriousness of the discrimination.


There are three compensation bands for injury to feelings awards (Vento v Chief Constable of West Yorkshire Police [2003] IRLR 102, Da’Bell v NSPCC UKEAT/0227/09): 


• Top band: £19,800 — £33,000, for the most serious cases, for example, a lengthy campaign of discriminatory harassment; 


• Middle band: £6,600 — £19,800, for serious cases which do not merit an award in the highest band; 


• Lower band: £660 — £6,600, for less serious cases, for example, where the act of discrimination is an isolated or one-off occurrence. 


The bands are not rigid rules and allow for flexibility. Their purpose is to promote consistency and fairness as between different regional tribunals. 


Awards above or below these limits should only be made in exceptional circumstances.


Tribunals are expected to assess compensation for non-financial losses in “today’s money” (Bullimore v Pothecary Witham Weld (no.2) [2011] IRLR 18), in other words, taking inflation into account.


In Essa v Laing [2004] IRLR 313, the Court of Appeal held that an employer must still pay compensation for injury to feelings even though it could not have been foreseen that the discrimination would affect the employee’s health so badly. 


For compensation for injury to feelings, the claimant need not have realised that the mistreatment was due to discrimination, although clearly, claimants who realise they have been discriminated against are likely to feel even worse (Taylor v XLN Telecom Ltd [2009] UKEAT 0385/09/0911).


Tribunals can also award aggravated damages where employers or their employees behave in an exceptionally upsetting, spiteful, vindictive or unthinking way. Actions following the initial discrimination, such as a failure to apologise, can also lead to this type of award. Aggravated damages, although intended to reflect exceptionally upsetting behaviour, are nevertheless intended to compensate the victim, not punish the offender (Commissioner of Police of the Metropolis v Shaw [2011] UKEAT 0125/1/2911, Bungay v Saini and others [2011] UKEAT 0331/10/2709).


Tribunals can also award additional compensation for psychiatric injury. In MoD v Cannock [1994] IRLR 509, the EAT held that compensation could be claimed for hurt caused by loss of a chosen career. 


Very exceptionally, tribunals also award exemplary (punitive) damages — for example, where a public authority has behaved in an oppressive, arbitrary or unconstitutional way.


In determining compensation in harassment cases, tribunals will take account of the impact of harassment and how the employer responded to it. They can also take account of factors such as the victim’s age (for example, if the claimant was a young person, or was particularly vulnerable), whether the employer’s attitudes encouraged the harassment and whether complaints were ignored. 


An employer’s ability to pay is never a relevant factor when deciding how much compensation to award (Tao Herbs and Acupuncture Limited v Yin [2010] UKEAT 1477/09/1407).