Employer successfully uses ‘All Reasonable Steps’ defence in racial harassment case

Employers can be liable for harassment committed by employees “in the course of employment” under the Equality Act 2010. This may feel unfair, as employers can’t control everything staff say or do. But there’s a key defence: if the employer can show it took all reasonable steps to prevent the harassment from occurring, it may avoid liability.

This defence is rarely successful because it’s a high bar – employers must prove they did everything reasonably possible before the harassment occurred. 

Tribunals use a two-part test (from Canniffe v East Riding of Yorkshire Council):

1. What steps did the employer take?
2. Were there other reasonable steps they could have taken? If yes, the defence fails.

Case spotlight: Campbell v Sheffield Teaching Hospitals NHS Foundation Trust & Hammond

This case is a rare success for the defence. During a dispute, a trade union member (Mr Hammond) made a racially abusive comment to Mr Campbell, a union Branch Secretary and Trust employee. While the tribunal found the comment was made, it ruled that the Trust was not liable – and the Employment Appeal Tribunal agreed.

The Trust had taken several proactive steps:

• Dignity at work training at induction, introducing core values
• Annual performance reviews that considered equality and diversity
• Clear workplace messaging via posters
• Regular mandatory equality training, which Mr Hammond had recently completed

No other reasonable steps were identified during the case, so the defence succeeded.

A note on sexual harassment

For sexual harassment, the law now goes further. Section 40A of the Equality Act introduces a proactive duty to take reasonable steps to prevent it. If employers fail, tribunals can increase compensation by up to 25%. While the wording differs slightly, upcoming changes in the Employment Rights Bill are expected to align the two tests.

What HR should do

To strengthen your position:

• Conduct regular harassment risk assessments
• Keep anti-harassment and equality policies current
• Deliver meaningful training to staff and managers
• Ensure policies are actively followed

The Campbell case shows that well-embedded anti-harassment measures can pay off.