Indirect Discrimination in the Workplace and How It Arises

Indirect discrimination in employment law occurs when an apparently neutral work rule, policy, criterion or practice has a disproportionate negative effect on people who share a protected characteristic as defined under the Equality Act 2010. It contrasts with direct discrimination, where less favourable treatment is intentional or obvious. Indirect discrimination may be less visible but is unlawful unless an employer can show the practice is a proportionate means of achieving a legitimate aim. This article explains how indirect discrimination arises, what it means in practice, the legal requirements to make a claim, time limits, and practical guidance for employees and employers in England and Wales.

Legal Definition of Indirect Discrimination

Under the Equality Act 2010, indirect discrimination arises when an employer applies a provision, criterion or practice (PCP) - a rule, policy, requirement, criterion or way of working - that:

1. Is applied equally to all employees or job applicants;
2. Disadvantages people who share a protected characteristic when compared with others;
3. Disadvantages the claimant personally, and
4. Cannot be objectively justified as a proportionate means of achieving a legitimate aim.

A protected characteristic includes age, disability, gender reassignment, race, religion or belief, sex and sexual orientation, among others. Indirect discrimination does not explicitly apply to pregnancy and maternity, but pregnancy‑related disadvantage may often amount to indirect sex discrimination.

The PCP must affect a group sharing a protected characteristic rather than an isolated individual in order to constitute indirect discrimination.

How Indirect Discrimination Arises in the Workplace

Indirect discrimination can arise from formal policies or informal working practices that apply to everyone but place particular groups at an unfair disadvantage. These provisions need not be written; they may include customary ways of operating or unwritten expectations. Examples of common PCPs include:

• Recruitment and selection criteria, such as minimum years' service that disproportionately exclude younger workers;
• Working hours or attendance requirements, such as mandatory unsocial hours that disproportionately disadvantage carers or people with disabilities;
• Dress codes or uniform policies that indirectly disadvantage employees with particular religious beliefs;
• Redundancy selection procedures that unintentionally disadvantage older or disabled employees;
• Performance appraisal practices that disadvantage part‑time workers.

An example highlighted by Acas is where a job is only advertised internally and all existing employees who could apply happen to be of one sex - this could indirectly discriminate on the ground of sex even without discriminatory intent.

Objective Justification: When Indirect Discrimination May Be Lawful

Indirect discrimination is not automatically unlawful. An employer may defend a PCP by proving it is a proportionate means of achieving a legitimate aim. The employer must:

• Identify a legitimate aim, such as operational needs, health and safety or business requirements; and
• Demonstrate that the PCP is appropriate and necessary to achieve that aim, with no less discriminatory alternative.

Financial reasons alone are unlikely to justify indirect discrimination. The more significant the disadvantage caused, the stronger the employer's justification must be.

A hypothetical example of justification is retaining an employee with specific language skills essential for a contract; if training others would take too long and harm the business, the practice might be justified if proportionate.

Protected Characteristics and Scope

Indirect discrimination applies to most protected characteristics under the Equality Act 2010:

• Age
• Disability
• Gender reassignment
• Race
• Religion or belief
• Sex
• Sexual orientation
• Marriage and civil partnership (in some contexts)

However, indirect discrimination provisions do not expressly apply to pregnancy and maternity in the Act. Disadvantages linked to pregnancy are instead generally treated as indirect sex discrimination because pregnancy is associated with the protected characteristic of sex.

Recent statutory amendments extend the scope of indirect discrimination claims by allowing someone without the protected characteristic to claim if they suffer substantially the same disadvantage as those with the characteristic. This reflects changes introduced in statutory amendments during 2023.

Examples of Indirect Discrimination at Work

Indirect discrimination may not be obvious and often arises from well‑intended policies. Typical examples include:

• Uniform requirements banning head coverings, disproportionately affecting employees whose religious beliefs include wearing specific attire.
• Mandatory full‑time working rules that disadvantage women with caring responsibilities more than men, unless objectively justified.
• Strict break times that disadvantage employees with certain disabilities who need additional rest or medication breaks.
• Remote work or travel expectations that may disadvantage certain age groups or people with mobility issues.

These examples show that the impact, not the intent, determines indirect discrimination. Even a neutral rule may breach the law if it disproportionately disadvantages a group of people with a protected characteristic.

Making a Claim for Indirect Discrimination

Employment Tribunal Process

Employees who believe they have suffered indirect discrimination at work may pursue a claim in an employment tribunal. Before issuing a claim, most individuals must notify Acas and participate in Early Conciliation to explore settlement and narrow issues for litigation. Failure to do so can prevent the tribunal from hearing the claim.

Time Limits

A claim must generally be presented to the tribunal within three months minus one day from the date of the last discriminatory act or from the date when the disadvantage became apparent. Strict compliance with time limits is essential; tribunals have limited discretion to extend them only in exceptional circumstances.

Burden of Proof

To succeed in an indirect discrimination claim, a claimant must show the PCP disadvantages people with a protected characteristic and personally disadvantages them in the same way. Once these elements are established, the burden shifts to the employer to justify the PCP as a proportionate means to a legitimate aim.

Remedies and Compensation

If an employment tribunal finds unlawful indirect discrimination, remedies can include:

• Compensation for injury to feelings, reflecting the emotional impact of discrimination;
• Compensation for financial loss, such as lost earnings or benefits;
• Recommendations to employers to revise discriminatory policies or practices.

Compensation depends on the severity of the disadvantage and the specific facts of the case.

Practical Steps for Employers and Employees

For Employers

1. Audit policies and practices to identify potential indirect discrimination risks;
2. Conduct equality impact assessments when new rules are introduced;
3. Train managers on discrimination law and unconscious bias;
4. Consider reasonable alternatives or accommodations where necessary;
5. Respond promptly to concerns and investigate complaints fairly.

For Employees

1. Document the PCP and how it affects you;
2. Compare the impact on others without the protected characteristic;
3. Raise issues internally using grievance procedures;
4. Engage with Early Conciliation through Acas before tribunal claims;
5. Seek advice from Citizens Advice, trade unions or employment law specialists.

Summary

Indirect discrimination arises when a workplace rule, policy or practice applied equally to all disproportionately disadvantages people who share a protected characteristic under the Equality Act 2010. It is less about employer intent and more about impact. Employers can defend such claims only by proving the practice is a proportionate means of achieving a legitimate aim. Employees who experience indirect discrimination can raise internal concerns and may pursue tribunal claims after engaging in Early Conciliation, subject to strict time limits. Understanding how indirect discrimination arises helps both employees and employers identify risks, resolve issues and promote an inclusive workplace.

James William Steven Parker

James is the founder of UKLegalGuides.com and a former agent at the Ministry of Justice (UK). With a background in processing legal claims, he launched this platform to make the laws of England and Wales accessible to everyone.