Lisboa v. Realpubs Ltd & Ors  UKEAT 0224_10_1101 (11 January 2011) – Read judgment
The Employment Appeals Tribunal (EAT) has ruled that a well-known gay pub’s strategy to encourage straight customers led to gay customers being treated less favourably, meaning that the a gay employee was forced to resign.
The policies included seating straight customers at the front of the pub where they would be most visible to passers by. The Claimant was an employee of the well-known London pub the Coleherne. The Coleherne was thought to be the city’s first ‘gay pub’ and had been operating as such for the past forty years, but in September 2008 reopened as a gastro-pub, The Pembroke.
The EAT allowed the Claimant’s appeal from a claim for constructive wrongful dismissal and unlawful sexual orientation discrimination.
In 2008 the pub was in decline and was bought by Realpubs who, known for turning failing pubs into ‘gastro’ pubs, sought to re-launch the pub to appeal to a wider audience.
In November 2008, shortly after Realpubs acquired the Coleherne, the Claimant, an openly gay man, accepted the position of Assistant Manager. He resigned in January 200 and thereafter made a claim for constructive dismissal.
The policy of Realpubs at the time of the Claimant’s employment was to encourage staff to seat customers or groups of customers who did not appear to be gay in prominent places in such a way that they could be seen from outside the pub.
The claim brought by the Claimant was for constructive wrongful dismissal based on two categories of unlawful direct discrimination.
- Comments made by the respondents directed towards the claimant on the grounds of his sexual orientation.
- That the respondents pursued a course of conduct whereby the claimant was put under pressure to work in and cooperate with a policy of making the pub less welcoming to gay customers.
The Decision at First Instance
The Employment Tribunal found that the comments made by the respondents towards the Claimant were offensive and that the Claimant had suffered detriment and that the comments were made on the grounds of his sexual orientation.
The tribunal rejected, however, the contention that Realpubs’ had instigated a policy of discrimination on the grounds of sexual orientation and that this was unlawful by virtue of regulations 3 & 4 of the Equality Act (Sexual Orientation) Regulations 2007. It was found that:
…nothing was done to make the pub unwelcoming to gay customers or less welcoming to gay customers than other patrons. Nor was any instruction given to that effect…The last thing in the minds of its directors was to alienate their established customers…. a reduction in the percentage of gay customers would not have amounted to an exclusion of gay people or less favourable treatment of them, even if some established customers might have disapproved. Rather it would have been the natural fulfilment of the unobjectionable ‘re-positioning’ strategy.
The Employment Appeal Tribunal
Counsel for the Claimant argued that the ET applied a wrong approach. Instead of looking at the overall effect of the Respondents’ implementation of their re-positioning policy on the customers and as a result on the Claimant, as a gay employee, the ET limited themselves to the commercial aim of Realpubs. The correct question for the ET, he argued, should have been to ask whether gay customers would or might reasonably take the view that, as a result of the measures adopted, they were disadvantaged compared with straight customers.
The case on appeal therefore focused on whether or not Realpubs, in their pursuit of widening the appeal of the pub implemented this policy in such a way that gay customers were treated less favourably than straight customers on the grounds of sexual orientation.
The EAT held, however, that the policy of Realpubs to rebrand the Pembroke was not unambiguously discriminatory as had been the case in Wethersfield v Sargent  IRLR 94 (CA) and Showboat Entertainment Centre Ltd v Owens  IRLR 7
Notwithstanding the recognition that this case was nuanced, the EAT ultimately found that:
Based on the factual picture it is, we think, plainly and unarguably the case that gay customers were treated less favourably on the grounds of their sexual orientation. Consequently, on the principles of Showboat and Wethersfield the Claimant was treated less favourably on the grounds of sexual orientation.
This case was finely balanced but demonstrates that whilst a company’s policy may not in itself be discriminatory against a particular group to the extent that it is unlawful under discrimination law, the way in which that policy is implemented could give rise to a claim for unlawful discrimination.
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