Last 115.4 Low 111.6 High 116 Change 1.8 Change % 1.5845 Bid 115 Ask 115.2 Currency GBX No Shares 0
  • Home
  • Latest
  • Podcasts
  • Mishcon Academy: Digital Sessions podcast - positive action and recruitment

Mishcon Academy: Digital Sessions podcast - positive action and recruitment

Posted on 25 May 2021

The Mishcon Academy Digital Sessions.  Conversations on the legal topics affecting businesses and individuals today. 

In this episode, how can employers recruit in a fair but diverse way? What is positive action and what lawful steps can employers take and what are the particular issues facing recruitment businesses?

Matt Robinson
Hello and welcome to Mishcon Academy Digital Sessions podcast.  I am Matt Robinson, an Associate in the Employment Team here at Mishcon and I am joined remotely by my colleague, Martha Averley, also an Associate in our team.  This is the first podcast in a two part series looking at equality, diversity and inclusion.  So, Martha, welcome.  Firstly, can you explain why this is such an important topic?

Martha Averley
Hi Matt.  So, equality, diversity and inclusion which is often referred to as EDI, has become a really high profile and important business consideration for employers.  There was always a focus on it long before the pandemic, particularly for gender but the pandemic has been a bid disrupter in many ways and has shone a light on inequalities in all walks of life.  More recently we’ve seen a particular focus on race and ethnicity in light of the Black Lives Matter movement, for example, according to a recent report by the TUC unemployment rates for ethnic minority workers has risen at more than two times the rate for white workers during the pandemic and looking at the very top positions in February this year the number of black people in chair, CEO or CFO positions at FTSE 100 companies fell from two to zero which is a really shocking statistic.  Meanwhile, women only hold 14% of executive directorships and there are only eight female CEOs in the FTSE 100 according to the latest Hampton Alexander report. 

Matt Robinson
Okay.  So, this is clearly a topical issue and obviously, you know, a moral issue as well but do you think there are other reasons why businesses should be focussing on EDI?

Martha Averley
Well, diversity is a really important consideration, not just from a moral but from an economic perspective.  A study by the International Boston Consulting Group found that companies with diverse management teams have 19% higher revenues due to innovation and shareholders are also calling for increased diversity, for example, the Investment Association listed diversity as one of four areas identified as critical drivers of long-term value for companies.  Another interesting trend that we’re seeing is that clients are now asking for details on companies EDI credentials when tendering contracts.  This means that large companies are checking what steps their suppliers in supply chains are taking to address EDI issues.

Matt Robinson
Thanks Martha.  So, again, clearly needs to be a material focus for business but as lawyers we always have to drag it back to the dry letter of the law so, can you discuss a bit about the legal framework which dictates, you know, what factors employers can take into account when recruiting or promoting staff. 

Martha Averley
We always have to drag it back to the law, don’t we?  So, the legal framework is set out in the Equality Act (2010) and it’s important for employers to appreciate what is lawful action and unlawful action as there is often a fine line separating the two.  So, positive action are steps that are lawful that employers can take to improve EDI for a group of people who share a protected characteristic under the Equality Act and these protected characteristics are things such as gender, race or disability, for example, and employers can take these actions so long as these steps are within the limits set out in the Equality Act but it’s worth bearing in mind that positive action is always voluntary and it’s not mandatory and if an employer goes further than is allowed by positive action which is lawful then this strays into positive discrimination which is unlawful.

Matt Robinson
Yeah.  Thanks.  It is a difficult area.  Would you be able to talk a bit more about positive action, what it is and maybe give some examples of how it might work in practice? 

Martha Averley
Yeah, so it’s often good to think about positive action as two different types.

So, the first is general positive action and this is when an employer reasonably thinks that people with a particular protected characteristic are disadvantaged, they might have different needs or might be disproportionately underrepresented in an activity. An employer can take measures to enable or encourage those people to overcome or minimise disadvantages, meet their needs or encourage increased participation for those individuals provided always that those measures are proportionate and whether those measures are proportionate will always depend on the context but, for example, some measures of positive action might include setting targets so, for example, we’ve seen EY are aiming for 20% of its partners to be from an ethnic minority by 2025.  It might be targeting advertising at a specific group.  Another example is expressly saying in job adverts that applications from an under representative group are welcomed in particular.  Another example might be offering internships or open days exclusively to those from a disadvantaged group and finally, employers could provide a group with particular needs with exclusive training opportunities so, for example, if you provided IT training to those in the over sixties age group.

So, that’s the first type of general positive action and the second type is far less common but that’s positive action in recruitment and promotion.  So, this is a power that can be used by employers where they reasonably think people with a protected characteristic are disadvantaged or disproportionately underrepresented so, similar to the general positive action.  In a recruitment or promotion process, they can treat them more favourably than others as long as they are as qualified as that underrepresented group and that’s why this second type is far less common because it’s not widely seen to have two employees, or potential employees, who are just as equal save for the protected characteristic and it’s also worth bearing in mind that that action must always be a proportionate means of achieving a legitimate aim and the employer can’t just have a blanket policy of automatic preference for people who share a protected characteristic. 

Matt Robinson
Yeah.  So, I guess to sort of help people a bit more, have you got any examples of where people have tried to sort of apply the law in practice and how that has turned out?

Martha Averley
Yes, so since the Davies Review and in 2010 and the Hampton Alexander Review in 2016, these reviews set targets for women on the boards of FTSE 350 companies and this has resulted in material progress to achieve the 33% average target of women on boards but although there are lots of success stories often, unfortunately, examples only come to light where things have gone wrong.  So, for example, in the case of Furlong versus Chief Constable of Cheshire Police, there was a recruitment process there for police officers which was found to be unlawful.  What happened was that at interview there was a detailed scoring assessment but that was replaced with a simple pass or fail mechanism which created an artificially low pass threshold and this meant that large numbers of candidates from underrepresented groups were deemed equal to better quality candidates when this was plainly not the case.  So, even if a business is acting with noble aims, it may still be acting unlawfully.  Matt, I was wondering if you have any practical steps employers can take to recruit in an inclusive but lawful way?

Matt Robinson
Yeah, absolutely.  I mean I think the first one, which I think is something that people have been doing for a while now, is try and use blind recruitment strategies.  Studies show unconscious bias towards particular names and, you know, people going to certain Universities or schools.  Now, obviously this is something that is easier to do at the beginning stages in terms of sifting CVs but you can also look at early stage interviews in large recruitment processes where you send candidates written questions, for example.  Then, as the process develops into face-to-face calls and meetings, you know, obviously it’s not possible to continue that but the idea is that by that point you will have broadened out the diversity of the pool of candidates in the later stages of the process.  Another example is unconscious bias training.  Now, obviously, there has been some recent negative press around unconscious training, I know the Government don’t seem to appreciate it but I think what it can help people realise is that we all have biases and there is concern and evidence that people often want to recruit in their own image and when your existing workforce isn’t diverse in the first place then that lack of diversity is perpetuated.  So, you know, whilst it is difficult to apply in practice, I think if you ensure that people involved in these recruitment processes or promotion decisions are aware of their biases, it may increase the diversity of the candidates that are ultimately selected.  Another way to try and improve diversity is to focus on social mobility initiatives which improve the chances of access for people from less privileged backgrounds and as people from ethnic minorities, for example, will be overrepresented in those groups, the idea is that you can improve your diversity by focussing on a consideration which is not specifically related to a protected characteristic.  You can also look at having a less formulaic or rigid process when considering applicants for a role or for promotion so, I think going back to what you talked about, Martha, earlier about, you know, not just focussing on specific educational qualifications or attendance at certain types of Universities but focussing more on the experience that particular candidate may have or what specific traits that you feel are going to be required for that role and see if you can determine that through the process. 

I think it’s also important for businesses to ensure that they are collecting data in their own business about the diversity of their current workforce and then looking at ways of trying to analyse that data, you know, finding areas of the business which may be less diverse and to try and understand a bit more about why that might be, now there are obviously other considerations at play from a legal perspective, I can’t not drag it back to the law again but, you know, there are going to be data protection issues so you’ve got to make sure that you are communicating to staff that you are going to collect that data and what you are going to process it for but it can be very helpful.  And then, coming at it from another direction but I think ensuring that you’ve got really good, flexible working policies and compensation strategies to ensure that, you know, not only do you recruit in a diverse way but that also that you can retain that talent and ensure that you still retain a diverse workforce all the way up to the top of your business.

Martha Averley
Thanks Matt, really useful practical steps.  So, we’ve discussed the general issues for employers but how does this affect recruitment businesses who are engaged by clients to supply temporary or permanent workers?

Matt Robinson
Yeah.  The issue of the, you know, positive action straying into unlawful positive discrimination will apply whether a company is recruiting a candidate directly or whether they’re using an intermediary recruitment business and from a legal perspective, again, recruitment businesses themselves can be liable for discrimination if they knowingly help the end client to unlawfully discriminate.  So, an example of that might be if the employer says I only want you to provide female candidates for this role and if the recruitment business agrees to such a request, they would be knowingly helping the employer to discriminate on the grounds of sex which we talked about as one of those protected characteristics.  Now, there is a defence for those recruitment businesses that they can rely on a statement from their client that they’ve not broken Equality law but if they want to rely on that defence, it has to be reasonable so, if you go back to the example I just gave where they’ve been given a direct instruction to only produce female candidates, or provide female candidates, it would likely that they would struggle to rely on that defence because it is not going to be possible for them to say that they reasonably thought that the statement given by their client that they had not broken Equality law was correct.  You know, and it’s a slight invidious position to be in because the recruitment business obviously on the one hand wants to provide a good service to their clients and meet their demands but they’ve also got to think about their legal obligations and, you know, the commercial risk that they are exposing themselves to so, you know from a practical perspective, I think it’s important that the recruitment businesses train their own staff so that they understand what’s a lawful or what’s an unlawful recruitment process, you know, have some guidance that they can provide to their clients on positive action and positive discrimination and what types of requests can be agreed to and what types they would have to push back on and I think also, you know, having internal processes in place in their businesses for escalating concerns from their consultants to people more senior in the business when they get a request which they are concerned about or that they think may cross over that boundary which, you know, as we discussed is quite difficult between positive action and positive discrimination, you know, they can escalate that internally within the business and then the more senior people who may have those client relationships with the business can step in and manage that process.  And then finally, you know, recruitment businesses can also try and broaden the diversity of their own candidate pool and try and ensure wherever possible that they are providing a diverse range of candidates whenever they are asked to source a role and then you are going back to some of the examples that we gave previously about the practical steps that the businesses can take, you know, it’s working with their clients to encourage a more flexible approach to the recruitment process which may mean not just looking at those considerations about educational requirement or which Universities they went to but being more flexible, thinking more about the nature of the role and ensuring that they get a more diverse range of candidates and who will be considered for those roles so, it’s trying to get a better handle and it will build those relationships with their clients as well which would be always positive. 

Martha Averley
Thanks Matt.  We’re going to wrap this up now but please do join us again for a future podcast in this serious about the use of technology in the recruitment process and how it can be used to lawfully recruit diverse talent. 

The digital sessions are a series of online events, videos and podcasts, all available at Mishcon.com and if you have any questions you’d like answered or suggestions of what you’d like us to cover, do let us know at digitalsessions@mishcon.com.  Until next time, take care. 

The Mishcon Academy Digital Sessions.  To access advice for businesses that is regularly updated, please visit mishcon.com.

Join Employment Associates Matt Robinson and Martha Averley where they discuss how employers can recruit in a fair but diverse way, explain positive action and what lawful steps employers can take, and break down what particular issues facing recruitment businesses are.

Mishcon Academy: Digital Sessions are a series of online events, videos and podcasts looking at the biggest issues faced by businesses and individuals today.


Visit the Mishcon Academy for more learning, events, videos, podcasts and reports.

How can we help you?
Help

How can we help you?

Subscribe: I'd like to keep in touch

If your enquiry is urgent please call +44 20 3321 7000

I'm a client

I'm looking for advice

Something else