HM Insights

Is it discrimination to exploit a foreign worker due to their vulnerability in the labour market?

No, is the answer given in the case of Nikolova v M&P Enterprises London (UKWEAT/0293/15/DM).

It was held that if an employer exploits a worker because that worker is vulnerable as a result of poor economic position (i.e. poor English skills, low level skills, immigration status, homelessness etc) it does not necessarily mean that the employer has committed discrimination.

Discrimination Foreign Worker Exploit Employment Law Tribunal

For treatment to be discriminatory there has to be less favourable treatment, as compared to a comparator, which occurs because of a protected characteristic.

Background to the case

The claimant was a Bulgarian national who worked as a cleaner in a hotel. She was paid £4.16 per hour. Her employment ended when she complained about her rate of pay.

The employment tribunal held that she had been unfairly dismissed because she had asserted a statutory right to be paid national minimum wage. She was also successful with claims of unlawful deductions from wages, for holiday pay, failure to provide a written statement of particulars, failure to provide itemised pay statements and also for wrongful dismissal.

It was found that employers took advantage of whomever they could that would accept less than the minimum wage. There was no direct link between this unscrupulous behaviour and nationality.

What does the law say?

Under the Equality Act 2010 A person directly discriminates against another person where:

  • he treats him less favourably than he treats or would treat others, and
  • he does so because of a protected characteristic (sex, race etc)

Just because a worker is treated unreasonably it will not necessarily amount to direct discrimination. In order to be successful it must be shown that the individual was treated less favourably because of a protected characteristic.
Rationale for the Decision

In this case the Employment Tribunal and the Employment Appeal Tribunal could not find that the claimant was treated less favourably because of her race. Rather both the Employment Tribunal and the Employment Appeal Tribunal found that the claimant had been treated the way she had because of the fact that she was vulnerable due to her economic position. Simply put, the claimant was prepared to take a job on disadvantageous terms due to her economic situation. The employer treated her badly because of this and not because she was from Bulgaria. That being the case it could not be said that the treatment was on grounds of race.

Impact of this decision

This case is authority for the proposition that an exploitative employer is not necessarily a discriminatory employer. In this case the claimant was vulnerable because of her poor economic position and this is what led to her being treated badly. The employer would have treated those in the same poor economic position just a badly and therefore it could not be said that the claimant was being treated less favourably as a result of her race.

Get in touch

If you’d like to discuss disciplinary processes and dismissals further, then please contact a member of our employment team.

If you have any queries about discrimination or any other protection for employees and workers, please contact Ewan or a member of our employment team.