Mr K El-Badry v Global Banking School Ltd and Global Edu Services Ltd: 3311584/2023
JUDGMENT
[1]The respondent’s application to strike out the claim under Employment Tribunal Rule 38(1)(a) because it has no reasonable prospect of success, alternatively for a deposit order because it has little reasonable prospects of success, fails.[2]The claimant’s application to amend his claim to include an allegation of indirect race discrimination – that the 2nd respondent had a policy of not having a sponsor licence for Tier 2 visa holders – succeeds.[3]The claimant withdraws the following claims, which are dismissed on withdrawal: a) All direct race discrimination detriment during employment claims save for the allegation that the respondent revoked his approved annual leave in December 2022; b) Claims of harassment related to race and/or harassment related to sex; c) direct sex discrimination; d) unlawful victimisation; e) claim for notice pay. Claimant’s application to amend[4]The claimant relies on what he says are factual issues contained within his claim: that the 2nd respondent, an associated company of the 1st respondent, had a policy that it would not consider obtaining a sponsorship licence which would enable it to employ Tier 2 visa holders; this disadvantaged him (and would disadvantage other employees with Tier 2 visas), as his (and their) employment could not transfer to the 2nd respondent under TUPE.[5]The claim form contains significant detail of this factual allegation. For example, paragraphs 15.1.4 - 15.1.15 detail the fact that TUPE applied to the potential transfer of his employment, that he received “assurances” that he would not be subject to the TUPE transfer, that his employment status would remain unchanged and he would remain employed by the 1st respondent. He says that during his termination meeting he was told that the 1st respondent could no longer sponsor his visa, that he was given no notice that he was being dismissed, that there was a “clandestine decision” to terminate his employment. He alleges “deliberate manipulation to create a pretext for the transfer, followed by a claim that [the 2nd respondent] could not sponsor my visa”, leading to his dismissal.[6]Paragraph 16.1.4 states that the issue of sponsorship and the 1st respondent’s decision terminate his contract amounts to “potential racial discrimination”; paragraph 16.1.5 - 7 references the “obligation” of the 2nd respondent to apply for a licence “to ensure the rights and continuity of employment for the sponsored workers”. He argues this could amount to race discrimination; he mentions discrimination based on race under the Equality Act provisions (16.3.2).[7]However, the claim form does not say whether this allegation is one of direct or indirect, or other type of race discrimination. The only reference to this allegation in the List of Issues dated 21 May 2024 (96) - an allegation of direct discrimination against the 1st respondent (the 2nd respondent not having been joined at this time): there was a failure to transfer his employment to the 2nd respondent, and he was dismissed.[8]In his application to amend, a document entitled “claimant’s position on TUPE”, the claimant specifies the following: that the 2nd respondent had a PCP “of not employing or retaining staff who require visa sponsorship”. During the hearing the PCP was clarified as the 2nd respondent had a practice of not having a sponsor licence.[9]The claimant expressed his claim as follows: he was part of the respondent's marketing function, and “organised grouping” who were due to transfer to the 2nd respondent under TUPE. The 1st and 2nd respondents are owned by the same person. The 2nd respondent refused to obtain a sponsorship licence. The claimant relies on the EAT case of Osborne Clarke v Purohit – a ‘blanket refusal’ to obtain a license may amount to a PCP, as this is a ‘neutral’ policy companywide policy. The claimant says that this policy would adversely affect any transferee or job applicant who required a sponsor to take over their Tier 2 visa.[10]The claimant says that this allegation – the 2nd respondent had a policy; he was the employee adversely affected – “is explicitly pleaded” in his claim. He says that he was unaware that this could be framed as indirect discrimination “but this is in the claim”.[11]The claimant accepts that he has made several applications to amend, and all were refused at the 19 July 2024 hearing. However, the previous indirect discrimination application related to the TUPE process, rather than the visa sponsor issue. He argues that this is a new application to relabel his claim, rather than a repeat of his previous applications to amend. Respondent’s arguments on the claimant’s application to amend[12]The respondents argue that this application is an abuse of process because it was addressed and dealt with in the claimant’s prior applications to amend his claim, all of which were rejected (page 100). See the claimant's 87-page application to amend, and the claimant’s own record of what he said at the 21st May 2024 CMPH (92).[13]While the respondent will not release its note on what was discussed at that hearing, the current application was clearly addressed at that hearing. The claimant is now seeking to renege on the prior Order, producing a “different account” of his claim.[14]The reason why this application is made is because the claimant is now aware that his claim of direct discrimination cannot succeed – the reason being that the treatment he complains about is not his race but his immigration status, as articulated in the respondents’ strike-out application (see Onu v Akwiwu).[15]The respondent argues that the claim form does not implicitly contain any allegation of indirect discrimination – the claim states that this was a decision targeted at him, rather than a neutral policy. While the claim does state there was an “obligation” to obtain a sponsor licence, the thrust of his claim is that he was targeted because he is not Indian, that this is the reason why no sponsors licence was sought.[16]In addition, it is clear that this is a reformulation of the previous application to amend the discrimination claim which was dismissed. The new allegation is in essence an argument that the 2nd respondent was under an obligation to apply for a licence because of TUPE, and a failure to do so is a TUPE violation. The respondents do not accept that the PCP of the 2nd respondent not having a sponsor's licence is a new allegation. The substance of this application is that the PCP is the same as the dismissed proposed amendment, that the respondents implemented TUPE in a manner which disproportionately affected foreign nationals requiring a Tier 2 visa; the 2nd respondent’s failure to have a sponsor licence was central to that rejected amendment allegation.[17]The application is made late in the day, after the respondents’ application to strike out the direct race discrimination claim; this is the 2nd day of the 4th preliminary hearing, after a hearing at which the issues were defined, after 3 applications to amend which were all dismissed. The respondents accept that there are no reasons given for this decision in the 19 July 2024 Order, and it is not immediately apparent which allegations are being referred to in this decision (100).[18]But the documents objectively suggest that the current application to amend was the same as the applications which were dismissed, that the issue of the sponsors licence was “integral” to the issues addressed in the claimant’s prior applications to amend. The claimant cannot apply to amend his claim on these lines again by rewording a complaint of a failure to implement TUPE. This is “a 2nd bite of the cherry”[19]If it is not the same application, it is substantially the same, and there is significant prejudice if this were allowed; the claimant should be “expected to know what his case is”, and the only change in the past 10 months is that the claimant has realised he does not have a good direct discrimination claim “the claimant chose the wrong horse” which is not a good reason to allow the amendment[20]The respondents accept that if the applications is a relabeling of existing facts there is a "limited issue” on time; but given how old the claim us this is a factor - the timing and manner of the application, in particular after three amendment applications have been made and refused “enough is enough”.[21]On prejudice – this will come down to whether documents have been preserved and its evidence on justification: but these events are over two years ago, and the reason why the 2nd respondent did not apply for a sponsor licence will become a factual issue for the first time in the claim. The law[22]Relevant case law a) Selkent Bus Co Limited v Moore, [1996] ICR 836: In deciding whether to exercise its discretion to grant an application to amend, the tribunal “should take into account all the circumstances and should balance the injustice and hardship of allowing the amendment against the injustice and hardship of refusing it”. Factors, amongst others, which may be relevant include: i) the nature of the amendment, including the "... substitution of other labels for facts already pleaded to”; ii) the applicability of time limits: a new claim may be out of time, and it is necessary to consider whether the time limit should be extended, in this case the test if whether it is “just and equitable” to extend the time limit; iii) the timing and manner of the application: any delay in making the application may be a factor to consider – why was it not made earlier? iv) the “paramount considerations” are the relative injustice and hardship involved in refusing or granting an amendment. b) MacFarlane v Commissioner of Police of the Metropolis [2024] ICR 22 EAT: it is permissible for a Tribunal to have regard to the prospects of success of a claim. Conclusion on the application to amend[23]There is ambiguity over which amendment allegations were addressed at the 19 July 2024 hearing (100). No reasons were provided; there is no detail of the amendment applications which were considered. The nature of the amendment applications are not clear on the vast amount of paperwork (100 pages approximately) in the claimant's 3 applications to amend. The Order does not state the claimant's right to request reasons.[24]I note that at paragraph 18.1.3 of the Order dated 21 May 2024 (page 92) states that the applications to amend the claim contains the following allegation: indirect race discrimination as the claimant was put to a particular disadvantage by the “... application of the TUPE regulations”.[25]The current application at this hearing is different: it is indirect race discrimination on the 2nd respondent’s policy of not having a sponsorship licence. While the respondents say this application was addressed and dismissed, on the face of the prior application as formulated in Case Summary in the Order of 21 May 2024, it appears that this specific application was neither made nor addressed at any prior hearing[26]To reiterate, the claim has a detailed factual account of this issue, that the failure to transfer him to the 2nd respondent amounts to race discrimination. This issue was formulated in the Tribunal’s list of issues as direct discrimination against the 1st respondent before the 2nd respondent was added as a party.[27]I therefore accept that the issue of the failure of the 2nd respondent to obtain a sponsor's licence and transfer him is detailed within the claim. I also accept that the current application to amend has not been considered previously. The addition of the 2nd respondent means that the issues in the claim, the issues that the 2nd respondent must address, have changed. The claim must be considered to determine which allegations are for the 2nd respondent to meet.[28]Given the summary of the amendment application at pages 92-3, I find on balance that it is unlikely that the issue of the failure to have a sponsor licence as an allegation of indirect discrimination was considered at the 19 July 2024 hearing.[29]I consider that the amendment the claimant now seeks is a Selkent labelling exercise, to change a currently pleaded allegation in respect of the failure to transfer because of the sponsorship licence issue to one of indirect discrimination.[30]I accept that this application was made following the respondents’ application to strike out the claim of direct race discrimination in respect of the visa issue. The respondents’ arguments on this application had significant force: that the direct discrimination claim in respect of the visa issue stood no reasonable prospects of success based on the Onu case, that immigration status is not a proxy for race. The respondents’ application was considered but not determined at the part-heard hearing on 20 May 2025, the application to amend was made subsequently.[31]I accept that the timing and manner of this application is very late in the proceedings, after several case management orders, and that it appears to be an attempt by the claimant to get around the strong possibility that the direct race discrimination case may be struck -out or a deposit ordered. In other words, it is a reactive application to seek to save a major element of the claim.[32]The claimant's explanation for seeking this amendment now is that he is acting in person, he was unaware of how indirect discrimination worked, he did not know that the allegations he made could not be covered by direct discrimination; it is only after the respondents’ application to strike out his claim that he researched the relevant principles.[33]On the relative injustice to the parties: if the claimant's application to amend is not allowed, and if the respondents had succeeded in their application to strike out the direct race discrimination allegation, the claimant would have no claim in respect of his dismissal. Clearly, this is highly prejudicial to the claimant. Conversely, the respondents are aware that the claimant has sought throughout his claim to argue that the failure to transfer him is discriminatory. While there is clearly prejudice to a respondent having to continue to defend the claim, the relative hardship is clearly weighted towards the claimant, who would lose his main allegation that his dismissal was discriminatory, if the amendment was refused.[34]I also take into account the potential merits of the claim. The respondents say that the claimant’s articulation of the PCP cannot work, as it is not a policy which applies to all employees – UK born employees do not need a visa, so this policy is irrelevant to them. The claimant, relying on Osborne Clark Services v Purohit, argues that the 2nd respondent’s policy of automatically refusing to transfer employees who required a Tier 2 visa, amounts to indirect race discrimination on the grounds of nationality.[35]On the facts it is accepted that the respondents did not transfer him, that the reason was because the 2nd respondent did not have a sponsor licence and was not prepared to apply for one. As put in its oral submission the respondents argue “the reason the claimant did not transfer is because the 2nd respondent did not have a visa sponsor licence and therefore they could not employ the claimant”; that this claim is in fact about “the right to work in the UK”. It accepts that the claimant was the sole employee in the Marketing Team who did not transfer. Given this, it appears to me that the claimant has an arguable claim of indirect race discrimination, and I take this into account in my assessment.[36]I also accept that the application was made at a relatively late stage in the proceedings (albeit over a year before the listed full-merits hearing) and I accept that it is a reactive application made in response to a strike-out threat.[37]However, given the apparent merits of the amendment application, and given that this is a labelling exercise, and given that the relative hardship is weighted against the claimant were the application not allowed, I consider it is just and equitable to extend time and allow this amendment. Respondent’s strike-out / deposit order application[38]Much of this falls away given the claimant’s withdrawal of much of his claim. The one remaining direct race discrimination detriment in employment allegation is the withdrawal of leave. The respondents argue that notwithstanding there is a factual dispute about what happened, this is a claim which should be struck out on the basis that there is “no realistic prospect” of it succeeding.[39]The claimant says that he was required to take this leave as he was required to return to Egypt to register for military service, which must be done in person. The respondent knew this, but forced him to cancel his leave anyway, putting him at legal jeopardy in Egypt. The respondents argue that the 1st respondent had an inspection from the Home Office, who required to speak to a staff member from its list of sponsored workers, that it required “all” of its sponsored workers to be available on that day. It says that the claimant decided to cancel his trip, that the 1st respondent had no knowledge that he faced legal jeopardy in doing so (159- 60). It argues that while the claimant may be able to establish a difference in race with a hypothetical comparator, he cannot establish that the treatment was because of his race. It argues that this claim has no, alternatively little, reasonable prospects of success.[40]The claimant argues that the same email makes it clear that he would “have to endure the consequences” of the decision to cancel his trip. He says that he made it clear to the 1st respondent's CEO of the necessity of travelling to Egypt on that date, that he specified that there were criminal consequences if he failed to do so. He argues that an Indian national employed under a Tier 2 visa (or which there were at least 3 employed by the 1st respondent) would have been allowed to leave on pre-booked leave for a mandatory appointment in their home country in similar circumstances.[41]The claimant’s case is that the 1st respondent’s Mr Rana forced the claimant to cancel his leave, that he was not given any option. He wrote his email confirming this because he felt he needed to appease Mr Rana, that the claimant has significant evidence of Mr Rana’s conduct towards him, and he wanted to keep his job.[42]In determining not to strike out this claim, I note that the claimant's case is that Indian nationals employed by the respondent would have been treated more favourably. The respondent disputes it was informed of the necessity of his travel; the claimant says he has evidence that he did so. He says that he was singled out by managers because he is not of Indian origin.[43]While the respondents say the documents speak for themselves, there is a significant dispute about what the respondent was aware of, what the claimant told Mr Rana and whether he was forced to cancel, or volunteered to cancel his leave. I accept that the claimant’s arguments that his allegation that his nationality was a factor in this treatment cannot be said to have no reasonable, or little reasonable, prospects of success. The whistleblowing claim[44]There is still a dispute as to whether this claim was withdrawn by the claimant. The Order dated 28 February 2025 says that this claim was withdrawn by the claimant at the hearing on 19 July 2024. The claimant disputes that he did so, and the withdrawal is not noted in the 19 July 2024 Order. The last direction given in respect of this issue, in a tribunal letter dated 1 May 2025, was that the claimant's application – effectively for a review of the order of 28 February 2025 that the claimant ‘cannot continue’ with his whistleblowing claim – should be considered at this hearing.[45]The respondent says that it must be the Employment Judge who made this order to consider the application for review. The parties understand that the judge is seeking to listen to the recording of the 19 July 2024 hearing to reassess whether the claimant did withdraw this claim. The respondent does not accept that a different judge has the power to address this issue.[46]I accept that this is an urgent issue which requires addressing, because on the claimant's case he did not withdraw his whistleblowing claim, he certainly did not intend to withdraw an allegation which he says is central to his case. This, however, is an issue which it appears should if possible be addressed by the Judge who heard the submissions at the 19 July 2024 hearing.[47]If that is not possible or likely to occur by 1 October 2025, I direct that this issue be returned to me for a decision. Approved by: