UK: Unfair Dismissal and Race Discrimination: Use of Racially Offensive Term During a Training Session

Authors: Charlie Urquhart, Ruth Bonino and Sophie Jackson

Mr. Borg-Neal, who has dyslexia, worked as a manager for Lloyds Banking Group plc. He attended a remote “Race Education for Line Managers” training session provided by an external training company.

During the session, Mr. Borg-Neal asked how a manager should handle a situation in which they heard someone from an ethnic minority use a word that might be considered offensive if used by someone not within that minority. When he did not get a response from the trainer, he continued, “The most common example being the use of the ‘N’ word in the black community.” However, when making his point Mr. Borg-Neal did not say “the N word” but, rather, used the full word.

After the session, the training company reported the incident to the Bank. Mr. Borg-Neal was dismissed for gross misconduct following an investigation and disciplinary process. He claimed that his dismissal was unfair and discriminatory on the grounds of his disability and race.

The employment tribunal found that Mr. Borg-Neal had been unfairly dismissed. The tribunal accepted that a reasonable employer could take the view that Mr. Borg-Neal’s use of language was misconduct, but on the specific facts of this case the Bank did not have reasonable grounds for believing it was gross misconduct justifying dismissal. Context was key. Mr. Borg-Neal had used the word only once and had immediately and repeatedly apologised, and the tribunal found that his question was relevant and well-intentioned in the context of the training session and that he had demonstrated clear remorse and that he had learnt from his actions.

The tribunal also found that Mr. Borg-Neal’s dismissal amounted to discrimination arising from a disability. This was because it found that his dyslexia impacted how he expressed himself and was likely to be a strong reason why he used the full word rather than finding a way to avoid it.

The tribunal rejected Mr. Borg-Neal’s claim for direct race discrimination.

Key Action Points for Human Resources and In-House Counsel

This case demonstrates the importance of considering all the circumstances carefully when deciding whether to dismiss an employee for misconduct, and particularly looking at whether a lesser sanction, such as a warning, would be appropriate. Interestingly, even though the Bank had a “zero-tolerance” disciplinary policy, the tribunal’s judgment suggests that an employer can demonstrate zero tolerance of discrimination without dismissal being an automatic sanction for a discrimination-related incident.

Borg-Neal v Lloyds Banking Group plc ET/2202667/22 (4 August 2023)