Ipsofactoj.com: International Cases [2004] Part 1 Case 3 [HL]


HOUSE OF LORDS

Coram

MacDonald

- vs -

Advocate General for Scotland

LORD NICHOLLS OF BIRKENHEAD

LORD HOPE OF CRAIGHEAD

LORD HOBHOUSE OF WOODBOROUGH

LORD SCOTT OF FOSCOTE

LORD RODGER OF EARLSFERRY

19 JUNE 2003


Judgment

Lord Nicholls of Birkenhead

My Lords,

  1. These appeals raise three points on the application of the Sex Discrimination Act 1975. In their speeches my noble and learned friends Lord Hope of Craighead and Lord Rodger of Earlsferry have set out the facts of the two cases. I shall not repeat them.

    SEX DISCRIMINATION AND SEXUAL ORIENTATION

  2. Mr. Macdonald was dismissed from the Royal Air Force because he was a homosexual. Ms Pearce was subjected to a sustained campaign of harassment while employed as a teacher at Mayfield School, because she was a lesbian. Each claims that this treatment comprised 'direct' sex discrimination, that is, discrimination as defined in section 1(1)(a) of the 1975 Act. Section 1(1)(a) provides that a person discriminates against a woman if 'on the ground of her sex he treats her less favourably than he treats or would treat a man'. The definition applies correspondingly in the case of discrimination against a man. Mr. Macdonald's case is that, on the ground of his sex, his employers treated him less favourably than they would have treated a woman. Ms Pearce's case is the converse. She was less favourably treated, on the ground of her sex, than her employers would have treated a man

  3. Much of the argument in these two appeals was directed at identifying the appropriate persons with whom the appellants are to be compared when making the 'less favourable treatment' comparison. This issue was placed at the forefront of the appellants' submissions. The statute, they said, envisages a simple comparison of how the claimant was treated and how a person of the opposite sex would have been treated in the same circumstances. Had Mr. Macdonald been a woman, he would not have been dismissed. He was dismissed because he was sexually attracted to men. A woman in his position, sexually attracted to men, would not have been dismissed. Ergo, it was said, he was less favourably treated than a woman in his position would have been, and he received this treatment because he was a man, that is, on the ground of his sex. Hence, his case satisfies the statutory definition of discrimination in section 1(1)(a).

  4. The opposing arguments focused on the need for a 'like with like' comparison, as underlined by section 5(3). To compare Mr. Macdonald with a heterosexual woman is not to compare like with like. The appropriate comparator is a lesbian. She too would have been dismissed under the policy then prevailing in the armed forces. So Mr. Macdonald did not receive less favourable treatment on the ground of his sex. Similar arguments were advanced in the converse case of Ms Pearce.

  5. My Lords, in the recent decision of your Lordships' House in Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] ICR 337, paras 7 to 12, I noted that in cases of direct sex discrimination difficulties may arise in attempting to decide whether the employer treated a claimant woman less favourably than he would have treated a man without knowing the reason why the claimant was treated as she was. A similar flaw permeates the appellants' arguments in the present appeals. The reasons why Mr. Macdonald was dismissed and Ms Pearce was harassed and humiliated are clear. But the appellants seek to put these reasons on one side and disregard them when identifying, as the first step in their argument, the appropriate comparator for this man and this woman.

  6. I prefer to approach the matter from the other end. I start by considering the reasons for the treatment of which complaint is made. Approached in this fashion the appeals become straightforward. Take Mr. Macdonald's case. He was dismissed because he was a homosexual. This was pursuant to a policy adopted towards service personnel, of either sex, who were sexually attracted to persons of the same sex. This, and this alone, was the reason for Mr. Macdonald's dismissal. Plainly, this was a discriminatory policy. But, equally plainly, it was a policy which discriminated between people solely on the ground of their sexual orientation, not on the ground of their sex. The policy was gender neutral, applicable alike to men and women and, moreover, applied alike to men and women.

  7. For this short reason Mr. Macdonald's principal ground of appeal must fail. It must fail because it was common ground, and rightly so, that in the context of section 1 of the Act 'sex' means gender and does not include sexual orientation. Gender and sexual orientation are distinct personal characteristics. In the Sex Discrimination Act Parliament proscribed gender as an acceptable basis for discrimination in the circumstances specified in the Act. Since the Act was admittedly not aimed at sexual orientation, there can be no justification for interpreting the expression 'on the ground of her sex' in section 1 expansively so as to include cases which, in truth, are cases of discrimination solely on the ground of sexual orientation. Perceived deficiencies in this regard in the legislative scheme are soon to be made good, in the field of employment and to a limited extent elsewhere, when in the near future the government duly fulfils the United Kingdom's obligations under Council Directive 2000/78/EC of 27 November 2000.

  8. For the like reason so also must Ms Pearce's principal ground of appeal fail. The disgraceful way she was treated by some of the pupils at the school was because of her sexual orientation, not her sex. Ms Pearce accepted that the children would have pursued a comparable campaign of harassment against a homosexual man.

  9. For good measure I add that, having identified sexual orientation as distinct from sex, as the sole reason why Mr. Macdonald was dismissed, there is no difficulty in identifying the appropriate comparator. Given the reason for Mr. Macdonald's dismissal, it is readily apparent that the appropriate comparison is with a homosexual woman. Otherwise one would not be comparing like with like. Comparison with the treatment afforded to a heterosexual woman would not be a comparison where the circumstances of one case are materially the same as the other, as required by section 5(3). When Mr. Macdonald is compared with a homosexual woman it is evident that he was not less favourably treated than she would have been. She also would have been dismissed. Similar reasoning in the case of Ms Pearce leads inexorably to the conclusion that in her case the appropriate comparator is a homosexual man and that she too was not treated less favourably than her male comparator would have been.

  10. I should also mention an argument based on the Race Relations Act 1976. The appellants sought to rely on the analogy of the restaurateur who refuses to serve mixed race couples. He will not admit a black man accompanied by a white woman, or a white man accompanied by a black woman. This, it was said, would be racial discrimination. It would be racial discrimination even though the restaurateur's policy applied equally to men of all races.

  11. I agree. That would be racial discrimination. But the analogy sought to be drawn with the present cases is unsound. A restaurateur who refuses to serve a black man because he is accompanied by a white woman would thereby be discriminating on 'racial grounds'. That phrase is amply wide enough to include such a case. This treatment would not cease to be discrimination on racial grounds because the restaurateur would equally discriminate on racial grounds in the converse situation of a white man and a black woman.

  12. This is to be contrasted with the present cases. An employer who dismisses a male employee because of his sexual orientation is not discriminating against him on the ground of his sex. The employer is discriminating against him on a ground which is outside the scope of the legislative prohibition.

  13. For this reason the appellants are not assisted by the Northern Ireland case of Smyth v Croft Inns Ltd [1996] IRLR 84, where a barman in a public house with Protestant customers in a 'loyalist' area of Belfast was constructively dismissed because he was a Roman Catholic. That was rightly held to be discrimination 'on the ground of religious belief' within the meaning of section 16 of the Fair Employment (Northern Ireland) Act 1976, as amended by the Fair Employment (Northern Ireland) Act 1989. The employer's conduct did not cease to be discrimination on that ground because the employer would have treated in the same way a Protestant barman in a public house with Roman Catholic customers. As Sir Brian Hutton LCJ said, that showed only that the employer would be guilty of religious discrimination against both barmen: see [1996] IRLR 84, 85-86, paragraph 28.

    SEXUAL HARASSMENT

  14. Ms Pearce advanced her claim on an alternative basis. She was subjected to a campaign of gender specific harassment. She was vilified in terms which would not have been used against a man. This, it was submitted, is capable of amounting to less favourable treatment on the ground of her sex without the need to identify a male comparator and regardless of the reason for the campaign. Mr. Macdonald advanced a similar argument regarding the intrusive questioning he suffered at an interview with his superior officer.

  15. The starting point here is to note that the expression 'sexual harassment' is ambiguous. The adjective 'sexual' may describe the form of the harassment; for instance, verbal abuse in explicitly sexual terms. Or it may be descriptive of the reason for the harassment; for instance, if a male employee makes office life difficult for a female employee because he does not wish to share his office with a woman. It is only in the latter sense that, although not as such prohibited by the Sex Discrimination Act, sexual harassment may nevertheless be within the scope of the Act as less favourable treatment accorded on the ground of sex. A claim under the Act cannot get off the ground unless the claimant can show she was harassed because she was a woman. A male employee may make office life difficult for a female employee, not because she is a woman, but because he objects to having anyone else in his office. He would be equally unwelcoming to a male employee. Harassment of a woman in these circumstances would not be sex discrimination.

  16. In some cases there are suggestions of a different approach. It has been suggested that if the form of the harassment is sexual, that of itself constitutes less favourable treatment on the ground of sex. When the gender of the victim dictates the form of the harassment, that of itself, it is said, indicates the reason for the harassment, namely, it is on the ground of the sex of the victim. Degrading treatment of this nature differs materially from unpleasant treatment inflicted on an equally disliked male colleague, regardless of equality of overall unpleasantness: see Lord President Emslie in Strathclyde Regional Council v Porcelli 1986 SC 137, 145-146; [1986] ICR 564, 568-570. Because the form of the harassment is gender specific, there is no need to look for a male comparator. It would be no defence to a complaint of sexual harassment that a person of the opposite sex would have been similarly treated: see Morison J in British Telecommunications Plc v Williams [1997] IRLR 668, 669.

  17. In agreement with Ward LJ in Smith v Gardner Merchant Ltd [1999] ICR 134, 147-148, I respectfully think some of these observations go too far. They cannot be reconciled with the language or the scheme of the statute. The fact that the harassment is gender specific in form cannot be regarded as of itself establishing conclusively that the reason for the harassment is gender based: 'on the ground of her sex'. It will certainly point in that direction. But this does not dispense with the need for the tribunal of fact to be satisfied that the reason why the victim was being harassed was her sex. The gender specific form of the harassment will be evidence, whose weight will depend on the circumstances, that the reason for the harassment was the sex of the victim. In some circumstances the inference may readily be drawn that the reason for the harassment was gender based. A male employee who subjects a female colleague to persistent, unwelcome sexual overtures may readily be inferred to be doing so on the ground of her sex.

  18. In the case of Ms Pearce the abuse was in homophobic terms: 'lezzie', 'lemon', 'lesbian shit' and the like. The natural inference to be drawn from this form of abuse is that the reason for this treatment was Ms Pearce's sexual orientation, not her sex. Further, as the employment tribunal noted, Ms Pearce did not put forward any evidence or argument that a male homosexual teacher would have been treated any differently either by the pupils or by the school. This being so, Ms Pearce did not establish that the harassment was on the ground of her sex. Her appeal on this second ground also must fail.

  19. Similarly with Mr. Macdonald: the evidence, accepted by the employment tribunal, was that faced with a lesbian female officer Wing Commander Leeds would have conducted the vetting interview on very much the same lines. The sole reason for the intrusive nature of the questioning was Mr. Macdonald's sexual orientation.

  20. As with sexual orientation, so with sexual harassment, the law is in the process of being changed. Here again, however, this change in the law will come too late to assist the appellants. The Equal Treatment Directive (Council Directive 76/207/EEC) has recently been amended by Council Directive 2002/73/EC of 23 September 2002. In article 2 of the Equal Treatment Directive as amended, sexual harassment is specifically identified by reference to the form of the harassment and is, as such, prohibited. Sexual harassment is defined as 'any form of unwanted verbal, non-verbal or physical conduct of a sexual nature' having 'the purpose or effect of violating the dignity of a person, in particular when creating an intimidating, hostile, degrading, humiliating or offensive environment'. Sexual harassment, as so described, is deemed to be discrimination on the grounds of sex. Thus sexual harassment is treated as an independent, free-standing ground of complaint. Member States are required to give effect to the amendments to the Equal Treatment Directive by 5 October 2005.

    HUMAN RIGHTS ACT 1998

  21. It is common ground that the dismissal and other treatment accorded to Mr. Macdonald infringed his rights under the European Convention on Human Rights. The Advocate-General for Scotland accepted that this treatment violated Mr. Macdonald's rights under article 8 (respect for private life) considered separately and in conjunction with article 14 (discrimination). This treatment occurred in 1996 and 1997, some time before the Human Rights Act 1998 was enacted or came into force. Despite this Mr. O'Neill QC submitted that in these proceedings his client is able to rely upon the Human Rights Act.

  22. Mr. O'Neill's primary submission was that the appeal to the Court of Session, lodged by the Ministry of Defence against the decision of the Employment Appeal Tribunal, itself constituted 'proceedings brought by .. a public authority' for the purposes of section 22(4) of the Act. Therefore, in accordance with section 22(4), Mr. Macdonald may rely upon his Convention rights even though the discriminatory events took place before 2 October 2000.

  23. I do not agree. I leave aside the fact that the appeal before the House is an appeal brought by Mr. Macdonald, not an appeal brought by a public authority. Even leaving this feature wholly on one side, in my view this submission is misconceived. Section 22(4) sets out a consequence attaching to a particular type of proceedings. On a natural reading of the subsection, proceedings are brought when they are first initiated: by the issue of a writ, or making a discrimination claim, or whatever. Subsequent steps in the proceedings, including an appeal, are all part of the proceedings for the purposes of section 7(1)(b) of the Act. They are directed towards the proper disposal of the proceedings. In the ordinary course they are not themselves separate proceedings for the purpose of section 22(4). To treat them as separate proceedings would lead to irrational and capricious results. It would mean that the law falling to be applied to a single set of proceedings would vary depending on the adventitious circumstance of which party was the appellant. In proceedings initiated against a public authority section 22(4) would not avail the claimant at the trial of his claim by a court of first instance. If the court of first instance reached a correct conclusion, adverse to the claimant, that would be the end of the matter. But if the trial judge erred, and the public authority defendant appealed, the rules would change and on the hearing of the appeal the claimant could now rely upon pre-Act infringements of his human rights. He could rely on these pre-Act infringements to determine the outcome of the proceedings initiated by him. I do not believe this is the proper interpretation of section 22(4). On this I respectfully disagree with the contrary view expressed by Lord Prosser in the Inner House: [2002] SC 1, 7, para 15.

  24. Nor can I accept Mr. O'Neill's alternative submission that, given the admitted infringements of Mr. Macdonald's human rights, prosecution of an appeal by the Ministry of Defence after the Human Rights Act came into operation constituted an 'act' prohibited by section 6(1). A public authority does not act unlawfully by defending proceedings which are based on pre-Act events when the statute itself provides that a person cannot rely upon pre-Act events in proceedings brought by him against a public authority. An appeal brought by a public authority in such proceedings stands on the same footing.

  25. For these reasons, as well as the reasons given by Lord Hope of Craighead and Lord Rodger of Earlsferry, with which I am in broad agreement, I would dismiss both appeals.

    THE THIRD ISSUE

  26. On this footing the third issue, which affects only Ms Pearce, does not call for decision. This issue concerns an additional hurdle Ms Pearce would have to cross if her claim were to be successful. Her claim is against the school as her employer. But the campaign of abuse mounted against her was a campaign by pupils of the school, not by members of the school staff. So Ms Pearce is not assisted by section 41(1) of the Sex Discrimination Act. This provides that, subject to the defence set out in section 41(3), acts done by an employee in the course of his employment are to be treated as done also by his employer. Nor were the pupils acting as agents of the school, so as to give rise to liability under section 41(2).

  27. Mr. Emmerson QC sought, nevertheless, to fix the school with liability. The school, he submitted, could and should have taken steps to shield Ms Pearce. Its failure to do so constituted sex discrimination. Reliance was placed on the decision of the Employment Appeal Tribunal in Burton v De Vere Hotels Ltd [1997] ICR 1. In the present case the employment tribunal accepted this submission.

  28. This submission, although not calling for decision, raises a point of some general importance. In Burton v De Vere Hotels Ltd [1997] ICR 1 two black waitresses, clearing tables in the banqueting hall of a hotel, were the butt of racist and sexist jibes made by a guest speaker entertaining the assembled all-male company at a private dinner party. The Employment Appeal Tribunal held that the employer of the waitresses had racially discriminated against the waitresses. Had the assistant managers in charge for the evening been properly instructed, the two young women would not have suffered embarrassment. They could, and should, have been withdrawn from the room.

  29. This is not a satisfactory decision. Lindsay J, sitting as the President of the Employment Appeal Tribunal, has said the decision may be 'vulnerable': see Hussain v HM Prison Service (8 May 2002, unreported). Viewed in the broadest terms, the Burton decision has much to commend it. There is, surely, everything to be said in favour of a conclusion which requires employers to take reasonable steps to protect employees from racial or sexual abuse by third parties. But is a failure to do so 'discrimination' by the employer? Where the Burton decision is, indeed, vulnerable is that it treats an employer's inadvertent failure to take such steps as discrimination even though the failure had nothing to do with the sex or race of the employees. In this crucially important respect the decision gives insufficient heed to the statutory discrimination provisions. An essential element of 'direct' sex discrimination by an employer is that, on the grounds of sex, the employer treats the employee less favourably than he treats or would treat an employee of the opposite sex. Similarly with 'direct' racial discrimination: the 'less favourable treatment' comparison is an essential ingredient of the statutory wrong: see section 1(1)(a) of the Race Relations Act 1976. Unless the employer's conduct satisfies this 'less favourable treatment' test, the employer is not guilty of direct sex or racial discrimination. In making this comparison acts of persons for whose conduct an employer is vicariously responsible are to be attributed to the employer. It is otherwise in respect of acts of third parties for whose conduct the employer is not vicariously liable.

  30. With this in mind, the reasoning in the Burton decision is unsatisfactory in two important respects. First, the tribunal proceeded on the basis that harassment which is race specific in form is itself less favourable treatment on racial grounds. In the case of racial harassment of a black person there is no need to show that a white person would have been treated differently. Counsel's concession on this point was based on an apparently widespread misinterpretation of the decision in Strathclyde Regional Council v Porcelli [1986] SC 137; [1986] ICR 564. This is a point I have already discussed.

  31. Secondly, the harassment in Burton was committed by third parties for whose conduct the employer was not vicariously responsible. Despite this, the tribunal seems to have proceeded on the basis that the racial harassment of the waitresses by the speaker and some of the guests constituted discrimination on the part of the employer, and that the only issue left outstanding on the appeal, if the discrimination claim were to succeed, was whether the employers had by active or passive conduct subjected the waitresses to racial harassment by the speaker and the offending guests. This cannot be right. In order to succeed the two Caribbean waitresses had to prove discrimination by their employer.

  32. On the sole outstanding issue before the tribunal Smith J said, at [1997] ICR 1, 10, para 38:

    The [employment] tribunal should ask themselves whether the event in question was something which was sufficiently under the control of the employer that he could, by the application of good employment practice, have prevented the harassment or reduced the extent of it. If such is their finding, then the employer has subjected the employee to the harassment.

    [Emphasis added]

  33. This decision, I have to say, seems to have proceeded on altogether the wrong footing. 'Subjecting' an employee to 'detriment' is one of the circumstances in which it is unlawful for an employer to 'discriminate' against an employee: section 4(2)(c) of the Race Relations Act 1976. Thus section 4(2)(c) is not satisfied unless the conduct constituted 'discrimination'. To constitute 'discrimination' the definitions in sections 1 or 2 of the Act must be met.

  34. I turn to the facts in the Burton case. The employment tribunal found that although the hotel manager should have instructed his assistant managers to protect the waitresses from the predictably offensive content of the comedian's speech, the manager's failure to do so was not 'less favourable treatment on racial grounds'. His failure to give any thought to what might happen to the waitresses that night was not connected with their ethnic origin. By implication, the tribunal thought the employer would have treated white waitresses in the same way: see [1996] IRLR 596, 598, paragraph 16.

  35. As I see it, these findings negatived racial discrimination on the part of the employer. The hotel's failure to plan ahead properly may have fallen short of the standards required by good employment practice, but it was not racial discrimination. I consider the case was wrongly decided by the Employment Appeal Tribunal, as also was the comparable case of Go Kidz Go Ltd v Bourdouane (unreported) (Employment Appeal Tribunal, 10 September 1996).

  36. Had the factual position been otherwise, and had the employer permitted exposure of the black waitresses to racist remarks by a third party when it would not have treated white employees similarly in a corresponding situation, this would have been a case of racial discrimination. This conclusion would follow from the difference in treatment afforded to black waitresses on the one hand and the treatment which would have been afforded to white waitresses on the other hand. In such circumstances the employer would be liable without it being necessary, or appropriate, to have recourse to 'good employment practice'. Indeed, I doubt whether the concept of good employment practice has a role when determining liability in this type of case. This concept, and that of the hypothetical reasonable employer, need to be handled with much care in the context of the discrimination legislation: see, as an illustration, Glasgow City Council v Zafar [1997] 1 WLR 1659, 1663, per Lord Browne-Wilkinson:

    The fact that .... an employer has acted unreasonably casts no light whatsoever on the question whether he has treated the employee "less favourably" for the purposes of the Act of 1976.

  37. Some will regard this as a deficiency in the structure and scope of the discrimination legislation. I have already noted the desirability of employers taking reasonable steps to protect employees from sexual and racial harassment by third parties. But the discrimination legislation is targeted in precise terms. A fundamental feature of this aspect of the legislation is that attention is focused on the conduct of the particular employer, not the conduct of a reasonable employer. Further, the circumstances where an employer is liable for the acts of others are stated expressly in the legislation. It is not for the courts to extend the ambit of the discrimination legislation, however desirable this may seem, under the guise of interpretation of provisions which are unambiguously clear. As the legislation stands, the employer cannot be in a worse position regarding sexual or racial harassment of an employee by a third party for whose behaviour he is not vicariously liable than he is regarding sexual or racial harassment committed by himself. If his conduct in the latter case must meet the statutory definition of discrimination before it will become unlawful, so also must his conduct, whether by way of act or omission, in the former case.

    Lord Hope of Craighead

    My Lords,

  38. The question which lies at the heart of these two appeals is whether, and if so in what circumstances, homosexuals who have been discriminated against or harassed can obtain a remedy against their employers under the Sex Discrimination Act 1975. Although there is much common ground between the two cases, they arise out of different facts and circumstances. Your Lordships will wish to be provided with a brief account of each of them before turning to the points of law which they have raised. But it may be helpful if I were to begin by setting out the relevant provisions of the statute.

    THE 1975 ACT

  39. Section 1(1)(a) of the Sex Discrimination Act 1975 provides:

    A person discriminates against a woman in any circumstances relevant for the purposes of any provision of this Act if -

    (a)

    on the ground of her sex he treats her less favourably than he treats or would treat a man.

    Section 2(1) provides that section 1, and the provisions of Part II and III of the Act relating to sex discrimination against women, are to be read as applying equally to the treatment of men, with the requisite modifications.

  40. Section 5(3) of the Act provides:

    A comparison of the cases of persons of different sex .... under section 1(1) .... must be such that the relevant circumstances in the one case are the same, or not materially different, in the other.

    Section 6(2), which is in Part II of the Act, provides that it is unlawful for a person, in relation to employment by him at an establishment in Great Britain, to discriminate against a woman by dismissing her, or subjecting her to any other detriment.

    THE FACTS IN MS PEARCE'S CASE

  41. The facts of Ms Pearce's case against the Governing Body of Mayfield Secondary School have been described by my noble and learned friend, Lord Rodger of Earlsferry. I gratefully adopt his account. I should like to deal in my speech with the facts in Mr. Macdonald's case. As Lord Rodger has explained, Ms Pearce's case raises three principal issues. They relate to the choice of the comparator where the claimant is a homosexual, to the question whether a comparator is needed in a case of sexual harassment and to the test of the employer's liability for sexual harassment. In Mr. Macdonald's case there are two principal issues. They are almost identical to the first two issues in Ms Pearce's case - those relating to the choice of the comparator and to the question whether a comparator is needed in a case of sexual harassment.

    THE FACTS IN MR. MACDONALD'S CASE

  42. This is an appeal against an interlocutor of an Extra Division of the Court of Session (Lords Prosser, Kirkwood and Caplan) in a case brought by Roderick Macdonald ("Mr. Macdonald") under the Sex Discrimination Act 1975 against the Advocate General for Scotland as representing the Secretary of State for Defence. Mr. Macdonald served in the Royal Air Force from August 1989 until 28 March 1997 when he was dismissed from the service because he had admitted that he was sexually attracted to men. He claims that in these circumstances he was discriminated against unlawfully by the armed forces on the ground of his sex. His application to the employment tribunal for compensation for unlawful discrimination and sexual harassment was dismissed on 16 December 1999. He appealed to the Employment Appeal Tribunal, which ordered on 19 September 2000 that his appeal be allowed and that a finding that he had been discriminated against unlawfully and was subjected to sexual harassment be substituted: [2001] ICR 1. On 1 June 2002 the Extra Division, by a majority (Lord Prosser dissenting), allowed an appeal by the Advocate General and restored the decision of the employment tribunal: 2002 SC 1; [2002] ICR 174. Mr. Macdonald has invited your Lordships to allow his appeal, restore the order of the Employment Appeal Tribunal and remit his case to the employment tribunal to assess the amount to be awarded to him as compensation.

  43. Mr. Macdonald served in the Royal Air Force from August 1989 until 28 March 1997 when he was dismissed from the service because he had admitted that he was sexually attracted to men. At that time it was the policy of the United Kingdom Government that homosexuality, whether male or female, was inconsistent with service in the armed forces. Paragraph 1032(1) of the Queen's Regulations provided that if individuals admitted to being homosexual while serving and their Commanding Officer judged that the admission was well-founded they would be required to leave the service. Guidance for Commanding Officers on dealing with cases of homosexuality was contained in AP 3392 vol 5, leaflet 107. In paragraph (1) homosexuality was defined as "behaviour characterised by being sexually attracted to members of the same sex."

  44. Mr. Macdonald had previously obtained a commission in the Intelligence Corps as an officer in the Territorial Army. He enlisted into the Royal Air Force on 19 August 1989. On 17 March 1996 after an unbroken period of exemplary service he was posted to RAF Prestwick as Officer Commanding Administration Flight. One of his responsibilities in that position was that of Custodian of Communications Security. As he was aware when he received his posting, this required a form of security clearance which involved a subject interview by a field investigating officer. He was told that the investigating officer would question him in depth about all aspects of his lifestyle, that many of the questions might seem unduly personal but that it was essential that he answered all the questions truthfully and without prevarication as it would damage his security standing if he was found to have lied or withheld information. He knew that in the course of his interview he would be asked about his sexuality.

  45. When Mr. Macdonald was interviewed by the field investigating officer on 10 April 1996 and asked whether he was a practising homosexual he answered in the affirmative. The investigating officer said in his recommendation following the interview that, with the exception of the fact that he was a homosexual, Mr. Macdonald had given no reason to doubt his suitability to hold the required level of security clearance. The matter then passed into the hands of Wing Commander Leeds, a senior officer in the Vetting Wing which was responsible for security vetting for RAF personnel. He concluded that Mr. Macdonald should not be granted security clearance and made a recommendation to that effect. But he also took the view that it was essential for him to interview Mr. Macdonald to obtain more details of his sexuality and establish whether any other servicemen had been involved with him. He was authorised by his superior officer to proceed in this way.

  46. Mr. Macdonald was interviewed by Wing Commander Leeds on 23 May 1996. In the course of this interview many personal and intrusive questions were put to him about his sexuality, his sexual history, his past sexual relationships and his sexual conduct and activities both within and without the context of his service career. Much of this questioning was designed to elicit from him the names of other service personnel with whom he had been involved in these activities, but he steadfastly refused to be drawn into the position of implicating anyone. Other questions were designed to identify the precise nature of various homosexual acts in which he had engaged. Following this interview Wing Commander Leeds submitted a report to his senior officers in which he recommended that Mr. Macdonald be denied the higher level of security clearance required for his new appointment. He recommended that the basic level of security clearance required of all personnel serving in or working for the RAF should be withdrawn from him also, rendering him unsuitable for service. His recommendation was accepted, and the decision to withdraw Mr. Macdonald's security clearance took effect on 28 March 1997. As a result of the disclosure of his sexual orientation his service in the RAF was terminated on that date.

  47. In the light of this background Mr. Macdonald submitted an application to the employment tribunal in which he claimed that his dismissal was an act of unlawful discrimination against him on the ground of his sex within the meaning of section 1(1) and 2(1) of the Sex Discrimination Act 1975. He also claimed that the circumstances surrounding his dismissal, and in particular the interview to which he was subjected by Wing Commander Leeds on 23 May 1996, constituted unlawful sexual harassment. The employment tribunal held that the Sex Discrimination Act 1975 was concerned only with discrimination on grounds of gender and not with discrimination on grounds of sexual orientation. They also held that the correct comparator for Mr. Macdonald's complaint of less favourable treatment on the ground of his sex was a servicewoman who admitted that she was sexually attracted to women. They found that a servicewoman who admitted her sexual attraction to women would also have been dismissed from the service, so Mr. Macdonald had not been discriminated against on the ground of his sex. They also dismissed his claim of sexual harassment. They found that Wing Commander Leeds had not been sexually motivated in his conduct of the interview, and that he would have conducted it on much the same basis if he had been faced with a homosexual female officer. The Employment Appeal Tribunal differed from the employment tribunal on all three points. They held that the word "sex" in section 1(1)(a) of the 1975 Act should be interpreted as including sexual orientation as well as gender, that the correct comparator as to whether a male homosexual had received less favourable treatment was a female heterosexual so Mr. Macdonald had suffered unlawful discrimination by being forced to resign from the RAF and that he had also suffered sexual harassment at his interview regardless of any comparator because of the sexually-related nature of the questioning.

  48. In the Court of Session all three judges in the Extra Division were agreed that the 1975 Act was concerned with gender and not with sexual orientation. Lord Prosser said that, while any general discussion about or study of "sex" would no doubt cover questions of sexual orientation and not be limited to mere questions of gender, he was quite unable to give the word "sex" in section 1(1)(a) of the Act any other meaning than its familiar and ordinary meaning of "gender": 2001 SC 1, 10, paras 26 and 27; [2002] ICR 174, 184. But the court was divided on the question as to the appropriate comparator. Lord Prosser said that if one was faced with a man wanting or having a partner of a given gender a comparison must be made with a woman having or wanting the same - that is, a partner of that same gender. As Mr. Macdonald was attracted to males, he should be compared with a woman who was attracted by males: pp 14G, 188 E, para 37. Lord Kirkwood and Lord Caplan took the opposite view. As Lord Caplan put it, the fact that Mr. Macdonald may have been inclined to form sexual attachments with members of his own sex in violation of the RAF's policy was the critical circumstance, and inequality of treatment could not be established without reference to the question how a woman would be treated if she too had violated the same policy: pp 21E-G, 196 B-D, para 7.

    THE OVERALL CONTEXT

  49. It was accepted in Ms Pearce's case that the questions which it raises must be answered having regard to the state of the law at the time of the campaign to which she claims to have been subjected at the school between 1991 and 1995. It is common ground also that the question whether Mr. Macdonald was discriminated against unlawfully on the ground of his sex must be addressed by applying the law as it stood on the date of his compulsory dismissal on 28 March 1997. The question which their cases raise is difficult and controversial, but it is right to observe at the outset that the position which confronted homosexuals at the time of these events has now been greatly eased by subsequent developments.

  50. On 2 October 1998 the Human Rights Act 1998 came into force. It was expressly acknowledged during the hearing before the Extra Division in Mr. Macdonald's case that his rights under article 8 of the European Convention for the Protection of Human Rights and Fundamental Freedoms (1953) (Cmnd 8969) taken separately and together with article 14 had been breached: see Lord Prosser, 2001 SC 1, 8, para 17. It follows that he is entitled to a remedy for that breach under article 41 of the Convention. But, for the reasons given by my noble and learned friend, Lord Nicholls of Birkenhead, it is not possible for him to obtain a remedy under the 1998 Act in these proceedings.

  51. On 12 January 2000 the United Kingdom Government announced a change in policy. Homosexuality was no longer seen as incompatible with service in the armed forces, and there was no longer a reason to deny the opportunity of a career in the armed forces to a homosexual: Hansard, HC Debates, 12 January 2000, col 288. That change of policy was rendered inevitable by the decisions of the European Court of Human Rights in Smith v United Kingdom (2000) 29 EHRR 493 and Lustig-Prean v United Kingdom (2000) 29 EHRR 548. In these cases the court held that intrusive questioning into the lives of members of the armed forces suspected of being homosexual, and their discharge on the sole ground of their sexual orientation, constituted a violation of their right to respect for their private lives under article 8 of the Convention in combination with article 14. In SL v Austria (Application No 45330/99), 9 January 2003, para 37 and L&V v Austria (Joined Applications Nos 39392/98 and 39829/98) para 37 the European Court again emphasised that sexual orientation is a concept covered by article 14 and that differences based on sexual orientation require particularly serious reasons by way of justification. It was held that a provision in the Austrian Criminal code which penalised homosexual acts of adult men with consenting adolescents violated article 14 taken in conjunction with article 8.

  52. There have been significant changes too in the way the issue of homosexuality is being treated in Community law. On 1 May 1999 the European Union was established by the Treaty of Amsterdam. Article 6(1) of the Amsterdam Treaty states that the Union "is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law, principles which are common to the Member States." Article 6(a) (now article 13 EC) was inserted into the EC Treaty by the Treaty on European Union: article 7(2) TEU. It gave the EC competence to legislate to combat discrimination based on, among other things, religion or belief, disability, age or sexual orientation. There then followed two important directives. Council Directive 2000/78/EC ("the Framework Directive") requires legislation in respect of discrimination on grounds of religion or belief, disability, age or sexual orientation to be implemented in national law by 2 December 2003. Council Directive 2002/73/EC ("the amended Equal Treatment Directive") requires legislation deeming harassment and sexual harassment within the meaning of that directive to be discrimination on the ground of sex and therefore prohibited to be implemented in national law by 5 October 2005. On 23 October 2002 the draft Employment Equality (Sexual Orientation) Regulations were published by the Department for Trade and Industry. This measure is designed to implement the United Kingdom's obligations under the sexual orientation part of the Framework Directive. Consideration is being given to the legislative changes that will be needed to implement the concepts of harassment related to sex and sexual harassment which are contained in the amended Equal Treatment Directive. Consultation has taken place, with a view to giving companies and public sector organisations time to prepare for their new responsibilities: see the Consultation Papers Towards Equality and Diversity (December 2001), Equality and Diversity: A Way Ahead (October 2002) and Equality and Diversity: Making it Happen (October 2002).

  53. As Mr. O'Neill QC for Mr. Macdonald was right to explain to your Lordships, these developments have in no way reduced the importance of this case to the appellants. They do however make it clear that their cases have been, through no fault of their own, caught up in a time warp whose consequences have only now been completely discredited. It has to be stressed also that we are dealing here with an area of the law which is entirely the creature of statute. The sole purpose of the 1975 Act, as its long title indicates, was to render certain kinds of sex discrimination unlawful. It was not designed to deal with discrimination on other grounds, however reprehensible.

  54. We can, of course, have regard to the treaty obligations of the United Kingdom in seeking to resolve an ambiguity in the meaning of the statute: R v Secretary of State for the Home Department, Ex p Brind [1991] 1 AC 696, 747G-748E per Lord Bridge of Harwich; T, Petitioner 1997 SLT 724, 733. But the precise way in which the 1975 Act is framed leaves very little room for judicial reform and development of the kind which was possible in the law relating to adoption in T, Petitioner and in the interpretation of the expression "a member of the original tenant's family" in Schedule 1, para 3 of the Rent Act 1977 in Fitzpatrick v Sterling Housing Association Ltd [2001] 1 AC 27. Counsel for the appellants accepted that it was not open to them to rely on the provisions of section 3 of the Human Rights Act 1998, as that section does not enable the meaning which was previously given to primary legislation to be changed retrospectively: R v Lambert [2002] 2 AC 545; 604 para 142 per Lord Clyde; R v Kansal (No 2) [2002] 2 AC 69, para 83. Although directives have now been promulgated, following the insertion by the Treaty of Amsterdam of what is now article 13 EC into the EC Treaty, to deal with discrimination on the ground of sexual orientation (Council Directive 2000/78/EC) and with sexual harassment (Council Directive 2002/73/EC), they will not have direct effect under article 249 EC until the end of the period fixed for their implementation: Pubblico Ministero v Ratti (Case 148/78) [1979] ECR 1629, para 24; Richard Brent, Directives: Rights and Remedies in English and Community Law (2001), 15.02.

  55. If there were indications a different approach had already been taken in Community law, we would be bound to follow it. This is because the Sex Discrimination 1975 gave effect in domestic law to Council Directive 76/207/EEC ("the Equal Treatment Directive"). Article 3(1) of that Directive states that application of the principle of equal treatment means that there shall be no discrimination whatsoever on grounds of sex as regards access to employment and working conditions. In Webb v EMO Air Cargo (UK) Ltd [1994] ECR I-03567, para 26, dealing with the position of pregnant women, the European Court of Justice rejected an interpretation of the Directive that would have rendered its provisions ineffective. And the court has repeatedly held that the right not to be discriminated against on grounds of sex is one of the fundamental human rights whose observance it has a duty to ensure: see P v S & Cornwall County Council [1996] ECR I-2143, para 17. In that case the court held that the scope of the Directive applied also to discrimination arising from gender reassignment. The question is whether the Directive has been held to apply also to discrimination arising from sexual orientation.

  56. In Grant v South-West Trains Ltd [1998] IRLR 206, the European Court held that the refusal of travel concessions to a male worker living with a person of the same sex, just as they were to a female worker living with a person of the same sex, could not be regarded as constituting discrimination directly based on sex contrary to the Equal Pay Directive: paras 27, 28. It rejected the submission, noted in para 37, that differences of treatment based on sexual orientation were included in the 'discrimination based on sex' prohibited by article 119 of the EC Treaty (now article 147 EC). In para 47 the court said:

    Such an observation, which does not in any event appear to reflect the interpretation so far generally accepted of the concept of discrimination based on sex which appears in various international instruments concerning the protection of fundamental rights, cannot in any case constitute a basis for the court to extend the scope of article 119 of the Treaty. That being so, the scope of that article, as of any provision of Community law, is to be determined only by having regard to its wording and purpose, its place in the scheme of the Treaty and its legal context. It follows from the considerations set out above that Community law as it stands at present does not cover discrimination based on sexual orientation, such as that in issue in the main proceedings.

  57. It is plain from this passage that the court does not see the word "sex" in that article as extending to sexual orientation: see also D v Kingdom of Sweden [2001] ECR I-04319, paras 45-47. So there is no basis in Community law for extending the meaning of any of the provisions of the 1975 Act to cover discrimination on this ground. In R v Ministry of Defence, Ex p Smith [1996] QB 517, 560-561 Sir Thomas Bingham MR. said that he had found nothing whatever in the EEC Treaty or in the Equal Treatment Directive which suggested that the draftsmen of these instruments were addressing their minds in any way to problems of discrimination on the grounds of sexual orientation. It was no doubt for this reason that the Commission thought that it was necessary, following the amendment of Treaty in Amsterdam, to deal with this matter by means of Council Directives 2000/78/EC and 2002/73/EC.

  58. So we must take the 1975 Act as we find it. As Mr. Sales said at the outset of his submissions in Ms Pearce's case, it is an unfortunate fact that human beings discriminate each other all the time. But this is unlawful only when the law proscribes such conduct. All we can do is apply to the facts the ordinary and natural meaning of the words which Parliament used when it was describing the circumstances in which the statutory remedy was to be available. There is no escape from the conclusion that the lack of insight into homosexuality which was current when the statutory framework within which the appellants' cases lie was being laid down casts a shadow over these proceedings which is not capable of being lifted by the more recent developments.

    THE ISSUES IN MR. MACDONALD'S CASE

  59. Mr. O'Neill made it clear in the course of his submissions in Mr. Macdonald's case that the meaning of the word "sex" in section 1(1)(a) of the 1975 Act was no longer in dispute. He accepted that it means simply "gender". I think that he was right to make this concession, especially in the light of the position which has been adopted by the European Court. In my opinion it is clear that this is the ordinary meaning of the word in this context. As Simon Brown LJ said in R v Ministry of Defence, Ex p Smith [1996] QB 517, 543, the ordinary and natural meaning of the word "sex" in this context is gender. In Smith v Gardner Merchant Ltd [1999] ICR 134 it was conceded that this was so. Judge LJ was plainly right when he said in Ms Pearce's case that the 1975 Act does not address "sexual orientation" and that words which might possibly have that meaning, or which might be regarded as illustrative of or broad enough to encompass this concept, are absent from it: [2002] ICR 198. The express purpose of the Act is to eliminate "certain kinds" of sex discrimination. As a discrete ground "sexual orientation" is not included.

  60. But Mr. O'Neill submitted that the treatment which Mr. Macdonald suffered can nevertheless be analysed as discrimination on the ground of his sex. As he put it, the question is whether there is an overlap between the concepts of gender and sexual orientation, given that they are different. Having maintained that there was such an overlap, he said that the critical issues in his case were directed to the phrase "the relevant circumstances" in section 5(3) and to the selection of the characteristics of the appropriate comparator. The proposition for which he contended was that in order to compare like with like, where the man was attracted to another man, the woman who was selected as the comparator had to be a woman who was attracted to a man also. As for the complaint of sexual harassment arising from the intrusive interview, he said that this was so blatantly male-orientated that there was no need to resort to a comparison. It was plain that this was an act of unlawful discrimination on the ground of Macdonald's sex.

    THE SCOPE OF THE ACT

  61. The fact that it is now agreed that the word "sex" in section 1(1)(a) has no meaning in this context other than gender has important consequences. It has a direct bearing on the choice of the comparator. If the word was to be taken to include sexual orientation as well as gender, it would have been enough for Mr. Macdonald to show that the treatment which he received from the RAF on the ground of his homosexuality was less favourable than the way a heterosexual man would have been treated by the armed services. On the given facts his case would then have been unanswerable. The only characteristic that would have had to be changed in order to identify the appropriate comparator would have been the characteristic which made it unlawful for his employer to discriminate against him. There would have been no need to change the gender of the comparator, as gender was not the critical issue in his case. The only change needed would have been as to the sexual orientation of the comparator. The comparison of his case with a heterosexual man would have led directly to the conclusion that implementation of the armed forces' policy against homosexuals because of their sexual orientation had discriminated against him in a way that was unlawful.

  62. As it is, the fact that the policy was directed against homosexuals because of their sexual orientation and not because of their gender has the effect of driving the argument in his case a different direction. The fact that the policy applied to all service personnel irrespective of their gender, with the result that homosexual men and women were treated equally, removes from the case another possible ground on which it might have been said that there was unlawful discrimination on the ground of the person's sex. Differences between the treatment of men and women in the implementation of that policy might have justified a claim that there was discrimination on the ground of the person's sex, but that it not this case. The evidence is that the policy applied to men and women in the same way. The fact that homosexual men and women were both treated in the same way does not, of course, exclude the possibility that they were nevertheless discriminated against on the ground of their sex. But the argument that this was so becomes much more difficult. If it is to succeed, Mr. Macdonald must be able to show that the appropriate comparator against whom his case that he was treated unfairly on the ground of his sex was a woman whose sexual orientation was different from his. He has to show that his case is to be compared not just with that of a woman but with a woman who was a heterosexual.

    THE COMPARATOR

  63. The argument that the appropriate comparator is a heterosexual woman was examined by David Pannick, Sex Discrimination Law (1975), p 210-211. As he pointed out, one's conclusion on the validity of the claim depends on the classification of the problem and the precise comparison one adopts. He suggested that the complainant could argue that an employer who dismissed a male homosexual from his employment because he had a rule that he would employ neither men nor women who had sexual preferences for their own sex had discriminated against them because he was treating differently two employees, one male and one female, who were sexually attached to the same actual or hypothetical male employee. The problem, he said, was that the 1975 Act provided no criterion of relevance.

  64. I do not, with respect, accept that the 1975 Act provides no criterion by reference to which one may judge the relevance of the circumstances used to identify the appropriate comparator. Section 5(3) states that a comparison of the cases of persons of different sex must be such that the relevant circumstances in the one case are the same, or not materially different, in the other. It envisages only one comparator. The sex of the comparator must, of course, be different. But, if the relevant circumstances are to be same or not materially different, all characteristics of the complainant which are relevant to the way his case was dealt with must be found also in the comparator. They do not have to be precisely the same. But they must not be materially different.

  65. What then is the test which one must apply in order to judge what is relevant and what is material? The answer lies in the context which is set for this exercise by the words used in section 1(1)(a). As Lord Goff of Chieveley put it in James v Eastleigh Borough Council [1990] 2 AC 751, 774C-D, the issue is whether the complainant would have received the same treatment from the employer "but for her sex". A person discriminates against a woman unlawfully on this ground if he treats her less favourably than he treats or would treat a man. If one is applying this test (the "but for" test), one can ignore circumstances which have no bearing at all on the way the woman was treated. If the treatment related entirely to things done at the workplace, for example, one can ignore things which the comparator does at home. But one cannot ignore things which have a direct bearing on, or are used to explain why, the woman was treated differently from a man. As Lord Caplan put it, the critical circumstance is the circumstance which led the employer to treat the woman differently. If this was because the woman was left handed, for example, the same characteristic must be found in the comparator. A right handed man would not be an appropriate comparator. This is because section 5(3) tells us that the relevant circumstances must be the same. That is the basic rule, if one is to compare like with like. One can ignore characteristics that have no bearing on the way the woman was treated. But those that do have a bearing on the way she was treated must be the same if one is to determine whether, but for her sex, she would have been treated differently.

  66. This reasoning suggests that there is no escape from the conclusion that the appropriate comparator where the reason for the treatment was the woman's homosexuality is a man who shares the same distinct characteristic - a man who like her is a homosexual. All one has to do where a man is the claimant is reverse the genders. The characteristic of homosexuality, which is the critical circumstance, remains the same. Of course, this proposition invites the objection that, as soon as that choice is made, it defeats the argument that the claimant was discriminated against on the ground of his sex. It has been described as the equal misery rule, because it will usually mean that homosexuals of either sex are left without a remedy. But it is the fact that it is discrimination on the ground of sex, and of sex only, that the 1975 Act makes unlawful that creates the misery, not the choice of the comparator. Until the Disability Discrimination Act 1995 was enacted, for example, there was no protection against discrimination on the ground of a person's disability. It could be said that all disabled persons were in a state of equal misery because there was no statutory protection against discrimination against them unless could be shown that they were treated differently on the ground of their sex contrary to the 1975 Act or on racial grounds contrary to the Race Relations Act 1976. They had no protection if they were discriminated against on the ground only of their disability. The flaw lies in the piecemeal way in which the legislation has approached the problem of inequality.

    THE COMPETING ARGUMENTS

  67. The issue is too important however to arrive at a decision on this point without considering the competing arguments in more detail.

  68. The principal argument against the view that in a case of sexual orientation the appropriate comparator is a person who, like the claimant, is also a homosexual is that which Dr Robert Wintermute advanced in his article "Recognising New Kinds of Direct Sex Discrimination: Transexualism, Sexual Orientation and Dress Codes" [1997] 60 MLR 334; see also Lesbian & Gay Inequality 2000: the Potential of the Human Rights Act 1998 and the Need for an Equality Act 2002: [2002] EHRLR 603. In Mr. Macdonald's case Lord Prosser agreed with his reasoning: 2001 SC 1, 12, paras 32-33. In Smith v Gardner Merchant Ltd [1999] ICR 134, 149 Ward LJ rejected it. In Ms Pearce's case [2002] ICR 198 Hale LJ, in a powerfully argued judgment, made clear her regret at being driven to the same conclusion as that reached by the majority in Smith v Gardner Merchant Ltd because the decision in that case was binding upon her. As she acknowledged at p 203, para 7, the source of the argument which she favoured was Dr Wintemute. So it is worth setting out in full the relevant passage in his article.

  69. What Dr Wintemute said was this [1997] 60 MLR 332, 347:

    If a man complains that he has been treated differently because he has a male partner, the usual response is that there is no direct sex discrimination because a woman who has a female partner would be treated in the same way. This comparison avoids a finding of direct sex discrimination by changing not only the sex of the man, but also the sex of his partner. Yet for a valid sex discrimination analysis, the comparison must change only the sex of the complaining individual, and must hold all other circumstances constant. Otherwise a change in some other circumstance (such as the complaining individual's qualifications, their choice of job or the sex of their partner) could hide the sex discrimination. If an employer refused to hire a woman with the required university degree, her comparator would not be a man without the required university degree. She would reply: 'I have the required degree. You have changed both my sex and my qualifications. Change only my sex and compare me with a man with the required degree.' If a man wanting to be a nurse challenged a rule that only women could be nurses and only men could be doctors, his comparator would not be a woman wanting to be a doctor. He would reply: 'I don't want to be a doctor. I want to be a nurse. You have changed both my sex and my choice of job. Change only my sex and compare me with a woman wanting to be a nurse.' Similarly, a man with a male partner compared with a woman with a male partner would reply: 'My partner is male not female. You have changed both my sex and the sex of my partner. Change only my sex and compare me with a woman with a male partner.' If the sex of the man is changed, but the sex of his male partner is held constant, the man's comparator is a woman with a male partner and the direct sex discrimination is clear. If the sexes of both the man and his partner are changed, the man's comparator becomes a woman with a female partner and the direct discrimination disappears with a wave of the magician's wand.

  70. There is much in this passage with which I agree. I agree that, for a valid sex discrimination analysis, the comparison must change only the sex of the complaining individual and must hold all the other circumstances constant. The objections to the employer's choice of the comparator which it attributes to the woman with the required university degree and to the man wanting to be nurse make perfect sense. They are matched by the example which I gave in para 21 of the left handed woman. But the key to the whole argument is Dr Wintemute's proposition that, in the example which he gives of the man with a male partner, the correct thing to do is to change the sex of the man only and not that of his partner. What this does, in effect, is to break the rule which he himself has recognised, namely that for a valid sex discrimination analysis the comparison must change only the sex of the complaining individual. It does not only change the sex of the complaining individual. It changes his sexual orientation too. The woman with whom his case is compared is a woman with a different sexual orientation from his. She is attracted to persons of the opposite sex, while he is attracted to persons of the same sex. So analysed, the proposition breaks the rule which section 5(3) lays down that the cases of the man and the woman must be the same.

  71. Dr Wintemute seeks to avoid this breach by diverting attention from the comparator to the comparator's partner. There may, of course, be cases where the reason why a male claimant has been treated differently is indeed because of his attachment to a particular man and not because of his sexual orientation generally. But that is not what the argument is really about, and it is certainly not so in the cases of Mr. Macdonald and Ms Pearce. At the time of Mr. Macdonald's dismissal paragraph 1032(1) of the Queen's Regulations stated: "Homosexuality, whether male or female, is considered incompatible with service in the Armed Forces." The effect of this statement was that the gender of the individual was irrelevant. The policy applied equally to either sex. If one is driven to accept that the reason why the man was treated differently was that he was sexually attracted to members of the same sex, as we are in Mr. Macdonald' case by the terms of the armed forces' policy, one must attribute the same characteristic to the comparator. It was not the fact that he had a particular partner that led to Mr. Macdonald's dismissal. It was the fact that he admitted to the interviewing officer that he was a homosexual. I do not see how, as Hale LJ suggested in Ms Pearce's case [2002] ICR 198, 208, para 22, one can reject the claimant's sexual orientation as irrelevant for the purpose of identifying the comparator. Mr. Macdonald's sexual orientation was the critical factor in this case that led to his being dismissed. In Ms Pearce's case it was the critical factor that led to the abuse which she received, both in words and behaviour. Their sexual orientation was plainly one of relevant circumstances which, if the rule laid down by section 5(3) is followed, must be same in the case of their comparators. That was the view taken by Judge LJ in Ms Pearce's case at p 216, para 55, and Henry LJ did not offer any support for the approach suggested by Hale LJ.

  72. In Smith v Gardner Merchant Ltd [1999] ICR 134, 158-159 Beldam LJ said that the use of the catch phrase "compare like with like" might in some cases disguise the need to inquire whether a circumstance really is relevant to the conduct complained of in a particular case. He said that in the circumstances of that case, which was a case of sexual harassment, it was as irrelevant to consider the sexual orientation of the victim as it was in Porcelli v Strathclyde Regional Council [1986] ICR 564 (reported in the Session Cases as Strathclyde Regional Council v Porcelli 1986 SC 137) to consider whether the employees in that case would have similarly treated a man whom they disliked. He explained the approach which he favoured in this way at p158:

    In the case of a male victim, the question is whether he was treated in the way he was because he was male, not because he was a male with a particular sexual inclination. Nor in deciding that question is it a material consideration that a female with similar or any other sexual inclinations would have been treated in the same way if she would not, as a female, have been so treated in any circumstances.

  73. The advice which Beldam LJ gave in this passage that one must always be careful to inquire whether a circumstance really is relevant to the conduct complained of is valuable. It is, of course, important to ask in the case of a male claimant whether he was treated in the way he was because he was male. I shall have more to say about the way the question of the comparator was treated in Strathclyde Regional Council v Porcelli 1986 SC 137 when I come to examine the issue of sexual harassment. But the findings in that case made it clear that the campaign to which the claimant was subjected included significant elements of a sexual character to which a man would not have been vulnerable. Lord President Emslie said at p 145 that, although the campaign as a whole had no sex related motive or object, the particular part of it which was in issue in that case was a particular kind of weapon based upon the sex of the victim which would not have been used against an equally disliked man. The question of sexual orientation was absent from that case. The only issue was whether it was a case of discrimination on the ground of the claimant's sex.

  74. But I do not agree with the way in which the counter argument was put by Beldam LJ. It is not right to say that one is asking oneself whether the male claimant was treated as he was because he was a male with a particular sexual inclination. This is Mr. O'Neill's point that the two concepts overlap, which in the context of this legislation I would reject. The question is whether the man was treated as he was because he was male or whether he was treated as he was because of his sexual inclination. If the facts show that men and women with the same sexual inclination would have been treated in the same way but that men and women with a different sexual inclination would have been treated differently, the only conclusion that one can draw is that the reason for the difference was not the sex of the claimant but his sexual inclination.

  75. In Smith v Gardner Merchant Ltd [1999] ICR 134 p 159, Beldam LJ went on to say this:

    I think the argument directed to the sexual inclinations of an employee of the opposite sex is misplaced and irrelevant. Moreover, it being conceded that discriminatory treatment of a person on grounds of sexual orientation does not amount to discrimination on ground of sex, I do not see how the sexual orientation of the victim is to be regarded as a relevant circumstance and, if it is not relevant in the case of the victim, it cannot be relevant in the case of the person of the opposite sex with whom comparison is made.

  76. This passage was approved and adopted by Lord Prosser in Mr. Macdonald's case: 2001 SC 1, 13, para 33; [2002] ICR 174, 186. Developing the same theme, he explained his understanding of the point in this way in para 34, p 187:

    I think that it is worth noting that apart from statute, a number of different comparisons will be possible in any one case, with no one comparison being the only or 'right' one. Thus, the fact that a homosexual person of either sex is perhaps being treated unfairly by comparison with a heterosexual person of either sex, in the context of a basic categorisation by orientation rather than by gender, does not exclude the possibility that in the context of the other basic categorisation, by gender, there may also be discrimination, on the ground of gender, in the same factual circumstances.

    At p 14, para 37, p 188 he said that, if one was faced with a man wanting or having a partner of a given gender, a comparison must be with a woman having or wanting the same - a partner of the same gender. Although he did not think that it was relevant to consider the person's general wishes or conduct, the position if one took that route was the same:

    Such general wishes or conduct - or 'orientation' if one is to use that word - consist in being attracted sexually by people of one gender or another. Mr. Macdonald is attracted by males. He should be compared with a woman who is attracted by males. I see no basis for departing from this simple comparison in favour of one which builds in no new fact, but treats as crucial what in my view is merely a comment on orientation, as revealed by these same facts.

  77. It seems to me however that this simple approach, as Lord Prosser described it, suffers from the same problem as that recommended by Dr Wintemute. The proposition that Mr. Macdonald, who is attracted by males, should be compared with a woman who is attracted by males involves changing not only the sex of the comparator but also her sexual orientation. One cannot avoid the issue by saying that, as sexual orientation consists in being attracted by one gender or the other, to describe him as a homosexual is merely a comment on his orientation which can be dismissed as irrelevant as it adds no new fact. The search is for a comparator whose circumstances are the same as those of the claimant except for his sex. The comparator's circumstances are not the same as that of the homosexual if her sexual orientation is towards persons of the opposite sex.

  78. While I would reject the approach to this problem which was favoured by Beldam LJ and by Lord Prosser, there is another possible approach that might be taken to it which has some attraction. The argument can be expressed in this way. Mr. Macdonald's case is plainly about his sexual orientation. But the prohibition which was applied to him under the armed forces' policy against being sexually attracted to men was also based on his gender. This is because women were not being subjected to the same prohibition. In their case an attraction to men was permitted. This was a prohibition about the appellant's sexual conduct which proscribed conduct that was generally accepted if engaged in by women. The fact that the prohibition was really about gender and not sexual orientation can be seen, it might be argued, from the fact that it is not until one has identified the gender of the person who is attracted by men that one can say whether or not the policy is being breached. An anonymous advertisement for a male partner may or may not breach it. Whether it does or not depends on the gender of the person who placed the advertisement.

  79. But I think that the answer to this further argument is that it all depends on the facts, and I would analyse the facts of Mr. Macdonald's case in this way. We have to begin by identifying the sex or gender of the claimant, as his case is that he was discriminated on this ground. We know that Mr. Macdonald is a man. Then we have the policy which led to his dismissal and his complaint of sexual harassment. Homosexuality, whether male or female, was considered incompatible with service in the armed forces. This is the explanation which is offered for his treatment. The way in which the policy was expressed shows that, while gender was relevant to its application in practice, it was in terms a policy about sexual orientation. So the case cannot be treated as one where the treatment which the complainant received was self-evidently discriminatory on the grounds of sex. To see whether it was in fact on the ground of sex and not on the ground of sexual orientation one must resort to the process of comparison.

  80. Then it was said that the same approach should be taken to this process as that which is taken in cases of racial discrimination under section 1(1)(a) of the Race Relations Act 1976. Typical examples of such cases are where a white person is refused entry to a restaurant on the ground that he has a black person with him, or a black person is refused entry because he is in the company of a white person. Section 3(3) of the 1976 Act provides that a comparison of the case of a person of a particular racial group with that of a person not of that group must be such that the relevant circumstances in the one case must be the same, or not materially different, in the other. The wording of this provision is the same, mutatis mutandis, as that of section 5(3) of the Sex Discrimination Act 1975. But in a racial discrimination case of the type mentioned it is the racial characteristic of the third party that is usually the decisive factor. This because a black person who was with a black person, or a white person who was with a white person, would be likely to be treated in the same way.

  81. Similarly, in Smyth v Croft Inns Ltd [1996] IRLR 84, para 28, which was a case of discrimination on the ground of religious belief in Northern Ireland where the respondent was dismissed from his position as a barman in a pub in a loyalist area of Belfast where the customers were Protestants because he was a Roman Catholic, Hutton LCJ said that the relevant comparator was a Protestant barman who would not have been threatened because of his religious beliefs. He added that the employer's case could not cease to be unlawful discrimination if, instead of owning only one bar patronised by Protestants, he also owned a second bar in a Roman Catholic neighbourhood, patronised by Roman Catholics, in which he dismissed a Protestant barman. Here too it is plain that the relevant circumstances included the religious beliefs of the customers as well as those of the dismissed barmen. If this is so, it is asked, why should account not be taken of the sexual orientation of the person to whom the claimant and the comparator are both attracted?

  82. As the Advocate General in Mr. Macdonald's case pointed out, there is a difference in wording between section 1(1)(a) of the race Relations Act 1975, which refers to discrimination "on racial grounds", and section 1(1)(c) of the Sex Discrimination Act 1975, which refers to discrimination against a woman "on the ground of her sex". The reach of the 1976 Act is wider, as can be seen from Weathersfield v Sargent [1999] ICR 425 where it was held that the applicant who had been dismissed for refusing to implement a racially discriminatory trading policy had been discriminated against on racial grounds. It is necessary to give full weight to the words used in the subsection, as Lord Simon of Glaisdale said in Race Relations Board v Applin [1975] AC 259, 289. If this is not done, conduct which is plainly within the mischief would escape. The same may be said of section 16(1)(a) of the Fair Employment (Northern Ireland) Act 1976, as amended by the Fair Employment (Northern Ireland) Act 1989, which refers to discrimination "on the ground of religious belief or political opinion." But this is not a wholly satisfactory answer to the question. The better answer, I think, is that there is no fixed rule that the characteristics of the third party must be taken into account or must be regarded as irrelevant. It is necessary to form a judgment as to what is relevant in the light of the facts of each case, bearing in mind the wording of the relevant subsection which declares the kind of discrimination which is in issue to be unlawful.

    MAKING THE COMPARISON

  83. Mr. Macdonald has admitted to being a homosexual. His known characteristics are therefore that he is male and that he is homosexual. The question is whether the treatment which he received was less favourable than that which a woman would have received in the same circumstances, applying the rule which section 5(3) lays down. One must change the gender when the rule is applied. But, as the policy was about sexual orientation, one can only discover whether this was truly a case of discrimination on the ground of gender by comparing his case with that of a woman who shares with him the characteristic of homosexuality. If she would have been treated more favourably, then one can of course conclude that this is a case of discrimination on the grounds of sex. But if she would have been treated in just the same way, and if heterosexuals would have been treated more favourably, one is driven to conclude that the critical fact in Mr. Macdonald's case was his sexual orientation and not his gender. That is the conclusion which I would draw in his case.

  84. I would analyse Ms Pearce's case in the same way. She is a woman, and it became known in the school that she is a lesbian. These are the relevant characteristics in her case. From about 1991 to May 1995 she was subjected to verbal abuse by pupils who used language which identified her as a lesbian. Her complaint against her employers is that this was a detriment, and that in subjecting her to it they discriminated against her on the ground of her gender. The question is whether the treatment which she received was less favourable than a man would have received in the same circumstances, applying the rule in section 5(3). Here again one must change the gender in order to see whether this was indeed discrimination on the ground of her sex. But the other characteristic, which was relevant to the way the pupils treated her, must remain the same. So the treatment which she received must be compared with that which would have been received by a male homosexual. It is plain from the findings of the employment tribunal that the school would not have treated a male homosexual teacher who had been subjected to homophobic abuse by his pupils any differently. These findings lead to the inevitable conclusion that, while it is plain that she was harassed and humiliated, she was not discriminated against on the ground of her sex.

  85. The employment tribunal said that the incident of 1 March 1995, when several boys called out "pussy", there were comments about the smell of fish and cat food and Ms Pearce later found an opened can of cat food and half its contents in her coat pocket, was quite different from those which had concentrated on her sexuality as it was directed to a woman and a woman's anatomy and not to woman who was lesbian. But this incident has to be seen in its context. Ms Pearce had just returned to work after a period of sick leave after becoming ill with stress. This followed various incidents in September and October 1994 which were all homophobic in nature. There then followed a further series of incidents from March to May 1995, all of which were of the same character. The incident of 1 March 1995 was, as Miss Booth QC submitted, gender-specific but none the less homophobic in character. The Employment Appeal Tribunal were persuaded that there were no grounds for treating this incident differently from the others [2000] ICR 920, 932, para 12, and I think that they were right.

    SEXUAL HARASSMENT

  86. Section 4(1) of the Sex Discrimination Act 1975 identifies victimisation as a distinct category of discrimination. The Act does not accord the same treatment to sexual harassment. If this occurs in the field of employment it is a "detriment" within the meaning of section 6(2), as Lord President Emslie said in Strathclyde Regional Council v Porcelli 1986 SC 137, 144-145; [1986] ICR 564, 568. It is not made unlawful by the Act unless the employer discriminates against the person whom he subjects to it by treating her less favourably than he would treat a man or, if the victim is a man, than he would treat a woman. But it has been suggested that sexual harassment is so plainly discriminatory that there is no need to look for a comparator. This is because the essence of this form of humiliating or degrading treatment is that it selects as its target the victim's gender. The acts or words are gender-specific. So it speaks for itself, it is said, and the search for a comparator is unnecessary. This approach has the obvious advantage of avoiding the difficulty with which I have just been dealing when making the comparison which confronts homosexuals. That is the difficulty which is inherent in using the principle of equal treatment to combat harassment where the conduct in question is equally offensive to members of both sexes: Deakin & Morris, Labour Law 3rd ed, (2001) p 598. But is the approach compatible with the test for discrimination on the ground of sex which has been laid down by the Act?

  87. The point arises in Mr. Macdonald's case with respect to the interview to which Wing Commander Leeds subjected him. His complaint is that he was interrogated in unnecessarily explicit detail about his past sexual activities and that its effect was to subject him to unwanted, unreasonable and offensive conduct of a sexual nature such as to constitute sexual harassment. The employment tribunal said that they had no doubt that if he had been faced with a homosexual female officer Wing Commander Leeds would have conducted the interview on very much the same lines, as to do so was what he perceived to be his responsibility as a vetting officer. As the complaint fell to be dismissed because it failed in the application of the comparator test they did not have to decide whether the conduct was of the quality that was needed to support a finding of sexual harassment, were such a finding competent. The Employment Appeal Tribunal disagreed. The principal ground on which they reversed the decision of the employment tribunal was their interpretation of the word "sex" in section 1(1)(a) of the 1975 Act, which they said should be interpreted to include sexual orientation. But Lord Johnston had this to say about the interview [2001] ICR 1, 13, para 32:

    .... given the tribunal's findings of fact as to the nature of the interview, the test laid down in Porcelli v Strathclyde Regional Council [1986] ICR 564 must apply which confirms that if the nature of the conduct is both sexually related and blatantly unacceptable there is no need for a comparator.

  88. The Employment Appeal Tribunal found that, on the facts found generally proved by the tribunal, Mr. Macdonald was subjected to sexual harassment and that he was also entitled to compensation in that respect. Although Mr. O'Neill no longer seeks to support the decision of the Employment Appeal Tribunal on the interpretation of the word "sex" in section 1(1)(a), he submitted that this finding was sound in law and that Mr. Macdonald was entitled to an award of compensation on the ground of sexual harassment even if he was not entitled to compensation for his dismissal.

  89. In Ms Pearce's case this argument extends to the whole of the conduct to which she claims to have been subjected. It is said that the words that the pupils used when they were harassing her could not have been used of a man, that they were gender-specific and that it follows that this conduct amounted to sexual harassment falling within what was described by Hale LJ in the Court of Appeal as the Porcelli principle: [2002] ICR 198, 204, para 11. Mr. Emmerson referred to the way the argument was put by Morison J in British Telecommunications Plc v Williams [1997] IRLR 668, 669, where he said:

    To affect a person's dignity on the grounds of sex will, as with other forms of sexual harassment, cause a detriment to that person. Thus, proof of sexual harassment, of whatever form, will satisfy the criterion. Because the conduct which constitutes sexual harassment is itself gender-specific, there is no necessity to look for a male comparator. Indeed it would be no defence to a complaint of sexual harassment that a person of the other sex would have been similarly so treated: see Porcelli v Strathclyde Regional Council [1986] ICR 564.

    It would, said Mr. Emmerson, be quite illogical if what would plainly be sexual harassment in the case of a heterosexual woman were to be held not to be in the case of a woman who was a lesbian because her case had to be compared with a man who was a homosexual.

  90. The source of this argument seems to be the decision of the Court of Session in Strathclyde Regional Council v Porcelli 1986 SC 137; [1986] ICR 564. Mrs. Porcelli was employed as a science laboratory technician at a school in Glasgow. Two technicians in the same department named Coles and Reid pursued a vindictive campaign against her for the deliberate purpose of making her apply for a transfer to another school. This conduct was both unpleasant and intimidating. It included various obscene acts which had a sexual innuendo, and the industrial tribunal held that it undoubtedly amounted to sexual harassment. There was no suggestion in that case that Mrs. Porcelli was, or was suspected of being, a homosexual. The purpose of the conduct was simply to drive her out of the school, which in the event it did. It was designed to hurt her, and the method that was chosen was to humiliate her by using a particular kind of weapon against her because she was a woman. The tribunal held, with some regret, that had Mrs. Porcelli been a man whom the other technicians disliked as much as they disliked her they would have treated him just as unfavourably as they treated her. So, applying the comparator test, they dismissed her application. The Employment Appeal Tribunal reversed this decision on the ground that the tribunal did not approach the case in the right way. Lord McDonald said at p 140 that what they should have done was to ask themselves

    1. was there sexual harassment, and

    2. if so, was it to the claimant's detriment?

    The reason which he gave for not mentioning the comparator test was that the aspects of the technicians' behaviour towards Mrs. Porcelli which had sexual overtones could have no relevance in their conduct towards a man.

  91. The Court of Session did not overlook the need for a comparison. Lord President Emslie referred to section 5(3) as one of the provisions in the Act which were relevant to Mrs. Porcelli's case. The way in which he dealt with it can be seen from how he summed the matter up in the final paragraph of his opinion at p 146:

    The industrial tribunal reached their decision by finding that Coles' and Reid's treatment of an equally disliked male colleague would have been just as unpleasant. Where they went wrong, however, was in failing to notice that a material part of the campaign against Mrs. Porcelli consisted of 'sexual harassment', a particularly degrading and unacceptable form of treatment which it must be taken to have been the intention of Parliament to restrain. From their 'Reasons' it is to be understood that they were satisfied that this form of treatment - sexual harassment in any form - would not have figured in a campaign by Coles and Reid directed against a man. In this situation the treatment of Mrs. Porcelli fell to be seen as very different in a material respect from that which would have been inflicted on a male colleague, regardless of equality of overall unpleasantness, and that being so it appears to me that upon a proper application of section 1(1)(a) the industrial tribunal ought to have asked themselves whether in that respect Mrs. Porcelli had been treated by Coles (on the ground of her sex) 'less favourably' than he would have treated a man with whom her position fell to be compared. Had they asked themselves that question it is impossible to believe that they would not have answered it in the affirmative.

  92. The key to a proper understanding of this passage is to be found in the fact that the Lord President has identified sexual harassment as a particular form of treatment which was to be distinguished from other forms of unpleasantness. Having done so the application of the comparator test became a formality, because the tribunal's findings indicated that this form of treatment would not have featured in a campaign against a man. But I do not think that he is to be taken as laying down any principle. What he was doing, as he explained at p 144, was examining the question whether the tribunal had correctly applied the provisions of section 1(1)(a) to the facts which it found proved. Lord Brand's observation at p 152 that, if a form of unfavourable treatment is meted out to a woman to which a man would not have been vulnerable, she has been discriminated against within the meaning of section 1(1)(a) reads as if he understood this to be a point of principle. A similar observation is to be found in the opinion of Lord Grieve at p 150, where he suggest that treatment meted out to a woman on the ground of her sex, although less cruel than that accorded to the man, would fall to be regarded as less favourable treatment simply because it was sexually orientated. But that is not how the case appears to have been decided by the Lord President.

  93. In my opinion Morison J read too much into Porcelli when he said in British Telecommunications Plc v Williams [1997] IRLR 668, 669 that it would be no defence to a complaint of sexual harassment that a person of the other sex would have been similarly so treated. It was precisely because the tribunal's reasons showed that they were satisfied that sexual harassment in any form would not have been used in a campaign which Coles and Reid directed against a man that Lord President Emslie felt able to say that if they had asked themselves whether Mrs. Porcelli had been treated less favourably than a man they would have been bound to answer the question in the affirmative. In so far as Lord Grieve and Lord Brand may be taken to have been suggesting that this was not a relevant question where the harassment is sexually orientated, I would disapprove of their observations. I respectfully agree with the way Ward LJ dealt with Porcelli in Smith v Gardner Merchant Ltd [1999] ICR 137, 147-148. As he said, the conclusions in that case were conclusions of fact and Morison J was wrong to elevate them into a principle of law.

  94. There is no escape, then, from the need to resort to a comparison. The words "less favourable treatment" in section 1(1)(a) render this inevitable. It may be that the conduct complained of is so specific to the claimant's gender that there is no need to do more than to ask the question, to which the answer may well be, as Ward LJ put in Smith v Gardner Merchant Ltd [1999] ICR 137, 148, res ipsa loquitur; Deakin & Morris, Labour Law 3rd ed, (2001) p 598, note 6. But that conclusion may be more easily drawn in cases of sexual harassment which do not involve any homophobic element than in cases such as those of Mr. Macdonald and Ms Pearce where the context for the abuse is the abuser's belief that the victim is a homosexual. This is because those who abuse homosexuals tend to pick on them not because of their gender but because they are homosexual. The form which the abuse takes may well be specific to the gender of the person who is being abused, but this is because the terminology which is used to describe homosexuals and the acts which they can perform with each other tend to vary according to the gender of those who are involved in this relationship. That is not to exclude the possibility that an abuser may treat a woman who is a homosexual less favourably than he would treat a male homosexual. That may indeed happen, and an employment tribunal must always be alert to this possibility. But whether this is so will be a question of fact in each case.

  95. The facts as found by the employment tribunal in the cases of Mr. Macdonald and Ms Pearce leave no room for doubt on this issue. In Mr. Macdonald's case the finding is that the interview would have been no less intrusive if it had been a female homosexual officer who was being interviewed. In Ms Pearce's case the finding is that the pupils would not have treated a hypothetical homosexual male teacher more favourably. On these findings they were not discriminated against on the ground of their sex.

    THE EMPLOYER'S LIABILITY FOR SEXUAL HARASSMENT

  96. This was an issue in Ms Pearce's case only. This is because the sexual harassment was perpetrated not by staff at the school where she was working but by pupils. They were third parties for whose acts the school was not vicariously liable. It was contended that the school's liability depended on whether it could be said that it had "subjected" her to this treatment within the meaning of section 6(2)(b) of the 1975 Act. If, as I would hold, she was not discriminated against on the ground of her sex, this question is not one that need be answered. But I should like to say something about it, as it seems to me that a misunderstanding has arisen as to the test that ought to be applied. The issue is an anxious one, as the test in question - the "control" test - has been consistently applied in employment law since it was first formulated. It is particularly important for schools and other educational establishments, in view of the measures which are now being taken to extend protection to homosexuals against discrimination on the ground of their orientation and against sexual harassment. But it affects all cases where the harassment is perpetrated by third parties for whose acts the employer is not vicariously liable under section 41 of the 1975 Act or, in race relations cases, section 32 of the Race Relations Act 1976.

  97. The employment tribunal based their decision on this part of the case on the control test which was formulated by the Employment Appeal Tribunal in its reasons for its decision in Burton v De Vere Hotels Ltd [1997] ICR 1. The claimants in that case, who were both black, were held to have been subjected to racial harassment by their employers when the speaker at a dinner in the hotel where they were employed made racially offensive remarks about them as they were clearing tables during his performance. The employment tribunal held that their employers had not discriminated against them contrary to the Race Relations Act 1976. Its finding were that, although the hotel manager was aware of the offensive nature of the speaker's act, he simply did not address his mind to what might happen vis--vis the applicants that night and that had he addressed his mind to the risk before the event he would have taken steps to protect them. The implication of these findings was that, if he had addressed his mind to this risk, he would have treated white waitresses who were exposed to the risk of offensive conduct in the same way. In other words, he did not discriminate against the applicants on racial grounds. The tribunal had no doubt that they suffered a detriment that night within the meaning of the Act. But it was not their employers who subjected them to it: [1997] ICR 1, 5D-6D.

  98. The Employment Appeal Tribunal held that there was an error of law in this decision. This was on the view that by imposing upon the applicants the burden of showing that there was different treatment on racial grounds the employment tribunal had imposed on them a burden which was additional to that imposed by the Act, namely the burden of showing that the employers were themselves affected by racial bias or animus: [1997] ICR 1, 6H-7C. But the employment tribunal was doing no more than the Act itself requires: see section 1(1)(a) of the 1976 Act. There was no additional burden. The question for the employment tribunal was simply whether, on racial grounds, the applicants were treated by their employers less favourably than they treated, or would have treated, other employees. It appears that the Employment Appeal Tribunal's view that the tribunal imposed an additional burden was based on a concession, which was itself based on a misunderstanding of Strathclyde Regional Council v Porcelli 1986 SC 137; [1986] ICR 564, that where the treatment under consideration is "race specific" there is no need for the employee to show that the employer himself would have treated a white person differently: [1997] ICR 1, 6H. The effect of the concession was to divert the Employment Appeal Tribunal from the question whether the employers treated the applicants less favourably that they would have treated other persons in comparable circumstances. I agree with my noble and learned friend Lord Nicholls of Birkenhead that Burton was wrongly decided.

  99. Smith J said that the question in the Burton case was what was meant by "subjecting" in section 4(2)(c) of the Act, and that an employer "subjects" an employee to the detriment of racial harassment if he causes or permits the racial harassment to occur in circumstances in which he can "control" whether it happens or not [1997] ICR 1, 7C-E. She said that the tribunal should ask themselves whether the event in question was something which was sufficiently under the control of the employer that he could by the application of "good employment practice" have prevented the harassment or reduced the effect of it: pp 9H-10B. But this approach is not based on anything which is to be found in the statute. I agree that it should now be disapproved.

  100. The problems that the Burton "control" test and the concept of "good employment practice" which it involves may give rise to are well illustrated by what happened in Ms Pearce's case.

  101. The employment tribunal said that if they had to make a finding about the abuse which Ms Pearce suffered they would have held that, with the exception of the incident of 1 March 1995 when the school did act properly and promptly and supported Ms Pearce, it did not take appropriate steps and was therefore directly responsible for sex discrimination. But they did not make any findings to the effect that the school was in a position to control or lessen what the pupils were doing to Ms Pearce. Instead they limited their findings to criticism of the school for failing to make it clear that homophobia was unacceptable and for not supporting her with the result that she felt isolated and unsupported. They appear to have misunderstood what Smith J said in the passage which I have quoted. Even if the taking of these steps was desirable, a failure to take them would not make the school liable under the statute if it could not prevent or reduce the extent of what was happening. In the Court of Appeal [2002] ICR 198, 213, para 39 Hale LJ said that the employment tribunal correctly identified the "control" test in Burton and Rhule and that their conclusion that the school could and should have done more to support Ms Pearce "must mean" that had it done so the pupils' treatment of Ms Pearce would have improved. But there were no findings to this effect, as Burton J in the Employment Appeal Tribunal [2000] IRLR 548, 554 para 19 was right to point out.

  102. A finding by the employment tribunal that the steps which could and should have been taken by the school could have prevented or reduced the extent of Ms Pearce's sexual harassment would not have been a mere formality. Burton J in the Employment Appeal Tribunal, p 554, para 20 said that, if the school was to be found liable and other schools were to avoid being held so liable, there must be careful findings of fact, after full investigation, leading to the conclusion that the steps which the school could have taken and failed to take would have prevented or reduced the extent of the discrimination. I agree. And in the Court of Appeal Judge LJ at p 217-218, paras 60-62, with whom Henry LJ agreed at p 224, para 88, drew attention to the very real problems that would arise if one were to apply the test of "control" to educational establishments. As he said, it is difficult to equate the process of education with the sort of "control" that a hotel can exercise over its customers.

  103. This is not to say that Ms Pearce was not entitled to protection against the abuse which she suffered, which was plainly unacceptable. In this respect she was in the same position as any other member of staff. It was the responsibility of the school to face up to the problem of abuse by pupils irrespective of the form in which it might come and against whom it might be directed. Whether the steps which it could have taken to instil the necessary sense of respect and discipline would have been prevented or reduced the extent of the sexual harassment is another matter. I agree with the majority in the Court of Appeal that the employment tribunal failed to address this vital issue, and that their decision on this part of the case cannot be supported. But I also think that the practical difficulties which its approach reveals provides a further reason for departing from the Burton control test.

    CONCLUSION

  104. For these reasons, and for those given by my noble and learned friend, Lord Rodger of Earlsferry with which in all essential respects I agree, I would dismiss these appeals.

    Lord Hobhouse of Woodborough

    My Lords,

  105. Like all of your Lordships, I too would dismiss the appeals in both these cases. My reasons are the same as those expressed in the Opinion of my noble and learned friend Lord Nicholls of Birkenhead. I also agree specifically that Strathclyde v Porcelli [1986] SC 137, British Telecommunications v Williams [1997] IRLR668, Burton v de Vere Hotels Ltd [1996] IRLR 596 and Go Kidz Go v Bourdouane (1996) should be disapproved. Further, I specifically agree with what my noble and learned friend has said on the Human Rights Act point in paragraphs 21 to 24 of his Opinion. In these circumstances I will confine myself to some short observations on points which I believe to be of particular relevance to these and similar cases and are necessary if the same errors of reasoning are to be avoided in future.

  106. The first point is that the statutory law has not stood still during the 27 years since the Sex Discrimination Act 1975 was passed in anticipation of the 1976 Equal Treatment Directive. Confidence in the workability of anti-discrimination laws has increased and Acts have been passed to extend the scope of the legislation and to cover new types of discriminatory conduct. There is now further draft legislation in preparation to give effect to the 2000 and 2002 Directives, where similar developments have occurred. It is a mistake to construe the 1975 Act as if it had been passed within the last few years. It had a limited scope and was so intended. Section 1(1)(a), defining direct discrimination, uses the simple criterion: "A person discriminates against a woman .... if, on the ground of her sex, he treats her less favourably than he treats or would treat a man." Section 5 reinforces this by identifying a woman as a female and a man as a male and, in respect of the comparison required by s.1, by stipulating that the circumstances must be "the same, or not materially different". There has been a tendency by courts to treat the 1975 Act as having made greater strides than it did - that it included sexual orientation - that it independently prohibited sexual harassment. The tendency is understandable since the conduct in question may be every bit as objectionable as that covered by the Act, or even more objectionable. But the tendency is erroneous and has led to further errors.

  107. The second point is that proper regard must be had in construing an Act of Parliament to the words actually used. It is they which define the effect of the legislation. The now abandoned argument that the phrase "on the ground of her sex" can mean "on the ground of her sexual orientation" fails to respect the language of the statute. The two things are not the same. The use of different words give the phrases different meanings. To disregard this simple fact is to fall into the error rightly, and memorably, condemned by Lord Atkin as long ago as 1941: see [1942] AC 245.

  108. The third point is one which has affected the validity of the appellants' arguments both in your Lordships' House and in the courts below. An essential part of the criterion is that the discriminator's treatment of the complainant should have been "on the ground of her sex". The question must be answered: was it on that ground that he treated her less favourably? The distinction between sex and sexual orientation demonstrates the necessity of asking the question. Suppose that an employer advertises a vacancy saying - "the job is suitable for either a man or a woman but anyone who is a homosexual will not be considered". Or, suppose that a personnel manager simply receives a letter which does not disclose the sender's gender but does disclose that he or she is a homosexual, and replies refusing employment. In neither case can the discrimination have been on the ground of sex since the person, in the latter example, did not know the inquirer's sex and, in the former, expressly excluded the relevance of sex. In the case of Mr. Macdonald, the policy being applied to his disadvantage was expressed in the terms: "Homosexuality, whether male or female, is considered incompatible with service in the Armed Forces." (AP 3392 Vol 5, leaflet 107, [emphasis supplied].) For the sake of clarity, the same document also defined homosexuality as being "behaviour characterised by being sexually attracted to members of the same sex". This unequivocally states that the policy is on the grounds of sexual orientation, not on the ground of anyone's sex. Similarly, in the case of Miss Pearce, it was an agreed fact that the school would have treated a male teacher in exactly the same way as it treated her, in other words, her particular sex was immaterial. This is fatal to their respective cases.

  109. These errors have led to further errors of reasoning in relation to the making of the necessary comparison and in the application of s.5(3). The complainant is a homosexual being treated in the same way as any other homosexual would have been treated by the relevant person. The common factor is homosexuality, being attracted to members of the same sex as oneself. The argument of the appellants has attempted to discard the common factor and, by redefining it, construct another in order to contradict it. A homosexual man is not the same as a heterosexual woman and it is surprising that the argument that he was should have persuaded anyone.

  110. The last point I wish to emphasise is the introduction of the phrase "sexual harassment" into the discussion of the 1975 Act. This expression has since become relevant to later legislation and has had its inherent ambiguity resolved by definition as explained by my noble and learned friend Lord Nicholls. But the phrase does not occur in the 1975 Act. The requirement remains that there is conduct of the person in question which treats the complainant, on grounds of her sex, less favourably than that person would have treated a man in the same circumstances. Harassment of any kind is deplorable. But to give rise to a complaint under the 1975 Act it has to be discriminatory and on the ground of her sex. In some situations the bare facts may speak for themselves and admit of only one conclusion, for example a male employer demanding sexual favours from female employees in return for continued employment. But the vast majority of contested cases will not be so straightforward. The harassment may merely be the selection of the most effective weapon by a bully to achieve some non-sexual objective. The comparison test must be satisfied and dicta which state or suggest the contrary are wrong. It is, further, an error to try to use the 1975 Act for the purpose of enforcing ordinary contractual rights. The real complaint of Miss Pearce is that she was not provided with the protection and support which any teacher was (in her submission) entitled to expect from his or her employer. It is not improved by trying to convert it into a claim for sex discrimination. There was no discrimination. The persons harassing her were not her employers but the pupils she had to try and teach. They were harassing her not because of her sex but because of her sexual orientation.

  111. It follows from what I have said that both these claims had to fail and the appeals should be dismissed.

    Lord Scott of Foscote

    My Lords,

  112. I have had the advantage of reading in advance the opinions of my noble and learned friends, Lord Nicholls of Birkenhead, Lord Hope of Craighead and Lord Rodger of Earlsferry, in which the facts of these two cases are so fully set out and the issues so comprehensively analysed that any repetition would be needless. I gratefully adopt their exposition. I agree with my noble and learned friends that for the reasons they have given each of these appeals should be dismissed. The three main issues addressed are, however, so basic and important in determining the correct approach to discrimination cases that I think I should, in brief, express in my own words my conclusions on those issues.

  113. The first issue is whether an allegation of discrimination on the ground of sexual orientation is, ipso facto, an allegation of discrimination on the ground of sex. Dr Robert Wintermute in his article referred to by Lord Hope in paragraph 30 of his opinion has argued that it is. Hale LJ in her judgment in Pearce [2002] ICR 198 agreed with Dr Wintermute's analysis. The argument is, in skeletal form, as follows:

    1. A man who is dismissed from his employment because he is a homosexual is dismissed because he is sexually attracted to men.

    2. A woman who is sexually attracted to men would not have been dismissed.

    3. The man has, therefore, been discriminated against because he is a man i.e. on the ground of sex.

    It is argued that if statements 1 and 2 are correct, the conclusion in 3 must inevitably follow.

  114. The argument is, in my opinion, fallacious. The fallacy, as Lord Nicholls has pointed out, is produced by an unjustifiable re-writing of the reason for the dismissal. A homosexual is a person who is sexually attracted to those of the same sex as himself or herself. In statement 1 the reason for the dismissal is the employee's homosexuality. The reason would apply indiscriminately to men or to women. It is a gender neutral reason. To treat the homosexuality reason as being gender specific is to treat it as something that it is not. The 1975 Act bars gender specific discrimination: discrimination on the ground of sex. It does not address discrimination on the gender neutral ground of sexual orientation.

  115. Accordingly, in my opinion, neither Mr. Macdonald nor Ms Pearce can claim a remedy under the 1975 Act on the ground that he or she has suffered detriment because of his or her sexual orientation.

  116. The second issue relates to sexual harassment. Each of these appellants claims to have been subjected to harassment of a gender specific character. In Mr. Macdonald's case he was asked highly intrusive, in my opinion unnecessarily and unpardonably intrusive, questions about his homosexual activities. In Ms Pearce's case she was subjected by some of the pupils at her school to taunts and insults of a sexually explicit character. I would be prepared to assume that in each case the appellant suffered what could reasonably be described as sexual harassment.

  117. But the 1975 Act is an Act to combat discrimination. It is not an Act to combat harassment. Discrimination must always be of the essence of a complaint under the 1975 Act, or under any of the other anti-discrimination Acts. Discrimination always involves a comparison between the treatment meted out to the complainant and the treatment that would have been meted out to a person in similar circumstances to those of the complainant save that he or she was not a member of the protected class.

  118. So it was not enough for Mr. Macdonald to show that he had been subjected to sexual harassment by the officer who had questioned him about his homosexuality. He needed also to establish that a woman, in the like position to his own i.e. a homosexual officer in the Royal Air Force, would not have been subjected to comparable harassment. The evidence before the employment tribunal failed to do so (see paragraph 47 of Lord Hope's opinion). In short, Mr. Macdonald established that he had suffered sexual harassment but failed to establish that he had suffered sexual discrimination.

  119. Ms Pearce's case, too, stumbles at the same hurdle. I would accept that she established that she had been the victim of sexual harassment. But she accepted that a homosexual male teacher would have suffered comparable taunts and insults (see paragraph 8 of Lord Nicholls' opinion). And, more important, there was no evidence that the school authorities would have acted any differently if comparable complaints had been made by a homosexual male teacher. In short, Ms Pearce failed to prove the all-important discrimination.

  120. The third issue, which is relevant only to Ms Pearce's case, relates to the responsibility of the school for the behaviour of those pupils who had subjected Ms Pearce to the taunts and insults. This is not a case in which the school can be held vicariously liable. Section 41 of the 1975 Act imposes vicarious liability on an employer for things done by an employee or an agent. Pupils, vis--vis their school, are neither.

  121. Burton v De Vere Hotels Ltd [1997] ICR 1 has been taken as authority for the proposition that if an employer could have controlled whether the discriminatory conduct of others took place or not, the employer should be taken to have subjected the victim of the conduct to that conduct. The case involved alleged racial discrimination, not sex discrimination, but there is no difference so far as this point is concerned between the 1975 Act and the Race Relations Act 1976.

  122. In my opinion Burton was wrongly decided. It overlooked the all-important need to establish discrimination. The case involved two black waitresses in whose presence a professional entertainer at the restaurant made a number of racially offensive remarks and sexually offensive innuendoes. The waitresses' employers, the proprietors of the restaurant, did nothing to intervene and put a stop to this offensive performance nor did they withdraw the waitresses from the scene. They were held liable on a complaint made by the waitresses under the 1976 Act. But there was nothing to show that the employers would have behaved any differently if the butts of the entertainer's offensive humour had been white waitresses, or black men, or white men.

  123. These two appeals demonstrate the importance, in my opinion, when dealing with complaints under the 1975 Act and the other anti-discrimination Acts, of keeping in mind that they are intended to combat discrimination. They are anti-discrimination statutes. Absent discrimination, objectionable conduct by employers must be countered by other means than complaints under these Acts.

  124. I would dismiss these appeals.

    Lord Rodger of Earlsferry

    My Lords,

  125. The two appeals before the House raise overlapping issues as to the interpretation and application of sections 1(1)(a) and 5(3) of the Sex Discrimination Act 1975 ("the 1975 Act"). It is therefore convenient to deal with them together. In the form which it took at the relevant times section 1(1)(a) provides:

    A person discriminates against a woman in any circumstances relevant for the purposes of any provision of this Act if

    (a)

    on the ground of her sex he treats her less favourably than he treats or would treat a man ....

    By section 2 the provision also applies in the case of alleged discrimination against a man and is then to be read with the necessary modifications. So far as relevant, section 5(3) provides:

    A comparison of the cases of persons of different sex .... under section 1(1) .... must be such that the relevant circumstances in the one case are the same, or not materially different, in the other.

  126. For the purposes of the appeal from the Extra Division of the Court of Session in Macdonald v Advocate General for Scotland 2002 SC 1; [2002] ICR 174 I gratefully adopt the account of the facts and issues in the speech of my noble and learned friend, Lord Hope of Craighead. I can therefore turn straightaway to the facts and issues in the second appeal.

    PEARCE vs GOVERNING BODY OF MAYFIELD SCHOOL

  127. In 1975 the appellant, Ms Pearce, began work as a science teacher in the inner city comprehensive school in Portsmouth which was managed by the respondent. The school had a roll of about 1500 pupils whose ages ranged initially from 12 to 16 and, from the mid-1990s, from 11 to 16. From about 1991 onwards pupils subjected Ms Pearce to a sustained campaign of verbal abuse. The children shouted out the words "lesbian", "lemon", "lezzie" and "lesbian shit". They also made or shouted out derogatory comments about lesbians. These comments were either directed at Ms Pearce or were in any event made in her presence. She reported the first incident to the deputy head teacher, Mrs. Millard, who thereafter proceeded on the (correct) basis that Ms Pearce was a lesbian.

  128. After the first incident Ms Pearce reported no others until 1992 although her position is that they occurred on a regular basis. In 1992 she reported two incidents in her classroom and four outside of school, one of them involving a group of children gathered outside her house on a Saturday evening. After Ms Pearce reported that incident Mrs. Millard spoke to three named pupils with the result that she had no further problems with them. Although, according to Ms Pearce, verbal abuse continued in the school corridors, she reported no further incidents in 1993. In the spring and summer of 1994 there were incidents involving verbal abuse in the classroom, in school corridors and, on one occasion, from three named boys at a bus stop. Between September and November 1994 there were various incidents at school in which pupils called Ms Pearce a "lesbian" or some variant of that description. On one occasion a pupil asked her if she thought lesbians should be prosecuted. The pupil subsequently apologised. On another occasion a boy challenged Ms Pearce when she reported him for making comments in class about her being a lesbian and asking her whether she was married.

  129. In November 1994 Ms Pearce told Mrs. Millard that she had become ill with stress because the school was not taking effective action to protect and support her. Immediately thereafter, on 23 November 1994, she was absent from school, suffering from depression and stress. On 28 November Ms Pearce complained to Mrs. Millard about two pupils who had verbally abused her before she took sick leave. Following a letter from the Lesbian and Gay Employment Rights organisation Mrs. Millard saw the pupils concerned on 10 January 1995. The day before, Ms Pearce was invited to a meeting with the headmaster. The meeting eventually took place on 30 January 1995. The headmaster had not prepared himself properly and was interested only in Ms Pearce's return to work: he suggested that she should "grit her teeth" and that she could "run away again" if she found it too difficult. He also suggested that the topic of homophobia could be introduced into school assemblies under the discussion of "differences". The headmaster appeared to be unwilling to give a specific undertaking that by a particular date he would have tackled the question of homophobia either in assembly or in any way that was based on the school as a whole.

  130. Ms Pearce returned to work on 27 February 1995 but two days later, on 1 March, pupils in one of her classes repeatedly shouted out the word "pussy" and made comments about the smell of fish and cat food. At the end of the afternoon Ms Pearce found an opened tin of cat food in her jacket pocket. The pupil concerned was punished with a five-day exclusion and no further incidents of that kind occurred. There were incidents of verbal abuse in school classes, corridors and on the sports ground during March, April and May. Ms Pearce felt isolated and unsupported. On 16 May 1995 her head of department suggested that she might be better off looking for a new job or carrying out supply teaching. From the following day Ms Pearce was absent from work suffering from depression. In December 1995 she submitted an application for ill-health retirement which was accepted on 30 April 1996 and took effect from 16 May 1996. Thereafter on 17 July 1996 Ms Pearce wrote to the respondent and on 13 November the chairman replied: "I admire your courage in being so open about your situation but surely you must have known that in making your position known publicly you risked comments and, such is the world, possibly even abuse, from both adults and children."

  131. On 17 March 1997 Ms Pearce presented an originating application to the employment tribunal under the 1975 Act. She sought compensation from the respondent on the ground that they were in breach, specifically, of sections 1(1)(a) and 6(2)(b) of the 1975 Act by failing to prevent the act (sic) of harassment (by the pupils). On 8 July a tribunal chairman held that it was not just and equitable to hear the complaint out of time but on 26 October 1998 the Employment Appeal Tribunal ("the EAT") allowed Ms Pearce's appeal and remitted the matter to the tribunal for a full hearing. In giving the decision of the EAT, His Honour Judge Clark said:

    The determination of the substantive issue here requires the employment tribunal to decide, as a matter of fact, what treatment the applicant received, and in particular what steps were taken by the respondent's management, including Ms Millard, to deal with the applicant's complaints of harassment by the pupils. Was she treated less favourably than a male homosexual teacher would have been treated, and, if she was treated less favourably, was she so treated because of her sex?

  132. In addition to the facts that I have already narrated, the employment tribunal found that the school dealt with each incident which Ms Pearce drew to their attention by seeing any named pupils. The school appeared, however, to shrug their shoulders at those incidents where she could not name the pupils concerned. Moreover, the school allowed the problem to continue over an unacceptable time. They also failed to take any action which involved the whole school rather than just individually named pupils and they failed to offer adequate support to Ms Pearce either by changing her classes or by offering practical support in the way that she handled her lessons.

  133. One of the teachers and the headmaster gave two reasons for not taking specific steps. The first was difficulties over section 2A of the Local Government Act 1986, as amended by section 28 of the Local Government Act 1988, which prohibited a local authority from promoting a homosexual lifestyle. The other was that they did not want to put specific matters into the school's equal opportunities policy and wanted "a holistic approach". The employment tribunal found both of these reasons to be unsatisfactory. Section 28 did not prevent a school from outlawing homophobic abuse, while the suggestion that the school did not want to list specific matters in their equal opportunities policy flew in the face of the fact that the policy already contained a list, mentioning age, gender, ability and ethnic origin. There seemed to the tribunal to be no reason not to include homophobia, which was clearly a current problem at the school. The tribunal also had doubts about the headmaster's suggestion that the topic of homophobia could be introduced in the school assemblies under the discussion of "differences" since the discussion of differences had already taken place in brief sessions led by the pupils themselves raising questions.

  134. Counsel for Ms Pearce submitted to the tribunal that, because all the abuse (apart from the 1 March 1995 incident) referred to her as a lesbian, and since the terms of abuse were apt only for a woman and not for a man, the incidents of abuse were gender-specific and therefore amounted ipso facto to discrimination on the ground of her sex, in the sense of gender. The tool of abuse was used, in part at least, because Ms Pearce was a woman: Strathclyde Regional Council v Porcelli 1986 SC 137; [1986] ICR 564. Counsel for Ms Pearce further argued that the school were directly responsible for sex discrimination because of their failure to deal properly with the pupils' abuse in circumstances where the school had the necessary control: Burton v De Vere Hotels Ltd [1997] ICR 1. Counsel for the respondent argued, by contrast, that the pupils harassed Ms Pearce not on the basis of her sex but on the basis of her sexual orientation or perceived sexual orientation as a female homosexual. In any event the school would not have been responsible for any sex discrimination on the part of the pupils.

  135. The employment tribunal concluded that Ms Pearce had been subjected to discrimination on the ground of her sex in the incident on 1 March 1995. Paragraphs 80 and 81 of their extended reasons dealt with this particular incident:

    80.

    However, we have considered the incident on 1 March 1995 which is quite different in character from the other incidents which, over a number of years, had concentrated on the applicant's sexuality. This one incident, the so-called 'cat food' incident involved a group of boys calling out the word 'pussy'. According to the applicant, this remark appeared to be directed at a male pupil. Also, there were general comments from the group about the smell of fish and cat food. One of the pupils called out about a tin of cat food in a drawer. At the end of the afternoon, the applicant found an open tin of cat food and half the contents tipped into her pocket.

    81.

    This incident appears to be quite different because the reference to a cat and fish smell and 'pussy' (if it was directed at the applicant) was directly referring to a woman and a woman's anatomy, not to a lesbian woman. This one incident is in our view capable of amounting to sex discrimination ....

  136. The tribunal went on in paragraphs 84 to 86 to deal with the remainder of the incidents and held that they did not constitute discrimination on the ground of Ms Pearce's gender:

    84.

    There could only be discrimination if a hypothetical male homosexual teacher would have been treated differently from the applicant, and the applicant has not put forward any evidence or argument to suggest that a male homosexual teacher would have been treated any differently either by the pupils or by the school, and in particular we have heard no evidence that a hypothetical homosexual male teacher would have been treated more favourably than the applicant.

    85.

    Indeed, the evidence is all the other way, since the applicant called evidence from Mr. Peirce, a former teacher, who indicated that he had been subjected to taunts on the ground of what the pupils perceived to be his sexuality, although he is not, in fact, a homosexual and there has certainly been no suggestion that he was treated more favourably by the school than the applicant was.

    86.

    Our conclusion on this issue, therefore, is that the substantial campaign of abuse towards the applicant over a number of years was not capable in law of amounting to sex discrimination, apart, that is, from the one incident on 1 March 1995.

  137. With the (possible) exception of the incident on 1 March 1995, the tribunal therefore required to dismiss Ms Pearce's application for compensation from the respondent. Since the pupils had not discriminated against her on the ground of her sex, as opposed to her sexuality, in terms of section 6(2)(b) of the 1975 Act the respondent could not have "subjected" her to any detriment which amounted to sex discrimination in the form of sexual harassment by the pupils. In respect of the 1 March 1995 incident the tribunal found that the school had reacted promptly. They saw and appropriately punished the pupils concerned: the pupil who put the cat food in Ms Pearce's pocket was suspended for five days and the other pupils were seen. The action taken was appropriate and the pupil who was suspended caused no further trouble during the short time before Ms Pearce stopped teaching at the school. The tribunal concluded that, since the school had acted promptly and supported Ms Pearce, they were not directly responsible for any sex discrimination constituted by the actings of the pupils on this occasion. Ms Pearce has not challenged that conclusion.

  138. So far as the remainder of the incidents were concerned, however, the tribunal concluded that, if they had required to make a finding about the school's actions concerning them, they would have found that they had not taken appropriate steps and were therefore directly responsible for sex discrimination.

  139. Ms Pearce appealed to the EAT which dismissed her appeal: [2000] ICR 920. They held that all the abuse, including the 1 March 1995 incident, had been homophobic and not on the ground of Ms Pearce's sex. They further held that the tribunal had erred in law in holding that the school would have been liable for the acts of the pupils. The EAT held in particular that, before finding that the school had subjected Ms Pearce to discrimination, the tribunal would not only have had to identify the steps which the school had failed to take but would also have had to conclude that those steps could have prevented or reduced the discrimination. Although the employment tribunal had identified steps which the school should have taken, they had failed to find that those steps could have prevented or reduced the extent of the harassment.

  140. Since Ms Pearce no longer contends that the respondent should be held liable for the incident on 1 March 1995, it is unnecessary to decide whether, as the EAT considered, [2000] ICR 920, 931 - 932, paras 11 - 13, that incident was better seen as part of the pattern of abuse based on her sexual orientation rather than as an isolated incident of sex discrimination. I find it hard, however, to see why on this one occasion the pupils concerned should have targeted Ms Pearce simply because she was a woman rather than because she was a lesbian. I should therefore incline to accept the EAT's conclusion on this point.

  141. Ms Pearce appealed but again the Court of Appeal rejected her appeal: [2001] EWCA Civ 1347; [2002] ICR 198. She argued that the pupils' treatment of her was on the ground of her sex because, but for her gender, she would not have been subjected to the particular vulgar abuse in question. Ms Pearce also argued that, in any event, even if the verbal abuse was on the ground of her sexual orientation, the pupils still treated her in that way because she was a woman since a man who was attracted to women would not have been treated in the same way. The Court of Appeal held that they were bound by Smith v Gardner Merchant Ltd [1999] ICR 134 and refused the appeal. Judge and Henry LJJ also agreed with the EAT that the employment tribunal had been wrong to find that the school would have been liable if the acts of the pupils had constituted sex discrimination. Hale LJ held that, if she had not been bound by Smith v Gardner Merchant Ltd, she would have held that sexuality was an irrelevant circumstance for the purpose of the comparison required by section 5(3) of the 1975 Act. She would also not have interfered with the employment tribunal's obiter conclusion on the liability of the school.

  142. In her appeal to this House Ms Pearce accepted that the 1975 Act applied only to discrimination on the ground of gender and not to discrimination on the ground of sexual orientation. She submitted, however, that in certain situations both discrimination on the ground of gender and discrimination on the ground of sexual orientation were to be found. It was therefore wrong to proceed on the footing that treatment was necessarily based either on the ground of sex or on the ground of sexuality: a tribunal had to consider whether the treatment was on the ground of sex even if it was (also) on the ground of sexuality. In the present case, even although the tribunal had found that, with the exception of the incident on 1 March 1995, the pupils had abused Ms Pearce on the ground of her sexuality, they should also have held that the pupils had discriminated against her on the ground of her sex. Two possible ways of reaching that conclusion were canvassed in the first two issues in the appeal.

  143. Under the first issue Mr. Emmerson QC adopted the reasoning of Lord Prosser in his dissenting opinion in Macdonald v Ministry of Defence [2002] ICR 174. On a proper analysis it could be seen that the pupils had abused Ms Pearce because she was a woman who was attracted to women. They would not have similarly abused a male teacher who was attracted to women. So, in terms of section 1(1)(a) of the 1975 Act, the pupils had treated her less favourably than a heterosexual man in the same circumstances. For the respondent Ms Booth QC submitted that this approach was flawed. The employment tribunal had found that the pupils had abused Ms Pearce because of her sexuality rather than her gender and furthermore that all the indications were that they would have directed equivalent abuse at a male homosexual teacher. The comparison with a homosexual teacher was the correct one for the purposes of section 1(1)(a): the fact that the pupils would not have abused a heterosexual male teacher was accordingly irrelevant.

  144. The alternative argument for Ms Pearce made up the second issue in the appeal. The terms of the abuse used by the pupils were gender-specific: such terms as "lesbian", "lezzie" and "lemon" could only be used of a female homosexual. Therefore, but for her sex, the pupils would not have subjected her to abuse in these terms. Where the harassment was of a kind that could only be addressed to a woman, a tribunal did not need to identify a male comparator: the pupils had treated Ms Pearce differently from the way that they would have treated any man. Such treatment therefore fell to be regarded as sex discrimination in terms of section 1(1)(a) of the 1975 Act: Strathclyde Regional Council v Porcelli 1986 SC 137; [1986] ICR 564. On behalf of the respondent Ms Booth argued that this approach too was flawed. It was wrong to examine minutely the precise words used in abusing Ms Pearce and to infer from them that the pupils were abusing her because she was a woman. The pupils abused Ms Pearce because she was a homosexual and in doing so simply used terms of abuse that applied to a homosexual woman. Had they abused a male teacher because he was a homosexual they would equally have used terms of abuse that applied to a homosexual man. In each case they might have used gender-neutral terms of abuse towards homosexuals: the precise terms used were therefore not a basis for saying that the pupils had abused Ms Pearce on the ground of her sex. In so far as any observations of the judges in Strathclyde Regional Council v Porcelli and subsequent authorities might suggest that in cases of sexual harassment there was, as a matter of law, no need to make a comparison with the treatment of a male, they were unsound.

  145. The third issue in Ms Pearce's appeal arises only if she succeeds on either of the first two issues and the pupils' treatment of her falls to be regarded as sex discrimination in terms of the 1975 Act. In that event, Mr. Emmerson submitted that the House should adopt the provisional conclusion of the employment tribunal that the school would have subjected Ms Pearce to a detriment in the form of sex discrimination by the pupils and that the respondent would accordingly have been liable themselves in terms of sections 1(1)(a) and 6(2)(b) of the 1975 Act: Burton v De Vere Hotels Ltd [1997] ICR 1. Acting as an employment jury, the employment tribunal had been entitled to reach that conclusion and the EAT and the majority of the Court of Appeal had been wrong to interfere with it. The case should therefore be remitted to the tribunal to deal simply with compensation. Ms Booth submitted that Judge LJ's criticisms of the employment tribunal's conclusion on this point were sound and that, even if Ms Pearce succeeded on either of the first two issues, the appropriate course would be for the House to hold that she had not established that the school had failed to take any step which would have prevented or reduced the pupils' discrimination against her. Her appeal should therefore be refused.

    THE FIRST ISSUE

  146. The issue raised by the first ground of appeal is the same in both cases, even though the facts giving rise to it are very different. I begin with the case of Mr. Macdonald but much of what I say in that regard applies equally to the case of Ms Pearce. Put shortly, Mr. Macdonald's argument is that the RAF dismissed him because he admitted to being attracted to men, whereas they would not have dismissed a woman who admitted to being attracted to men. They accordingly treated him less favourably than they would have treated a woman in the same circumstances. This amounts to discrimination against him as an employee: sections 1(1)(a) and 6(2)(b) of the 1975 Act. The submission is based on a line of argument to be found in D Pannick, Sex Discrimination Law (1985), pp 200 - 203 and in various writings by Dr Robert Wintemute, such as Sexual Orientation and Human Rights (1995), pp 201 - 207 and "Recognising New Kinds of Direct Sex Discrimination: Transsexualism, Sexual Orientation and Dress Codes" (1997) 60 MLR 334, 344 - 353.

    General aspects of the 1975 Act

  147. I must first notice a number of more general points relating to the 1975 Act.

  148. It is common ground that the 1975 Act was designed to deal with the mischief of discrimination on the ground of sex, in the sense of gender as opposed to sexual orientation. This is consistent with the fact that the Act was intended to give effect to Council Directive 76/207/EEC of 9 February 1976 on the implementation of the principle of equal treatment for men and women as regards access to employment, vocational training and promotion, and working conditions ("the Equal Treatment Directive"). Counsel for the respondents in both appeals contended that, once it was accepted that the 1975 Act dealt with discrimination on the ground of gender, it followed that the appellants must necessarily fail on the first issue since they were asking the House to distort the interpretation of the 1975 Act so as to accommodate a claim for discrimination on the ground of sexual orientation. I should not be inclined to go so far. Once it is clear that the 1975 Act is intended to deal with discrimination on the ground of gender rather than sexual orientation, it is certainly equally clear that, even on the appellants' approach, cases like theirs could not have been at the heart of the legislators' concerns in enacting the statute. Rather, as is suggested by the form of section 1(1)(a), the opening provision of the Act, Parliament's main concern was to put an end to certain areas of discrimination against women on the ground that they were women rather than men. The legislators are therefore unlikely to have envisaged that homosexual persons such as the appellants would seek to use the Act to advance the kinds of claims to be found in these appeals. In itself that is not, however, a conclusive objection to the success of these claims. If the appellants could indeed show that they had been less favourably treated on the ground of their sex, then they would be entitled to a remedy even if theirs were marginal, rather than paradigm, cases of sex discrimination under the Act.

  149. If sound, the appellants' approach is undoubtedly far-reaching. At first sight, it might seem as if it would turn every claim for discrimination on the ground of sexual orientation into a claim for discrimination on the ground of sex under the 1975 Act. Which, again, might be thought to run counter to Parliament's intention. With the aid of a number of ingenious and, more or less, plausible scenarios Mr. Emmerson showed, however, that even on the appellants' interpretation there could be cases of discrimination on the ground of sexual orientation which would not constitute claims of sex discrimination under the Act. For example, if an employer employs only lesbians, then a heterosexual woman who is refused work has no claim for sex discrimination since she has not been treated less favourably than any man, whether heterosexual or homosexual.

  150. The appellants' approach posits that in certain situations a person can be discriminated against both on the ground of sexual orientation and on the ground of sex. In Smith v Gardner Merchant Ltd [1999] ICR 134, 146 - 147 Ward LJ accepted that this was possible. I do too: in the example that I have just given, a homosexual man could complain that the employer discriminated against him both on the ground of his sex and on the ground of his sexual orientation, for that would, in fact, be the position. It is therefore no objection in principle to the appellants' argument that it would involve holding that they had suffered discrimination on both grounds. Whether in any individual case someone discriminates on both grounds is, however, a question of fact to be resolved by a tribunal on the basis of the evidence.

  151. Although counsel for the respondents argued that the appellants' approach in these appeals depended on distorting the terms of the 1975 Act, I am not satisfied that this is so. As I have explained, Mr. Macdonald says that the RAF dismissed him because he admitted to being attracted to men, whereas they would not have dismissed a woman who admitted to being attracted to men. He was therefore treated less favourably than a woman in the same circumstances on the ground of his sex. If he were correct to characterise what happened to him in this way, then there would be nothing forced in saying that the RAF had discriminated against him in terms of sections 1(1)(a) and 6(2)(b). For that reason, Mr. Macdonald's case would not, in my view, be significantly advanced by applying any more generous canon of construction to the interpretation of the relevant sections in the light of the decisions of the European Court of Human Rights in Smith & Grady v United Kingdom (1999) 29 EHRR 49 and Lustig-Prean & Beckett v United Kingdom (1999) 29 EHRR 584. I should add that, even assuming that section 22(4) of the Human Rights Act 1998 applies to proceedings that were pending when it came into force, for the reasons given by my noble and learned friend Lord Nicholls of Birkenhead, Mr. Macdonald cannot obtain a remedy under that Act in these proceedings.

  152. Since the 1975 Act was intended to be administered by employment tribunals with a predominantly lay membership, Parliament must have envisaged that the issues to be decided under the Act would, typically at least, be issues of fact rather than issues of law, far less, sophisticated issues of law. Moreover, since all the matters of fact in a case are for the tribunal to determine, it is only exceptionally that an appellate body will be entitled to interfere with the facts as found by the tribunal. Despite the copious citation of legal authorities, however, what the appellants are really asking the House to do is indeed to revisit the facts as determined by the tribunals in these appeals, to re-analyse them and, on the basis of that re-analysis, to conclude that the appellants were treated less favourably on the ground of their sex. Within appropriate limits re-analysis of facts may, of course, be entirely legitimate and indeed helpful; it will be unhelpful and illegitimate, however, if it involves unjustifiably altering or displacing the facts as found by the tribunal.

    The appropriate comparison

  153. In both appeals the critical difference between the parties may seem narrow. Sections 1(1)(a) and 5(3) require a comparison to be made between the way the alleged discriminator treats the alleged victim in "the relevant circumstances" and the way he treats or would treat a person of the opposite sex in the same or not materially different circumstances. For the appellants the crucial question is whether, as the respondents contend, their homosexuality was a "relevant circumstance" for the purposes of this comparison. Both employment tribunals held that it was and that the appellants had not been treated less favourably than a homosexual of the opposite sex would have been treated. Their applications accordingly failed. The Extra Division of the Court of Session and the Court of Appeal upheld those decisions. If the appellants' homosexuality, i.e. their attraction to persons of the same sex, is not a relevant circumstance, however, then the appellants fall to be regarded simply, respectively, as a man who is attracted to men and a woman who is attracted to women. On that approach Mr. Macdonald would have been able to satisfy the tribunal that he had been treated less favourably than a woman attracted to men (who would not have been dismissed), while Ms Pearce could have shown that the pupils had treated her less favourably than a man attracted to women (who would not have been subjected to the same abuse).

  154. At various times during the argument in Ms Pearce's appeal Mr. Emmerson suggested that the answer in her case could be found simply by applying the "but for" test first set out in the speech of Lord Goff of Chieveley in R v Birmingham City Council, Ex p Equal Opportunities Commission [1989] AC 1155, 1193 - 1195 and then repeated by him in James v Eastleigh Borough Council [1990] 2 AC 751, 774B - C. As Lord Goff saw it,

    cases of direct discrimination under section 1(1)(a) can be considered by asking the simple question: would the complainant have received the same treatment from the defendant but for his or her sex?

    If one asked "Would Ms Pearce have received the same treatment from the pupils but for her sex?" then, said Mr. Emmerson, the answer was that she would not. But, in truth, Lord Goff's test offers no quick solution. The test, which falls to be applied within the context of sections 1(1)(a) and 5(3), is expressed in an attractive shorthand. Spelled out somewhat more fully, in this case Lord Goff's question is: "In similar circumstances would Ms Pearce have received the same treatment from the pupils if she had been a man?" The convenient shorthand version must not be allowed to obscure the fact that a tribunal cannot answer the question without knowing what the relevant circumstances are.

  155. In Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] ICR 337 the House had occasion to consider what circumstances amount to "the relevant circumstances" in article 7 of the Sex Discrimination (Northern Ireland) Order 1976, which is in identical terms to section 5(3) of the 1975 Act. As I explained in that case, at paras 134-136, in my view "the relevant circumstances" in section 5(3) are those which the alleged discriminator takes into account when deciding to treat the woman as he does or when deciding to treat a man as he treats, or would treat, him. In a contested case it is for the employment tribunal to decide on the basis of the available evidence what circumstances the alleged discriminator takes into account or would take into account in reaching his decision.

  156. In Mr. Macdonald's case, therefore, the employment tribunal had to decide what circumstances the RAF took into account when deciding to dismiss him. Those were then the relevant circumstances for the purposes of determining whether the RAF had treated him less favourably than they would have treated a woman.

  157. Before the tribunal Mr. Macdonald did not dispute that, when they dismissed him, the RAF were applying the policy on homosexual personnel which was then current. Paragraph 1032(1) of Queen's Regulations stated: "Homosexuality, whether male or female, is considered incompatible with service in the Armed Forces." The policy encapsulated in that paragraph was set out more fully in an official leaflet, AP 3392 - Vol 5, No 107 dated August 1995 which defined a homosexual as "a person who is sexually attracted to a member of the same sex" and homosexuality as "behaviour characterised by being sexually attracted to members of the same sex". Paragraph 3 of the policy included the following:

    Homosexuality, whether male or female, is considered incompatible with service in the Armed Forces. This is not only because of the close physical conditions in which personnel often have to live and work, but also because homosexual behaviour can cause offence, polarise relationships, induce ill-discipline and, as a consequence, damage morale and unit effectiveness. If individuals admit to being homosexual while serving and their CO judges that the admission is well founded they will be required to leave the Services.

    This policy subjected homosexual men and women who wished to serve in Her Majesty's armed forces to a privilegium odiosum. Following the decisions of the European Court of Human Rights in Smith & Grady v United Kingdom (1999) 29 EHRR 49 and Lustig-Prean & Beckett v United Kingdom (1999) 29 EHRR 548, however, the armed forces abandoned the policy. So service men and women no longer face the problems which confronted Mr. Macdonald. In the circumstances the Advocate General did not seek to justify the treatment of Mr. Macdonald under the former policy.

  158. Since the RAF applied that policy in the case of Mr. Macdonald, the criteria that it contained are an indication of the circumstances which they took into account when deciding to dismiss him. In terms of the policy individuals were to be required to leave the service if they "admitted to being homosexual while serving" and their commanding officer judged the admission to be well founded. So, once the tribunal were satisfied that the RAF dismissed Mr. Macdonald because he admitted to being homosexual, that admission would indeed be the relevant circumstance in his case for the purposes of section 5(3). His case would therefore fall to be compared with that of a woman who admitted to being a homosexual.

    Community Law

  159. Before turning to examine a number of arguments which the appellant advances against adopting this straightforward approach, it is important to notice that it is consistent with the role of the 1975 Act as the vehicle for transposing the Equal Treatment Directive into the domestic law of the United Kingdom. The Court of Justice has rejected attempts to use the Directive to give a remedy to litigants who were, it held, really complaining of discrimination on the ground of their sexual orientation.

  160. So in Grant v South-West Trains Ltd C-249/96 [1998] ECR I-621 a female employee of a railway company had been living in "a meaningful relationship" with another woman for over two years. She applied for a travel concession for her partner. A male employee living in a meaningful relationship with a woman for over two years would have been entitled to the concession. The company refused to give Ms Grant the benefit on the ground that in terms of their regulations the concession could be granted only for a partner of the opposite sex. The tribunal referred a number of questions to the European Court of Justice. The court held inter alia, at paras 26 - 28:

    26.

    The refusal to allow Ms Grant the concessions is based on the fact that she does not satisfy the conditions prescribed in those regulations, more particularly on the fact that she does not live with a 'spouse' or a person of the opposite sex with whom she has had a 'meaningful' relationship for at least two years.

    27.

    That condition, the effect of which is that the worker must live in a stable relationship with a person of the opposite sex in order to benefit from the travel concessions is, like the other alternative conditions prescribed in the undertaking's regulations, applied regardless of the sex of the worker concerned. Thus travel concessions are refused to a male worker if he is living with a person of the same sex, just as they are to a female worker if she is living with a person of the same sex.

    28.

    Since the condition imposed by the undertaking's regulations applies in the same way to female and male workers, it cannot be regarded as constituting discrimination directly based on sex.

  161. Similarly, in D & the Kingdom of Sweden v Council of the European Union C-122/99 P and C-125/99 P [2001] ECR I-4319 D was an official of the Council of the European Union who had registered his partnership with another man under the relevant Swedish legislation. He applied to the Council for a household allowance that was available in terms of the staff regulations to a married official. The Council rejected the application on the ground that the regulations could not be construed as allowing a registered partnership to be treated as being equivalent to marriage. D brought proceedings in the Court of First Instance challenging that decision inter alia on the ground of sex discrimination. The court dismissed the application and D appealed to the Court of Justice which held:

    45.

    D contends that the contested decision, which deprives him of an allowance to which his married colleagues are entitled solely on the ground that the partner with whom he is living is of the same sex as himself, constitutes, contrary to what the Court of First Instance held, discrimination based on sex, in breach of article 119 of the Treaty, and infringement of the principle of equal treatment.

    46.

    It should be observed first of all that it is irrelevant for the purposes of granting the household allowance whether the official is a man or a woman. The relevant provision of the Staff Regulations, which restricts the allowance to married officials, cannot therefore be regarded as being discriminatory on grounds of the sex of the person concerned, or, therefore, as being in breach of article 119 of the Treaty.

  162. These two decisions are significant because, on matters raising essentially the same issue as is raised by the appellants in the present cases, the Court of Justice rejected the approach advocated by the appellants.

  163. The position under Community law has moved on, however. Article 13 of the EC Treaty now deals with discrimination on the ground of sexual orientation. On that Treaty base the Council adopted Directive 2000/78/EC of 27 November 2000 establishing a general framework for equal treatment in employment and occupation. The member states must transpose the directive into their domestic legal systems by 2 December 2003. Subject only to limited exceptions, articles 1 and 2 prohibit discrimination on the ground of sexual orientation in relation to matters of employment and occupation. The Government has issued for consultation a draft regulation to be made under section 2(2)(a) of the European Communities Act 1972. Once in force that legislation will provide remedies in United Kingdom law to persons, such as the appellants, who complain of discrimination on the ground of their sexual orientation in relation to their employment.

    The male homosexual - female heterosexual comparison

  164. In an attractive submission Mr. O'Neill QC argued, however, that, even under the existing law, Mr. Macdonald was entitled to a remedy. In broad terms he adopted the reasoning of Lord Prosser in the Court of Session. In particular he submitted that it was wrong to include among the relevant circumstances for the purposes of section 5(3) the fact that Mr. Macdonald had admitted to being a "homosexual" - the description or characterisation used in the RAF policy. I accept that it would be objectionable to include that description or characterisation among the relevant circumstances if it had itself been inherently discriminatory on the ground of sex. In James v Eastleigh Borough Council, for instance, the objection to including "pensionable age" among the relevant circumstances for the purpose of comparing the council's treatment of Mr. James with their treatment of his wife was not that it derived from the council's policy but rather that the criterion was itself discriminatory: [1990] 2 AC 751, 766D - E per Lord Bridge of Harwich. Similarly, the inclusion of Mr. Macdonald's homosexuality among the relevant circumstances of his case would be objectionable if, but only if, that criterion, as used in the RAF policy, was itself discriminatory on the ground of sex.

  165. Mr. O'Neill submitted that the RAF policy did indeed discriminate on the ground of sex. He said that this became clearer if the policy were broken down. The statement in the policy:

    if individuals admit to being homosexual while serving .... they will be required to leave the Service

    could be analysed into two parallel statements:

    if men admit to being attracted to men while serving .... they will be required to leave the Service; if women admit to being attracted to women while serving .... they will be required to leave the Service.

    In effect, it was the first of those two parallel statements that had been applied in Mr. Macdonald's case: the RAF had treated him as a man who had admitted to being attracted to men and had accordingly dismissed him. Since a woman who admitted to being attracted to men while serving would not have been required to leave the service, the RAF had treated him less favourably than a woman in the same circumstances on the ground of his sex.

  166. The logic is impeccable but the argument is flawed.

  167. Let it be assumed that the RAF policy can be broken down in this way. Nevertheless, the statement relating to males has to be considered along with the parallel statement relating to females. When taken together, the two statements would still make up a gender-neutral policy for dealing with homosexuals serving in the RAF: whatever their gender, they would have to be dismissed. So, other things being equal, the process of rewriting does not reveal that beneath the gender-neutral surface of the actual policy there lurked a different gender-specific policy.

  168. In any event, the proper approach is indeed to have regard to the actual terms of the policy which, according to the evidence, the RAF applied in Mr. Macdonald's case. On its face that policy was gender-neutral: it applied to all "individuals", irrespective of gender, who admitted to being homosexual. Nor did Mr. O'Neill argue that the application of the policy involved indirect discrimination against male, as opposed to female, homosexuals. In his powerful dissent in the Court of Session, 2002 SC 1, 14, para 37, however, Lord Prosser held that the actual discrimination in Mr. Macdonald's case was quite simply on the ground of gender. In coming to that view he placed considerable emphasis on homosexual relationships as partnerships and in effect saw the RAF policy as being concerned with who could be a partner of a male or female in the service. On this basis he drew an analogy with a bridge club that has a rule allowing, say, only single-sex pairs (which might be described as "same-sex pairs" and which might indeed have been described as "homo-sexual pairs" if the language had developed differently). If an individual of known gender asks whether he or she can have Y as his or her partner, then the answer will depend on Y's gender. Lord Prosser commented that it could therefore not be denied that a refusal in terms of the rule was on the ground of gender: 2002 SC 1, 13, para 35. He went on to say that, where a decision depended critically on discovering the gender of each partner, this must not be masked by the use of referential terms such as "same" or "opposite": 2002 SC 1, 14, para 37. Mr. O'Neill commended Lord Prosser's approach. With respect, however, I am not persuaded that his argument shows that the RAF discriminated against Mr. Macdonald on the ground of his sex rather than on the ground of his sexual orientation.

  169. In Lord Prosser's example, the bridge club committee might, I suppose, adopt a single-sex rule for pairs because, in their painful experience, single-sex pairs conduct somewhat less violent post-mortems than mixed pairs. In adopting and enforcing the policy, the committee would be hoping to minimise dispeace in the club. It would certainly be no part of their aim to discriminate between men and women on the ground of their sex. Rather, they would wish to treat women in exactly the same way as men: women could only play with women and men with men. All that would matter to the committee would be that the two players making up a pair should be of the same sex. The committee's policy would therefore be gender-neutral. In this respect it would be identical with the RAF policy.

  170. Since both the RAF policy and the bridge club rule are expressed in terms of "the same sex", in theory both could be operated without knowing the sex of the persons concerned. So, if the secretary of the bridge club receives a booking for four single-sex pairs for Saturday evening, she knows that, in accordance with the club rule, she can set aside two tables for them without ascertaining the genders of the persons making up the pairs. Similarly, if a clerk in the RAF had been presented with a pile of anonymous forms, each containing an admission that the individual concerned was attracted to persons of the same sex, the clerk would have known that the individuals were homosexuals and fell to be dealt with in terms of the homosexuality policy.

  171. In practice, however, more often than not it will be necessary to have regard to gender when operating such a gender-neutral policy. For instance, as Lord Prosser's example of the bridge club shows, the secretary will usually have to discover someone's gender in order to be able to enforce the rule stipulating that only people of the same sex may play as partners. Therefore the fact that the bridge club's rule is gender-neutral does not mean that questions of gender do not arise when the rule is being operated. Conversely - and more importantly for present purposes - the fact that questions have to be asked about gender in order to operate the rule does not mean that the rule itself is not gender-neutral or that the club treats people favourably or unfavourably on the ground of their sex. If, for instance, a lady member of the bridge club asks the secretary whether she can play with her friend Evelyn, the secretary must ask her whether her friend is a "he-Evelyn" or a "she-Evelyn". This is not because the secretary has any intention of treating the lady member less favourably than a gentleman member: rather, the secretary must find out Evelyn's gender simply in order to be able to say whether the friends can play together under the club's (gender-neutral) rule permitting single-sex pairs only.

  172. The same applies if a night club advertises an evening for "gay couples". A doorman confronted by a man wanting to get in must discover whether he is accompanied by another man. Similarly, if confronted by a woman wanting to get in, the doorman must find out whether she has a woman with her. The club has no preference for men rather than women or for women rather than men. On this particular evening, however, it wants only homosexual couples and, to that end, it operates a gender-neutral policy but one that the doorman cannot apply without knowing the sex of the two members of any couple asking to be allowed in. It would be absurd to suggest that, by not permitting a woman to enter in the company of a man, the doorman treats her less favourably, on the ground of her sex, than a man who wants to be admitted along with another man. Rather, the doorman is enforcing the club policy for this particular evening, which is to limit admission to homosexual couples and to exclude heterosexual couples.

  173. Similarly, if a male officer in the RAF had said to his commanding officer that he was attracted to Evelyn, the commanding officer would have had to discover Evelyn's gender simply in order to know whether the RAF's homosexuality policy applied. Had a female officer said the same thing, the commanding officer would have had to ask exactly the same question for the same reason. The fact that these questions had to be asked does not mean that the RAF - any more than the secretary of the bridge club or the doorman of the night club - were discriminating on the ground of sex, by favouring women over men or vice versa. If it turned out that the policy did apply, the circumstance that the RAF would take into account in deciding to dismiss the officer would be that the officer, whether male or female, was attracted to a member of the same sex. The RAF would treat officers of both sexes in precisely the same way. More particularly, they would not treat officers of one sex less favourably than those of the other on the ground of their sex.

  174. Since the RAF policy was designed to treat homosexual men and homosexual women equally, it is not to be compared with the racial discrimination legislation which the United States Supreme Court struck down in Loving v Virginia 388 US 1 (1967). The intention of the Virginian legislature was to maintain white supremacy by preventing a white person from marrying an "inferior" black person. In that situation the Supreme Court had no difficulty in rejecting Virginia's argument that there was no racial discrimination because a white man wanting to marry a black woman and a black man wanting to marry a white woman were both punished. The argument was fallacious since both cases involved deliberate racial discrimination. I refer, for example, to the comments in the majority opinion in Lawrence & Garner v Texas 41 SW 3d 349, 357 - 358 (2001). By contrast, since in adopting their policy the RAF's aim was not to treat persons of one sex less favourably than persons of the other, it is legitimate, when considering whether the policy did none the less involve discrimination on the ground of sex, to have regard to the fact that a female homosexual was to be dismissed just like a male homosexual.

  175. In Smyth v Croft Inns Ltd [1996] IRLR 84 the defendants employed the Roman Catholic applicant as a barman in a pub with Protestant customers in a loyalist area of Belfast. The charge hand received a sinister message to the effect that the applicant should not be in the bar the following week. The applicant was worried by the threat but the defendants took no steps except to tell him that he could stay or go. The applicant resigned and made an application to the Fair Employment Tribunal under the Fair Employment (Northern Ireland) Act 1976. He claimed that the defendants had discriminated against him on grounds of religious belief in that they had constructively dismissed him. The defendants argued inter alia that they would have treated a Protestant barman in a pub with Roman Catholic customers in a Roman Catholic area in the same way. The Court of Appeal in Northern Ireland rejected that argument as fallacious on the ground that, if the defendants had treated the Protestant barman in the same way, they would have been guilty of religious discrimination against both barmen. In my respectful opinion, that decision was plainly correct, but it does not assist Mr. Macdonald. In Smyth the defendants treated the applicant less favourably than a Protestant barman working in the same pub and would have treated a Protestant barman less favourably than a Roman Catholic barman working in the same pub. On the defendants' argument there would therefore have been two acts of religious discrimination and, as the Court of Appeal held, the one could not cancel out the other. By contrast, the RAF did not treat Mr. Macdonald less favourably than a female homosexual who admitted to being homosexual; likewise they would not have treated a female homosexual who admitted to being homosexual less favourably than a male homosexual in the same circumstances. There is therefore no question in Mr. Macdonald's case of one act of sex discrimination being used to cancel out another.

    Disposal of Mr. Macdonald's first ground of appeal

  176. Before the employment tribunal Mr. Macdonald did not dispute that the RAF applied their policy on homosexuality in reaching their decision to dismiss him. Nor did he suggest that they applied any other policy. It was therefore open to the employment tribunal, as a reasonable tribunal, to conclude that the RAF dismissed Mr. Macdonald because he had admitted to being a homosexual. And that was indeed the tribunal's finding on what was a matter of fact. There is no legitimate basis upon which the House could interfere with that finding. That being so, Mr. Macdonald's admission to being a homosexual was the crucial circumstance in his case for the purpose of comparing the way the RAF treated him with the way they would have treated a woman in the same circumstances. Mr. Macdonald accepts that the RAF would also have dismissed a woman who admitted to being a homosexual. It follows that he has failed to show that the RAF treated him less favourably than they would have treated a woman in the same circumstances. His first ground of appeal must accordingly be rejected.

    Disposal of Ms Pearce's first ground of appeal

  177. Like Mr. Macdonald, on her first ground of appeal Ms Pearce runs headlong into the findings of the employment tribunal. Again, the relevant circumstances for the purposes of the section 5(3) comparison were those that the tribunal found that the pupils had taken into account when treating her as they did. As is clear from paragraphs 80 to 86 of their extended reasons, having considered the evidence, the tribunal came to the view that, with the exception of the incident on 1 March 1995, the pupils decided to treat Ms Pearce as they did not because of her sex but because of her sexual orientation. In other words, the pupils took account of her sexual orientation. The tribunal reached that conclusion, which is a factual conclusion, because the terms of abuse that the pupils used ("lezzie", "lemon" etc) were directed to her sexuality. It was a conclusion which the tribunal, as a reasonable tribunal, were entitled to reach and with which the House cannot, accordingly, interfere. That being so, among the relevant circumstances in her case was the fact that Ms Pearce was a homosexual teacher. So what the tribunal required to do in terms of sections 1(1)(a) and 5(3) was to compare the way the pupils treated Ms Pearce with the way they would have treated a male homosexual teacher. The tribunal carried out that comparison and concluded that there was nothing to suggest that the pupils would have treated a male homosexual teacher any more favourably.

  178. It follows that Ms Pearce's first ground of appeal too must be rejected.

    THE SECOND ISSUE

    Ms Pearce

  179. The second issue also raises points that apply to both appeals but, on this matter, they are more sharply focused in Ms Pearce's appeal. It is accordingly appropriate to concentrate on it.

  180. In presenting his submissions in support of the second ground of appeal Mr. Emmerson once more drew attention to the nature of the abuse which the pupils had addressed to Ms Pearce. All of it was in terms that applied exclusively to women. It followed automatically from the sex-specific terms of the abuse that it could never have been addressed to a man. The tribunal should have concluded accordingly that Ms Pearce had been treated less favourably on the ground of her sex in terms of section 1(1)(a). The pupils' treatment of her could properly be described as sexual harassment. In such cases there was no need to identify a male comparator.

  181. The origin of the no-comparator argument lies in the interpretation that has been placed on the decision of the Court of Session in Strathclyde Regional Council v Porcelli 1986 SC 137; [1986] ICR 564. Most notably, in British Telecommunications Plc v Williams [1997] IRLR 668, 669 Morison J, giving the decision of the EAT, said:

    To affect a person's dignity on the grounds of sex will, as with other forms of sexual harassment, cause a detriment to that person. Thus, proof of sexual harassment, of whatever form, will satisfy the criterion. Because the conduct which constitutes sexual harassment is itself gender-specific, there is no necessity to look for a male comparator. Indeed it would be no defence to a complaint of sexual harassment that a person of the other sex would have been similarly so treated: see Porcelli v Strathclyde Regional Council [1986] ICR 564.

    Similarly, in the EAT in Mr. Macdonald's case, when speaking of the interview in which Wing Commander Leeds asked Mr. Macdonald intrusive questions about his sexual relations with other men, Lord Johnston said that the test in Porcelli had to apply and there was therefore no need for a female comparator: [2001] ICR 1, 13, para 32. In the analogous sphere of racial discrimination the same approach is to be seen in the agreement of counsel before the EAT in Burton v De Vere Hotels [1997] ICR 1, 6, paras 18 and 19.

    Sexual harassment and Comparators

  182. The term "sexual harassment" is not to be found in the 1975 Act; nor is such conduct expressly dealt with in the Act. Again, it is noteworthy that the Equal Treatment Directive has been amended by Directive 2002/73/EC of 23 September 2002 so that, in the amended version of article 2, sexual harassment is first defined and then deemed to be discrimination on the grounds of sex. The member states have until 5 October 2005 to make the necessary changes to their domestic law.

  183. Under the 1975 Act as it exists at present, however, if a remedy is to be granted for sexual harassment, it can only be because the harasser can be said to treat his female victim "less favourably" than he treats or would treat a man on the ground of her sex: section 1(1)(a). The test is framed in terms of a comparison and the basis of that comparison is spelled out in section 5(3). These requirements must be met if conduct is to fall within the terms of the legislation.

  184. Classic cases of sexual harassment, where the motivation of the conduct is sexual, fit easily into the legislation. If, for example, a male manager pursues a female member of staff and, despite her objections, fondles her, tries to kiss her and makes suggestive remarks to her, then he subjects her to a detriment in terms of section 6(2)(b). Moreover, in doing so, in most cases at least, it can be said that he discriminates against her because he treats her less favourably on the ground of her sex than he treats or would treat male members of staff: section 1(1)(a). Since the manager is not sexually attracted to the men on the staff, he would not treat them in the same way. This is a straightforward application of the terms of the legislation: in particular, the manager's treatment of the woman is compared with his treatment of the men on his staff and is found to be less favourable. The comparison may be self-evident - because the manager is exclusively heterosexual and is driven by his attraction to the female employee - but it is none the less real.

  185. In Strathclyde Regional Council v Porcelli the idea of sexual harassment was widened to include cases where the motivation of the harasser was not sexual. It is necessary to examine the case in some detail.

  186. Mrs. Porcelli worked as a laboratory technician in a school. Two men came to work in the same department and embarked upon a policy of vindictive unpleasantness towards her with the aim of making her apply for a transfer from the school. Certain parts of this campaign involved conduct with a sexual connotation. Eventually Mrs. Porcelli transferred to another school and complained to an industrial tribunal that the two men employed by the education authority had discriminated against her on the ground of her sex. The industrial tribunal rejected her complaint and explained their reasons in this way:

    It is clear that some of the treatment was different from that which would have been directed towards a man in that there was certainly a degree of sexual harassment. Having considered the matter carefully however the tribunal did not find itself able to say that they treated her less favourably on the ground of her sex than they would have treated a man. We were satisfied, with some regret, that had the applicant been a man whom Mr. Coles and Mr. Reid obviously disliked as much as they disliked the applicant, they would have treated him just as unfavourably as they treated the applicant. The specific nature of the unpleasantness might well have been different but would have been in our view no less unpleasant.

    The EAT reversed the tribunal's decision on grounds that it is unnecessary to consider. The local authority appealed unsuccessfully to the Court of Session.

  187. Lord President Emslie noted, 1986 SC 137, 145, that the parties were at one in submitting that the appeal gave rise to two questions relating to section 1(1)(a): first, was Mrs. Porcelli subjected by the two men to treatment on the ground of her sex (i e because she was a woman) and, secondly, if so, was she treated less favourably than the man with whom she fell to be compared would have been treated by these men? Lord Grieve gave a similar account of the issues in the case but identified three questions. The second was: Was the treatment meted out to the complainer less favourable than would have been meted out to a man in a similar position to her? Lord Grieve's version of the final question was: Was the treatment, or any material part of it, meted out to the complainer less favourable on the ground of her sex? This version clearly derives from the way that the Dean of Faculty had formulated the question on behalf of Mrs. Porcelli: 1986 SC 137, 149. Lord Grieve rather thought that counsel for the education authority would have omitted the words "or any material part of it" from this question: 1986 SC 137, 148. Lord Brand said, 1986 SC 137, 152, that the primary question in the case was: Was the applicant less favourably treated on the ground of her sex than a man would have been treated?

  188. This account of the issues in the appeal to the Court of Session shows that not only counsel for both parties but all three judges agreed: under section1(1)(a) a comparison required to be made, in terms of favourableness, between the treatment meted out to Mrs. Porcelli and the treatment that would have been meted out to a man. The judges all proceeded to deal with the issue on that basis: 1986 SC 137, 146, 150 and 152. Therefore, even if their approach can be criticised, on no view is the decision authority for holding that sex discrimination in the form of sexual harassment can be established without using a male comparator. In so far as the reasoning in later decisions proceeds on the basis that Porcelli is authority for such a proposition, it is misconceived. I respectfully agree with Ward LJ's comments in Smith v Gardner Merchant Ltd [1999] ICR 134, 148.

  189. Although the decision in Porcelli has been influential, it is not satisfactory. The industrial tribunal had duly compared the way the two men had treated Mrs. Porcelli with the way they would have treated a man whom they wished to drive out of the school. Their conclusion was that the men would have treated such a man just as unfavourably as Mrs. Porcelli: while the specific nature of the unpleasantness might well have been different, it would have been no less unpleasant: 1986 SC 137, 144. The First Division could uphold the EAT's decision to reverse this crucial finding by the tribunal only if the finding was perverse or the tribunal had adopted the wrong legal test. They held that the tribunal had adopted the wrong test.

  190. The Lord President explained his decision, which he had reached only after initial hesitation, in this way, at p 146:

    The industrial tribunal reached their decision by finding that Coles' and Reid's treatment of an equally disliked male colleague would have been just as unpleasant. Where they went wrong, however, was in failing to notice that a material part of the campaign against Mrs. Porcelli consisted of 'sexual harassment', a particularly degrading and unacceptable form of treatment which it must be taken to have been the intention of Parliament to restrain. From the 'Reasons' it is to be understood that they were satisfied that this form of treatment - sexual harassment in any form - would not have figured in a campaign by Coles and Reid directed against a man. In this situation the treatment of Mrs. Porcelli fell to be seen as very different in a material respect from that which would have been inflicted on a male colleague, regardless of equality of overall unpleasantness, and that being so it appears to me that upon a proper application of section 1(1)(a) the industrial tribunal ought to have asked themselves whether in that respect Mrs. Porcelli had been treated by Coles (on the ground of her sex) 'less favourably' than he would have treated a man with whom her position fell to be compared. Had they asked themselves that question it is impossible to believe that they would not have answered it in the affirmative.

    The error which the Lord President claimed to detect in the tribunal's approach was their failure to notice that a material part of the men's campaign against Mrs. Porcelli consisted in "sexual harassment". It is a little difficult to accept that the tribunal had failed to notice this aspect of the treatment of Mrs. Porcelli when, in the passage that I have quoted from their reasons, they specifically mentioned that some of the treatment involved "a degree of sexual harassment". The Lord President went on to say that Parliament would have been particularly concerned to stamp out sexual harassment and so the treatment of Mrs. Porcelli was to be seen as very different "in a material respect" from the treatment that would have been meted out to a male colleague. What the Lord President does here is to extract the "sexual harassment" element from the rest of the treatment of Mrs. Porcelli and then go on to consider that element separately. He says that, on a proper application of section 1(1)(a) the tribunal ought to have asked themselves whether "in that respect", viz in respect of the sexual harassment, Mrs. Porcelli had been treated less favourably than a man on the ground of her sex. The Lord President thought that, if they had asked themselves that question, the tribunal would have held that she had indeed been less favourably treated in that respect.

  191. As one would expect, the Lord President does not seek to interfere directly with the tribunal's conclusion, on what was very much a matter for them as an employment jury, that the two men would have treated a man just as unfavourably as Mrs. Porcelli. His approach is more subtle. What he does instead is to hold that the tribunal should have segregated the incidents with a sexual content from the rest and should have considered, separately, the way that the men treated Mrs. Porcelli in those incidents. I regret that I am unable to agree with that approach which depends on reading section 1(1)(a) as if it spoke of the person treating the woman less favourably in a material respect. There is, of course, no warrant for adding any such words and, as Lord Grieve points out, counsel for the education authority had argued against it. But it is only if the provision contained some such words that a tribunal would be justified in dealing separately with the various items making up the alleged discriminator's treatment of the woman. In fact the section simply envisages a comparison between the way the alleged discriminator treats the woman and the way he treats or would treat a man. In the absence of any qualifying words, this must mean that a comparison is to be made between the whole of the alleged discriminator's treatment of the woman and the whole of his treatment of the man.

  192. Any other interpretation leads to unacceptable results, as is evident indeed from the opinion of Lord Grieve. He says, 1986 SC 137, 150:

    The treatment must first be identified and, if necessary, analysed, if it is not clear that it, or any part of it, is sexually orientated. In making the comparison between the treatment accorded to a woman and that accorded to a man in a similar position as required by section 5(3) (in a case where such a direct comparison is possible) if it appears that that accorded to the man is infinitely more cruel than that accorded to the woman (assuming her to be the complainer) that does not answer the question which the provisions of section 1(1)(a) require to be answered. The reason for that is that while the treatment accorded to the woman may be less cruel than that accorded to the man, it may still have been meted out to her on the ground of her sex, and therefore be 'less favourable' in terms of section 1(1)(a).

    Lord Grieve is driven to the conclusion that, even though a man is treated infinitely more cruelly than a woman in the same situation, the tribunal may still require to conclude that, by reason of there being an element of sexually orientated treatment in the case of the woman, she has been less favourably treated than the man. This is a recipe for confusion.

  193. Suppose a man loathes two colleagues, one a man, the other a woman, and decides to drive them out of their place of work. The man subjects the male colleague to a series of assaults which, on each occasion, leave him badly bruised and bleeding. On the other hand, the man considers that a man should not assault a woman and so he subjects the female colleague instead to bouts of gender-specific sexual abuse, no worse than that in Porcelli. The man treats both his male and female colleagues as he does on the ground of their sex. If asked which form of attack they would prefer to undergo if they had a choice, both the male and female colleagues might well say, however, that they would definitely opt for the sexual abuse. And, equally, the members of the tribunal might agree with them. On the approach in Porcelli, however, it would seem that the sexual abuse of the female colleague would not be compared with the assaults but would have to be treated separately. Moreover, since the man would not have used it against the male colleague, the conclusion would be that in this respect he had treated her less favourably on the ground of her sex. Counsel for the intervener, the Secretary of State for Trade and Industry, contemplated, however, that not only might the female colleague have a claim for sex discrimination but the male colleague might also have a claim on the basis that, by beating him up rather than subjecting him to sexual abuse, the man had treated him less favourably than his female colleague on the ground of his sex. I reject an interpretation of section 1(1)(a) which would mean that a tribunal might have to reach such a self-contradictory, not to say absurd, conclusion.

  194. No words should be read into section 1(1)(a). The provision requires the employment tribunal to compare the way the alleged discriminator treats the woman with the way he treats or would treat a man. In any case where discrimination is established, this exercise must by definition involve comparing two forms of treatment which are different, whether in kind or in degree. It also involves the tribunal in evaluating the differences and deciding which form of treatment is less favourable. That is an exercise for the judgment of the tribunal, with its lay members using their experience and acting rather like a jury. Although the exercise may be more complicated, the same applies where the alleged discrimination takes the form of a course of conduct against the woman. The tribunal must compare that course of conduct as a whole with any action, or with the whole of any course of conduct, that the alleged discriminator pursues or would pursue against a man in similar circumstances. On the basis of that comparison the tribunal decides whether the alleged discriminator treats the woman less favourably on the ground of her sex than a man in similar circumstances.

    Disposal of Ms Pearce's second ground of appeal

  195. For these reasons I reject Mr. Emmerson's argument that the tribunal did not require to compare how the pupils treated Ms Pearce with the way that they would have treated a male homosexual teacher in the same circumstances. Such a comparison must be made in all cases under section 1(1)(a) of the 1975 Act.

  196. Once that argument is rejected and it is recognised that the tribunal required to make a comparison, Ms Pearce's second ground of appeal must fail. As Ms Booth submitted, the issue under section 1(1)(a) cannot turn on a minute examination of the precise terms of the abuse with which the pupils assailed Ms Pearce. Obviously, the verbal abuse that the pupils would have directed at a male teacher would have been different, selected as apt for a male rather than a female homosexual. It is unnecessary to specify the kinds of words that would have been used which are, in any event, all too obvious. Quite simply, there is no basis upon which the House could reject the tribunal's conclusion that the pupils' treatment of a male teacher, whatever its precise form, would have been no more favourable than their treatment of Ms Pearce. Her second ground of appeal must accordingly be rejected.

    Disposal of Mr. Macdonald's second ground of appeal

  197. Mr. Macdonald complains of sexual harassment in the intrusive interview which Wing Commander Leeds conducted into his sexual relations with other men. The employment tribunal found, however, that the Wing Commander would have conducted an interview on much the same basis if the officer concerned had been female. That is a conclusion which the House cannot challenge and it is fatal to Mr. Macdonald's claim under this heading. His second ground of appeal must accordingly be rejected also.

    Disposal of the Appeals

  198. Since both Mr. Macdonald's grounds of appeal have been rejected, his appeal must be dismissed.

  199. The rejection of Ms Pearce's first two grounds of appeal means that she has failed to show that the pupils discriminated against her on the ground of her sex. Since the respondent could not be liable unless the pupils had been guilty of sex discrimination, it follows that her appeal must also be dismissed. It is therefore unnecessary to deal with the third ground of appeal. Since the point was argued, however, I can indicate my views shortly.

    THE THIRD ISSUE

    Ms Pearce's third ground of appeal

  200. The employment tribunal indicated that, if they had found that the pupils had discriminated against Ms Pearce on the ground of her sex, they would have held the school liable for subjecting her to that discrimination. The reasoning of the tribunal was criticised by the EAT and by the majority of the Court of Appeal (Judge and Henry LJJ). Having studied the criticisms, especially those in the judgment of Judge LJ, [2001] ICR 198, 214 - 218, paras 44 -62, I find them compelling. Had it been necessary to do so, I should accordingly have dismissed Ms Pearce's appeal on this ground also.

  201. Although neither side raised the point, during the hearing my noble and learned friend Lord Scott of Foscote drew attention to the defective reasoning of the EAT in Burton v De Vere Hotels [1997] ICR 596 on which Ms Pearce's case against the school rests. From what we were told, that decision has been followed in practice and has not hitherto been doubted. The following points are worth noting, however.

  202. The essence of the decision was that an employer could be liable under sections 1(1)(a) and 4(2)(c) of the Racial Discrimination Act 1976 if, having control over his employees, he subjected them to a detriment in the form of racial harassment by a third party. This, the crucial step in the EAT's decision, proceeded on the basis of a concession by the respondents' counsel: [1997] ICR 1, 6, para 16.

  203. Next, the racial discrimination to which the two complainants had been subjected was characterised as racial harassment in the form of racial abuse. Counsel for both parties agreed, by reference to Strathclyde Regional Council v Porcelli, that there was no need to show that a white person would have been treated differently: [1997] ICR 1, 6, paras 18 and 19. For the reasons given above, I should prefer to say that, where a person is subjected to race-specific abuse by someone who is racially motivated, it may well be obvious that the victim was treated less favourably than a white person would have been treated. The comparison requires to be made but res ipsa loquitur: Smith v Gardner Merchant Ltd [1999] ICR 134, 148 per Ward LJ.

  204. Thirdly, counsel for the respondents' concession in Burton, that a person might discriminate against another in terms of section 1(1)(a) when, as a result of his active or passive treatment of the other, the other suffers racial abuse or harassment, is far-reaching. It means that, despite the unambiguous terms of section 1(1)(a), an employer is held to have discriminated against an employee, for the purposes of section 4(2)(b) of the Race Relations Act, even though he himself has not treated the employee less favourably than some other person on racial grounds. I am unable to accept that construction of section 1(1)(a), particularly when Parliament thought it necessary to enact specific provisions, sections 31 and 33, to deal with persons who induce or attempt to induce, or knowingly aid and abet, another to discriminate on racial grounds. Similar provisions are to be found in sections 40 and 42 of the 1975 Act.

  205. In these circumstances I agree with Lord Nicholls of Birkenhead that, for the reasons which he gives, Burton v De Vere Hotels was wrongly decided.


Cases

Shamoon v Chief Constable of the Royal Ulster Constabulary [2003] ICR 337; Smyth v Croft Inns Ltd [1996] IRLR 84; Strathclyde Regional Council v Porcelli [1986] SC 137; [1986] ICR 564; British Telecommunications Plc v Williams [1997] IRLR 668; Smith v Gardner Merchant Ltd [1999] ICR 134; Burton v De Vere Hotels Ltd [1997] ICR 1; Hussain v HM Prison Service (8 May 2002, unreported); Go Kidz Go Ltd v Bourdouane (unreported) (Employment Appeal Tribunal, 10 September 1996); Glasgow City Council v Zafar [1997] 1 WLR 1659; Lustig-Prean v United Kingdom (2000) 29 EHRR 548; Lustig-Prean & Beckett v United Kingdom (1999) 29 EHRR 548; SL v Austria (Application No 45330/99), 9 January 2003; L&V v Austria (Joined Applications Nos 39392/98 and 39829/98); Smith v United Kingdom (2000) 29 EHRR 493; Smith & Grady v United Kingdom (1999) 29 EHRR 49; R v Secretary of State for the Home Department, Ex p Brind [1991] 1 AC 696; T, Petitioner 1997 SLT 724; Fitzpatrick v Sterling Housing Association Ltd [2001] 1 AC 27; R v Lambert [2002] 2 AC 545; R v Kansal (No 2) [2002] 2 AC 69; Pubblico Ministero v Ratti (Case 148/78) [1979] ECR 1629; Webb v EMO Air Cargo (UK) Ltd [1994] ECR I-03567; P v S & Cornwall County Council [1996] ECR I-2143; Grant v South-West Trains Ltd [1998] IRLR 206; D v Kingdom of Sweden [2001] ECR I-04319; R v Ministry of Defence, Ex p Smith [1996] QB 517; James v Eastleigh Borough Council [1990] 2 AC 751; Lesbian & Gay Inequality 2000: the Potential of the Human Rights Act 1998 and the Need for an Equality Act 2002: [2002] EHRLR 603; Pearce [2002] ICR 198; R v Birmingham City Council, Ex p Equal Opportunities Commission [1989] AC 1155; D & the Kingdom of Sweden v Council of the European Union C-122/99 P & C-125/99 P [2001] ECR I-4319 D; Loving v Virginia 388 US 1 (1967); Lawrence & Garner v Texas 41 SW 3d 349 (2001)

Legislations

Sex Discrimination Act 1975: s.1(1)(a), s.5(3), s.41(1)

Equal Treatment Directive (Council Directive 76/207/EEC) [amended by Council Directive 2002/73/EC of 23/9/02]: Art.2 

European Convention on Human Rights: Art.8, Art.14

Race Relations Act 1976: s.1(1)(a)

Authors and other references

Consultation Papers, Towards Equality and Diversity (December 2001)

Equality and Diversity: A Way Ahead (October 2002)

Equality and Diversity: Making it Happen (October 2002)

Richard Brent, Directives: Rights and Remedies in English and Community Law (2001)

David Pannick, Sex Discrimination Law (1975)

Dr Robert Wintermute, "Recognising New Kinds of Direct Sex Discrimination: Transexualism, Sexual Orientation and Dress Codes" [1997] 60 MLR 334

Deakin & Morris, Labour Law 3rd ed, (2001)

AP 3392 Vol 5, leaflet 107

Dr Robert Wintemute, Sexual Orientation and Human Rights (1995)


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