I reported in May last year that the Employment Appeal Tribunal had held in Allen v. Hounga and Another that, whilst an employee working under an illegal contract is barred from pursuing an unfair dismissal claim, that same illegality did not prevent the employee from pursuing a race discrimination claim against their employer. The Court of Appeal has now issued its judgment on the case.
Miss Hounga, a Nigerian national, was employed by a couple to work as their live-in housekeeper in the UK. She colluded with her employer to provide false information in order to obtain immigration permission to work in the UK. She continued to work for her employer following the expiry of her visa. After her eventual dismissal she claimed unfair dismissal and race discrimination.
The Court of Appeal has held that Miss Hounga was prevented by the illegality of her employment from bringing her discrimination claim. Whilst the EAT had distinguished Miss Hounga’s case from a previous case in which the employee had lied about his immigration status, without his employer’s knowledge, and was barred from raising a discrimination claim, the Court of Appeal took a different approach.
The Court of Appeal considered that the only difference between Miss Hounga’s case and the previous case was that in Miss Hounga’s the employer was culpable. In both cases the employment contract was illegal from its inception. The Court placed less emphasis on the employer’s involvement in the illegality and considered that the correct question to ask was whether the discrimination claim was inextricably linked to the illegality? If it was, allowing the employee to rely upon her own illegal actions in furtherance of a discrimination claim would condone the illegality, something the Court could not do.
This was a difficult case in which the employee had been very poorly treated by her employer, who was well aware of the illegal nature of the employment relationship. Whilst the Court clearly had sympathy for Miss Hounga, illegality is a strict principle of policy and Miss Hounga was aware that her actions were wrong. Accordingly, she was barred from pursuing a discrimination claim.
What does this mean for employers?
It remains the case that employees working under an illegal contract of employment cannot pursue unfair dismissal claims.
In terms of discrimination claims, the Court of Appeal’s decision confirms that the issue is whether the discrimination claim is inextricably linked with the illegality of the employment relationship. If it is, the employee will be barred from pursuing a discrimination claim. The Court’s focus will be on the employee’s involvement in the illegality, as opposed to the employer’s. It is likely that, following this decision, the majority of illegal workers (knowingly working illegally) will be equally barred from raising discrimination claims on this basis