The government is set to reintroduce employer liability for third-party harassment through clause 20 of the Employment Rights Bill, marking a significant development in workplace law.
Under the proposed reforms, employers could be held responsible if employees are harassed by individuals who are not company employees or agents, such as clients, contractors, or members of the public.
These changes place a clear responsibility on employers to take proactive steps in preventing harassment, responding effectively when incidents occur, and maintaining a safe workplace for all staff.
For employers, this represents a legal obligation and an opportunity to reinforce a culture of respect and safety in the workplace.
We’ll outline what employers need to know about these reforms below, including the current third-party harassment policy, what’s changing, and the steps employers should take to maintain compliance.
The Current Third-Party Harassment Policy
The current legal framework for third-party harassment in the workplace is somewhat nuanced.
The concept was initially introduced under the Equality Act 2010, which made employers liable if harassment by a third party occurred on multiple occasions and the employer failed to act. However, these provisions were repealed in 2013 due to concerns about excessive liability.
Since then, there has been no standalone legal liability for employers when harassment is perpetrated by clients, customers, or other third parties. Employers are not directly liable in tribunals for third-party harassment claims.
However, the picture changed slightly with the preventative duty on sexual harassment introduced last year. The Equality and Human Rights Commission (EHRC) clarified that this duty does include taking reasonable steps to prevent sexual harassment by third parties.
What Does This Mean In Practice?
In practice, this means that while an employee cannot bring a separate tribunal claim solely based on harassment by a third party, employers could still face enforcement action by the EHRC if they fail to take reasonable measures to prevent such harassment.
Additionally, if a claim of sexual harassment is successful, an employer’s inaction regarding third-party harassment could result in increased compensation awarded to the employee.
The current policy encourages employers to take proactive steps to protect employees from harassment, including incidents involving external parties. However, it stops short of imposing full legal liability on employers for every instance of third-party harassment.
What’s Changing Under The Employment Rights Bill?
Previous rules around sexual harassment by third parties were introduced with the preventative duty under the Equality Act and updated guidance last year. Under that framework, employers were expected to take “reasonable steps” to prevent sexual harassment, including by third parties.
Failure to do so could lead to enforcement action by the Equality and Human Rights Commission (EHRC) and potentially higher compensation awards for employees if a claim were successful. However, employees could not bring a separate tribunal claim solely based on harassment by a third party.
The Employment Rights Bill proposes to go further. Employers would now be liable if they fail to take “all reasonable steps” to prevent harassment by third parties.
This new duty allows employees to bring tribunal claims for harassment in the workplace based on all protected characteristics, including sexual harassment, race, disability, and sexuality.
Strengthened Protections for Employees
Importantly, the Bill also recognises that a disclosure about sexual harassment will be treated as a protected disclosure under whistleblowing legislation.
This means employees who report harassment are legally protected from detriment or dismissal, providing additional safeguards and reinforcing the employer’s duty to take complaints seriously.
While what counts as “all reasonable steps” will depend on factors such as an employer’s size, resources, and the nature of the workplace, this shift represents a move from an enforcement-focused preventative duty to a direct liability regime, significantly strengthening employee protections against both internal and third-party harassment.
What Employers Should Do Now
The Employment Rights Bill introduces stronger protections against sexual and third-party harassment, making it essential for employers to act proactively.
- Begin by assessing risks where employees interact with clients, contractors, or the public, and update policies to explicitly cover third-party harassment. Staff training is also essential to ensure employees and managers can recognise, prevent, and respond effectively to harassment.
- All disclosures of sexual harassment should be treated as protected whistleblowing disclosures, with employees assured they are legally safeguarded from detriment or dismissal.
- Employers should ensure contracts with clients, contractors, and service providers include clear clauses prohibiting harassment and setting out expectations for workplace behaviour.
- Beyond policies and training, employers should actively promote a workplace culture where harassment is not tolerated, and all staff feel empowered to speak up.
Proactively addressing these obligations demonstrates compliance with the Employment Rights Bill and helps mitigate potential legal exposure.
How We Can Help
Navigating changes around third-party harassment introduced by the Employment Rights Bill can be complex.
At Harding Evans, our specialist employment law team works closely with organisations across Wales and the UK, providing practical guidance on compliance and risk management.
Our team can provide tailored solutions to protect your employees and safeguard your organisation.
For expert guidance on how the Employment Rights Bill may impact your business, contact Harding Evans today on 01633 244233 or via email at wilded@hevans.com.
