In Sheffield City Council v Norouzi, the EAT ruled that the Council was liable for acts of racial harassment carried out by a child in a care home against one of its employees because it knew harassment was occurring but failed to intervene.

Mr Norouzi is of Iranian origin and employed as a residential social worker in a home for troubled young children. One child was regularly offensive to him on racial grounds. She told him to go back to his own country and mocked and mimicked his accent. He became increasingly upset by her behaviour. Management were aware of the situation, but although one intervention took place, there were no further attempts to deal with the problem and the racist behaviour was allowed to persist.

A tribunal upheld Mr Norouzi’s claim of harassment under the Race Relations Act, noting the High Court’s decision in R (Equal Opportunities Commission (EOC)) v Secretary of State for Trade and Industry [2007] IRLR 327, which held that an employer could be held liable for sexual harassment where it knows there is a continuing course of third party harassment but does nothing to stop it. The EAT upheld the tribunal’s decision. While the Council were not liable for the actions of children in its care, the principles in the EOC decision applied equally to racial harassment claims. The Council were liable, because they were aware of the racial abuse but had not done enough to protect Mr Norouzi.

While S.40 of the Equality Act 2010 now provides that employers are liable if they knowingly fail to protect their employees from repetitive harassment by third parties, the Government has announced that it will consult on “this unworkable requirement” to determine whether it should be abolished. This case shows that even if the legislation is repealed, claims for third party harassment may still succeed.