In Djalo v Secretary of State for Justice [2025] EAT 67, the Employment Appeal Tribunal (EAT) upheld the Employment Tribunal’s decision to strike out a race discrimination claim brought by a contract cleaner. The case highlights the legal limitations faced by outsourced workers seeking equal pay with directly employed staff, particularly in light of the Court of Appeal’s decision in Royal Parks Ltd v Boohene [2024] EWCA Civ 583.
Background
Ms Djalo is employed by a private facilities management company, OCS Limited (“OCS”). OCS provides services to the Ministry of Justice (“MOJ”) in accordance with an agreement between the two organisations (the “Contract”). Ms Djalo works as a cleaner at the MOJ’s Petty France site, where she has worked since 2009.
Ms Djalo asserted that, as a result of her being paid less than those staff directly employed by the MOJ who were performing comparable work, the MOJ had indirectly discriminated against her. She argued that the MOJ had applied a provision, criterion or practice (“PCP”) that resulted in lower pay for contract workers. She asserted that this disparity disproportionately affected black and minority ethnic (“BME”) staff. She also claimed that the MOJ had the contractual power to uplift her pay to the London Living Wage (“LLW”) under clause 60.1(17) of the Contract.
Tribunal and Appeal Decisions
The Employment Tribunal struck out the claim, finding that sections 19 and 41 of the Equality Act 2010 (“EqA”) did not permit a contract worker to bring a discrimination claim against a principal based on differences in pay with the principal’s own employees.
After Ms Djalo’s appeal was allowed to proceed to a full hearing, but before that hearing took place, the Court of Appeal (“CA”) handed down its judgment in the case of The Royal Parks Ltd v Boohene and others [2024] EWCA Civ 583 (“Royal Parks”). That judgment confirmed that section 41 EqA did not allow for a principal to face a discrimination claim which related to pay under a contract worker’s contract with their own employer.
Ms Djalo argued that the MOJ’s contractual power to uplift pay distinguished her case from Royal Parks. She also relied on the EU Race Equality Directive (No. 2000/43), and asserted that the single source principle (as outlined in Lawrence v Regent Office Care Ltd and others (Case C-320/00) [2003] ICR 1092) should be applied.
However, the EAT rejected these arguments. It held that:
- The MOJ’s alleged contractual power to uplift pay could not be established. Even if this had been established, it would not form a material distinction from Royal Parks or permit this case to be brought into the scope of section 41 EqA.
- On the above basis, the single source principle did not apply here.
- Ms Djalo could not satisfy the criteria for a section 19 EqA claim, though this was unnecessary in any event given the EAT’s findings related to section 41 EqA.
- With regards to the European Convention on Human Rights (ECHR), the claim did not fall within the ambit of Article 8 or Article 1 of Protocol 1 of the and thus Article 14 (protection from discrimination) was not engaged.
Key Takeaways
This case, following closely on the heels of Royal Parks, reaffirms the narrow scope of section 41 EqA and illustrates the legal hurdles faced by outsourced workers seeking parity with directly employed staff.
Though the EAT did not consider the single source argument or Article 14 to be applicable on the facts of this case, this may form the basis of future appeals.
