Is Your Business Prepared for the New Worker Protection Act 2023? Discover the 7Ps for Compliance and Prevention

The new legislation, combined with updated guidance from the Equality and Human Rights Commission (the "EHRC"), imposes a new positive duty on employers to prevent sexual harassment in the workplace. This is a significant shift from the current statutory defence; while it is no longer enough for employers to respond to incidents after they occur - employers must demonstrate they are taking reasonable steps to prevent all sexual harassment in advance.

Sexual harassment is defined as unwanted conduct of a sexual nature which has the purpose or effect of either violating the complainant’s dignity or creating an intimidating, hostile, degrading, humiliating, or offensive environment for the complainant.

Sexual harassment is prohibited under the Equality Act 2010, but employers had a “statutory defence” to a harassment claim if they could show they have taken all reasonable steps to prevent the harassment.

Whilst the WPA does not expressly reference employer obligations regarding third-party harassment, such that an employer will not be liable for the acts of a third party, the EHRC technical guidance on sexual harassment and harassment at work has made clear that an employer will have breached its preventative duty if it fails to anticipate the risk of and takes steps to prevent third-party harassment.

It should also be noted that clause 16 of the new Employment Bill sets out an express duty to require employers to take ‘all reasonable steps’ to prevent any form of third-party harassment such that individuals will be able to bring a claim to the employment tribunal where the employer has failed in this duty. Whilst there is currently no standalone claim, this express duty will likely become legislation in due course, so employers should take preventative steps.

Under the new legislation, the reactive duty will remain, but employers will also be required to demonstrate that they have taken reasonable steps to prevent sexual harassment of employees in the course of their employment.

While this may seem similar to the reactive statutory defence above, the key difference is that instead of defending a specific instance of harassment, employers will additionally have to show that they have taken reasonable steps to prevent workplace sexual harassment in general, including from third parties, such as customers, clients, or contractors. The preventative duty should be considered as an anticipatory duty on employers to assess the risk of harassment in their workplace.

The WPA does not define the ‘reasonable steps’, and the EHRC has also stated that there is no set checklist. Instead, the EHRC advises that what constitutes reasonable steps will be based on factors such as the employer's size and resources, the nature of the working environment, the sector they operate in, and the specific risks present in the workplace. Employers will be expected to assess the risks of sexual harassment proactively, consider measures to mitigate these risks, decide which steps are reasonable to implement, and then put those measures into action.

There is no one-size-fits-all approach to complying with the duty, and reasonable steps will very much depend on the industry and the facts and circumstances of the individual employer. As such, they will be judged on a case-by-case basis.

To assist employers in understanding and complying with the new duty, the EHRC has published a revised version of its technical guidance on sexual harassment and harassment at work. The EHRC has also produced a helpful guide that sets out the steps that all employers should take, irrespective of size or industry, to prevent harassment. While this guidance is not legally binding, employers are advised to consider it as best practice, given the risk of increased financial penalties arising from a successful claim in the employment tribunal.

• Policy: Employers should ensure they have an effective anti-harassment policy that clearly outlines who is protected and makes it explicit that sexual harassment is unlawful and will not be tolerated. This policy should be communicated to all staff.
• Engagement: Engage with staff to understand and identify potential issues through effective one-to-one meetings, surveys, and exit interviews.
• Risk assessments: Risk assessments will be critical to helping organisations comply with a proactive and preventative duty. The risk assessment should identify factors that might increase the likelihood of sexual harassment, such as power imbalances, lack of diversity, night shifts, lone working, or alcohol consumption at work events, and then consider what steps may be taken to minimise the risk of sexual harassment.
• Reporting: Implement a system to report claims of sexual harassment. Consider means to make anonymous submissions. Educate staff on acceptable behaviour, how to identify harassment, and ensure all staff know how to report it if they experience or witness it. Keep confidential records to track patterns and respond effectively.
• Provide training: Provide training to all staff, including managers, on recognizing and addressing harassment. Refresher sessions should be scheduled regularly and updated based on any issues highlighted in risk assessments or working practices. Review the effectiveness of the training provided.
• Handle complaints effectively: When harassment complaints are made, take immediate action, respect confidentiality, and protect the complainant from further harassment or victimisation.
• Prevent third-party harassment: Prevent third-party harassment by undertaking risk assessments, developing codes of conduct for interactions with third parties, establishing clear reporting mechanisms, and monitoring any high-risk environments.
• Monitor and evaluate: Regularly review policies, training, and complaint handling to ensure effectiveness. Anonymous surveys and lessons-learned sessions after complaints can help improve systems and indicate whether additional or alternative action is required. Involve employees to ensure workplace safety and compliance with the preventative duty.

Whilst there is no freestanding complaint of a failure to comply with these strengthened protections, a breach of this new duty could result in substantial financial penalties, including a potential 25% uplift on any employment tribunal compensation awarded in a successful harassment claim. Given the uncapped damages for discrimination claims and injury to feelings awards, the financial liability of employers failing to understand and act on the WPA's new obligations could be significant.

In awarding an uplift in compensation, the employment tribunal will consider whether the preventative duty has been breached, the steps taken by the employer to comply with it, and whether any previous complaints have been made.

In addition to the financial penalties awarded by the Employment Tribunal, the EHRC will also be able to take enforcement action against organisations that breach the new duties. The EHRC will have a dedicated enforcement team that will have the power to conduct investigations and enter into a section 23 agreement with organisations to protect their staff from sexual harassment.

Employers must also be mindful of the reputational damage of an employment tribunal claim and/or public EHRC investigation.

Employers must undertake risk assessments, revise their harassment policies now, and ensure that these are tailored to their industry, size, and resources.

Employers should plan regular staff training on recognising and preventing sexual harassment in the workplace and implement robust reporting mechanisms that provide employees with a safe and clear way to raise concerns.

Whilst employers must adopt a proactive approach, they should also be reminded that the EHRC does not advise huge leaps — it advises reasonable steps proportionate to the individual organization and its available resources. By following the practical guidance now, employers will not only demonstrate compliance with the new duty. Still, they will also help identify potential hazards before they escalate, creating a safer working environment for all staff.