Charities and the Equality Act 2010.pdf348kB - Farrer & Co
Charities and the Equality Act 2010.pdf348kB - Farrer & Co
Charities and the Equality Act 2010.pdf348kB - Farrer & Co
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Page 2<br />
His view is that this means that all existing charitable instrument exemptions must be interpreted (<strong>and</strong> should<br />
have been interpreted since <strong>the</strong> implementation of <strong>the</strong> Human Rights <strong>Act</strong> 1998) as if <strong>the</strong>y contained <strong>the</strong> additional<br />
requirement set out in <strong>the</strong> SDA.<br />
The <strong>Act</strong><br />
The charitable instrument exemption in section 193 of <strong>the</strong> <strong>Act</strong> is worded as follows:<br />
(1) A person does not contravene this <strong>Act</strong> only by restricting <strong>the</strong> provision of benefits to persons who share a protected<br />
characteristic if –<br />
(a) <strong>the</strong> person acts in pursuance of a charitable instrument, <strong>and</strong><br />
(b) <strong>the</strong> provision of <strong>the</strong> benefits is within subsection (2).<br />
(2) The provision of benefits is within this subsection if it is –<br />
(a) a proportionate means of achieving a legitimate aim, or<br />
(b) for <strong>the</strong> purpose of preventing or compensating for a disadvantage linked to <strong>the</strong> protected characteristic.<br />
Once <strong>the</strong> <strong>Act</strong> is implemented, any charity that restricts its beneficiaries by reference to any of <strong>the</strong> protected grounds<br />
will need to show that it meets <strong>the</strong> additional test in paragraph (2) above.<br />
What this means for charities<br />
The effect of this test, derived from European law, is unclear <strong>and</strong> it is difficult to predict with certainty how <strong>the</strong> new<br />
exemption will be interpreted by <strong>the</strong> British courts. The concept of a ‘legitimate aim’ is not defined by <strong>the</strong> <strong>Act</strong>, but<br />
<strong>the</strong> aim must be legal, must not be discriminatory in itself <strong>and</strong> must represent a real, objective consideration. The<br />
means chosen must be capable of achieving <strong>the</strong> stated aim. Fur<strong>the</strong>r, charities will need to show that any restriction is<br />
necessary <strong>and</strong> that less discriminatory measures could not achieve that same aim. It is likely that statistical evidence<br />
will be required to support such arguments.<br />
We are aware that <strong>the</strong>re are a number of charities that currently rely, not always consciously, upon <strong>the</strong> existing<br />
exemptions. This includes charities set up to benefit individuals of a particular religion or nationality, charities that<br />
provide targeted scholarships <strong>and</strong> many service providing charities. The change may also affect grant-makers whose<br />
grant criteria refer to protected characteristics <strong>and</strong> charities that receive or have received donations with restrictions<br />
based on protected characteristics. It may also have an impact, not only on charities already registered with objects<br />
restricted on protected grounds, but also charities applying for registration with <strong>the</strong> Charity <strong>Co</strong>mmission in <strong>the</strong> future.<br />
Affected charities will need to be able to show whe<strong>the</strong>r <strong>and</strong> how <strong>the</strong>y can meet <strong>and</strong> evidence <strong>the</strong> additional<br />
requirements in <strong>the</strong> <strong>Act</strong>, or potentially consider changes to <strong>the</strong>ir governing documents, fundraising documents, grant<br />
criteria or o<strong>the</strong>r internal procedures.<br />
The need for guidance<br />
The Equalities <strong>and</strong> Human Rights <strong>Co</strong>mmission (“EHRC”) recently published a number of draft statutory codes of<br />
practice <strong>and</strong> non-statutory guidance on <strong>the</strong> <strong>Act</strong> for consultation (please see our <strong>Equality</strong> <strong>Act</strong> E-Briefing). Those<br />
drafts, however, provide little guidance on <strong>the</strong> proposed charitable instrument exemption.<br />
There is <strong>the</strong>refore a clear need for guidance on <strong>the</strong> new provisions within <strong>the</strong> sector, whe<strong>the</strong>r from <strong>the</strong> EHRC or<br />
ano<strong>the</strong>r body such as <strong>the</strong> Charity <strong>Co</strong>mmission.<br />
To this end we led a Charity Law Association working group on this issue, which has now responded to <strong>the</strong> EHRC<br />
consultation to try to make sure that adequate guidance is available both to our clients <strong>and</strong> <strong>the</strong> sector as a whole.<br />
The EHRC has now published a timeline for publication of <strong>the</strong> final guidance <strong>and</strong> for codes of practice to be laid before<br />
Parliament. That timeline is summarised at <strong>the</strong> end of this article. We will be reviewing <strong>the</strong> final guidance <strong>and</strong> codes of<br />
practice once available, <strong>and</strong> will publish a fur<strong>the</strong>r update in due course.<br />
Telephone: +44 (0)20 3375 7000 Email: enquiries@farrer.co.uk Web: www.farrer.co.uk