An update on third party harassment under the Employment Rights Bill

One of the changes being introduced by the Employment Rights Bill (ERB) is to make employers liable for third party harassment of employees in the course of their employment. The obligation is intended to protect employees from harassment by anyone who does not work for, and is not an agent of, the same employer (this will include, for example, customers, contractors and members of the public).

The third party harassment provisions are not without their critics, however, with concerns being raised that they could potentially infringe on human rights, such as freedom of expression. In this blog, we discuss the Government’s recent response to such concerns. We also examine a recent case considering how employers can avoid liability for discrimination by taking “all reasonable steps” to prevent it.

For details about other changes being introduced by the ERB, see our summary article here. 

The current position on third party harassment in the workplace

The concept of third party harassment was originally introduced in the Equality Act 2010 (Equality Act). The Act made employers liable for harassment of an employee by a third party, but only where the employer knew the harassment had occurred on at least two previous occasions and had failed to take reasonable steps to prevent it from happening again. However, these provisions were repealed in 2013 amid concerns that they imposed excessive liability on employers. 

In 2019, the then Conservative government attempted to reintroduce liability for third party harassment. However, the proposal was dropped due to concerns about its potential impact on free speech and the risk of costly litigation for employers. Opponents argued the measures could have a "chilling effect" on conversations in public spaces, where overheard remarks might be considered harassment.

The preventative duty on sexual harassment introduced last October (see here) did not change the position on employer liability for third party harassment. However, the Equality and Human Rights Commission was clear in its technical guidance that the preventative duty included an obligation on employers to prevent sexual harassment by third parties.

The Employment Rights Bill – Government responds to concerns

The ERB introduces employer liability for third party harassment, specifying that an employer will be judged to have permitted harassment of an employee if it fails to take “all reasonable steps” to prevent it. We consider the all reasonable steps defence further below. Third party harassment will apply to all types of harassment, not just sexual harassment. 

Recently, the Chair of the Joint Committee on Human Rights (JCHR) wrote to the Secretary of State for Business and Trade to ask whether sufficient safeguards had been put in place regarding third party harassment to protect the freedom of expression under Article 10 of the European Convention of Human Rights.  

The Government responded to the JCHR’s questions as follows:

Why has the Government not included a carve out for “overheard opinions” (ie where the harassment involved a conversation in which the employee was not a participant)?

The Government does not believe such a carve out is necessary, because the clause on third party harassment already protects freedom of expression and ensures impractical burdens are not placed on employers. In particular, the Government emphasised that the courts and tribunals already balance competing rights, including the freedom of expression, when determining the effect of unwanted conduct under the Equality Act.

Importantly, the Government also clarified that:

• Employers can only do what is reasonable. The steps an employer can reasonably take in respect of third parties will be more limited than in respect of their employees (and this will be taken account of by the Employment Tribunal).
• Employers are not expected to stop all harassment from ever occurring to their employees, or to intervene directly in all incidents.
• Employers will not be penalised for failing to take unworkable or impractical steps.

Why has the Government not adopted the same “three strikes” policy contained in the original Equality Act provisions?

The Government confirmed that a one-off incident is less likely to constitute harassment compared to ongoing acts, making a “three strikes” rule unnecessary.

The Government also took the view that the original rule was confusing and acted as a barrier to redress (evidenced by the fact only two cases were brought under it).

Why has the Government not included a power to define what reasonable steps would be for the purposes of third party harassment?

The Government stated it has limited this power to sexual harassment, in line with the emphasis the Equality Act already places on preventing sexual harassment. Even then, steps will only be mandated when evidence shows it to be necessary.

Why has the Government not addressed the interaction between third party harassment and the preventative duty on sexual harassment?

The Government’s position is that the preventative duty will apply to third party sexual harassment in the same way as it applies to employee-on-employee harassment. An employee will be able to bring a third party harassment claim against their employer and, if successful in a sexual harassment claim, a tribunal must consider if the preventative duty as also breached.

“All reasonable steps” in a modern employment context

Under the Employment Rights Bill, employers will be liable for third party harassment unless they can demonstrate they took all reasonable steps to prevent it.

This wording echoes the current statutory defence in the Equality Act, under which an employer can defend a claim of harassment or discrimination if they can show they took all reasonable steps to prevent the employee from carrying out the discriminatory act complained about.

In a recent case – Campbell v Sheffield Teaching Hospitals NHS Foundation Trust – the Employment Appeal Tribunal (EAT) provided helpful guidance on the two-stage approach to determining if the statutory defence is made out:

1. What steps were taken?
2. Were there any further steps that were reasonably practicable that should have been taken and could have been taken by the respondent?

Although these cases inevitably turn on their facts, in this case the EAT found that the employer had done enough to prove the defence. It was particularly relevant that mandatory equality and diversity training had been delivered just days before the incident complained about, and that expectations about behaviour were regularly reinforced via policies, posters and appraisal meetings. This is a reassuring case for employers, highlighting the importance of both implementing and continuously reinforcing comprehensive measures to prevent harassment, since doing so can significantly strengthen an employer’s ability to rely on the statutory defence to protect against liability.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, May 2025