Borg-Neal v Lloyds Bank: The Lloyds Bank Unfair Dismissal Case
Updated: Oct 23
Borg-Neal v Lloyds Bank is a well-known recent case in employment law. Its full title is Borg-Neal v Lloyds Banking Group PLC, case number 2202667/2022. Carl Borg-Neal, a long-serving manager, brought claims for unfair dismissal and disability discrimination. He was dismissed after using the full N word during a race education training session. The case shows how much context and process matter when an employer deals with offensive language.
This article sums up the case as reported. It also explains the legal ideas behind it. It is general information, not legal advice. For the exact findings, read the tribunal's written judgment.
The tribunal's reserved judgment on liability, dated 4 August 2023, and its later remedy judgment are published on GOV.UK.
Background of Borg-Neal v Lloyds Bank
Carl Borg-Neal worked at Lloyds Banking Group PLC for over 15 years. He had a clean disciplinary record. The tribunal found he had been employed continuously since May 2004. On 16 July 2021, he attended an online race education training session for line managers. The session was discussing intent and effect.
He asked how a line manager should deal with a particular situation. What if someone from an ethnic minority used a word that might be considered offensive if used by someone outside that group? He added that the most common example was use of the N word in the black community. He said the full word rather than the abbreviation.
He apologised at once and did not repeat the word. The bank accepted that he meant no malice and that the question was valid. It still dismissed him for gross misconduct in December 2021. His appeal was not upheld, and he took his case to an employment tribunal.
Lloyds Bank unfair dismissal: key legal issues
The tribunal looked at several important points:
Unfair dismissal: whether dismissing him for gross misconduct was within the range of reasonable responses open to the bank.
Disability discrimination: he has dyslexia. He said it affected how he phrased his question, and he claimed both a failure to make reasonable adjustments and discrimination arising from disability.
Race discrimination: during the hearing he was allowed to add a claim of direct race discrimination. He said he was dismissed because he was white.
Intent and effect: the training session itself was about the difference between what a person means and the effect of their words.
Intent and effect are different in discrimination law. A person can be treated unlawfully even if the employer meant no harm.
The tribunal's findings
The tribunal's decision was unanimous:
Unfair dismissal upheld: a reasonable employer could treat use of the word as misconduct, but not as gross misconduct on these particular facts.
Discrimination arising from disability upheld: dismissing him, and not upholding his appeal, was discrimination arising from his dyslexia. The tribunal found it was a strong factor in how he expressed himself.
Reasonable adjustments claim not upheld.
Direct race discrimination claim not upheld: the tribunal did not accept that his race was a substantial part of the reason for dismissal.
The tribunal stressed that the full N word should always be avoided in a professional setting. It said simply hearing it is likely to be intensely painful and shocking for black people. It also commended the bank's race education training. Its finding was narrower. In the very unusual circumstances of this case, no reasonable employer would have dismissed him. The bank could have given a warning and more training, as he had suggested himself.
How unfair dismissal law works
It helps to know the basic law. In England and Wales, an employer needs a fair reason to dismiss. Section 98 of the Employment Rights Act 1996 lists the fair reasons. They include conduct, capability and redundancy.
A fair reason is not enough. The employer must also act reasonably. That means a fair process. The employer should investigate properly and let the employee respond. A poor process can make a dismissal unfair.
An ordinary unfair dismissal claim usually needs a minimum period of service. Check the current rule on GOV.UK. Discrimination claims need no minimum service.
Disability discrimination and reasonable adjustments
The Equality Act 2010 protects workers from discrimination because of disability and race. Employers must also make reasonable adjustments for disabled staff. This means taking reasonable steps to remove work disadvantages.
A dismissal can be both unfair and discriminatory. An employee can then bring more than one claim. Our guide to workplace discrimination explains the main types.
Impact on Lloyds Bank and the banking sector
For disability discrimination under the Equality Act 2010, the tribunal awarded the following sums, as reported:
Past loss of earnings: £82,120.32.
Loss of Lloyds shares: £500.
Past loss of beneficial staff mortgage: £1,200.
Prescription fees: £237.82.
Chiropractor fees: £558.
Past loss of pension: £13,937.17, or £14,634.03 with the 5% Acas uplift.
The tribunal also awarded sums for future loss from 6 December 2023:
Future loss of earnings, after an Ogden adjustment: £231,827.85.
Future loss of pension, after an Ogden adjustment: £51,392.98.
Future loss of death in service benefit: £4,712.50.
Future loss of private health insurance: £7,068.75.
Future prescription fees: £110.17.
The total future loss with a 5% Acas uplift was £309,867.86. The tribunal also awarded £15,000 for injury to feelings, £3,000 for aggravated damages and £23,000 for personal injury. The total for these, with a 5% Acas uplift, was £43,050.
For the unfair dismissal claim itself, the tribunal made a basic award of £13,600. It awarded a further £3,150 for loss of statutory rights and loss of a long notice period, including the uplift. Interest was also awarded on some sums.
An Acas uplift can apply when a party ignores the Acas Code of Practice on disciplinary and grievance procedures. The tribunal can raise an award by up to 25%. Our guides on compensation claims for unfair dismissal and employment tribunal compensation limits give more detail.
What employers can learn
A dismissal like the one Mr Borg-Neal faced is a serious matter for any employer. The case reminds companies to treat all staff fairly. It shows that a company can cause harm even when it does not intend to discriminate. Employers should:
Handle complaints carefully and follow their own policies.
Provide proper racial awareness training and race education training.
Make sure communication is clear and treatment is fair for everyone, especially staff from ethnic minorities and the black community.
Take disability adjustments seriously and record what they have done.
What employees can learn
The case shows that employees can take complaints to an employment tribunal. It also shows why a clean record and good documents matter. Keep copies of your complaints, replies and meeting notes. Challenge offensive language and discrimination. Use the grievance process.
If a claim is possible, time limits are short. A tribunal claim must normally be brought within three months, less one day. You usually need to contact Acas for early conciliation first. Our guide to employment tribunal claim steps explains the process.
Conclusion: a wake-up call for employers
For companies like Lloyds Banking Group, the case is a push towards a fairer workplace. By learning from it, businesses can build a place where all staff feel respected.
If you face problems at work, speak to an employment law specialist. You can also contact Acas for free, impartial advice.
