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Lloyds Banking Group deemed to have unfairly dismissed and discriminated against employee who used offensive racial term

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In the recent case of Borg-Neal v Lloyds Banking Group plc ET/2202667/22 an Employment Tribunal upheld an employee's claims following his dismissal for using an offensive racial term during a race education training session.

The employee had worked for the banking group for a long time and had a clean disciplinary record. However, during 2021 the employer conducted a session entitled, ‘Race Education for Line Managers.’ During the session the employee asked, ‘As a line manager, if you hear someone from an ethnic minority use a word that might be offensive if used by someone not within that minority, how would you deal with it?’ After a short pause he added, ‘The most common example being the use of the N word in the black community’ (save that he said the full word). The evidence suggested that the trainer expressed offence at the employee's use of the full word and that the employee immediately apologised.

During the disciplinary investigation the employer did not interview any of the three trainers and only interviewed a limited number of those present, even though 100 employees had attended the session.

The employer dismissed the employee for gross misconduct. In upholding the claim for unfair dismissal, the Tribunal found that the employee had asked a relevant question with no intention to offend, and thus that viewing this as gross misconduct was unreasonable, even if the language was misjudged. The Tribunal also found that a more thorough investigation should have been undertaken.

The employee also argued that his use of the "n-word" arose from his dyslexia, which fell within the definition of a disability under the Equality Act 2010. The medical evidence suggested that the employee experienced ‘difficulty in posing questions in clear and succinct ways often requiring verbal iteration when in meetings.’ Further evidence suggested that the employee tended to make oral communication errors. The Tribunal found that the incident concerned fitted this profile. The Claimant had asked a complex question, with the "n-word" in his mind because he had heard it in rap songs. When the trainer did not respond during the pause he gave an explicit example. This was consistent with the medical evidence that he would was prone to making this sort of mistake.

As such the Tribunal found that the Claimant's misjudged use of language arose from his disability. An employer will not be liable for discrimination if dismissal was justified in the circumstances. The Tribunal found that dismissal was not justified due to the profound impact on the Claimant of dismissal and given that the employer could have achieved it's aims in other ways, for example by providing further training.

Employers may wish to take a zero-tolerance approach to the use of offensive language, however any failure to place weight on mitigating factors such as the context, the individual's motivation, length of service, and the impact of a disability, could lead to liability in an Employment Tribunal. Our team of solicitors can guide you through a disciplinary investigation and process to ensure legal compliance.


If you need guidance on any of the above matters, we are here to help.  Please do not hesitate to contact Martin Cornforth on 01636 558343, or email: