Positive Action and Social Housing

07 Jul 2020

Housing, Public Law and Judicial Review

On 29 and 30 June 2020 the Supreme Court heard the appeal in the case of R (on the application of Z and another) v Hackney London Borough Council and another.

The case concerns a challenge to the allocation policy of Agudas Israel Housing Association, on the basis that their policy directly discriminates on the ground of religion and/or race. Agudas Israel lets its properties solely to members of the Orthodox Jewish Community.

The London Borough of Hackney has nomination rights to Agudas Israel’s properties, and regards them as making an important contribution towards improving the housing conditions of a particularly vulnerable minority within its area.

Hackney’s submissions before the Supreme Court were focused on two issues:
(a) The scope of permissible positive action, i.e. favourable treatment of a disadvantaged minority group, under section 158, Equality Act 2010; and
(b) Upholding the approach to proportionality taken by the Divisional Court.

The positive action arguments centred on the relevance of a line of CJEU case law dealing with national provisions favouring women in respect of the recruitment and promotion of employees, which severely restrict the scope of permissible positive action in that context.

The submission on behalf of Hackney was that the above line of case law was limited to the context of recruitment/promotion and had no application to social housing. CJEU authorities such as the decision of the Grand Chamber in Cresco Investigation GmbH v Achatzi [2019] 2 CMLR 20 rather showed that in other contexts an ordinary proportionality assessment was required when determining whether positive action was justified.

That proportionality exercise had been properly carried out by the Divisional Court, who were entitled to take into account in particular that Agudas Israel’s lettings amounted on average to less than 1% of annual lettings under Hackney’s allocation scheme.

This is the first time that the Supreme Court has considered positive action, as well as the charity exemption provided for by section 193 of the Equality Act 2010. The panel of Lord Reed PSC, Lord Kerr, Lady Arden, Lord Kitchin and Lord Sales JJSC reserved their judgment.

Matt Hutchings QC acted successfully for the London Borough of Hackney before the Divisional Court ([2019] PTSR 985) and the Court of Appeal ([2019] PTSR 2272), and led Andrew Lane before the Supreme Court, instructed by Omur Izzet.