THE GOVERNMENT"S recent announcement that it will conduct a "root and branch" review of the causes of persistent discrimination in British society looks likely to transform the legal landscape.

Compensation in discrimination cases is potentially unlimited and the average award is on the up (the highest-ever being £814,000), so discrimination law is something that employers cannot afford to ignore.

The Court of Appeal has made a groundbreaking decision that once an employee has proven a version of events which could be discriminatory, it is then up to the employer to prove that their actions were not.

The court heard three cases together:

Igen Ltd v Wong involved a complaint by an employee that her appraisal had been tainted by race discrimination.

Emokpae v Chamberlin Solicitors was centred on a single racist remark and Brunel University v Webster concerned the dismissal of a female employee after office rumours of an affair with a male manager.

The court decided that if the employer could not show that there was no discrimination involved in the alleged acts of discrimination the tribunal must uphold the employee"s complaint of discrimination.

The practical effect of this decision on employers is that they are likely to lose the case unless they can provide a detailed paper trail evidencing the non-discriminatory reason for the treatment about which the employee is complaining.

In the absence of such evidence the court will infer that the real reason for the employer"s treatment of the employee was discriminatory.

The decision will have an impact on any claim alleging discrimination on a protected ground (including disability), and it is hoped the decision will reinforce previous changes introduced by the government and help stamp out discrimination in the workplace.

It will certainly lead to more out-of-court settlements because unless employers have created and maintained a comprehensive paper trail they will be heading for certain defeat. Employers must ensure that they recognise when their acts are potentially discriminatory.

For example, a failure to amend their grievance procedure to allow a depressed (and thus potentially disabled) employee to participate fully in the procedure may give rise to allegations of disability discrimination.

Pressurising a female employee to exceed her sales target before starting maternity leave or requiring her to use the toilets to express breast milk will leave an employer open to allegations of sex discrimination.

And failing to provide an interpreter when disciplining an employee whose understanding of English is limited may lead to allegations of race discrimination.

The message is clear: the courts are taking a hard line on discrimination.

With the number of employees pursuing discrimination cases on the rise, and recent changes to outlaw discrimination on new grounds, employers must make sure that they are aware of their legal responsibilities.

If and when an employee does allege discrimination a good employer must know how to handle the complaint.