c/o: First Minister and Minister for Business

Re: Business Concerns and Need for Clarity Following Supreme Court Ruling on the Equality Act

Dear First Minister,

We are writing as businesses and enterprise across Scotland to raise our concerns around recent developments following the ruling from the UK Supreme Court in For Women Scotland Ltd vs Scottish Ministers, and the subsequent interim update issued by the Equality and Human Rights Commission (EHRC) on April 25th. We write to express our growing concern over the operational and legal uncertainties created by the ruling.

This ruling, and the subsequent public and legal discourse, has introduced a significant degree of confusion about how equality law should be interpreted and applied in practice—particularly as it relates to the rights and protections of women and transgender people in the workplace and in service provision.

As employers and service providers, we have a legal and moral duty to treat all individuals with fairness, dignity and respect. However, without clear guidance, businesses are now exposed to increased legal risk, the potential for costly litigation, and the burden of having to independently interpret complex and evolving legal frameworks. Inconsistent application of the law across sectors could also create inequality in treatment and further exacerbate reputational risks.

At a time when inclusive employment practices are not only a moral imperative but also a driver of talent attraction, innovation, and productivity, a lack of clarity in this area risks undermining Scotland’s reputation as a progressive, inclusive place to live and work.

We are also concerned about the financial impact of prolonged legal ambiguity. Uncertainty creates instability. For many businesses—especially SMEs—this translates into additional costs around legal compliance, HR policy revisions, training, and reputational management, at a time when many are already managing post-pandemic recovery, inflationary pressures, and workforce challenges. Multinational firms operating in Scotland have also expressed concern about diverging equality standards and the impact this may have on investment confidence.

The impact on business of the ruling and the EHRC interim update has been notably absent from discussion so far, and our concerns have not yet been factored into the response. From our perspective, developments so far have certainly provided no clarity. Instead, they have raised many new questions around how our businesses will function.

Both the ruling and the EHRC update – which says for example that in workplaces trans women must not be permitted to use the women’s toilets and trans men should not be able to use the men’s toilets (and perhaps not be able to use the women’s toilets either) - have practical everyday consequences for us as business owners. They are a major departure from the settled understanding of how the law has been operating for decades, and will require a significant re-adjustment for us, especially in the way we are able to support staff, colleagues, partners and customers daily.

We need to understand clearly and in express terms: what is the law in this area; how will the law now operate in practice; what is expected of businesses, both as employers and those who offer services to the public; how we should re-adjust; and how this change will interact with other anti-discrimination legislation and the various duties incumbent on us as employers. We are concerned that the change now exposes us to more legal risk and reputational harm.

Businesses help to underpin the economy, especially in a time of uncertainty, but we do not operate in a vacuum. Whilst we appreciate government focus on and support for business and the economy, we see the value and necessity of ensuring that both are conducted in a way that complies with equality and human rights. We are concerned that a failure to do so threatens Scotland’s long history and international reputation as a country where business can thrive and one which is economically vibrant. Economies prosper where people are respected, are free to be who they truly are and can fully participate in working life.

We consider that the EHRC’s current interim update would be unworkable. It would have a significant impact, first and foremost on the trans community, but also on us as businesses and on our potential. We understand the value of having a diverse workforce where people feel included. Not only because it enables creativity, innovation and problem-solving but because it is the right thing to do. This includes how we confidently provide safe and inclusive spaces, and how we manage, resource and deliver our business. If businesses suffer in Scotland as a result, this will have a negative impact on our economy given the significant and vital contribution we make.

Our primary concerns, beyond our support for the trans community and everyone’s right to be safe and free from discrimination, are: