Employers have been warned to review their equal opportunities policies after a gay man who was called a ‘wee poof’ by his boss was awarded a record pay-out of nearly £120,000.

Law firm DWF says the case shows that firms who breach the rules could face potentially crippling penalties, since there is no upper limit on the amount of compensation in discrimination cases.

The award of £118,309 is believed to be the highest since the law prohibiting discrimination on grounds of sexual orientation came into force on 1 December 2003. A Glasgow employment tribunal decided that Jonah Ditton suffered ‘humiliating and degrading abuse’ at the hands of his employer, CP Publishing, of Glasgow.

The tribunal heard that Mr Ditton, a sales executive, was sacked after just eight days for being ‘psychologically imbalanced’. He had expected to earn over £80,000 a year but instead had become severely depressed, had turned to alcohol and was now on benefits.

Ansar Ali, employment lawyer with DWF, says the rules cover any situation where an employee suffers discrimination on grounds of sexual orientation. They allow for a separate complaint of harassment where the worker’s treatment violates his or her dignity or creates an intimidating, humiliating or offensive environment.

He says: “Employees should be aware that discrimination on grounds of sexual orientation can apply to all workers, even those who suffer bias because they are heterosexual or because they are wrongly perceived to be gay. They also apply to those who suffer discrimination because they are associated with someone of a particular sexual orientation.

“In discrimination cases there is no upper limit on the amount of compensation. The pay-out can cover both loss of earnings and injury to feelings and in serious cases, a tribunal can also award aggravated damages. Therefore infringement can prove very costly indeed.

“However there are ways in which employers can protect themselves. They should ensure all staff, particularly managers or supervisors, are aware of the rules and that there are policies in place covering equal opportunities, bullying and harassment.

“Provide equal opportunities training for all employees and act promptly on any complaints. It is also a good idea to review policies and procedures regularly to ensure that they do not unwittingly discriminate against employees.”