Fear and loathing at equality central

It was not supposed to work like this. The Government's equality watchdog – which is charged with rooting out discrimination on the grounds of sex, race, religion, sexuality, age or disability – was yesterday in the dock charged with discrimination by a member of its own staff. It only adds to the mound of political embarrassment being heaped upon the chairman of the Equality and Human Rights Commission, Trevor Phillips, whose days in the job look increasingly limited.

The woman before an employment tribunal yesterday was Brid Johal, from Tipperary. (These things are important when it comes to equality). She was an aide to the aide of Mr Phillips. Even aides have aides in the wonderful world of quangos, until David Cameron gets his way at any rate. While she was on maternity leave the person who was covering for her – whom we might, unkindly perhaps, describe as the aide of the aide of the aide – was promoted over Ms Johal's head. It happened just as a commission bigwig was holding forth publicly about how unfortunate it was that women get penalised if they take a year off. Ms Johal told the tribunal that she had not been informed that there was a vacancy available despite her bosses' promises that she would be "kept in the loop" while she was away.

There is now muttering inside the EHRC about how it has not, after all, consigned to history a world in which some people are more equal than others. "There is something oddly old-fashioned going on in terms of plum jobs at the higher level," one insider said recently.

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Some are beginning to think that the man at the top, Trevor Phillips, may have feet of clay. Indeed some are murmuring that the clay goes up to knee-level and beyond. The commission has been hit in recent months by a succession of internal disputes and allegations of financial irregularities. There is talk now that the former television executive, who wanted a second term in the job, will be forced to step down when his contract ends in the autumn.

It was never meant to be like this. When Phillips was appointed as head of the Commission for Racial Equality (EHRC's predecessor) in 2003 he was acclaimed as high-profile, well connected and, most importantly, willing to take positions contrary to those normally adopted by race campaigners. He was also able to engage with the arguments of the old-style left as well as those of the right.

But his tenure has not been smooth. Ever since the EHRC was formed he has been in the firing line, not just for his ideology but for his management of the organisation as well.

In the next few weeks the National Audit Office is expected to deliver a hard-hitting verdict on the commission's finances, and may even qualify its accounts. Its concerns are said to centre on staff who were given generous redundancy payments when the CRE was wound up, then re-hired by the EHRC. Mr Phillips may soon face questions in Parliament.

More personally embarrassing for Mr Phillips is the rumbling row over his private business activities. Last year he was forced to quit as director of the Equate Organisation, a management company that he founded – and in which he owns a 70 per cent stake – when it was disclosed that it gave advice to Channel 4 following the Jade Goody race row in the 2007 series of Celebrity Big Brother. He was accused of a conflict of interest between his business and his public-sector role. It was also revealed that his contract with the commission – where he is paid £110,000 for a three-and-a-half day week – allowed him to use the commission's offices for a number of exclusively private business activities. "Mr Phillips should decide whether he wishes to be a management consultant or whether he wants to chair the Equality and Human Rights Commission," the equal opportunities lobbyist Michael Rubenstein wrote at the time.

The row continues because the Equate website continues to display a picture of Mr Phillips with the accolade: "Trevor is one of the leading experts on migration in Europe. He has, for over two decades, been advising private companies particularly in the media and finance sectors on their response to social change; and remains one of the most widely listened-to advisers to government and public bodies in Europe. He is the chair of the UK's Equality and Human Rights Commission." This is despite requests from the commission's legal director that it should be removed.

Then there is the internal turmoil: 34 permanent members of staff have resigned during the past year. Some, including the organsiation's chief executive, Nicola Brewer, have gone on to appreciably better jobs. But in April three board members resigned after a public assertion by Mr Phillips that the police were no longer institutionally racist. Mr Phillips argued that the police had "shown a much better understanding of how to deliver a public service that doesn't discriminate just because of the colour of your skin" since the botched investigation into the murder of Stephen Lawrence. But this did not go down well with the old guard.

They had already been incensed by his U-turn on multiculturalism – the notion that a diverse society should celebrate the different cultures of its ethnic groups. Multiculturalism, Phillips argued, might actually be counter-productive. Rather than creating a diverse society, he said, it could open social divisions and cause Britain to "sleepwalk towards segregation". The veterans of the race industry were dismayed.

But Phillips was not alone. After 9/11 the Government had became determined to find sets of values and touchstones that could promote a more integrationist view of the politics of race. Tony Blair, with whom Mr Phillips had become friendly via Peter Mandelson – who was best man at Mr Phillips's wedding – began to try to co-opt Muslims into "community cohesion". Gordon Brown became obsessed with Britishness.

To his critics Mr Phillips was doing New Labour's bidding. To his friends he was forming the debate. However, many in the ethnic minority communities were alarmed, arguing that it was his job to defend minorities, not give succour to attacks on them.

Eventually Trevor Phillips went too far for his some of his more ardent supporters. His remarks last year that if Barack Obama became President it might "postpone the arrival of a post-racial America" caused consternation in the higher echelons of the Government. And his claim that it would be impossible for a black candidate to rise to the top in UK politics because of institutional racism in the Labour Party was deemed to be ill-considered, taking no account of the fact that non-whites constitute a third of the US population but less than 10 per cent here.

There is now talk that his time at the commission may be nearly up. Some are suggesting deal may be done to allow him to save face, by which he will be offered another three years – on the understanding that he will turn it down. He might be offered a job as head of another quango, the British Council, which has a vacancy at the top following the departure of Neil Kinnock who had to quit when his wife, Glenys, was made a minister. It would mean a significant drop in salary for Mr Phillips. But promoting Britishness around the world may prove easier than trying to define it in this country.