Banishment penalty waived initial bigotry (9)
I believe the answer is:
ostracism
'banishment' is the definition.
(I know that banishment can be written as ostracism)
'initial bigotry' is the wordplay.
'initial' becomes 'ost' (I am not sure about this - if you are sure you should give a lot more credence to this answer).
'bigotry' becomes 'racism' (I've seen this in another clue).
'ost'+'racism'='OSTRACISM'
'penalty waived' is the link.
I am not very happy about this link. Some or all of it may belong to another bit of the clue.
Can you help me to learn more?
(Other definitions for ostracism that I've seen before include "transferring to Coventry?" , "Rejection" , "being sent to Coventry" , "Exclusion from a group or society" , "Banishment" .)