26 January 2015 Equal Pay new legislation and

26 January 2015 Equal Pay: new legislation and caselaw Amanda Jones

Today’s session Overview Determining the comparator Challenging JES Employer’s defence Equal Pay Audits Case law throughout

Barbara Castle – 9/2/1970 ‒ “There can be no doubt that this afternoon we are witnessing another historic advance in the struggle against discrimination in our society…” ‒ Speech on the Second Reading of the Equal Pay Act, House of Commons, 9 February 1970

Where are we now: The Statistics Global Gender Gap – UK drops from 18 th in 2013 to 26 th in 2014 Annual Survey of Hours and Earnings, November 2014 (mean figures used) Pay gap 11. 5% (Men FT vs. Women FT) Average weekly earnings £ 95. 60 less Gap varies across regions and sectors

Determining the Comparator ‒ North v Dumfries and Galloway Council 2013 ‒ Common terms and conditions = broadly similar ‒ “Real possibility” consideration not required ‒ Scope for comparison– Glasgow City Council v UNISON Claimants [2014] – ALEO employees can compare with direct Council employees

Challenging a Job Evaluation Scheme ‒ No defence if there are “reasonable grounds for suspecting” that the system was discriminatory or “otherwise unreliable” ‒ Burden is on the claimant (Hartley v Northumbria Healthcare NHS Foundation Trust ) ‒ Mc. Donald v Glasgow City Council EAT heard appeal in December 2014

JES: Pay Protection ‒ Perpetuating discrimination vs. cushioning the blow ‒ Express endorsement in 2010 Act of the legitimacy of pay protection ‒ Mc. Donald and ors v Glasgow City Council ET decision 2013

Pay Protection – legitimate aim ‒ Audit Commission v Haq (2013) ‒ Aim of projecting employees caught in a restructure was legitimate ‒ Objective was based on fairness and retention of valuable staff ‒ Do the statistics show a disparate impact? ‒ No need to identify a PCP

Employers defence since 2010 ‒ Material factor defence (“genuine” removed) ‒ Kenny and ors v Minister for Justice, Equality and Law Reform and ors 2013 ‒ Employer must objectively justify the difference in pay ‒ “Good industrial relations” cannot constitute the only basis of objective justification ‒ Ministry of Justice v O’Brien 2013

Caselaw since 2010 ‒ Calmac Ferries v Wallace (2013) -First EAT decision concerning 2010 Act ‒ Yates v Collins and Hobson plc. 2013 ET Cautions against stereotyping ‒ Bradley v Royal Holloway and Bedford New College 2013

Private Sector – in the news “That's Asda price: Firm in equal pay row as more than 1, 000 staff threaten legal action”

Equal Pay Audits (EPA) ‒ From 1 October 2014 ‒ Background: Modern Workplaces Consultation ‒ “Think, Act, Report” failed to make significant progress ‒ Not a requirement to publish gender related pay information

EPA: Name and Shame ‒ Unsuccessful employers (at ET) will be ordered to carry out and publish an EPA ‒ In an equal pay or sex discrimination claim ‒ What will be required from an audit (ET has wide discretion): – Relevant gender pay info including overtime and bonus; Gender related pay differences and reasons why; plans to address issues identified

EPA: Exceptions ‒ ‒ New businesses (<12 months) <10 employees Audit within last three years If Tribunal can find what remedial action is required without an EPA ‒ No suggestion of any other breaches ‒ Disadvantages outweigh benefits

EPA: Time and Penalties ‒ Employers will have at least 3 months from the date of the order ‒ Expected to allow up to one year for large companies with complex pay structures ‒ Failure to comply >£ 5000 fine payable to So. S ‒ Ne deadline then given, further >£ 5000 fine if continues to fail to comply ‒ No limit on number of penalties

EPA: Impact and Risks ‒ Low risk? ‒ Reducing number of ET claims ‒ Few equal pay claims lead to determination by the ET ‒ Consider a voluntary audit? ‒ Public sector should be carrying out audits as part of PSED

Contact Amanda Jones Partner 0330 222 1810 amanda. jones@mms. co. uk