Equal Pay

The law and procedures in the employment tribunals on equal pay are complicated, however the principle behind them is simple – that men and women doing equal work should get equal pay for that work. This actually means that men and women doing the same work, or work to which an equal value has been attributed, are entitled to equal pay. So, for an individual to bring a claim he/she has to be able to draw on a comparator of the opposite sex doing either the same work, or work of an equivalent value.

The Equal Pay Act covers not only employees, but anyone retained personally to execute any work or labour”. Therefore this will cover consultants. There is also no initial qualifying period of employment to be served before rights under this legislation apply to an individual.

The legislation also covers virtually all contractual terms on pay and benefits. So the legislation will cover matters such as discretionary bonus payments. Each distinct part of the contract dealing with pay and benefits may be subject of comparison and analysis under this legislation. This enables equality to be maintained in all distinct elements of pay and benefits in kind.

As claims under the Equal Pay Act are notoriously complicated, and difficult to establish, the law allows individuals to submit a formal questionnaire to their employer before formally bringing their claim in the employment tribunal. The questionnaire enables the individual to obtain information from their employer, and access the information before deciding to pursue the claim or not. Replies given to the questionnaire are admissible in any later claim in the tribunal. Employers must treat these questionnaires seriously, as an evasive or equivocal answer in them, or failure to respond within the required period, will allow the employment tribunal to make an adverse inference against them.

Unlike claims of sex discrimination, the time limit for an individual to bring a claim in the employment tribunal under the Equal Pay Act is 6 months. (Most claims in the tribunals are subject to 3 months time limits).

It is clear from all these factors that Equal Pay claims can often be complicated; with the need to examine statistical and financial information, and to consider Job Evaluation Schemes. Once an individual has established that he/she and the opposite-sex comparator do like work, work rated as equivalent or of equal value, that individual will be entitled to the same pay (or benefits) unless the employer can establish that the difference is genuinely due to a “material factor” which is not the difference of gender or is itself discriminatory. Naturally the tribunals examine such alleged “material factor” defences very carefully. An employer will need to show that the factor is the genuine reason for the difference in pay, and is significant and relevant to the particular case being argued.

Some organisations have tried to argue that their pay-scales and pay differentials amount to a “material factor” defence, only to find that in analysis those scales are indirectly discriminatory. This deprives them of a lawful defence.

Equal pay claims are particularly complicated, so it is always important for both employers defending such claims, and individuals that believe they may have such a claim, to obtain detailed legal advice. (link individual advice contacts).