The Equality Bill: part two
In the second in a series of articles on the Equality Bill, we look at the changes that the Bill makes in relation to sex discrimination in the workplace and equal pay.
On this
page:
Overview
Direct
discrimination
Gender reassignment
Occupational
requirements
The armed forces
Equal pay
Material factor
defence
Direct pay discrimination
- hypothetical comparators
Discussions
with colleagues
Gender pay gap
information
Overview
The Equality Bill does not propose any fundamental changes to the scope or meaning of sex discrimination and equal pay. This article highlights only those areas where it could be argued that some change is introduced, even where this is unintentional.
In introducing the Bill, the Government has placed considerable emphasis on the increased scope for positive action, with particular reference to enabling employers to decide to recruit more women to senior positions. These measures are set out in clauses 152 and 153 of the Bill and apply to all the "protected characteristics" (see The Equality Bill: part one), not just sex. We will deal with these provisions in detail in a future article.
Direct discrimination
In line with the other protected characteristics, in relation to sex, clause 13 on direct discrimination covers discrimination by association, as well as discrimination because of the claimant's gender. Thus, if an employer treated an individual less favourably because of the gender of someone associated with him or her, this would be unlawful. In practical terms, it may be difficult to envisage such a scenario, and the lack of protection from discrimination by association in the Sex Discrimination Act 1975 does not seem to have caused many practical difficulties.
An employee who was discriminated against because of his or her partner's transgender status would also be protected under clause 13.
Discrimination by association does not apply in relation to marriage and civil partnership. Clause 13(4) provides that, where the protected characteristic is marriage and civil partnership, direct discrimination in the workplace is unlawful only if the treatment complained of is because the claimant is married or a civil partner. Not only does this exclude discrimination by association, but it also preserves the current position under the Sex Discrimination Act 1975 that it is not unlawful to discriminate against someone on the grounds that he or she is single.
In provisions that mirror those in the Sex Discrimination Act 1975, clause 17 includes, within the concept of discrimination because of the protected characteristic of pregnancy and maternity, discrimination because of either an individual's pregnancy or an illness suffered by her as a result of the pregnancy. This applies only during the "protected period", which begins with the start of the pregnancy and finishes at the end of the additional maternity leave period or the employee's return to work (if earlier) (clause 17(6)). Clause 17 also covers discrimination because a woman is on compulsory maternity leave (the initial two-week period after the birth), or has exercised, or sought to exercise, her right to take ordinary or additional maternity leave.
Clause 17 does not, however, replace clause 13 (direct discrimination) in relation to the protected characteristic of pregnancy and maternity and workplace discrimination. Rather, it provides a free-standing form of discrimination specifically related to the pregnancy of the claimant and taking place within the protected period, for which there is no need to show any comparison (clause 22). Discrimination that does not fall within clause 17 may still amount to direct discrimination because of the protected characteristic of pregnancy or maternity within clause 13, provided that the claimant can show that an appropriate comparator would have been treated more favourably.
Were, for example, a man to be dismissed because his employer discovered that his partner was pregnant, there seems to be no reason why that could not amount to direct discrimination because of the protected characteristic of pregnancy or maternity. Such a possibility is not covered by the Sex Discrimination Act 1975.
Gender reassignment
Some significant changes are made to the law governing discrimination based on the protected characteristic of gender reassignment. Under clause 7, a person has the protected characteristic of gender reassignment if he or she is "undergoing or has undergone a process (or part of a process) for the purpose of reassigning the person's sex by changing physiological or other attributes of sex".
There is an important difference between this definition and that found in the Sex Discrimination Act 1975. Under the Act, the process of gender reassignment must take place under medical supervision. This requirement has been dropped from clause 7. As a result, someone who takes the decision to present in a different gender from that of his or her birth will potentially be protected, even where no formal medical procedures are followed.
However, it does seem that the process of reassigning a person's sex must have a degree of permanence to it, and that the person must undertake a deliberate decision to make the transition. Someone who chooses to cross-dress from time to time will not be covered. In addition, it is unlikely that someone who is discriminated against because of an androgynous appearance, or because his or her appearance or behaviour does not conform to what is regarded as normal for someone of his or her gender, will be covered.
However, it is possible that less favourable treatment of such individuals would be because of the protected characteristic of sex, although this is an issue that would need to be argued out in the courts.
Another possibility arises from the fact that, as clause 13 talks of direct discrimination "because of a protected characteristic", this can be wide enough to cover discrimination based on the perception of the discriminator. If an employer perceived an individual to be someone who was undergoing gender reassignment, discrimination based on this could be unlawful, even if the individual had not actually undertaken such a process.
The key change regarding gender reassignment is that it is brought within the scope of indirect discrimination (clause 18). A provision, criterion or practice that disadvantages those who have the protected characteristic of gender reassignment will therefore be unlawful, unless the employer can show that it is a proportionate means of achieving a legitimate aim. Potential situations may include the way in which employee data about transgender people is stored or disclosed to others. If such information referred to someone by reference to his or her birth, rather than acquired, gender, this might result in a particular disadvantage, which the employer would have to justify.
Occupational requirements
The Sex Discrimination Act 1975 differs from the other current discrimination legislation in that, rather than allowing an exception where being a particular gender is a genuine occupational requirement, it sets out specific circumstances when being a particular gender can be regarded as a genuine occupational qualification for a job. These include: where there is a need to preserve decency or privacy; in dramatic performances or other entertainment, for reasons of authenticity; and where the holder of the job provides individuals with personal services promoting their welfare or education, or similar personal services, and those services can most effectively be provided by a person of a specific sex.
The Bill brings sex discrimination into line with the other grounds of discrimination by replacing this detailed list of exceptions with a general exception.
Paragraph 1 of sch.9 provides that discrimination (other than in relation to the terms of employment or in subjecting someone to "any other detriment") by which the employer requires the claimant to have a "particular protected characteristic" is permitted if the employer can show that, having regard to the nature or context of the work:
- it is an occupational requirement;
- the application of the requirement is a proportionate means of achieving a legitimate aim; and
- the person to whom the requirement is applied does not meet it.
This formula is not identical to that currently used in the other discrimination strands. The concept of the requirement being "genuine" has been dropped, presumably because the word adds nothing to the meaning. Neither is it necessary for the requirement to be "determining". Instead, the employer must show that there is a legitimate aim behind the decision to apply the requirement, and that it is a proportionate means of achieving this aim.
Because the exception refers to a requirement to have a particular protected characteristic, it would seem that an employer cannot seek to argue that it is an occupational requirement not to be pregnant (as it might wish to do if a key aspect of the job required an individual to be at work during what would otherwise be maternity leave). A non-pregnant person cannot be said to meet a requirement "to have a protected characteristic": it is the fact that he or she does not have such a characteristic that the employer would be seeking to rely on, and that is not covered by the exception.
In relation to the protected characteristics of gender reassignment and marital status, para.3 of sch.9 states that an occupational requirement applies to a requirement "not to be married or a civil partner" or "not to be a transsexual person".
An important change in relation to gender reassignment is the dropping of the genuine occupational qualification provisions in s.7B of the Sex Discrimination Act 1975 relating to transgender persons who have not yet acquired a gender recognition certificate. These include where the job holder may be required to perform "intimate physical searches". Under the Bill, employers seeking to rely on such issues will have to meet the general occupational requirement definition set out above.
In practice, there has been little litigation on the application of genuine occupational qualifications in relation to sex discrimination. Whether or not the new wording substantially alters the scope of the defence may not therefore be something that finds its way before the courts in the near future.
The armed forces
Under s.85(4) of the Sex Discrimination Act 1975, there is a general exception for any act done "for the purpose of ensuring the combat effectiveness of the armed forces". In Sirdar v The Army Board [2000] IRLR 47 ECJ, the European Court of Justice (ECJ) ruled that, for such discrimination to come within the Equal Treatment Directive (76/207/EEC), the discrimination must be a proportionate means of achieving the aim of maintaining combat effectiveness. The Bill explicitly recognises this principle, and expresses the issue in more limited terms than the Act.
Paragraph 4 of sch.9 provides that sex discrimination in relation to recruitment; promotion, transfer and training; and the provision of benefits facilities and services is not discrimination if it can be shown that the discrimination is a proportionate means of ensuring the combat effectiveness of the armed forces.
The role of women in the armed services is being reviewed. No doubt the changes to this provision will feed into the debate.
Equal pay
Given the emphasis that the Government has placed on addressing the relative pay of men and women, it is perhaps surprising that the Bill is at its least radical in dealing with the subject of equal pay. Apart from some new provisions aimed at improving transparency - discussed below - the main substance of the Equal Pay Act 1970 is replicated in clauses 59 to 71, albeit drafted in clearer terms and brought together with the relevant provisions of the Pensions Act 1995. Although no fundamental amendments are made to the equal pay regime, there are some changes that may prove significant.
Material factor defence
Clause 64 deals with what has hitherto been known as the "genuine material factor" defence. The word "genuine" has been dropped from the Bill as not adding anything to the requirement to show that the difference in pay is because of a material factor that is not the difference in sex.
Clause 64 also seeks to recognise case law developments in relation to equal pay by specifically providing that the material factor must not result in indirect discrimination. This is defined in clause 64(2) as occurring where "A shows that, as a result of the factor, A and persons of the same sex doing work equal to A's are put at a particular disadvantage when compared with persons of the opposite sex doing equal work to A's". Where this is demonstrated, the employer must show that relying on the factor is a proportionate means of achieving a legitimate aim.
It is tempting to parse this definition and compare it with the various approaches to indirect discrimination in the context of equal pay taken by the ECJ over the years. However, it is necessary to bear in mind that equal pay is ultimately governed by art.141 of the Treaty establishing the European Union. If the Bill falls short of the requirements of art.141, claimants can rely directly on the Treaty provision. Minor differences between the Bill and ECJ case law are not therefore a major cause for concern: the courts will simply overlook any ways in which the Bill fails to reflect art.141.
Clause 64(3) provides that, for the purposes of establishing a material factor defence, the "long-term objective of reducing inequality between men's and women's terms of work is always to be regarded as a legitimate aim". This seems to be a nod in the direction of several recent equal pay cases that have focused on the transition to new pay systems in the public sector. The explanatory notes give the example of an employer providing a limited period of pay protection for higher-paid employees who lose out when a new pay system is introduced.
This provision is unlikely to have much practical effect. The issue is not whether or not the aim of reducing pay inequality is a legitimate one, but rather whether or not the particular way in which this is done amounts to a proportionate means of achieving that aim. This is what the recent cases have been concerned with, and the Bill provides no assistance in answering this question. Indeed it cannot, as the point is ultimately whether or not there is compliance with art.141.
Direct pay discrimination - hypothetical comparators
A new provision in relation to equal pay allows a claimant to bring a sex discrimination claim where the lack of a comparator would prevent an equal pay claim from succeeding. Clause 66 provides that in such cases the claimant can rely on clause 13 to establish direct discrimination. Essentially this allows an equal pay claimant to rely on a hypothetical comparator. For example, if an employer employs only female cleaners, but it can be shown that, if a male cleaner were employed, he would be paid more than the current employees, they would be able to bring a direct sex discrimination claim. Under the current law, such a claim would have to be brought under the Equal Pay Act 1970, and would be defeated by the lack of an actual comparator.
Discussions with colleagues
In promoting the Bill, the Government has placed considerable emphasis on banning so-called "gagging clauses" placed in contracts of employment to prevent employees from discussing their pay with colleagues. The argument is that this provision, found in clause 72, will increase transparency in pay systems, which will be helpful in achieving equal pay.
Secrecy clauses relating to pay are not banned altogether. Rather, clause 72 provides that, where a person is prohibited by the employer from being involved in discussions with colleagues about the terms of his or her work, this is unenforceable insofar as that person is involved in a "relevant pay discussion". Being involved in a relevant pay discussion is also a protected act for the purposes of the provisions relating to victimisation. The result is that any less favourable treatment of someone on the grounds that he or she has participated in such a discussion could lead to a victimisation claim.
A relevant pay discussion is a discussion with a colleague that is about pay and that relates to any possible link between pay and having or not having a particular protected characteristic (clause 72(2)). There is no blanket right for employees to discuss their pay with colleagues. A discussion is protected only if the discussion is specifically about whether or not the pay is discriminatory.
For example, if one employee said to a colleague "I'm worried that our employer is not paying men and women equally for work of equal value. How much do you earn?", this would be a relevant pay discussion. However, it is unlikely that the question would be put this way. The explanatory notes give as an example a woman who asks a man what he is paid because she thinks that she is underpaid compared to him. However, if the woman asking the question does not explain that her concern relates to discrimination, how is the man to know whether the discussion is a "relevant pay discussion" or not? It is not clear if the unexpressed intention of the person initiating the conversation is enough to bring the discussion within the provision. This is perhaps an issue that can be revisited as the Bill makes progress.
Gender pay gap information
Another much publicised aspect of the Bill is the requirement on employers with 250 or more employees to publish information on the pay of employees showing whether or not there is a difference in the pay of men and women. However, clause 73 merely creates a regulation-making power, allowing for such a requirement to be introduced. The Government has said that it intends to consider acting on this power in 2013. There will be a consultation on the sort of metrics that an employer could be required to publish.
This therefore remains a political rather than a legal issue, and no fresh obligations in this area are placed on employers by the Bill itself.
