Equal value update

Equal pay for work of equal value

The equal pay for work of equal value law came into operation in 1984. It provides a presumptive right to equal pay "where a woman [or man] is employed on work which … is, in terms of the demands made on her [or him] (for instance, under such headings as effort, skill and decision), of equal value to that of a man in the same employment" (s.1(2)(c) of the Equal Pay Act as amended). Claims can be made across bargaining units, grading, or job evaluation schemes. The law enables comparisons to be made between totally different jobs. For instance, a clerical worker may claim that she is employed on work of equal value with a male production worker, and vice versa; a female speech therapist with a male psychologist; a female school canteen assistant with male ground staff, etc.

By the end of 1995, there had been about 8,500 equal value applications in the UK, involving around 640 employers. Approximately a third of the claims were from British Coal employees or employees in the health service. In Britain, just over half of the equal pay claims during this 11-year period were categorised as equal value applications.

Unfortunately, equal value application statistics for 1996 onwards are not available, because the agencies responsible for collating the statistics, ACAS in Britain and LRA in Northern Ireland, no longer differentiate between the different equal pay claims. Difficulty in distinguishing between equal value claims and equal pay claims based on other grounds, is cited as the main reason. Equal pay claims in Britain last year, numbered 3,447, including equal pay for work of equal value, compared with 2,886 applications in 1997.

The equal value procedure generally involves three main stages:

Referrals

During 1997 and 1998, 18 cases, involving over 40 applicants, were referred to independent experts by UK employment tribunals, nine in each year. This is approximately double the number of cases in which the tribunal opted to use its new powers to determine the equal value issue itself, see below. The jobs the independent experts were asked to compare included:

We list all the cases which have been referred to an independent expert in 1997 and 1998 on pp.28-29, along with details of the progress of those cases which were with an independent expert at the time of our last update.

By the end of 1998, UK tribunals had referred a total of 195 cases, involving around 1,870 applicants, to independent experts since the equal value law came into operation. By the summer of 1999, the majority (65%) of these cases had been settled or withdrawn without the need for a determination by an employment tribunal. In just over a quarter of the settlements or withdrawals, the independent expert's report was not completed. Thirteen cases are still ongoing. The remainder have been determined by a tribunal, with around three out of five tribunal decisions in favour of the applicant.

Delay

Since our last update, employment tribunals have ruled on the equal pay issue, following an independent expert's report in five cases. The time taken from the tribunal's decision to refer the case to decision on equal pay in these cases averaged just over 19 months, and ranged from 11 months to 28 months.

Employment tribunals have now ruled on equal pay following the decision to refer the case to an independent expert in 44 cases since the equal value law came into operation. The average time taken between the tribunal's decision to refer the case and its eventual ruling on equal value has changed little since our last update. On average, each case has taken just under 20 months to complete, ranging from five months to 49 months. However, there has been some movement on the median length of time. Since our last update, the median has fallen by one month from 18 months to 17 months. Exactly half of the cases have taken over 18 months to complete while over a quarter have taken more than two years (see table).

However, as we have noted in the past, focusing on delays at this stage in the procedure fails to give the whole picture. For example, no account is taken of cases still in the procedural pipeline, some of which have gone well beyond 20 months. Indeed, although the equal value issue in the speech therapist test cases has been determined, compensation has still to be decided in the vast majority of the successful speech therapist cases (see box, p.20 for more on the speech therapists). However, even this long-running saga is likely to be overtaken by the claims against British Coal.

In the British Coal cases, as in those of the speech therapists, the problems of delay have been compounded by the vast number of applicants and comparators, the high financial stakes and the lengthy appeals over preliminary issues. The case involves approximately 1,280 women employed as canteen workers or cleaners who are comparing their work with that of 150 comparators employed as surface mineworkers or as clerical workers. Claims were submitted between December 1985 and April 1988. At the end of 1990, a tribunal determined two preliminary issues, ostensibly paving the way for independent expert assessment: first, that the applicants were employed in the same employment as their comparators and, secondly, that separate wage structures did not justify the wage disparities. There then began a lengthy appeal process, culminating in the House of Lords upholding the tribunal's decision in May 1996. A number of lead cases were finally referred to an independent expert at the end of 1997.

The delays in the British Coal cases have prompted the EAT to express strong criticism of the equal value procedure. The EAT's industrial members characterised the procedure as "fouling the proper administration of the law within this sphere". They pointed out that the procedure both "allows tactical manoeuvring by an employer" and allows applicants, supported by trade unions, to adopt an "oppressive tactic" of naming numerous comparators. The then president of the EAT, Mr Justice Wood, endorsed these criticisms, adding that the "present unsatisfactory situation must be recognised, needs to be discussed publicly, and merits the most urgent consideration." The whole system, he said, "requires a prompt and thorough review". That was back in 1993.

Reform

Since then there have been some changes to the procedure aimed at reducing delay. In 1996, for example, employment tribunals were given the discretion to determine the question of equal value, instead of referring it to an independent expert. Few cases have taken this route, but where they have, the length of time taken to determine the equal value issue has been significantly reduced as a result of omitting the independent expert stage (see below). But the other reasons for delay have yet to be tackled and we still await the "thorough review" called for by the EAT president.

The EOC is in no doubt that more needs to be done. "Long, expensive cases," it says, "cost the public money and hurt an individual's chances of getting proper access to justice." Last year it submitted a number of proposals to the Government "to help make justice speedy and straightforward". Among other things, it recommended that:

In addition it urged the Government to adopt the proposals on tribunal procedures and independent experts suggested by the tribunal in one of the speech therapist cases, Lawson v South Tees District Health Authority. These proposals included a preliminary hearing for equal value cases and the requirement for an independent expert to draw up a job description for both the applicant's and comparator's jobs following a preliminary hearing (see box). The reason for the latter proposal was partly prompted by the difficulties the independent experts had faced in the speech therapist cases when trying to assess jobs almost 10 years after the proceedings had commenced.

Last July, the Government responded to the EOC's demands. Whilst it did "not consider the time is right for major changes in the law", the Government said that it recognised "that there are some technical changes to the legislation that would assist people" in equal value cases. Speaking at the TUC general congress in September, Minister for Women, Baroness Jay, said that the Government wanted to "alter the system to so that cases are easier to assess". This, she said, will "speed up the system". Any changes will follow consultation and will be made "when parliamentary time becomes available", she added.

Code of Practice

Ahead of any legislative changes, Baroness Jay pledged that the Government would "work more energetically with the EOC and with private and public sector employers" as well as trade unions, to make sure that the Commission's 1997 Code of Practice on pay, which has had little noticeable impact so far, is more "vigorously implemented". How it is going to do this was not clear at the time of going to press. But what is clear that the "business case" will have a role to play: "This Code," said Jay, "needs to be given a new life and a new profile so that employers recognise that there is a business case for equal pay which falls in with their concerns about competitiveness and productivity."

The EOC's Valuing Women campaign, which was launched at the time of going to press, aims to do just that (see p.2).

A similar Code, issued by the EOCNI, came into effect in May 1999. Like the British Code, it is admissible in evidence in any equal pay proceedings taken before an industrial tribunal and recommends pay system reviews as the most appropriate method of ensuring that a pay system delivers equal pay, free from sex bias. The Code, which locates the advice in the Northern Ireland context, proposes that employers should carry out an eight-stage review (this is the same as the British Code apart from the switching of stage four and stage five). See box.

Settlements

There have been a number of major settlements since our last update. The largest involve local government - the biggest single employer of women in the UK - where, as we have seen from past updates, unions are using the equal pay law as a catalyst for negotiated settlements.

On the basis of the settlements that we are aware of, just under 1,000 women shared a total of £3.4 million.

The largest settlement involved Bedfordshire County Council, where nearly 400 school dinner staff, mainly female part-time workers, agreed to end their equal value and sex discrimination claims for a total of £1.5 million after taking the authority to an employment tribunal. The comparisons included: kitchen manager with transport officer; cashiers and cleaners with male domestics; and cooks with care assistants. Most of the women, who were backed by the GMB and Unison trade unions, received between £2,000 and £4,000 each.

Other settlements include:

Equal value law

We now turn our main focus to the legal issues which have been raised in cases at employment tribunal and appeal level since our last update. All statutory references are to the Equal Pay Act as amended (EqPA) unless otherwise stated.

Comparator

There are two cases decided since our last update that are worthy of note under this section. Both arise out of long-running equal pay battles: the North Yorkshire County Council dinner ladies and the speech therapists.

Separate employers

Section 1(6) of the Equal Pay Act limits the potential comparator for an equal pay claim to employees in the same establishment as the complainant, or in an establishment of an associated employer provided common terms and conditions are observed. Article 119 of the EC Treaty, however, contains no express limitation on the scope of an equal pay comparison. Nor does Equal Pay Directive 75/117. The issue in Lawrence and others v Regent Office Care (EOR 84) was whether EU law can be relied upon to allow a comparison between employees of two separate employers: a county council and a private contractor supplying services to the council.

The applicant women were originally employed by North Yorkshire County Council (NYCC) as school catering assistants. In Ratcliffe v North Yorkshire CC (EOR 63), the House of Lords upheld an equal value test case brought by NYCC catering assistants comparing their work with other local government employees. During the course of that litigation the catering work was then contracted-out to private employers. All the applicants were asked to work on different (and, in their view, less favourable) terms than they enjoyed with NYCC. They brought an equal pay claim, seeking to rely on Article 119 of the EC Treaty to compare themselves with current employees of NYCC whose work was rated as of equal value to their own. In effect, unless they could compare themselves with those employees who are currently employees of NYCC whose work was rated as of equal value to their own, they would be deprived of the fruits of their success in the earlier litigation. Nonetheless, their complaint was rejected by an employment tribunal and the EAT dismissed their appeal.

In the EAT's view, in order to bring an equal pay claim, the applicant and comparator must be in a loose and non-technical sense in the same establishment or service, even though it is not necessary for the same entity to be employer of both applicant and comparator, or for the employers to be associated. However, there was nothing in this case which would distinguish it from any other where an applicant claimed equal pay with a comparator employed by another company, not necessarily even engaged in the same industry, said the EAT.

We have expressed surprise at this appraisal elsewhere, given the history of the claim, (EOR 84). The basis of the Ratcliffe case was that the in-house direct service organisation (DSO) lost the contracts in some areas for providing school meals to commercial catering groups, thus prompting the DSO to dismiss the dinner ladies and re-employ them on lower hourly rates. The women then established that they were employed on work rated as equivalent, under the local government job evaluation scheme, to posts such as road sweeper and refuse collectors. Thus the DSO had to observe the principle of equal pay in deciding whether to bid to continue the work. If they were able to pay the women a lower rate because they had no equal pay obligations to the women, that placed the DSO at a competitive disadvantage. The applicants here were, in effect, seeking to maintain their equality clause, something which distinguishes their case from the vast majority of hypothetical cross-company comparisons. The EAT also took no account of the fact that provision of school meals is part of the education "service", or of a "service" ancillary to education, activities still carried out by the county council.

Changing the comparator

Once an applicant has named a comparator in her originating application is it possible to subsequently rely on a different comparator of a different sex? This was the issue facing the employment tribunal in the joined speech therapist cases of Corcoran v Croydon Health Authority and Secretary of State for Health and Ross v Kingston & Esher Health Authority and Secretary of State for Health (15 January 1999; case nos. 18133/87 and 18232/87).

Mrs Corcoran's and Ms Ross's cases were two of the 1,500 or so speech therapist cases which were held in abeyance pending the outcome of the agreed test cases. Originally the two applicants claimed equal pay with a district dental officer and a principal biochemist. At the time they submitted their claims, their union, MSF, was advising all members of the speech therapy profession to submit claims to the employment tribunals in order to protect their position pending the resolution of preliminary issues raised in the test case litigation. Because of the number of applications, the union could not provide legal advice and guidance to individual applicants, but in any event, until the preliminary issues were determined, such legal advice might well have been premature. As a result, Mrs Corcoran and Ms Ross chose their own comparators when they presented their originating applications. The comparators in the lead cases were either clinical psychologists or pharmacists, as they were in most of the other cases. Mrs Corcoran and Ms Ross sought to amend their applications in 1998, some 11 years after they had made their originating applications, following attempts to settle all the cases in the light of the developments in the test case litigation. Mrs Corcoran wished to compare herself with a district pharmacist and Ms Ross with a district psychologist.

The tribunal allowed the amendments. In doing so, it noted that "everyone had been on a learning curve with this series of cases". It found that the purpose of identifying the lead cases was to assist the parties "in resolving through agreement the many other outstanding cases pending". The tribunal was satisfied "that when identifying the lead cases, both parties did so on the basis of a typical cross-section of the speech therapy profession and that it was intended that the principles gleaned from the decisions in the lead cases should be applied to all the cases". It took the view that the respondents "would not be prejudiced by an amendment at this late stage, because it had no evidence of any action on the part of the respondents before it that they had actually begun to collect evidence from the original comparators. In addition, the comparators are not parties to the action." On the other hand, both applicants "would be adversely affected by further delay and separate proceedings."

No reasonable grounds

Prior to 1996, an employment tribunal was obliged to refer an equal value claim to an independent expert unless there were no reasonable grounds for determining that the work was of equal value, ie the case was "hopeless". Following its finding that the case was hopeless, it was the duty of the tribunal then to go on and to dismiss the complaint (Sheffield Metropolitan District Council v Siberry and Smith EAT (1989) ICR 208).

Since July 1996 however, tribunals have had the option of determining the equal value question themselves (s.2(1)(A) as amended, see box). The consequences of this change have been elaborated on for the first time at appellant level by the EAT in Wood and others v William Ball Ltd (EAT/552/98).

In this case, eight cleaners/packers and a supervisor compared their work to that done by male pickers/packers employed by a kitchen manufacturer. The employment tribunal refused to refer the claim to an independent expert because in its view there were no reasonable grounds for determining that the work was of equal value, and dismissed it. Under the pre-1996 regime, this decision was unchallengeable. However, under the new regime, said the EAT, "the fact that a tribunal has concluded that there was no reasonable prospect of the applicants showing that their work was of equal value with the comparator, did not thereby put an end to the case, but permitted the parties themselves to adduce expert evidence in support of their claim which they could adduce at a further hearing." In other words, the issue of "no reasonable grounds" can only arise in those cases in which an employment tribunal is minded to refer to an independent expert.

The EAT added that the 1996 changes contemplate a two-stage process. "The first part is to decide whether an expert's report is to be obtained by the tribunal itself or by the parties themselves. If it is to be by the parties themselves, then the tribunal will have to determine the case on the basis of the evidence presented to it." It was plainly Parliament's intention, said the EAT, that "rather than the parties litigating this issue at the Government's expense - that is, at the expense of the tribunal arranging an expert to determine the issues - the parties themselves should be free to do so. It was unlikely that the parties would themselves have gone to the expense of investing in an expert's report before making an application to the tribunal that it should obtain a report itself and, therefore, it must have been Parliament's intention that the mere fact that an applicant failed to persuade a tribunal to order an independent report would not mean that the tribunal might not in due course reach a completely different conclusion based on expert evidence which the parties then produced."

In this case, the EAT held that the tribunal had "moved from stage one, which is to ask whether they should commission a report, in which case, the proceedings would have to be adjourned for that purpose, to stage two, namely to determine the matter themselves without giving the parties an opportunity to adduce expert evidence if they wish to do so". Upholding the appeal, the EAT remitted the case back to a new tribunal for consideration of such expert evidence as the parties wished to adduce.

It would appear that the effect of the EAT's decision is to remove the power of the tribunal to weed out the "hopeless" cases, something which the EOC has argued for since 1990 (see its latest reform proposals above). The likely consequence is that all equal value cases, no matter how weak, will be adjourned following a preliminary hearing to allow the parties time to instruct their own experts. Whether this was really Parliament's intention is open to doubt. Prior to the change in the rules, the then employment minister, Anne Widdecombe, had made it clear to the EOC that the Government was attracted by the proposal to abolish the "no reasonable grounds" test, "provided adequate powers remain to prevent obviously hopeless cases from proceeding", ie cases which would not otherwise be struck out because they were frivolous or vexatious. Under the EAT's formulation, it seems that even the "obviously hopeless" cases will be adjourned to give the parties the opportunity to adduce their own expert evidence.

Tribunal determines equal value

In the period from July 1996 to the end of 1998, tribunals have chosen to exercise their discretion under s.2(1)(A) and determine the equal value issue without resort to an independent expert in around eight cases, with the number of applicants varying from one to four (see box for examples of the jobs that were compared). Clearly, the length of time it takes to determine the issue of equal pay is cut significantly when tribunals opt to deal with the equal value issue themselves (though, in the light of the EAT's decision in Wood, above, proceedings in cases which would have been dismissed at an initial preliminary hearing under the pre-1996 "no reasonable grounds" test, will obviously be lengthened). The avoidance of delay and the consequent expedition of claims was a significant factor in the decision not to refer the equal value issue to an independent expert by a Bristol employment tribunal in Bragg v St Monica Home of Rest (DCLD 35)

In favour of a reference, said the tribunal, "is that the independent expert would be able either to agree or to decide the criteria and might be able to reduce the number of comparators. In a difficult case, which we consider this to be, the presence of the independent expert would be an additional protection to ensure justice." Against the appointment was the question of delay. The tribunal believed that "the appointment of an independent expert would substantially delay the hearing of this case and that it is likely that it would not shorten the final hearing because there is the likelihood of three views being expressed by three different experts which would then have to be resolved by the tribunal." Proceeding to a hearing and avoiding a reference to an independent expert was "the most expeditious and efficient method of dealing with this case," said the tribunal, deciding not to refer the equal value issue to an expert.

However, when tribunals decide to use this discretion, they are likely to adjourn proceedings so that the parties' experts can carry out their assessment of the jobs. In Bragg, for example, the case was adjourned for five months. Similarly, in Henry v University of Leeds (DCLD 35), a Leeds employment tribunal rejected the equal pay claim by a female cleaner who compared her work with that of a male maintenance worker, five months after the original decision not to refer the equal value issue to an independent expert.

Cross-examination

In cases where each side has its own expert who disagrees with the other on the issue of equal value, much of the tribunal hearing is likely to be taken up with cross-examination of the experts. In Henry, a "great deal of time" at the five-day equal pay hearing was taken up with cross-examination of the expert witnesses relating to their method of valuation of work done by the applicant and comparator. The tribunal considered it "vital to compare the credibility of the conclusions that were drawn by the expert witnesses." In so doing, the tribunal preferred the conclusions of the respondent's expert, finding the report produced by the applicant's expert to be "flawed".

It found that the applicant's expert "had not interviewed the comparator himself but a fellow employee, Mr Rogers. She had not shadowed the comparator (nor indeed Mr Rogers) on a typical working day. When she had drafted her conclusions as to the job description, these were returned to Mr Rogers and not the comparator." In comparison, the respondent's expert "interviewed both the applicant and the comparator himself, shadowing both of them on a typical day's employment. When he drew initial conclusions as to their job description these were returned to the applicant and the comparator himself for their comments." On the basis of the respondent's expert's report, the tribunal found that the comparator's job was of greater value than the applicant's job.

In McKechnie and others v Gloucestershire County Council (5 September 1997; case no.12776/96 and others), the two experts were once again in conflict. Here, three nursery nurses and a special support assistant compared their work with that of a waste technician and an architectural technician. Again, there was a five-day hearing with much of it devoted to cross-examination of the two experts. The expert for the applicants in this case was Sue Hastings, the same expert in Henry above. This time the employment tribunal preferred her evidence to the evidence submitted by the respondent's expert. However, the difficulties that arise when a claim is not referred to an independent expert were highlighted by the tribunal in this case.

Each expert adopted a different basic method of comparison of the various jobs, with somewhat different criteria in a number of respects. Consequently, "it was not always easy to compare their views on a particular point by translating one expert's evaluation into the terms adopted by the other," said the tribunal. Moreover, added the tribunal, "both experts prepared their own detailed job description of the applicants and the comparators; and it became apparent during the course of the evidence that the various job descriptions contained, at the very least, some differences of emphasis which meant that the respective experts occasionally found themselves working from basic premises which were not identical."

As a result, both experts were cross-examined at length upon the individual areas of assessment where they had reached different conclusions. Though this was time-consuming and posed certain difficulties, nevertheless the equal value decision (that each applicant was employed on work of equal value to both comparators) was made after a five-day hearing, and was not subject to lengthy delay by the appointment of an independent expert.

One expert

It does not always follow that each side will have its own expert. In Hicking v Basford Home Fashions Ltd, for example, the employer chose not to appoint its own expert. It provided the applicant's expert (once again, Sue Hastings) with assistance and challenged at the subsequent tribunal hearing her finding that the applicant, a female warehouse operative, was employed on work of equal value to that of a male warehouse worker.

The employer's principle attack on Ms Hasting's report was that physical effort should be weighted more highly than other elements of the equation because warehouse work was all about physical effort. Indeed, the employer's original justification for paying the applicant less was because the men did heavy lifting and she did not. However, the tribunal entirely rejected the submission which, if correct, "would have the result of perpetuating inequality of pay in an environment where muscle power is a factor." It added that it "may well be the case that there are certain jobs which are of a particularly heavy nature or the lifting of heavy weights occurs with far greater than normal frequency when it may be permissible to weight physical effort more highly. But we heard nothing to suggest that there was any proper basis for weighting physical effort more highly than mental effort in the case of the warehouse operatives. And whereas possibly some of the men did heavier lifting than Mrs Hickings there is no doubt whatever that Mrs Hicking did work requiring considerably greater mental effort than anything done by the males."

Genuine material factor defence

An employment tribunal may reject the equal value claim at the preliminary hearing if it can be shown that the difference between the applicant's pay and the comparator's pay is genuinely due to a material factor which is not the difference of sex" - the GMF defence (s.1(3)). At this stage, the tribunal will assume for the purposes of the GMF defence that jobs being compared are of equal value. The defence may be raised at a later stage, following the independent expert's report. However, if the defence is raised as a preliminary point it will not be reopened at the later stage "other than in exceptional circumstances"(Rule 9(2E), Schedule 2 of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993, as amended).

A showing of work of equal value (whether assumed or found) shifts the burden to the employer to prove a non-discriminatory and material reason for the difference in pay.

Objective justification

One of the key issues which has vexed the courts over many years, as regular readers of these updates will know, concerns objective justification: Does the statutory requirement that the variation must be genuinely due to a "material" factor mean that the employer must, in any event, show that the difference in pay is objectively justified, even though the variation in pay is not based on sex? In other words, is it sufficient that the employers reason for the variation is not sex discriminatory or is there a requirement that the reason be objectively justified?

There are conflicting decisions. In Tyldesley v TML Plastics (EOR 68), for example, the EAT overruled an employment tribunal which found that the employer's genuine belief that a male comparator had more experience of particular management system was not a ground for paying him more because it was not objectively justified. According to the EAT: "This approach places an additional burden on the employer to establish the defence under s.1(3) which is not expressly stated in the relevant statutory provisions." In its view, in the absence of a suggestion that the factor relied on to explain a pay differential was indirectly discriminatory, no requirement of objective justification arises. "If a genuine mistake suffices, so must a genuine perception, whether reasonable or not, about the need to engage an individual with particular experience, commitment and skills."

However, the Court of Appeal of Northern Ireland took a very different view in McPherson v Rathgael Centre for Children and Young People (EOR 37). In this case there was no element of gender discrimination in the factor relied upon by the employer in mounting a s.1(3) defence. The pay difference was due to a simple mistake. The Court of Appeal held that the employer had to justify such a disparity and had failed to do so.

The conflict has now been resolved by the House of Lords in Strathclyde Regional Council v Wallace and others (EOR 78), with the Court preferring the Tyldesley approach over the McPherson approach, ruling that employers do not have to objectively justify a pay difference which is not tainted by sex discrimination.

In this case, the appellants, nine women teachers, performed the duties of a principal teacher. However, none of them was appointed to the position of a principal teacher and none of them received the salary appropriate for the holder of an appointment as a principal teacher. They were among a group of 134 unpromoted teachers who claimed to be carrying out principal teachers' duties, 81 of whom were men and 53 women. They brought equal pay claims, identifying at least one male comparator who had been appointed as a principal teacher and was receiving a salary appropriate to that responsibility. The employment tribunal found that the applicants had been performing like work.

Given the gender composition of the unpromoted teachers, it was an agreed fact that the disparity in pay was not based on sex. The employer argued that the variation in pay between the applicants and their male comparators was due to a combination of material factors. These included that the promotion structure for teachers was established by statute and posts were filled only on merit after competition, and that financial constraints prevented the applicants from being appointed principal teachers when it might have been appropriate. The tribunal took the view, however, that the employer had not established a material factor defence as required by s.1(3). The EAT dismissed the employer's appeal but the Court of Session allowed the employer's appeal on grounds that the employment tribunal had erred by searching to see whether there was an objective justification for the aspects of the system of working on which the employer relied.

The House of Lords dismissed the employer's appeal. Lord Brown-Wilkinson's decision for the Lords emphasises that "the question of justification only arises where a factor relied upon is gender discriminatory". Section 1(3) provides a defence if the employer shows that the variation between the woman's contract and the man's contract is "genuinely" due to a factor which is (a) material and (b) not the difference of sex. The requirement of genuineness is satisfied if the tribunal comes to the conclusion that the reason put forward was not a sham or pretence. For the matters to be relied upon to constitute "material factor", it has to be shown that they were in fact causally relevant to the difference in pay, ie that they were significant factors. This is a test which looks to the reason why there is a disparity in pay and not whether there is an excuse for such a disparity. Finally, the employer has to show that disparity in pay is due to a factor "which is not the difference of sex", ie is not directly or indirectly sexually discriminatory.

In this case, the factors relied upon by the employer were undoubtedly genuine reasons for there being a difference in pay. They were also significant and causally relevant factors leading to that disparity, and they did not relate to sex in any way.

Direct discrimination

Wallace was about whether an employer has to justify a pay difference which is not discriminatory. It was not about when an employer can justify a pay difference which is discriminatory. Nevertheless, this is an issue which Lord Browne-Wilkinson pronounces on. He said that the correct position under s.1(3) is that "even where the variation is genuinely due to a factor which involves the difference of sex, the employer can still establish a valid defence under subsection (3) if he can justify such differentiation on the grounds of sex, whether the differentiation is direct or indirect".

It is trite law that indirect discrimination in pay - as when a women-dominated group is paid less than a male-dominated group - can be objectively justified, but no court has held that direct discrimination in pay is capable of justification. As we argued in our comment on the case in EOR 78, to imply such a right for employers into s.1(3) represents a substantial loosening of the burden on the employer. This would drive a coach and horses through s.1(3) and cannot possibly be warranted, given that the statute explicitly requires that the pay variation must be genuinely due to a material factor "which is not the difference of sex". Lord Browne-Wilkinson's comment was not necessary for the decision of the House of Lords. Therefore, it is not binding on lower courts. In our view, it should not be treated as such.

Partial justification

It is often the case that a pay differential is partly due to discrimination and partly due to genuine factors. Once work of equal value has been established, it is up to the employment tribunal to determine, according to the evidence before it, which parts of the differential are genuinely due to the genuine material factor and which are not (Enderby Frenchay Health Authority (EOR 52)).

In McKechnie and others v Gloucestershire County Council, above, the employer argued that the difference in pay between the applicants and one of the comparators, which ranged from £6,261 to £7,071, was due to the difference in hours worked per week and the difference in weeks worked per year. The comparator worked a 39-hour week over a 52-week year, whilst the applicants worked 32.5 hours a week for 39 weeks of the year, to coincide with school terms.

The tribunal upheld the defence in part, finding that part of the difference was due to the sex of the workers concerned. Taking one of the applicant's, Ms Whelan, as an example, the tribunal said: "She is entitled to be paid for 39 weeks' work plus seven-and-a-half weeks' notional holiday entitlement, making a total of 46.5 weeks in all. She works 32.5 hours per week, which means that she is entitled to be paid for a total of 1,511.25 hours. For that, she receives a notional hourly rate of £7.89, giving her an annual salary of £11,919. If she were paid for those hours at Mr Morse's [the comparator] notional rate, calculated on the same basis, of £9.45 then she would receive the sum of £14,281.31, leaving a shortfall of £2,362.31. Of course, the 'raw difference' between Ms Whelan's pay and Mr Morse's pay is significantly more than that: the difference between £11,919 and £18,180, which is £6,261."

"On the basis of that calculation, it seemed to us that the difference between £14,281 and £18,180 was indeed due to the difference in the length of the working week and the length of the working year. Even if Ms Whelan were paid the identical hourly rate to that paid to Mr Morse, that difference would still exist and for that reason. On the other hand, that discrepancy between what Ms Whelan actually earns, and what she would earn if she were paid at the same hourly rate as Mr Morse in respect of those hours for which she is contractually entitled to be paid, cannot be said to be due either to the difference in hours worked per week, or to the difference of weeks worked per year."

Material factor

Below we look at some of the reasons advanced by employers to justify unequal pay since our last update. These cover: market forces; different employment histories; shorter working week/hours; cost; and employment on all-year-round contracts rather than term-time contracts.

Market forces

It is clear that market forces may justify paying different rates to those employed on equal work (Enderby v Frenchay Health Authority (EOR 52)). However, where the market forces themselves depend on factors that discriminate against women the defence will not succeed, as Halloran v Corporation of London (DCLD 39) shows.

Eileen Halloran was employed by the Corporation of London at the City of London School for Girls from 1973 until her retirement in 1995. The salary scale for teachers at the girls' school, where 81% of the teachers were female, was lower than that at the Corporation's boys-only City of London School, where 87% of the teachers were male. At the time she retired, the applicant was head of physical education, receiving a basic salary of £22,497. The head of physical education at the boys' school, Ronald Bailey, received a basic salary of £29,505. Ms Halloran successfully claimed equal pay.

The employer contended that the difference in pay was due to a genuine material factor which was not the difference of sex, arguing that the two schools were operating in different markets and that the differences in pay were determined by the need to pay higher salaries to attract teachers to the boys school. Rejecting this argument, the tribunal accepted the applicant's submission that the market forces in this case depended themselves "on factors which discriminated against women". In any case, "the differing pay scales clearly amounted to indirect discrimination against women" and could not be objectively justified.

Similarly, in Commons v Armitage & Rhodes Fabrics Ltd (DCLD 37), a Leeds employment tribunal ruled that an employer was not entitled to rely upon market forces as a defence for paying a woman less than a man where the market forces were based upon the going rates for women and men.

Debra Commons was employed as a warehouse operative in August 1995 at a starting salary of £10,000 per year. Her pay was increased to £11,000 in April 1996. She brought an equal pay claim comparing herself to a male warehouse operative who was taken on in March 1996 at a salary of £12,000. The tribunal found that the employees were employed on like work and rejected the employer's defence based on market forces. It noted that the managing director testified that when he employed warehouse operatives, he paid each of them by reference to what he described as "market forces for him, market forces for her". The tribunal regarded this as meaning that the market forces on which the employers relied "were entirely those which were 'the difference of sex'." The director was saying that "it was possible to obtain the services of a competent female warehouse operative for £2,000 per annum less than he was required to pay an equally competent male warehouse operative." Thus, the difference in salary arose "purely because the going rate for male warehouse operatives was substantially more than the equivalent going rate for female warehouse operatives".

Different employment histories

In Farrer v J Tomlinson & Son Ltd (DCLD 38), a Leeds employment tribunal upheld the employer's GMF defence based in part on the different employment histories of the applicant and his female comparator, a secretary employed on work of equal value.

The male applicant, a joiner, was engaged by the respondent at the end of 1989. He was considered to be a sub-contractor rather than an employee, and so was not entitled to employee benefits such as holiday pay and sick pay, but was entitled to a higher rate of pay than if he had been an employee. In 1996, the company reassessed the status of its sub-contractors, in the light of an Inland Revenue clampdown on the construction industry. The applicant was one of a number of sub-contractors recategorised as an employee by the company. Consequently, he was offered £5.85 an hour - £1.30 less than his rate as a sub-contractor - plus benefits, including holiday and sick pay. However, he refused to accept the reduction in pay and continued to be employed at the higher rate without employee benefits. He claimed equal pay with a female secretary, who was on a lower hourly rate of pay than him, but who, as an employee, was entitled to holiday pay and sick pay. She also had the right not to be laid off, whereas the respondent was contractually entitled to lay off the applicant when there was a downturn in work, in accordance with the industry's Working Rule Agreement. An independent expert concluded that the applicant and his comparator were employed on work of equal value. At the resumed tribunal hearing, the employer successfully argued that there were genuine material factors that justified the differences in holiday and sick pay entitlement.

In respect of the differences in holiday and sick pay, the tribunal ruled that there were "a number of different genuine material factors … all of which had no connection with the sex of the applicant and his comparator". These included: "(i) The different employment histories of the applicant and his comparator, that is in the case of the applicant, as a self-employed contractor from 1989, and in the case of the comparator, having always been employed and been treated to have been employed from the start of her employment, as an employee. It was for this reason that the differences in terms occurred."

Cost

In Rees v National Westminster Bank (DCLD 37), a Bedford employment tribunal rejected the employer's defence that the reason a female part-time employee was paid a lower hourly rate for the hours worked in excess of contracted hours than a full-time male employee employed on equivalent work was because a change in policy would result in increased costs and administrative difficulties.

Kay Rees, a clerical worker with the bank, was employed at grade six on a part-time term-time working contract. There were no men working part-time at this grade. Mrs Rees' contractual hours were 9.30am to 1.30pm Monday to Thursday. Her hourly rate of pay for her contracted hours was the same as that as her male comparator. However, whereas he was paid a premium rate for any additional hours worked over his contractual hours, she was paid at the ordinary hourly rate, unless she worked in excess of seven hours in any given day, whereupon her excess hours were paid at premium rates. She claimed equal pay with a male grade-six full-time clerical worker. All grade-six jobs were rated as equivalent following a job evaluation study.

The employment tribunal upheld her claim, rejecting the bank's argument that the difference in pay was due to a genuine material difference, ie were it to change its policy to include contractual benefits paid for excess hours there would be a resultant increase in costs and practical difficulties in administering such a revised scheme. In the tribunal's view the bank failed to show any evidence that the difficulties and the increased costs to which it alluded caused the variation in pay.

All-year-round contract

In Hewish v Corporation of Southwark College (25 July 1997; case no. 41725/96), the employment tribunal accepted the employer's defence that the difference in pay between the applicant, a female part-time lecturer in information technology, and her comparator, a part-time male lecturer in health studies, was due to him being employed on an all-year-round contract, which meant that he was obliged to work or be available to the college for an extra six weeks a year more than the applicant, who was employed on a term-time working contract. This provided him with an extra 66 hours' pay in respect of weeks during which the applicant was not paid at all. The tribunal found that there "was a contractual obligation on [the comparator] to work as and when required during non-term time. In his evidence he stated that he did go into the college during the non-term time and worked there. He did prepare a new course for the college. The applicant did not go into college in non-term time and could not have been required to do so. Taking all these factors into account, we are satisfied that there was a material factor difference between the applicant's contract and her comparator and that difference was not connected with sex."

Independent expert

The independent expert's task differs from that of someone carrying out a full job evaluation study in a number of ways. For instance, a conventional system will be designed to cover a wide range of jobs whereas independent experts are likely to be considering a very narrow range and so their factor coverage will be restricted accordingly. Another major difference is that a conventional scheme is concerned with relative values, placing a substantial number of jobs in an order which indicates the extent of the differences in values between them for payment purposes. An independent expert is concerned with comparative value and will look at the jobs to be compared in isolation from the other jobs in the organisation to see whether they are of equal value or not.

An independent expert also has considerable latitude in devising an appropriate method of evaluation. However, this is subject to the procedural requirement that they evaluate the jobs being compared analytically, ie "in terms of the demands made on that person employed on the work (for instance, under such headings as effort, skill and decision" (Rule 8A(1) Schedule 2 of the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993, as amended).

In addition, the procedural regulations require that the independent expert shall: "(a) take account of all such information supplied and all such representations made to him, as have a bearing on the [equal value] question; (b) before drawing up his report, produce and send to the parties a written summary of the said information and representations and invite representations of the parties upon the material contained therein; (c) make his report to the tribunal in a document which shall reproduce the summary and contain a brief account of any representations received from the parties upon it, any conclusion which may have been reached upon the question and the reasons for that conclusion, or as the case may be, for the failure to reach such a conclusion; (d) take no account of the difference of sex and at all times act fairly."(Rule 8A(3)).

Generally, independent experts have opted to follow a simple evaluation procedure using the minimum number of factors which will allow an examination of the principal job demands. Factors and sub-factors appropriate to the applicants and comparators' jobs are identified and defined. In order to measure the extent of the differences, both in respect of a particular factor, and as between factors, these are then normally divided into a number of levels and numerical values attached to each level, allowing a total value to be identified. Usually, the independent expert will stress that the numbers allocated do not represent point scores as in a points rating scheme. They merely serve to illustrate the overall "profile" of the jobs in terms of comparative demands.

There are few instances where the factors have been directly weighted, though inherent weighting whereby some features have more sub-factors than others is more common. Just as in conventional job evaluation, the factors chosen should ensure that the significant characteristics of the two jobs in question are covered in a way that will avoid double counting and gender bias.

Job description

A prerequisite for any evaluation exercise is a detailed description of the applicant's and the comparator's jobs. Job descriptions are usually drawn up, based, wherever possible, on a variety of sources including observation of the jobs being carried out and existing job descriptions. Within a full job evaluation exercise job descriptions are normally agreed through a consultative process. In an equal value case, it is rare for the parties' views to be totally reconciled unless there are earlier agreed job descriptions in place.

Problems arising from the independent expert's failure to prepare their own job descriptions and relying instead on the descriptions provided by the parties, have been highlighted by the employment tribunal in the speech therapist cases. Echoing its earlier comments in Evesham (see Equal value update - EOR 76), the employment tribunal in Worsfold v Southampton District Health Authority and the Secretary of State for Health found that the independent expert's failure to write his own job descriptions contributed to his findings of fact being subject to strong questioning. In Lawson v South Tees District Health Authority and the Secretary of State for Health, above, the effect of the independent expert's failure to prepare his own job description was that the tribunal had difficulty in linking his findings of fact to both his assessments and his ultimate conclusions. In both cases the tribunal found that the failure led to the independent expert's report being challenged on grounds of admissibility.

The failure of the independent experts to prepare their own job descriptions added to the complexity of the cases and lengthened the proceedings. As we have seen, the tribunal in Lawson put forward a number of amendments aimed at simplifying and streamlining the procedure, including giving tribunals the power at the preliminary hearing, to order that a job description be prepared by an independent expert of both the applicant's and the comparator's jobs. It added that the job description should be in a standard format, with the duties and responsibilities of the job identified under common headings, and prepared in consultation with the parties and their line managers.

The reason for the latter proposal was explained by the tribunal in its earlier decision in Worsfold. It is "important that the applicant should be satisfied that her job has been consistently described in similar terms to that of the comparator. A failure to do this has particular impact where the jobs are found not to be of equal value and the applicant may in those circumstances consider that justice has not been done," said the tribunal. So, "in order to ensure that justice is seen to be done, as well as done, job descriptions should be available to both parties and as far as possible in a standard format".

Independent experts tend to stress from the outset that job evaluation is "not an exact science" and that it is possible for someone else, in their analysis of the demands made to arrive at a marginally different assessment of demand level. Nevertheless, even where the difference in the numerical value of the jobs being compared is small, independent experts will usually refrain from concluding equal value, see Lawson and Worsfold, below. One of the few exceptions to this is Monger and Grocock v National Union of Teachers (27 March 1997; case nos. 18601/95 and 18602/95), above, where the independent expert took the view that the marginal difference was not sufficient to conclude that the jobs compared were not of equal value.

Below, we look at the independent expert's approach and findings in Monger, Lawson and Worsfold, as well as Farrer, above. In all four cases, the tribunal went on to decide the issue of equal pay, although in the two cases involving speech therapists the issue of remedies has still to be resolved.

Joiner v secretary

In Farrer, as we have seen, a male joiner compared his job with that of a female secretary. On the basis of initial job descriptions supplied by the employer and on-site visits, for discussions with management and two days spent watching the applicant and his comparator perform their jobs, the independent expert identified the following seven factors:

Each factor was defined and split into four levels with a numerical value attached "to assist the tribunal's understanding" - high (four), medium-high (three), medium-low (two) and low (one), with the opportunity to allocate "+" (0.5), as appropriate, to show the assessment inclined midway upwards. No weightings were added to the factors.

On this basis, out of a maximum score of 28, the joiner scored 19 and the secretary scored 16.5. Therefore, said the independent expert, the applicant was employed on work of at least equal value to that of his comparator.

Clerical v storekeeper/caretaker

The independent expert's method of enquiry in Monger, where two female clerical and administrative workers were claiming equal pay with a male caretaker and a male storekeeper, called for "retrospection all round" as the applicants' jobs had been placed on the same grade as their comparators and the scope and range of their activities increased, since their originating application to the tribunal. Consequently the independent expert's assessment focused on a perception of "what was", going back at least 12 months, rather than "what is". However, this is not an unusual situation for independent experts, see the speech therapist cases below.

Both sides presented the same set of job descriptions for the comparators and different ones for the applicants. Following face-to-face interviews with the applicants, the comparators and management at their place of work, the independent expert considered that it was not necessary to draw up a further set of job descriptions for the applicants and the comparators, preferring the applicants own job descriptions.

From the job descriptions and her on-site observations and interviews, the independent expert identified and defined the same seven factors, with the same four levels, used in the Farrer case above. This is perhaps not surprising, as the independent expert was the same in each case. In contrast to her approach in Farrer, however, the independent expert chose to give less weighting to the working environment factor, assessing it as half that of the other factors. Without the weighting the clerical/administration job scored 30 compared with 33 for the storekeeper and 37 for the caretaker. However, the effect of the weighting, was to impact on the comparator's jobs disproportionately and reduce the unweighted scores to 29, 30 and 33 respectively.

Eschewing a literal definition of "equal", the independent expert concluded that the clerical/administration job was of equal value to that of the storekeeper job. Looking "at the result in the round", said the independent expert, the difference between the clerical/administration job and the storekeeper job was not "significant in terms of overall value to rank them other than at the same level".

Speech therapist v psychologist/ pharmacist

A unique feature in the speech therapist test cases has been, at the request of the London South employment tribunal dealing with these cases, the adoption of a common approach and methodology by the nine independent experts providing reports in their individual cases. In making the request, the tribunal sought to avoid the basic criticism that each expert followed a different methodology.

The independent experts have adopted six factors and 14 sub-factors. They are:

- Knowledge base

- Development

- Experience

- Responsibility for patients/clients and the provision of a service.

- Managing work of self and others

- Plant/equipment/resources

- Teacher training mentoring

- Concentration/accuracy

- Stress/pressure

- Physical effort

- Working conditions

- Hazards

- Complexity/analysis

- Freedom to act

For definitions of the factors and sub-factors see our previous equal value update. Although there is no explicit weighting of factors, the inclusion of different numbers of sub-factors for different factors places differing weighting on the main factors. This ranges from 26.7% for responsibilities to 6.7% for communications/relationships. Each sub-factor has been allocated five levels of demand with numerical values - one (low) to five (high).

Worsfold

In Worsfold, the applicant, a senior speech therapist, was still employed in essentially the same position in 1996 as in 1987, the date of her originating application. Her comparator, a principal clinical psychologist, had moved to a similar role with a different authority. The focus of enquiry was on the "now" though the work to be assessed related to the situation in 1987. The independent expert carried out a sequence of interviews and observations of the applicant and comparator, whilst interviewing, assessing and providing therapy to a range of patients similar to those dealt with in 1987. The independent expert, as we saw above, did not write his own job description, but relied upon the descriptions provided by the parties' experts.

Assessing the jobs, in terms of the agreed factors and sub-factors, the independent expert found that the comparator scored 56.5 and the applicant scored 54. The independent expert in coming to his conclusion acknowledged that when deciding on "equal" value a small difference may be difficult to justify "not least because the process of analysis and assessment of jobs is not an exact quantitative science". Nevertheless, unlike the independent expert in Monger, above, he was unable to conclude that anything less than 100% was equal value. In his view, therefore, given that she had scored 95.57% of the comparator's score, the speech therapist's work was not of equal value to his.

Lawson

In Lawson, where a specialist speech therapist compared her work with that of a principal pharmacist, the independent expert, who again relied on the job descriptions provided by the parties, found the marking system too crude and therefore added three sub-levels for every sub-factor. Consequently, the total score for each sub-factor was 15 rather than five.

Assessing the jobs in terms of the 17 sub-factors, the independent expert scored the applicant at 154 and the comparator at 161. The mere fact that there was a difference led the independent expert to conclude that the jobs were not of equal value. However, in doing so, the expert felt obliged to make a cautionary comment: "In order to be able to aggregate sub-factor values, numbers have had to be attached. These can give an impression of exactness or precision which is not entirely justified as the basic assessments are, to a great extent, matters of subjective, albeit neutral, judgement".

Final hearing

Once the independent expert has reached a conclusion on the value of the jobs compared, and has submitted a report to the employment tribunal, the tribunal will reconvene to consider three issues. First, whether or not to accept the report and admit it in evidence. Secondly, whether, once it has admitted the report, it agrees with the independent expert's conclusion on equal value. When admitted in evidence, the independent expert's report will carry considerable weight. However, it is not part of the tribunal's duty simply to endorse the report (see Tennants Textiles Colours Ltd v Todd, EOR 23). It will base its decision on all the evidence, including the reports of the expert witnesses called by the parties and, finally, any GMF defence (remember, if the defence is raised as a preliminary point, it will not normally be reopened subsequently).

The main issues arising since our last update concern the admissibility of the report and the meaning of "equal".

Admitting the report

The tribunal may refuse to admit the report on the grounds that the expert has not complied with stipulations set out in Rule 8A(3), above; or that the report's conclusion is one which, taking due account of the information supplied and representations made to the expert, could not reasonably have been reached; or that for some other material reason (other than disagreement with the conclusion of whether or not the applicant's work is of equal value or with the reasoning leading to that conclusion) the report is unsatisfactory (Rule 8A(13)). Where the report is not admitted, the tribunal is required to issue a fresh requirement for a report by an independent expert to be prepared. In all four of the above cases the reports were admitted in evidence.

In Lawson and Worsfold, both applicants argued that the report was unsatisfactory and therefore should not be admitted in evidence, because the facts on which the independent experts had drawn their conclusions were not clear. As we have seen above, the tribunal believed this lack of clarity derived partly from the failure of each independent expert to write their own job descriptions and relying instead upon the descriptions provided by the parties.

However, the tribunal, conscious of the further delay to the determination of the cases that would occur if it were not to admit the report and issue a fresh requirement for another report, rejected the applicants' submission. In both cases, the rejection came only after some robust cross-examination of each of the independent expert's by the applicant's legal representative. In Lawson, the cross-examination of the independent expert on the facts, led the tribunal to issue a further requirement to the independent expert, under Rule 8A(15), to explain all the facts on which he based his conclusions with regard to each factor and sub-factor.

"Equal" value

Following its own analysis, the employment tribunal in Worsfold, adjusted the independent expert's scores so as to increase the assessment for the applicant to 55 and to confirm, by a slightly different approach, the assessment of the comparator at 56.5. On a literal interpretation, the applicant's job and the comparator's job were clearly not "equal". Nonetheless, the tribunal ruled that the applicant and her comparator were employed on work of equal value.

In the tribunal's view, jobs are not of equal value where there is "an overall measurable and significant difference between the demands of the respective jobs". The issue here was what constitutes such a difference, and in so deciding, the tribunal took into account two factors.

The first factor was whether the wording of the definition of equivalent work under s.1(5) of the EqPA is similar to the definition of equal value under the EC Equal Pay Directive. Secondly, the EAT's dicta in Springboard Sunderland Trust v Robson (EOR 44), that equal value under a job evaluation scheme should not be interpreted as a direct equivalent in score or greater, but should be assessed in broad terms in a practical setting. Therefore, in the tribunal's view "an overall measurable and significant difference is one which the tribunal would expect to see reflected in the real world in the terms of employment for which equality is sought, such an assessment having been made free of gender bias and having taken into account any material factor difference." Applying this definition here, the tribunal found that "there is no such overall measurable and significant difference in the demands made upon Mrs Worsfold as compared to her comparator."

The tribunal adopted the same approach in Lawson. It held that the difference in scores of less than 5% did not constitute an "overall measurable and significant difference between the demands of the respective jobs". In its view, "it would not expect to see the difference in demands of these two jobs reflected by a difference in the terms of employment". Accordingly it held that the applicant was employed on work of equal value with her male comparator.

Subsequently, the respondents challenged the tribunal's approach on appeal to the EAT. However, finding no error of law, the appeals were dismissed in a judgment delivered on 28 April 1999.

Remedies

If the employment tribunal upholds an equal value claim an equality clause will operate with the effect that "any term of the woman's contract" which is less favourable to the woman "than a term of a similar kind in the contract under which that man is employed" is modified so as to be not less favourable (s.1(2)(c)).

According to the EAT in Evesham v North Hertfordshire Health Authority and Secretary of State for Health (DCLD 39), this means that the terms of the successful equal value complainant should mirror those of her comparator.

Evesham, you may recall, was the first speech therapist case in which equal value was found by the employment tribunal, see p.21. The applicant, a district chief speech therapist, compared herself with a district (top grade) clinical psychologist, who at the time the claim was first presented in 1987 was in his first year, compared with the applicant's six years of service at the relevant date. At a subsequent remedies hearing, the applicant contended that, her work having been found to be of equal value to that of her comparator, she should be paid not the same as him but in the salary range for clinical psychologist of his grade. She should enter it, not where he was, at the bottom rung because he was newly in post, but at the level commensurate with her six years of service and annual increments in her speech therapy post.

The employment tribunal ruled that the applicant's remedy entitled her to be paid the same as her comparator at the date of her claim and to have the benefits thereafter of the same annual increments as he received. On appeal, it was argued that Mrs Evesham was entitled to be placed on the pay scale for clinical psychologists, but at a point commensurate with her years of service as a speech therapist. The EAT rejected this, pointing out that what Mrs Evesham had established was that she was employed on work of equal value with her comparator and not with all district clinical psychologists of his grade. Therefore, her entitlement was to join the incremental scale where her comparator stood on the relevant date (the date of the originating application - 6 April 1987) and to enjoy the same entitlement to incremental progression as her comparator.

As the EAT put it, if "Mrs Evesham were to enter, at the relevant date, the pay scale enjoyed by her comparator but at an incremental level higher than her comparator, the effect would be that from that date she received pay at a level in excess of that received by her comparator with whom she had established equal value, and commensurate with the pay scale of somebody with whom she had not established equal value."

Arrears

Prior to the EAT's decision in the joined cases of Levez v TH Jennings (Harlow) Pools Ltd and Hicking v Basford Group Ltd (in receivership), a successful applicant under the EqPA was not entitled "to be awarded payment by way of arrears of remuneration or damages in respect of a time earlier than two years before date on which the proceedings were instituted" (s.2(5)). The EAT's ruling in Levez and Hicking however, extends the two-year limit to six years - trebling the size of the potential awards in equal pay cases.

At the time of our previous update, we were awaiting the outcome of the challenge under EC law to the limit on back pay referred by the EAT to the European Court of Justice (ECJ) in Levez. In that case, Belinda Levez commenced employment as a betting-shop manager on 18 February 1991 at a salary of £10,000. In December 1991, she was transferred to another branch. Her salary was increased to £10,800, which she was incorrectly informed was what her male predecessor had been paid. In fact his salary had been £11,400. It was not until April 1992 that Mrs Levez's salary was increased to that level. In March 1993, Mrs Levez left her employment. She discovered that she had been paid less than her male predecessor until April 1992 and brought tribunal proceedings on 16 September 1993. The two-year limit meant that pay arrears ran from September 1991, even though she had been on unequal pay since February 1991. On appeal, she argued that a reference should be made to the ECJ on the question of whether Article 119 of the Rome Treaty and the EC Equal Pay Directive permit such a limitation on damages in equal pay cases. The EAT agreed.

The ECJ pointed to the fundamental principle of Community law that rules of procedure governing Community law rights are for the domestic legal system of each member state to determine. However, that principle is subject to qualification. In particular, that such rules are not less favourable than those governing similar domestic actions (the principle of equivalence).

The principle of equivalence was restated by the Court in Levez as requiring that "the rule at issue be applied without distinction, whether the infringement alleged is of Community law or national law, where the purpose and cause of action are similar". The question of what is the appropriate comparison was left by the ECJ to be determined by the national court.

Shortly after the ECJ's ruling, a Nottingham employment tribunal in Hicking ruled that s.2(5) did not offend the principle of equivalence, and limited its award for breach of the equality clause to two years' back pay. In the tribunal's view, the nearest similar domestic action was for breach of a contract in relation to non-payment of wages brought in the county court. In such cases, by virtue of the Limitation Act 1980, payment can go back six years. However, said the tribunal, the comparison involves "not mere questions of time, but also the cost and procedural inconveniences of the different fora in which the various claims can be brought". Balancing these factors, the tribunal was "unanimously of the view that the Equal Pay Act provisions are not less favourable to a prospective applicant".

Backed by the EOC, the applicant appealed and her case was combined with the continued appeal in relation to Mrs Levez (who was also supported by the EOC).

The EAT identified a number of guiding principles in determining whether the principle of equivalence had been breached. There must, for example, be a "true" comparison, ie the juridical basis for the claim must be the same; and in making the comparison, the Court must review the procedure as a whole and weigh the advantages and the disadvantages.

In the EAT's view, there were a number of "true" comparisons with claims for breach of the equality clause under the EqPA. The "claims for monies due under a contract, for unlawful deduction from wages and for unlawful discrimination in terms of employment on grounds of race or disability are all legitimate comparators", said the EAT. Whereas compensation in such claims can go back six years, compensation for breach of the inequality clause is restricted to two years, with "no compensating advantages". Therefore s.2(5), said the EAT, discriminates against claimants under the EqPA.

Section 2(5), said the EAT, "is a restriction on the right to have a full and effective remedy for breach of Article 119 and the Equal Pay Directive. It is a breach of the principle of equivalence. It is therefore, in our judgement, unenforceable , as it is incompatible with the UK's obligations" under the Rome Treaty. Accordingly, the EAT allowed the two appeals and made a declaration that s.2(5) is "no bar to the recovery of monies held to be due for a period of six years from the date of the commencement of proceedings". See p.52 for further details.

Streamlining equal value procedure

Proposals to "simplify and streamline" the equal value procedure were made in Lawson v South Tees District Health Authority by the London South employment tribunal dealing with all the speech therapist test cases. In this, and earlier speech therapist cases, it had "noted problems with the legislation and procedure relating to the assessment of whether work is of equal value or not". In its view "the legislation and procedures are rigid, complex and time-consuming". This, it said, "cannot be of assistance to the parties or to the public in general, particularly where as in these cases, large sums of public money are involved. The tribunal offers possible amendments to the legislation, particularly on procedure, which it believes may simplify and streamline the procedure."

The amendments to the legislation suggested by the tribunal include the following:

EOC(NI) Code of Practice on pay

The speech therapist's claim - the final stages

At the time of writing, the union, MSF, and the NHS Executive were embroiled in lengthy negotiations aimed at bringing the speech therapists' equal value saga to a conclusion by the end of the year.

The legal battle began in 1986 when Pam Enderby, backed by MSF and the EOC, claimed equal pay for work of equal value, comparing her work with that done by a male senior pharmacist and a male senior clinical psychologist.

Speech therapy is traditionally a female occupation whereas clinical psychology and pharmacology are male-dominated professions. There were different bargaining arrangements for each group. Speech therapists' pay was determined by negotiation through Committee B of Professional and Technical Council A of the NHS Whitley Councils. The pay of clinical psychologists was dealt with by Committee A of Council A. Pharmacists' pay was negotiated within a separate Whitley Council. At the time of her application, Professor Enderby's pay was £10,016, while that of her male comparators was £12,527 and £14,106. In the autumn of 1987 around 1,500 speech therapists made similar applications.

Professor Enderby's claim was twice rejected by an employment tribunal before being referred by the Court of Appeal to the European Court of Justice (ECJ) in October 1991, which held in the applicant's favour. Following the ECJ ruling, the Court of Appeal referred the case back to the employment tribunal.

In 1995/96, Professor Enderby's case was referred to an independent expert along with 17 other test cases (originally there were 21 test cases but three were withdrawn). Since then the equal value issue has been determined in all the cases, resulting in tribunal decisions or settlements in favour of the majority of the lead case applicants. These cases have been used as templates for resolving all the remaining cases. So far, the jobs of over 200 of the 1,500 applicants have been agreed to be of equal value.

The main issues in the negotiations between MSF and the NHS Executive concerns the amount of compensation and ensuring that the NHS pay structure is equal-value proof.

It has been a costly fight. Legal defence costs alone, are estimated to be well over £1 million, though this figure is far exceeded by the size of the potential NHS bill for back-pay. The union's legal advisors have estimated that if only a third of the 1,500 original claims are accepted, back-pay liability could amount to £30 million.

Below we highlight the main legal stages in the long and tortuous path taken in the speech therapist cases.

No obligation to refer to an independent expert

Section 2A(1) of the EqPA as amended in 1996 provides that:

"Where on a complaint or reference made to an industrial tribunal under s.2 above, a dispute arises as to whether any work is of equal value as mentioned in s.1(2)(c) above, the tribunal may either -

(a)proceed to determine that question; or

(b)unless it is satisfied that there are no reasonable grounds for determining that the work is of equal value as so mentioned, require a member of the panel of independent experts to prepare a report with respect to that question;

and, if it requires the preparation of a report under paragraph (b) of this sub-section, it shall not determine that question until it has received the report".

Comparisons

Comparisons faced by tribunals that have opted to determine the equal value questions themselves include:

Equal value cases referred to an independent expert

Since the equal value law came into operation in 1984, UK tribunals have appointed independent experts in just under 200 cases involving around 1,900 applicants. Below we list 48 of those cases. The cases highlighted in bold text are those referred to independent experts since our last update. The other cases comprise those which were included in our last update and where, at that stage, there had been no outcome. For other references see previous updates.