Employers could face equal pay claims from staff even if they are employed on different terms and conditions, and at different establishments from male comparators, following a landmark ruling from the Supreme Court.
In the case of North and others v Dumfries and Galloway Council, the court ruled that the council discriminated against female employees by not awarding them the same bonuses offered to male colleagues.
This follows an appeal by trade union Unison after the Court of Session said the 251 classroom assistants, support for learning assistants and nursery nurses were unable to compare themselves with groundsmen, refuse collectors and leisure assistants who received bonuses but were based at depots, not at the womens’ schools.
The Supreme Court’s ruling overturns this decision, stating that equal pay law which allows a woman to compare herself with a man “in the same employment” does apply, even though the women worked at different ‘establishments’.
The decision also opens the way for thousands of workers in arms-length companies to compare pay rates between different employers if the council has the overriding ability to control how these subsidiaries operate.
The ruling also means that 2,000 female Unison members are expected to share in an estimated £12 million in payouts following the case.
Caroline Carter, head of law firm Ashurst’s employment, incentives and pensions team, explained that the court’s ruling is a significant decision, which will be met with concern from employers both in the public and private sectors.
She said: “Equal pay claims [in the public sector] have been rife and in the private sector equal pay claims are costly and sensitive to deal with.
“The ruling opens up the numbers of potential comparators an employee can point to when bringing an equal pay claim, which is likely to give rise to many new claims.
“Taken together with the Supreme Court’s landmark equal pay ruling last year (Birmingham City Council v Abdulla) deciding that out-of-time equal pay claims can proceed as breach of contract claims in the High Court, the potential for new claims on the basis of this ruling (even where they are out of time in the Employment Tribunal) is a real possibility.”
Dave Prentis, Unison general secretary, added: “Employers should be in no doubt that this union will continue to pursue cases until all women are treated equally.
“There are far too many who are still discriminated against and far too many employers which are using every single legal argument and loophole to dodge their obligations under equal pay law.”