27th October 2017

Is Your Business at Risk of an Equal Pay Claim?

 

The Employment Appeal Tribunal's (EAT) most recent decision in the Asda v Brierley case held that a predominately female group of retail employees could compare themselves to a mainly male group of distribution depot employees for the purposes of an equal pay claim.

Background

This appeal arises as a result of an equal pay claim brought by over 7,000 current and former (predominately female) Asda employees working in the retail sector, who alleged that they were paid less for work of equal value than male workers in the distribution depots.

Asda argued that the female retail workers could not compare themselves with the male workers in the distribution depot because different arrangements applied for setting their pay. The retail workers’ pay was set by the Board whilst the distribution workers’ pay was set by way of collective bargaining.

The ET held in the workers' favour and held that the retail workers could compare themselves to the distribution depot workers.

Asda appealed this decision.

Appeal Decision

The EAT upheld the first instance Tribunal’s decision and held that, although the pay was set differently, the responsibility for setting pay could be traced back to a ‘single source’. In this instance, Asda’s Executive Board had the ultimate responsibility for setting pay levels; even though in practice, decisions on pay were delegated to others.

The EAT held that, as the Executive Board had the power to restore equality of treatment for both parts of the workforce, this was enough to allow for a comparison of the workers to be made.

Asda has applied to the Court of Appeal for permission to appeal, so this is unlikely to be the last word on this issue.

Consequences for Employers

As a result of the Judgment, employers are advised to review their current pay structures across their entire workforce and identify any variations in pay between broadly comparable roles.  It is important for employers to identify the risk areas and to begin bridging any gaps in pay to reduce the risk of equal pay claims.

Following the abolition of Employment Tribunal Fees in July 2017, and in light of this Judgment, there is an increased likelihood that there will be a surge in unequal pay claims.

*All information is correct at the time of publishing

Sarah Collier

Sarah is one of our Employment Law Specialists from Napthens Solicitors. Read more

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