ThePeopleAlchemist Edit: HR, Business and equal pay
The Office for National Statistics (“ONS”) reported on 26 October 2016 that the gender pay gap between men and women (for full-time workers) has fallen from 9.6% in April 2015 to 9.4% in April 2016 which is, of course, positive news.
This, however, might not be public perception or opinion following a recent high profile case in the news involving a major retailer.
For those who have missed it, a mass equal pay claim by employees at ASDA will proceed to the tribunal following a recent decision where it was ruled as a preliminary issue that a group of Asda shop workers can compare themselves to depot workers for the purpose of pursuing an equal pay claim.
The claim in question is being pursued by more than 7000 former and current ASDA staff, mainly women, who claim their work stacking shelves and on the checkouts is equal to that in the supermarket’s distribution centres, where the workforce is largely male and are claiming historical discrimination.
To be able to bring the claim under the Equality Act 2010 it was necessary for the female workers (the claimants) to show that the depot workers (the comparators) were employed by the same employer and were either employed at the same establishment or a different establishment but with ‘common terms’.
A spokesperson for the retailer had previously said that “at ASDA people doing the same job are paid the same. Men and women doing the same job in our retail stores are paid the same. Men and women doing the same job in distribution centres are paid the same. Pay rate in stores and depots differ for legitimate reasons, such as different market rates for different jobs”.
In practical terms, Asda resisted the claim asserting that, due to its corporate structure and the retail and distribution operations being separate, the pay-setting powers had been delegated to separate bodies.
The employment tribunal accepted that the claimants’ could compare themselves with the depot workers. Under EU law, the difference in pay could be attributed to a ‘single source’, in this case, Asda’s Executive Board who exercised budgetary control over both the retail and distribution operations and therefore had the power to introduce pay equality.
The tribunal also said that the claimants’ terms were broadly similar to those of the depot employees and met the requirement under the Equality Act 2010 for ‘common terms’.
This case is the UK’s largest-ever private sector equal pay claim, involving women who felt they were paid less despite doing the same amount of work and the decision could amount to an estimated value of over £100m (for Asda).
This is not the end of the case by all means and there are other matters to be determined ( is it equal work of equal value between the two sets of compared workers?) however it could end up having far-reaching consequences for all the other retailers who have very same/similar organisational structures and pay divisions.
Asda continues to strongly dispute the claim against them.
What lessons can employers learn from this case?
- different job titles do not necessarily mean that a disparity in pay between two groups of employees is justifiable
- particular attention is needed where a group of employees is predominantly made up of a different gender to another group with the same/similar but different job roles
- where there are pay discrepancies, the reasons for such differences need to be objectively justified and carefully documented.
Moreover, the Equality Act 2010 (Gender Pay Gap) Regulations 2017 which are due to come into force 6 April 2017 will impose obligations to companies of 250 or more employees to publish certain information in relation to the way they pay their employees and their gender pay gap.
To avoid any very likely negative publicity, and/or costly claims, companies should review and have proactive plans to address any pay gap issues before information needs to be taken in April 2017.
Are you ready?
#Beaware #Beready seek advice.