JUDGMENT
North and others (Appellants) v Dumfries and
Galloway Council (Respondent) (Scotland)
before
Lord Hope, Deputy President
Lady Hale
Lord Wilson
Lord Reed
Lord Hughes
JUDGMENT GIVEN ON
26 June 2013
Heard on 20 and 21 May 2013
Appellant Respondent
Dinah Rose QC Ian Truscott QC
Iain Steele Linda Marsh
(Instructed by Unison (Instructed by Glasgow
Legal Services) City Council Corporate
Services)
Intervener
Robin Allen QC
(Instructed by Equality &
Human Rights
Commission)
LADY HALE (with whom Lord Hope, Lord Wilson, Lord Reed and Lord
Hughes agree)
1. Under the Equal Pay Act 1970, women (or men) whose work is of equal
value to that of men (or women) in the same employment are entitled to the benefit
of a deemed equality clause in their contracts of employment. This means that if
any of their terms and conditions is less favourable than the equivalent term or
condition of the men with whom they are compared, they are entitled to have the
benefit of that more favourable term, as if it had been included in their original
contract of employment. It is therefore necessary to identify the precise terms and
conditions with which comparison is to be made. This entails finding an individual
or group of the opposite sex who constitute a valid comparator. There are several
elements in that task. One involves looking at the kind of work the men and the
women do: is it “like”, or has it been “rated as equivalent”, or is it “of equal
value”? Another involves looking to see whether there are material factors other
than the difference in sex which explain the difference in treatment. But a
threshold question is whether the men and women are “in the same employment”.
The issue in this case is what that means.
2. The answer would be easy if all it meant was that they were employed by
the same employer, the person with whom they all have contracts of employment
and who therefore has it within his power to correct the inequality. Unfortunately,
it is not that simple. There are occasions when women may be able to compare
themselves with men who are not employed by the same employer. However, in
United Kingdom law, there are also occasions when women may not be able to
compare themselves with men, even though they are employed by the same
employer, because they are not employed at the “same establishment”. But if that
provision erects a barrier to a claim which would otherwise be available under
European Union law, it would be our duty to disapply it.
3. Section 1(6) of the Equal Pay Act 1970 provides:
“. . . men shall be treated as in the same employment with a woman
if they are men employed by her employer or any associated
employer at the same establishment or at establishments in Great
Britain which include that one and at which common terms and
conditions of employment are observed either generally or for
employees of the relevant classes. ” (emphasis supplied)
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The Equal Pay Act 1970 has now been repealed and replaced by provisions in the
Equality Act 2010 which are intended to be of equivalent effect, but the 1970 Act
continues to govern claims, such as those in the present case, which were brought
before the 2010 Act came into force.
The case law so far
4. Section 1(6) falls into two separate propositions, one contained in the words
before and the other contained in the words after “or” where it appears for the
second time in the subsection. The first proposition is straightforward: if the
woman and her comparator are employed by the same or an associated employer
in the same establishment, then they are in the same employment and there is no
need to consider the question of common terms of employment: see Lawson v
Britfish Ltd [1987] ICR 726; North Cumbria Acute Hospitals NHS Trust v Potter
[2009] IRLR 176.
5. The difficulty comes with the second proposition, where they are employed
“at establishments in Great Britain which include that one and at which common
terms and conditions of employment are observed either generally or for
employees of the relevant classes.” The interpretation of this proposition has come
before the House of Lords on two previous occasions and we have not been invited
to depart from the conclusions they reached.
6. In Leverton v Clwyd County Council [1989] AC 709, the applicant was a
nursery nurse who wished to compare herself with male clerical workers employed
by the same local authority under terms and conditions derived from the same
collective agreement, known as the “Purple Book”. None of the male workers
worked at the same establishment as she did and their hours of work were longer
and their holidays shorter than those of the applicant. The employment tribunal,
the Employment Appeal Tribunal, and the Court of Appeal (by a majority) held
that they were not “in the same employment” for the purpose of section 1(6). They
took the view that the subsection called for a comparison between the terms and
conditions of the applicant and of her comparators and that only if those were
“broadly similar” to one another was the test satisfied.
7. The House of Lords disagreed. Lord Bridge of Harwich gave the leading
opinion, with which the other members of the appellate committee agreed. He
thought that the language of the subsection was clear and unambiguous:
“The concept of common terms and conditions of employment
observed generally at different establishments necessarily
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contemplates terms and conditions applicable to a wide range of
employees whose individual terms will vary greatly inter se” (p
745F).
Terms and conditions governed by the same collective agreement seemed to him
the paradigm, though not necessarily the only example, of common terms and
conditions contemplated by the subsection.
8. But if there was any ambiguity, he would reject a construction which
required a “broad similarity” between the terms and conditions of the woman and
of her claimed comparators. Such a construction:
“frustrates rather than serves the manifest purpose of the legislation.
That purpose is to enable a woman to eliminate discriminatory
differences between the terms of her contract and those of any male
fellow employee doing like work, work rated as equivalent or work
of equal value, whether he works in the same establishment as her or
in another establishment where terms and conditions of employment
common to both establishments are observed” (pp 745H – 746A).
It could not have been the intention of Parliament to require a woman to prove “an
undefined substratum of similarity” between her terms of employment and his as
the basis of a claim to eliminate any discriminatory difference between them.
9. In his view, the reason why Parliament had not simply required that the
woman and her comparators be employed by the same employer but had also
required that common terms and conditions of employment be observed between
two different establishments was that a single employer might operate “essentially
different employment regimes at different establishments” (p 746C). He gave the
examples of one employer having establishments in London and in Newcastle,
where the regimes were quite different, or of a company operating one factory
taking over a company operating another factory, where there were quite different
collective agreements resulting in quite different structures.
10. Leverton was an easy case, because everyone was employed under the same
“Purple Book” agreement. But once it is clear that Parliament cannot have been
referring to common, or even broadly similar, terms and conditions between the
woman and her comparators, it is equally clear that it cannot be a requirement that
they are covered by the same collective agreement. In British Coal Corporation v
Smith [1996] ICR 515, the applicants were canteen workers, canteen manageresses
and cleaners, employed at 47 different British Coal Corporation establishments.
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Their named comparators were mainly surface mineworkers working at 14
different establishments, some of them the same as the places where the women
worked and some of them not. Their terms and conditions were governed by a
variety of agreements. It was not disputed that the women could take a comparator
from their own colliery or other workplace. The question was whether they could
take comparators from other collieries or workplaces.
11. Lord Slynn of Hadley, with whose opinion all the other members of the
appellate committee agreed, pointed out that it was obvious why a woman was not
limited to comparing herself with men employed in the same workplace as she
was: “. . . otherwise an employer could so arrange things as to ensure that only
women worked at a particular establishment or that no man who could reasonably
be considered as a possible comparator should work there” (p 525H). The
inclusion in section 1(6) of the words “which include that one” (that is, the
establishment at which the woman works) was at first sight puzzling, but read with
the words “and at which common terms . . . are observed” which follow it simply
meant that common terms must be observed, not only at the other place but also at
the woman’s place of work if employees of the relevant class were employed
there. It was agreed that the woman did not have to show that she shared common
terms and conditions with her comparator, either in relation to those terms which
were alleged to constitute the discrimination or in relation to the other terms. What
had to be shown was that the different classes of employee shared common terms.
It was agreed that the women did so. Hence:
“What therefore has to be shown is that the male comparators at
other establishments and at her establishment share common terms
and conditions. If there are no such men at the claimant’s place of
work then it has to be shown that like terms and conditions would
apply if men were employed there in the particular jobs concerned”
(p 526F).
The Corporation claimed that this meant that the terms and conditions of the
comparators had to be the same in substantially all respects. Lord Slynn rejected
this and adopted a test of broad similarity:
“The purpose of requiring common terms and conditions was to
avoid it being said simply ‘a gardener does work of equal value to
mine and my comparator at another establishment is a gardener.’ It
was necessary for the applicant to go further and to show that
gardeners at other establishments and at her establishment were or
would be employed on broadly similar terms. It was necessary but it
was also sufficient” (p 527D).
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12. The principles to be derived from these two cases are therefore plain. First,
the “common terms and conditions” referred to in section 1(6) are not those of, on
the one hand, the women applicants and, on the other hand, their claimed
comparators. They are, on the one hand, the terms and conditions under which the
male comparators are employed at different establishments from the women and,
on the other hand, the terms and conditions under which those male comparators
are or would be employed if they were employed at the same establishment as the
women. Second, by “common terms and conditions” the subsection is not looking
for complete correspondence between what those terms are, or would be, in the
woman’s place of work. It is enough that they are, or would be, broadly similar.
13. It is also plain from the reasoning of both Lord Bridge in Leverton and Lord
Slynn in British Coal Corporation that it is no answer to say that no such male
comparators ever would be employed, on those or any other terms, at the same
establishment as the women. Otherwise, it would be far too easy for an employer
so to arrange things that only men worked in one place and only women in
another. This point is of particular importance, now that women are entitled to
claim equality with men who are doing completely different jobs, provided that the
women are doing jobs of equal value. Those completely different jobs may well be
done in completely different places from the jobs which the women are doing.
14. However, it is fair to say that it is not clear from the facts as we have them
that this was the actual situation in the British Coal Corporation case. Some of the
male surface mine workers were working in the same colliery as some of the
claimants. It could just be, as suggested by Mr Truscott QC on behalf of the
employers in this case, that all the 47 places where the women worked were
collieries at which it was possible that surface mineworkers might also work, even
though those chosen do not in fact do so. The issue, therefore, is whether the
women can compare themselves with men employed by the same employer in
other places of work when in practice those men would never be employed to do
their current jobs in the same place as the women.
The facts
15. These claims are brought by 251 classroom assistants, support for learning
assistants and nursery nurses employed in a local authority’s schools. The
classroom and support for learning assistants are employed in the local authority’s
education service under the terms contained in a national collective agreement, the
Administrative, Professional, Technical and Clerical agreement, known as the
“Blue Book”. The nursery nurses are employed under a supplement to the Blue
Book. They are based at a variety of schools in the local authority’s area. Their
individual contracts specify the particular school at which they are based and also
state that they may be required to work at other locations. They are employed
Page 6
during the school terms only and work less than 35 hours per week. The
convenience of these hours for people with child care or other domestic
responsibilities is no doubt one of the reasons why these posts are predominantly
held by women.
16. The claimants wish to compare themselves with a variety of manual
workers employed by the same local authority, as groundsmen, refuse collectors,
refuse drivers and a leisure attendant. They are employed in the authority’s
combined services, under a different collective agreement, the Scottish Council for
Local Authorities’ Services (Manual Workers) Scheme of Pay and Conditions of
Service, known as the “Green Book”. The leisure attendant is based at a swimming
pool, but the others are based at various depots in the local authority’s area, from
which they go out to do their work in a variety of locations. Although some of
their work is done at schools, they are not based there. Their individual contracts
of employment specify the depot at which they are based and that they may be
required to work at other locations. They work full time with a fixed annual leave
entitlement. They are entitled to substantial bonus payments or supplements on top
of their basic pay, whereas the claimants are not.
17. The authority does employ a small number of manual workers as school
janitors. They are based in schools and, like the claimants, work only during the
school terms. But the claimants do not wish to compare themselves with the
janitors, who are not entitled to the bonuses or supplements which the other
manual workers enjoy.
18. It may be worth noting that the employers and trade unions have negotiated
a single status collective agreement, known as the “Red Book”, which would cover
both the claimants and the comparators. But the existing pay and grading
arrangements were to remain in force until the employers had completed a job
evaluation exercise. This had not been done at the time of the employment
tribunal’s decision in this case, so the essential terms remained governed by the
original Blue and Green Books.
The proceedings
19. Most of the claims were lodged between February and December 2006,
with the last claim lodged in February 2007. As none of the claimants was
employed at the same establishment as their chosen comparators, the local
authority applied for a pre-hearing review to have the employment tribunal
determine whether or not they were “in the same employment” as defined in
section 1(6) of the 1970 Act. The claims were conjoined by order at the outset of
the pre-hearing review in December 2007.
Page 7
20. This is but the first hurdle which the claimants face. If they succeed in
jumping it, they will still have to prove that their work is comparable to that of the
men. In its original form, the 1970 Act only imposed an equality clause where they
were employed in “like work” (now covered by section 1(2)(a)) or “work rated as
equivalent” in a formal job evaluation exercise (now covered by section 1(2)(b)).
Although both are mentioned in the sample claim form which we have seen, these
claims are primarily based on the allegation that the work done by the claimants is
of “equal value” to that done by the comparators. Section 1(2)(c) of the 1970 Act
(added by SI 1983/1794) applies where a “woman is employed on work which, not
being work in relation to which paragraph (a) or (b) above applies, is, in terms of
the demands made on her (for instance under such headings as effort, skill and
decision), of equal value to that of a man in the same employment”. That issue has
yet to be addressed.
21. Furthermore, if the claimants succeed in establishing that their work is of
equal value, the employer could still seek to establish that there was a good reason
for the difference between their terms and conditions. Section 1(3) of the 1970 Act
(as substituted by SI 1983/1794) provides:
“An equality clause . . . shall not operate in relation to a variation
between the woman’s contract and the man’s contract if the
employer proves that the variation is genuinely due to a material
factor which is not the difference of sex and that factor –
(a) in the case of an equality clause falling within
subsection (2)(a) or (b) above, must be a material
difference between the woman’s case and the man’s;
and
(b) in the case of an equality clause falling within
subsection (2)(c) above, may be such a material
difference.”
22. This issue, too, has yet to be addressed. Nevertheless, it is important to
bear in mind that the question of whether there are other explanations for the
difference in treatment is analytically quite distinct from the question whether the
claimants and their comparators are in the same employment within the meaning
of section 1(6). So too is the question of what modifications to the women’s terms
and conditions would be necessary to eliminate the less favourable treatment. At
times during the argument at all levels in this case, it appears that those
distinctions have not been observed.
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23. In May 2008, the employment tribunal determined the “same employment”
issue in the claimants’ favour. The employment judge defined the question in this
way, at para 61:
“In the present case, the claimants and comparators are neither
employed under the same terms and conditions nor in the same
establishment. It is therefore necessary for the claimants to satisfy
the Tribunal that if their comparators were employed at their
establishment, they would be employed under broadly similar terms
to those that they are employed under at present.”
That, as the Court of Session later acknowledged, was exactly the right
question.
24. The judge answered that question in the affirmative. It was not enough for
the respondents to say that the comparators would never be employed at the same
establishment. They did some of their work at schools, there was no suggestion
that this work was of less significance than the work they did elsewhere, and when
they did work at schools there was no change to their terms and conditions of
employment. “There was no persuasive evidence before the Tribunal that in the
event they were based at the same establishment as the claimants, the comparators
would be employed under terms and conditions other than the Green Book” (para
61 bis). The judge did not at that stage specifically refer to the evidence which had
been given for the local authority on which that statement was based (excerpted at
para 27 below), although she had earlier referred to some of it when reciting the
submissions of the parties.
25. The local authority appealed to the Employment Appeal Tribunal, which
handed down judgment allowing the appeal in May 2009: UKEATS/47/08, [2009]
ICR 1363. Lady Smith accepted the respondents’ argument that a woman who
seeks to compare her terms and conditions with those of a man who does not work
at the same establishment as she does must first show that there is a “real
possibility” that he could be employed there to do the same or a broadly similar
job to the one which he does at the other establishment. Such a finding was not
open to the Tribunal on the evidence.
26. The claimants then appealed to the Court of Session. Before their appeal
was heard, the EAT decided the case of City of Edinburgh Council v Wilkinson
[2010] IRLR 756. The women claimants were employed by the council on Blue
Book terms in a variety of posts in schools, hostels, libraries or social work. They
wished to compare themselves with manual workers, including road workers,
refuse collectors, gardeners and grave diggers, employed on Green Book terms.
Page 9
Lady Smith (having revisited the House of Lords authorities discussed above)
accepted that the intention of section 1(6) “could be undermined if claimants were
required to establish, as fact, that there was a real possibility of their comparators
being employed at the same establishments as them”. It was enough to show that
“it is likely that those comparators would, wherever they worked, always be
employed on the same terms and conditions”. If they were always employed on the
same terms and conditions, it was “legitimate to assume that they would be
employed on those terms and conditions at the claimants’ establishment and men
and women would thus be shown to be in the same employment” (para 77). The
paradigm example of the required hypothetical exercise would be where the
comparators were always employed under the same collective agreement, as in that
case.
27. When the present case came before the Court of Session, in January 2011,
that court agreed with Lady Smith’s rejection of the “real possibility” test in
Wilkinson: [2011] CSIH 2, 2011 SLT 203. Nevertheless, Lady Paton (delivering
the opinion of the court) held that the evidence did not support the employment
tribunal’s factual conclusion. She quoted several paragraphs from the evidence of
Mr Archibald, for the local authority, at para 35 of her judgment, which included
the following:
“If a manual worker comparator were for any reason to transfer to do
their job solely and only in a school context, which would seem an
impossible suggestion, then I cannot envisage other than that they
would retain core Green Book conditions, but because of the nature
of the work undertaken across all educational establishments, their
terms and conditions would require to be very significantly varied to
make working in such locations possible” (para 32).
In her view, that passage was concerned with a worker who was transferred to do
most of his work at a school but remained based at his depot. Later passages in Mr
Archibald’s evidence hypothesised a manual worker based at a school:
“Conceivably some new, hybrid, ‘handyperson’ type job
incorporating all the tasks of the comparators could be created – but
as to what the terms of such a job would be would be difficult to
assess – if it was to remain on Manual Worker terms, because of the
job content then the Green Book terms any such postholder would be
on (whether doing a hybrid job or his/her current job) would not be
similar to those s/he currently enjoys because so many of the
provisions of the Green Book which s/he now enjoys would no
longer be apt. I cannot imagine even in the hypothetical context the
job or jobs being able to remain similar to what they would be now –
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they simply would not fit into any JES manual worker profile – and
that would have an effect on their terms and conditions” (para 36).
Hence the claimants had not established that, if the comparators were based at the
same establishment as the claimants, the comparators would still have been
employed on Green Book terms and conditions. The appeal was therefore refused,
not because the employment tribunal had applied the wrong legal test, but because
the evidence did not support the conclusion on the facts.
28. To complete the chronology, the Wilkinson case then came before the Court
of Session: [2011] CSIH 70, 2012 SC 423. The Court upheld the decision of the
EAT. Lord Eassie held, at para 35, that:
“What has to be considered is whether if a manual worker, in casu a
gardener, refuse collector, or grave digger, whether hypothetically
likely or not, were to be located in the claimant’s establishment for
the performance of his current job he would continue to be employed
on terms and conditions applicable to manual workers”.
Lady Paton distinguished the case from the present one, because the tribunal had
analysed the evidence relating to the terms and conditions of work for the
hypothetical transposed worker, and found it not inconceivable that he could be
assigned to work at one of the claimants’ establishments and that, if so, he would
still be employed on Green Book terms. But both she, at para 49, and Lord Hardie,
at para 54, disagreed with Lord Eassie’s further observation, in para 35, that it was:
“erroneous (perhaps particularly in an equal value claim) to consider
whether, on the transfer of the male comparator hypothetically to the
woman’s establishment, adjustment might be made to his terms and
conditions to dovetail more closely with those of the female
claimant”.
29. Thus, it would appear that, while the Court of Session has rejected the “real
possibility” test, it remains unclear to what extent the Tribunal is obliged to
hypothesise about possible adjustments to the terms and conditions which would
apply in the unlikely event of the comparator being transferred to work at the same
establishment as the claimant.
Discussion
Page 11
30. Not surprisingly, Ms Dinah Rose QC, on behalf of the appellant claimants,
argues that the tribunal should not speculate about the adjustments to the
comparators’ present terms and conditions which might be made in the unlikely
event that they were transferred to the claimants’ workplace. The hypothesis is that
the comparators are transferred to do their present jobs in a different location. The
question is whether in that event, however unlikely, they would remain employed
on the same or broadly similar terms and conditions to those applicable in their
current place of work. As Lord Slynn had recognised in the British Coal
Corporation case, the object of the legislation was to allow comparisons to be
made between workers who did not and never would work in the same work-place.
An example might be a manufacturing company, where the (female) clerical
workers worked in an office block, whereas the (male) manufacturers worked in a
factory.
31. She also argues that, the employment tribunal having adopted the correct
test, the Court of Session should not have interfered with its findings in fact. The
tribunal had founded its conclusion on the first of the two passages of Mr
Archibald’s evidence quoted in paragraph 27 above. This was contemplating that
the manual workers would become based in the claimants’ schools in order to do
their present jobs, although he could not envisage that ever happening. In the
second passage, he was hypothesising the creation of a completely new all-purpose
handyman who might plausibly be based in schools. That was an unnecessary and
illegitimate hypothesis and the tribunal was clearly entitled to conclude that there
was no compelling evidence that the comparators would not be employed on the
same or broadly similar terms and conditions in the unlikely event that they
became based in schools.
32. Mr Truscott, for the local authority, agrees that there is no need to show a
“real possibility” that the comparators could be transferred to do their current jobs
in the claimants’ workplace. But, he argues, how does the British Coal
Corporation test work in a factual situation such as this, which goes well beyond
what was envisaged in that case? That case was premised on the fact that the
comparators could be based at the same place as the claimants, even though some
of them were not. So, while he agrees that there is no need to show a real
possibility that the workers could be co-located, he argues that it should at least be
feasible that they might be. The evidence of Mr Archibald was clear that it was
not.
33. I have no hesitation in preferring the arguments presented by Ms Rose. In
the first place, it is by no means clear from the facts reported in the British Coal
Corporation case that all the women claimants were based in collieries where there
might also be surface mine-workers employed. In the second place, there is no hint
of a “real possibility” or “feasibility” test in that case and I find it difficult to
discern a genuine difference in principle between them. Both add an unwarranted
Page 12
gloss to the wording of the subsection as interpreted in the British Coal
Corporation case.
34. In the third place, to adopt such a test would be to defeat the object of the
exercise. This is not just a matter of preventing employers from so organising their
workplaces that the women work in one place and the men in another. There may
be perfectly good reasons for organising the work into different places. But the
object of the legislation is to secure equality of treatment, not only for the same
work, but also for work rated as equivalent or assessed by the experts to be of
equal value. It stands to reason, therefore, that some very different jobs which are
not or cannot be carried out in the same workplaces may nevertheless be rated as
equivalent or assessed as having equal value. One example is the (female) office
worker who needs office equipment in a clean environment and the (male) factory
worker who needs machines which create dirt and dust. But another is the (female)
factory worker who puts microscopic circuits on silicon chips in one factory and
the (male) factory worker who assembles computer parts in another. The fact that
of necessity their work has to be carried on in different places is no barrier to
equalising the terms on which it is done. It is well known that those jobs which
require physical strength have traditionally been better rewarded than those jobs
which require dexterity. It is one of the objects of the equality legislation to iron
out those traditional inequalities of reward where the work involved is of
genuinely equal value.
35. In the fourth place, it is not the function of the “same employment” test to
establish comparability between the jobs done. That comparability is established
by the “like work”, “work rated as equivalent” and “work of equal value” tests.
Furthermore, the effect of the deemed equality clause is to modify the relevant
term of the woman’s contract so as not to be less favourable than a term of a
similar kind in the contract under which the man is employed or to include a
beneficial term in her contract if she has none (section 1(2)(a), (b) or (c) as the
case may be). That modification is clearly capable of taking account of differences
in the working hours or holiday entitlement in calculating what would be equally
favourable treatment for them both. Moreover, the equality clause does not operate
if a difference in treatment is genuinely due to a material factor other than sex
(section 1(3)). The “same employment” test should not be used as a proxy for
those tests or as a way of avoiding the often difficult and complex issues which
they raise (tempting though this may be for large employers faced with multiple
claims such as these). Its function is to establish the terms and conditions with
which the comparison is to be made. The object is simply to weed out those cases
in which geography plays a significant part in determining what those terms and
conditions are.
36. In the fifth place, the construction of section 1(6) favoured by the appellants
is more consistent with the requirements of European Union law than is the
Page 13
construction favoured by the respondents. The 1970 Act was the United
Kingdom’s way of giving effect in United Kingdom law to the principle of equal
treatment of men and women, first enshrined in article 119 EEC, then translated
into article 141 EC, and now translated into article 157 of the Treaty on the
Functioning of the European Union. The Court of Justice held as long ago as 1976,
in the case of Defrenne v Sabena (Case 43/75) [1976] ICR 547, 566, para 12 that
the principle of equal pay for men and women “forms part of the foundations of
the community” and has direct effect in the member states in relation to direct
discrimination which may be identified solely with the aid of the criteria based on
equal work and equal pay. As Advocate-General Geelhoed explained in Lawrence
v Regent Office Care Ltd (Case C-320/00) [2003] ICR 1092:
“It is not evident from the wording of Article 141 EC that the
comparison must be confined to one and the same employer. Its case
law demonstrates that the Court has consistently stood by its
requirement that for a finding of direct discrimination there must be
a clear difference in pay vis-à-vis male co-workers working in the
‘same establishment or service’ (see, inter alia, Defrenne v Sabena
(Case 43/75) [1976] ICR 547, 567, para 22) or that the difference in
pay must have its origin in legislative provisions or provisions of
collective labour agreements (Defrenne, para 21).” (para 46)
37. There were three categories of case where it was possible to go outside the
individual undertaking or service in order to make the comparison: first, where
statutory rules applied to the working and pay conditions in more than one
undertaking, establishment or service, such as the pay of nurses in the National
Health Service; second, where several undertakings or establishments were
covered by the same collective works agreement or regulations; and third where
terms and conditions were laid down centrally for more than one organisation or
business within a holding company or conglomerate (paras 50, 49). This was
because:
“The feature common to the three categories is that regulation of the
terms and conditions of employment actually applied is traceable to
one source, whether it be the legislature, the parties to a collective
works agreement, or the management of a corporate group” (para
51).
38. This was an essential criterion because article 141 was “addressed to those
who may be held responsible for the unauthorised differences in terms and
conditions of employment” (para 52). Hence:
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“It is clear from the foregoing that the direct effect of article 141 EC
extends to employees working for the same legal person or group of
legal persons, or for public authorities operating under joint control,
as well as cases in which for purposes of job classification and
remuneration, a binding collective agreement or statutory regulation
applies. In all these cases the terms and conditions of employment
can be traced back to a common source” (para 54).
39. In Lawrence itself, the Court of Justice agreed that the principle was not
limited to situations in which men and women worked for the same employer
(Judgment, para 17). But in the case in question, the differences “cannot be
attributed to a single source, there is no body which is responsible for the
inequality and which could restore equal treatment” (Judgment, para 18). This was
because the claimants, women cleaners and catering workers who had previously
been employed by North Yorkshire County Council and whose work had then
been rated as equivalent to that of men doing jobs such as gardening, refuse
collection and sewage treatment, were now working for the private company to
whom the cleaning and catering service had been contracted out. They could no
longer, therefore, compare their pay and conditions with the men who now worked
for a different employer. (It is worth noting that no question had been referred to
the court about the effect of the regulations governing the transfer of
undertakings.)
40. The position is thus that, for the principle of equal pay to have direct effect,
the difference in treatment must be attributable to a single source which is capable
of putting it right. As it happens, the researches of counsel have discovered no case
in the Court of Justice in which the principle of equal pay has not been applied
between men and women who work for the same employer. However, in
Department for Environment, Food and Rural Affairs v Robertson [2005] EWCA
Civ 138, [2005] ICR 750, the Court of Appeal held that the terms and conditions
of civil servants working in different Government departments were not
attributable to a “single source” for the purpose of article 141 EC. Although they
were all the servants of the Crown, responsibility for negotiating and agreeing their
pay and conditions had been devolved by delegated legislation to the individual
departments concerned. It was common ground that the claimants and their wouldbe comparators in the Department for Transport, Environment and the Regions
were not in “the same employment” within the meaning of section 1(6) of the 1970
Act, because they did not work at the same establishment and common terms and
conditions had not been observed in the two departments since the delegation.
41. Mr Robin Allen QC, for the Equality and Human Rights Commission, tells
us that it is the view of the Commission that Robertson was wrongly decided,
because it did lie within the power of the Crown to put matters right. It is not
necessary for us to determine that question now. In this case it is quite clear that
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the difference in treatment between the claimants and their comparators is
attributable to a single source, namely the local authority which employs them and
which is in a position to put right the discrepancy if required to do so. If section
1(6) were to operate as a barrier to a comparison which was required by EU law in
order to give effect to the fundamental principle of equal treatment, it would be our
duty to disapply it. However, for the reasons given earlier, it sets a low threshold
which does not operate as a barrier to the comparison proposed in this case.
42. I would therefore allow this appeal and restore the decision of the
employment tribunal. The employment judge asked herself the right question and
was entitled on the evidence to answer it in the way that she did.
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