Reading Borough Council v James and others UKEAT/0222/17

Where the necessary conditions of Equal Pay Act 1970 or the Equality Act 2010 are satisfied i.e. that a term of the woman's contract is less favourable than a term of the man's, but they are employed on work of equal value and there is no material factor to explain the difference, the equality clause operates automatically to equalise the less favourable term in the woman's contract.

In this case female employees (claimants) successfully argued that they could still seek to compare themselves to male employees for the purposes of equal pay even where those male comparators had been promoted, or left their roles, part way through the period for which the claimants sought equal pay. The claimants were not required to find another comparator for the balance of the period, as they already had a statutorily implied contractual right to higher pay by the time the comparators' roles changed.

The case

One group of claimants had been employed on work of equal value to their comparator (C1) from 2002. A second group of claimants were found to be performing work of equal value to a second comparator (C2), also from 2002. However, C1 had been promoted to a different role in 2006, and C2's role had changed in 2011. The claimants could have used other comparators, but chose not to.

Their employer, Reading Borough Council (Council) argued that the claimants could not compare themselves to C1 and C2 from the date that the comparators' jobs changed. The tribunal disagreed. Relying on earlier decisions it concluded that the equality clause had caused the right to pay at the same level as the comparators to crystallise, and the subsequent change in the comparators' roles did not alter that.

The Council appealed against the decision that the claimants were entitled to equal pay, with arrears dating back to 2002. It challenged the period over which their right to equal pay was effective, arguing that one male comparator had been promoted in April 2006, and that the other comparator's role had been assimilated into a single status scheme at a lower rate of pay. This meant that neither individual was a valid comparator for the whole period of arrears.

The Employment Appeal Tribunal (EAT) dismissed the employer's appeal. It held that once a comparator had been selected, the Council could not argue for a "better" or "more appropriate" comparator. Once the conditions for the operation of the sex equality clause were satisfied in 2002, it took effect and amended the claimants' contracts so as to equalise them with the chosen comparator. No time limitation or other provision in the Equal Pay Act 1970 then restricted the continued implication of the equalised term in any way. The claimants' right to higher pay therefore crystallised in 2002, and would continue until their contracts are validly varied or terminated.

What to take away

The EAT has clarified that a group of female employees' contractual right to equal pay was not affected by the promotion of their comparators. It rejected the argument that where comparators are promoted or their job role changes, the right to higher pay ends.