In 1997 a national collective agreement, the Green Book, was agreed between public sector unions and local authorities. This set out a single pay structure applicable to all local authority employees. The GMB Union (“the Union”) was faced with three targets, namely helping its female members with retrospective equal pay claims, pay protection for members whose salaries would be reduced following the new pay structures, and ensuring equal pay for all its members in the future. As local authorities have limited funds these targets would potentially come into conflict, since they put competing claims on finite resources. The Union decided to concentrate on the latter two.
The Union advised its female members with outstanding equal pay claims against Middlesbrough Metropolitan Council to accept settlements which were only 25% of the potential value of their claims. Some of these female members then brought a claim against the Union on the grounds that they had been discriminated against contrary to the Sex Discrimination Act 1975 in giving them this advice to their detriment.
The tribunal found that the Union’s policy advising female members with outstanding equal pay claims to accept low settlements was indirect discrimination. The Union claimed that the policy was so money could be freed up to fight for future pay equality. The tribunal found that this reason was not justification for such discrimination.
On appeal the EAT disagreed with the tribunal and found that although there had been indirect discrimination, the Union could justify it. However the Court of Appeal rejected the EAT’s findings and decided that the Union’s actions had not been a proportionate means of achieving a legitimate aim. The Court of Appeal thought that although the Union’s aim of freeing up money to fight for future pay equality was one of a number of legitimate aims, the means (ie advising the claimants to take a very low settlement offer) was disproportionate. Therefore the Court of Appeal restored the tribunal’s decision.
Allen and ors v GMB, Court of Appeal