An ongoing equal pay claim raised by employees of supermarket chain Asda made headlines recently when the Supreme Court upheld the Court of Appeal's decision that the jobs of Asda retail workers (who are mainly female) can be compared to those of Asda's distribution workers (who are mainly male) so that the retail workers could proceed with an equal pay claim. The case examined terms of the Equality Act 2010 and whether these permitted a comparison to be made even though the two groups worked at different establishments.
The ruling is important and may have ramifications for many employers regarding their own pay structures.
Equal pay cases can be complicated, lengthy and expensive. This one will have multiple stages; with this first step complete, the next step is for a tribunal to decide whether the relevant Asda jobs are both of equal value to the other in terms of the level of skill, knowledge and effort required in performing them. Then, if it is decided that the jobs are of equal value, the tribunal will examine if there is any good reason not related to sex that explains the difference in pay between the store workers and the distribution centre workers. Finally, if there is no good reason, a tribunal can make an award of back-pay for a large group of the retail workers going back up to six years - which, needless to add, could be very costly indeed.
This ruling means that there is now potential for more employees to bring similar ‘equal value’ claims, not just at Asda, but at other supermarket chains - as well as in other sectors which have similar staffing models.
It is well-understood that the law requires men and women to be paid equally for doing the same jobs. The concept of 'equal value' work is less well understood, however. The Asda ruling highlights the need for employers to consider the idea of equal value work with regard to their pay structures across their businesses, whatever industry or sector they happen to be in. This is particularly important if employers have groups of mainly male or mainly female workers doing certain jobs, with different rates of pay.
To protect their businesses against a potential ‘equal value’ claim, employers can carry out job evaluations and, using the results, review their pay structures. These assessments can help identify if there are discrepancies within an organisation between the pay levels of women and men doing equal value work. This allow employers to be proactive in addressing the discrepancies before a claim is made. In addition, such assessments can help employers to evaluate how well current job descriptions, job requirements and job duties match the needs of the business, guiding employers on how to improve and realign jobs to increase productivity.
Please get in touch with your usual 3CS contact if you would like further information on any of the above, or on how this issue may affect your business.