COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE SEDLEY
LORD JUSTICE CARNWATH
| MRS V GRUNDY
|- and -
|BRITISH AIRWAYS PLC
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A Merrill Communications Company
190 Fleet Street, London EC4A 2AG
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Mr C Jeans QC and Mr A Short (instructed by British Airways Legal Department) for the Respondent
Hearing date: Monday 26 February 2007
Crown Copyright ©
Lord Justice Sedley :
1(1) If the terms of a contract under which a woman is employed at an establishment in Great Britain do not include …an equality clause they shall be deemed to include one.
(2)An equality clause is a provision which relates to terms (whether concerned with pay or not) of a contract under which a woman is employed (the "woman's contract"), and has the effect that
(a) where the woman is employed on like work with a man in the same employment –
(i) if (apart from the equality clause) any term of the woman's contract is or becomes less favourable to the woman than a term of a similar kind in the contract under which that man is employed, that term of the woman's contract shall be treated as so modified as not to be less favourable, and
(ii) if (apart from the equality clause) at any time the woman's contract does not include a term corresponding to a term benefiting that man included in the contract under which he is employed, the woman's contract shall be treated as including such a term
(3) 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) …… must be a material difference between the woman's case and the man's;
"…. [T]he Equal Pay Act 1970 has to be construed so far as possible to work harmoniously both with the Sex Discrimination Act 1975 and article 119. All three sources of law are part of a code dealing with unlawful sex discrimination … It follows that the words "not the difference of sex" where they appear in s.1(3) of the Equal Pay Act 1970 must be construed so as to accord with the Sex Discrimination Act 1975 and article 119 of the Treaty, i.e. an employer will not be able to demonstrate that a factor is "not the difference of sex" if the factor relied upon is sexually discriminatory whether directly or indirectly. Further, a sexually discriminatory practice will not be fatal to a subsection (3) defence if the employer can "justify" it …"
"must prove the absence of sex discrimination, direct or indirect. If there is any evidence of sex discrimination, such as evidence that the difference in pay has a disparately adverse impact on women, the employer will be called upon to satisfy the tribunal that the difference in pay is objectively justifiable. But if the employer proves the absence of sex discrimination he is not obliged to justify the pay disparity."
"Whether a pay disparity has a disparately adverse impact on women is primarily a question of fact."
|Total Pool||6,744 (1994)
% of pool
|Advantaged as %
"23. ….[W]e consider it relevant to look at both the advantaged (full-time, part-time and job share cabin crew) and disadvantaged groups (support cabin crew) in order to establish whether there has been discrimination[,] but that our focus must be on the disadvantaged group.
24. The inability to receive an increment is a detriment as it results in the employee of more than five years standing receiving a lower rate of pay than she otherwise would. Having regard to Allonby v Rossendale College  ICR 1189 we consider the pool for comparison to be all the cabin crew, whether full-time, part-time, job share or support."
There is no complaint about §24. The issue is the last proposition in §23: "our focus must be on the disadvantaged group".
"27. The proportion of women in the disadvantaged group is considerably higher than the proportion in the advantaged group. In the context of the respondent's cabin crew workforce which is comprised predominantly of women we consider that this reveals, and we find[,] that the policy[,] criterion or practice of not paying increments to support cabin crew was to the detriment of a considerably larger proportion of women than of men."
"26. We considered the proportion of women to men within the overall workforce of the cabin crew. In 2002 the total female cabin crew (including support cabin crew) was 8,994 and the total male cabin crew (including support cabin crew) was 4,133, a proportion of 2.18:1. Women in both groups [viz advantaged and disadvantaged] comprised a considerably larger proportion than men. In respect of the disadvantaged group, the women comprise 42 out of 13,127, the men comprise 3 out of 13,127, the proportion of women disadvantaged to the proportion of men disadvantaged amount to 14:1. In the disadvantaged group 86.67% more women than men are disadvantaged…"
"59. ….. As can be seen, the Tribunal directed itself by reference to Rutherford (No.1) and of course did not have the judgment of the Court of Appeal in Rutherford (No. 2). It is now plain from our discussion of the legal principles that it is an error of law to have reversed the focus, as here, from the advantaged to the disadvantaged group."
"Although the impact of course on the individual claimants in the disadvantaged group is serious, the infection is contained."
This passing remark highlights the real difference between the Equal Pay Act criteria and the wider approach now taken. The Equal Pay Act, at least on the face of it, is concerned with the individual treatment of such "infections" (and to a limited extent with their aetiology), but not with their epidemiology.
"…[T]he correct approach is to focus on the advantaged group and not the disadvantaged group. It is not incorrect to look at other proportions and other numbers before finally focusing on the advantaged group."
"The applicants were male employees dismissed by their respective employers when they were over 65. On their claims for compensation for unfair dismissal and redundancy pay, to which, the employers being insolvent, the Secretary of State was respondent, the employment tribunal disapplied sections 109(1)(b) and 156(1)(b) of the Employment Rights Act 1996 in so far as they precluded claims by employees aged over 65 on the ground that the upper age limit provisions had a disparate impact on men that could not be objectively justified and were, accordingly, contrary to the principle of equality of pay between the sexes in article 141 EC. The Employment Appeal Tribunal allowed an appeal by the Secretary of State, holding that, in considering disparate impact, the employment tribunal had selected the wrong pool and should have taken the entire workforce to which the age limit provisions applied, and that on consideration of that pool those provisions did not have a disparate impact on men. The Court of Appeal dismissed appeals by the applicants.
On appeal by the applicants –
Held, dismissing the appeals, (per Lord Scott of Foscote, Lord Rodger of Earlsferry and Baroness Hale of Richmond) that article 141 EC sought to ensure that men and women in the same position in the workforce, doing equal work, received equal pay, and the appropriate group for comparison, in relation to the statutory provisions denying the right to compensation for unfair dismissal and redundancy pay to those over 65, comprised all those still in the workforce at age 65; that, as those provisions applied to the same proportion of women in that group as men, there was no indirect sex discrimination; (per Lord Walker of Gestingthorpe) that the pool for the purposes of comparison comprised all those employed persons on whom rights were conferred by the 1996 Act, and, making a comparison between the proportions of men and women in that group advantaged by the cut-off age, which was the appropriate approach, there was no significant disparity; (per Lord Nicholls of Birkenhead) that in the make-up of the group comprising those not adversely affected by the cut-off age there was virtually nothing to choose between men and women, and, although a higher proportion of men than of women continued in employment after age 65, the ratio of about 1:1.4 in a group comprising only about 1.2% of the workforce was not sufficient to establish the degree of disparity necessary to establish that the legislation had an adverse impact on a substantially higher proportion of men than of women…"
"The fundamental question for the tribunal is whether there is a causative link between the applicant's sex and the fact that she is paid less than the true value of her job as reflected in the pay of her named comparator. The link may be established in a variety of different ways, depending on the facts of the case. It may arise, for example, as a result of job segregation or from pay structures or pay practices which disadvantage women because they are likely to have shorter service or to work less hours than men, due to historical discrimination or disadvantage, or because of the traditional social role of women and their family responsibilities."
Carrying this broad methodology into the assessment of adverse impact, the tribunal will be concerned to make a comparison which illuminates such of these questions as seem to them potentially critical (here, for instance, the need for female cabin crew with childcare responsibilities to have shorter and more flexible working hours), and to find a pool which best helps them to do this. A pool so narrow that no comparison can be made at all is unlikely to serve this end; nor a pool so large that the comparison is no longer of like with like; though in rare cases the nature of the claim may drive the tribunal to one of these extremes and make the claim self-defeating.
Lord Justice Carnwath:
i) Was there a difference of pay between Mrs Grundy and Mr Wynne?
ii) Was the difference substantial or considerable?
iii) Was it justifiable?
At this stage we are not concerned with (iii).
"… indirect discrimination shall exist where an apparently neutral... practice disadvantages a substantially higher proportion of members of one sex…"
The words "substantially" and "considerably" appear to be used without distinction in the European and domestic cases. Whether the test is satisfied is a question of fact for the Employment Tribunal.
"The primary focus is on the proportions of men and women who can comply with the requirement of the disputed rule. Only if the statistical comparison establishes a considerable disparity of impact, must the court then consider whether the disparity is objectively justifiable." (para 25)
He had commented on the risk of "seriously misleading results" which might be caused by concentration on the disadvantaged group, taking the hypothetical example of a requirement with which 99.5% of men can comply and 99% of women can comply:
"If the focus is then shifted to the proportions of men and women who cannot comply (ie 1% of women and 0.5% of men), the result would be that twice as many women as men cannot comply with the requirement. That would not be a sound or sensible basis for holding that the disputed requirement, with which the vast majority of both men and women can comply, had a disparate adverse impact on women." (para 28)
"The least said by the rest of us who take the same view, therefore, the better. There should be no doubt, and no room for argument, about what has been decided and why. Any perceived inconsistency between what I say and what he says is to be resolved in favour of the latter. Indeed, there would be much to be said for our adopting the practice of other supreme courts in having a single majority opinion to which all have contributed and all can subscribe without further qualification or explanation. There would be less grist to the advocates' and academics' mills, but future litigants might thank us for that." (para 304)
Lord Justice Waller: