England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM
THE EMPLOYMENT APPEAL TRIBUNAL

		Royal Courts of Justice Strand, London, WC2A 2LL
		20/10/2009

Lady Justice Arden:

1. This appeal requires us to determine two fundamental questions affecting equal pay claims arising out of the use of a service-related criterion as a determinant of pay: does the employer have to provide objective justification for the way he uses such a criterion, and, if so, in what circumstances? Service-related pay scales, that is, pay scales where increases in pay are dependent on years of service (or a "length of service criterion") are common. It is well established that as a general rule an employer does not have to provide special justification for the decision to adopt such a criterion because the law recognizes that experience enables an employee to work better, and thus that rewarding experience is a legitimate aim of pay policy. The issues on this appeal are of great practical importance to employers and to women in employment. This is particularly so where service-related pay scales were set some years ago, and for reasons which are not now very clear.
2. Service-related pay scales often have different effects on men and women. According to the Equality and Human Rights Commission ("the Commission"), which has been permitted to intervene in this appeal, service-related pay scales:

"will frequently, and perhaps ordinarily have an adverse impact on women who are less likely than men to have unbroken employment records, because of the disproportionate responsibility for family caring."

3. The equal pay legislation does not specifically refer to service-related pay schemes. The jurisprudence surrounding equal pay issues arising out of service-related schemes is at an early stage of development.
4. Equal pay legislation is ultimately derived from article 141 of the European Union Treaty ("the Treaty"). It is a fundamental principle of the Treaty that there should be equal pay for equal work, or work of equal value, for men and women. There have been a number of European directives, which, so far as relevant, have principally been implemented by the Equal Pay Act 1970 ("the 1970 Act"), as amended from time to time. In Cadman v Health & Safety Executive [2006] ICR 1623, the Court of Justice of the European Communities ("the Court of Justice") described the general scheme of Community law on equal pay in the following terms:

"The general scheme arising from Article 141(1) EC

27 Article 141(1) EC lays down the principle that equal work or work of equal value must be remunerated in the same way, whether it is performed by a man or a woman: Lawrence v Regent Office Care Ltd (case C-320/00) [2003] ICR 1092, para. 11).

28 As the Court held in Defrenne v Sabena (Case 43/75) [1976] ICR 547, para. 12, that principle, which is a particular expression of the general principle of equality which prohibits comparable situations from being treated differently unless the difference is objectively justified, forms part of the foundations of the Community (see also case Brunnhofer v Bank der österreichischen Postsparkasse AG (Case C-381/99) [2001] ECR I-4961, para. 28, and Lawrence, para 12).

29 Furthermore, it must be recalled that the general rule laid down in the first paragraph of Article 1 of Directive 75/117, which is principally designed to facilitate the practical application of the principle of equal pay outlined in Article 141(1) EC, in no way alters the content or scope of that principle (see Jenkins v Kingsgate (Clothing Productions) Ltd (Case 96/80592, para. 22). That rule provides for the elimination of all discrimination on grounds of sex with regard to all aspects and conditions of remuneration for the same work or for work to which equal value is attributed: Rummler v Dato-Druck GmbH (Case 237/85) 2101, para. 11).

30 The scope of Article 141(1) EC covers not only direct but also indirect discrimination (see, to that effect, Jenkins, paras 14 and 15, and Elsner-Lakeberg v Land Nordrhein-Westfalen (Case C-285/02) [2004] ECR I-5861, para. 12).

31 It is apparent from settled case law that Article 141 EC, like its predecessor Article 119 of the EEC Treaty (which became Article 119 of the EC Treaty – Articles 117 to 120 of the EC Treaty have been replaced by Articles 136 EC to 143 EC), must be interpreted as meaning that whenever there is evidence of discrimination, it is for the employer to prove that the practice at issue is justified by objective factors unrelated to any discrimination based on sex: see, to that effect, inter alia, Handels – og Kontorfunktionoerernes Forbund I Danmark v Dansk Arbejdsgiverforening, acting on behalf of Danfoss (Case 109/88) [1991] ICR 74, paras 22 and 23; Kowalska v Freie und Hansesradt Hamburg (Case C-33/89) [1992] ICR 29, para. 16, Hill v Revenue Comrs (Case C-243/95) [1999] ICR 48, para. 43, and Schönheit v Stadt Frankfurt am Main (Cases C-4 and 5/02) [2003] ECR I-12575, para. 71.

32 The justification given must be based on a legitimate objective. The means chosen to achieve that objective must be appropriate and necessary for that purpose: see, to that effect Bilka-Kaufhaus Gmb H v Weber von Hartz, (Case 170/84) 110, para. 37."

5. The original reason why the Community adopted the principle of equal treatment in relation to pay was so that those countries which observed a principle of equal pay would not be at a competitive disadvantage as compared with those countries which did not adopt the same principle. Community law now also reflects the fact that equal pay is seen as a social objective in order to ensure equality for all citizens.
6. The course I propose to adopt in this judgment is to set out the background and then the legal framework. I will then set out the core issues to be decided in this appeal. After that I will take each issue separately, analysing the decision of the Employment Appeal Tribunal ("EAT") under appeal and the submissions of the parties and the Commission.
7. In this judgment, the word "adoption" refers to the initial act of an employer in establishing pay scales which incorporate a service-related criterion, as opposed to the word "use" or "application" of a service-related criterion, which refers to the post-establishment implementation of such a criterion in the operation of those pay scales.

BACKGROUND – THE HISTORY OF THIS CASE

8. The background can be shortly stated. Mrs Wilson, the claimant, was employed as a band 3 inspector by the appellant, the Health & Safety Executive ("HSE"). She made her claim for equal pay as long ago as 2002. Her pay was governed by a pay scheme which in part fixed increases in pay according to length of service over ten years, after which time no further increases were awarded. She was paid less than three employees selected as comparators, whose work was rated as equivalent with hers for the purposes of s 1(2)(b) of the 1970 Act. At a hearing in 2003, the tribunal (Mr G.H. Prichard, Ms A Sinclair and Mr L Holbrook) found that the length of service criterion had a disparate impact on female employees because they would tend to have shorter service than males because of career breaks to have children and, in some cases, because of commencing employment at a later date than would otherwise have been the case because of childcare responsibilities. The tribunal also considered whether the service-related pay was objectively justified. The dispute between the parties was not the fact of the adoption of a length of service criterion but the way the length of service criterion was applied. Mr Strawson, a trade union official who gave evidence on Mrs Wilson's behalf and was himself an HSE officer, considered five years was the right level. The actual band adopted by the HSE was ten years, which was the period contended for by them. The HSE also argued that as a result of Danfoss Handels-og Kontorfunktionaerernes Forbund i Danmark v Dansk Arbejdsgiveforening acting on behalf of Danfoss (referred to below as "Danfoss") [1989] IRLR 532, it was to be assumed that service-related benefits were justified and that they did not have to justify any difference in pay between men and women in any event.
9. However, before the tribunal in this case gave judgment, the EAT (HHJ Burke QC, Mr B Benyon and Miss S M Wilson) in Cadman v Health & Safety Executive [2004] ICR 378 (which concerned employees at the HSE in a different band) held that Danfoss meant that an employer did not have to provide special justification for a pay difference resulting from the application of a length of service criterion. In those circumstances the tribunal in Mrs Wilson's case held that her case had to fail. However, they went on to hold that if they had not been required so to hold they would have found that the ten-year period was not justified. They agreed with Mr Strawson that five years was the appropriate period. They recognised that the evidence was limited and anecdotal. The tribunal made it clear that there was no absolutely correct answer and that there was a margin within which they would not interfere. So if, for example, they had found that eight or nine years was appropriate, they might have considered the ten year period justified.
10. Mrs Cadman appealed the decision of the EAT in her case to this court but this court made an order for a reference to the Court of Justice for a preliminary ruling. Mrs Wilson appealed the decision of the tribunal in her case to the EAT but her appeal was stayed pending the result of the reference in Cadman. The Court of Justice delivered its judgment on that reference. Thereafter, Mrs Cadman's case was remitted to the tribunal and stayed pending the outcome of this appeal. In 2007, in the light of the judgment of the Court of Justice in Cadman, Mrs Wilson's appeal to the EAT was remitted to the tribunal, where the HSE argued that Mrs Wilson had failed to meet the requirement to show serious doubts imposed by the Court of Justice in its judgment on the reference in Cadman and that such serious doubts had to relate to the adoption and not the use of a length of service criterion. The tribunal (Mr G.H. Prichard, Ms A Sinclair and Mr L Holbrook) agreed with the HSE's submissions. Mrs Wilson's appeal was heard by the EAT (Elias P, Mr I Ezekiel and Ms P Tatlow). For the reasons explained in more detail below, the EAT held that the claim could proceed but that it would have to be remitted to the tribunal to determine whether Mrs Wilson had shown that there were serious doubts as to whether the ten year period adopted by the HSE was justified.

LEGAL FRAMEWORK

11. The equal pay legislation has adopted the technique of implying an equality clause. This provides that, where a woman is employed to do like work to that of a man in the same employment, any term of the contract that is less favourable to her than a similar clause in a man's contract is modified so as not to be less favourable (see s 1(2)(a) of the 1970 Act). There are similar provisions for work that is not like work but which is rated as equivalent or is work of equal value (s 1(2)(b) and (c)). In this case, Mrs Wilson's work was rated as equivalent to that of her comparators. I omit mention of the provisions dealing with office holders and pay during maternity leave as they are not relevant to this appeal. Subsections (1) and (2) of s 1 of the 1970 Act are so far as material in the following terms:

"Requirement of equal treatment for men and women in same employment

1(1)     If the terms of a contract under which a woman is employed at an establishment in Great Britain do not include (directly or by reference to a collective agreement or otherwise) 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)….

(b)     where the woman is employed on work rated as equivalent with that of a man in the same employment—

(i)     if (apart from the equality clause) any term of the woman's contract determined by the rating of the work 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 and determined by the rating of the work, the woman's contract shall be treated as including such a term;…"

12. Under s 1(3) of the 1970 Act, an employer has a defence ("the genuine material factor defence") if he can show that the reason for the difference is genuinely due to a material factor other than to the difference of sex:

"(3)     An equality clause falling within subsection (2)(a), (b) or (c) above 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."

13. The 1970 Act has to be interpreted in accordance with article 141 of the Treaty (formerly article 119). The Court of Justice has developed a defence of objective justification for an employer in equal treatment cases involving indirect discrimination (see, for example, Cadman at [31], above, paragraph 5). In Bilka-Kaufhaus Gmbh (Appellants) v Weber Von Hartz [1986] IRLR 317 (Case 170/84) at [30 ] and [36], the Court of Justice explained what it meant by objective justification in the context of equal pay and made it clear that the onus of proof of justification is on the employer:

"30. However, if the undertaking is able to show that its pay practice may be explained by objectively justified factors unrelated to any discrimination on grounds of sex there is no breach of Article 119….

36. It is for the national court, which has sole jurisdiction to make findings of fact, to determine whether and to what extent the grounds put forward by an employer to explain the adoption of a pay practice which applies independently of a worker's sex but in fact affects more women than men may be regarded as objectively justified economic grounds. If the national court finds that the measures chosen by Bilka correspond to a real need on the part of the undertaking, are appropriate with a view to achieving the objectives pursued and are necessary to that end, the fact that the measures affect a far greater number of women than men is not sufficient to show that they constitute an infringement of Article 119."

14. The defence of justification is now built into the definition of indirect discrimination contained in article 2(2) of the Burden of Proof Directive (Directive 97/80/EC):

"For purposes of the principle of equal treatment referred to in paragraph 1, indirect discrimination shall exist where an apparently neutral provision, criterion or practice disadvantages a substantially higher proportion of the members of one sex unless that provision, criterion or practice is appropriate and necessary and can be justified by objective factors unrelated to sex."

15. The question whether service-related pay is within article 141 came before the Court of Justice in Danfoss. In that case, the employer paid individual supplements over and above basic rate of pay by reference to a number of criteria, including length of service. The application of these criteria was opaque, and it was not possible to determine which criteria had been applied to any particular employee. The evidence was that female employees on average were paid less than male employees. It was alleged that the system of pay was discriminatory. I need only deal with the decision of the Court of Justice on recourse to a length of service criterion. The Court of Justice held in the following terms that the employer did not have to provide special justification for recourse to a length of service criterion:

"24 In the third place, as regards the criterion of length of service, it is also not to be excluded, as with training, that it may involve less advantageous treatment of women than of men in so far as women have entered the labour market more recently than men or more frequently suffer an interruption of their career. Nevertheless, since length of service goes hand in hand with experience and since experience generally enables the employee to perform his duties better, the employer is free to reward it without having to establish the importance it has in the performance of specific tasks entrusted to the employee.

25 In those circumstances the answer to questions 1(b) and 2(a) and (c) must be that the Equal Pay Directive must be interpreted as meaning that where it appears that the application of criteria, such as the employee's mobility, training or length of service, for the award of pay supplements systematically works to the disadvantage of female employees: 1. the employer must justify recourse to the criterion of mobility if it is understood as referring to adaptability to variable hours and varying places of work, by showing that such adaptability is of importance for the performance of the specific tasks which are entrusted to the employee, but not if that criterion is understood as covering the quality of the work done by the employee; 2. the employer may justify recourse to the criterion of training by showing that such training is of importance for the performance of the specific tasks which are entrusted to the employee; and 3. the employer does not have to provide special justification for recourse to the criterion of length of service."

16. Subsequent to its decision in Danfoss, the Court of Justice gave judgment in a number of cases involving part-time work which cast doubt on its holding in Danfoss, and that caused this court in Cadman v Health & Safety Executive [2005] ICR 1546 to make a reference to the Court of Justice in Cadman asking whether justification was required "for recourse to the criterion of length of service as a determinant of pay where use of that criterion leads to disparities in pay between the men and women to be included in the comparison" (this is the summary given by the Court of Justice in paragraph 26 of its judgment: Cadman v Health & Safety Executive [2006] ICR 1623). The material paragraphs of the decision of the Court of Justice in Cadman represent an expansion of its decision in Danfoss on length of service criteria:

"Recourse to the criterion of length of service

33. In Danfoss [1991] ICR 74, paras 24 and 25, the court, after stating that it is not to be excluded that recourse to the criterion of length of service may involve less advantageous treatment of women than of men, held that the employer does not have to provide special justification for recourse to that criterion.

34. By adopting that position, the court acknowledged that rewarding, in particular, experience acquired which enables the worker to perform his duties better constitutes a legitimate objective of pay policy.

35. As a general rule, recourse to the criterion of length of service is appropriate to attain that objective. Length of service goes hand in hand with experience, and experience generally enables the worker to perform his duties better.

36. The employer is therefore free to reward length of service without having to establish the importance it has in the performance of specific tasks entrusted to the employee.

37. In the same judgment, the court did not, however, exclude the possibility that there may be situations in which recourse to the criterion of length of service must be justified by the employer in detail.

38. That is so, in particular, where the worker provides evidence capable of giving rise to serious doubts as to whether recourse to the criterion of length of service is, in the circumstances, appropriate to attain the above-mentioned objective. It is in such circumstances for the employer to prove that that which is true as a general rule, namely that length of service goes hand in hand with experience and that experience enables the worker to perform his duties better, is also true as regards the job in question.

39. It should be added that where a job classification system based on an evaluation of the work to be carried out is used in determining pay, it is not necessary for the justification for recourse to a certain criterion to relate on an individual basis to the situation of the workers concerned. Therefore, if the objective pursued by recourse to the criterion of length of service is to recognise experience acquired, there is no need to show in the context of such a system that an individual worker has acquired experience during the relevant period which has enabled him to perform his duties better. By contrast, the nature of the work to be carried out must be considered objectively: Rummler [1986] ECR 2101, para 13.

40. It follows from all of the foregoing considerations, that the answer to the first and second questions referred must be that Article 141 EC is to be interpreted as meaning that, where recourse to the criterion of length of service as a determinant of pay leads to disparities in pay, in respect of equal work or work of equal value, between the men and women to be included in the comparison, (i) since, as a general rule, recourse to the criterion of length of service is appropriate to attain the legitimate objective of rewarding experience acquired which enables the worker to perform his duties better, the employer does not have to establish specifically that recourse to that criterion is appropriate to attain that objective as regards a particular job, unless the worker provides evidence capable of raising serious doubts in that regard; (ii) where a job classification system based on an evaluation of the work to be carried out is used in determining pay, there is no need to show that an individual worker has acquired experience during the relevant period which has enabled him to perform his duties better.

…

The temporal effects of this judgment

42 The United Kingdom and Irish Governments take the view that, if the court were contemplating departing from the principles that it laid down in Handels-og Kontorfunktionoernes Forbund I Danmark v Dansk Arbejdsgiverforening, acting on behalf of Danfoss (Case 109/88) [1991] ICR 74, considerations of legal certainty would require a limit on the temporal effects of the judgment to be given.

43 Since this judgment contains only a clarification of the case law in this field, there is no need to limit its temporal effects."

17. In particular, the Court of Justice held that, in an equal pay case, an employer need not objectively justify a length of service pay criterion as a determinant of pay unless the claimant provides "evidence capable of raising serious doubts" that the criterion is appropriate to attain the objective of rewarding experience. This judgment has in turn given rise to debate about the need to justify the use of a length of service criterion as a determinant of pay.

THE ISSUES TO BE DETERMINED ON THIS APPEAL

18. The first issue to be determined is whether the employer ever has to justify the use (as opposed to the adoption) of a length of service criterion. It is said that the Court of Justice recognises that experience is generally valuable to an employer and that as a general rule an employer does not have to provide special justification for recourse to a length of service criterion. (In the case of public service there may be additional reasons for using a service-related criterion as a determinant of pay, such as the need to ensure independence and neutrality). It is further said that the employer does not have to provide justification in any circumstances for the way in which he applies such a criterion. If this is not the law, the second issue seeks to establish when the onus shifts to the employer to provide that justification: the Court of Justice has held that an employee seeking to establish an equal pay claim arising out of a service-related criterion must show "serious doubts" as to the appropriateness of such a criterion. The principal question under issue (2) is the meaning of "serious doubts" for this purpose. Issue (3) is a new issue raised for the first time by Mrs Wilson on this appeal. She submits that a service-related criterion comes within the 1970 Act in any event, and that, under the 1970 Act, the onus is entirely on the employer to prove proportionality.

ISSUE (1): DOES THE EMPLOYER HAVE TO JUSTIFY THE USE (AS OPPOSED TO THE ADOPTION) OF A LENGTH OF SERVICE CRITERION?

Decision of the EAT

19. The EAT ruled in favour of Mrs Wilson. It held that Cadman enables employees to challenge both the adoption of a length of service pay criterion and the way in which it is used. The EAT gave three reasons. Firstly, in Cadman, both the adoption and the use of a length of service pay criterion were challenged. The language used by the Court of Justice was not always rigorous, and so it was not critical that the Court of Justice did not distinguish the issue of adoption of a length of service pay criterion from its application. Secondly, it would be anomalous to distinguish between challenges to the adoption of a length of service pay criterion and challenges to the way such criterion was in fact applied. Thirdly, the gravamen of Cadman was that there was a strong presumption that experience contributes to job performance. There is no reason to limit cases where the presumption could be displaced to cases where the challenge is to the adoption of a length of service pay criterion rather than to the particular way it was applied.

Arguments on this appeal

20. The basic position of the parties on this appeal may be summarised as follows. Miss Jennifer Eady QC, for the HSE, submits that the EAT was wrong in its conclusions on this issue. She submits that the effect of Danfoss is that, once an employer has shown that experience enhances an employee's performance, he does not have justify the adoption of a service-related criterion as a determinant of pay, and that under Cadman it is still possible to challenge only the adoption of a length of service pay criterion and not the way it is in fact used. Miss Dinah Rose QC, for Mrs Wilson, submits that Cadman permits a challenge to both the adoption and use of a length of service criterion as a determinant of pay. She also submits that Cadman does no more than create a rebuttable presumption that the requirements of justification are presumed to be satisfied. She raised a new argument (which she contends should logically be taken first) that it does not really matter for the purposes of these proceedings what Community law is because, in domestic law, once the employee shows that a service-related criterion has an adverse impact on women, the onus shifts to the employer to justify the difference in treatment between men and women, and that, where domestic law gives greater rights in respect of remedies for equal pay, domestic law prevails.
21. Issue (1) therefore requires us to consider sub-issues. The first stage in the argument is to determine what was decided in Cadman. The arguments here have ranged around (i) the terms of the judgment of the Court of Justice in Cadman, (ii) the question whether the Court of Justice attributed any role to proportionality, (iii) the effects of the Court of Justice's rejection of the suggestion made by the Advocate General in his opinion that there should be a temporal limitation on the Court of Justice's judgment and (iv) the rationale for excluding claims based not on the adoption but the use of a length of service criterion. References to proportionality are potentially significant because they may throw light on when the onus of proof shifts to the employer.

(i) Terms of the judgment of the Court of Justice in Cadman

22. Miss Eady submits that the EAT should have had regard to the precise language used by the Court of Justice. She submits that it is significant that the Court of Justice spoke of "recourse" to a length of pay criterion rather than to "the particular scheme or degree of recourse". The latter would be a clear reference to the use of a length of service criterion. On Miss Eady's submission, the EAT wrongly discounted the fact that the Court of Justice was only clarifying its earlier decision in Danfoss (see [43] set in paragraph 16 above).
23. Miss Rose submits that the EAT was correct not to over-analyse the language of the Court of Justice but to interpret it purposively.
24. In my judgment, the language of the judgment of the Court of Justice is undoubtedly opaque. The Court of Justice did not refer to the adoption or use of a service-related criterion: rather it spoke of "recourse" to a length of service criterion (see, for example, [35] and [37] of its judgment). However, one reason for this is given by the EAT. Cadman was a case where adoption and application were both in issue. In other words, the distinction between adoption and use was not at the forefront of the case. The second sentence of [38] of its judgment refers to the possibility of justification "as regards the job in question", but I do not consider that this is determinative since the sentence is merely explicatory of the more general proposition in the first sentence of [38].
25. I would go further and hold that the word "recourse" is not a term of art. It is capable of meaning both the adoption and use of a length of service criterion: there is recourse to such a criterion at both stages.
26. The word "clarification" in [43] of the judgment of the Court of Justice in Cadman is clarification of case law which extended beyond Danfoss itself, and which, as this Court noted in Cadman, had thrown some doubts on to the narrow ruling in Danfoss. Furthermore, as it seems to me, the focus of the judgment of the Court of Justice was on softening the ruling in Danfoss and qualifying its earlier conclusion. The Court of Justice does not necessarily state when it is departing from its earlier jurisprudence (on this, compare Bilka, above, which quietly dropped any reference to the intention of the employer, with the earlier decision of the Court of Justice in Jenkins v Kingsgate (Clothing Productions) Ltd [1998] 1 WLR 972). In my judgment, the important point is that it is not apparent from the terms of its judgment that the Court of Justice sought to limit claims to claims about the adoption of a service-related criterion and to exclude claims about their application.

(ii) Proportionality

27. Miss Eady submits that it is significant that the Court of Justice did not refer to proportionality. The United Kingdom government had argued that the employee should have to show that the length of service pay criterion was wholly disproportionate. In contrast, the Advocate General had held that the onus shifted to the employer when disparate impact was shown. The opinion of the Advocate General discussed the role of proportionality and yet the Court of Justice made no mention of proportionality.
28. Miss Rose submits that Cadman does recognise the role of proportionality. She submits that the word "appropriate" in paragraph 35 and elsewhere in the paragraphs quoted above from the judgment of the Court of Justice is a synonym for proportionality. It would be contrary to Community law to dispense with proportionality because proportionality is an integral part of justification (see for example Enderby v Frenchay Health Authority [1994] ICR 112, ECJ, [27]-[28]).
29. In my judgment, there is nothing significant in the fact that the Court of Justice does not refer to proportionality in terms. As Miss Rose submits, that concept is an integral part of Community law. Miss Eady's argument could be put the other way: if the Court of Justice was intending to limit the reach of equal pay in the way suggested it would surely have said so.
30. I also agree that in general, in this context, appropriateness, to which the Court of Justice did refer in Cadman, is synonymous with proportionality. I consider below (see paragraphs 50 and 51) the implications of this conclusion for the second issue because, in Cadman, the Court of Justice, referring to the burden of proof on the employee, held:

"38. That is so, in particular, where the worker provides evidence capable of giving rise to serious doubts as to whether recourse to the criterion of length of service is, in the circumstances, appropriate to attain the above-mentioned objective..." (emphasis added)

(iii) Temporal limitations

31. Miss Eady submits that significance is to be attached to the fact that the Court of Justice rejected the Advocate General's suggestion that there should be temporal limitations (limiting its retrospective effect) on its judgment, thus indicating that the Court of Justice did not consider that its judgment in Cadman would result in any real change in the law. Temporal limitations in this context are also known as prospective overruling, a doctrine which I discussed in an article, Prospective Overruling (2004) 120 LQR 7, where further details of the doctrine can be found. The jurisprudence of the Court of Justice may be seen from [76] of its judgment in Case C-366/99 Griesmar [2001] ECR 1-9383:

"The Court has taken that step only in quite specific circumstances, where there was a risk of serious economic repercussions owing in particular to a large number of legal relationships entered into in good faith on the basis of rules considered to be validly in force and where it appeared that both individuals and the national authorities had been led into adopting practices which did not comply with Community law by reason of objective, significant uncertainty regarding the implication of Community provisions, and uncertainty to which the conduct of other Member States or the Community institutions may even have contributed (Grzelczyk)."

32. I am not persuaded by Miss Eady's submission. In this case, the Court of Justice is more likely to have taken the view that employers should have anticipated the development of the law because cases following Danfoss indicated that the law had moved on from Danfoss. Nor am I persuaded by a further submission of Miss Eady that the Court of Justice would have to have referred to that later case law if it had intended to extend its ruling in Danfoss. The developments in the law after Danfoss had led this court to make a reference to the Court of Justice for a preliminary ruling in Cadman and were discussed in the opinion of the Advocate General. The position taken by the Advocate General in Cadman was that there should be a far more liberal departure from Danfoss. In particular, he considered that it was sufficient to show that the service-related criterion had a disparate impact. Thus the question of temporal considerations was more relevant to his opinion.

(iv) Rationale for distinguishing between claims based on the adoption of a service-related criterion and claims based on the use of such a criterion

33. Miss Eady submits that a distinction between challenges to the adoption of a length of service pay criterion and challenges to the way such criterion is in fact used is justifiable because it is difficult for a tribunal to determine how seniority correlates to experience and thus value. As the tribunal put it in 2007, there is "no bright line to be drawn in assessing the length of time it would have taken for the claimant or any of her colleagues to give maximum value in terms of job performance" (decision, [28]). The EAT disagreed. I agree with the EAT. There is no reason to distinguish between application and adoption. It would involve permitting an employer to apply a service-related criterion in an obviously arbitrary way without the court being able to intervene. That result would be absurd. It is also inconsistent for the court to hold that an equal pay claim lies where the adoption of a service-related criterion is inappropriate, but not where its use is inappropriate. These factors in my judgment amply answer Miss Eady's argument that, if the Court of Justice had intended to permit claims as respects the application, rather than simply the adoption, of a service-related criterion, it would have said so. The gap in the law that would result cannot be resolved in the way that Miss Eady suggests, namely, simply by a finding that a scheme which produces an arbitrary result in practice is not "genuine". An employer who in perfect good faith adopts a totally discriminatory service-related pay scheme would not be subject to claims for equal pay. That result would again be absurd.
34. It may be difficult for a court to determine whether the use of a service-related criterion was justified. That would be a reason for the court giving the employer a "margin of appreciation", that is, a margin within which it would defer to his commercial judgment, but it is not an argument for excluding review by the courts altogether.
35. I would put the points more strongly than the EAT. The jurisprudence of the Court of Justice shows that equal pay for equal work or work of equal value is a fundamental principle of the Treaty. It is one of the values of the European Union and its achievement is important to the social and economic goals of the European Union. At the level of the European Union, the right to equal pay is taken very seriously. It is also a principle of Community law that rights should be given effective protection, that is, at least adequate protection. The need to protect rights arising from the use of a service-related criterion is not an academic question, as it is common ground that women are often disadvantaged by the use of such a criterion in pay schemes. What Miss Eady contends is that there should be no protection at all in relation to the use of a length of service criterion in pay schemes, and that women who are disadvantaged should have no ground of complaint and certainly no remedy. She does not explain how this could be either logical or fair to the women involved or promote the principles of the Treaty. We must apply what we understand to be Community law and not create legal black holes by taking a technical approach to Community law.

Conclusion on argument that Cadman shows that an employer cannot be required to justify his use of a length of service criterion

36. For the reasons given above, the effect of the decision in Cadman is in my judgment that an employer can be required, in the proceedings in which an equal pay claim is brought, to provide objective justification for his use of a length of service criterion as well as its adoption in the first place. The language used by the Court of Justice is wide enough to include the use as well as the adoption of such criterion in a pay scheme. There is no valid reason for excluding use of such a criterion when adoption is included within the scheme of remedies in respect of equal pay. My conclusion on this issue makes it unnecessary to consider Miss Rose's new argument under this issue.

ISSUE (2): WHEN MUST AN EMPLOYER JUSTIFY THE USE OF A LENGTH OF SERVICE CRITERION?

37. This is an issue about burden of proof: what must an employee show in order that the burden of proof switches to the employer to show that the use of the length of service criterion was appropriate? As already explained, the Court of Justice held that the employee had to show "serious doubts" in certain cases; but it did not amplify that concept. The word "serious" could cover a spectrum of gravity from the non-frivolous to the very grave. There is no procedural stage in English law that uses the same terminology. It may be that the nearest terminology in our domestic law is the requirement that an applicant for an interim injunction should demonstrate that there is a "serious question to be tried" in order to avoid falling at the first hurdle (see American Cyanamid Co v Ethicon Ltd [1975] AC 396, at 407G, per Lord Diplock). This requirement arises in a different context, and it is unnecessary to give further consideration to it.
38. There may be some cases where the employer, rather than the employee, has on any basis to provide detailed justification, for example, where there has been a lack of transparency in using a length of service criterion as a determinant of pay. I leave these cases on one side.
39. On this issue, the EAT came to what is on the face of it a surprising conclusion, namely that, although the tribunal had held that the HSE could not provide objective justification for the way in which it used a length of service criterion as a determinant of pay, nonetheless Mrs Wilson might yet fail on the "serious doubts" test, which was a high one, and that as the tribunal had not applied that test in 2003 the case should be remitted to a tribunal for a yet further hearing to determine that issue. The EAT held that Mrs Wilson had to provide serious evidence, not just evidence capable of raising serious doubts about the use of a length of service pay criterion, but actually raising such doubts. It was not enough that the tribunal should find that there was a genuine issue. The United Kingdom government had submitted before the Court of Justice that the claimant should raise an overwhelming case for saying that a length of service pay criterion was inappropriate and what the Court of Justice had done was to adopt a position that in part accommodated this submission. The EAT considered that on the limited evidence available to it the tribunal might not have had serious doubts. Accordingly the EAT held that the case should be remitted to a tribunal to determine the issue of serious doubts. The EAT gave guidance on future cases and indicated that, in order to determine whether there were serious doubts, there would, contrary to the normal practice of tribunals, have to be a preliminary issue, which could be contested.
40. Both Mrs Wilson and the HSE appeal against the EAT's decision on this issue.
41. Miss Eady argues that the hurdle is a high one, and it is thus inappropriate to treat the "serious doubts" test as a first stage test simply to determine whether there was evidence which could in the absence of some explanation entitle a tribunal to conclude that the criterion was not justified. Miss Eady gives three reasons for a high test. Firstly, on her submission, to have a low test renders the general rule in Cadman meaningless because, in every case, an employer would have to justify his pay scale: the general rule is that justification is not required. If it were a low test, justification would have to be provided in virtually every case. Secondly, on her submission, Mrs Wilson's submission "negates the 'serious doubts' test because any tribunal that found that an employer had failed to objectively justify the whole of his pay scale would be bound to find that the serious doubts test had been met." Thirdly, that submission ignores the fact that, in Cadman, the Court of Justice did not overrule Danfoss or impose a temporal limitation. In general the employer did not have to provide special justification. Miss Eady submits that a length of service pay criterion would have to be wholly disproportionate or dishonest on its face to admit of challenge. There can, therefore, be cases where the service-related pay scheme is not capable of objective justification but the employee cannot show serious doubts. On Miss Eady's submission, there has to be an obvious or overwhelming case as to the inappropriateness of the service-related criterion. Miss Eady seeks to pre-empt any objection that a test of serious doubts set at a high level would not be a preliminary point at all but would deal with all the issues of trial. She submits that there would still need to be, for example, a determination of the issue of objective justification.
42. Miss Eady submits that on the facts of this case Mrs Wilson has not shown serious doubts, and thus the case should not have been remitted for the purpose of determining that issue. Serious doubts had not been shown because the tribunal itself said that, had the pay scale been over seven or eight years, it would not have interfered. The tribunal considered that the appropriate length of an incremental pay scale was a matter of impression.
43. Miss Rose argues for a lower test and submits that the EAT set up too high a threshold. On her submission, all the employee is bound to do is to adduce or point to evidence that is capable of establishing that there is a serious doubt. By serious doubts, she means serious doubts in the sense of a credible reason to doubt the applicability of the general rule to the particular circumstances of her case. Miss Rose submits that it is unlikely that the Court of Justice intended to set a hurdle that would prevent valid claims from succeeding. She submits that there is a low evidential burden and that a low evidential burden is not uncommon in employment law: see, for example, Kuzel v Roche Products Ltd [2008] ICR 799, where this court held that if an employee disputed the reason given for dismissal she had to produce some evidence supporting that case. Miss Rose further submits that, even if a higher hurdle had to be crossed, it was crossed by the tribunal's findings. There was therefore no need to remit this case to the tribunal. The findings of the tribunal, in effect, concluded the claim.
44. Mr Allen's submissions support those of Miss Rose. He submits that the requirement for "serious doubts" cannot be interpreted as reimposing a further burden of proof on the employee because that would be inconsistent with article 4 of the Burden of Proof Directive and article 19 of the recast Equal Treatment Directive (Directive 2006/54/EC) (which came into force on 15 August 2008). Article 4(1) provides that when a claimant establishes "facts from which it may be presumed that there has been direct or indirect discrimination, it shall be for the respondent to prove that there has been no breach of the principle of equal treatment". Article 4(2) gives member states the option of introducing rules of evidence that are more favourable to a claimant.
45. He submits that the only question is whether the application of the general rule in [35] of Cadman is consistent with s 1(3) of the 1970 Act. He submits that it is consistent if the scrutiny applied by the court is proportionate to the gravity of the case advanced by the complainant. He submits that in Danfoss itself, the Danish Arbitration Court had not interpreted the ruling of the Court of Justice in the absolute sense that had required objective justification of aspects of length of service rules. He suggests that the expression "serious doubts" originates in the opinion of Advocate General La Pergola in Hill v Revenue Commissioners [1999] ICR 48: the Advocate General considered that there would be "doubts" if the criterion generalised recourse to length of service so as to extend it indiscriminately even to cases which may not be justified. So, Mr Allen submits, the Court of Justice is not setting out any new burden of proof, but noting its application of the general rule to which it refers in [35] in the circumstances such as those apparently before the Court of Justice. Mr Allen submits that, in order to respect the principle of proportionality, as outlined in Bilka and Case C-381/99 Brunnhofer (Applicant) v Bank Der Österreichischen Postsparkasse Ag (Respondents) [2001] IRLR 571 the court cannot ignore this probable impact of a length of service-related pay scheme and assume that it was justified, whatever the work, whatever the pay increment and whatever the period over which such increments might accrue. He submits that the obligation in s 1(3) is coterminous with the obligation to provide objective justification in European law. In support he cites the dictum of Lord Keith in Rainey v Greater Glasgow Health Board [1987] AC 224 that the scope of section 1(3) of the 1970 Act was identical to article 141, and that there was now no need to construe s 1(3) as conferring greater rights than article 141.
46. My immediate response to this issue is a short one. In my judgment, the Court of Justice was putting forward the test of "serious doubts" as a filter on claims. It clearly envisaged a preliminary test which still left the issues to be decided at a trial. The "serious doubts" test can thus only be applied before a trial. It has no place once the trial has taken place and liability has been found. Accordingly, there was no need in this case for the question of serious doubts to be investigated following the trial. Miss Eady comes close to characterising the conclusion that the "serious doubts" test is satisfied where the claimant makes out her case at trial as impermissible ex post facto rationalisation. In my judgment, that submission in turn is incorrect because it misunderstands the function of the "serious doubts" test.
47. I now turn to my conclusions on the question: what does the test of serious doubts involve in the usual case? Miss Eady's submission in effect treats the "serious doubts" test as a substantive requirement reinforcing the general rule that justification is not required: it is a further jurisdictional requirement, on her submission, because she contemplates that an employee could succeed on an equal pay claim on the issue of justification and yet lose the case because she could not show "serious doubts", and makes it a point of criticism of Mrs Wilson's submission that her submission would not have that effect. I agree with Mr Allen's submission that the addition of such a requirement is not open under the Burden of Proof Directive, and that therefore it is not an interpretation of Cadman which we should consider unless driven to it, which in my judgment we are not. The same applies to Miss Eady's submission that the employee should show a basis for saying that the adoption or use of the length of service is wholly disproportionate or dishonest.
48. I do not accept that a low test would render the general rule in Cadman meaningless because its adoption would in every case require an employer to justify his pay scale. In my judgment, the requirement of "serious doubts" is merely the counterpart of a length of service pay criterion not requiring justification in the usual case. The employee has to show that there is evidence from which, if established at trial, it can properly be found that the general rule does not apply. The employee does not necessarily have to descend into detail. I agree, however, with the EAT ([41] of its judgment) that it is not enough that the evidence is capable of giving rise to serious doubts in the minds of the tribunal without having to convince the tribunal of those doubts. But there would have to be some basis for inferring that the adoption or use (as the case may be) of the length of service criterion was disproportionate. The onus of proof on proportionality does not shift to the employee.
49. The test which I have found does not negate the protection given to the employer against frivolous claims by the general rule identified by the Court of Justice in Danfoss and Cadman since a claim which raises serious doubts cannot be described as trivial. That general rule, derived from Danfoss and importantly now Cadman, still plays its role on the lower test which I held to be the correct test of "serious doubts" as a matter of Community law.
50. The test which I have found is also perfectly consistent with the use of the word "appropriate" in [38] of the judgment of the Court of Justice in Cadman. It will be recalled that the Court of Justice held:

"38. That is so, in particular, where the worker provides evidence capable of giving rise to serious doubts as to whether recourse to the criterion of length of service is, in the circumstances, appropriate to attain the above-mentioned objective..."

51. In paragraph 30 above, I held that the word "appropriate" in the material part of the judgment of the Court of Justice in Cadman is synonymous with proportionality. The passage quoted does not mean that the employee has the onus of showing a lack of proportionality. This is made clear in the immediately preceding paragraph (set out in paragraph 17 above) in which the Court of Justice holds that there may be situations in which recourse to the length of service criterion has to be justified by the employer in detail. This must mean that the employer has the onus of proof on that issue.
52. In this case, the tribunal made it clear that it gave the employer a "margin of appreciation". We have not had full argument on whether they were bound to allow that margin and I proceed on the basis that this was a manner in which the tribunal could properly proceed. When it comes to a question of deciding what criteria should be applied in determining the pay of an employee, the court must necessarily defer to some degree to the judgement of an employer. In applying the test of serious doubts the tribunal must take that into consideration.
53. In this case the tribunal was satisfied that the HSE had exceeded any such margin of appreciation. There is no appeal against its findings of fact in this regard. I agree with Miss Rose that, if "serious doubts" did impose a high hurdle, it was satisfied in the circumstances of this case.
54. I set out below the form of order which I would make. In the circumstances I do not need to deal with Miss Eady's submission that, if she is wrong in her submission that the EAT should not have remitted any issue to the tribunal, then it should have remitted both the issue of serious doubts and the issue of objective justification. She makes this submission on the ground that the issues were linked, and that the HSE should have an opportunity of dealing with objective justification against the context of any particular doubts identified by the tribunal.

ISSUE (3) IS THE USE OF A SERVICE-RELATED CRITERION WITHIN THE 1970 ACT IN ANY EVENT SO THAT THE ONUS IS ON THE EMPLOYER TO PROVE PROPORTIONALITY?

55. This is a new argument raised on behalf of Mrs Wilson that was not raised below and so the EAT did not rule on it. As it was a point of law, we held that this court should hear argument on this point.
56. Miss Rose submits that, even if it were the effect of Cadman that article 141 only applies to the adoption of a service-related pay criterion and not its use, there is nothing in the 1970 Act or the Sex Discrimination Act 1975 ("the 1975 Act") that prevents such a challenge. Article 141 does not prevent a member state from giving employees greater protection under national law.
57. Miss Rose submits that a claim for equal pay must succeed if a woman is paid remuneration which is less than that paid to a man for performing work rated as equivalent pursuant to a length of service criterion which put women at a particular disadvantage and which the employer cannot show to be a proportionate means of meeting a legitimate aim, unless the employer can show that the difference in pay is due to a material factor which is not the difference of sex. I have set out s 1(3) of the 1970 Act in paragraph 12 above. Under that provision, the onus is clearly on the employer. Furthermore, the phrase "difference of sex" used in s 1(3) of the 1970 Act is apt to include any form of discrimination, including indirect discrimination: see Glasgow City Council v Marshall [2000] ICR 196 at 202-203 per Lord Nicholls. The 1970 Act is to be read as a harmonious whole with the 1975 Act: Shields v Coomes (Holdings) Ltd [1978] 1 WLR 1408; Rainey v Greater Glasgow Health Board [1978] AC 224 at 240 per Lord Keith).
58. S 1(2)(b) of the 1975 Act (as amended on 1 October 2005 by regulation 3 of The Employment Equality (Sex Discrimination) Regulations 2005 (SI No 2467), implementing Directive 2002/73 on equal treatment) defines indirect discrimination in a manner which clearly imposes the onus of proof of proportionality on the employer:

"(2)     In any circumstances relevant for the purposes of a provision to which this subsection applies, a person discriminates against a woman if—

(a)     on the ground of her sex, he treats her less favourably than he treats or would treat a man, or

(b)     he applies to her a provision, criterion or practice which he applies or would apply equally to a man, but—

(i)     which puts or would put women at a particular disadvantage when compared with men,

(ii)     which puts her at that disadvantage, and

(iii) which he cannot show to be a proportionate means of achieving a legitimate aim."

59. Furthermore, on Miss Rose's submission, neither the 1975 Act nor the 1970 Act contains any exception for a length of service criterion or imposes a high threshold test such as one of serious doubts. Mr Allen's submissions support those of Miss Rose.
60. Miss Eady submits that the 1970 Act and the 1975 Act are not to be read together alone but with Community law so as to form a single harmonious code dealing with unlawful sex discrimination: see, for example, Strathclyde Regional Council v Wallace [1998] 1 WLR 259, at 265B-F per Lord Browne-Wilkinson. It is not open to this court to (as she puts it) pick and choose which judgments of the Court of Justice to be bound by.
61. Ms Eady points out that s 1 (2) (b) of the 1975 Act (paragraph 58 above) was not in the same form as it is now at the time of the claim. At that time, indirect discrimination occurred if the employer applied:

"to her a provision, criterion or practice which he applies or would apply equally to a man, but – (i) which is such that it would be to the detriment of a considerably larger proportion of women than of men, and (ii) which he cannot show to be justifiable irrespective of the sex of the person to whom it is applied,…".

62. Miss Eady submits that, if it is correct that the 1975 Act can apply to Mrs Wilson without reference to Cadman, it must be the 1975 Act in the form in which it stood at the time of her claim. That made no reference to proportionality. As amended, s 1(2) (b) of the 1975 Act now incorporates Community law on objective justification, and so must be interpreted to give effect to Community law. Domestic courts thus cannot apply Cadman in isolation from the rest of Community law.
63. Issue (3) provides an opportunity to look a little closer at the concepts in s 1 of the 1970 Act and the relationship between the 1970 Act on the one hand and the 1975 Act and Community law on the other hand.
64. The right to equal pay, and the right not to be discriminated against on the grounds of sex, are both aspects of a wider principle of equal treatment. Equal treatment in the prescribed areas is in general to be assured. It is not a socio-economic right, as, for example, the right to housing under the constitution of South Africa. It is not, therefore, simply a right to be achieved progressively or (to use a well-known phrase from American jurisprudence) "with all deliberate speed". It has immediacy. It expresses an ideal of social progress and human dignity. It is an immediate right of equality. It gives the disadvantaged group a voice at the table. The employer has defences, but not excuses.
65. The 1970 Act is a monumental piece of legislation. It was enacted before the United Kingdom became a member of the European Community but it only came into force in 1975 on the same day as the 1975 Act. It does not have all the features of the scheme of the 1975 Act: it does not, for instance, explicitly refer to indirect discrimination, and the class of comparators is limited. It has had to be extended since it was first enacted, for instance, to include work of equal value (Equal Pay (Amendment) Regulations 1983 (SI 1983 No 1794)).
66. It forms, however, a single code with the 1975 Act to deal with unlawful sex discrimination in the field of employment: see, for example, Shields v Coomes per Lord Denning MR at 1416, per Orr LJ at 1421-2 and per Bridge LJ at 1425-6. Both Acts are designed to implement the obligations of the United Kingdom under article 141 and therefore both Acts require to be interpreted so as to be compatible, so far as possible, with Community law.
67. Like the foot of Cinderella, the 1970 Act (as amended from time to time) has for some purposes at least to be fitted into a slipper (Community law). However, unlike Cinderella's slipper, the slipper is not made of glass but of some altogether technologically more advanced material that can expand and improve. Neither the foot nor the slipper can, however, be shrunk in the process of applying the slipper. Moreover, Cinderella is not always bound to wear the slipper: on some occasions she can dance perfectly well on her own two feet without any slipper. In the same way, Community law can add to the 1970 Act and it can require that Act to receive (so far as possible) a contemporary interpretation as Community law itself develops and changes. Domestic law and domestic courts cannot take away rights available under Community law. Domestic law cannot be less favourable to employees than Community law, or, it follows, impose additional hurdles for their claims, as that would be incompatible with Community law. In turn, Community law cannot take away features of the 1970 Act which constitute separate and additional rights for the disadvantaged group because Community law does not prevent a member state from conferring greater rights to equal pay (see, for example, Jenkins v Kingsgate (Clothing Productions) Ltd (1981) 1 WLR 1485; North Cumbria Acute Hospitals NHS Trust v Potter (No 2) [2009] IRLR 176). Community law merely provides minimum guarantees. In particular, Community law does not prevent a Member State from having rules on burden of proof which are more favourable to employees than those prescribed by Community law: see article 4(2) of the Burden of Proof Directive (paragraph 44 above).
68. I thus agree that, as there is no exception for the use of a length of service criterion in the 1970 Act, that Act would apply to a claim for equal pay based on such a claim even if I am wrong in my conclusion on issue (1).
69. If, contrary to my decision on issue (2), the Community law requirement for "serious doubts" creates a new high hurdle to be met by the employee, including some new onus of proof on the employee in a challenge to a length of service criterion as a determinant of pay, the question would arise whether that was inconsistent with the 1970 Act. It is clear that the 1975 Act does not impose such a hurdle or onus: see s 1(2)(b) set out in paragraph 11 above. Moreover, authorities such as Shields make it clear that the 1975 Act and the 1970 Act form a single code for the purposes of employment. This means, as I see it, that they should be interpreted harmoniously so as to make like provision and so that the single code is internally coherent and consistent. The onus of proof in equal pay cases is dealt with in s 1(3) of the 1970 Act; this includes the defence of justification (Strathclyde). Consistently with the 1975 Act, the onus of showing justification (which entails proportionality) under s 1(3) of the 1970 Act is placed on the employer and this is done without any qualification for cases where what is challenged is the use of a service-related criterion as a determinant in pay. It would indeed be anomalous if the 1970 Act were interpreted to impose an onus on the employee with respect to proportionality that was not imposed by the 1975 Act. I do not attach importance to the fact that s 1(2)(b) of the 1975 Act has been amended, since the onus of proving justification was already on the employer. Moreover, in respect of evidential matters, Community law expressly permits member states to choose whether to impose a burden of proof on the employee: see article 4 of the Burden of Proof Directive (paragraph 44 above).
70. In these circumstances, I accept Miss Rose's submission. Had I come to a different view about the meaning of "serious doubts" in Community law, I would have held that domestic law prevailed and that there was no additional substantive hurdle imposed on an employee or onus of proof with respect of proportionality. Indeed, I consider that Miss Rose is right in submitting that a case should be analysed in terms of domestic law first and not in terms of Community law. It is simply that in this case the decision of the EAT with which this appeal was until now concerned was based on Community law and so I have taken those points first.
71. As it is, in my judgment, the employee has only to show that there is evidence from which, if established at trial, it can properly be found that the general rule in Danfoss and Cadman does not apply. This does not amount to a switch in the burden of proof, it is merely a sensible evidential requirement to ensure that the complaint has some prospect of success. It is no greater a requirement than applies in other aspects of employment law, and there is therefore no reason under the 1970 Act or otherwise why the employee should not be expected to fulfil the test as I have described it. It makes good sense that there should be such a requirement to avoid unnecessary claims.

Disposition

72. For the reasons given above I consider that this appeal should be dismissed and that the respondent's notice should be upheld. An order should be made in substitution for that of the EAT which reflects the findings of the tribunal in the 2003 decision of the tribunal. If the other members of this court agree, that means that Mrs Wilson has won on liability. I would direct that Counsel should prepare and if possible agree a minute of order.

Lord Justice Rimer:

73. I agree.

Lord Justice Sedley:

74. I also agree.