Does Incremental pay scales based on length of service disadvantage women?
When it comes to equal pay at work, women are more likely to be paid less because they have fewer years’ service either because of career breaks to look after children or because they are relatively new entrants into traditionally male-dominated professions, and therefore are likely to be discriminated against at work.
In The employment law case of Wilson v Health and Safety Executive (HSE), Mrs Wilson, a health and safety inspector, claimed that the somewhat complex pay system operated by the HSE, which rewarded pay in part by reference to length of service, constituted a breach of the Equal Pay Act 1970 and therefore could constitute discrimination at work.
She accepted that the nature of the job was such that performance would be likely to improve with experience for the first few years but she did not believe that the HSE was justified in applying this criterion over a ten year period. Was Mrs Wilson discriminated against at work? The Employment Tribunal gave its decision in the light of the judgment of the Employment Appeal Tribunal in a similar case, Cadman v HSE. The Employment Appeal Tribunal had concluded that the effect of European case law was that with respect to full-time workers it was not necessary for an employer to justify a pay difference resulting from the application of length of service criterion.
Although the Employment Tribunal was inclined to think that a ten-year period was not justified to reach the requisite level of skill in this case, it found that Mrs Wilson’s case for discrimination at work must fail.
Mrs Wilson appealed to the Employment Appeal Tribunal. The appeal was stayed (left on file without the court giving a decision in relation to her claim for discrimination at work) because the Cadman case had by this time been appealed and the Court of Appeal had made reference to the European Court of Justice for a ruling as to whether differences in pay based on length of service need to be objectively justified by the employer to be lawful.
The European Court of Justice judged that as a general rule the criterion of length of service is appropriate to attain the legitimate objective of rewarding experience acquired which enables the worker to perform his or her duties better.
An employer does not generally have to produce specific proof in order to justify the practice unless a worker provides evidence capable of raising serious doubts as to whether the link between pay and length of service is in fact rewarding experience that enables the worker to perform better. In that case, the employer must demonstrate the absence of unlawful discrimination.
When Mrs Wilson’s appeal was heard, the Employment Appeal Tribunal identified that the real issue to be determined was whether once it has been accepted that the nature of the job is such that pay can properly be made to depend on length of service, is that the end of the Employment Tribunal’s enquiry or can it also consider, in an appropriate case, whether the degree of recourse to length of service (and therefore, experience) can be justified? Although the European Court of Justice’s judgment in the Cadman case had not provided the desired clarity on this point, in the Employment Appeal Tribunal’s view the Employment Tribunal does have the power to question whether the length of service criterion used by the employer is justified in circumstances where the employee has raised serious doubts as to whether or not it is.
To do so, the Employment Tribunal would have to be satisfied that that there was ‘real reason to suspect that the employer has stepped beyond the margins which can properly be afforded to employers when considering whether added experience typically improves job performance’.
The matter was referred to a fresh Tribunal to consider the issue of serious doubts again.
Does this article apply to you? Contact Yair Cohen for assistance in ensuring that your pay scheme complies with the law.
