Labour & European Law Review Weekly Issue 254 02 February 2012
The Equality Act says that employers can defend a difference in pay - known as the material factor defence (MFD) - if they can show it has nothing to do with sex. In Secretary of State for Justice v Bowling, the Employment Appeal Tribunal (EAT) said that a difference in pay at the recruitment stage can still act as an MFD in subsequent years.
The claimant’s union, PCS, instructed Thompsons to act on her behalf.
Ms Bowling started work for the prison service in Newport in August 2008. As a new entrant, she was placed at the bottom of a 7-point salary scale. A month later Mr Paul Thomas was recruited to the same role but, as he had more relevant experience, was placed two points higher on the incremental scale.
They received the same assessment in the annual review processes in April 2009 and 2010 and progressed up the pay scale by the same amount, retaining the difference in pay.
In August 2010, Ms Bowling lodged an equal pay claim, arguing that as she was doing “like work” with Mr Thomas, she should be paid the same as him. The prison service said it had a MFD - that the variation was justified by Mr Thomas’s additional skills and experience and had nothing to do with gender.
The Tribunal agreed with the employer that his experience constituted a material factor other than sex that explained the differential in the first year.
However, it said it was clear that, after the appraisals in 2009 and 2010, Ms Bowling had acquired sufficient experience to “catch up” with him. The prison service could not therefore rely on this “significant and relevant factor” to justify the difference.
The EAT disagreed. It held that the point at which an employee starts on an incremental scale is bound to affect their pay, relative to that of their colleagues, in each subsequent year until they reach the top.
As Mr Thomas started two points above Ms Bowling, it was inevitable there would be a differential (subject to adequate performance) in each of the following six years. If the original differential had nothing to do with sex, then nor did the differential in those later years.
Even if Ms Bowling could subsequently show that she had achieved the same performance rating as Mr Thomas, his previous experience was the reason that he had been placed two points ahead of her on the scale.
It criticised the Tribunal for labelling the employer’s explanation as “historical”, saying that “all causes are, in one sense, historic in that they occur in the past: the real question is whether they have ceased to operate as an explanation for the differential complained of as at the date under consideration. The “catching up” relied on by the Tribunal may (perhaps) have undermined the justification for the differential but it did not undermine its causative effect”.
The EAT said that as the policy would have applied equally to a woman with Mr Thomas’s skills and experience, and as men as well as women came into the grade at the normal starting-point, Ms Bowling’s claim could not succeed.
This is a further attempt by the courts to ‘tighten the screw’ and limit the remit of equal pay claims.