Headlines regarding the fallout of Birmingham City Council’s £760m pay claims (on top of the £1.1bn paid in June) have put the issue of equal pay firmly in the spotlight.
The Equal Pay Act was largely replaced by the Equality Act 2010, but equal pay is still a major issue, and especially the gender pay gap.
The obvious question is whether it’s illegal to pay someone less for doing the same job, or are there circumstances where differences in pay are acceptable?
The equal pay issue
This relates to less favourable treatment between men and women over pay and conditions and applies to employees; apprentices; agency workers; people on full-time, part-time, or temporary contracts; and self-employed people hired on a personal basis to carry out work.
Under the law, men and women should receive equal pay for equal work, defined as:
- Work where jobs and skills are the same or similar
- Work rated as equivalent through an analytical job evaluation study or job evaluation scheme
- Work of equal value, where the work isn’t similar or rated as equivalent, but the level of skills, training, responsibility, or demands are of equal value with reference to a comparator.
When can an employee make a claim?
Under the Equality Act 2010, an employee can make a claim against an employer if their terms and conditions of employment are less favourable than a comparator. The employee making the claim and the comparator must be of different sex and doing like work, equivalent work, or work of equal value as above.
For the purposes of an equal pay claim, terms and conditions of employment include:
- Basic salary and wages
- Working hours
- Annual leave allowance and holiday pay
- Sick, overtime, redundancy, or performance-related pay
- Employee benefits, such as company cars.
In certain circumstances, there can be differences in pay and conditions which might be lawful e.g. different levels of skill and experience, location or shift work.
Every defence will depend on the facts of the case, and some factors which succeed in one claim might fail in another. Therefore, it is always important to seek specialist advice.