Landmark ruling opens way to change in workplace pay policies

Small businesses are feeling the shockwaves of an equal pay ruling following a recent Supreme Court ruling.

The landmark judgment in the case of North and others v Dumfries and Galloway Council has opened the way to women employees raising a case for equal pay by comparing themselves to male workers at different sites.

The case involved 251 classroom and nursery assistants who set out to compare their terms of employment with those of male manual workers, such as refuse collectors and groundsmen based at various sites in the local authority’s area. The men were paid substantial bonuses on top of their basic pay and the women claimed that paying such bonuses to men who did jobs of ‘equal value’ was discriminatory.

This would have been simple if the classroom assistants and the groundsmen had been employed under the same collective agreement, but the women were employed under one set of conditions and the men under another.

When first heard by an employment tribunal, the tribunal approached the issue by posing the question whether, if the men had had been employed in the schools and nurseries, they would have been subject to the same conditions as the women, and it concluded that they would not. The Council objected to this approach saying that there was no real possibility of the groundsmen and refuse collectors being employed in the schools and nurseries, it simply wasn’t feasible.

But when the case reached the Supreme Court, the judges ruled that the tribunal’s approach was exactly right and that whether or not it was feasible for the men to work in the same workplace as the women was irrelevant.

Having won the right to compare themselves with their male counterparts at other sites, the way is open for the women to establish that their work was of ‘equal value’ to that of the men they chose to compare themselves with.

Now, the ruling on these public sector workers is expected to have an impact on smaller businesses who often negotiate pay settlements with employees on an individual basis.

Said employment law specialist David Hetherington of Greenwich town solicitors Grant Saw Solicitors LLP: “This decision is a warning light for all businesses to take a long hard look at their attitude to pay. It’s a dangerous approach to favour one employee over another, thinking such things are private – the reality is that they rarely are.”

He added: “Having a pay policy that withstands transparency is going to be the safest route for the future.”

North and others (Appellants) v Dumfries and Galloway Council (Respondent) (Scotland)

Click to view The Supreme Court Judgment document >

This is not legal advice; it is intended to provide information of general interest about current legal issues.