Employment law: All things being equal

The principle of equal pay states that men and women should receive equal treatment in their terms of employment where their roles are considered “work of equal value”. Asda is facing a long-running equal pay claim, which serves as a timely reminder of the importance of not falling foul of this area of law. Legal background Where an employee and a comparator of the opposite gender are employed on equal work, the worse-off employee can bring an equal pay claim to harmonise their pay. Theoretically, a man can be paid more than a woman for equal work. However, a heavy burden is imposed on the employer to establish that the discrepancy is due to a “genuine material factor” (eg seniority/length of service) and is not based on the employee’s sex. Recent developments In the ongoing case of ASDA Stores Ltd v Brierley and others more than 7,000 claimants (predominantly female) are bringing a collective equal pay claim against Asda, comparing their work in retail stores against those employees (mainly men) who work in distribution centres. Asda argues that the demands of the jobs are different and that the pay discrepancy has a legitimate basis because the two groups of workers’ pay rates are set using different methods. On 31 August 2017, the EAT dismissed Asda’s appeal (UKEAT/0011/17/DM), upholding a previous ruling that female retail workers could compare their work to their male colleagues in the distribution centres. The EAT stated that the two groups’ work is of equal value and that their pay should therefore be comparable. Asda has been granted permission to appeal, so this matter is not over yet. How to avoid equal pay claims Be transparent. Explain to your employees how their pay and any bonus structures are calculated (this is their legal entitlement).  Be prepared. The new Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 mean that any employer who employs more than 250 people will be obliged to publish their gender pay gap figures by April 2018. Be aware that claims may arise should gaps be discovered by employees. Take action. Conduct a pay review and action any unjustified discrepancies. Remember that when deciding if a woman’s contract is less favourable than her comparator, each contractual term of the same subject matter must be considered separately. For instance, employers cannot argue that because a woman has better holiday provisions than her comparator, she should not be entitled to the same basic rate of pay. Ex-offenders: time to hire? In a YouGov survey, 50% of businesses that responded stated that they would not consider employing an ex-offender. While Timpson and Virgin Trains are leading the way to change employer attitudes by actively recruiting ex-offenders, many businesses still give significant weight to the presumed risk to the security of their business in doing so, as well as to concerns of reliability and damage to their image. What are the advantages of hiring ex-offenders? Common misconceptions mean that employers do not necessarily consider the benefits of employing an ex-offender, such as: improving diversification in the workplace; resolving any skills shortages; providing good PR for the business as a demonstration of commitment to corporate social responsibility; and councils may look favourably on employers who do this. A December 2016 Work and Pensions Committee report proposed tax incentives, such as a reduction in National Insurance contributions, for employers who actively recruit ex-offenders. It is thought that a reform of criminal record disclosure obligations would help accelerate a change in employer attitudes and increase the employability rates of ex-offenders. What are the current rules on checking potential employees and disclosure? Employers are able to obtain an individual’s criminal record history by carrying out an official check through the Disclosure and Barring Service, or by requesting voluntary disclosure by the prospective employee. However, applicants are not required to disclose information about “spent” convictions or cautions, save where the occupation falls within a statutory exception, such as if the job involves caring for children or the vulnerable or is in a profession such as law or accountancy. A conviction of four years or less will be “spent” (ie, wiped clean) after a certain period of time has passed, known as the “rehabilitation period”, which varies depending on the type (custodial or non-custodial) and length of the sentence, The rehabilitation period is halved if the ex-offender was under 18 when convicted, and cautions are spent immediately. An ex-offender should not be prejudiced by failing to disclose a spent conviction and any dismissal on the grounds of a failure to disclose will be unlawful, save where the occupation falls within one of the exceptions. What next? A report published by Labour MP David Lammy on 8 September 2017 suggests that we could learn from the US approach with ex-offenders applying to have their case heard by a judge where they could prove they have reformed. The judge could then decide whether to “seal” the record. If approved, the record would still exist, but the offender would not need to disclose it and employers would not be able to access it. It is suggested that this will provide a more flexible approach demonstrating recognition that “rehabilitation” is a fresh start.  A shift to change employer attitudes will be necessary in order for these recommendations to affect the ex-offender employment rate. Clare Gilroy-Scott is a partner and Emily Kearsey is a solicitor in the employment team at Goodman Derrick LLP