Looking at a recent case involving British Airways, Joy Drummond discusses whether or not a difference in pay between men and women involves sex discrimination under the Equal Pay Act 1970.

Employers need to ensure that they do not discriminate against their employees on grounds of gender when they make decisions about recruitment, training and promotion, and in the way they award pay and other benefits. Pay and other contractual benefits are covered by the Equal Pay Act, and non-contractual benefits by the Sex Discrimination Act.

Where an employer pays a woman less than a man for doing the same or similar work, the Equal Pay Act may apply to bring her pay up to the level of the man’s. Although this article refers to female claimants, the Equal Pay Act applies equally to men and to women.

Whether or not there is sex discrimination for the purposes of the Equal Pay Act is not always clear-cut.

The Equal Pay Act implies into every employment contract an ‘equality clause’, which ensures that the less favourable terms (or lack of terms) in the woman’s contract are no less favourable than the man’s. This applies not only to pay but also to other contractual terms.

However, the equality clause does not apply where the employer can prove that the difference between the contractual terms of the man and the woman is genuinely due to a material factor which is not the difference of sex. This is known as the ‘genuine material factor defence’.

Sex discrimination

European and English case law has established that the genuine material factor defence will not succeed where the factor relied on by the employer as being the cause of the difference involves either direct or indirect sex discrimination.

Direct sex discrimination is where the woman is treated less favourably than the man because she is a woman. Indirect sex discrimination is where the same rule, practice or condition is applied to everyone but the way the arrangements operate has a disproportionate adverse impact on women compared to men.

Even if there is indirect sex discrimination, the employer will still have a defence if he can show that the difference in the pay or other term between the man and the woman is justifiable. To be justifiable the discriminatory arrangements must be a proportionate means of achieving a legitimate aim.

In their recent judgment in the case of Grundy v British Airways, the Court of Appeal considered the correct way of deciding whether or not the difference in pay involves indirect sex discrimination.

The facts of this case are as follows:

• Mrs Grundy has been employed by British Airways as a member of cabin crew since 1987.




• Initially she worked full time, but after several months she moved to a type of contract known as support cabin crew, which was, until 1994, the only contract under which British Airways cabin crew could work part time.




• The support cabin crew did not have a contract that entitled them to an increasing annual pay scale, unlike the rest of the cabin crew. (Neither did they initially have paid holiday or sick pay, nor did they have access to a pension scheme).




• As a result, when the support cabin crew contract was abolished in 2002, and Mrs Grundy moved to the cabin crew contract (working 75%, which was now available) her pay was substantially less than the pay of a male member of cabin crew doing the same work as her and with comparable service to hers, but who had never worked on a support cabin crew contract.

At the time of the Employment Tribunal hearing, Mrs Grundy’s male comparator was earning considerably more than her. In 2002, the total number of cabin crew was 13,127, of which 8,994 were women and 4,133 were men, giving a ratio of women to men of about 2:1.

Of these cabin crew, only 45 were support cabin crew who suffered the disadvantage referred to above. Of the 45 support cabin crew, 42 were women and 3 were men, giving a ratio of women to men of about 14:1. This meant that anything that disadvantaged support cabin crew was going to hurt a far larger proportion of women than men.

However, because the support cabin crew group was relatively small compared to the rest of the cabin crew, far fewer women were disadvantaged in actual numbers. On the basis of these figures, the Employment Tribunal concluded that the difference between the percentage of all women who were advantaged (99.53 per cent) compared to the percentage of all men who were advantaged (99.93 per cent) was insignificant. However, of the disadvantaged support cabin crew, 86.67 per cent more women than men were disadvantaged.

Some previous authorities had indicated that the Employment Tribunal had to look only at the advantaged group. If that was right, because the support cabin crew group was very small compared to the total number of cabin crew, and about two thirds of the total cabin crew were female, there would be no finding of sex discrimination because there was no significant difference between the percentage of men advantaged and the percentage of women advantaged, even though the disadvantaged group was overwhelmingly female.

In this case, the Court of Appeal ruled that it is not necessary to focus just on the men and women who are advantaged. The Court of Appeal said that the right approach depends on the facts of each case and whether there is a causative link between the claimant’s sex and the fact that she is paid less than her comparator.

In the Grundy case, the Employment Tribunal looked at both the advantaged group and the disadvantaged group but based their finding that there was a disproportionate adverse impact on women by focusing on the disadvantaged group.

The Court of Appeal found the Tribunal had made no error of law in taking this approach and that, therefore, their finding of fact stood.

British Airways’ cross appeal on their defence of justification has yet to be heard.

Joy Drummond is an employment partner at Simpson Millar, who acted for the claimant Vivienne Grundy. Vivienne Grundy was supported by her union; Unite the Union.