PREVIOUS
SPEAKERS:
Lindsey Nicoll
Back to list of
speakers
Title:
Part-time Working : Current Legal Issues
5 September 2001
Sex discrimination and equal pay
Prior to the adoption of Council Directive 97/81/EC concerning the Framework Agreement on part time work the protection of part time workers against discrimination was achieved through domestic and EC law on sex discrimination and/or equal pay via the concept of indirect discrimination.
Legislative sources
The Equal Pay Act 1971 (AEPA@)
The Sex Discrimination Act 1975 (ASDA@), section 1(1)(b)
- application
of a condition or requirement
- proportion
of women who can comply is considerably smaller than the proportion
of men
- not justifiable
- to the detriment of the applicant because she cannot comply
Article 141 (ex 119) of the EC Treaty
Council Directive No 75/117/EEC (the Equal Pay Directive)
Council Directive No 76/207/EEC (the Equal Treatment Directive)
Leading cases
R v Secretary of State for Employment, ex parte EOC and Day [1994] IRLR 176
Employment protection threshold for those working more than 15 hours was two years' continuous service but five years for those working less than 15 hours per week; indirectly discriminatory as the rule affected a considerably higher proportion of women than men and the Secretary of State failed to make out the need for a longer qualifying period for part timers.
Barry v Midland Bank plc [1998] IRLR 138
Contractual early severance agreement. Benefits calculated by reference to final salary which disadvantaged those who had worked full time in the past but part time at the termination of the employment. CA held no discrimination as no clear evidence that women disproportionately affected and, in any event, provisions of the agreement justifiable.
Bilka-Kaufhaus Gmbh v Weber [1986] IRLR 138
Membership of occupational pension scheme not open to part time employees unless they had 20 years' service of which 15 were full time. ECJ confirmed that pension benefits are pay for the purpose of Article 119 (now 141) and that the rule was indirectly discriminatory.
Hill & Stapleton [1998] IRLR 466
The applicants were job sharers each working half the number of hours as a full time worker. Each received half full time pay but only progressed half a point up the incremental pay scale each year. Thus, a woman job sharing for two years would only progress one point up the pay scale whereas a full time worker would, over the same period, progress two points up the scale.
Rinner-Kuhn v FWW Spezial-Gebaudesreiningung Gmbh [1989] IRLR 493
German law required employers to pay sick pay to their employees for a period of up to 6 weeks. The rules excluded workers whose hours did not exceed 10 hours per week/ 45 hours per month. The ECJ held that such payments fell within the scope of Article 119 (now 141) and on the basis of the statistical evidence available were indirectly discriminatory and that it would be for the national court to determine the issue of objective justification but that the member State would have to establish that the rule in question was intended to achieve legitimate social policy aims
Nimz v Freie und Hansestadt Hamburg [1991] IRLR 222
The applicant worked 20 hours per week as a University administrator . She was paid on a particular salary scale determined by a collective agreement which provided for progression to the next level after 6 years' full time service. However, for those working part time (between half and three quarters' full time hours) service was counted as half full time, i.e staff who worked less than three quarters time had to serve for 12 years before being eligible to progress to the next level.
Arbeiterwohlfahrt der Stadt Berlin v Botel [1992] IRLR 423
Ms Botel was a part time worker who was elected as a trade union representative. She attended a number of trade union training courses and was given time off by her employer, however, she was only paid for her normal working hours notwithstanding the fact that the training courses exceeded those hours. The training courses did not last as long as a full working week but full time workers attending the courses did not suffer any deduction from pay. The ECJ held that it was prima facie discriminatory for the employer not to pay Ms Botel the same as full time workers who attended the course and that it would be for the employer to justify this practice before the national court.
Stadt Lengerich v Helmig [1996] ICR 35
Under collective agreements those working in excess of full time hours were entitled to overtime. Part time workers who worked more than their contractual hours were not entitled to overtime unless their hours of work exceeded full time hours. The ECJ held that this was compatible with EC law as both groups of workers received the same rate of pay for the same numbers of hours worked.
Problems with the use of concept of indirect discrimination
- the need to establish the application of a condition or requirement
- statistical evidence and the difficulty of identifying the correct pool for comparison, e.g. R v Secretary of State for Employment, ex parte Seymour Smith (No 2)[2000] ICR 244 ; Barry v Midland Bank (see above); LCD v Coker & Osamor [2001]IRLR 116
- Claims by male part timers (see, however, Jesuthasan v London Borough of Hammersmith and Fulham [1998] IRLR 372
Council Directive No 97/81/EC
The Directive gives effect to the Framework Agreement concluded between UNICE (the Union of Industrial and Employers' Confederations of Europe), CEEP (the European Centre of Enterprises with Public Participation) and ETUC (the European Trade Union Confederation). The purpose of the Agreement is to establish a framework for the elimination of discrimination against part time workers and to assist the development of opportunities for part time working on a basis acceptable to employers and workers.
Clause 3 of the Agreement defines the concepts of 'part time worker' and 'comparable full time worker', i.e. in the same establishment having the same type of employment contract or relationship, who is engaged in the same or similar work/occupation, due regard being given to other considerations which may include seniority and qualifications/skills.
Clause 4 of the Agreement sets out the principle of non-discrimination: in respect of employment conditions, part time workers shall not be treated in a less favourable manner than comparable full time workers solely because they work part time unless different treatment is justified on objective grounds.
Clause 5 provides that Member States, following consultation, should identify and review obstacles of a legal or administrative nature which may limit the opportunities for part time work and eliminate them. Clause 5(2) provide that, as far as possible, employers should consider requests for transfer from full time to part time work and vice versa, to provide information about job opportunities, and facilitate access to part time work at all levels of the enterprise including skilled and managerial positions.
The Agreement is without prejudice to any more specific Community provisions including those relating to equal treatment or opportunities for men and women.
The Part Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (SI 2000/1551)
These Regulations implement Directive 97/81. The Secretary of State is empowered under sections 20 and 21 of the Employment Relations Act 1999 to issue a Code of Practice containing guidance for the elimination of discrimination against part time workers, on facilitating opportunities for part time work, facilitating the flexible organisation of working time and matters dealt with in the Framework Agreement. The Code would be admissible in legal proceedings and failure to comply could be taken into account by an employment tribunal. No Code has been issued under this section although the DTI has produced a Guide on the Law and Best Practice which is available on their web-site (www.dti.gov.uk/er/pt-detail.htm).
See also the EOC's Good Practice Guide: How to Manage Flexibility in the Workplace
IDS Employment Law Supplement on Part Time and Atypical Workers
Regulation 5
A part time worker has the right not to be treated by his employer less favourably than the employer treats a comparable full time worker
- as regards the terms of the contract
- being subjected to any other detriment
What is a comparable full time worker ?
Regulation 2(4)
A full time worker is a comparable full time worker if, at the time the less favourable treatment takes place
(a) both workers are
(i) employed by the same employer under the same type of contract and
(ii) engaged in the same or broadly similar work having regard, where relevant, to whether they have a similar level of qualification, skills and experience
(b) the full time worker works at the same establishment or, where there is no such full time worker, at a different establishment.
Employed by the same employer
The Regulations are narrower in scope than UK or EC law on equal pay as the full time worker must be employed by the same employer. There is no equivalent of the concept of an associated employer' under the Equal Pay Act nor may a comparison be made (as under Article 141 of the EC Treaty) with someone in the same service (Lawrence v Regent Office Care Ltd [2000] IRLR 608)
Same type of contract
Regulation 2(3) provides that the following shall be regarded as being employed under different types of contract:
(a) employees under an indefinite contract
(b) employees under a fixed term contract
(c) employees under a contract of apprenticeship
(d) workers who are neither employees nor under a fixed term contract
(e) workers who are not employees but are under a fixed term contract
(f) any other description of worker that it is reasonable for the employer to treat differently from other workers on the ground that workers of that description have a different type of contract.
Regulation 1(2) defines 'employee' and 'worker'.
An employee is an individual who works under a contract of employment
A worker is an individual who works under a contract of employment or any other contract where he undertakes to do or perform personally any work or services for another party to the contract whose status is not that of a client or customer of any profession or business carried on by the individual.
This is the same definition as in section 230 of the Employment Rights Act 1996 and the Working Time Regulations.
Thus, a worker could include agency staff and casual or freelance workers but not, say, barristers or solicitors.
Eg. Watkins v BI Healthcare Ltd t/a Clementine Churchill Hospital ET Case No 6004508/99
Bank nurse working on 'as and when required' basis. Both parties agreed not an employee but the ET held that she was a worker within the definition in the Working Time Regulations.
NB this definition is narrower than that in the Sex Discrimination Act 1975 or the Equal Pay Act 1971
Section 82(1) of the SDA and section 1(6)(a) of the EPA: employment under a contract personally to execute any work or labour
See also Perceval-Price [2000] IRLR 380 in which the Northern Ireland Court of Appeal held that the chairman of an employment tribunal was a worker for the purpose of Article 141 of the EC Treaty and the Equal Treatment Directive.
Are subparagraphs (a) to (f) mutually exclusive ? If so, then it is difficult to imagine what type of contract would fall within the scope of subparagraph (f). If (f) can be read independently of the other subparagraphs then employers can argue that contracts are 'different' where it is reasonable to treat them as such. If the two contracts are different then there is no comparable full time worker and the employer does not have to justify the less favourable treatment.
Engaged in the same or broadly similar work
This concept appears to be similar to the concept of 'like work' under the Equal Pay Act. Again the Regulations are narrower in scope than UK or EC law on equal pay which would allow a comparison to be made with a full time worker who was engaged in work rated as equivalent or work of equal value.
The phrase 'same or similar work' is also qualified by the words 'having regard to whether they have the same level of qualifications, skills and experience'. This enables a comparison to be made between the personal skills, qualifications and experience of the applicant and her chosen comparator. This is a different approach from the Equal Pay Act where the comparison is made between the job or post held by the applicant and that of her comparator. Different levels of personal skills, qualification and experience might constitute a genuine material factor justifying the more favourable treatment of the comparator but would not mean that the applicant and her comparator were not engaged in like work or work of equal value. The onus would be on the employer to show that the difference in treatment was genuinely due to a factor unrelated to sex and that it constitutes a material difference between the applicant's case and that of her comparator.
So far as EC law is concerned, see Wiener Gebietskrankenkasse [1999] 2 IRLR 804. The Viennese health authority employed both graduate psychologists and medical doctors as psychotherapists. The doctors were paid on a higher pay scale than the psychologists who were predominantly women. The ECJ ruled that they were not employed in 'the same work' for the purpose of Article 141 or the Equal Pay Directive owing to their different professional qualifications.
Full time worker works at the same establishment
Comparison must be made with a full time worker at the same establishment unless there is no full time worker employed under the same type of contract at that establishment, in which case the applicant can chose a comparator at a different establishment. More restrictive than UK or EC equal pay law.
Employer may justify the less favourable treatment on objective grounds
Regulation 5 (2) . The right not to be treated less favourably only applies where the treatment is on the ground that the worker is a part time worker and the treatment is not justified on objective grounds.
Bilka Kaufhaus sets out the classic definition of objective justification in EC law. The employer must demonstrate that the pay practice or policy at issue:
- corresponds to a real need on the part of the business
- is an appropriate method of achieving that objective
- is necessary in order to achieve that objective
Regulation 7: unfair dismissal and detrimental treatment
Dismissal automatically unfair if on grounds that the worker has brought proceedings under the Regulations, requested a statement of reasons, given evidence or information in connection with such proceedings, done anything under the Regulations, alleged that the employer has infringed the Regulations or refused to forego a right conferred by the Regulations.
The Regulations do not, however, confer a right to work part time.
E.g. Cast v Croydon College 1998 ICR 500
Cases cited in the IDS Supplement on Part Time and Atypical Workers, EOC's Guide to How to Manage Flexibility in the Workplace
Regulation 8: complaints to employment tribunals
Time limit: 3 months from the date of the less favourable treatment or detriment. Tribunal has power to extend time on just and equitable grounds.
It is for the employer to establish the reason for the less favourable treatment or detriment.
Where the tribunal finds that the complaint is well founded it may:
- make a declaration as to the rights of the applicant and employer
- order the employer to pay compensation
- recommend that the employer take action to obviate or reduce the adverse effect on the complainant
Compensation is to be such that the tribunal considers to be just and equitable having regard to the infringement to which the complaint relates and any loss suffered by the applicant but compensation for infringement of the principle of non-discrimination shall not include compensation for injury to feelings.
The areas in which application of the Regulations will be most likely to apply will relate to hours of work, promotion, pay, access to training, redundancy, benefits in kind, leave and holidays and access to occupational pension schemes.
The position relating to pensions is quite complex both under equal pay/sex discrimination law and the Regulations
Leading cases
Defrenne v The Belgian State [1971] ECR 445
Payments under occupational pensions schemes may fall within the category of pay for the purpose of Article 119.
Defrenne v Sabena (No 2) [1976] ECR 455
ECJ rules that Article 119 has direct effect and may be enforced by individuals without the need for further implementing legislation.
Barber v GRE Assurance Group [1990] ECR I-1889
Principle that pensions are pay for the purpose of Article 119 reaffirmed but temporal limitation imposed: employers are only required to equalise benefits in respect of service from 17 May 1990. Temporal limitation in the judgment given legislative effect in Protocol 2 to the Treaty of Maastricht.
Coloroll Pension Trustees Limited v Russell [1994] ECR I-4389
Claims may be made against scheme administrators as well as the employer.
Vroege v NCTV Instituut [1994] ECR I-4541 and Fisscher v Voorhuis Hengelo BV [1994] ECR I-4583
The right to join an occupational pension scheme falls within the scope of Article 119 of the EC Treaty
Magorrian v Eastern Health and Social Services Board and the Department of Health and Social Security [1998] IRLR 86
The applicants were employed as psychiatric nurses. Mental health officers (MHO's) enjoy more favourable benefits under the occupational pension scheme relating to health service workers. Part time staff are not eligible for MHO status. The applicants had previously worked full time but lost their MHO status when they began to work part time. A question arose as to whether the Barber Protocol operated to limit their claims. The ECJ drew a distinction between the right to equalisation of benefits (subject to the Barber Protocol) and the right to access to an occupational pension scheme. Although the applicants had at all material times been members of the relevant scheme the ECJ treated the MHO provisions as a scheme within a scheme and held that they were entitled to reckon service as from 8 April 1976, the date of the judgment of the Court in Defrenne (No 2).
Preston & Others v Wolverhampton NHS Healthcare Trust and Others (No 2) [2001] ICR 217
Series of test cases in the NHS, local government, teaching, banking and electricity sectors in which the Applicants, in reliance upon Article 119 and the Equal Treatment Directive, contend that the exclusion of part time workers from occupational pension schemes in these sectors was indirectly discriminatory on grounds of sex and cannot be justified. The rules excluding part timers were amended prior to the commencement of proceedings and the claims would have been caught by the two years' arrears rule in the Equal Pay Act (there is a corresponding provision in the Equal Treatment Regulations 1995 (SI 1995 No 3183). In addition, a number of claims were brought more than six months after the end of the employment relationship. A number of questions were referred to the ECJ for a preliminary ruling as to the compatibility of these provisions with EC law.
The combined ruling of the ECJ and the House of Lords is to the effect that the six month time limit for bringing proceedings is compatible with EC law although in cases where an employee is employed under a series of contracts but where there is a stable employment relationship the six month time limit will not begin to run until the employment relationship has ended. However, the two years' limit is incompatible with EC law in so far as it prevents claimants from relying on the whole of their service and claims (provided they are in time) may be back dated to 17 April 1976 (the date of the judgment of the ECJ in Defrenne (No 2)).
The ECJ reaffirmed its earlier judgments in Vroege and Fisscher that in cases where the employee is relying on Article 141 she must pay any employee contributions in respect of the period of service covered by the claim.
Under EC law claims may be brought against both the employer and the trustees/administrators of the occupational pension scheme. If the claimant can show that the exclusion of part time staff had a disproportionate impact on women it would be for the employer to justify their exclusion e.g. disproportionate cost of administering and paying very small pensions; may be more beneficial for low paid staff to remain in SERPS.
NB the Regulations apply to claims for access to occupational pension schemes but under the Regulations claims may only be made against the employer. See also Regulation 8(7) which imposes a retrospective limit of two years on the remedies which the tribunal can award.
Lindsey
Nicoll
Treasury Solicitor's
Department