SIGNIFICANT MILESTONE IN THE ASDA EQUAL PAY CASE – IMPACT FOR EMPLOYERS

Patricia Marleau of our corporate employment team looks at the significance of the recent ruling in the above case for employers.  If you have any questions, please contact our team for advice on 01905 900 919 or email patricia@bradleyhayneslaw.co.uk.

On 26 March 2021, Asda’s retail employees won a key appeal in the Supreme Court in their long-running equal pay battle with the supermarket. The mainly female employees brought an equal pay claim, arguing that they should be paid at the same rate as their mainly male distribution colleagues based at a different establishment. Asda argued that their distribution employees had different terms and conditions of employment and that the claim should therefore be struck out.

For an equal value claim to succeed, a suitable comparator must first be identified. If the chosen comparator is employed at a different establishment of the employer, their terms and conditions of employment must be broadly the same. In other words, there must be ‘common terms’.

We cannot ignore the recent Supreme Court ruling in the Asda case where it was determined that the ‘common terms’ threshold is relatively low.

Now that Asda’s retail employees have overcome the first hurdle and can have their roles compared to distribution workers to establish if they are of equal value, their fight for equal pay is not over yet. They now have the burden to prove their work is of equal value in terms of demands made on them by reference to such factors as effort, skill and decision-making. In response, Asda will be given the opportunity to show that there were genuine material factors justifying the difference in treatment between retail and distribution workers, unrelated to their sex.

Given that the Supreme Court ruling on the relatively low ‘common terms’ threshold, we are urging employers to review and consider their staffing models and pay structures to protect their business against future equal pay claims. Whilst supermarkets and retail stores are currently in the firing line, other businesses can expect employees to look at pay differentials, particularly with ongoing pay gap reporting.

For any equal pay or any employment advice, please contact Patricia in our Corporate Employment Team on 01905 900919 or email her at patricia@bradleyhayneslaw.co.uk.