Equal Pay Case
February 6 2007 - Bridget Bodman, a former accountant at manufacturing company API Group received £25 000 compensation in November 2006 in an equal pay case supported by the Equal Opportunities Commission (EOC). The EOC quotes the Office of National Statistics 2006 Annual Survey of Hours and Earnings that identified a full-time hourly gender pay gap of 17 per cent (22.3 per cent in the private sector compared to 13.4 per cent in the public sector).
Equal pay claimants are usually required to identify a comparator; that is, someone receiving higher pay for undertaking a similar role at the pertinent time. Ms Bodman successfully used her male successor as a comparator. This type of claim was established in the UK in 1996 (Diocese of Hallam Trustee v. Connaughton) but has rarely been used.
API Group employs approximately 1500 people and has offices in the UK, Europe, USA and Asia Pacific. Ms Bodman was appointed as a group accountant in April 2000 and was promoted to financial controller in March 2001. Questioning the salary and benefits offered to her male replacement, she requested that the company complete an equal pay questionnaire. It emerged that her successor was paid £8000 more and received an £8640 car allowance as well as additional benefits.
A second element to the claim against another comparator when both were employed as group financial controller was not successful. However, the tribunal found that Ms Bodman had been employed to do comparable work to her successor as group accountant and that the company had no genuine material factor defence for the differences in their salaries.
The tribunal stated that:
"The absence of both clear criteria and process for determining pay awards and bonus payments creates a climate where pay discrimination on gender grounds can operate, consciously or unconsciously, unsuspected, undetected and unchallenged."
The judgement continued:
"The absence of any of the checks and balances recommended by the EOC in the Code of Practice, and the absence of any systems or process of the company's own devising, makes it extremely hard for the company to rebut the taint of sex discrimination."
Bridget Bodman said:
"I am delighted to win my equal pay case. Although the process has been a long and stressful experience, I felt I had to make a stand against my former employer for ignoring the law. I hope that other companies will learn from this settlement and pay their staff fairly so that employees do not have to resort to bringing them to court."
The EOC argues that this case underlines the need for employers to ensure that pay systems are transparent and that employees understand both their pay rate and how individual remuneration is arrived at. By avoiding uncertainty and perceptions of unfairness, the possibility of individual claims will be reduced. A equal pay review will help identify unjustifiable differences.
Jenny Watson, chair of the EOC commented:
"This case demonstrates that equal pay is not simply about people working side-by-side being paid the same salary for doing the same job. Employers can of course continue to conduct individual pay negotiations with new members of staff. But they must always have both good record keeping and a clear justification for the decision they reach if they are to comply with equal pay law.
"Transparency can be a particular challenge for private sector employers where fewer employers undertake equal pay reviews and where research shows the pay gap is significantly higher. This tribunal decision sends out a clear message for employers to ensure that their pay systems are transparent, otherwise they leave themselves open to costly claims."