Equal pay

Introduction

The Equality Act 2010 applies to most categories of staff who may work in a business, including workers, employees, directors and apprentices (collectively referred to as workers in this section), but not volunteers.

The rights of men and women to equal pay for equal work is a requirement of the Equality Act 2010. Though both men and women can claim equal pay, we refer to a woman claiming equal pay in this section for simplicity and to reflect the fact that most claimants are women.

Equal pay

Equal pay applies to all contractual terms, not just pay and includes:

• Basic pay
• Hours of work
• Sick pay
• Non-discretionary bonuses
• Overtime rates and allowances
• Performance-related benefits
• Benefits in kind
• Severance and redundancy pay
• Access to, and benefits under, pension schemes

The law

A woman is entitled to be treated no less favourably in terms of her pay than a man (a 'comparator') in the same employment, where she is employed on 'like work' with a man. The position is the same where the work is 'rated as equivalent' or the work is of equal value to that of the man in the same employment.

The Equality Act now allows a claim to be made even if no real comparator can be found. This means that a woman who can provide evidence that she would have been paid more if a man was doing her job, may have a claim, even if there is no-one of the opposite sex in the business doing 'like work', 'work rated as equivalent', or 'work of equal value'. The test is that their terms and conditions must be attributable to a single body/source that's responsible for setting or continuing the pay inequality and can restore equal treatment. This also applies where their terms are governed by the same collective agreement.

What is 'like work'?

This means work that is the same or broadly similar, including tasks that require similar knowledge and skills, where any differences in the work are not of practical importance.

The work does not have to be identical. Jobs that are the same or broadly similar should have the same pay, irrespective of whether they are done by a man or by a woman. Jobs that appear to be dissimilar can be seen as like work, e.g. lecturers of different subjects within the same employment.

What is 'rated as equivalent'?

The term 'rated as equivalent' means that a job evaluation scheme taking into account the demands on the worker in terms of, for example, effort, skill and decision making, has rated the roles as being equivalent in terms of grade/value. Once a job evaluation has been carried out, the tribunal is bound by it, provided it is not discriminatory.

What is equal value?

In the absence of a job evaluation scheme, a woman (or man) may still argue that her job and that of her comparator are of equal value. This means that the job is not similar and has not been rated as equivalent, but it's still of equal value in terms of demands such as the effort, skill and decision making.

A woman must show that she has reasonable grounds that the work is of equal value. The employer should then submit their defence to that argument. If the defence fails, the tribunal will then commission a report from an independent expert who will evaluate the job, and the tribunal will decide based on this evidence.