Asda loses Court of Appeal case over equal pay

Asda shopworkers have won a landmark ruling in a long-running equal pay dispute covering thousands of workers, leaving the supermarket giant facing substantial payments of back pay

This long-awaited Court of Appeal decision has confirmed that predominantly female retail workers in ASDA stores are legally able to compare their roles to predominantly male workers in the company’s depots.

In Asda Stores Ltd V Brierley and Ors [2019] EWCA Civ 44, about 30,000 claimants, mostly women, working in Asda supermarkets brought equal pay claims against their employer, Asda Stores Ltd, on the basis of comparisons with the pay of male employees employed at depots as part of Asda’s distribution operation.

The Court of Appeal has now ruled in favour of the employees after hearings at the Employment Tribunal and Employment Appeal Tribunal in an action affecting tens of thousands of workers, effectively extending how far an equal pay claim can be applied. This follows a three-day hearing last October.

ASDA will not be able to appeal this decision to the Supreme Court so the claimants will now be able to proceed with their substantive claim.

The Court of Appeal upheld earlier rulings on the case, stating that: ‘The essential reason why in my view the Judge's conclusion was open to him – indeed I believe right – is that for both classes (ie, retail workers and distribution workers) Asda applied common terms and conditions wherever they work. The effect of the case-law, and of North in particular, is that in such a case "wherever they work" extends even to a workplace where they would never in practice work because the nature of its operations is so different, as it was in both Leverton and North itself.

‘The contrast is with a situation where there were no common "distribution terms", so that what terms a distribution worker enjoyed would depend on where they worked. If that had been the case here (as it may have been pre-2003) the outcome would be different, because it would be impossible to say "if a distribution worker worked in a store these are the terms that would apply to him",’ the Court said.

Commenting on the Asda ruling, Croner pay and reward manager Clare Parkinson said: ‘Although the Equality Act 2010 places an obligation on employers to pay all male and female employees doing the same job equally, it can also allow for a comparison to be made between jobs with broadly similar demands and experience required.

‘This means that if a female worker can demonstrate her role is broadly similar to a male colleague’s but he is getting paid more than her, this action may amount to sex discrimination on the part of the employer. This latest development in the long running Asda equal pay case has now outlined that job roles can still be considered comparable even in situations where the employees operate in different market sectors and pay is distributed through differing market rates.’

Parkinson added: ‘Going forward, the claimants will have to demonstrate that their roles are of equal value and, if this is the case, the burden will be on Asda to outline that there is a reason other than sex discrimination which means the roles should not be paid equally.

‘If successful, the company could be liable for substantial payments of back pay, covering hundreds of workers over a six-year period.’

The decision comes at a time when pay equality and worker status is under the spotlight, with gender pay gap reporting required for larger businesses and the proposed legislation under the government's Good Work Plan, set to come into effect in April 2020.

‘Employers should bear in mind that this issue does remain generally unexplored within the private sector and there is therefore an expectation that, with the introduction of gender pay gap reporting, the number of equal pay claims are likely to increase,’ Parkinson warned.

‘This judgment reminds employers that they may be accused of facilitating unequal pay without intending to do so.

‘Although this case is far from over, and it is possible that future courts will find against the claimants, it has already given rise to a number of similar accusations being made against other large retailers including Tesco, Sainsburys and Morrisons.’

Report by Sara White

Read the Croner-i case report on the Court of Appeal ruling, Asda Stores Ltd V Brierley and Ors [2019] EWCA Civ 44

For further information on equal pay disputes, gender pay gap reporting, view Croner HR and employment law services

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