ECJ rules on using length of service to determine pay
The European Court of Justice has ruled that employers do not normally have to provide specific justification for using length of service as a criterion in determining pay levels, even when this results in unequal pay between men and women.
The European Court of Justice (ECJ) judgment in Cadman v Health and Safety Executive Case C-17/05 ECJ concerns Mrs Cadman's equal pay claim against the Health and Safety Executive (HSE), in relation to four male comparators who were all paid more than her. The HSE used an incremental pay system that rewarded long service. Mrs Cadman claimed that the use of length of service as a determinant of pay was indirectly discriminatory, as more men than women in the relevant workforce had longer service, and required objective justification under the equal pay legislation.
The Court of Appeal asked the ECJ whether the use of length of service as a criterion in a pay system must be justified in each individual case. The ECJ made the following rulings:
An employer's use of the criterion of length of service attains the legitimate objective of rewarding experience acquired that enables the worker to perform his or her duties better. Therefore, an employer does not normally have to establish specifically that recourse to that criterion is appropriate to attain that objective as regards a particular job.
However, there may be cases where the worker provides evidence that is capable of raising serious doubts as to whether the use of the length of service criterion attains the legitimate objective of rewarding experience. In these circumstances, an employer would be required to provide a detailed justification.
The case now returns to the Court of Appeal for it to determine whether the evidence presented on behalf of Mrs Cadman raises serious doubts as to whether it was appropriate for the HSE to use of length of service in setting pay levels.
Cadman v Health and Safety Executive Case C-17/05 ECJ XpertHR's case law stop press service provides a summary of the decision.
Also
The ever-changing equal pay
landscape Make sure your organisation's pay system does not fall
foul of the changing equality laws, warns Anne-Marie Balfour of Speechly
Bircham.
Advocate
General gives opinion on length of service as a pay criterion IRS
Employment Review reports on the Advocate General's opinion, which the ECJ has
declined to follow.
Cadman v Health and Safety Executive [2004] IRLR 971 CA and Health & Safety Executive v Cadman [2004] IRLR 29 EAT XpertHR provides details of the earlier Court of Appeal and EAT decisions in this case.
No-win, no-fee lawyers fuel rise in equal value claims A sharp rise in the number of equal value claims has been fuelled by the arrival of no-win, no-fee lawyers on the equal pay scene, reports Kate Godwin in Equal Opportunities Review.
Commission rejects mandatory equal pay reviews Employers are let off the hook by the government's Women and Work Commission's report Shaping a fairer future, which largely focuses on measures to facilitate cultural change and encourage schoolgirls to choose non-traditional jobs. It declines to recommend compulsory pay reviews.
Equal pay: the basics XpertHR's employment law reference manual provides guidance on equal pay.
