Case of the week: Barts & The London NHS Trust v Verma

Barts & The London NHS Trust v Verma

Facts

This case deals with the issue of a pay-protection policy and how it should be applied. Dr Verma trained as a dentist in India and subsequently qualified as a doctor. She specialised in oral and maxillofacial surgery and, to practice as a consultant in the UK, needed to complete a training year that is normally undertaken only by newly qualified doctors. The training year was a full-time role of 38.5 hours per week, with a salary of £23,762.

Dr Verma was employed as a part-time practitioner and worked two shifts (seven hours) per week, earning £11,366 per year. As a practitioner, Dr Verma could have worked a maximum of five shifts (17.5 hours) per week and earned up to £28,845.

The NHS standard terms and conditions provide for pay protection in circumstances where an employee would suffer a pay reduction to complete training that will further his or her career, to avoid employees being deterred from doing so. Dr Verma claimed that, for the purposes of the pay-protection clause, her salary should be taken as that of a trust grade doctor, which is significantly higher than the training salary, rather than her part-time practitioner salary. When the trust refused to pay her at a doctor’s level, she brought a claim for unlawful deduction from wages.

Decision

The employment tribunal held that the pay-protection clause did apply to Dr Verma, and that the correct protected rate of pay was equivalent to the amount that Dr Verma could have earned working the maximum five shifts per week in her practitioner role, which was £28,845.

The Employment Appeal Tribunal disagreed. It used Dr Verma’s actual salary and hours to calculate her hourly rate. It converted this into a full-time equivalent salary of £65,931 based on a working week of 38.5 hours.

On appeal, the Court of Appeal was divided, but held by a majority of two to one that the protection extended only to the actual pay being received by Dr Verma prior to undertaking the training post. In Dr Verma’s case, this was £11,366. Unfortunately for the trust, it had, at the tribunal stage, made a pragmatic concession and agreed to protect Dr Verma’s pay on the basis of five practitioner shifts per week. The Court of Appeal was therefore unable to make a judgment at a lower level. Accordingly, it reinstated the employment tribunal’s original decision that the protected pay was £28,845, although it disagreed with its reasoning.

Implications

The Court of Appeal believed that the NHS’s pay-protection policy should extend only to levels of pay actually received, not levels that could hypothetically have been earned. However, the judges were divided and this case hinged very heavily on the precise wording of the clause, which was less than clear as to its application to part-time workers.

The key message here for employers is to ensure that any pay-protection policy is clear, accurate and tightly drafted. They should ensure that all classes of employees in their workforce are borne in mind when drafting such policies, and that atypical workers are expressly dealt with to avoid debate.

Guy Lamb, partner, DLA Piper

Practical guidance from XpertHR on pay issues

  • Equal pay policy Use this model policy to set out the company’s commitment to equal pay between male and female workers. It may be used to support an equal opportunities policy within the company’s staff handbook.
  • Pay harmony on single status at Newcastle City Council It has taken a decade for an equality-proofed pay and grading structure to be negotiated and implemented at Newcastle City Council, but both the employer and union are proud of it.
  • XpertHR job evaluation survey 2011: details of schemes Job evaluation can help to bring clarity and order to pay and grading structures and enables employers to compare pay rates against the external labour market – as well as offering some protection against equal pay claims – according to the latest XpertHR research.

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