Case of the week: Council of the City of Sunderland v Brennan and others

Council of the City of Sunderland v Brennan and others

FACTS

Female employees at Sunderland City Council brought equal pay claims relating to bonus arrangements. Historically, jobs attracting the bonus payments had typically been done by men and jobs not attracting the payments had typically been done by women.

From 1997 until 2007, local authorities were obliged to implement the “single status” agreement to standardise arrangements for determining terms and conditions. Once a local authority achieved single status, the bonus schemes were withdrawn. However, some employees who had benefited from the bonuses became covered by pay protection schemes enabling them to continue to receive bonuses for a period of time.

The claimants fell into five groups: caterers, cleaners, carers, school support staff and leisure centre attendants. The comparators were gardeners, road sweepers, drivers and refuse collectors. The claimants brought equal pay claims in respect of the period before implementation of single status and the period during which predominantly male groups of employees benefited from pay protection.

The tribunal dealt first with the period before single status and considered whether or not the non-payment of bonuses was genuinely due to a material factor other than the difference of sex (the genuine material factor defence).

DECISION

The tribunal held that the genuine material factor defence failed, except in respect of the leisure centre attendants. The Employment Appeal Tribunal (EAT) dismissed the council’s appeal and the council appealed to the Court of Appeal.

The main issue before the Court of Appeal was a challenge to the employment tribunal’s finding that the bonus schemes had long since ceased to have anything to do with productivity. The council maintained that the productivity link was unbroken throughout the years covered by the claims.

The Court of Appeal rejected this argument. It said that the employment tribunal’s findings regarding the absence of occasions on which the bonus was withheld; the fact the ultimate withdrawal of the bonus had no impact on productivity; and the absence of remeasurements were permissible findings in the light of the evidence. It allowed the tribunal to infer that the bonus systems had long since ceased to relate to productivity.

The Court of Appeal also rejected the council’s submission that the EAT had failed to address the question of whether or not there was a non-discriminatory reason for the pay differentials after it overturned the tribunal’s finding that the bonus schemes were a sham.

The Court of Appeal found that the tribunal had already decided on the facts before it that the productivity link had ceased to exist, and the council’s evidence was that this link was the explanation or reason for the differential in pay. This meant that there had to be indirect discrimination. This left the final question of whether or not that discrimination could be objectively justified, which the EAT had addressed.

IMPLICATIONS

The case does not raise any new points of law but does bring an end to the claims by this group of female employees in relation to non-payment of bonuses from 1997 until 2004. However, the pay protection claims remain to be resolved.

Sandra Wallace, DLA Piper