Monday 5 December 2011

Equal Pay: Material Factor Defence

[Thanks to Jonathan Moffatt of Outer Temple Chambers for preparing this case summary]

If the explanation for a pay differential between employees had nothing to do with sex at the time of their recruitment, can that explain the continuing differential in subsequent years to satisfy the material factor defence under section 1(3) of the Equal Pay Act 1970? Yes, according to the EAT (Underhill P) in Secretary of State for Justice v Bowling.

C and her comparator were recruited on like work at about the same time. The latter was placed two points above C on an incremental scale because of his background and experience. By the time of the next pay review C had matched the performance of her comparator. The tribunal found that the original reasons for the differential ceased to be a material factor.

The EAT disagreed. The "catching up" might have undermined the justification for the differential, but it did not undermine its causative effect. The labelling of the explanation as "historical" was not helpful. The real question was whether a cause ceased to operate as an explanation for the differential at the date under consideration. The explanation in this case was not time-limited.

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