Equal Pay: Asda retail store employees can compare themselves to distribution depot employees

Equal Pay: Asda retail store employees

The Asda equal pay case could have wide implications for employers in the retail sector and will alert other employers to the fact that even where there are considerable differences between the working arrangements of two groups of employees.

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The Asda equal pay case could have wide implications for employers in the retail sector and will alert other employers to the fact that even where there are considerable differences between the working arrangements of two groups of employees, there may still be enough to enable one group to use the group as a comparator for the purposes of an equal pay claim. 

Brierley and others v Asda Stores Ltd started in 2008 and has received much attention in the press, especially since it has been reported that the value of the claim is £100m. The claimants, Asda retail store staff who work in Asda's multitude of supermarkets, and who are predominantly female, are paid on average between £1 and £4 less per hour than Asda distribution depot employees, who are predominantly male. Retail staff and distribution staff work in different locations.

The Claimant store workers say that retail store work is incorrectly viewed by Asda as being work traditionally carried out by women and, as a result, is perceived as being less valuable than the work performed by their mostly male counterparts in the distribution depots. They say that the work should be valued the same, asserting that Asda pays them less because they are women.

The principle that women and men should receive equal pay for equal work is enshrined in the Equality Act 2010. There are three categories of equal work:

  • Work of equal value (including in terms of effort, skill or decision making);
  • Work rated as equivalent (under a job evaluation study); and
  • Like work (work that is broadly similar or is the same).

In this case, the claimants argue that their work is of equal value to that carried out by male distribution depot employees. In order to get the green light to proceed to the next stage of their equal pay claim, the claimants needed to show that the male employees in Asda's distribution depots were valid "comparators" for equal pay purposes and that they were in the "same employment". Because the claimants work at different locations to their male colleagues in Asda's distribution depots, they needed to show that:

  • "common terms" applied to both groups; and/or
  • their terms and conditions were attributable to a single source or body responsible for the alleged inequality in pay which was capable of restoring equal pay treatment.

The Employment Judge held that it should proceed to the next stage of the tribunal process and that female retail store employees could compare themselves to male distribution depot employees. The Employment Judge held that:

  • Broadly, there were common terms between the claimants and their male comparators and a significant correlation or comparison between the terms in retail and distribution. Although there were some differences between the terms of employment of the claimants and male distribution depot employees, these were not so extensive as to undermine the broad comparison.
  • In considering whether there was a single source or a body responsible for the alleged inequality in pay between the female retail and male depot employees, the Employment Judge held that Asda's executive board was a single body responsible for budgetary control and oversight over distribution and retail staff, was responsible for the differences in pay and could have introduced equality.

As a result, Asda's retail store employees have established that they have a valid male comparator and so their case can proceed. However, the claimants still have numerous hoops to jump through before their equal pay claim is successful. Even if they can show that their work is of equal value to their male comparators, Asda will likely argue that sex is not the reason for the pay difference and that its actions are justified.

Reports suggest that Asda will appeal the Tribunal decision. Whilst the impact of this decision should not be underestimated, the likely impact on employers is unclear. Employers will better understand the impact once the Tribunal considers the issue of whether the retail store workers' work is of equal value to that performed by distribution depot employees. This claim still has come way to go before the final outcome is known.

For further information, or if you would like to discuss this topic, please contact your usual KPMG contact or email employersclub@kpmg.co.uk.

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