Young v National Power Plc

For the six-month limit on an equal-pay claim, employment means the contract of employment, whereas work means the job performed. The period under section 2(4) therefore runs from termination of the contract, not from the claimant’s last day doing the particular work relied upon. A change of duties within one continuing contract does not start a new limitation period unless a new contract is found. Definitions in section 1(6) assist construction of section 2. Subsequent reduction of protection against historic arrears does not alter section 2(4). Claims seeking very old declaratory relief may, in an appropriate case, be struck out as an abuse of process.

Mrs Nanette Young was employed by National Power Plc from 1969 until her redundancy on 31 October 1996. She claimed equal pay under the Equal Pay Act 1970, comparing her work as a value-for-money analyst with that of two male employees. The Employment Tribunal held that her application, presented on 24 April 1997, was out of time because she had stopped doing that work on 30 May 1995.

The Employment Appeal Tribunal held that the six-month period ran from termination of her employment, not cessation of the particular work, and declared that the Employment Tribunal had jurisdiction. National Power appealed, arguing that “employment” meant the particular job relied upon and relying on Preston and others v Wolverhampton Healthcare Trust and others [1998] ICR 227. The central issue was the proper construction of section 2(4).

Disposition. The Court of Appeal unanimously dismissed the appeal. The case was remitted, as directed by the Employment Appeal Tribunal, to a differently constituted Employment Tribunal.

1. Construction of section 2(4). On its ordinary meaning, section 2(4) of the Equal Pay Act 1970 requires an application to be lodged within six months of termination of the claimant’s employment. The definitions in section 1(6) apply to section 2 as well as section 1. “Employed in the employment” therefore means employed under a contract of service.
2. Employment and work. The Act distinguishes between employment and work. Employment refers to the contractual relationship; work refers to the actual job performed. A claimant must separately establish the relevant comparison of work and that the claimant and comparator were in the same employment. They may be doing different jobs while remaining in the same employment.
3. Application to the facts. The Employment Tribunal had found no new contract when Mrs Young’s duties changed. The contractual arrangements contemplated movement between suitable duties within her grade. She therefore remained employed under one contract until 31 October 1996, and her application was within six months of its termination. Preston supported the contractual interpretation but was not applicable on its facts because it concerned successive discrete contracts.
4. Additional observations. The court declined to decide the separate submission that an equality clause continued to modify contractual terms after the work changed. It also treated policy and “common sense” arguments as subordinate to the statutory words. Obiter, sections 2(4) and 2(5) together provided a balance between stale claims and the employee’s freedom from having to sue during employment. The fact that the two-year arrears limit had been declared too short did not change section 2(4). The court considered that a very old claim for declaratory relief would usually be vulnerable as an abuse of process.

The recorded order dismissed the appeal and directed that costs be paid by the respondents.

• Court of Appeal: dismissed National Power Plc’s appeal and remitted the case to a differently constituted Employment Tribunal.
• Employment Appeal Tribunal: reversed the Employment Tribunal’s preliminary ruling and declared that it had jurisdiction because the claim was presented within six months of termination of the employment contract.
• Employment Tribunal: held that the claim was out of time under section 2(4) because the claimant had stopped doing the particular work relied upon more than six months before presentation, and struck out the claim.