Calmac Ferries Ltd v Wallace & Anor

Under the equal-terms provisions of the Equality Act 2010, a woman undertaking equal work who receives less favourable terms than a male comparator has a prima facie claim. The employer must first prove a genuine and material factor which caused the difference and was not sex-related.

Only once that factor is established does the claimant need to show group disadvantage for the purposes of section 69(2). A claimant’s statement that no direct-discrimination claim is advanced does not concede an employer’s asserted material factor unless that concession is clear. Where the alleged factor remains factually disputed, a strike-out is generally inappropriate.

Two female port assistants claimed equal pay with an outport clerk, a male comparator, whose work was conceded to be like work. The employer asserted that different historical roles, duties and collective-agreement arrangements provided a genuine material factor for the difference in pay.

The claimants stated that they did not advance a direct-discrimination claim, but they did not accept that the employer’s asserted factor was the true or material cause of the disparity. Employment Judge Kearns refused the employer’s application to strike out the claims, or to treat them as having little reasonable prospect of success, in reasons delivered on 22 January 2013.

The employer appealed. The central issue was whether the claimants had first to establish indirect discrimination under section 69(2), notwithstanding the unresolved factual dispute about the asserted material factor.

1. Appeal dismissed. The Employment Judge was entitled to refuse strike-out. The claimants had not conceded that the employer’s pleaded explanation was the real reason for the difference in pay, or that it was material. The employer’s revised pleading also made the factual basis of that explanation a live issue.

2. Sections 65 and 66 of the Equality Act 2010 create a prima facie presumption where a female claimant doing equal work receives less favourable terms than a male comparator. Under section 69(1), the employer must show a genuine and material factor which caused the difference and did not involve less favourable treatment because of sex.

3. Section 69(2) is engaged only if the employer establishes such a factor. The claimant must then show that the factor places women doing equal work at a particular disadvantage compared with men. It was therefore premature to require the claimants to establish that group disadvantage while the employer’s material-factor case remained disputed.

4. A material-factor defence is fact-sensitive. The statutory explanation must address the differential itself. It requires examination of why the claimant is paid as she is and, separately, why the comparator is paid as he is. Explaining only one side of the comparison is insufficient.

5. Discrimination claims involving a core factual dispute should not ordinarily be struck out. The Judge’s exercise of discretion, including her approach to a deposit order, disclosed no error of law.

The Tribunal also observed that references to direct and indirect discrimination should be tied closely to the statutory scheme. Those labels should not impede examination of apparently gender-disadvantaging differences in terms.

• Employment Appeal Tribunal: Calmac’s appeal was dismissed: [2013] UKEAT 0014_13_2210.

• Employment Tribunal: Employment Judge Kearns refused the employer’s strike-out application in reasons delivered on 22 January 2013. No citation for that decision was stated.