Reading Borough Council v James

The implied sex equality clause crystallises as soon as the statutory conditions are met and remains part of the contract until lawfully varied or terminated. The departure or promotion of the chosen individual comparator does not undo an accrued contractual right. A claimant may select an actual comparator; the presence of other potential comparators does not operate as a statutory modification to withdraw rights already crystallised. Employers may rebut or alter such rights only by lawful variation, termination or by proving a material factor defence.

The appeal arose from claims under the Equal Pay Act 1970 (and analogous provisions in the Equality Act 2010) by a group of female highways operatives. Following a stage 3 equal value hearing, the Employment Tribunal found that the women performed work of equal value to two named male comparators, Mr Coleman and Mr Peever, and awarded arrears back to 2002. Mr Coleman was promoted on 6 April 2006. Mr Peever's pay was assimilated to a Single Status Scheme on 1 May 2011. The employer appealed, arguing that the comparator's subsequent departure or pay change prevented comparison for later periods. The central question was whether an equality clause, once it has operated to modify a woman's contract, continues despite the comparator leaving or having his terms changed.

1. Outcome: Appeal dismissed. The Employment Appeal Tribunal upheld the Employment Tribunal's approach and reasoning.
2. The Equal Pay Act 1970 operates by implying an equality clause into the woman's contract once the conditions in s.1(2)(c) are satisfied. That implied modification takes effect automatically when the statutory conditions are met and creates an accrued contractual right (see Hartlepool Borough Council v Llewellyn discussed at [30]; [33]).
3. The fact that a named comparator later leaves, is promoted, or has his pay reduced does not, of itself, negate a contractual right which has already crystallised. The equality clause continues to operate until the woman's contract is validly varied or terminated or a material factor defence is proved (consistent with Sorbie v Trust House Forte Hotels Ltd and Sodexo Ltd v Gutridge).
4. A claimant must rely on an actual individual comparator when establishing the right. The claimant may select the comparator and is not required to choose a comparator representative of a wider group. The availability of other comparators in post does not amount to a statutory modification that withdraws rights already accrued.
5. The employer's alternative argument would produce anomalous and fluctuating pay rights. That outcome is contrary to the statutory design and to European authority allowing comparison with predecessors (see Macarthys Ltd v Smith). Practical difficulties in quantification do not defeat a crystallised contractual right.
6. Practical consequences: once equality has been established, the claimant need not continue to refer to the original comparator to enforce the accrued contractual right. Employers wishing to avoid accrual must lawfully vary contracts, rely on a valid material factor defence, or implement changes by lawful agreement or collective bargaining.
7. Order: Appeal dismissed; the Tribunal's award of arrears assessed by reference to the frozen comparator rates was upheld.

1. Employment Appeal Tribunal: appeal from the Employment Tribunal; judgment delivered 7 June 2018; appeal dismissed.
2. Employment Tribunal: stage 3 equal value hearing; judgment promulgated 15 July 2017; awarded arrears to claimants by reference to named comparators.