Asda loses landmark equal pay tribunal ruling

Asda

Asda has lost a landmark employment tribunal ruling involving thousands of workers in their supermarkets. This case, the biggest of its kind in the private sector, involves the claim that work done in the company’s retail stores was perceived as “women’s work” and was paid at a lower rate than the work in distribution depots (which was traditionally seen as “men’s work”). This decision means that more than 7000 workers can now proceed with equal-pay claims against the company. Asda had previously attempted to have the employment tribunal stay the proceedings indefinitely, meaning that claimants would have had to pursue their cases with the High Court. 

The claims could see workers recovering over £100 million dating back to 2002, and will likely serve as a stark reminder of the importance of accurate and fair salary banding in large organisations with varied staff roles. This case has important implications for other on-going equal pay claims, including one that is being brought on behalf of approximately 400 Sainsbury’s workers. 

It should be noted that whilst this case may involve a large employer and thousands of workers the core principle of equal pay for ‘like’ work is just as relevant to smaller businesses. But what does this mean?  

ACAS guidance states the following:

“Employers must pay men and women equally if they are doing 'like work', which is work that's the same or broadly similar; or work that's of equal value (for example, in terms of effort, skill or other demands); or work that's rated as equivalent under a job evaluation study.”

Whilst this provides some framework to base pay decisions on, it doesn’t go as far as to explain what might be considered equal effort/skill etc. This decision is left up to the employer, who is required to make a reasonable decision. Unfortunately, it is not always easy to place highly varied roles into defined ‘salary bands’ so if you are uncertain about your company’s pay rates then we’d recommend getting professional advice. 

To make matters more complicated, if an employer can show that there is a genuine reason for any difference in pay that is not based on the sex of the individual (or any other protected characteristic such as disability, race, religion, etc.) then the equal pay legislation may not apply. A common reason for variation in pay may be an individual’s experience or qualifications relevant to their role, however this won’t necessarily always make them exempt from this legislation. Employers must be able to show that the qualifications or experience truly enable the worker to perform their duties better – which in itself is another somewhat grey area…

RBHR have extensive experience of pay benchmarking both within an organisation (for equal pay purposes), and in comparison to competitors (to help you attract and retain the best talent), so if you require assistance with this or any other HR issues then please don’t hesitate to contact us on 01935 411191 or email admin@rebeccabevins.co.uk.