Birmingham landmarks up for sale to settle equal pay claims

2014-01-27 Jennifer Renney posted:

Thousands of women who brought a claim against Birmingham City Council, because they were paid less than men who did equivalent jobs, have been awarded compensation ranging from £2,000 to as much as £100,000.

Birmingham City Council and the joint trade unions reached an agreement at the end of 2013 to settle the equal pay claims which has meant that the council has had to borrow over £500 million to meet the costs. However, there is still a £550 million shortfall and the Department of Communities and Local Government has refused to permit further borrowing. As a result, it is reported that Birmingham landmarks, including the National Exhibition Centre (the NEC), might have to be sold off.

Despite the difficulty employees face in enforcing equal pay law, and the fact that the vast majority of claims are brought in the public sector, there are a number of reasons why private sector employers should not be complacent about any gender pay gap.

From the perspective of an employer, the most comprehensive way of addressing pay inequalities is through a job evaluation study or job evaluation scheme (JES). A JES is an analytical procedure for ranking jobs in a non-discriminatory way. They will then be grouped into salary bands and all jobs within a particular band will be "rated as equivalent" for the purposes of the Equality Act 2010 and should therefore be paid on the same scale.

The advantage of a JES over a less analytical review is that employees will normally be precluded from bringing an "equal value" claim based on jobs that are not rated as equivalent. This therefore provides the employer with a measure of protection against future equal pay claims.

Employers who do not wish to implement a formal JES can nevertheless carry out an equal pay review or "audit" to discover (and put right) any gender-based pay inequalities within the organisation. The danger for any employer of carrying out a review of its pay systems is that, once inequalities have been identified, there is a risk that employees will find it easier to bring equal value claims for back pay.

It is generally acknowledged that more could be done to address the gender gap. It is important for female employees to know whether they are being paid fairly compared to their male employees. Employers should also be mindful that they are not discriminating against workers on the basis of their sex. Birmingham City Council for example could have avoided a £1billion bill by paying their female workers fairly at the time. Make sure your business does not suffer the same difficulties.

For further information about equal pay, contact Ms Renney today at Renney and Co Employment Solicitors on 01225 632240 or at jennifer@renneyandco.com

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