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Asda Equal Pay

Can Asda’s retail employees compare themselves to distribution employees?

The Supreme Court judgment in the Asda case confirms that retail employees can compare themselves to distribution employees for the purposes of equal pay claims

In Asda Stores Ltd v Brierley the Supreme Court upheld the decisions of the tribunal, the EAT, and the Court of Appeal that a group of mainly female retail employees could compare themselves to predominantly male distribution employees in order to claim equal pay. To bring an equal pay claim, a claimant must identify a comparator of the opposite sex performing equal work. This comparator must be actual and not hypothetical, and be employed by the same (or an associated) employer. If the comparator works at another establishment, the claimant needs to show that common terms apply at both establishments.

“Common terms” has been interpreted by the courts in a number of cases. Common terms do not have to be identical, only broadly similar. Importantly for the retail workers in the Asda case, the terms do not need to be common between the claimants and their comparators; instead, there must be common terms between the male comparators at their current establishment, and those which would apply if they were employed to do the same job but at the claimants’ establishment (even if there is no-one doing that type of work at that location). This is known as the North hypothetical.

On the facts, the Supreme Court considered the North hypothetical and found that the distribution workers would have been employed on the same terms if they had been employed at a retail location. It held that it did not matter that, in reality, it would not be feasible for the distribution employees to carry out their role at the retail location; for the purposes of the hypothetical, a depot could be envisioned next to the retail store.

The key takeaway for employers is that employees can compare their terms to those of other employees at different locations, even if they work in different roles, for the purposes of equal pay claims.  This will make it much easier for claimants to satisfy the threshold “common terms” test in order to pursue their claim.

However this does not make equal pay claims more likely to succeed, it just means that arguments in a Tribunal are likely to centre on other key elements of the claim including whether the roles perform work of equal value and whether there is a non-discriminatory material factor that explains the difference in pay.