Employees given up to six years to bring equal pay claims

Posted by Mike Wilson on
Every contract of employment has an "equality clause" inserted into it. A recent case involving Birmingham City Council saw the Supreme Court confirm that equal pay claims may be brought in the civil courts, even if the six month time limit in the Employment Tribunal has expired.

In effect, this extends considerably the time within which an employee can issue an equal pay claim. If making a claim in the Employment Tribunal, it is free with no costs consequences and compensation is limited to £25,000.But the Claimant has only six months from their last day of employment to make a claim.

Alternatively they can issue in the civil courts, having six years to do so from the date of the alleged breach of contract.

There are court fees to pay, it will take longer and the losing party may have to pay the costs of the winning party. But there is no compensation limit.

In this case, Birmingham City Council argued that equal pay claims brought against it in the High Court should have been referred back to the Employment Tribunal (despite the claims being outside the applicable time limits) as it is regarded as the expert forum for dealing with equal pay.

The Supreme Court disagreed.

What this means for social landlords

Employers must now be mindful that equal pay claims can still be brought many years after the event.

A successful award could also include arrears of pay for up to six years. With the ongoing emphasis on greater transparency in gender pay, and future mandatory equal pay audits for employers that lose equal pay claims, all organisations must review their pay practices to ensure they are not caught out.

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Mike specialises in all aspects of employment law, including restrictive covenants, commercial agents regulations and disqualification of directors.

Mike Wilson
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