Are all things truly equal?

A very recent Tribunal decision on equal pay, sex discrimination and victimisation is a stark reminder that equal pay is a legal requirement. The facts are remarkable and so was the value of the judgement entered against BNP Paribas (just over £2M). So, what went wrong? The bank employed a female Global Product Development Manager in 2013. This was a fairly new discipline for the bank. Her interview process was not documented and there was just one endorsement made about her which was ‘too light’. Nevertheless, the job offer was made at a salary of £120k. Shortly after this, the bank recruited a male to the same role. The bank actively sought this candidate and considered that they would need to pay him well to entice him to join their new team. He was paid £160k. Their respective first year bonuses were £3.8k for her and £8.5k for him.

The difficulty for the bank was that there was in fact no distinction between the two roles (although different projects and locations were involved) and this overarching similarity was conceded by the bank and the male comparator. Time went on. In 2014 his basic pay increased to £177k but hers by just £5k. His bonus was £30k more than hers. The female claimant began to complain. Her direct line manager would dismiss her requests for information and routine professional assistance in their shared office, ‘Not now Stacey’ became a frequent refrain. A witch’s hat was left on her desk by her male colleagues after a boozy night out. She formally raised a grievance in 2017 and said she was being treated differently in relation to pay. This was dismissed on the basis that her male comparator’s role had ‘greater autonomy, scope of projects and regional responsibility’. Sadly, this was a sweeping generalisation which was unsupported by the evidence. The reality was that by this time the female employee’s relationship with her line manager was badly damaged. This was in contrast to her male comparator. By 2017 his bonus was £70k greater than hers which had remained static at £10k.

The bank persisted in its defence of this case and argued that the female claimant was in a different and junior position to her male comparator. The bank also argued that opaque pay scales and discretionary pay schemes were commonplace in the financial services sector. You will not be surprised to hear that the Tribunal rejected this. These were the same roles and deserved equal pay. More than that, for the first time the Tribunal ordered that the bank should produce an Equal pay Audit.

This applies to all employees including those who only worked part of the year, or who were off sick during that time. In respect of these employees, the audit must contain all of their monetary compensation including:

  • base pay
  • pension contributions, and
  • allowances and discretionary bonus payments

Once this data is compiled, the bank is also under a legal obligation to:

  • identify any differences in pay between men and women
  • explain the reasons for any identified difference
  • include the reasons for any potential breach of equal pay (ie where women have been paid less than men for no other reason other than sex, in breach of equal pay regulations) and
  • set out the plan to avoid breaches occurring or continuing

So, how to avoid this?

  1. Create accurate job descriptions for your advertised roles and for employees who are in post
  2. Interview candidates by reference to desirable and required skills
  3. Score interviews by reference to the demonstration of those skills
  4. Create a transparent system for grading and pay scales
  5. Apply rigorous and widely known criteria to determine discretionary bonus payments.

The information contained in the above article was correct at the time of publication. To ensure you are kept up to date with changes to employment law matters, click here to sign up to our dedicated employment database.

Learn more about Rebecca

All the articles above are written by our Partner & Head of Employment Rebecca Dennis. Rebecca’s professional background is unique in that she worked for more than 20 years as a barrister providing legal advice, drafting and advocacy for her clients and more recently provided specialist trouble-shooting services on employment law and employee relations at a leading international HR outsourcing company.

What Rebecca doesn’t know about Employment Law really isn’t worth knowing.

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