by Paula Määttä

XI. United Kingdom

B. Scope of the concepts on equal pay

1. The definition of "pay"

The Equal Pay Act applies to terms and conditions of employment, including pay. Terms and conditions of employment mean more than basic wages. They include benefits in kind, such as the use of a car, cash bonuses and sickness benefits. (McCrudden 1993, pp. 141-142.)

Terms and conditions of a man's and a woman's contract of employment are required to be equal if the woman is employed on like work, or work rated as equivalent or work of equal value in relation to work performed by a man. If any term of the woman's contract is less favourable than a corresponding term of a man's contract, the term in the woman's contract is to be treated as modified so as not to be less favourable. If a woman's contract does not include a term corresponding to a term in a man's contract that benefits the man, the woman's contract is to be treated as including such a term.

The Equal Pay Act does not apply to terms and conditions related to retirement or death. In 1990 the European Court of Justice (EJC) in the case of Barber v. Guardian Royal Exchange Group (1990) ICR 616 established that occupational pensions are "pay". It appears that all forms of occupational pension schemes are covered by Article 119 of the EC Treaty. This rule has still not been brought into force. (Commission of the European Communities 23.6.1994, p. 34.)

2. The definition of "equal work"

The Equal Pay Act defines the contents of "like work", "work rated as equivalent" and "work of equal value" in 1.

"Like work" means work that is of the same or of a broadly similar nature, and the differences (if any) between the things done by the woman and the things done by the man are not of practical importance in relation to terms and conditions of employment.

"Work rated as equivalent" with that done by a man is work where the woman's job and the man's job have been given an equal value, in terms of the demand made on a worker under various headings (for instance effort, skill, decision), on a study undertaken with a view to evaluating in those terms the jobs to be done by all or any of the employees in an undertaking or group of undertakings, or would have been given an equal value but for the evaluation being made on a system setting different values for men and women on the same demand under any heading.

A woman may also claim to be doing work of equal value as that of a man. She may then invoke a statutory process that requires a job evaluation exercise to be carried out to ensure that her job and the job being compared with her job are evaluated in terms of the demands made on her. Provision for such evaluations in relation to work of equal value was introduced by way of an amendment to the Equal Pay Act ( 1(2)(c)) after the European Court of Justice had held that the United Kingdom was in breach of the Equal Pay Directive (Commission of the European Communities v United Kingdom (1982) IRLR 333 (ECJ)).

3. Scope of the equal pay provisions

The Equal Pay Act covers both the public sector and the private sector. The armed forces are excluded from the coverage of the Act. Section 7(1) of the Act provides that neither the Secretary of State nor the Defence Council shall make or recommend the making of "any instrument relating to the terms and conditions of service of members of the naval, military or air forces of the Crown, if the instrument has the effect of making a distinction, regarding pay, allowances or leave, between men and women who are members of those forces, not being a distinction fairly attributable to differences between the obligations undertaken by men and those undertaken by women".

The Equal Pay Act covers the terms of contracts under which a woman is employed at an establishment in Great Britain. There is no requirement that an establishment must be of any particular size before it is covered by the legislation.

Homeworkers, part-time workers and casual workers are covered by the Act. The position with regard to homeworkers is further clarified by a specific provision in the Act that states: "where work is not done at an establishment it shall be treated for the relevant purposes as done at the establishment from which it is done or (where it is not done from any establishment) at the establishment with which it has the closest connection".

The Act does not operate in relation to contractual terms relating to retirement or death, nor does it operate in relation to terms which afford special treatment to women in connection with pregnancy or childbirth.