Equal Pay Claims – limitation extended to 6 years from termination of employment

The landmark ruling in Birmingham City Council –v- Abdulla and others has confirmed that equal pay claims that would usually be out of time if brought in the employment tribunal can proceed as a breach of contract in the High Court.   This will have ramifications for all employers.

Over 170 female employees of Birmingham City Council brought High Court claims against the Council for breach of the provisions of the Equal Pay Act 1970, as they were unable to issue these in the employment tribunal due to time limitations: in the employment tribunal claims must be brought no later than 6 months after the termination of employment.  Following an unsuccessful application by the Council to strike out the claims on the basis that they would be more conveniently disposed of by an employment tribunal, and two subsequent appeals, the Supreme Court has now ruled that time limits for bringing equal pay claims are to be extended from 6 months to 6 years.

The original application by the Council to strike out the claims was on the basis that the High Court was not the correct forum and the court should consider the employment tribunal to be the most appropriate to hear the claim. The strike out application was made after the 6 month time limit for bringing the equal pay claims in the employment tribunal had elapsed. The High Court held that it would not be consistent with the language of the legislation to regard a claim as more conveniently dealt with by an employment tribunal if it meant that the case would subsequently be struck out by the employment tribunal for being out of time.

The Council appealed to the Court of Appeal inviting the Court to strike out the claim unless the claimants could provide reasonable explanation for the failure to present the claim to the tribunal within the time limit. The appeal was rejected and the court noted that the EPA 1970 provides a discretion rather than an obligation to strike out equal pay claims when it could be dealt with in a more suitable forum i.e. a lower court or the tribunal.  If a court were to strike out a claim for the reason of it being dealt with more conveniently in the tribunal but the claim would be out of time in the tribunal, it would prevent the claim being heard at all.

The Council further appealed to the Supreme Court and the wording of the EPA 1970 was considered in detail. The Court noted that legislation requires the court to consider whether equal pay claims could be ‘more conveniently’ dealt with by an employment tribunal. The Court held that claims could never be considered to be more conveniently disposed of by an employment tribunal where they would be time barred.

The Court also went on to suggest that Parliament may wish to consider relaxing the employment tribunal time limitations in cases where a claim has been brought in time before the Court, and if it were not for the time limit, the case would be more conveniently disposed of by the employment tribunal. This recommendation also came with a warning that any deliberate delay in bringing proceedings to ensure that cases are dealt with by the court rather than the employment tribunal may be deemed to be an abuse of process and may result in the claim being struck out. In these circumstances the Court may also take into account whether they consider the claimant should have issued a claim in the employment tribunal (and could have done so within the time limit) when awarding costs.

This ruling, which has the effect of extending the time limitations on bringing equal pay claims is likely to have an effect not only on public sector employers but in companies throughout the UK and could potentially trigger thousands of claims. It is thought that the ruling is likely to have a big impact in the city where women receiving unequal pay have refrained from making a claim for fear of not being able to obtain future employment in the same sector.

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