Glasgow City Council+city Parking (glasgow) Llp+cordia (services) Llp V. Unison Claimants+fox Cross Claimants
| Jurisdiction | Scotland |
| Judge | Lord Philip,Lord Brodie,Lord Drummond Young |
| Judgment Date | 21 March 2014 |
| Neutral Citation | [2014] CSIH 27 |
| Court | Court of Session |
| Date | 21 March 2014 |
| Published date | 21 March 2014 |
| Docket Number | XA39/13 |
| EXTRA DIVISION, INNER HOUSE, COURT OF SESSION | |
| [2014] CSIH 27 | |
| Lord Brodie Lord Drummond Young Lord Phillip | XA39/13 OPINION OF THE COURT delivered by LORD BRODIE in the Appeal to the Court of Session under Section 37(1) of the Employment Tribunal Act 1996 by (1) GLASGOW CITY COUNCIL (2) CITY PARKING (GLASGOW) LLP (3) CORDIA (SERVICES) LLP Appellants; against (1) UNISON CLAIMANTS (2) FOX CROSS CLAIMANTS Respondents: _______________ |
Appellant: Truscott QC, Simpson & Marwick
Respondent: Jonathan Mitchell QC, Casey; (Fox Cross), Balfour + Manson LLP; Summers QC (Unison), Thompsons Solicitors
21 March 2014
Introduction
[1] This is an appeal from an order and oral judgment of the Employment Appeal Tribunal, as constituted by Langstaff J (President), Miss J Gaskell and Mrs Hibberd ("the Appeal Tribunal") dated 25 January 2013, allowing appeals from the judgment of an employment tribunal, as constituted by Employment Judge Frances Eccles, Mr W Stewart and Mr K Thomson ("the tribunal") sitting in Glasgow, dated 16 December 2011, as corrected in terms of certificate by the employment judge dated 16 January 2012. Leave to appeal to this court was granted by the Appeal Tribunal in terms of section 37 (1) of the Employment Tribunal Act 1996.
[2] As the Appeal Tribunal observed at the beginning of its judgment, the case is about sex discrimination and pay.
[3] The now appellants are Glasgow City Council ("Glasgow") and two limited liability partnerships ("LLPs"), City Parking (Glasgow) LLP ("Parking") and Cordia (Services) LLP ("Cordia"). Parking and Cordia were established to carry out functions which were formerly carried out by Glasgow directly. Parking carries out the car parking and parking fine enforcement services formerly carried out by Glasgow's department of Land and Environmental Services. It began trading on 1 June 2007. Cordia carries out most of the direct care services (home care, cleaning, janitorial, catering and related services) formerly carried out by Glasgow's department of Direct and Care Services. It has done so from 1 April 2009. Parking and Cordia are known as arm's length external organisations ("ALEOs"). Employees of Glasgow who had been employed to carry out the various functions were transferred incrementally to Parking and Cordia on transfer of responsibility for the functions from Glasgow to the two LLPs. All three appellants were respondents before the Appeal Tribunal and respondents in respect of claims made against them before the tribunal, by the now respondents. A further party, Culture and Sport Glasgow, a company limited by guarantee with charitable status and trading as Glasgow Life ("Life") was a respondent before the tribunal. The tribunal's determination insofar as it related to Life was not appealed to the Appeal Tribunal and accordingly Life did not participate in the proceedings before the Appeal Tribunal or before this court.
[4] The now respondents are employees of either Parking or Cordia who brought claims before the tribunal including a claim for equal pay under the Equal Pay Act 1970 and article 157 of the Treaty on the Functioning of the European Union ("TFEU"), against Glasgow and either Parking or Cordia. They are grouped as, first, the Fox Cross claimants, and, second, the Unison backed claimants, by reference to, in one case, the firm of solicitors and, in the other, the trade union, putting forward or otherwise supporting their claims. A further group of claimants, the GMB backed claimants, were represented before the tribunal and the Appeal Tribunal. The GMB backed claimants lodged answers to the present appeal but on 20 June 2013 these were allowed to be withdrawn and the GMB backed claimants have not participated further in the proceedings.
[5] In very short compass, the issue between the parties which is the subject of this appeal is whether, as the now respondents contend and as the appellants dispute, the now respondents should be permitted to compare their pay with that of men still working for Glasgow. The respondents' contentions depend on the proposition that Glasgow, Parking and Cordia are associated employers in terms of the 1970 Act and/or the proposition that Glasgow is the "single source" of the allegedly discriminatory differences in pay for the purposes of article 157 of TFEU. On its construction of the 1970 Act the tribunal held that Glasgow, Parking and Cordia were not associated employers. It held that Glasgow was not the body responsible for any differences in pay and not therefore a "single source". The Appeal Tribunal, reversing the tribunal, held that Glasgow, Parking and Cordia were associated employers and that therefore the respondents could compare their pay with that of men still working for Glasgow. It was therefore unnecessary for the Appeal Tribunal to determine whether Glasgow was a "single source". However, in deference to the argument it had heard, the Appeal Tribunal indicated that had it been necessary to decide the question of single source, it would have held that the tribunal had been in error by having failed to deal with, or to find relevant facts on the matter and, separately to deal with a significant argument, and therefore the Appeal Tribunal would have remitted the case to the same tribunal for re-determination.
Equal pay
[6] In effect, employees have the right not to be discriminated against on the basis of sex in the matter of pay. Article 157 (1) of TFEU (formerly article 141(1) of the Treaty Establishing the European Community) is in these terms:
"Each Member State shall ensure that the principle of equal pay for male and female workers for equal work or work of equal value is applied."
By virtue of Council Directive 75/117 (the Equal Pay Directive) the principle of equal pay means:
"For the same work or for work to which equal value is attributed, the elimination of all discrimination on grounds of sex with regard to all aspects and conditions of remuneration."
[7] In domestic legislation the principle of equal pay is now intended to be ensured by the Equality Act 2010. Formerly the relevant provision was the Equal Pay Act 1970, as amended. The 1970 Act is now repealed but there are transitional provisions and the 1970 Act continues to govern claims, such as those in the present case, which were brought before the 2010 Act came into force.
[8] Put shortly, section 1(1) of the 1970 Act provided that each contract of employment was deemed to include an equality clause, as that was defined by section 1(2).
[9] For the equality clause to operate in favour of a woman employee she must be employed on like work or work rated as equivalent to that of a man or work of equal value to a man who is "in the same employment". Clearly being in the same employment includes a situation where the woman and the man chosen as a comparator are both employed by the same employer and both work in the same establishment. However, in terms of section 1(6) of the 1970 Act, men shall also:
"... be treated as in the same employment with a woman if they are men employed by her employer or any associated employer at the same establishment or at establishments in Great Britain which include that one and at which common terms and conditions of employment are observed either generally or for employees of the relevant classes."
Paragraph (c) of section 1 (6) gave the meaning of "associated employer":
"(c) two employers are to be treated as associated if one is a company of which the other (directly or indirectly) has control or if both are companies of which a third person (directly or indirectly) has control..."
[10] The now respondents rely on article 157 (1) of TFEU as well as the 1970 Act.
[11] In Lawrence v Regent Office Care Ltd Case C-320/00 [2003] ICR 1092, the Court of Appeal made a reference to the Court of Justice of the question whether in the circumstances of that case, article 119 of the EC Treaty, subsequently article 141 EC (the predecessor of article 157 of TFEU) was directly applicable, so that it could be relied on by the applicants in the national proceedings to compare their pay with that of men working in the employment of a local authority. The applicants were school catering and cleaning staff who had been transferred from the employment of the local authority to an entirely separate commercial company after a process of compulsory competitive tendering. The Court of Justice answered the referred question in the negative on the facts of the case before it, but it did so in terms which indicated that article 141 might be relied on where allegedly discriminatory differences in pay could be attributed to "a single source". Paragraphs 17 to 19 of the Court's judgment were in the following terms:
"17. There is, in this connection, nothing in the wording of article 141(1) EC to suggest that the applicability of that provision is limited to situations in which men and women work for the same employer. The court has held that the principle established by that article may be invoked before national courts in particular in cases of discrimination arising directly from legislative provisions or collective labour agreements, as well as in cases in which work is carried out in the same establishment or service, whether private or public: see, inter alia, Defrenne [1976] ICR 547, 568, para 40; Macarthys Ltd v Smith (Case 129/79) [1980] ICR 672, 690, para 10, and Jenkins v Kingsgater (Clothing Productions) Ltd (Case 96/80) [1981] ICR 592, 613-614, para 17.
18. However, where, as in the main proceedings here, the differences identified in the pay conditions of workers performing equal work or work of equal value cannot be attributed to a single source, there is no body which is responsible for the inequality and which could restore equal treatment. Such a situation does not come within the scope of article 141(1) EC. The work and the pay of those workers cannot therefore be compared on the basis...
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