Local Government - June 2009

The long awaited Equality Bill has finally been published and is now on its way through the various stages of the Parliamentary process. The Bill has already attracted substantial publicity and received both applause and derision.

One of the main purposes of the Bill is to harmonise existing discrimination legislation and bring the various strands of discrimination under one head. The Bill also proposes to amend and strengthen certain discrimination laws including in relation to employment law. We highlight below the main areas of proposed amendment.

Equal Pay issues

There are 3 principal proposed amendments to Equal Pay legislation, one of which is almost certain to survive the parliamentary process and the others less so.

1.      Secrecy clauses.  Clause 72 of the Bill proposes that clauses in employment contracts which seek to prevent employees from discussing pay with colleagues in order to establish whether there is a difference in pay will be unenforceable.

2.      Objective justification. There is currently a defence to an equal pay claim of objective justification. Most local authorities have now implemented new pay structures which are designed to eliminate past inequalities in pay.  In doing so, a number of authorities agreed to protect the pay of the employees who are losing out in the new structures. These pay protection periods have typically been for a couple of years or so.  The Bill proposes that a long term objective justification of eliminating inequality in pay would always be regarded as a legitimate aim.

3.      Publication of information about pay differences.  There is a proposal to require private sector employers with more than 250 employees, to publish information about differences in pay between their male and female employees.

Discrimination by Association

The Bill proposes a very wide definition of direct discrimination to apply to all strands of discrimination (called “protected characteristics”): “A person (A) discriminates against another (“B”) if because of a protected characteristic, A treats B less favourably than he treats or would treat others.”  

This definition is wide enough to include discrimination against one person because of their association with another person who has a protected characteristic. So, for example, a person is discriminated against by their employer because their spouse is disabled.

Positive Action 

It is proposed that employers will be allowed, when choosing between two equally qualified candidates, to select a candidate who has a protected characteristic, from an under represented or disadvantaged group. So for example, where women are under represented in a firm of solicitors then an employer may choose to recruit a woman who was equally qualified for the role as male candidates. The employer would not, however, be permitted to recruit a woman in these circumstances who was less well qualified to carry out the role than a male candidate.  It is difficult to know what impact this proposed change will have.  Where a role is one for which skills, qualifications and experience all count, then it is unlikely that an employer will reach a position of two equally well qualified candidates. Where a role is a junior or fairly unskilled role then the circumstance is more likely to arise.

Equality duties - Public Authorities

Part 11 of the Bill sets out provisions which impose duties on Public Authorities, when carrying out their functions to have due regard to the need to eliminate unlawful discrimination and also “to advance equality of opportunity” and to “foster good relations” between people who have a protected characteristic and those who do not have that same protected characteristic.

Existing legislation imposes these duties in relation to age sex and race but the Bill proposes to extend the duty to all strands of discrimination.

The Bill makes clear that this duty may involve treating some persons more favourably than others although emphasises that this does not mean permitting conduct that would otherwise be prohibited under the Act.  However, the obligation that this clause intends to impose on Public Authorities does mean that the Positive Duty noted above will have to be considered vary carefully by Public Authorities. Part 11 will effectively make the option of Positive Action an obligation on Public Authorities in their recruitment.  

Equality duties – Private Sector

Whilst equivalent duties will not be imposed on private and voluntary sector organisations, the expectation is that a Public Authority, when exercising its procurement function, will take into account its Equality Duty.

It does seem inevitable, therefore, that those private sector organisations that wish to contract with public authorities will need to ensure that their record, particularly in relation to equality of opportunity and pay, are good. There is an expectation that the spending power of the public sector will be used to assist in ensuring greater compliance with anti discrimination legislation and better and wider understanding and promotion of equality and diversity, particularly in employment. 

Age discrimination – no abolition of statutory retirement age

The Bill does not contain proposals to remove the statutory retirement age of 65 and it is clear that a number of organisations are disappointed with this.  This means that employers will still be able to require their employees to retire when they reach the statutory retirement age of 65 or above and, in doing so (assuming the correct procedure is followed) not risk claims of unfair dismissal or age discrimination. 

The “Heyday” case is continuing to challenge the legality of the statutory default retirement age of 65 and the parties in that case are awaiting a hearing date in the High Court, which should be later this year. Of course, if the case succeeds then the Government may well amend the Bill to abolish the default retirement age.

Mark Leach is a Partner in the Manchester team, mark.leach@weightmans.com.