Indirect discrimination — the genuine material factor defence

Sometimes the employer’s reason for paying more is indirectly discriminatory. For example, different pay rates based on length of service may discriminate against women because time off for childcare means it takes longer to accumulate the same amount of continuous service, or shift premium payments reward anti-social hours, better suited to most men than to women with caring responsibilities.

Employers are allowed to justify indirect discrimination where they can show it is a proportionate means of achieving a legitimate aim, for example, attracting people to work in difficult locations or over awkward hours, to make sure there are enough workers to cover nightshifts and weekends.

In Chief Constable of West Midlands Police v Blackburn & Manley ([2008] EWCA Civ 1208), two WPCs with childcare responsibilities complained that a shift bonus scheme for officers who worked at least four hours at night indirectly discriminated against them. The EAT disagreed and found that the payment of the bonus was to reward those who worked night shifts. It was a legitimate aim, unrelated to discrimination based on sex. The tribunal should have concluded that it was justified.

In Haq v the Audit Commission ([2012] EWCA Civ 1621), a policy of pay protection following a reorganisation enabled senior male employees to keep their place on the pay scale despite an enforced move to a lower skilled role. This meant that the male employees were paid more — sometimes £10,000 a year more — than their female counterparts in the lower skilled role, for doing the same job.

The Court of Appeal confirmed that the combination of the pay protection and the reorganisation in this case was indirectly discriminatory against the women, but that the employer’s wish to retain skilled staff and to protect their pay were capable of being legitimate aims.

Women transferred to alternative work for health reasons during pregnancy cannot pursue an equal pay claim for that alternative work. Similarly, men cannot claim equality in respect of any additional lump sum or loyalty bonuses paid to women on maternity leave (Abdoulaye v Renault [1999] IRLR 811).