The material factor must be genuine

An employer must be able to produce evidence to show that the explanation offered is the real reason for the difference.

If an employer argues that it was necessary to pay the comparator more because of a skill shortage, they must provide evidence of actual difficulties recruiting and retaining people to do the job being done by the higher paid man. The employer will also need to monitor the discrepancy to make sure it is still justified.

In Dolphin v Hartlepool Borough Council and Housing Hartlepool Ltd [2008] AER 73, bonus schemes purportedly designed to encourage productivity were attached to jobs that were predominantly carried out by men. A tribunal found that the bonus payments were in fact extra payments for completing work individuals were already paid to do and were a sham. As a result, the employer’s defence that the bonus payments were genuinely intended to encourage productivity failed.

In Bury Metropolitan Borough Council v Hamilton [2011] ICR 655, another claim for bonus payments made to male employees, the EAT went a step further, confirming that there is no need to go as far as to prove that a reason is a “sham” i.e. something deliberately fabricated to mislead. Instead, a finding by the tribunal that the bonus payments were not in fact linked to productivity as claimed by the employer was enough to show that the reason put forward to explain the pay difference was not genuine.