EAST AYRSHIRE COUNCIL
CABINET – 22 APRIL 2015
EQUAL PAY CLAIMS – UPDATE REPORT AS AT 1 APRIL 2015
Report by Acting Depute Chief Executive (Safer Communities)
PURPOSE
1.
The purpose of this report is to provide an update on the current position relating to
equal pay claims lodged by employees of the Council at the Employment Tribunal.
BACKGROUND
2.
Under the Equality Act 2010 (which replaced the provisions of the now repealed Equal
Pay Act 1970) it is a legal requirement that men and women are given equal treatment
in their terms and conditions of employment, including pay, where they are employed
to do like work, work which is rated as equivalent under a Job Evaluation Scheme or
work which is of equal value.
3.
During 2006, as there might have been historically inadvertent inequalities existing in
the Council’s current pay arrangements at that time, the Council made equal pay
compensation payments to relevant employees. Other Councils in Scotland also made
similar equal pay compensation payments to their affected employees.
4.
The offer was made without any admission of liability or admission that pay inequalities
exist or had existed. The Council had set aside a substantial financial package to make
relevant net payments to the employees concerned.
5.
Employees who were employed on former Manual Workers conditions of service as a
Cleaner, Catering Assistant, Catering Manager, Cooks, Assistant Cook, Personal
Carer, Personal Carer/Escort or Home Help were offered and received a compensation
payment based on their pay grade, weekly hours and length of continuous service up
to a maximum of five years.
6.
Since those compensation payments were made a number of other equal pay claims
have been lodged at the Employment Tribunal. These claims come not only from
former Manual Workers but also from former APT&C employees.
7.
After successful negotiations with solicitors acting for some of the Claimants, a number
of settlements were made between 2007 and 2012. More recently, further settlement
negotiations have been concluded providing a framework for other settlements to take
place. Paragraphs 13 - 15 below set out the progress made in relation to this further
settlement exercise.
CURRENT POSITION
8.
There has been a total of 803 equal pay claims from employees of the Council in
respect of first wave claims (which covers the period prior to the implementation of
Single Status – up to 31 March 2007) and 929 equal pay claims from employees of the
Council in respect of second wave claims (which covers the period after
implementation of Single Status – after 1 April 2007).
9.
Within each wave there are two sub categories: Work Rated as Equivalent (WRE)
claims (where the comparator’s job has been attributed the same grade under a job
evaluation scheme) and Equal Value (EV) claims (where although the comparator’s
job may be different, the work is held to be of equal worth in terms of its demands).
10.
Within the 803 first wave claims referred to in paragraph 8 above, there are 657 claims
of work rated as equivalent claims known as residual claims where there is an
outstanding claim during the period between 1 April 2006 to 31 March 2007, the earlier
period having been settled by the Council.
11.
First wave claims have been lodged by three different firms of solicitors: Fox &
Partners, Thompsons and Digby Brown and second wave claims have been lodged by
Thompsons and Digby Brown.
12.
The Council initially sought to defend these first wave claims. However, following case
law a number of settlements were made. Following the judgment of the Supreme
Court in the case of North and Others v. Dumfries and Galloway Council [2013] UKSC
45, the Council took the decision that in relevant cases, equal value claims should be
settled. The current position alongside the position reported to Cabinet in September
2014in relation to the first wave claims is as follows:
FIRST WAVE CLAIMS
Digby Brown Claims
13.
270 claims have been settled and employees concerned have received their
compensation payment; 97 claims are currently with Digby Brown, for a decision to be
taken by them on whether the proposed settlement is acceptable; 9 claims are time
barred and will receive no offer of compensation; 1 claim has been withdrawn; and in 7
cases, Digby Brown are not instructed; in 20 cases no offer is being made. In 37
cases there are queries under reconsideration, 8 cases are with Human Resources for
further assessment.
Thompsons Claims
14.
Following settlement of a number of first wave work related as equivalent claims
between 2009 and 2012, 59 equal value claims have been settled and employees
concerned have received their compensation payments, 1 claim is currently with
Thompsons, Solicitors for a decision to taken on whether or not a final settlement is
achievable. The remaining 275 claims, which were lodged as second wave claims
and were subsequently amended to include a first wave element will be assessed to
enable settlement claims to be established for forwarding to the Solicitors in due
course.
Fox and Partners Claims
15.
Following settlement of a number of first wave work rated as equivalent claims
between 2009 and 2012, 19 equal value claims have been settled and employees
concerned have received their compensation payment.
claims from Fox and Partners.
There are no outstanding
SUMMARY OF PROGRESS OF FIRST WAVE CLAIMS
Settled
Offers with claimants’ Agents
Agreed Offers subject to a
Settlement Agreement
Time Bar Claims
Withdrawn Claims
Digby Brown not instructed
No offer being made
Queries under reconsideration
With HR
Outstanding
Total
April 2015
348
97
September 2014
186
65
nil
9
1
7
20
37
8
276
87
9
1
3
nil
nil
nil
452
803
803
SECOND WAVE CLAIMS
16.
There are 929 second wave claims before the Employment Tribunal and the Council is
maintaining its defence to these second wave claims which relate to the preservation
arrangements which were put in place by the Council when implementing its revised
pay and grading scheme on 1 April 2007. It is not anticipated that these cases will
proceed to a hearing soon. Details of these claims are as follows:
Digby Brown Claims
Thompsons Claims
Voice the Union
-
639
286
4
Total
-
929
PROCESSING THE CLAIMS
17.
It should be noted that settling each claim requires detailed calculations to be made
regarding the proposed settlement. Once that calculation has been made detailed
checks are undertaken by Legal Services which look for details of previous
settlements, time bar and other legal issues before the proposed settlement is then
passed for consideration to the Solicitor acting for the employee. However, it is only
once the offer is accepted that a binding legal agreement is issued to the Solicitor
acting on behalf of the employee for signature. Once the legal agreement is signed, a
settlement cheque is issued to the employee’s solicitor.
18.
Additional resources have been made available within Legal Services to assist
processing the first wave claim offers. These additional resources have allowed
progress to be made and are being kept under review.
FINANCIAL IMPLICATIONS
19.
The Council has made provision to meet the cost of settling equal pay claims and
based on current final settlements, it is anticipated that this budgeted sum will meet
the current claims. This provision is reviewed monthly by officers from Finance,
Human Resources and Legal Services; is reflected in the annual Year End
Declarations for the Annual Accounts; is recorded in the Return on Contingent Gains
and Liabilities completed by the Monitoring Officer and the Head of Finance on an
annual basis; and thereafter is reviewed by the Council’s External Auditors. Further,
the additional resources made available to process compensation offers within Legal
Services will be met from existing budgets.
POLICY/LEGAL IMPLICATIONS
20.
The action which is being taken to settle equal pay claims will ensure that the Council
meets its legal obligations in respect of equal pay.
RISK MANAGEMENT IMPLICATIONS
21.
The Council has put in place appropriate measures to mitigate the risk in relation to
equalise pay claims.
COMMUNITY PLANNING IMPLICATIONS
22.
There are no Community Planning Implications in relation to the matters set out in this
report.
TRADE UNIONS
23.
The Trade Unions have appointed legal agents to take forward matters relating to
equal pay.
RECOMMENDATIONS
24.
Cabinet is asked to:
i)
note the position in relation to the equal pay claims which have been lodged by
the Trade Unions against the Council, and
ii)
note that this report will be considered at a future meeting of the Governance
and Scrutiny Committee.
Chris McAleavey
Acting Depute Chief Executive (Safer Communities)
15 April 2015
LIST OF BACKGROUND PAPERS
Nil
Any person wishing further information should contact Martin Rose, Head of Human
Resources (Telephone 01563 576092).
Implementation Officer – Martin Rose, Head of Human Resources