Equal pay means that men and women performing equal work must receive equal pay and benefits. This right is protected under the Equality Act 2010 (which replaced the Equal Pay Act 1970) and applies to all contractual terms, not just basic salary.
What Counts as "Equal Work"?
An employee can claim equal pay when compared to a person of the opposite sex doing:
- Like work — the same or broadly similar work
- Work rated as equivalent — work given the same rating under a job evaluation scheme
- Work of equal value — work that is of equal value in terms of demands such as effort, skill, and decision-making
The Sex Equality Clause
Every employment contract has an implied sex equality clause. If a term in a woman's contract is less favourable than the corresponding term in a comparable man's contract (or vice versa), the less favourable term is automatically modified to be no less favourable.
Material Factor Defence
An employer can justify a pay difference if they can show there is a material factor that is not directly or indirectly discriminatory. Examples include:
- Length of service or experience
- Geographical location (e.g., London weighting)
- Market forces requiring higher pay to recruit into a specific role
- Performance-related pay differences
Enforcement
Employees can bring equal pay claims to an employment tribunal within six months of leaving the employment. If successful, back pay can be awarded for up to six years. Employers should conduct regular pay audits to identify and address any gaps.
Need help reviewing your pay structures? Contact our employment law team.