Supreme Court Rules In Favour Of Retail Employees In Equal Pay Claim Against Asda

In a landmark judgment, the Supreme Court has ruled that Asda’s retail employees are entitled to use employees at its distribution depots as comparators for the purposes of equal pay claims. This ruling could have a major impact for other equal pay cases in the retail sector.

Asda Stores Ltd v Brierley and others

Case summary

Thousands of Asda’s retail employees (who are predominantly female) brought an Employment Tribunal claim, arguing that they should receive the same pay as employees at its distribution depots (who are predominantly male). When the claim was made, the discrepancy in pay between the two groups of Asda employees ranged from 80p to £3 an hour.

A person may bring a claim for equal pay if they can show that they are being paid less than another person being employed by the same or associated employer who is doing equal work. Asda argued that the retail employees were not entitled to use distribution employees as comparators for the purposes of an equal pay claim on the basis that they worked at different locations and had different terms and conditions in their contracts.

Additionally, Asda asserted that it had always paid the correct salary for the job, regardless of the sex of the employee, and that both male and female employees worked in both their supermarkets and distribution depots.

The Employment Tribunal, and then the Employment Appeal Tribunal and Court of Appeal, ruled in favour of the retail employees.

In the Court of Appeal judgment, Lord Justice Underhill held that for both the retail and distribution depot employees “Asda applied common terms and conditions wherever they work”. The Supreme Court agreed.

Delivering the Supreme Court’s ruling, Lady Arden once more sided with the retail employees, ruling that the roles of both groups of employees were comparable with one another, even if the employees were not located at the same premises as each other.

Whilst this decision is positive for the many thousands of retail employees who brought the equal pay claim against Asda, it is only a preliminary step. The retail employees must now show that the work they carry out is of ‘equal value’ – in terms of skills and training – to that carried out by the distribution employees. Additionally, Asda could attempt to justify the difference in pay by arguing that it is ‘due to a non-discriminatory material factor’.

Consequently, this case could rumble on for several years to come!

How could the Supreme Court’s judgment impact other retail sector businesses and equal pay cases?

As stated in the Supreme Court’s judgment, this case is:

“important because otherwise an employer could avoid equal pay claims by allocating certain groups of employees to separate sites so that they can have different terms even where this is discriminatory”.

Where an employee is successful in a claim for equal pay they will be entitled to compensation which will usually be arrears of what they should have earned, had they been paid equally. For the purposes of calculating these arrears, an Employment Tribunal can look back for up to six years.

As we have previously reported, other major UK retailers, including Sainsbury’s, Tesco, Morrisons and Next, have also been involved in the long-standing equal pay disputes with shop floor employees, who have put forward arguments similar to that of the Asda retail employees in this case.

Should the Courts and Tribunals rule in favour of the employees in all of these cases, it is estimated that pay outs from retailers could amount to roughly £8 billion.

Equal Pay Claim AsdaHow Nelsons can help

Peter Nicholson is a Senior Associate in our specialist Employment Law team.

For further information in relation to the subjects discussed in this article, please contact Peter or another member of the team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online enquiry form.