Leverton v Clwyd County Council 17 Mar 1988 [1989] AC 706, CA

A female nursery nurse claimed equal pay with male clerks. The House of Lords held she performed 'like work' despite different hours and holidays. However, the employer established that these differences, stemming from separate collective agreements, constituted a valid 'material factor' defence.

Facts

The appellant, Mrs. Leverton, a nursery nurse employed by the respondent local authority, Clwyd County Council, initiated a claim for equal pay under the Equal Pay Act 1970. She claimed she was employed on ‘like work’ with male clerical staff also employed by the council, but was paid less. An industrial tribunal found that her work was of equal value to that of her male comparators and therefore constituted ‘like work’ for the purposes of section 1(2)(a) of the Act. However, there were significant differences in their terms and conditions of employment. Mrs. Leverton worked a 32.5-hour week and was entitled to more generous holidays, whereas her male counterparts worked a 37-hour week with fewer holidays. These differing terms stemmed from two separate nationally negotiated collective agreements applicable to their respective staff groups.

Issues

The House of Lords considered two primary legal issues:

1. Whether the differences in hours of work and holiday entitlements meant that the appellant was not ’employed on like work with a man in the same employment’ within the meaning of section 1(2)(a) and section 1(4) of the Equal Pay Act 1970.
2. If she was employed on like work, whether the employer could rely on the ‘material factor’ defence under section 1(3) of the Act, by showing that the variation in pay was genuinely due to a material factor other than the difference of sex, namely the existence of two separate collective bargaining structures.

Judgment

The House of Lords unanimously dismissed the appeal, upholding the decision of the Court of Appeal. Lord Bridge of Harwich delivered the leading speech.

The ‘Like Work’ Question

Lord Bridge held that the question of ‘like work’ under section 1(4) of the Act focuses on the nature of the work done, not the terms of the contract under which it is performed. He determined that differences in terms such as hours and holidays were not ‘differences of practical importance in relation to terms and conditions of employment’ that would negate a ‘like work’ finding. The comparison must relate to the work itself, not the contractual benefits received for it.

Accordingly I am of the opinion that the phrase ‘the terms and conditions of employment’ in section 1(4) is to be construed as referring to terms and conditions which are of practical importance in relation to the work which the woman is employed to do when compared with the man, not to terms and conditions which are of practical importance in relation to the benefits which she is to receive for that work, which are the very subject matter of the equality clause.

Therefore, the industrial tribunal was correct to find that the appellant was employed on ‘like work’ with her male comparators.

The ‘Material Factor’ Defence

The central point of the judgment rested on the employer’s defence under section 1(3). The House of Lords affirmed that the different histories and negotiating structures that led to the different pay and conditions for nursery nurses and clerical staff constituted a genuine material factor that was not the difference of sex. The council had simply applied the terms of two distinct and genuinely negotiated national collective agreements. There was no evidence that these agreements were themselves tainted by sexual discrimination.

I find it, frankly, impossible to see how the industrial history which led to the employment of nursery nurses and clerical staff on the terms of the two different packages of pay and other conditions embodied in the Purple Book and the Blue Book respectively can be described as a ‘sham’ or ‘a mere pretence for discrimination’. The different terms and conditions were adopted by the employers from those which had been negotiated by different bodies at national level. As the Employment Appeal Tribunal said, the employers ‘had a perfectly good reason for the pay differential’.

The court followed its earlier reasoning in Rainey v. Greater Glasgow Health Board [1987] A.C. 224, confirming that an employer does not need to objectively justify a pay disparity if it stems from a cause, such as separate bargaining structures, which is not itself discriminatory.

Implications

The judgment in Leverton significantly clarified the two-stage process in equal pay claims. It established that the ‘like work’ comparison should be confined to the nature of the jobs performed, excluding consideration of other contractual terms like hours or holidays. However, it also strengthened the ‘material factor’ defence for employers. Where pay differences arise from the application of separate, historically distinct, and non-discriminatory collective bargaining agreements for different groups of employees, the employer can successfully argue that this is a genuine material factor justifying the disparity. The case underscores that the source of the pay variation, rather than just its effect, is crucial for the section 1(3) defence, making it more difficult for claimants to succeed in situations governed by complex collective bargaining structures.

Verdict: Appeal dismissed.

Source: Leverton v Clwyd County Council 17 Mar 1988 [1989] AC 706, CA