Employment Special Interest Group

Transcription

1 Employment law: the convenient jurisdiction to bring equal pay claims - the High Court or County Court on the one hand or the Employment Tribunal on the other hand? Jonathan Owen

2 Introduction 1. On 24 th of October 2012 the Supreme Court (Lady Hale, Lord Wilson, Lord Sumption, Lord Reed and Lord Carnwath SCJJ) gave judgement in the case of Birmingham City Council (Appellant) v. Abdulla and Others (Respondents) [2012] UKSC 47 (hereafter The Birmingham City Council case ). 2. The case has important ramifications for time limits and the choice of forum in which to bring equal pay claims, and the consequences of choosing which forum in which to bring such claims. The purpose of this article is to summarise the outcome of that case. 3. Section 1 of the Equal Pay Act 1970 (hereafter the 1970 Act ) deemed employment contracts to include an equality clause which had, amongst other effects, the following effects where [a] woman is employed on work rated as equivalent with that of a man in the same employment :- (i) if (apart from the equality clause) any term of the woman s contract determined by the rating of the work is or becomes less favourable to the woman then a term of a similar kind in the contract under which that man is employed, that term of the woman s contract shall be treated as so modified as not to be less favourable, and (ii) if (apart from the equality clause) at any time the woman s contract does not include a term corresponding to a term benefiting that man included in the contract under which he is employed and determined by the rating of the work, the woman s contract shall be treated as including such a term. 4. The 1970 Act has now been replaced by the Equality Act 2010 (hereafter the 2010 Act ), which include similar provisions in Chapter 3 of Part 5. The Birmingham City Council case is equally relevant to claims under the 2010 Act as it is to claims under the 1970 Act. 5. In the Birmingham City Council case former employees sued their employer in the High Court alleging a breach of the equality clause pursuant to the 1970 Act. 2/7

3 6. The case came to the Supreme Court because the employer applied to strike out the claims on the basis that they should have been brought in the Employment Tribunal rather than in the civil courts. 7. Under both the 1970 Act and the 2010 Act the civil courts and the Employment Tribunal each have jurisdiction to try equality clause claims, save that if a claim is brought in a civil court the court may strike out a case which it concludes could more conveniently be determined by an employment tribunal. 8. Importantly, however, there are differences in the time limits for presenting equality clause claims to the civil courts and the Employment Tribunal. In the civil court the time limit is six years, whereas in a standard case the time limit in the Employment Tribunal is six months from the date of the end of the employee s employment. 9. This difference in time limits would have made a real difference in the Birmingham City Council case because the claims would be in time in the civil court but out of time in the Employment Tribunal. 10. The issue in the Birmingham City Council case was accordingly what meaning should be given to the ability to strike out claims in the civil courts which could more conveniently be disposed of by the Employment Tribunal. 11. The employer contended that except where an employee could provide a reasonable explanation for her failure to bring a claim in time in the Employment Tribunal, her claim should be struck out, because otherwise the claim could conveniently have been disposed of by the Employment Tribunal. The contention clearly merited careful consideration because:- a. Employment tribunal s offer to litigants many advantages not on offer in a civil court, including greater expertise in their determination, less cost, and, in principle at least, faster resolution: please see paragraph 6 of the opinion of Lord Wilson (with whom lady Hale and Lord Reed agreed); and b. What was Parliament s purpose in providing a strict time limit for the presentation of claims to the employment tribunal if those who failed to comply with it could have their claims heard 3/7

4 elsewhere: please see paragraph 13 of the opinion of Lord Wilson (with whom lady Hale and Lord Reed agreed)? Conveniently 12. The majority noted that Parliament had legislated on the equal pay issue by inserting into contracts of employment the equality clause. Although it conferred on the Employment Tribunal jurisdiction to determine a claim for breach of contract in that regard, it did not oust the jurisdiction of the civil courts to determine such a claim, and it was plain that there was concurrent jurisdiction between the Employment Tribunal and the civil court. The majority further noted that, strikingly, the Employment Tribunal s limitation period had never been made extendable, and that it was thus strongly arguable that Parliament tolerated an unusually absolute time limit only because it recognised that, were a claimant to fall foul of that time limit, the claimant would nonetheless be able to bring a claim in the civil court. 13. The majority did not consider the famous forum non conveniens jurisdiction case of Spiliada Maritime Corporation v. Cansulex Limited [1987] Ac 460 to be helpful in this different context. That case considered the claim of ship owners suing shippers for breach of contract who sought leave to serve the shippers out of jurisdiction. This was opposed by the shippers on the basis that the ship owners should have sued them if at all, in British Columbia, where any such action would have been statute-barred. Lord Goff, with whose opinion the rest of the Judicial Committee agreed, considered that if a plaintiff acted reasonably in commencing proceedings in England and Wales, and, although (putting to one side the time bar point) the appropriate forum for the trial was elsewhere than England and Wales, the plaintiff did not act unreasonably in failing to commence proceedings in that jurisdiction within the time limit applicable there, that plaintiff would not be deprived of the ability to bring proceedings in England and Wales. This case was not helpful in the Birmingham City Council case, so the majority reasoned, because Lord Goff had there to consider a much broader canvas of which international jurisdiction proceedings should be brought in, rather than simply to apply the words more conveniently to the question of whether an entirely domestic claim which Parliament has specifically allowed a claimant to bring in civil courts could more conveniently be disposed of by an Employment Tribunal. 4/7

5 14. The majority determine that both for the purposes of the 1970 Act and the 2010 Act, a claim in respect of the operation of an equality clause can never be more conveniently disposed of by an Employment Tribunal if it would there be time-barred. 15. The majority noted that nothing can detract from the inherent jurisdiction of the courts to strike out a claim in respect of the operation of an equality clause if it were to represent an abuse of process. Please see paragraph 29 of the judgment, where one example cited was that of a Claimant who had been invited to present a complaint in time to the Employment Tribunal and he had spurned the invitation in order to secure what the court considered to be an illegitimate advantage by bringing the claim before the court. There is accordingly the long-stop control measure of abuse of process in relation to illegitimate forum shopping. 16. Also, the court noted that the court would have a discretion as to any costs order which might be made in court proceedings, a legitimate concern of the employer being that court proceedings would generally result in a costs order, whereas tribunal proceedings generally would not. It was considered that it might well be relevant in deciding what, if any, costs order to make, to consider whether the claimant should, in all the circumstances, reasonably have presented her claim, in time, to the Employment Tribunal. 17. Lord Sumption (with whom Lord Carnwath agreed) dissented. Their Lordships considered that three important features of the statutory landscape were that the equality clause regime:- a. Provided in the public interest as well as in the interests of the parties for particular categories of employment disputes to be referred to a specialised tribunal, applying a procedure particularly adapted to the hearing of such disputes; b. laid down in the interests of employers a highly restrictive regime of limitation for cases brought in the specialist tribunal; c. contained a careful and qualified definition of the circumstances in which older claims can be brought in the specialist tribunal. 5/7

6 18. Lord Sumption considered that Parliament could not rationally be thought to have intended that a far less restrictive regime should apply at the unfettered option of the employee, by the simple device of bringing his claim in a court of general jurisdiction lacking the specialist experience and the specially adapted procedures: please see paragraph 45 of the judgment. 19. The dissenting Lords considered that the appropriate test was whether it was in the interests of justice for a claim which would have been out of time in the Employment Tribunal to proceed in the civil court. The fact that a claim would be time-barred in the employment tribunal is a highly relevant factor to that exercise, according to the dissenting judges, but not a conclusive one, and not even nearly conclusive. Other relevant considerations might be whether the Claimant acted reasonably in failing to bring his claim before the appropriate tribunal in time, whether the passage of time since the expiry of the Employment Tribunal time-bar has made the issues more difficult to determine justly, and whether the employer would be exposed to a substantial liability in costs in court which he would not have faced in the Employment Tribunal. 20. The majority, however, deprecated this multi-factorial inquiry advocated by the dissenting judges, saying that conveniently simply requires a straightforward practical inquiry into the forum more convenient for investigation of the merits. It is analogous to the practical inquiry which attends the permission given to a claimant by rule 7.3 of the CPR to use a single claim form to start all claims which can be conveniently disposed of in the same proceedings. Please see paragraph 27 of the judgement. Conclusions 21. This case will, to a large measure, close down satellite litigation about the jurisdiction in which an equality clause claim can be brought, by making it clear that a claim cannot more conveniently be brought in the Employment Tribunal if it would be out of time there. There are, however, still issues to be explored in cases which should arguably have been brought in an Employment Tribunal, rather than in a civil court, and in particular, whether the civil court claim is an abuse of process and whether the ordinary costs rules in civil claims should be dis-applied. There will therefore still be battles to be fought, on both sides, arising out of a Claimant s choice of jurisdiction in equality clause claims. 6/7

7 Jonathan Owen January 2013 Jonathan Owen Jonathan Owen was called to the Bar in He is a specialist in personal injury, clinical negligence, disease, fraudulent claims, regulatory, costs, business and property, employment, planning and environmental and local government claims and professional discipline and regulation matters. jonathanowen@ropewalk.co.uk Disclaimer: The information and any commentary on the law contained in this presentation is provided free of charge for information purposes only. The opinions expressed are those of the writer and do not necessarily represent the view of Ropewalk Chambers as a whole. Every reasonable effort is made to make the information and commentary accurate and up to date, but no responsibility for its accuracy and correctness, or for any consequences of relying on it, is assumed by the writer nor by Ropewalk Chambers. The information and commentary does not, and is not intended to, amount to legal advice to any person on a specific case or matter. You are advised to obtain specific, personal advice from a lawyer about your case or matter and not to rely on the information or comment contained within this Article. 7/7