Court of Session judgment in Glasgow City Council ALEO equal pay appeal

On 21 March 2014, the Court of Session issued its judgment in Glasgow City Council v Unison and Fox Cross Claimants [2014] CSIH 27.

The Court has upheld the judgment of the Employment Appeal Tribunal that Glasgow City Council are associated employers for the purposes of equal pay law and that the female claimants working for City Parking and Cordia can compare their pay with that of men still working for the Council.

The issue at the heart of this litigation was whether the claimants, who work for City Parking (Glasgow) and Cordia (Services) LLP, should be allowed to compare their pay with male employees working for the Council. The claimants used to work for the Council. However, they were transferred to City Parking and Cordia when these arm’s length external organisations (ALEOs) were established to carry out functions which were formerly carried out by the Council directly.

Under the Equality Act 2010 an employee can claim equal pay with a comparator of the opposite sex who is doing like work, work rated as equivalent or work of equal value. However, the comparator must be employed by the same or an associated employer at the same establishment or workplace or if they are employed at a different establishment or workplace, then there must be common terms and conditions between employees. This is referred to as the ‘same employment’ test.

Under European Union (EU) law differences in pay must be attributable to a single source which is capable of remedying any unlawful discrimination. If this is different from the ‘same employment’ test, EU law may be applied to produce a remedy.

The Court of Session agreed with the EAT that the Council is an associated employer of both City Parking and Cordia and that men employed by the Council are to be treated as in the same employment with women employed by the ALEOs. 

The Court went on to find that the correct approach to the single source question, as explained by Lord Justice Mummery in Department for Environment, Food and Rural Affairs v Robertson [2005] ICR 750, is to determine whether there is a single source setting the relevant terms for the relevant employees and “which is responsible for the inequality and which could restore equal treatment”.

The Council’s appeal was refused and the equal pay claims were remitted back to the tribunal to proceed.

Last updated: 01 Jul 2016