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Equal pay claims – key strategic messages for NHS Boards 

 
This is to remind NHS Boards of the current strategy
relating to the management of equal pay claims lodged against NHS organisations that has been agreed by the NHS Management Board.

Background

Equal pay has been a statutory entitlement since the 1970 Equal Pay Act came into force. Successive Secretaries of State have endorsed the principle of equal pay in the NHS which is Government policy.

The Agenda for Change pay system introduced in October 2004 was designed to ensure that pay in the NHS was consistent with the requirements of equal pay law.

The majority of claims have been lodged because claimants believe that either prior to the introduction of Agenda for Change and/or as a result of assimilation onto Agenda for Change pay bands, they have previously been or are being paid less than male colleagues undertaking similar or comparable jobs. 

There are currently nearly 14,000 equal pay claims in the NHS in England as well as numerous grievances (which could become claims in due course) suggesting the potential for significant numbers of further claims.  Of the nearly 14,000 equal pay claims, the majority have been lodged by a “no win no fee” solicitor and the remainder by unions. Most of the claims are in the North East and North West.

The Strategy

The Department has no wish to delay payment of justified equal pay claims, however, there is a number of legal issues which must be resolved before it is clear which, if any, claims are valid.

The NHS has a duty not to divert funds from patient services to settle claims until any liability is properly established. In addition, evidence from past settlements is that they cause tensions between staff, and encourage more claims to come forward from those who feel they have “missed out”.

The advice of the Department of Health, the NHS Management Board, the NHS Litigation Authority (NHSLA), and NHS Employers is, therefore, not to settle any claims until the legal issues are resolved.

NHSLA is seeking to resolve the outstanding legal issues as quickly as possible, but pressures on the Tribunal Service mean that this will take time.  Some cases may then proceed to the Employment Appeals Tribunal, Court of Appeal and, possibly the House of Lords.

The importance of testing the law before any settlement is illustrated by a recent Employment Appeals Tribunal ruling, which contradicted the misconception that common pay banding under a job evaluation scheme creates a right to back pay.

This is not the only issue that needs to be tested.  There are numerous others – for instance whether an applicant in one trust can cite a comparator employed at another trust, and what effects TUPE transfers have on equal pay actions.

Trusts should sign up for support from the NHSLA.  This has several advantages.  Individual trusts retain responsibility and sovereignty over their own claims, but are able to access free NHSLA advice, expert legal advice at discount rates, and up to the minute intelligence on the progress of other equal pay cases, including test cases.  The NHSLA may also provide financial support for the costs of any cases they support as national test cases.

NHS organisations should also keep in close touch with their SHAs on the financial management of equal pay risks. NHS Foundation Trusts may wish to do similar with Monitor.

Finally, NHS Boards are reminded that any equal pay claim potentially backdates for up to 6 years prior to the date of the claim so it is essential that NHS employers maintain accurate historical employment records of employees.  

 

 

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