Equality Bill

My Lords, I shall speak to government Amendments 72, 75, 78, 79, 93, 94, 95 and 96 as well, alongside Amendments 71, 73, 74, 76 and 77 in the name of the noble Lord, Lord Lester. These amendments are to do with the way in which comparisons are made in equal pay cases and with the material factor defence to equal pay claims. I shall turn first to Amendments 70, 72, 93, 94, 95 and 96 to Clauses 64 and 79, which concern equal pay claims, and then say a few words on Amendments 71, 73 and 74. These amendments are all about how comparison is to be carried out in equality clause claims under the Bill. Clauses 64 and 79 are intended to maintain the effect of current law, so that a person seeking to make an equal pay claim must use a comparator of the opposite sex, whose pay is the responsibility of the same person. The comparator must be a real person doing the same or similar work, or work that has been found to be of equal value. Amendments 70, 72, 93, 94, 95 and 96 are intended to ensure that doubt is not cast on relevant case law, particularly the case of McCarthy v Smith, which established that a comparison can be made with the predecessor in post. It was not our intention to rule out such comparisons. We agree an amendment should be made, and have brought one before the House with the intention of making clear that these kinds of comparison will still be permitted. There are, inevitably, differences of approach between our drafting and that of the noble Lord. We consider that it is important that the link between the wording in Clause 64 and the definition of comparator in Clause 79 is maintained to ensure that it is clear how comparisons can be made under this part of the Bill. We believe the concept of comparator is well understood and more appropriate in the equal pay context. The noble Lord has also included in Amendment 74 a direct reference to the effect of the case McCarthy v Smith, while we have not done so. Amendment 74 states specifically that comparisons are "not restricted to work" that is done "contemporaneously". While I fully understand his wish to make this clear on the face of the Bill, I hope that the noble Lord will understand why we are reluctant to attempt it. That case was brought under Article 141 of the Treaty of Rome, with which our own legislation must be interpreted compatibly. This means that whatever wording we use here, that effect will in any case be maintained. The danger of attempting to make that effect clear on the face of the Bill is that we do not know its boundaries. There is a risk, therefore, that providing new words in domestic legislation—even words as apparently straightforward as those used by the noble Lord—could lead to further complexity as that case law develops. We think it is better not to attempt to codify the point in the way the noble Lord has done, although we hope that the changes we have made, and what I have said, will satisfy him that the effect of the McCarthy case will be maintained. We will also make the point clearer in the Explanatory Notes. I hope that that is also reassuring, and I look forward to hearing the views of the noble Lord and of the Committee. I now turn to government Amendments 75, 78 and 79 and to Amendments 76 and 77 in the name of the noble Lord, Lord Lester. These follow helpful debates in the other place about amendments laid to what is now Clause 69, which my right honourable friend the Solicitor-General indicated on Report that we would consider. Doubt was expressed as to whether our wording required an employer to be able to justify a material factor, which is an indirectly discriminatory effect. I believe that there is broad agreement about what is needed. The material factor defence to an equal pay claim should be able to succeed where the employer shows that the factor on which he relies to explain the difference in pay is real and not a sham; that it is not directly discriminatory; and that if the complainant brings forward evidence that is indirectly discriminatory, the employer can show that reliance on the factor is nevertheless justified and proportionate. That is the position now and that has always been our intention for this clause. We have, as promised, considered the clause again, and have laid Amendments 75, 78 and 79 so that it clearly achieves this result. For example, if an industrial chemist is paid more than a biologist by an employer, although the work is found to be work of equal value, a difference in pay would have to be justified where it had a disproportionate gender impact—perhaps because chemists were mainly men and biologists were mainly women. The employer would need to provide evidence to show why there were pay differences, such as a skills shortage requiring recruitment at a higher rate of pay and his defence would succeed only if he could show that the pay differential was a proportionate means of recruiting people with the requisite skills. The wording of our amendment and that of the noble Lord, Lord Lester, is different but we believe the effect to be substantially the same. I hope the noble Lord agrees that our amendment will achieve the desired results. On that basis, I would be grateful if, in due course, he would consider withdrawing his amendment and supporting the Government’s amendment. I beg to move.