MRS N R YOUNG v NATIONAL POWER PLC [1999] UKEAT 843_98_2907

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [1999] UKEAT 843_98_2907Case No Appeal No. EAT/843/98Venue 58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS
Between
MRS N R YOUNGAPPELLANTNATIONAL POWER PLCRESPONDENT
Before
His Honour Judge H J ByrtLord Gladwin of CleeDate 29 July 1999
[1]APPEARANCES For the Appellant MR DIJEN BASU (of Counsel) For the Respondents MS JENNIFER EADY (of Counsel) Instructed by: Mr P Millington Messrs Osborne Clarke Solicitors 50 Queen Charlotte Street Bristol BS1 4HE JUDGE BYRT QC : This is an appeal against a decision promulgated on 8th May 1998 of the Employment Tribunal sitting at Bristol. Mrs Young alleged that her employers, National Power Plc, were in breach of the Equal Pay Act 1970 in that, while in their employment, she had performed work of equal value to that performed by two named comparators who were paid more than she was. She further claimed that her selection for redundancy amounted to victimisation under the Sex Discrimination Act 1975 . The Regional Chairman dismissed the claim of victimisation as it was presented outwith the time limits set out in the Sex Discrimination Act , and he did not deem it just or equitable to permit the claim to proceed. Further, the Chairman directed that the issue whether the claim under the Equal Pay Act was within time should be tried as a preliminary issue. The decision of the Tribunal was that the latter claim was out of time and so failed. Mrs Young now appeals that decision. The relevant facts are as follows: Mrs Young joined the electricity industry in 1969. She was a member of the Chartered Institute of Purchasing and Supply. In 1991, she became employed by the Respondents in the Contracts and Procurement Department. Due to downsizing of the procurement function, she was transferred to the Internal Audit Department, and more specifically to what was known as the Value for Money Group ["VFM"]. Her new role was to be a VFM analyst. The Tribunal made a finding that the role of a VFM analyst was a specific job whose main task was a detailed policy examination of a particular area of the Respondents' activity with a view to determining whether costs could be reduced. Each such examination was known as a VFM study.[2]It was accepted that Mrs Young was involved in a number of such VFM studies up and until November 1994 when she began an extended period of sick leave. Save for three days in January 1995 when she returned to work, she was effectively off work till 30th May 1995.[3]Mrs Young had, in fact, since early 1995 been seeking a secondment to work outside the VFM Group owing to serious professional differences she had with the Head of Internal Audit. She had also perceived that VFM study work was diminishing. When she returned to work at the end of May, she was not assigned to any further VFM studies, and in July she was seconded formally to another group known as Group Technology.[4]She was seconded to that Group because she was known to have procurement skills, and a specific project was available which would make use of them. She was asked to make an evaluation of the Respondents' specification and tendering processes to see whether the information required from potential contractors was necessary or adequate. The Tribunal made a finding that this was not a VFM exercise, and although opportunities for cost savings which emerged would not be ignored, the primary aim was not one of cost cutting.[5]When that project was finished, Mrs Young remained with the Group Technology Department, assisting with the placing of various routine contracts.[6]In January 1996, she transferred to Pembroke Power Station where she assisted the procurement officer with the placing of contracts. In May 1996, she returned to the Internal Audit Office. At about that time, the VFM Group ceased to exist. Before her return to the Audit Office, she had been warned that a restructuring of the audit function was about to be implemented and therefore she was at risk of being declared redundant.[7]On 30th May 1996, Mrs Young formally registered her willingness to leave the Respondents under the terms of its severance scheme.[8]At the Audit Office, she was asked to work with the Senior Auditor on improving audit efficiency. This, as the Tribunal found, involved an analysis of the audit department's quality management system which required revision in view of the restructuring which reduced its size from 35 staff to 14. The last phase of this project came to an end in July. In the following August, Mrs Young was transferred to what the Respondents called the Sigma Building and the redundant members of staff called the Departure Lounge. It comprised accommodation in which those leaving were afforded facilities to enable them to pursue other job opportunities, both inside and outside National Power. Whilst there, as the Tribunal found, there was no evidence she received any specific instruction to carry out any particular task. There was no evidence that any work she undertook in this period was undertaken at the request of any manager; and no reports or formal feedback were supplied by her.[9]On 31st October 1996, Mrs Young left the Respondents' employment; her contract of employment with them came to an end. She lodged her Originating Application on 24th April 1997 claiming the Respondents had breached the obligations imposed on them by the Equal Pay Act 1970 . The fundamental question in this appeal is whether that claim was lodged with the Tribunal in time so as to give them jurisdiction to hear the claim.[10]Bearing in mind the six-month limitation period for bringing a claim as prescribed by Section 2(4) of the Act, the Tribunal correctly focussed on the last six days of Mrs Young's employment with National Power, namely the 25th to the 31st October 1996, which came within that six-month limitation period. They then asked whether during those six days, she was "employed" by National Power in the sense relevant to the provisions of the Act. They concluded the relevant "employment" was that which Mrs Young relied upon as the basis of her claim. This was her job as a VFM analyst. Since this job had effectively come to an end following her return from sick leave in May 1995, the Tribunal held that she was not employed in that employment during the relevant six days and so her claim was out of time. Since the Act gave the Tribunal no discretionary power to extend time, they had no alternative but to dismiss the claim.[11]Mr Basu, representing Mrs Young on this appeal, submitted that, when considering this preliminary issue concerning jurisdiction, the Chairman who framed the question and the Tribunal who attempted to answer it, misdirected themselves as to "the employment" which was relevant under Section 2(4). He submitted that they should have enquired whether Mrs Young was working under a contract of employment with National Power during the material six days. Since it was not disputed that she was, the Tribunal did have jurisdiction.[12]Ms Jennifer Eady, for the Respondents, supported the Tribunal's reasoning and their conclusion that they had no jurisdiction. She submitted that when a woman makes a claim in respect of the operation of an equality clause, that clause has to be read as applicable to the particular job to which the complaint related rather than to the employment relationship which might cover a number of different jobs with the same employer. In so contending, she submitted her reasoning followed the guidance afforded by the case of Preston and others v Wolverhampton Healthcare NHS Trust [1998] ICR 227 HL and that therefore the appeal must fail.[13]The determination of this issue of jurisdiction must depend on a proper construction of Section 2(4) as amended of the Equal Pay Act. This provides that:
"No claim in respect of the operation of an equality clause relating to a woman's employment shall be referred to an industrial tribunal … if she has not been employed in the employment within the six months proceeding the date of the reference."
What construction is to be put upon the words "… if she has not been employed in the employment …"? Does this phrase relate to the claimant's contract of employment under which she is employed or to the specific job within that employment upon which she relies for making her claim? The jurisdiction of the Tribunal in any particular case depends upon the answer.[14]We are of the view that assistance is to be gained by considering the wording of Section 2(4) itself and the context in which its provisions are set in the Act.[15]Section 1(1), as substituted by Section 8(1) of the Sex Discrimination Act 1975 , provides that:
"If the terms of a contract under which a woman is employed … do not include … an equality clause they shall be deemed to include one."
[16]Section 1(6) defined "employed" as meaning "employed under a contract of service", and it goes on to provide that "related expressions shall be construed accordingly". However that subsection states that those definitions are for the purposes of Section 1 only. Of what relevance are they to an understanding of Section 2(4)? In the case of Preston and others ( supra ) , Lord Slynn expressed the opinion that those definitions gave an indication that the structure of the Act is based on the incorporation of the equality clause into a specific contract of employment and not simply into an employment relationship.[17]That case was concerned, inter alia, with the proper interpretations of Section 2(4) and its applicability to women employed as part-time teachers or lecturers who respectively belong to one of three groups:(a) those who were employed at the same school under a succession of contracts for the academic year, the only break being for the period of each long vacation;(b) those employed under a succession of fixed-term contracts with breaks during vacations or courses; and(c) those who work intermittently. The essential issue before their Lordships was whether, if a woman claims in respect of the operation of an equality clause within six months of the end of her employment, the equality clause is to be read as applicable to the particular contract governing that employment or as applying to the employment relationship covering a number of different contract with the same employer whether as in (a) and (b) above (periodic but regular) or as in (c) above (intermittent).[18]When considering the provisions of Section 2(4), Lord Slynn said:
"Section 2(4), as amended, refers to a claim in respect of the operation of "an equality clause relating to a woman's employment"
. That equality clause is a clause in a contract of employment which as I see it can only be a specific contract in respect of which the clause is made and which for the purposes of an Industrial Tribunal's jurisdiction must cover employment which has ended within six months of the claim before the Industrial Tribunal. The "woman's employment" in line 2 is referable to "the employment within [the] six months" period in lines 4-5 of the subsection; the latter refers back to employment under a contract which contained, or which by statute had read into it, an equality clause. Where there are breaks between separate contracts, at any rate where there is no umbrella clause under which periodically and regularly work must be given and accepted, the time to bring a claim expires six months from the end of each contract. That conclusion … does not involve putting a gloss on or reading words into section 2(4). It is the natural meaning of the words in their context."[19]That facts of the above case are of course, not precisely similar to those we are presently considering. However, Ms Eady submits, and we think correctly, that the facts of the present case are analogous but she contends that the reasoning in Preston ( supra ) argues that the appeal should fail. She has to accept that there was only one contract of employment which regulated Mrs Young's employment to National Power till 31st October 1996 but she submits that that contract merely described an employer relationship within which, over the years, Mrs Young performed a number of separate jobs. She submits that jurisdiction is determined by the continuance or otherwise within the six month limitation period of the job to which the complaint relates since it is that job with which the operation of the equality clause is concerned, rather than with the contract of employment as a whole.[20]With respect, that argument is, in our judgment, unsustainable. It proceeds on the basic premise, which we think erroneous, of equating the contract of service under which Mrs Young was employed, with the non-contractual status of the employer relationship to which Lord Slynn was referring in Preston ( supra ). Our understanding of what he said in the above quoted passage is that jurisdiction in a case such as that with which we are presently concerned is determined by a two-fold question:(1) within what contract of service is the job, to which the complaint relates, performed; and(2) was that contract extant during the six month limitation period? If the answer to the latter part of the question is 'yes', then the Tribunal has jurisdiction to determine the next question which arises, namely the applicability of the equality clause to the job relied on. By this stage, the Tribunal will have passed on from the debate whether they have jurisdiction and would be considering the substantive issue in the claim.[21]It follows from the above that, in our view, the question asked in the first of the two preliminary issues was erroneous, and the appeal against the Tribunal's decision answering that question must therefore be allowed. We should point out that, in framing this issue in pursuit of the laudable objective of saving costs, the learned Chairman would not have had the assistance afforded by the judgment in Preston ( supra ) which was not delivered until early in the New Year. At the same time, we would wish to compliment the Tribunal who heard the case for the care and thoroughness with which they sifted the facts in their endeavour to answer the preliminary questions drafted for them.[22]We have considered the consequential directions we should make. It is not disputed that Mrs Young's only contract of employment with National Power continued for the first six days of the six-month limitation period. Since this is the only finding of fact needed to determine jurisdiction, we think it appropriate that we substitute a finding that the Tribunal had jurisdiction, and further to direct that the Tribunal proceed to hear the claim. Such a hearing will entail four stages: first an evaluation of the job Mrs Young relies upon as set out in her Originating Application; second a comparison of that job with that performed by the two comparators; third, a consideration as to whether the employers are in breach of the equality clause, if at all; and four, an assessment of how much of the time between 25th April 1995 and 31st October 1996 the employers were in breach of that clause, if at all. The original Tribunal who heard this case, made findings in relation to the first and fourth of those issues. In our view it would be unsatisfactory at this distance of time to ask that original Tribunal to attempt a recollection of the evidence on those two issues in order to determine the remaining two. Accordingly, we direct that the claim be reheard before a differently constituted Tribunal.[23]The difficulties which now present themselves argues that it might well have been over-ambitious to have attempted to take this last mentioned issue as a preliminary question.