international employment law firm alliance L&E Global
United Kingdom

UK: Equal Pay Audits

Authors: Robert Hill, Corinna Harris and Sophie Jackson

Ms Macken brought claims for equal pay, direct sex discrimination, victimisation, protected disclosure detriment and harassment, and the tribunal found that BNPP had:

  • paid her less than her male comparator on the grounds of sex;
  • directly discriminated against her on the grounds of sex; and
  • victimised her after she raised concerns about unequal pay and sex discrimination.

In a recent remedy judgment, the tribunal awarded Ms Macken over £2m in compensation.

BNPP was also ordered to complete an equal pay audit, and to:

  • identify any differences in pay between men and women;
  • explain the reasons for any identified differences;
  • state the reasons for any potential breach of equal pay; and
  • set out its plans to avoid further breaches.

Key Action Points for Human Resources and In-house Counsel

This case is believed to be one of the first in which a tribunal has ordered an equal pay audit. Although BNPP sought to change their pay practices and corporate culture by instituting a remediation programme, given that the tribunal had found that issues suffered by Ms Macken were partly a result of BNPP’s opaque pay system, and the logical conclusion was that other women may have been affected, BNPP was ordered to complete an equal pay audit.

To reduce the risk of equal pay claims, in addition to carrying out equal pay audits on a regular basis, employers should ensure their pay practices are transparent, clearly setting out the criteria against which pay is assessed, and how pay progression takes place.

The Tribunal considered the discrimination to be of a sufficiently serious nature to make an award for injury to feelings at the middle of the upper Vento band. Vento bands for injury to feelings awards will increase for claims presented on or after 6 April 2022 – the new rates are:

  • lower band: £990 to £9,900 for less serious cases;
  • middle band: £9,900 to £29,600 for cases that do not merit an award in the upper band;
  • upper band: £29,600 to £49,300 for the most serious cases – with the most exceptional cases capable of exceeding £49,300.