Thousands of current and former Tesco employees have won a fight in their equal pay dispute with the supermarket.
On Thursday, the European Court of Justice ruled that EU law can be relied upon to make equal pay claims against an employer in the UK.
The supermarket’s shop floor employees, who are mostly women, accused Britain’s biggest grocer of underpaying them by up to £3 per hour, compared with employees in distribution centres who are mostly men, despite their work being of equal value.
They argue that this breaches both UK and EU laws.
The employees, represented by law firm Leigh Day, took their complaints to a tribunal in Watford. They said that the supermarket should be seen as a single entity in terms of employment conditions – as it would be under EU law – and should therefore compensate employees equally for work of equal value.
Tesco argued that the EU “single source” law – which allows workers to be compared with workers in different establishments as long as a “single source” has the ability to correct the difference in pay – did not apply directly in this case.
The UK tribunal sought clarification from Europe’s highest court, the Luxembourg-based European Court of Justice, which rejected Tesco’s claims and ruled in favour of the employees.
The judges said: “The principle, laid down by EU law, of equal pay for male and female workers can be relied upon directly, in respect both of ‘equal work’ and of ‘work of equal value’, in proceedings between individuals.”
This decision binds the UK government, despite the country’s exit from the EU, and cannot be appealed. It will now apply to future equal pay disputes within private businesses in the UK.
In response to the ruling, a Tesco spokesperson said: “The jobs in our stores and distribution centres are different. These roles require different skills and demands which lead to variations in – but this has absolutely nothing to do with gender.
“We reward our colleagues fairly for the jobs they do and work hard to ensure that the pay and benefits we offer are fair, competitive and sustainable. These claims are extremely complex and will take many years to reach a conclusion. We continue to strongly defend these claims”
Kiran Dauka, a partner at Leigh Day, said: “For a long time, employers have argued that UK law in this area is unclear, but this judgment is simple: if there is a single body responsible for ensuring equality, the roles are comparable.”
The law firm has previously said that workers affected by the pay dispute could be entitled to up to six years of back pay compensation, of at least £10,000 each.
Next steps in the equal pay dispute include comparing the roles at UK Employment Tribunals, and investigations into whether the roles are of “equal value” and reasons for differences in pay.