Hello and welcome back to your weekly case law update. Last week we looked at director liability for whistleblowing claims and how this can pose a serious risk to directors if the employer becomes insolvent. This week we are looking at part-time workers and less-favourable treatment.
Regulation 5 of the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 states that part-time workers have the right not to be treated less-favourably than full-time comparators, this includes parity of contractual terms. As such, it is common for employers to pro-rata terms such as salary and holiday entitlement so that terms are comparatively equal.
However, an employer might be able to justify some less-favourable treatment if it is due to legitimate business reasons.
The question this week:
Is it less-favourable treatment to pay a part-time employee a salary of 50% when she has to work more than 50% of a full-time equivalent employee’s contracted days?
Ms Pinaud, the Claimant, was a cabin crew member for British Airways, the Respondent. The Respondent’s full-time cabin crew contract required staff to work/be available for work 243 days a year.
The Claimant was a long-serving employee who went part-time following her maternity leave, on a 14 on, 14 off shift pattern. This pattern required the Claimant to work/be available to work 130 days a year. The Claimant was paid 50% of a full-time equivalent employee.
The Claimant calculated that she was being paid 50% of a full-time salary despite having to work.be available to work 53.5% (130 ÷ 243 x 100) the time of a full-time employee. The Claimant initiated proceedings for less-favourable treatment.
The Respondent tried to argue that despite being available to work for more than 50% of a full-time employee, the Claimant’s hourly rate based on time work (not just available to work) was favourable. The Respondent produced a lot of data to show that the Claimant regularly worked less than 53.5% of a full-time contract.
The ET held that the Claimant’s treatment was both less-favourable and not justifiable, she should have been paid a pro-rated salary of 53.5%. The Respondent appealed and the EAT held that the treatment was less-favourable too (the justification point would be remitted back to a separate ET to be re-decided).
Despite this, the Respondent appealed the less-favourable treatment finding and the Court of Appeal rejected the appeal. The CoA held that whilst there might be a justifiable reason to pay a 50% salary to someone who was contracted to work/be available to work 53.5% of the time. For the treatment to be fair the Claimant would have needed to only work 121.5 days (243 ÷ 2).
The takeaway point:
Yes, it is less-favourable to pay a part-time employee 50% full-time salary when they work 53.5% of a full-time contract. Whilst the hourly rate might be the same due to actual time worked, the employee is still expected to be available to work more than the amount of time they are paid for.
However, the point on whether this treatment is justifiable has yet to be determined. It may be that BA has wasted a lot of time and cost on conduct that whilst being prima facie less-favourable, is nonetheless justified. This case might be teaching grannies to suck eggs for some but does highlight the importance of accurate pro-rata contractual terms.