FINANCE £300m deal would avoid legal precedent, says DoH

Published: 24/02/2005, Volume II5, No. 5944 Page 11

The Department of Health was on the brink of agreeing a£300m out-of-court settlement on equal pay to avoid creating a legal precedent which could cost the NHS still more dearly, as HSJ went to press.

Around 1,400 women hospital workers - all employed by North Cumbria Acute Hospitals trust - have been claimants in a massive Unison-led equal value legal challenge that was due to go before a series of employment tribunals starting in Newcastle on Monday morning.

But the tribunal chair agreed to delay proceedings by a further 30 hours after barristers for the trust said there was a prospect of reaching a resolution out of court 'given a little more time'.

The union's lawyers said success was 'by no means guaranteed', but that they were hopeful of resolution.

As HSJ went to press, an agreement had yet to be announced. Unison insiders believe the deal would give some of the women compensation payouts of up to£200,000, likely to be paid over the next three years.

Though costly, the package would mean the DoH averting a potentially devastating tribunal ruling with implications for the rest of the NHS.

The DoH believes that agreeing an out-of-court settlement will avoid setting a legal precedent entitling large numbers of staff across the NHS to compensation and back pay, and putting the pay reforms of Agenda for Change into chaos. If the tribunal had found in favour of the women, they could have seen their pay increased to rates higher than those of more senior colleagues, making a nonsense of the new pay structure.

The challenge was first launched eight years ago by Unison's Carlislebased full-time official Peter Doyle.

Mr Doyle and his legal team have pressed North Cumbria Acute Hospitals to compensate the women, half of them nurses. They argued that the women's work has been of equal worth to that of higher-paid men in comparable roles.

Since launching the challenge in 1997, Mr Doyle's legal team amassed evidence for 14 test cases, each designed to prove that gender was the deciding factor in keeping down pay rates for women health workers. Most claimants are C and D-grade nurses, but the list includes cytoscreeners, domestics, supervisors, lab assistants, telephonists, and cooks.

All have been employed in NHS jobs traditionally dominated by women.

The test cases include a D-grade nurse, paid£18,500, compared to a male estates officer on a salary of£26,900. The jobs are of equal value, according to independent experts.

The challenge - the biggest of its kind in Europe - involves claims backdated by 14 years.

The two sides came to the brink of a deal on the weekend of 10-11 February. But Mr Doyle says that just hours before it was due to be signed off, it transpired that health service lawyers had mistakenly believed it would cost no more than£60m instead of£300m.

'They were in a state of panic, ' said Mr Doyle, who said a stand-off between the two parties followed.

Stefan Cross, a Newcastle lawyer specialising in equal value claims, said a victory at tribunal would have had far-reaching implications for Agenda For Change.

Given that the Cumbrian workers were paid within national pay scales, a tribunal victory for them could be replicated at trusts across the country, he said.

This is because tribunals do not compensate successful equal value claimants, as happens 'out of court.' Instead, they order the employer to grant lost back pay and give immediate pay parity with the higher-paid comparator.

That would give the D-grade nurses higher pay than their higher-graded colleagues.

Almost certainly, there would be counter-claims from the more senior staff on lower salaries - a situation that could then be replicated by health workers for all the job categories involved, said Mr Cross, who represents 80 E and F-grade nurses who are launching their own equal value claims separate from the Unison action.

Carlisle nurse Mandy Larkin summed up the feelings of many of the claimants. She said: 'It is all about getting paid for the responsibility that we have. I got really annoyed when I found out that an electrician who had equal training to me was getting paid far more.

'I know his job is essential, but my job is too.' Trust chief executive Marie Burnham stressed the trust will not suffer financially as a result of a deal.

She said: 'Whatever the outcome of an agreement, the DoH have told me that any settlement will not impact on the funds allocated to local acute services in north Cumbria.'

Facts and figures from the North Cumbria case

Unison says 1,400 women health workers - a third of their trust's workforce - have lodged equal value claims, alleging 'historic' pay discrimination.

Paying unequally for jobs of 'equal value' is prohibited by the Equal Pay Act, article 119 of the Treaty of Rome, and the European equal pay directive.

To date, North Cumbria Acute Hospitals trust, which manages Cumberland Infirmary in Carlisle and West Cumberland Hospital in Whitehaven, has spent£787,570 on legal costs.

Unison has prepared 14 test cases to illustrate that traditionally female jobs are equal to male-dominated jobs that pay more. The claimants include C and D-grade nurses, cooks, catering staff, laboratory assistants, telephonists and cytoscreeners.

The comparisons include an estates officer on£26,900, compared to a D-grade nurse earning£18,500; and a nursing assistant whose£12,000 lags behind the salary of a medical technical officer on£15,800.

If Unison wins its case, the tribunal has powers to award immediate pay parity for any jobs judged equal. Back pay would date back to the time the claim was lodged, and then to a time six years before that.