Effective-Cause Principle in Part-Time Workers’ Rights: Broader Interpretation of Regulation 5

Introduction

Augustine v Data Cars Ltd ([2025] EWCA Civ 658) is a Court of Appeal decision concerning the construction of regulation 5 of the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (“the 2000 Regulations”). Mr Augustine, a part-time driver, challenged a “circuit fee” that Data Cars Ltd imposed equally on all drivers. The Employment Tribunal (“ET”) and Employment Appeal Tribunal (“EAT”) disagreed on whether his part-time status was the “sole” or merely an “effective” cause of less favourable treatment. The Court of Appeal was asked to decide two main issues:

Whether McMenemy v Capita Business Services Ltd [2007] IRLR 400 (Inner House) was wrongly decided in holding that a part-timer must prove that less favourable treatment was caused solely by their status; and
Whether, even if McMenemy was wrong, it should nevertheless be followed by this court in deference to the rules of precedent.

Summary of the Judgment

The Court of Appeal (Edis, Laing and Bean LJJ) unanimously held:

Edis LJ: McMenemy was wrongly decided. The 2000 Regulations do not incorporate the word “solely” from the Framework Agreement. Regulation 5(2)(a) is satisfied if part-time status is an “effective cause” of less favourable treatment, even if other factors also contribute. However, under Abbott v Philbin and Jwanczuk v SSWP, the Court of Appeal should follow McMenemy pending Supreme Court guidance. Permission to appeal to the Supreme Court was granted.
Laing LJ (dissenting on correctness): McMenemy correctly reflected the “solely” test in clause 4.1 of the Part-time Work Directive’s Framework Agreement. The domestic draftsman’s omission of “solely” was not intended to broaden the causation test. No clear indication exists in Regulation 5(2)(a) that the UK regulator meant to relax the Directive’s narrow “solely” threshold.
Bean LJ (concurring in result): Agreed with Edis LJ that McMenemy was wrong, supported the broader “effective cause” test as consistent with established UK discrimination law (O’Neill v St Thomas More School) and with the language chosen by Parliament. Nevertheless, on Abbott v Philbin grounds, McMenemy must be followed until Supreme Court resolution.

Analysis

1. Precedents Cited

McMenemy v Capita Business Services Ltd [2007] IRLR 400 (Inner House)
Held that clause 4.1 of the Framework Agreement (which uses “solely because”) required that less favourable treatment be caused solely by part-time status. The court assumed the 2000 Regulations did no more than implement the Directive’s minimum standards and imported the narrow test.
Gibson v Scottish Ambulance Service (EAT 2004)
Adopted and approved in McMenemy. Required an employer’s intention to treat less favourably on the sole ground of part-time status—later disapproved as conflating motive with causation.
Sharma v Manchester City Council [2008] ICR 623
EAT (Elias P) rejected the “solely” test, held that if part-time status is one effective cause of the adverse treatment, Regulation 5(2)(a) is satisfied. Introduced a conventional UK “effective and predominant cause” approach to causation.
Carl v University of Sheffield [2009] 3 CMLR 21
EAT (Judge Clark) agreed with Sharma, applied the “but-for”/effective-cause test, relied on O’Neill v Governors of St Thomas More Roman Catholic School for the meaning of “on the ground of”.
Wippel v Peek & Cloppenburg GmbH & Co KG (ECJ, C-313/02)
Interpreted clause 4 of the Framework Agreement: part-timers must not be treated less favourably “on the sole ground” that they work part time.
O’Neill v Governors of St Thomas More Roman Catholic Voluntary Aided Upper School [1997] ICR 33
Mummery P: “on the ground of” in discrimination law means the “effective and predominant cause”; no requirement that it be the only cause.
Jwanczuk v SSWP [2023] EWCA Civ 1156; [2024] KB 275
Court of Appeal affirmed Abbott v Philbin principle: this court should follow Scottish Inner House decisions on UK-wide legislation unless there are compelling reasons.

2. Legal Reasoning

Edis LJ’s Approach:

Statutory Context: Section 19(1) Employment Relations Act 1999 conferred broad powers to secure that part-timers are not treated less favourably than full-timers “for such purposes and to such extent as the regulations may specify.” The UK regulator omitted “solely” deliberately, choosing a broader standard.
Plain Meaning & Purposive Construction: The words “on the ground that” in Regulation 5(2)(a) should be interpreted according to their ordinary UK meaning—i.e. one effective cause suffices—unless there is a clear intention to mirror the Directive’s narrow “solely” threshold. None appears.
Directive vs. Regulation: If domestic law gives greater protection than the Directive’s minimum standards, it is not ultra vires. A purposive construction favors the broader protection Parliament empowered the Secretary of State to provide.
Concessions in McMenemy: The Inner House’s own concessions that the 2000 Regulations were intended only to mimic the Directive weakens its authority; those concessions were wrongly made and distorted the reasoning.
Precedence Rules: Despite concluding McMenemy is wrong, the Court of Appeal must follow it under Abbott v Philbin and Jwanczuk to avoid jurisdictional inconsistency. Permission to appeal to the Supreme Court was granted for a definitive resolution.

Laing LJ’s Contrasting View:

Directive Framework: The Framework Agreement annexed to Directive 97/81/EC was the result of intensive social-partner negotiations. Clause 4.1’s “solely” reflects a carefully balanced compromise.
Regulatory Silence: The omission of “solely” in the 2000 Regulations does not alone imply an intention to broaden protection—it may simply reflect drafting preferences. No clear textual indicator shows the UK regulator meant to relax the Directive’s narrow lacuna.
Domestic Implementation: UK courts interpret regulations in light of the Directive but should not rewrite express words. Regulation 5(2)(a) deliberately uses “on the ground that” without adding “solely,” but in context the “only if” structure and the broader regulatory scheme point to the Directive’s test.

Bean LJ’s Observations:

Comparison to Established Discrimination Law: The phrases “on the ground that” and “on the ground of” in UK discrimination statutes have long carried the effective-cause meaning (O’Neill). It would have been trivial to insert “solely” if that was intended.
Sharma’s Persuasiveness: The EAT in Sharma, and later in Carl and in this case, applied a coherent UK causation test. Gibson’s reliance on McMenemy was never cited to Sharma; had it been, the result would likely have been the same broader approach.
Doctrine of Precedent: Although convinced McMenemy is wrong, Bean LJ concurs in following it until the Supreme Court decides otherwise or regulations are amended.

3. Impact and Significance

For Part-Time Workers:

If upheld, the “effective cause” standard will allow more claims where part-time status is one of several contributing factors to less favourable treatment.
Employers must assess policies for disparate impact on part-timers—fine distinctions about sole causation will no longer be a safe harbor.

For Employment Tribunals and Courts:

Pending Supreme Court resolution, tribunals in England & Wales must follow McMenemy, applying the “solely” test, even though this court doubts its correctness.
A Supreme Court ruling or amending regulations may decisively adopt the broader “effective cause” approach across all UK jurisdictions.

For UK-EU Directives Implementation:

Underscores that domestic law may extend beyond minimum Directive standards so long as within the enabling statute’s broad grant of powers.
Demonstrates the tension between textual fidelity to EU instruments and UK legislative autonomy when implementing social-partner agreements.

Complex Concepts Simplified

“On the ground that” vs. “solely because”:
- “On the ground that” in UK statutes generally means the factor must be an effective or predominant cause—but need not be the only cause.
- “Solely because” is stricter: the adverse treatment must be caused only by that single factor, excluding any other reason.
Effective-Cause Test: If part-time status makes a material contribution to less favourable treatment—even alongside other factors—that satisfies the causation requirement.
Pro Rata Principle: Regulation 5(3) ensures benefits and pay are apportioned in proportion to hours worked, unless inappropriate.
Directive vs. Domestic Regulation: A Directive sets minimum EU standards. When implementing it, a Member State may adopt broader protections if empowered, but cannot go below those minima.
Doctrine of Precedent (Abbott v Philbin): This court normally follows earlier decisions of equivalent UK courts (including Scottish Inner House) to maintain consistency, unless there are compelling reasons to depart.

Conclusion

Augustine v Data Cars Ltd clarifies that, under English law, regulation 5 of the Part-time Workers Regulations can be construed more broadly than the EU Framework Agreement’s “solely” threshold—so long as part-time status is an effective cause of less favourable treatment. While the Court of Appeal concluded McMenemy was wrongly decided, it remained bound by that precedent pending Supreme Court intervention. The case highlights the interplay between domestic legislative drafting and EU-derived social rights, reinforcing that UK law may extend beyond minimum Directive standards under its enabling statute. Employers and tribunals should watch for the Supreme Court’s forthcoming decision, which will likely settle the proper causation test for part-time discrimination claims across the UK.